[N-CSR] Putnam Municipal Opportunities Trust Certified Shareholder Report
Putnam Municipal Opportunities Trust (NYSE: PMO) filed its Form N-CSR for the fiscal year ended 30 April 2025. The closed-end fund pursues federally tax-exempt income by investing primarily in investment-grade and select high-yield municipal bonds while employing leverage via preferred shares. During the 12-month period the fund recorded a +1.43 % total return on net asset value (NAV) and a +6.46 % total return on market price. The Bloomberg Municipal Bond Index returned +1.66 % over the same span. NAV slipped from $11.17 to $10.92, whereas the market price rose from $9.72 to $9.94, modestly narrowing the market-price discount.
Managed distribution plan. Until 30 April 2025 the fund paid a monthly distribution of $0.035 per share. Effective 1 May 2025 the board increased the rate to $0.0393, signalling a roughly 12 % uplift. For the fiscal year the fund distributed $0.42 per share, of which $0.3182 was net investment income and $0.1018 (≈24 %) was return of capital. Management notes that, if income is insufficient, future payments may include long-term capital gains or additional return of capital. The plan is reviewed annually and can be amended or terminated without prior notice.
Portfolio positioning and results. The team maintained overweights in housing, continuing-care retirement communities and higher education sectors, plus a “bulleted” 10- to 20-year duration stance. Spread tightening aided performance, while a modestly long duration posture detracted as Treasury yields fell 52 bp. Sector allocation on 30 April 2025 was led by Health Care (17.85 %), Transportation (15.71 %) and Housing (12.86 %).
Management changes. Effective 30 September 2024, James Conn, Francisco Rivera, Daniel Workman and Benjamin C. Barber joined the portfolio management team. Long-time manager Paul M. Drury intends to retire on 30 May 2025.
Key risks and disclosures. The trust highlights leverage, interest-rate, credit and potential legislative risks, including a proposal to remove municipal bonds’ tax-exempt status. Approximately 24 % of FY-2025 distributions constituted return of capital, which may erode NAV if not offset by gains.
Putnam Municipal Opportunities Trust (NYSE: PMO) ha presentato il suo Modulo N-CSR per l'esercizio fiscale terminato il 30 aprile 2025. Il fondo chiuso mira a generare reddito esente da imposte federali investendo principalmente in obbligazioni municipali di alta qualità e selezionate ad alto rendimento, utilizzando inoltre leva finanziaria tramite azioni privilegiate. Nel periodo di 12 mesi, il fondo ha registrato un rendimento totale del +1,43% sul valore patrimoniale netto (NAV) e un rendimento totale del +6,46% sul prezzo di mercato. L'indice Bloomberg Municipal Bond ha restituito un +1,66% nello stesso intervallo. Il NAV è sceso da 11,17 a 10,92 dollari, mentre il prezzo di mercato è salito da 9,72 a 9,94 dollari, riducendo leggermente lo sconto sul prezzo di mercato.
Piano di distribuzione gestita. Fino al 30 aprile 2025 il fondo ha pagato una distribuzione mensile di 0,035 dollari per azione. A partire dal 1° maggio 2025 il consiglio ha aumentato la quota a 0,0393 dollari, segnando un incremento di circa il 12%. Nell'anno fiscale il fondo ha distribuito 0,42 dollari per azione, di cui 0,3182 dollari derivanti da reddito netto da investimenti e 0,1018 dollari (circa il 24%) come ritorno di capitale. La gestione sottolinea che, in caso di reddito insufficiente, i pagamenti futuri potrebbero includere plusvalenze a lungo termine o ulteriori ritorni di capitale. Il piano è rivisto annualmente e può essere modificato o interrotto senza preavviso.
Posizionamento e risultati del portafoglio. Il team ha mantenuto sovrappesi nei settori abitativo, comunità di assistenza continuativa e istruzione superiore, adottando inoltre una durata “bulleted” tra 10 e 20 anni. Il restringimento degli spread ha favorito la performance, mentre una posizione leggermente lunga in durata ha penalizzato a causa del calo di 52 punti base dei rendimenti dei Treasury. Al 30 aprile 2025, l'allocazione settoriale era guidata da Sanità (17,85%), Trasporti (15,71%) e Abitazioni (12,86%).
Cambiamenti nella gestione. Dal 30 settembre 2024, James Conn, Francisco Rivera, Daniel Workman e Benjamin C. Barber si sono uniti al team di gestione del portafoglio. Il manager di lunga data Paul M. Drury intende andare in pensione il 30 maggio 2025.
Rischi chiave e comunicazioni. Il trust evidenzia rischi legati alla leva finanziaria, ai tassi d'interesse, al credito e a potenziali rischi legislativi, inclusa una proposta di rimozione dello status esentasse per le obbligazioni municipali. Circa il 24% delle distribuzioni del FY-2025 è stato costituito da ritorno di capitale, che potrebbe ridurre il NAV se non compensato da guadagni.
Putnam Municipal Opportunities Trust (NYSE: PMO) presentó su Formulario N-CSR para el año fiscal finalizado el 30 de abril de 2025. El fondo cerrado busca ingresos exentos de impuestos federales invirtiendo principalmente en bonos municipales de grado de inversión y selectos de alto rendimiento, empleando apalancamiento a través de acciones preferentes. Durante el período de 12 meses, el fondo registró un rendimiento total del +1.43 % sobre el valor neto de los activos (NAV) y un rendimiento total del +6.46 % sobre el precio de mercado. El índice Bloomberg Municipal Bond retornó +1.66 % en el mismo período. El NAV bajó de $11.17 a $10.92, mientras que el precio de mercado subió de $9.72 a $9.94, reduciendo modestamente el descuento sobre el precio de mercado.
Plan de distribución gestionado. Hasta el 30 de abril de 2025, el fondo pagó una distribución mensual de $0.035 por acción. A partir del 1 de mayo de 2025, la junta aumentó la tasa a $0.0393, señalando un aumento aproximado del 12 %. Para el año fiscal, el fondo distribuyó $0.42 por acción, de los cuales $0.3182 fueron ingresos netos de inversión y $0.1018 (≈24 %) retorno de capital. La administración señala que, si los ingresos son insuficientes, los pagos futuros podrían incluir ganancias de capital a largo plazo o retornos adicionales de capital. El plan se revisa anualmente y puede ser modificado o terminado sin previo aviso.
Posicionamiento y resultados de la cartera. El equipo mantuvo sobreponderaciones en los sectores de vivienda, comunidades de retiro con cuidados continuos y educación superior, además de una postura de duración “bulleted” de 10 a 20 años. El estrechamiento de los diferenciales ayudó al desempeño, mientras que una postura ligeramente larga en duración afectó negativamente debido a la caída de 52 puntos básicos en los rendimientos del Tesoro. La asignación sectorial al 30 de abril de 2025 estuvo liderada por Salud (17.85 %), Transporte (15.71 %) y Vivienda (12.86 %).
Cambios en la gestión. A partir del 30 de septiembre de 2024, James Conn, Francisco Rivera, Daniel Workman y Benjamin C. Barber se unieron al equipo de gestión de cartera. El gestor de larga data Paul M. Drury planea retirarse el 30 de mayo de 2025.
Riesgos clave y divulgaciones. El fideicomiso destaca riesgos relacionados con apalancamiento, tasas de interés, crédito y posibles riesgos legislativos, incluida una propuesta para eliminar el estatus exento de impuestos de los bonos municipales. Aproximadamente el 24 % de las distribuciones del año fiscal 2025 constituyeron retorno de capital, lo que podría erosionar el NAV si no se compensa con ganancias.
Putnam Municipal Opportunities Trust (NYSE: PMO)는 2025년 4월 30일 종료된 회계연도에 대한 Form N-CSR을 제출했습니다. 이 폐쇄형 펀드는 주로 투자등급 및 일부 고수익 지방채에 투자하며 우선주를 통한 레버리지를 활용하여 연방 세금 면제 소득을 추구합니다. 12개월 동안 펀드는 순자산가치(NAV) 기준 +1.43% 총수익과 시장가격 기준 +6.46% 총수익을 기록했습니다. 같은 기간 블룸버그 지방채 지수는 +1.66%를 기록했습니다. NAV는 11.17달러에서 10.92달러로 하락한 반면, 시장가격은 9.72달러에서 9.94달러로 상승해 시장가격 할인폭이 다소 축소되었습니다.
관리 배당 계획. 2025년 4월 30일까지 펀드는 주당 월 0.035달러의 배당금을 지급했습니다. 2025년 5월 1일부터 이사회는 배당금을 주당 0.0393달러로 인상하여 약 12% 상승을 나타냈습니다. 회계연도 동안 펀드는 주당 0.42달러를 분배했으며, 이 중 0.3182달러는 순투자소득, 0.1018달러(약 24%)는 자본환급이었습니다. 운용팀은 소득이 부족할 경우 향후 지급액에 장기 자본이득 또는 추가 자본환급이 포함될 수 있다고 밝혔습니다. 이 계획은 매년 검토되며 사전 통보 없이 변경되거나 종료될 수 있습니다.
포트폴리오 포지셔닝 및 성과. 팀은 주택, 지속적 돌봄 은퇴 커뮤니티, 고등교육 부문에 대한 비중 확대를 유지했으며, 10~20년 만기의 '불릿'(duration) 전략을 취했습니다. 스프레드 축소가 성과에 도움이 되었으나, 국채 수익률이 52bp 하락하면서 다소 긴(duration) 포지션은 성과에 부정적 영향을 미쳤습니다. 2025년 4월 30일 기준 섹터별 비중은 보건(17.85%), 운송(15.71%), 주택(12.86%)이 주도했습니다.
운용진 변경. 2024년 9월 30일부터 James Conn, Francisco Rivera, Daniel Workman, Benjamin C. Barber가 포트폴리오 운용팀에 합류했습니다. 오랜 기간 운용을 맡아온 Paul M. Drury 매니저는 2025년 5월 30일 은퇴할 예정입니다.
주요 위험 및 공시사항. 신탁은 레버리지, 금리, 신용 및 지방채의 세금 면제 지위 제거 제안 등 잠재적 입법 위험을 강조합니다. 2025 회계연도 분배금의 약 24%가 자본환급으로 구성되어 있으며, 이는 수익으로 상쇄되지 않으면 NAV 감소를 초래할 수 있습니다.
Putnam Municipal Opportunities Trust (NYSE : PMO) a déposé son formulaire N-CSR pour l'exercice fiscal clos le 30 avril 2025. Ce fonds fermé vise à générer des revenus exonérés d'impôt fédéral en investissant principalement dans des obligations municipales de qualité investissement et certains titres à haut rendement, tout en utilisant un effet de levier via des actions privilégiées. Sur la période de 12 mois, le fonds a enregistré un rendement total de +1,43 % sur la valeur liquidative (NAV) et un rendement total de +6,46 % sur le prix de marché. L'indice Bloomberg Municipal Bond a affiché +1,66 % sur la même période. La NAV est passée de 11,17 $ à 10,92 $, tandis que le prix de marché est passé de 9,72 $ à 9,94 $, réduisant modestement l'écart de décote sur le prix de marché.
Plan de distribution géré. Jusqu'au 30 avril 2025, le fonds versait une distribution mensuelle de 0,035 $ par action. À compter du 1er mai 2025, le conseil d'administration a augmenté ce montant à 0,0393 $, soit une hausse d'environ 12 %. Sur l'exercice, le fonds a distribué 0,42 $ par action, dont 0,3182 $ de revenu net d'investissement et 0,1018 $ (≈24 %) de retour de capital. La direction indique que si les revenus sont insuffisants, les paiements futurs pourraient inclure des plus-values à long terme ou des retours de capital supplémentaires. Le plan est révisé annuellement et peut être modifié ou interrompu sans préavis.
Positionnement et résultats du portefeuille. L'équipe a maintenu des surpondérations dans les secteurs du logement, des communautés de retraite avec soins continus et de l'enseignement supérieur, ainsi qu'une position de duration « bulleted » de 10 à 20 ans. Le resserrement des écarts de crédit a soutenu la performance, tandis qu'une position légèrement longue en duration a pénalisé les résultats en raison de la baisse de 52 points de base des rendements du Trésor. L'allocation sectorielle au 30 avril 2025 était dominée par la santé (17,85 %), les transports (15,71 %) et le logement (12,86 %).
Changements dans la gestion. À compter du 30 septembre 2024, James Conn, Francisco Rivera, Daniel Workman et Benjamin C. Barber ont rejoint l'équipe de gestion de portefeuille. Le gestionnaire de longue date Paul M. Drury prévoit de prendre sa retraite le 30 mai 2025.
Principaux risques et divulgations. Le trust souligne les risques liés à l'effet de levier, aux taux d'intérêt, au crédit et aux risques législatifs potentiels, y compris une proposition visant à supprimer le statut d'exonération fiscale des obligations municipales. Environ 24 % des distributions de l'exercice 2025 étaient constituées de retour de capital, ce qui pourrait réduire la NAV si cela n'est pas compensé par des gains.
Putnam Municipal Opportunities Trust (NYSE: PMO) hat seinen Form N-CSR für das am 30. April 2025 endende Geschäftsjahr eingereicht. Der geschlossene Fonds verfolgt steuerlich freigestellte Bundeserträge, indem er hauptsächlich in Investment-Grade- und ausgewählte Hochzinskommunalanleihen investiert und dabei Hebelwirkung über Vorzugsaktien einsetzt. Im 12-Monats-Zeitraum erzielte der Fonds eine Gesamtrendite von +1,43 % auf den Nettoinventarwert (NAV) und eine Gesamtrendite von +6,46 % auf den Marktpreis. Der Bloomberg Municipal Bond Index erzielte im gleichen Zeitraum +1,66 %. Der NAV sank von 11,17 auf 10,92 US-Dollar, während der Marktpreis von 9,72 auf 9,94 US-Dollar stieg, wodurch der Abschlag auf den Marktpreis leicht verringert wurde.
Geleiteter Ausschüttungsplan. Bis zum 30. April 2025 zahlte der Fonds eine monatliche Ausschüttung von 0,035 US-Dollar je Aktie. Ab dem 1. Mai 2025 erhöhte der Vorstand die Ausschüttung auf 0,0393 US-Dollar, was einer Steigerung von etwa 12 % entspricht. Im Geschäftsjahr verteilte der Fonds 0,42 US-Dollar je Aktie, davon entfielen 0,3182 US-Dollar auf Nettoanlageerträge und 0,1018 US-Dollar (≈24 %) auf Kapitalrückzahlungen. Das Management weist darauf hin, dass bei unzureichenden Einnahmen zukünftige Zahlungen langfristige Kapitalgewinne oder zusätzliche Kapitalrückzahlungen enthalten können. Der Plan wird jährlich überprüft und kann ohne Vorankündigung geändert oder eingestellt werden.
Portfolio-Positionierung und Ergebnisse. Das Team behielt Übergewichtungen in den Bereichen Wohnen, betreute Seniorenwohnanlagen und Hochschulbildung bei sowie eine „gebündelte“ Duration von 10 bis 20 Jahren. Die Verengung der Spreads unterstützte die Performance, während eine leicht lange Duration aufgrund eines Rückgangs der Treasury-Renditen um 52 Basispunkte belastete. Die Sektorallokation zum 30. April 2025 wurde von Gesundheitswesen (17,85 %), Verkehr (15,71 %) und Wohnen (12,86 %) angeführt.
Managementwechsel. Ab dem 30. September 2024 traten James Conn, Francisco Rivera, Daniel Workman und Benjamin C. Barber dem Portfoliomanagement-Team bei. Der langjährige Manager Paul M. Drury plant, am 30. Mai 2025 in den Ruhestand zu gehen.
Wesentliche Risiken und Offenlegungen. Der Trust weist auf Risiken durch Hebelwirkung, Zinsänderungen, Kreditrisiken und mögliche gesetzliche Risiken hin, einschließlich eines Vorschlags zur Abschaffung des steuerfreien Status von Kommunalanleihen. Etwa 24 % der Ausschüttungen im Geschäftsjahr 2025 bestanden aus Kapitalrückzahlungen, was den NAV mindern könnte, wenn dies nicht durch Gewinne ausgeglichen wird.
- Monthly distribution increased from $0.035 to $0.0393 per share effective 1 May 2025 (≈12 % increase).
- Market-price total return of +6.46 % materially outperformed NAV return and helped narrow the discount.
- Tightening municipal credit spreads contributed positively to performance, validating portfolio sector tilts.
- Expanded portfolio management team with four new managers adds depth ahead of a scheduled retirement.
- NAV total return (+1.43 %) lagged the Bloomberg Municipal Bond Index (+1.66 %), indicating minor underperformance.
- 24 % of FY-2025 distributions came from return of capital, raising sustainability concerns if earnings do not improve.
- Long duration stance detracted from performance during the period.
- Managed distribution plan may be amended or terminated at any time, which could adversely affect the share price.
Insights
TL;DR – Distribution boost offsets soft NAV performance; credit mix and leverage unchanged.
The 12 % increase in the managed monthly payout is a shareholder-friendly move that may narrow the discount, yet the reliance on a 24 % return-of-capital component underlines income-generation pressure. NAV underperformed the Bloomberg muni benchmark by 23 bp, largely due to a modest duration extension amid falling Treasury yields. Market-price return of +6.46 % suggests sentiment improved, aided by tighter muni spreads. Portfolio sector weights remain tilted toward housing and health care, areas that benefited from spread compression. Addition of four co-managers should deepen research resources before the May 2025 retirement of veteran Paul Drury. Overall impact is balanced: higher cash flow vs. sustainability concerns and benchmark lag.
TL;DR – Larger payout and tighter discount make filing modestly positive for investors.
The scheduled hike to $0.0393 monthly lifts the fund’s forward distribution yield by roughly 12 %, a meaningful catalyst for demand in a yield-hungry retail market. Even after including ROC, the higher cash distribution supports the board’s objective of reducing the share-price discount, already evidenced by a 22 ¢ market-price gain year-over-year. Leverage costs remain contained, and no adverse credit events were reported. While NAV growth trailed the index, the discrepancy is minor and partly offset by enhanced market returns. From a discount-capture and income perspective, this report tilts positive.
Putnam Municipal Opportunities Trust (NYSE: PMO) ha presentato il suo Modulo N-CSR per l'esercizio fiscale terminato il 30 aprile 2025. Il fondo chiuso mira a generare reddito esente da imposte federali investendo principalmente in obbligazioni municipali di alta qualità e selezionate ad alto rendimento, utilizzando inoltre leva finanziaria tramite azioni privilegiate. Nel periodo di 12 mesi, il fondo ha registrato un rendimento totale del +1,43% sul valore patrimoniale netto (NAV) e un rendimento totale del +6,46% sul prezzo di mercato. L'indice Bloomberg Municipal Bond ha restituito un +1,66% nello stesso intervallo. Il NAV è sceso da 11,17 a 10,92 dollari, mentre il prezzo di mercato è salito da 9,72 a 9,94 dollari, riducendo leggermente lo sconto sul prezzo di mercato.
Piano di distribuzione gestita. Fino al 30 aprile 2025 il fondo ha pagato una distribuzione mensile di 0,035 dollari per azione. A partire dal 1° maggio 2025 il consiglio ha aumentato la quota a 0,0393 dollari, segnando un incremento di circa il 12%. Nell'anno fiscale il fondo ha distribuito 0,42 dollari per azione, di cui 0,3182 dollari derivanti da reddito netto da investimenti e 0,1018 dollari (circa il 24%) come ritorno di capitale. La gestione sottolinea che, in caso di reddito insufficiente, i pagamenti futuri potrebbero includere plusvalenze a lungo termine o ulteriori ritorni di capitale. Il piano è rivisto annualmente e può essere modificato o interrotto senza preavviso.
Posizionamento e risultati del portafoglio. Il team ha mantenuto sovrappesi nei settori abitativo, comunità di assistenza continuativa e istruzione superiore, adottando inoltre una durata “bulleted” tra 10 e 20 anni. Il restringimento degli spread ha favorito la performance, mentre una posizione leggermente lunga in durata ha penalizzato a causa del calo di 52 punti base dei rendimenti dei Treasury. Al 30 aprile 2025, l'allocazione settoriale era guidata da Sanità (17,85%), Trasporti (15,71%) e Abitazioni (12,86%).
Cambiamenti nella gestione. Dal 30 settembre 2024, James Conn, Francisco Rivera, Daniel Workman e Benjamin C. Barber si sono uniti al team di gestione del portafoglio. Il manager di lunga data Paul M. Drury intende andare in pensione il 30 maggio 2025.
Rischi chiave e comunicazioni. Il trust evidenzia rischi legati alla leva finanziaria, ai tassi d'interesse, al credito e a potenziali rischi legislativi, inclusa una proposta di rimozione dello status esentasse per le obbligazioni municipali. Circa il 24% delle distribuzioni del FY-2025 è stato costituito da ritorno di capitale, che potrebbe ridurre il NAV se non compensato da guadagni.
Putnam Municipal Opportunities Trust (NYSE: PMO) presentó su Formulario N-CSR para el año fiscal finalizado el 30 de abril de 2025. El fondo cerrado busca ingresos exentos de impuestos federales invirtiendo principalmente en bonos municipales de grado de inversión y selectos de alto rendimiento, empleando apalancamiento a través de acciones preferentes. Durante el período de 12 meses, el fondo registró un rendimiento total del +1.43 % sobre el valor neto de los activos (NAV) y un rendimiento total del +6.46 % sobre el precio de mercado. El índice Bloomberg Municipal Bond retornó +1.66 % en el mismo período. El NAV bajó de $11.17 a $10.92, mientras que el precio de mercado subió de $9.72 a $9.94, reduciendo modestamente el descuento sobre el precio de mercado.
Plan de distribución gestionado. Hasta el 30 de abril de 2025, el fondo pagó una distribución mensual de $0.035 por acción. A partir del 1 de mayo de 2025, la junta aumentó la tasa a $0.0393, señalando un aumento aproximado del 12 %. Para el año fiscal, el fondo distribuyó $0.42 por acción, de los cuales $0.3182 fueron ingresos netos de inversión y $0.1018 (≈24 %) retorno de capital. La administración señala que, si los ingresos son insuficientes, los pagos futuros podrían incluir ganancias de capital a largo plazo o retornos adicionales de capital. El plan se revisa anualmente y puede ser modificado o terminado sin previo aviso.
Posicionamiento y resultados de la cartera. El equipo mantuvo sobreponderaciones en los sectores de vivienda, comunidades de retiro con cuidados continuos y educación superior, además de una postura de duración “bulleted” de 10 a 20 años. El estrechamiento de los diferenciales ayudó al desempeño, mientras que una postura ligeramente larga en duración afectó negativamente debido a la caída de 52 puntos básicos en los rendimientos del Tesoro. La asignación sectorial al 30 de abril de 2025 estuvo liderada por Salud (17.85 %), Transporte (15.71 %) y Vivienda (12.86 %).
Cambios en la gestión. A partir del 30 de septiembre de 2024, James Conn, Francisco Rivera, Daniel Workman y Benjamin C. Barber se unieron al equipo de gestión de cartera. El gestor de larga data Paul M. Drury planea retirarse el 30 de mayo de 2025.
Riesgos clave y divulgaciones. El fideicomiso destaca riesgos relacionados con apalancamiento, tasas de interés, crédito y posibles riesgos legislativos, incluida una propuesta para eliminar el estatus exento de impuestos de los bonos municipales. Aproximadamente el 24 % de las distribuciones del año fiscal 2025 constituyeron retorno de capital, lo que podría erosionar el NAV si no se compensa con ganancias.
Putnam Municipal Opportunities Trust (NYSE: PMO)는 2025년 4월 30일 종료된 회계연도에 대한 Form N-CSR을 제출했습니다. 이 폐쇄형 펀드는 주로 투자등급 및 일부 고수익 지방채에 투자하며 우선주를 통한 레버리지를 활용하여 연방 세금 면제 소득을 추구합니다. 12개월 동안 펀드는 순자산가치(NAV) 기준 +1.43% 총수익과 시장가격 기준 +6.46% 총수익을 기록했습니다. 같은 기간 블룸버그 지방채 지수는 +1.66%를 기록했습니다. NAV는 11.17달러에서 10.92달러로 하락한 반면, 시장가격은 9.72달러에서 9.94달러로 상승해 시장가격 할인폭이 다소 축소되었습니다.
관리 배당 계획. 2025년 4월 30일까지 펀드는 주당 월 0.035달러의 배당금을 지급했습니다. 2025년 5월 1일부터 이사회는 배당금을 주당 0.0393달러로 인상하여 약 12% 상승을 나타냈습니다. 회계연도 동안 펀드는 주당 0.42달러를 분배했으며, 이 중 0.3182달러는 순투자소득, 0.1018달러(약 24%)는 자본환급이었습니다. 운용팀은 소득이 부족할 경우 향후 지급액에 장기 자본이득 또는 추가 자본환급이 포함될 수 있다고 밝혔습니다. 이 계획은 매년 검토되며 사전 통보 없이 변경되거나 종료될 수 있습니다.
포트폴리오 포지셔닝 및 성과. 팀은 주택, 지속적 돌봄 은퇴 커뮤니티, 고등교육 부문에 대한 비중 확대를 유지했으며, 10~20년 만기의 '불릿'(duration) 전략을 취했습니다. 스프레드 축소가 성과에 도움이 되었으나, 국채 수익률이 52bp 하락하면서 다소 긴(duration) 포지션은 성과에 부정적 영향을 미쳤습니다. 2025년 4월 30일 기준 섹터별 비중은 보건(17.85%), 운송(15.71%), 주택(12.86%)이 주도했습니다.
운용진 변경. 2024년 9월 30일부터 James Conn, Francisco Rivera, Daniel Workman, Benjamin C. Barber가 포트폴리오 운용팀에 합류했습니다. 오랜 기간 운용을 맡아온 Paul M. Drury 매니저는 2025년 5월 30일 은퇴할 예정입니다.
주요 위험 및 공시사항. 신탁은 레버리지, 금리, 신용 및 지방채의 세금 면제 지위 제거 제안 등 잠재적 입법 위험을 강조합니다. 2025 회계연도 분배금의 약 24%가 자본환급으로 구성되어 있으며, 이는 수익으로 상쇄되지 않으면 NAV 감소를 초래할 수 있습니다.
Putnam Municipal Opportunities Trust (NYSE : PMO) a déposé son formulaire N-CSR pour l'exercice fiscal clos le 30 avril 2025. Ce fonds fermé vise à générer des revenus exonérés d'impôt fédéral en investissant principalement dans des obligations municipales de qualité investissement et certains titres à haut rendement, tout en utilisant un effet de levier via des actions privilégiées. Sur la période de 12 mois, le fonds a enregistré un rendement total de +1,43 % sur la valeur liquidative (NAV) et un rendement total de +6,46 % sur le prix de marché. L'indice Bloomberg Municipal Bond a affiché +1,66 % sur la même période. La NAV est passée de 11,17 $ à 10,92 $, tandis que le prix de marché est passé de 9,72 $ à 9,94 $, réduisant modestement l'écart de décote sur le prix de marché.
Plan de distribution géré. Jusqu'au 30 avril 2025, le fonds versait une distribution mensuelle de 0,035 $ par action. À compter du 1er mai 2025, le conseil d'administration a augmenté ce montant à 0,0393 $, soit une hausse d'environ 12 %. Sur l'exercice, le fonds a distribué 0,42 $ par action, dont 0,3182 $ de revenu net d'investissement et 0,1018 $ (≈24 %) de retour de capital. La direction indique que si les revenus sont insuffisants, les paiements futurs pourraient inclure des plus-values à long terme ou des retours de capital supplémentaires. Le plan est révisé annuellement et peut être modifié ou interrompu sans préavis.
Positionnement et résultats du portefeuille. L'équipe a maintenu des surpondérations dans les secteurs du logement, des communautés de retraite avec soins continus et de l'enseignement supérieur, ainsi qu'une position de duration « bulleted » de 10 à 20 ans. Le resserrement des écarts de crédit a soutenu la performance, tandis qu'une position légèrement longue en duration a pénalisé les résultats en raison de la baisse de 52 points de base des rendements du Trésor. L'allocation sectorielle au 30 avril 2025 était dominée par la santé (17,85 %), les transports (15,71 %) et le logement (12,86 %).
Changements dans la gestion. À compter du 30 septembre 2024, James Conn, Francisco Rivera, Daniel Workman et Benjamin C. Barber ont rejoint l'équipe de gestion de portefeuille. Le gestionnaire de longue date Paul M. Drury prévoit de prendre sa retraite le 30 mai 2025.
Principaux risques et divulgations. Le trust souligne les risques liés à l'effet de levier, aux taux d'intérêt, au crédit et aux risques législatifs potentiels, y compris une proposition visant à supprimer le statut d'exonération fiscale des obligations municipales. Environ 24 % des distributions de l'exercice 2025 étaient constituées de retour de capital, ce qui pourrait réduire la NAV si cela n'est pas compensé par des gains.
Putnam Municipal Opportunities Trust (NYSE: PMO) hat seinen Form N-CSR für das am 30. April 2025 endende Geschäftsjahr eingereicht. Der geschlossene Fonds verfolgt steuerlich freigestellte Bundeserträge, indem er hauptsächlich in Investment-Grade- und ausgewählte Hochzinskommunalanleihen investiert und dabei Hebelwirkung über Vorzugsaktien einsetzt. Im 12-Monats-Zeitraum erzielte der Fonds eine Gesamtrendite von +1,43 % auf den Nettoinventarwert (NAV) und eine Gesamtrendite von +6,46 % auf den Marktpreis. Der Bloomberg Municipal Bond Index erzielte im gleichen Zeitraum +1,66 %. Der NAV sank von 11,17 auf 10,92 US-Dollar, während der Marktpreis von 9,72 auf 9,94 US-Dollar stieg, wodurch der Abschlag auf den Marktpreis leicht verringert wurde.
Geleiteter Ausschüttungsplan. Bis zum 30. April 2025 zahlte der Fonds eine monatliche Ausschüttung von 0,035 US-Dollar je Aktie. Ab dem 1. Mai 2025 erhöhte der Vorstand die Ausschüttung auf 0,0393 US-Dollar, was einer Steigerung von etwa 12 % entspricht. Im Geschäftsjahr verteilte der Fonds 0,42 US-Dollar je Aktie, davon entfielen 0,3182 US-Dollar auf Nettoanlageerträge und 0,1018 US-Dollar (≈24 %) auf Kapitalrückzahlungen. Das Management weist darauf hin, dass bei unzureichenden Einnahmen zukünftige Zahlungen langfristige Kapitalgewinne oder zusätzliche Kapitalrückzahlungen enthalten können. Der Plan wird jährlich überprüft und kann ohne Vorankündigung geändert oder eingestellt werden.
Portfolio-Positionierung und Ergebnisse. Das Team behielt Übergewichtungen in den Bereichen Wohnen, betreute Seniorenwohnanlagen und Hochschulbildung bei sowie eine „gebündelte“ Duration von 10 bis 20 Jahren. Die Verengung der Spreads unterstützte die Performance, während eine leicht lange Duration aufgrund eines Rückgangs der Treasury-Renditen um 52 Basispunkte belastete. Die Sektorallokation zum 30. April 2025 wurde von Gesundheitswesen (17,85 %), Verkehr (15,71 %) und Wohnen (12,86 %) angeführt.
Managementwechsel. Ab dem 30. September 2024 traten James Conn, Francisco Rivera, Daniel Workman und Benjamin C. Barber dem Portfoliomanagement-Team bei. Der langjährige Manager Paul M. Drury plant, am 30. Mai 2025 in den Ruhestand zu gehen.
Wesentliche Risiken und Offenlegungen. Der Trust weist auf Risiken durch Hebelwirkung, Zinsänderungen, Kreditrisiken und mögliche gesetzliche Risiken hin, einschließlich eines Vorschlags zur Abschaffung des steuerfreien Status von Kommunalanleihen. Etwa 24 % der Ausschüttungen im Geschäftsjahr 2025 bestanden aus Kapitalrückzahlungen, was den NAV mindern könnte, wenn dies nicht durch Gewinne ausgeglichen wird.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-07626
Putnam Municipal Opportunities Trust
(Exact name of registrant as specified in charter)
100 Federal Street, Boston, Massachusetts 02110
(Address of principal executive offices) (Zip code)
Marc A. De Oliveira
Franklin Templeton
100 First Stamford Place
Stamford, CT 06902
(Name and address of agent for service)
Registrant’s telephone number, including area code: (617) 292-1000
Date of fiscal year end: April 30
Date of reporting period: April 30, 2025
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| ITEM 1. | REPORT TO STOCKHOLDERS. |
(a) The Report to Shareholders is filed herewith
(b) Not applicable
| ITEM 2. | CODE OF ETHICS. |
(a) The Registrant has adopted a code of ethics that applies to its principal executive officers and principal financial and accounting officer.
(c) N/A
(d) N/A
(f) Pursuant to Item 19(a) (1), the Registrant is attaching as an exhibit a copy of its code of ethics that applies to its principal executive officers and principal financial and accounting officer.
| ITEM 3. | AUDIT COMMITTEE FINANCIAL EXPERT. |
The Board of Trustees of the Registrant has determined that Eileen A. Kamerick and Nisha Kumar possess the technical attributes identified in Item 3 to Form N-CSR to qualify as “audit committee financial experts,” and has designated Eileen A. Kamerick and Nisha Kumar as the Audit Committee’s financial experts. Eileen A. Kamerick and Nisha Kumar are “independent” Trustees pursuant to paragraph (a)(2) of Item 3 to Form N-CSR.
Under applicable securities laws, a person determined to be an audit committee financial expert will not be deemed an “expert” for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and board of directors in the absence of such designation or identification. The designation or identification of a person as an audit committee financial expert does not affect the duties, obligations, or liability of any other member of the audit committee or board of directors.
| ITEM 4. | PRINCIPAL ACCOUNTANT FEES AND SERVICES. |
(a) Audit Fees. The aggregate fees billed in the last two fiscal years ending April 30, 2024 and April 30, 2025 (the “Reporting Periods”) for professional services rendered by the Registrant’s principal accountant (the “Auditor”) for the audit of the Registrant’s annual financial statements, or services that are normally provided by the Auditor in connection with the statutory and regulatory filings or engagements for the Reporting Periods, were $67,210 in April 30, 2024 and $64,772 in April 30, 2025.
(b) Audit-Related Fees. The aggregate fees billed in the Reporting Periods for assurance and related services by the Auditor that are reasonably related to the performance of the Registrant’s financial statements were $0 in April 30, 2024 and $0 in April 30, 2025.
(c) Tax Fees. The aggregate fees billed in the Reporting Periods for professional services rendered by the Auditor for tax compliance, tax advice and tax planning (“Tax Services”) were $9,600 in April 30, 2024 and $16,000 in April 30, 2025. These services consisted of (i) review or preparation of U.S. federal, state, local and excise tax returns; (ii) U.S. federal, state and local tax planning, advice and assistance regarding statutory, regulatory or administrative developments, and (iii) tax advice regarding tax qualification matters and/or treatment of various financial instruments held or proposed to be acquired or held.
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(d) All Other Fees. The aggregate fees billed in the Reporting Periods for products and services provided by the Auditor to the Registrant, other than the services reported in paragraphs (a) through (c) of this item, were $0 in April 30, 2024 and $0 in April 30, 2025.
There were no other non-audit services rendered by the Auditor to the Service Affiliates requiring pre-approval by the Audit Committee in the Reporting Periods.
(e) Audit Committee’s pre–approval policies and procedures described in paragraph (c) (7) of Rule 2-01 of Regulation S-X.
(1) The Charter for the Audit Committee (the “Committee”) of the Board of each registered investment company (the “Fund”) advised by the Registrant’s investment manager or one of their affiliates (each, an “Adviser”) requires that the Committee shall approve (a) all audit and permissible non-audit services to be provided to the Fund and (b) all permissible non-audit services to be provided by the Fund’s independent auditors to the Adviser and any service providers controlling, controlled by or under common control with the Adviser that provide ongoing services to the Fund (“Covered Service Providers”) if the engagement relates directly to the operations and financial reporting of the Fund. The Committee may implement policies and procedures by which such services are approved other than by the full Committee.
The Committee shall not approve non-audit services that the Committee believes may impair the independence of the auditors. As of the date of the approval of this Audit Committee Charter, permissible non-audit services include any professional services (including tax services), that are not prohibited services as described below, provided to the Fund by the independent auditors, other than those provided to the Fund in connection with an audit or a review of the financial statements of the Fund. Permissible non-audit services may not include: (i) bookkeeping or other services related to the accounting records or financial statements of the Fund; (ii) financial information systems design and implementation; (iii) appraisal or valuation services, fairness opinions or contribution-in-kind reports; (iv) actuarial services; (v) internal audit outsourcing services; (vi) management functions or human resources; (vii) broker or dealer, investment adviser or investment banking services; (viii) legal services and expert services unrelated to the audit; and (ix) any other service the Public Company Accounting Oversight Board determines, by regulation, is impermissible.
Pre-approval by the Committee of any permissible non-audit services is not required so long as: (i) the aggregate amount of all such permissible non-audit services provided to the Fund, the Adviser and the Covered Service Providers constitutes not more than 5% of the total amount of revenues paid to the independent auditors during the fiscal year in which the permissible non-audit services are provided to (a) the Fund, (b) the Adviser and (c) any entity controlling, controlled by or under common control with the Adviser that provides ongoing services to the Fund during the fiscal year in which the services are provided that would have to be approved by the Committee; (ii) the permissible non-audit services were not recognized by the Fund at the time of the engagement to be non-audit services; and (iii) such services are promptly brought to the attention of the Committee and approved by the Committee (or its delegate(s)) prior to the completion of the audit.
(2) None of the services described in paragraphs (b) through (d) of this Item were performed in reliance on paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
(f) Not applicable.
(g) Non-audit fees billed by the Auditor for services rendered to the Registrant and the Service Affiliates during the reporting period were $664,363 in April 30, 2024 and $486,647 in April 30, 2025.
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(h) Yes. The Registrant’s Audit Committee has considered whether the provision of non-audit services that were rendered to Service Affiliates, which were not pre-approved (not requiring pre-approval), is compatible with maintaining the Auditor’s independence. All services provided by the Auditor to the Registrant or to the Service Affiliates, which were required to be pre-approved, were pre-approved as required.
(i) Not applicable.
(j) Not applicable
| ITEM 5. | AUDIT COMMITTEE OF LISTED REGISTRANTS. |
(a) The independent board members are acting as the registrant’s audit committee as specified in Section 3(a)(58)(B) of the Exchange Act. The Audit Committee consists of the following Board members:
Robert D. Agdern
Carol L. Colman
Anthony Grillo
Eileen A. Kamerick
Nisha Kumar
Peter Mason
Hillary A. Sale
(b) Not applicable
| ITEM 6. | SCHEDULE OF INVESTMENTS. |
| (a) | Please see schedule of investments contained in the Financial Statements and Financial Highlights included under Item 1 of this Form N-CSR. |
| (b) | Not applicable. |
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| ITEM 7. | FINANCIAL STATEMENTS AND FINANCIAL HIGHLIGHTS FOR OPEN-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| ITEM 8. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS FOR OPEN-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| ITEM 9. | PROXY DISCLOSURES FOR OPEN-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| ITEM 10. | REMUNERATION PAID TO DIRECTORS, OFFICERS, AND OTHERS OF OPEN-END MANAGEMENT INVESTMENT COMPANIES. |
Not applicable.
| ITEM 11. | STATEMENT REGARDING BASIS FOR APPROVAL OF INVESTMENT ADVISORY CONTRACT. |
The information is disclosed as part of the Financial Statements included in Item 1 of this Form N-CSR, as applicable.
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| ITEM 12. | DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
Putnam Investments
Proxy Voting Procedures
Introduction and Summary
Many of Putnam’s investment management clients have delegated to Putnam the authority to vote proxies for shares in the client accounts Putnam manages. Putnam believes that the voting of proxies can be an important tool for institutional investors to promote best practices in corporate governance and votes all proxies in the best interests of its clients as investors. In Putnam’s view, strong corporate governance policies, most notably oversight by an independent board of qualified directors, best serve investors’ interests. Putnam will vote proxies and maintain records of voting of shares for which Putnam has proxy voting authority in accordance with its fiduciary obligations and applicable law.
Putnam’s voting policies are rooted in our views that (1) strong, independent corporate governance is important to long-term company financial performance, and (2) long-term investors’ active engagement with company management, including through the proxy voting process, strengthens issuer accountability and overall market discipline, potentially reducing risk and improving returns over time. Our voting program is offered as a part of our investment management services, at no incremental fee to Putnam, and, while there can be no guarantees, it is intended to offer potential investment benefits over a long-term horizon. Our voting policies are designed with investment considerations in mind, not as a means to pursue particular political, social, or other goals. As a result, we may not support certain proposals whose costs to the issuer (including implementation costs, practicability, and other factors), in Putnam’s view, outweigh their investment merits.
This memorandum sets forth Putnam’s policies for voting proxies. It covers all accounts for which Putnam has proxy voting authority. These accounts include the Putnam Mutual Funds1 and Putnam Exchange-Traded Funds, US and international institutional accounts and funds managed or sub-advised by The Putnam Advisory Company, LLC, Putnam Investments Limited and Putnam Fiduciary Trust Company, LLC. In addition, the policies include US mutual funds and other accounts sub-advised by Putnam Investment Management, LLC.2
Proxy Committee
Putnam has a Proxy Committee composed of senior professionals, including from the Putnam Equity investment team and the Putnam Equity Sustainability Strategy group. The Chief Investment Officer of Putnam Equity appoints the members of the Proxy Committee. The Proxy Committee is responsible for setting general policy as to proxies. Specifically, the Committee:
| 1. | Reviews these procedures and the Proxy Voting Guidelines annually and approves any amendments considered to be advisable. |
1 Effective January 27, 2023, the Board of Trustees of the Putnam Mutual Funds delegated proxy voting authority to Putnam Investment Management, LLC, the investment manager to the Putnam Mutual Funds.
2 The Putnam Proxy Voting Procedures and Guidelines will apply also to certain funds and institutional and other accounts managed by Franklin Advisers, Inc. (“FAV”) but formerly managed or sub-advised by one of the Putnam adviser entities identified above, pursuant to sub-advisory agreements in effect from time to time between FAV and the relevant Putnam entity(ies).
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| 2. | Considers special proxy issues as they may from time to time arise. |
| 3. | Must approve all vote overrides recommended by investment professionals. |
Proxy Voting Administration
The Putnam Sustainability Strategy group administers Putnam’s proxy voting through a Proxy Voting Team. The Proxy Voting Team has the following duties:
| 1. | Annually prepares the Proxy Voting Guidelines and distributes them to the Proxy Committee for review. |
| 2. | Coordinates the Proxy Committee’s review of any new or unusual proxy issues and serves as Secretary thereto. |
| 3. | Manages the process of referring issues to portfolio managers for voting instructions. |
| 4. | Oversees the work of any third-party vendor hired to process proxy votes (as of the date of these procedures Putnam has engaged Institutional Shareholder Services (ISS) to process proxy votes) and the process of setting up the voting process with ISS and custodial banks for new clients. |
| 5. | Coordinates responses to investment professionals’ questions on proxy issues and proxy policies, including forwarding specialized proxy research from ISS and other vendors and forwards information to investment professionals prepared by other areas at Putnam. |
| 6. | Implements the exception process with respect to referred items on securities held solely in accounts managed by the Global Asset Allocation (“GAA”) team within Franklin Templeton Investment Solutions described in more detail in the Proxy Referral section below. |
| 7. | Maintains required records of proxy votes on behalf of the appropriate Putnam client accounts. |
| 8. | Prepares and distributes reports required by Putnam clients. |
Proxy Voting Guidelines
Putnam maintains written voting guidelines (“Guidelines”) setting forth voting positions determined by the Proxy Committee on those issues believed most likely to arise day to day. The Guidelines may call for votes to be cast normally in favor of or opposed to a matter or may deem the matter an item to be referred to investment professionals on a case-by-case basis. A copy of the Guidelines is attached to this memorandum as Exhibit A.
In light of our views on the importance of issuer governance and investor engagement, which we believe are applicable across our various strategies and clients, regardless of a specific portfolio’s investment objective, Putnam will vote all proxies in accordance with the Guidelines, subject to two exceptions as follows:
| 1. | If the portfolio managers of client accounts holding the stock of a company with a proxy vote believe that following the Guidelines in any specific case would not be in the clients’ best interests, they may request the Proxy Voting Team not to follow the guidelines in such case. The request must be in writing and include an explanation of the rationale for doing so. The Proxy Voting Team will review any such request with the Proxy Committee (or, in cases with limited time, with the Chair of the Proxy Committee acting on the Proxy Committee’s behalf) prior to implementing the request. |
| 2. | Putnam may accept instructions to vote proxies under client specific guidelines subject to review and acceptance by the Investment Division and the Legal and Compliance Department. |
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Other
| 1. | Putnam may elect not to vote when the security is no longer held. |
| 2. | Putnam will abstain on items that require case-by-case review when a vote recommendation from the appropriate investment professional(s) cannot be obtained due to restrictive voting deadlines or other prohibitive operational or administrative requirements. |
| 3. | Where securities held in Putnam client accounts, including the Putnam mutual funds, have been loaned to third parties in connection with a securities lending program administered by Putnam (through securities lending agents overseen by Putnam), Putnam has instructed lending agents to recall U.S. securities on loan to vote proxies, in accordance with Putnam’s securities lending procedures. Due to differences in non-U.S. markets, Putnam does not currently seek to recall non-U.S. securities on loan. In addition, where Putnam does not administer a client’s securities lending program, this recall policy does not apply, since Putnam generally does not have information on loan details or authority to effect recalls in those cases. It is possible that, for impracticability or other reasons, a recalled security may not be returned to the relevant custodian in time to allow Putnam to vote the relevant proxy. |
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| 4. | Putnam will make its reasonable best efforts to vote all proxies except when impeded by circumstances that are reasonably beyond its control and responsibility, such as custodial proxy voting services, in part or whole, not available or not established by a client, or custodial error. |
Proxy Voting Referrals
Under the Guidelines, certain proxy matters will be referred to Portfolio Managers. The Portfolio Manager receiving the referral request may delegate the vote decision to an appropriate Analyst from among a list of eligible analysts (such list to be approved by the Chief Investment Officer of the Putnam Equity group and the Director of Equity Research for the Putnam Equity group). The Analyst will be required to make the affirmation and disclosures identified in (3) below. Normally specific referral items will be referred to the portfolio team leader (or another member of the portfolio team he or she designates) whose accounts hold the greatest number of shares of the issuer of the proxies through the Proxy Referral Administration Database. The referral request contains (1) a field that will be used by the portfolio team leader or member for recommending a vote on each referral item, (2) a field for describing any contacts relating to the proxy referral item the portfolio team may have had with any Franklin Templeton employee outside Putnam Equity or with any person other than a proxy solicitor acting in the normal course of proxy solicitation, and (3) a field for portfolio managers to affirm that they are making vote recommendations in the best interest of client accounts and have disclosed to Compliance any potential conflicts of interest relevant to their vote recommendation.
Putnam may vote any referred items on securities held solely in accounts managed by the GAA team within Franklin Templeton Investment Solutions (and not held by any other investment product team) in accordance with the recommendation of Putnam’s third-party proxy voting service provider. The Proxy Voting Team will first give the relevant portfolio manager(s) on the GAA team the opportunity to review the referred items and vote on them. If the portfolio manager(s) on the GAA team do not decide to make any active voting decision on any of the referred items, the items will be voted in accordance with the service provider’s recommendation. If the security is also held by other investment teams at Putnam Equity, the items will be referred to the largest holder who is not a member of the GAA team.
The portfolio team leader or members who have been requested to provide a recommendation on a proxy referral item will complete the referral request. Upon receiving each completed referral request from the applicable Portfolio Manager or Analyst, the Proxy Voting Team will review the completed request for accuracy and completeness, and will follow up with investment personnel as appropriate.
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Conflicts of Interest
A potential conflict of interest may arise when voting proxies of an issuer which has a significant business relationship with Putnam. For example, Putnam could manage a defined benefit or defined contribution pension plan for the issuer. Putnam’s policy is to vote proxies based solely on the investment merits of the proposal. In order to guard against conflicts, the following procedures have been adopted:
| 1. | The Proxy Committee is composed of senior professionals, including Portfolio Managers in Putnam Equity and the Putnam Equity Sustainability Strategy group. None of these individuals or groups reports to Franklin Templeton’s marketing businesses. |
| 2. | No Franklin Templeton employee outside Putnam Equity may contact any portfolio manager about any proxy vote without first contacting the Proxy Voting Team or a senior lawyer in the Legal and Compliance Department. There is no prohibition on employees seeking to communicate investment-related information to investment professionals except for Putnam’s restrictions on dissemination of material, non-public information. However, the Proxy Voting Team will coordinate the delivery of such information to investment professionals to avoid appearances of conflict. |
| 3. | Investment professionals responding to referral requests must disclose any contacts with third parties other than normal contact with proxy solicitation firms and must affirm that they are making vote recommendations in the best interest of client accounts and have disclosed to the Proxy Voting Team any potential conflicts of interest relevant to their vote recommendation. |
| 4. | The Proxy Voting Team will review the name of the issuer of each proxy that contains a referral item against various sources of Putnam business relationships maintained by the Legal and Compliance Department or Client Service for potential material business relationships (i.e., conflicts of interest). For referrals, the Proxy Voting Team will complete the Proxy Voting Conflict of Interest Disclosure Form (attached as Exhibit B and C) via the Proxy Referral Administration Database and will prepare a quarterly report for the Putnam Chief Compliance Officer identifying all completed Conflict of Interest Disclosure forms. |
| 5. | Putnam’s Proxy Voting Guidelines may only be overridden with the written recommendation from a member of the Investment Division and concurrence of the Proxy Committee (or, in cases with limited time, with the Chair of the Proxy Committee on the Proxy Committee’s behalf). |
Recordkeeping
The Putnam Equity Sustainability Strategy Group will retain copies of the following books and records:
| 1. | A copy of the Proxy Voting Procedures and Guidelines as are from time to time in effect; |
| 2. | A copy of each proxy statement received with respect to securities in client accounts; |
| 3. | Records of each vote cast for each client; |
| 4. | Internal documents generated in connection with a proxy referral, such as emails, memoranda, etc. |
| 5. | Written reports to clients on proxy voting and all client requests for information and Putnam’s response. |
All records will be maintained for seven years. A proxy vendor may on Putnam’s behalf maintain the records noted in 2 and 3 above if it commits to providing copies promptly upon request.
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Exhibit A to Proxy Procedures
Putnam Investments Proxy Voting Guidelines
The proxy voting guidelines below summarize Putnam’s positions on various issues of concern to investors and indicate how client portfolio securities will be voted on proposals dealing with a particular issue. The proxy voting service is instructed to vote all proxies relating to client portfolio securities in accordance with these guidelines, except as otherwise instructed by the Proxy Voting Team.
Putnam’s voting policies are rooted in our views that (1) strong, independent corporate governance is important to long-term company financial performance, and (2) long-term investors’ active engagement with company management, including through the proxy voting process, strengthens issuer accountability and overall market discipline, potentially reducing risk and improving returns over time. Our voting program is offered as a part of our investment management services, at no incremental fee to Putnam, and, while there can be no guarantees, it is intended to offer potential investment benefits over a long-term horizon. Our voting policies are designed with investment considerations in mind, not as a means to pursue particular political, social, or other goals. As a result, we may not support certain proposals whose costs to the issuer (including implementation costs, practicability, and other factors), in Putnam’s view, outweigh their investment merits.
These proxy voting policies are intended to be decision-making guidelines. The guidelines are not exhaustive and do not include all potential voting issues. In addition, as contemplated by and subject to Putnam’s Proxy Voting Procedures, because proxy issues and the circumstances of individual companies are so varied, portfolio teams may recommend votes that may vary from the general policy choices set forth in the guidelines.
The following guidelines are grouped according to the types of proposals generally presented to shareholders. Part I deals with proposals which have been approved and recommended by a company’s board of directors. Part II deals with proposals submitted by shareholders for inclusion in proxy statements. Part III addresses unique considerations pertaining to non-US issuers.
I. Board-Approved Proposals
Proxies will be voted for board-approved proposals, except as follows:
A. Matters Relating to the Board of Directors
Uncontested Election of Directors
The board of directors has the important role of overseeing management and its performance on behalf of shareholders. When evaluating a company’s board, Putnam may consider the diversity of professional backgrounds and personal characteristics. Putnam believes that companies generally benefit from diversity on the board, including diversity with respect to gender, ethnicity, race, skills, perspectives and experience.
Proxies will be voted for the election of the company’s nominees for directors (and/or subsidiary directors) and for board-approved proposals on other matters relating to the board of directors (provided that such nominees and other matters have been approved by an independent nominating committee), except as follows:
| Ø | Putnam will withhold votes from the entire board of directors if: |
| · | The board does not have a majority of independent directors, |
| · | The board does not have nominating, audit and compensation committees composed solely of independent directors, or |
| · | The board has more than 15 members or fewer than five members, absent special circumstances. |
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| Ø | Putnam may refrain from withholding votes from the board due to insufficient key committee independence due to director resignation, change in board structure, or other specific circumstances, provided that the company has stated (for example in an 8-K), or it can otherwise be determined, that the board will address committee composition to ensure compliance with the applicable corporate governance code in a timely manner after the shareholder meeting and the company has a history of appropriate board independence. |
Unless otherwise indicated, for the purposes of determining whether a board has a majority of independent directors and independent nominating, audit, and compensation committees, an independent director is a director who (1) meets all requirements to serve as an independent director of a company under the final NYSE Corporate Governance Rules (e.g., no material business relationships with the company and no present or recent employment relationship with the company (including employment of an immediate family member as an executive officer)), and (2) has not accepted directly or indirectly any consulting, advisory, or other compensatory fee (excluding immaterial fees for transactional services as defined by the NYSE Corporate Governance rules) from the company other than in his or her capacity as a member of the board of directors or any board committee. Putnam believes that the receipt of such compensation for services other than service as a director raises significant independence issues.
| Ø | Putnam will withhold votes from any nominee for director who is considered an independent director by the company and who has received compensation within the last three years from the company for the provision of professional services (e.g., investment banking, consulting, legal or financial advisory fees). |
| Ø | Putnam will withhold votes from any nominee for director who attends fewer than 75% of board and committee meetings. Putnam may refrain from withholding votes on a case-by-case basis if a valid reason for the absence exists, such as illness, personal emergency, potential conflict of interest, etc. |
| Ø | Putnam will withhold votes from any incumbent nominee for director who served on a board that has not acted to implement a policy requested in a shareholder proposal that received the support of a majority of the votes actually cast on the matter at its previous two annual meetings, or |
| Ø | Putnam will withhold votes from any incumbent nominee for director who served on a board that adopted, renewed, or made a material adverse modification to a shareholder rights plan (commonly referred to as a “poison pill”) without shareholder approval during the current or prior calendar year. (This is applicable to any type of poison pill, for example, advance-warning type pill, EGM pill, and Trust Defense Plans in Japan.) |
Putnam will refrain from opposing the board members who served at the time of the adoption of the poison pill if the duration is one year or less, if the plan contains other suitable restrictions; or if the company publicly discloses convincing rationale for its adoption and seeks shareholder approval of future renewals of the poison pill. (Suitable restrictions could include but are not limited to, a higher threshold for passive investors. Convincing rationale could include circumstances such as, but not limited to, extreme market disruption or conditions, stock volatility, substantial merger, active investor interest, or takeover attempts.)
| Ø | Putnam will vote on a case-by-case basis and may consider voting against the Nominating Committee Chair if there is a lack of evidence of board diversity. |
Putnam is concerned about over-committed directors. In some cases, directors may serve on too many boards to make a meaningful contribution. This may be particularly true for senior executives of public companies (or other directors with substantially full-time employment) who serve on more than a few outside boards.
| Ø | Putnam will vote against any non-executive nominee for director who serves on more than four (4) public company boards, except where Putnam would otherwise be withholding votes for the entire board of directors. For the purpose of this guideline, boards of affiliated registered investment companies and other similar entities such as UCITS will count as one board. Generally, Putnam will |
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withhold support from directors serving on more than four unaffiliated public company boards, although an exception may be made in the case of a director who represents an investing firm with the sole purpose of managing a portfolio of investments that includes the company.
| Ø | Putnam will withhold votes from any nominee for director who serves as an executive officer of any public company (“home company”) while serving on more than two (2) public company boards other than the home company board. (Putnam will withhold votes from the nominee at each company where Putnam client portfolios own shares.) In addition, if Putnam client portfolios are shareholders of the executive’s home company, Putnam will withhold votes from members of the company’s governance committee. For the purpose of this guideline, boards of affiliated registered investment companies and other similar entities such as UCITS will count as one board. |
| Ø | Putnam will withhold votes from any nominee for director of a public company (Company A) who is employed as a senior executive of another public company (Company B) if a director of Company B serves as a senior executive of Company A (commonly referred to as an “interlocking directorate”). |
Board independence depends not only on its members’ individual relationships, but also the board’s overall attitude toward management. Independent boards are committed to good corporate governance practices and, by providing objective independent judgment, enhancing shareholder value. Putnam may withhold votes on a case-by-case basis from some or all directors that, through their lack of independence, have failed to observe good corporate governance practices or, through specific corporate action, have demonstrated a disregard for the interest of shareholders.
Note: Designation of executive director is based on company disclosure.
| Ø | Putnam will vote against proposals that provide that a director may be removed only for cause. Putnam will generally vote for proposals that permit the removal of directors with or without cause. |
| Ø | Putnam will vote against proposals authorizing a board to fill a director vacancy without shareholder approval. |
| Ø | Putnam will vote on a case-by-case basis on subsidiary director nominees if Putnam will be voting against the nominees of the parent company’s board. |
| Ø | Putnam will vote on a case-by-case basis for director nominees, including nominees for positions on Supervisory Boards or Supervisory Committees, or similar board entities (depending on board structure), for (re)election when cumulative voting applies. |
| Ø | Putnam will vote for proposals to approve annual directors’ fees, except that Putnam will vote on a case-by-case basis if Putnam’s independent proxy voting service has recommended a vote against such proposal. Additionally, Putnam will vote for proposals to approve the grant of equity awards to directors, except that Putnam will consider these proposals on a case-by-case basis if Putnam’s proxy service provider is recommending a vote against the proposal. |
Classified Boards
| Ø | Putnam will vote against proposals to classify a board, absent special circumstances indicating that shareholder interests would be better served by this structure. |
Ratification of Auditors
| Ø | Putnam will vote on a case-by-case basis on proposals to ratify the selection of independent auditors if there is evidence that the audit firm’s independence or the integrity of an audit is compromised. (Otherwise, Putnam will vote for.) |
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Contested Elections of Directors
| Ø | Putnam will vote on a case-by-case basis in contested elections of directors. |
B. Executive Compensation
Putnam will vote on a case-by-case basis on board-approved proposals relating to executive compensation, except as follows:
| Ø | Putnam will vote for stock option and restricted stock plans that will result in an average annual dilution of 1.67% or less (based on the disclosed term of the plan and including all equity-based plans), except where Putnam would otherwise be withholding votes for the entire board of directors in which case Putnam will evaluate the plans on a case-by-case basis. |
| Ø | Putnam will vote against stock option and restricted stock plans that will result in an average annual dilution of greater than 1.67% (based on the disclosed term of the plan and including all equity plans). |
| Ø | Putnam will vote against any stock option or restricted stock plan where the company’s actual grants of stock options and restricted stock under all equity-based compensation plans during the prior three (3) fiscal years have resulted in an average annual dilution of greater than 1.67%. |
| · | Additionally, if the annualized dilution cannot be calculated, Putnam will vote for plans where the Total Potential Dilution is 5% or less. If the annualized dilution cannot be calculated and the Total Potential Dilution exceeds 5%, then Putnam will vote against. Note: Such plans must first pass all of Putnam’s other screens. |
| Ø | Putnam will vote proposals to issue equity grants to executives on a case-by-case basis. |
| Ø | Putnam will vote against stock option plans that permit replacing or repricing of underwater options (and against any proposal to authorize such replacement or repricing of underwater options). |
| Ø | Putnam will vote against stock option plans that permit issuance of options with an exercise price below the stock’s current market price. |
| Ø | Putnam will vote against stock option plans/ restricted stock plans with evergreen features providing for automatic share replenishment. |
| · | Putnam will vote for bonus plans under which payments are treated
as performance-based compensation that is deductible under Section 162(m) of the Internal Revenue Code of 1986, as amended, except as
follows: |
Vote on a case-by-case basis on such proposals if any of the following circumstances exist:
| o | the amount per employee under the plan is unlimited, or |
| o | the maximum award pool is undisclosed, or |
| o | the incentive bonus plan’s performance criteria are undisclosed, or |
| o | the independent proxy voting service recommends a vote against. |
| Ø | Putnam will vote in favor of the annual presentation of advisory votes on executive compensation (Say-on-Pay). |
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Putnam will generally vote for advisory votes on executive compensation (Say-on-Pay). However, Putnam will vote against an advisory vote if the company fails to effectively link executive compensation to company performance according to benchmarking performed by the independent proxy voting service. |
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| · | Putnam will review the proposal on a case-by-case basis if there is no recommendation of the independent proxy voting service. |
| Ø | Putnam will vote on a case-by-case basis on severance agreements (e.g., golden and tin parachutes) |
| Ø | Putnam will withhold votes from members of a Board of Directors which has approved compensation arrangements Putnam’s investment personnel have determined are grossly unreasonable at the next election at which such director is up for re-election. |
| Ø | Putnam will vote for employee stock purchase plans that have the following features: (1) the shares purchased under the plan are acquired for no less than 85% of their market value, (2) the offering period under the plan is 27 months or less, and (3) dilution is 10% or less. |
| Ø | Putnam will vote for Non-qualified Employee Stock Purchase Plans with all the following features: |
1) Broad-based participation (i.e., all employees of the company with the exclusion of individuals with 5 percent or more of beneficial ownership of the company).
2) Limits on employee contribution, which may be a fixed dollar amount or expressed as a percent of base salary.
3) Company matching contribution up to 25 percent of employee’s contribution, which is effectively a discount of 20 percent from market value.
4) No discount on the stock price on the date of purchase since there is a company matching contribution.
Putnam will vote against Non-qualified Employee Stock Purchase Plans when any of the plan features do not meet the above criteria.
Putnam may vote against executive compensation proposals on a case-by-case basis where compensation is excessive by reasonable corporate standards, or where a company fails to provide transparent disclosure of executive compensation. In voting on proposals relating to executive compensation, Putnam will consider whether the proposal has been approved by an independent compensation committee of the board.
C. Capitalization
Putnam will vote on a case-by-case basis on board-approved proposals involving changes to a company’s capitalization, except as follows:
| Ø | Putnam will vote for proposals relating to the authorization of additional common stock, except that Putnam will evaluate such proposals on a case-by-case basis if (i) they relate to a specific transaction or to common stock with special voting rights, (ii) the company has a non-shareholder approved poison pill in place, or (iii) the company has had sizeable stock placements to insiders within the past three years at prices substantially below market value without shareholder approval. |
| Ø | Putnam will vote for proposals to effect stock splits (excluding reverse stock splits.) |
| Ø | Putnam will vote for proposals authorizing share repurchase programs, except that Putnam will vote on a case-by-case basis if there are concerns that there may be abusive practices related to the share repurchase programs. |
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| D. | Acquisitions, Mergers, Reorganizations and |
Other Transactions
Putnam will vote on a case-by-case basis on business transactions such as acquisitions, mergers, reorganizations involving business combinations, liquidations and sale of all or substantially all of a company’s assets.
E. Anti-Takeover Measures
Putnam will vote against board-approved proposals to adopt anti-takeover measures such as supermajority voting provisions, issuance of blank check preferred stock, the creation of a separate class of stock with disparate voting rights, control share acquisition provisions, targeted share placements, and ability to make greenmail payments, except as follows:
| Ø | Putnam will vote on a case-by-case basis on proposals to ratify or approve shareholder rights plans; |
| Ø | Putnam will vote on a case-by-case basis on proposals to adopt fair price provisions. |
| Ø | Putnam will vote on a case-by-case basis on proposals to issue blank check preferred stock in the case of REITs (only). |
| Ø | Putnam will generally vote for proposals that enable or expand shareholders’ ability to take action by written consent. |
| Ø | Putnam will vote on a case-by-case basis on proposals to increase shares of an existing class of stock with disparate voting rights from another share class. |
| Ø | Putnam will vote on a case-by-case basis on shareholder or board-approved proposals to eliminate supermajority voting provisions at controlled companies (companies in which an individual or a group voting collectively holds a majority of the voting interest). |
| Ø | Putnam will vote on a case-by-case basis on board-approved proposals to adopt supermajority voting provisions at controlled companies (companies in which an individual or a group voting collectively holds a majority of the voting interest). |
| Ø | Putnam will vote on a case-by-case basis on proposals to issue blank check preferred stock if appropriate “de-clawed” language is present. Specifically, appropriate de-clawed language will include cases where the Company states (i.e., through 8-K, proxy statement or other public disclosure) it will not use the preferred stock for anti-takeover purposes, or in order to implement a shareholder rights plan, or discloses a commitment to submit any future issuances of preferred stock to be used in a shareholder rights plan/anti-takeover purpose to a shareholder vote prior to its adoption. |
F. Other Business Matters
Putnam will vote for board-approved proposals approving routine business matters such as changing the company’s name and procedural matters relating to the shareholder meeting, except as follows:
| Ø | Putnam will vote on a case-by-case basis on proposals to amend a company’s charter or bylaws (except for charter amendments necessary or to effect stock splits, to change a company’s name, to authorize additional shares of common stock or other matters which are considered routine (for example, director age or term limits), technical in nature, fall within Putnam’s guidelines (for example, regarding board size or virtual meetings), are required pursuant to regulatory and/or listing rules, have little or no economic impact or will not negatively impact shareholder rights). |
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| Ø | Additionally, Putnam believes the bundling of items, whether the items are related or unrelated, is generally not in shareholders’ best interest. We may vote against the entire bundled proposal if we would normally vote against any of the items if presented individually. In these cases, we will review the bundled proposal on a case-by-case basis. |
| Ø | Putnam generally supports quorum requirements if the level is set high enough to ensure a broad range of shareholders is represented in person or by proxy but low enough so that the Company can transact necessary business. Putnam will vote on a case-by-case basis on proposals seeking to change quorum requirements; however, Putnam will normally support proposals that seek to comply with market or exchange requirements. |
| Ø | Putnam will vote on a case-by-case basis on proposals seeking to change a company’s state of incorporation. However, Putnam will vote for mergers and reorganizations involving business combinations designed solely to reincorporate a company in Delaware. |
| Ø | Putnam will vote against authorization to transact other unidentified, substantive business at the meeting. |
| Ø | Putnam will vote against proposals where there is a lack of information to make an informed voting decision. |
| Ø | Putnam will vote as follows on proposals to adjourn shareholder meetings: |
If Putnam is withholding support for the board of the company at the meeting, any proposal to adjourn should be referred for case-by-case analysis.
If Putnam is not withholding support for the board, Putnam will vote in favor of adjourning, unless the vote concerns an issue that is being referred back to Putnam for case-by-case review. Under such circumstances, the proposal to adjourn should also be referred to Putnam for case-by-case analysis.
| Ø | Putnam will vote against management proposals to adopt a specific state’s courts, or a specific U.S. district court as the exclusive forum for certain disputes, except that Putnam will vote for proposals adopting the State of Delaware, or the Delaware Chancery Court, as the exclusive forum, for corporate law matters for issuers incorporated in Delaware. Requiring shareholders to bring actions solely in one state may discourage the pursuit of derivative claims by increasing their difficulty and cost. However, Putnam’s guideline recognizes the expertise of the Delaware state court system in handling disputes involving Delaware corporations. In addition, Putnam will withhold votes from the chair of the Nominating/Governance committee if a company amends its Bylaws, or takes other actions, to adopt a specific state’s courts (other than Delaware courts, for issuers incorporated in Delaware) or a specific U.S. district court as the exclusive forum for certain disputes without shareholder approval. |
| Ø | Putnam will vote on a case-by-case basis on management proposals seeking to adopt a bylaw amendment allowing the company to shift legal fees and costs to unsuccessful plaintiffs in intra-corporate litigation (fee-shifting bylaw). Additionally, Putnam will vote against the Chair of the Nominating/Governance committee if a company adopts a fee-shifting bylaw amendment without shareholder approval. |
| Ø | Putnam will support management/shareholder proxy access proposals as long as the proposals align with the following principles for a shareholder (or up to 20 shareholders together as a group) to receive proxy access: |
| Ø | 1) The required minimum aggregate ownership of the Company’s outstanding common stock is no greater than 3%; |
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| Ø | 2) The required minimum holding period for the shareholder proponent(s) is no greater than two years; and |
| Ø | 3) The shareholder(s) are permitted to nominate at least 20% of director candidates for election to the board. |
Proposals requesting shares be held for 3 years will be reviewed on a case-by-case basis. Putnam will vote against proposals requesting shares be held for more than three years. Proposals that meet Putnam’s stated criteria and include other requirements relating to issues such as, but not limited to, shares on loan or compensation agreements with nominees, will be reviewed on a case-by-case basis.
Additionally, shareholder proposals seeking an amendment to a company’s proxy access policy which include any one of the supported criteria under Putnam’s guidelines, for example, a 2-year holding period for shareholders, will be reviewed on a case-by-case basis.
| Ø | Putnam supports management / shareholder proposals giving shareholders the right to call a special meeting as long as the ownership requirement in such proposals is at least 15% of the company’s outstanding common stock and not more than 25%. |
In general, Putnam will vote for management or shareholder proposals to reduce the ownership requirement below a company’s existing threshold, as long as the new threshold is at least 15% and not greater than 25% of the company’s outstanding common stock.
Putnam will vote against any proposal with an ownership requirement exceeding 25% of the company’s common stock or an ownership requirement that is less than 15% of the company’s outstanding common stock.
In cases where there are competing management and shareholder proposals giving shareholders the right to call a special meeting, Putnam will generally vote for the proposal which has the lower minimum shareholder ownership threshold, as long as that threshold is within Putnam’s recommended minimum/maximum thresholds. If only one of the competing proposals has a threshold that falls within Putnam’s threshold range, Putnam will normally support that proposal as long as it represents an improvement (reduction) from the previous requisite ownership level. Putnam will normally vote against both proposals if neither proposal has a requisite ownership level between 15% and 25% of the company’s outstanding common stock.
| Ø | Putnam will generally vote for management or shareholder proposals to allow a company to hold virtual-only or hybrid shareholder meetings or to amend its articles/charter/by-laws to allow for virtual-only or hybrid shareholder meetings, provided the proposal does not preclude in-person meetings (at any given time), and does not otherwise limit or impair shareholder participation; and if the company has provided clear disclosure to ensure that shareholders can effectively participate in virtual-only shareholder meetings and meaningfully communicate with company management and directors. Additionally, Putnam may consider the rationale of the proposal and whether there have been concerns about the company’s previous meeting practices. |
Disclosure should address the following:
| · | the ability of shareholders to ask questions during the meeting |
| o | including time guidelines for shareholder questions |
| o | rules around what types of questions are allowed |
| o | and rules for how questions and comments will be recognized and disclosed to meeting participants |
| o | the manner in which appropriate questions received during the meeting will be addressed by the board |
| · | procedures, if any, for posting appropriate questions received during the meeting and the company’s answers on the investor page of their website as soon as is practical after the meeting |
| · | technical and logistical issues related to accessing the virtual meeting platform; and |
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| · | procedures for accessing technical support to assist in the event of any difficulties accessing the virtual meeting |
| Ø | Putnam may vote against proposals that do not meet these criteria. |
Additionally, Putnam may vote against the Chair of the Governance Committee when the board is planning to hold a virtual-only shareholder meeting and the company has not provided sufficient disclosure (as noted above) or shareholder access to the meeting.
| Ø | Putnam will vote for proposals to approve a company’s board-approved climate transition action plan (“say on climate” proposals in which the company’s board proposes that shareholders indicate their support for the company’s plan), unless the proxy voting service has recommended a vote against the proposal, in which case Putnam will vote on a case-by-case basis on the proposal. |
| Ø | Putnam will vote on a case-by-case basis on board-approved proposals that conflict with shareholder proposals. |
II. Shareholder Proposals
Shareholder proposals are non-binding votes that are often opposed by management. Some proposals relate to matters that are financially immaterial to the company’s business, while others may be impracticable or costly for a company to implement. At the same time, well-crafted shareholder proposals may serve the purpose of raising issues that are material to a company’s business for management’s consideration and response. Putnam seeks to weigh the costs of different types of proposals against their expected financial benefits. More specifically:
Putnam will vote in accordance with the recommendation of the company’s board of directors on all shareholder proposals, except as follows:
| Ø | Putnam will vote for shareholder proposals that are consistent with Putnam’s proxy voting guidelines for board-approved proposals. |
| Ø | Putnam will vote for shareholder proposals to declassify a board, absent special circumstances which would indicate that shareholder interests are better served by a classified board structure. |
| Ø | Putnam will vote for shareholder proposals to require shareholder approval of shareholder rights plans. |
| Ø | Putnam will vote for shareholder proposals asking that director nominees receive support from holders of a majority of votes cast or a majority of shares outstanding of the company in order to be (re) elected. |
| Ø | Putnam will review on a case-by-case basis, shareholder proposals requesting that the board adopt a policy whereby, in the event of a significant restatement of financial results or significant extraordinary write-off, the board will recoup, to the fullest extent practicable, for the benefit of the company, all performance-based bonuses or awards that were made to senior executives based on having met or exceeded specific performance targets to the extent that the specified performance targets were not met. |
| | Ø | Putnam will vote for shareholder proposals urging the board to seek shareholder approval of any future supplemental executive retirement plan (“SERP”), or individual retirement arrangement, for senior executives that provides credit for additional years of service not actually worked, preferential benefit formulas not provided under the company’s tax-qualified retirement plans, accelerated vesting of retirement benefits or retirement perquisites and fringe benefits that are not generally offered to other company employees. (Implementation of this policy shall not breach any existing employment agreement or vested benefit.) |
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| Ø | Putnam will vote for shareholder proposals requiring companies to report on their executive retirement benefits. (Deferred compensation, split-dollar life insurance, SERPs and pension benefits) |
| Ø | Putnam will vote for shareholder proposals requesting that a company establish a pay-for-superior-performance standard whereby the company discloses defined financial and/or stock price performance criteria (along with the detailed list of comparative peer group) to allow shareholders to sufficiently determine the pay and performance correlation established in the company’s performance-based equity program. In addition, no multi-year award should be paid out unless the company’s performance exceeds, during the current CEO’s tenure (three or more years), its peer median or mean performance on selected financial and stock price performance criteria. |
| Ø | Putnam will vote for shareholder proposals urging the board to disclose in a separate report to shareholders, the Company’s relationships with its executive compensation consultants or firms. Specifically, the report should identify the entity that retained each consultant (the company, the board or the compensation committee) and the types of services provided by the consultant in the past five years (non-compensation-related services to the company or to senior management and a list of all public company clients where the Company’s executives serve as a director.) |
| Ø | Putnam will vote for shareholder proposals requiring companies to accelerate vesting of equity awards under management severance agreements only if both of the following conditions are met: |
| · | the company undergoes a change in control, and |
| · | the change in control results in the termination of employment for the person receiving the severance payment. |
| Ø | Putnam will vote for shareholder proposals requiring that the chair’s position be filled by an independent director (separate chair/CEO). However, Putnam will vote on a case-by-case basis on such proposals when the company’s board has a lead-independent director (or already has an independent or separate chair) and Putnam is supporting the nominees for the board of directors. |
| Ø | Putnam will vote for shareholder proposals seeking the submission of golden coffins to a shareholder vote or the elimination of the practice altogether. |
| Ø | Putnam will vote for shareholder proposals seeking a policy that forbids any director who receives more than 25% withhold votes cast (based on for and withhold votes) from serving on any key board committee for two years and asking the board to find replacement directors for the committees if need be. |
| Ø | Putnam will vote for shareholder proposals urging the board to seek shareholder approval of severance agreements (e.g., golden and tin parachutes). |
| · | However, Putnam will vote against such proposals when the company has a policy that minimally requires shareholder approval of severance agreements for executives that provides for cash severance benefits exceeding 2.99 times the sum of the executive’s base salary plus target annual non-equity incentive plan bonus opportunity. |
Putnam will vote on a case-by-case basis on approving such compensation arrangements.
| Ø | Putnam will vote for shareholder proposals requiring companies to make cash payments under management severance agreements only if both of the following conditions are met: the company undergoes a change in control, and the change in control results in the termination of employment for the person receiving the severance payment. |
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| Ø | Putnam will vote on a case-by-case basis on shareholder proposals to limit a company’s ability to make excise tax gross-up payments under management severance agreements as well as proposals to limit income or other tax gross-up payments. |
| Ø | Putnam will vote in accordance with the recommendation of the company’s board of directors on shareholder proposals regarding corporate political spending, unless Putnam is voting against the directors, in which case the proposal would be reviewed on a case-by-case basis. |
| Ø | Putnam will vote on a case-by-case basis on shareholder proposals that conflict with board-approved proposals. |
Environmental and Social
| Ø | Putnam believes that sustainable environmental practices and sustainable social policies are important components of long-term value creation. Companies should evaluate the potential risks to their business operations that are directly related to environmental and social factors (among others). In evaluating shareholder proposals relating to environmental and social initiatives, Putnam takes into account (1) the relevance and materiality of the proposal to the company’s business, (2) whether the proposal is well crafted (e.g., whether it references science-based targets, or standard global protocols), and (3) the practicality or reasonableness of implementing the proposal. |
Putnam may support well-crafted and well-targeted proposals that request additional reporting or disclosure on a company’s plans to mitigate risk to the company related to the following issues and/or their strategies related to these issues: Environmental issues, including but not limited to, climate change, greenhouse gas emissions, renewable energy, and broader sustainability issues; and Social issues, including but not limited to, fair pay, employee diversity and development, safety, labor rights, supply chain management, privacy and data security.
In addition, Putnam will consider proposals related to Artificial Intelligence (“AI”) on a case-by-case basis.
Putnam will consider factors such as (i) the industry in which the company operates, (ii) the company’s current level of disclosure, (iii) the company’s level of oversight, (iv) the company’s management of risk arising out of these matters, (v) whether the company has suffered a material financial impact. Other factors may also be considered.
Putnam will consider the recommendation of its third-party proxy service provider and may consider other factors such as third-party evaluations of ESG performance.
Additionally, Putnam may vote on a case-by-case basis on proposals which ask a company to take action beyond reporting where our third-party proxy service provider has identified one or more reasons to warrant a vote FOR.
III. Voting Shares of Non-US Issuers
Many non-US jurisdictions impose material burdens on voting proxies. There are three primary types of limits as follows:
| (1) | Share blocking. Shares must be frozen for certain periods of time to vote via proxy. |
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| (2) | Share re-registration. Shares must be re-registered out of the name of the local custodian or nominee into the name of the client for the meeting and, in many cases, then re-registered back. Shares are normally blocked in this period. |
| (3) | Powers of Attorney. Detailed documentation from a client must be given to the local sub-custodian. In many cases Putnam is not authorized to deliver this information or sign the relevant documents. |
Putnam’s policy is to weigh the benefits to clients from voting in these jurisdictions against the detriments of not doing so. For example, in a share blocking jurisdiction, it will normally not be in a client’s interest to freeze shares simply to participate in a non- contested routine meeting. More specifically, Putnam will normally not vote shares in non-US jurisdictions imposing burdensome proxy voting requirements except in significant votes (such as contested elections and major corporate transactions) where directed by portfolio managers.
Putnam recognizes that the laws governing non-US issuers will vary significantly from US law and from jurisdiction to jurisdiction. Accordingly, it may not be possible or even advisable to apply these guidelines mechanically to non-US issuers. However, Putnam believes that shareholders of all companies are protected by the existence of a sound corporate governance and disclosure framework. Accordingly, Putnam will vote proxies of non-US issuers in accordance with the foregoing guidelines where applicable, except as follows:
| Ø | Putnam will vote for shareholder proposals calling for a majority of the directors to be independent of management. |
| Ø | Putnam will vote for shareholder proposals that implement corporate governance standards similar to those established under U.S. federal law and the listing requirements of U.S. stock exchanges, and that do not otherwise violate the laws of the jurisdiction under which the company is incorporated. |
| Ø | Putnam will vote on a case-by-case basis on proposals relating to (1) the issuance of common stock in excess of 20% of a company’s outstanding common stock where shareholders do not have preemptive rights, or (2) the issuance of common stock in excess of 100% of a company’s outstanding common stock where shareholders have preemptive rights. |
| Ø | Putnam will vote for proposals to authorize share repurchase programs that are recommended for approval by Putnam’s proxy voting service provider, otherwise Putnam will vote against such proposals; except that Putnam will vote on a case-by-case basis if there are concerns that there may be abusive practices related to the share repurchase programs. |
| Ø | Putnam will vote against authorizations to repurchase shares or issue shares or convertible debt instruments with or without preemptive rights when such authorization can be used as a takeover defense without shareholder approval. Putnam will not apply this policy to a company with a shareholder who controls more than 50% of its voting rights. |
| Ø | Putnam will generally vote for proposals that include debt issuances, however substantive/non-routine proposals, and proposals that fall outside of normal market practice or reasonable standards, will be reviewed on a case-by-case basis. |
| Ø | Putnam will vote for board-approved routine, market-practice proposals. These proposals are limited to (1) those issues that will have little or no economic impact, such as technical, editorial, or mandatory regulatory compliance items, (2) those issues that will not adversely affect and/or which clearly improve shareholder rights/values, and which do not violate Putnam’s proxy voting guidelines, or (3) those issues that do not seek to deviate from existing laws or regulations. Examples include but are not limited to, related party transactions (non-strategic), profit-and-loss transfer agreements (Germany), authority to increase paid-in capital (Taiwan). Should any unusual circumstances be identified concerning a normally routine issue, such proposals will be referred back to Putnam for internal review. |
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| Ø | Putnam will generally vote for proposals regarding amendments seeking to expand business lines or to amend the corporate purpose, provided the proposal would not include a significant or material departure from the company’s current business, and/or will provide the company with greater flexibility in the performance of its activities. |
| Ø | Putnam will normally vote for management proposals concerning allocation of income and the distribution of dividends. However, Putnam portfolio teams will override this guideline when they conclude that the proposals are outside the market norms (i.e., those seen as consistently and unusually small or large compared to market practices). |
| Ø | Putnam will generally vote for proposals seeking to adjust the par value of common stock. However, non-routine, substantive proposals will be reviewed on a case-by-case basis. |
| Ø | Putnam will vote against proposals that would authorize the company to reduce the notice period for calling special or extraordinary general meetings to less than 21-Days. |
| Ø | Putnam will generally vote for proposals relating to transfer of reserves/increase of reserves (i.e., France, Japan). However, Putnam will vote on a case-by-case basis if the proposal falls outside of normal market practice. |
| Ø | Putnam will generally vote for proposals to increase the maximum variable pay ratio. However, Putnam will vote on a case-by-case basis if we are voting against a company’s remuneration report or if the proposal seeks an increase in excess of 200%. |
| Ø | Putnam will review stock option plans on a case-by-case basis which allow for the options exercise price to be reduced by dividend payments (if the plan would normally pass Putnam’s Guidelines). |
| Ø | Putnam will generally vote for requests to provide loan guarantees however, Putnam will vote on a case-by-case basis if the total amount of guarantees is in excess of 100% of the company’s audited net assets. |
| Ø | Putnam will generally support remuneration report/policy proposals (i.e., advisory/binding) where a company’s executive compensation is linked directly with the performance of the business and executive. Putnam will generally support compensation proposals which incorporate a mix of reasonable salary and performance based short- and long-term incentives. Companies should demonstrate that their remuneration policies are designed and managed to incentivize and retain executives while growing the company’s long-term shareholder value. |
Generally, Putnam will vote against remuneration report/policy proposals (i.e., advisory/binding) in the following cases:
| o | Disconnect between pay and performance |
| o | No performance metrics disclosed; |
| o | No relative performance metrics utilized; |
| o | Single performance metric was used and it was an absolute measure; |
| o | Performance goals were lowered when management failed or was unlikely to meet original goals; |
| o | Long Term Incentive Plan is subject to retesting (e.g., Australia); |
| o | Service contracts longer than 12 months (e.g., United Kingdom); |
| o | Allows vesting below median for relative performance metrics; |
| o | Ex-gratia / non-contractual payments have been made (e.g., United Kingdom and Australia); |
| o | Contains provisions to automatically vest upon change-of-control; or |
| o | Other poor compensation practices or structures. |
| o | Pension provisions for new executives is not at the same level as the majority of the wider workforce; pension provisions for incumbent executives are not set to decrease over time (United Kingdom) |
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| o | Proposed CEO salary increases are not justifiably appropriate in comparison to wider workforce or rationale for exception increases is not fully disclosed (United Kingdom) |
| Ø | Putnam will vote on a case-by-case basis on bonus payments to executive directors or senior management; however, Putnam will vote against payments that include outsiders or independent statutory auditors. |
| Ø | Matters Relating to Board of Directors |
| Ø | Uncontested Board Elections |
| Ø | Asia: China, Hong Kong, India, Indonesia, Philippines, Taiwan and Thailand |
| Ø | Putnam will vote against the entire board of directors if |
| · | fewer than one-third of the directors are independent directors, or |
| · | the board has not established audit, compensation and nominating committees each composed of a majority of independent directors, or |
| · | the chair of the audit, compensation or nominating committee is not an independent director. |
Ø Commentary: Companies listed in China (or dual-listed in China and Hong Kong) often have a separate supervisory committee in addition to a standard board of directors containing audit, compensation, and nominating committees. The supervisory committee provides oversight of the financial affairs of the company and supervises members of the board and management, while the board of directors makes decisions related to the company’s business and investment strategies. The supervisory committee normally comprises employee representatives and shareholder representatives. Shareholder representatives are elected by shareholders of the company while employee representatives are elected by the company’s staff. Shareholder representatives may be independent or may be affiliated with the company or its substantial shareholders. Current laws and regulations neither provide a basis for evaluation of supervisor independence nor do they require a supervisor to be independent.
| Ø | Putnam will generally vote in favor of nominees to the Supervisory Committee |
Australia
| Ø | Putnam will vote against the entire board of directors if |
| fewer than a majority of the directors are independent, or |
| · | the board has not established an audit committee composed solely of non-executive directors, a majority of whom, including the chair of the committee (who should not be the board chair), should be independent directors, or |
| · | the board has not established nominating and compensation committees each composed of a majority of independent, non-executive directors, with an independent chair. |
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Brazil
| Ø | Putnam will vote against proposals requesting cumulative voting unless there are more candidates than number of seats available, in which case vote for. |
| Ø | Putnam will vote for proposals for the proportional allocation of cumulative votes if Putnam is supporting the entire slate of nominees. Putnam will vote against such proposals if Putnam is not supporting the entire slate. |
| Ø | Putnam will abstain on individual director allocation proposals if Putnam is voting for the proportional allocation of cumulative votes. Putnam will vote on a case-by-case basis on individual director allocation proposals if Putnam is voting against the proportional allocation of votes. |
| Ø | Putnam will vote for proposals to cumulate votes of common and preferred shareholders if the nominees are known and Putnam is supporting the applicable nominees; Putnam will vote against such proposals if Putnam is not supporting the known nominees, or if the nominees are unknown. |
| Ø | Putnam will generally vote against proposals seeking the recasting of votes for amended slate (as new candidates could be included in the amended slate without prior disclosure to shareholders). |
| Ø | Putnam will vote against proposals regarding instructions if meeting is held on second call if election of directors is part of the recasting as the slate can be amended without (prior) disclosure to shareholders. |
| Ø | Putnam will vote against proposals regarding the casting of minority votes to the candidate with largest number of votes. |
Canada
Canadian corporate governance requirements mirror corporate governance reforms that have been adopted by the NYSE and other U.S. national securities exchanges and stock markets. As a result, Putnam will vote on matters relating to the board of directors of Canadian issuers in accordance with the guidelines applicable to U.S. issuers.
Commentary: Like the UK’s Combined Code on Corporate Governance, the policies on corporate governance issued by Canadian securities regulators embody the “comply and explain” approach to corporate governance. Because Putnam believes that the board independence standards contained in the proxy voting guidelines are integral to the protection of investors in Canadian companies, these standards will be applied in a prescriptive manner.
Continental Europe (ex-Germany)
| Ø | Putnam will vote against the entire board of directors if |
| · | fewer than a majority of the directors are independent directors, or |
| · | the board has not established audit, nominating and compensation committees each composed of a majority of independent directors. |
| Ø | Commentary: An “independent director” under the European Commission’s guidelines is one who is free of any business, family or other relationship, with the company, its controlling shareholder or the management of either, that creates a conflict of interest such as to impair his judgment. A “non-executive director” is one who is not engaged in the daily management of the company. |
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In France, Employee Representatives are employed by the company and represent rank and file employees. These representatives are elected by company employees. The law also provides for the appointment of employee shareholder representatives, if the employee shareholdings exceed 3% of the share capital. Employee shareholder representatives are elected by the company’s shareholders (via general meeting).
Germany
| Ø | For companies subject to “co-determination,” Putnam will vote for the election of nominees to the supervisory board, except: |
| Ø | Putnam will vote against the Supervisory Board if |
| o | the board has not established an audit committee comprising an Independent chair. |
| o | the audit committee chair serves as board chair. |
| o | the board contains more than two former management board members. |
| Ø | Putnam will vote against the election of a former member of the company’s managerial board to chair of the supervisory board. |
Ø Commentary: German corporate governance is characterized by a two-tier board system - a managerial board composed of the company’s executive officers, and a supervisory board. The supervisory board appoints the members of the managerial board. Shareholders elect members of the supervisory board, except that in the case of companies with a large number of employees, company employees are allowed to elect some of the supervisory board members (one-half of supervisory board members are elected by company employees at companies with more than 2,000 employees; one-third of the supervisory board members are elected by company employees at companies with more than 500 employees but fewer than 2,000). This practice is known as co-determination.
Israel
Non-Controlled Banks: Director elections at Non-Controlled banks are overseen by the Supervisor of the Banks and nominees for election as “other” (non-external) directors and external directors (under Companies Law and Directive 301) are put forward by an external and independent committee. As such,
| Ø | Putnam’s guidelines regarding board Nominating Committees will not apply |
| Ø | Putnam will vote on a case-by-case on nominees when there are more nominees than seats available. |
Italy
Election of directors and statutory auditors:
| Ø | Putnam will apply the director guidelines to the majority shareholder supported list and vote accordingly (for or against) if multiple lists of director candidates are presented. If there is no majority shareholder supported slate of nominees, Putnam will support the shareholder slate of nominees that is recommended for approval by Putnam’s service provider. |
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| Ø | Putnam will vote against the entire list of director nominees if the list is bundled as one proposal and if Putnam would otherwise be voting against any one director nominee. |
| Ø | Putnam will generally vote for the majority shareholder supported list of statutory auditor nominees. |
Note: Pursuant to Italian law, directors and statutory auditors are elected through a slate voting system whereby candidates are presented in lists submitted by shareholders representing a minimum percentage of share capital.
| Ø | Putnam will withhold votes from any director not identified in the proxy materials. (Example: Co-opted director nominees.) |
Japan
| Ø | For companies that have established a U.S.-style corporate governance structure, Putnam will withhold votes from the entire board of directors if: |
| · | the board does not have a majority of outside directors, |
| · | the board has not established nominating and compensation committees composed of a majority of outside directors, |
| · | the board has not established an audit committee composed of a majority of independent directors, or |
| · | the board does not have at least two independent directors for companies with a controlling shareholder. |
| Ø | For companies that have established a statutory auditor board structure: |
| · | Putnam will withhold votes from the appointment of members of a company’s board of statutory auditors if a majority of the members of the board of statutory auditors is not independent. |
| Ø | For companies that have established a statutory auditor board structure, Putnam will withhold votes from the entire board of directors if: |
| · | the board does not have at least two outside directors, or |
| · | the board does not have at least two independent directors for companies with a controlling shareholder. |
| · | Putnam will vote against any statutory auditor nominee who attends fewer than 75% of board and committee meeting without valid reasons for the absences (i.e., illness, personal emergency, etc.) (Note that Corporate Law requires disclosure of outsiders’ attendance but not that of insiders, who are presumed to have no more important time commitments.) |
| Ø | For companies that have established an audit committee board structure (one-tier / one committee), Putnam will withhold votes from the entire board of directors if: |
| · | the board does not have at least two outside directors, |
| · | the board does not have at least two independent directors for companies with a controlling shareholder, or |
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| · | the board has not established an audit committee composed of a majority of independent directors |
Election of Executive Director and Election of Supervisory Director - REIT
REITs have a unique two-tier board structure with generally one or more executive directors and two or more supervisory directors. The number of supervisory directors must be greater than, not equal to, the number of executive directors. Shareholders are asked to vote on both types of directors. Putnam will vote as follows, provided each board of executive / supervisory directors meets legal requirements.
| Ø | Putnam will generally vote for the election of Executive Director |
| Ø | Putnam will generally vote for the election of Supervisory Directors |
Commentary:
Definition of outside director and independent director:
The Japanese Companies Act focuses on two director classifications: Insider or Outsider. An outside director is a director who is not a director, executive, executive director, or employee of the company or its parent company, subsidiaries or affiliates. Further, a director, executive, executive director or employee, who have executive responsibilities, of the company or subsidiaries can regain eligibility ten years after his or her resignation, provided certain other requirements are met. An outside director is designated as an “independent” director based on the Tokyo Stock Exchange listing rules. An outside director is “independent” if that person can make decisions completely independent from the managers of the company, its parent, subsidiaries, or affiliates and does not have a material relationship with the company (i.e., major client, trading partner, or other business relationship; familial relationship with current director or executive; etc.).
The guidelines have incorporated these definitions in applying the board independence standards above.
Korea
Putnam will withhold votes from the entire board of directors if:
| · | For large companies (i.e., those with assets of at least KRW 2 trillion); the board does not have at least three independent directors or less than a majority of directors are independent directors, |
| · | For small companies (i.e., those with assets of less than KRW 2 trillion), fewer than one-fourth of the directors are independent directors, |
| · | The board has not established a nominating committee with at least half of the members being outside directors, or |
| · | the board has not established an audit committee composed of at least three members and in which at least two-thirds of its members are independent directors. |
Commentary: For purposes of these guidelines, an “outside director” is a director who is independent from the management or controlling shareholders of the company and holds no interests that might impair performing his or her duties impartially from the company, management or controlling shareholder. In determining whether a director is an outside director, Putnam will also apply the standards included in Article 382 of the Korean Commercial Act, i.e., no employment relationship with the company for a period of two years before serving on the committee, no director or employment relationship with the company’s largest shareholder, etc.) and may consider other business relationships that would affect the independence of an outside director.
| Ø | Putnam will generally vote for proposals to amend the Executive Officer Retirement Allowance Policy unless the recipients of the grants include non-executives; the proposal would have a negative impact on shareholders, or the proposal appear to be outside of normal market practice, in which case Putnam will vote against. |
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Malaysia
| Ø | Putnam will vote against the entire board of directors if: |
| · | less than 50% of the directors are independent directors, or less than a majority of the directors are independent directors for large companies, |
| · | the board has not established an audit committee with all members being independent directors, including the committee chair, |
| · | the board has not established a nominating committee with all members being non-executive directors, a majority of whom are independent, including the committee chair; the board chair should not serve as a member of the nomination committee, or |
| · | the board has not established a compensation committee with all members being non-executive directors, a majority of whom are independent; the board chair should not serve as a member of the remuneration committee. |
Nordic Markets – Finland, Norway, Sweden
| Ø | Putnam will vote against the entire board of directors if: |
Board Independence:
| · | The board does not have a majority of directors independent from the company and management. (Sweden, Finland, Norway) |
| · | The board does not have at least two directors independent from the company and its major shareholders holding > 10% of the Company’s share capital. (Sweden, Finland, Norway) |
| · | An executive director is a member of the board. (Norway) |
Audit Committee:
| · | The audit committee does not consist of a majority of directors independent from the company and management. (Sweden, Finland) |
| · | The audit committee does not have at least one director independent from the company and its major shareholders holding > 10% of the Company’s share capital. (Sweden, Finland) |
| · | The audit committee is not majority independent. (Norway) |
Remuneration Committee:
| · | The remuneration committee is not fully independent of the company, excluding the chair. (Sweden) |
| · | The remuneration committee is not majority independent of the company. (Finland) |
| · | The remuneration committee does not consist fully of non-executive directors. (Finland) |
| · | The remuneration committee is not fully independent of management (Norway) |
| · | The remuneration committee is not majority independent from the company and its major shareholders holding > 50% of the Company’s share capital. (Sweden, Finland, Norway) |
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Board Nomination Committee:
| · | The nomination committee does not consist of a majority of directors independent from the company. (Finland) |
| · | An executive is a member of the nomination committee. (Finland) |
External Nomination Committee: Vote against the establishment of the nomination committee and its guidelines when:
| · | The external committee is not majority independent of the company and management. (Sweden) |
| · | The external committee does not have at least one director not affiliated to largest shareholder on the committee. (Sweden) |
| · | The external committee does not meet best practice based on ISS analysis. (Finland) |
| · | The external committee is not majority independent of the board and management. (Norway) |
| · | The external committee has more than one member of the board of the directors sitting on the committee. (Norway) |
| · | There is insufficient disclosure provided for new nominees (Norway) |
| · | An executive is a member of the committee. (Norway) |
Russia
Ø Putnam will vote on a case-by-case basis for the election of nominees to the board of directors.
Ø Commentary: In Russia, director elections are handled through a cumulative voting process. Cumulative voting allows shareholders to cast all of their votes for a single nominee for the board of directors, or to allocate their votes among nominees in any other way. In contrast, in “regular” voting, shareholders may not give more than one vote per share to any single nominee. Cumulative voting can help to strengthen the ability of minority shareholders to elect a director.
Singapore
Ø Putnam will vote against from the entire board of directors if
| · | in the case of a board with an independent director serving as chair, fewer than one-third of the directors are independent directors; or, in the case of a board not chaired by an independent director, fewer than half of the directors are independent directors, |
| · | the board has not established audit and compensation committees, each with an independent director serving as chair, with at least a majority of the members being independent directors, and with all of the directors being non-executive directors, or |
| · | the board has not established a nominating committee, with an independent director serving as chair, and with at least a majority of the members being independent directors. |
United Kingdom, Ireland
Commentary:
Application of guidelines: Although the Combined Code has adopted the “comply and explain” approach to corporate governance, Putnam believes that the guidelines discussed above with respect to board independence standards are integral to the protection of investors in UK companies. As a result, these guidelines will be applied in a prescriptive manner.
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Definition of independence: For the purposes of these guidelines, a non-executive director shall be considered independent if the director meets the independence standards in section A.3.1 of the Combined Code (i.e., no material business or employment relationships with the company, no remuneration from the company for non-board services, no close family ties with senior employees or directors of the company, etc.), except that Putnam does not view service on the board for more than nine years as affecting a director’s independence.
Smaller companies: A smaller company is one that is below the FTSE 350 throughout the year immediately prior to the reporting year.
| Ø | Putnam will withhold votes from the entire board of directors if: |
| · | the board, excluding the Non-Executive Chair, is not comprised of at least half independent non-executive directors, |
| · | the board has not established a Nomination committee composed of a majority of independent non-executive directors, excluding the Non-Executive Chair, or |
| · | the board has not established a Compensation committee composed of (1) at least three directors (in the case of smaller companies, as defined by the Combined Code, two directors) and (2) solely of independent non-executive directors. The company chair may be a member of, but not chair, the Committee provided he or she was considered independent on appointment as chair, or |
| · | The board has not established an Audit Committee composed of, (1) at least three directors (in the case of smaller companies as defined by the Combined Code, two directors) and (2) solely of independent non-executive directors. The board chair may not serve on the audit committee of large or small companies. |
| Ø | All other jurisdictions |
| Ø | In the absence of jurisdiction specific guidelines, Putnam will vote as follows for boards/supervisory boards: |
| o | Putnam will vote against the entire board of directors if |
| · | fewer than a majority of the directors are independent directors, or |
| · | the board has not established audit, nominating and compensation committees each composed of a majority of independent directors. |
Ø Additional Commentary regarding all Non-US jurisdictions:
Ø Whether a director is considered “independent” or not will be determined by reference to local corporate law or listing standards.
Ø Some jurisdictions may legally require or allow companies to have a certain number of employee representatives, employee shareholder representatives (e.g., France) and/or shareholder representatives on their board. Putnam generally does not consider these representatives independent. The presence of employee representatives or employee shareholder representatives on the board and key committees is generally legally mandated. In most markets, shareholders do not have the ability to vote on the election of employee representatives or employee shareholder representatives. In some markets, significant shareholders have a legal right to nominate shareholder representatives. Shareholders are required to approve the election of shareholder representatives to the board. Unlike employee representatives, there are no legal requirements regarding the presence of shareholder representatives on the board or its committees.
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| Ø | Putnam will not include employee or employee shareholder representatives in the independence calculation of the board or key committees, nor in the calculation of the size of the board. |
| Ø | Putnam will include shareholder representatives in the independence calculation of the board and key committees, and in the calculation of the size of the board. |
| Ø | Putnam will generally support shareholder or employee representatives if included in the agenda Putnam will vote on a case-by-case basis when there are more candidates than seats. Additionally, Putnam will vote against such nominees when there is insufficient information disclosed. |
| Ø | Putnam Investments’ policies regarding the provision of professional services and transactional relationship with regard to directors will apply. |
| Ø | Putnam will vote for independent nominees for alternate director, unless such nominees do not meet Putnam’s individual director standards. |
Shareholder nominated directors/self-nominated directors
| Ø | Putnam will vote against shareholder nominees if Putnam supports the board of directors. |
| Ø | Putnam will vote on a case-by case basis if Putnam will be voting against the current board. |
| Ø | Putnam will vote on a case-by-case basis if the proposal regarding a self-nominated/shareholder nominated director nominee would add an additional seat to the board if the nominee is approved. |
Other Business Matters
Japan
A. Article Amendments
| Ø | The Japanese Companies Act gives companies the option to adopt a U.S.-Style corporate structure (i.e., a board of directors and audit, nominating, and compensation committees). Putnam will vote for proposals to amend a company’s articles of incorporation to adopt the U.S.-Style “Board with Committees” structure. However, the independence of the outside directors is critical to effective corporate governance under this new system. Putnam will, therefore, scrutinize the backgrounds of the outside director nominees at such companies, and will vote against the amendment where Putnam believes the board lacks the necessary level of independence from the company or a substantial shareholder. |
| Ø | Putnam will vote on a case-by-case basis on granting the board the authority to repurchase shares at its discretion. |
| Ø | Putnam will vote against amendments to delete a requirement directing the company to reduce authorized capital by the number of treasury shares cancelled. If issued share capital decreases while authorized capital remains unchanged, then the company will have greater leeway to issue new shares (for example as a private placement or a takeover defense). |
| Ø | Putnam will vote against proposals to authorize appointment of special directors. Under the new Corporate Law, companies are allowed to appoint, from among their directors, “special directors” who will be authorized to make decisions regarding the purchase or sale of important assets and major borrowing or lending, on condition that the board has at least six directors, including at least one non-executive director. At least three special directors must participate in the decision-making process and |
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decisions shall be made by a majority vote of the special directors. However, the law does not require any of the special directors to be non-executives, so in effect companies may use this mechanism to bypass outsiders.
| Ø | Putnam will generally vote for proposals to create new class of shares or to conduct a share consolidation of outstanding shares to squeeze out minority shareholders. |
| Ø | Putnam will vote against proposals seeking to enable companies to establish specific rules governing the exercise of shareholder rights. (Note: Such as, shareholders’ right to submit shareholder proposals or call special meetings.) |
B. Compensation Related Matters
| Ø | Putnam will vote against option plans which allow the grant of options to suppliers, customers, and other outsiders. |
| Ø | Putnam will vote against stock option grants to independent internal statutory auditors. The granting of stock options to internal auditors, at the discretion of the directors, can compromise the independence of the auditors and provide incentives to ignore accounting problems, which could affect the stock price over the long term. |
| Ø | Putnam will vote against the payment of retirement bonuses to directors and statutory auditors when one or more of the individuals to whom the grants are being proposed has not served in an executive capacity for the company. Putnam will also vote against payment of retirement bonuses to any directors or statutory auditors who have been designated by the company as independent. Retirement bonus proposals are all-or-nothing, meaning that split votes against individual payments cannot be made. If any one individual does not meet Putnam’s criteria, Putnam will vote against the entire bundled item. |
C. Other Business Matters
| Ø | Putnam votes for mergers by absorptions of wholly-owned subsidiaries by their parent companies. These deals do not require the issuance of shares, and do not result in any dilution or new obligations for shareholders of the parent company. These transactions are routine. |
| Ø | Putnam will vote for the acquisition if it is between parent and wholly-owned subsidiary. |
| Ø | Putnam will vote for the formation of a holding company, if routine. Holding companies are once again legal in Japan and a number of companies, large and small, have sought approval to adopt a holding company structure. Most of the proposals are intended to help clarify operational authority for the different business areas in which the company is engaged and promote effective allocation of corporate resources. As most of the reorganization proposals do not entail any share issuances or any change in shareholders’ ultimate ownership interest in the operating units, Putnam will treat most such proposals as routine. |
| Ø | Putnam will vote against proposals that authorize the board to vary the AGM record date. |
| Ø | Putnam will vote for proposals to abolish the retirement bonus system |
| Ø | Putnam will vote for board-approved director/officer indemnification proposals |
| Ø | Putnam will vote on a case-by-case basis on private placements (Third-party share issuances). Where Putnam views the share issuance necessary to avoid bankruptcy or to put the company back on solid financial footing, Putnam will generally vote for. When a private placement allows a particular shareholder to obtain a controlling stake in the company at a discount to market prices, or where the private placement otherwise disadvantages ordinary shareholders, Putnam will vote against. |
| |
| Ø | Putnam will generally vote against shareholder rights plans (poison pills). However, if all of the following criteria are met, Putnam will evaluate such poison pills on a case-by-case basis: |
1) The poison pill must have a duration of no more than three years.
2) The trigger threshold must be no less than 20 percent of issued capital.
3) The company must have no other types of takeover defenses in place.
4) The company must establish a committee to evaluate any takeover offers, and the members of that committee must all meet Putnam’s’ definition of independence.
5) At least 20 percent, and no fewer than two, of the directors must meet Putnam’s definition of independence. These independent directors must also meet Putnam’s guidelines on board meeting attendance.
6) The directors must stand for reelection on an annual basis.
7) The company must release its proxy materials no less than three weeks before the meeting date.
| Ø | Putnam will vote against proposals to allow the board to decide on income allocation without shareholder vote. |
| Ø | Putnam will vote against proposals to limit the liability of External Audit Firms (“Accounting Auditors”) |
| Ø | Putnam will vote against proposals seeking a reduction in board size that eliminates all vacant seats. |
| Ø | Putnam may generally vote against proposals seeking an increase in authorized capital that leaves the company with as little as 25 percent of the authorized capital outstanding (general request). However, such proposals will be evaluated on a company specific basis, taking into consideration such factors as current authorization outstanding, existence (or lack thereof) of preemptive rights and rationale for the increase. |
| Ø | Putnam will vote for corporate split agreement and transfer of sales operations to newly created wholly-owned subsidiaries where the transaction is a purely internal one which does not affect shareholders’ ownership interests in the various operations. All other proposals will be referred back to Putnam for case-by-case review. These reorganizations usually accompany the switch to a holding company structure, but may be used in other contexts. |
United Kingdom
| Ø | Putnam will not apply the U.S. standard 15% discount cap for employee share purchase schemes at U.K. companies. As such, Putnam will generally vote for ‘Save-As-You-Earn’ schemes in the U.K which allow for no more than a 20% purchase discount, and which otherwise comply with U.K. law and Putnam standards. |
France
| Ø | Putnam will not apply the U.S. standard 15% discount cap for employee share purchase schemes at French companies. As such, Putnam will generally vote for employee share purchase schemes in France that allow for no greater than a 30% purchase discount, or 40% purchase discount if the vesting period is equal to or greater than ten years, and which otherwise comply with French law and Putnam standards. |
| Ø |
Putnam will generally vote for the Remuneration Report (established based on SRD II), however Putnam will vote on a case-by-case basis when Putnam is voting against both the ex-Post Remuneration Report (CEO) and ex-Ante Remuneration Policy (CEO, or proposal including CEO remuneration package) in the current year, and Putnam’s third party service provider(s) is recommending a vote against. |
| |
Canada
| Ø | Putnam will generally vote for Advance Notice provisions for submitting director nominations not less than 30 days prior to the date of the annual meeting. For Advance Notice provisions where the minimum number of days to submit a shareholder nominee is less than 30 days prior to the meeting date, Putnam will vote on a case-by-case basis. Putnam will also vote on a case-by-case basis if the company’s policy expressly prohibits the commencement of a new notice period in the event the originally scheduled meeting is adjourned or postponed. |
Hong Kong
| Ø | Putnam will vote for proposals to approve a general mandate permitting the company to engage in non-pro rata share issuances of up to 20% of total equity in a year if the company’s board meets Putnam’s independence standards; if the company’s board does not meet Putnam’s independence standards, then Putnam will vote against these proposals. |
Additionally, Putnam will vote for proposals to approve the reissuance of shares acquired by the company under a share repurchase program, provided that: (1) Putnam supported (or would have supported, in accordance with these guidelines) the share repurchase program, (2) the reissued shares represent no more than 10% of the company’s outstanding shares (measured immediately before the reissuance), and (3) the reissued shares are sold for no less than 85% of current market value.
This policy supplements policies regarding share issuances as stated above under section
III. Voting Shares of Non-US Issuers.
Taiwan
| Ø | Putnam will vote against proposals to release the board of directors from the non-compete restrictions specified in Taiwanese Company Law. However, Putnam will vote for such proposals if the directors are engaged in activities with a wholly- owned subsidiary of the company. |
Australia
| Ø | Putnam will vote for proposals to carve out, from the general cap on non-pro rata share issues of 15% of total equity in a rolling 12-month period, a particular proposed issue of shares or a particular issue of shares made previously within the 12-month period, if the company’s board meets Putnam’s independence standards; if the company’s board does not meet Putnam’s independence standards, then Putnam will vote against these proposals. |
| Ø | Putnam will vote for proposals renewing partial takeover provisions. |
| Ø | Putnam will vote on a case-by-case basis on Board-Spill proposals. |
Turkey
| Ø | Putnam will vote on a case-by-case basis on proposals involving related party transactions. However, Putnam will vote against when such proposals do not provide information on the specific transaction(s) to be entered into with the board members or executives. |
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| ITEM 13. | PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. |
(a)(1): As of the date of filing this report:
The officers of the investment manager identified below are primarily responsible for the day-to-day management of the fund’s portfolio as of the filing date of this report. Effective September 30, 2024, James Conn, Francisco Rivera, Daniel Workman and Benjamin Barber were added as Portfolio Managers of the fund.
| Portfolio Managers | Joined Fund | Employer | Positions Over Past Five Years |
| Benjamin Barber, CFA | 2024 |
Franklin Advisors 2020 – Present |
Portfolio Manager |
| James Conn, CFA | 2024 |
Franklin Advisors 1987 – Present |
Portfolio Manager |
| Paul Drury, CFA | 2002 |
Franklin Advisors 2024 – Present Putnam Investments 1989-2024 |
Portfolio Manager |
| Garrett Hamilton, CFA | 2016 |
Franklin Advisors 2024 – Present Putnam Investments 2016-2024 |
Portfolio Manager |
| Francisco Rivera | 2024 |
Franklin Advisors 1994 – Present |
Portfolio Manager |
| Daniel Workman, CFA | 2024 |
Franklin Advisors 2003 – Present |
Portfolio Manager |
Effective May 30, 2025, Paul M Drury retired and stepped down as a member of the Fund’s portfolio management team.
(a)(2): Other Accounts Managed by the Fund’s Portfolio Managers.
The following table shows the number and approximate assets of other investment accounts (or portions of investment accounts) that the fund’s Portfolio Managers managed as of the fund’s most recent fiscal year-end. Unless noted, none of the other accounts pays a fee based on the account’s performance.
|
Portfolio Leader or Member |
Other SEC-registered open-end and closed-end funds |
Other accounts that pool assets from more than one client |
Other accounts (including separate accounts, managed account programs and single-sponsor defined contribution plan offerings) | |||
| | Number of accounts | Assets | Number of accounts | Assets | Number of accounts | Assets |
| Benjamin Barber | 14 | $20,560,800,000 | 3 | $275,200,000 | 4 | $294,200,000 |
| James Conn | 14 | $20,592,900,000 | 3 | $275,200,000 | 5 | $687,900,000 |
| Paul Drury | 17 | $22,411,500,000 | 0 | $0 | 0 | $0 |
| Garrett Hamilton | 17 | $21,102,500,000 | 2 | $238,100,000 | 0 | $0 |
| Francisco Rivera | 14 | $20,560,800,000 | 0 | $0 | 131 | $9,527,300,000 |
| Daniel Workman | 14 | $20,560,800,000 | 0 | $0 | 3 | $6,800,000 |
| |
Potential conflicts of interest in managing multiple accounts. Like other investment professionals with multiple clients, the fund’s Portfolio Managers may face certain potential conflicts of interest in connection with managing both the fund and the other accounts listed under “Other Accounts Managed by the Fund’s Portfolio Managers” at the same time. The paragraphs below describe some of these potential conflicts, which the investment manager believes are faced by investment professionals at most major financial firms. As described below, the investment manager and the Trustees of the Putnam funds have adopted compliance policies and procedures that attempt to address certain of these potential conflicts.
The management of accounts with different advisory fee rates and/or fee structures, including accounts that pay advisory fees based on account performance (“performance fee accounts”), may raise potential conflicts of interest by creating an incentive to favor higher-fee accounts. These potential conflicts may include, among others:
• The most attractive investments could be allocated to higher-fee accounts or performance fee accounts.
• The trading of higher-fee accounts could be favored as to timing and/or execution price. For example, higher-fee accounts could be permitted to sell securities earlier than other accounts when a prompt sale is desirable or to buy securities at an earlier and more opportune time.
• The trading of other accounts could be used to benefit higher-fee accounts (front- running).
• The investment management team could focus their time and efforts primarily on higher-fee accounts due to a personal stake in compensation.
The investment manager attempts to address these potential conflicts of interest relating to higher-fee accounts through various compliance policies that are generally intended to place all accounts, regardless of fee structure, on the same footing for investment management purposes. For example, under the investment manager’s policies:
• Performance fee accounts must be included in all standard trading and allocation procedures with all other accounts.
• All accounts must be allocated to a specific category of account and trade in parallel with allocations of similar accounts based on the procedures generally applicable to all accounts in those groups (e.g., based on relative risk budgets of accounts).
• All trading must be effected through Putnam’s trading desks and normal queues and procedures must be followed (i.e., no special treatment is permitted for performance fee accounts or higher-fee accounts based on account fee structure).
• Front running is strictly prohibited.
• The fund’s Portfolio Manager(s) may not be guaranteed or specifically allocated any portion of a performance fee.
As part of these policies, the investment manager has also implemented trade oversight and review procedures in order to monitor whether particular accounts (including higher-fee accounts or performance fee accounts) are being favored over time.
Potential conflicts of interest may also arise when the Portfolio Manager(s) have personal investments in other accounts that may create an incentive to favor those accounts. As a general matter and subject to limited exceptions, the investment managers investment professionals do not have the opportunity to invest in client accounts, other than the Putnam funds. However, in the ordinary course of business, the investment manager or related persons may from time to time establish “pilot” or “incubator” funds for the purpose of testing proposed investment strategies and products prior to offering them to clients. These pilot accounts may be in the form of registered investment companies, private funds such as partnerships or separate accounts established by Putnam Management or an affiliate. The investment manager or an affiliate supplies the funding for these accounts. Putnam employees, including the fund’s Portfolio Manager(s), may also invest in certain pilot accounts. The investment manager, and to the extent applicable, the Portfolio Manager(s) will benefit from the favorable investment performance of those funds and accounts. Pilot funds and accounts may, and frequently
| |
do, invest in the same securities as the client accounts. The investment manager policy is to treat pilot accounts in the same manner as client accounts for purposes of trading allocation – neither favoring nor disfavoring them except as is legally required. For example, pilot accounts are normally included in the investment managers daily block trades to the same extent as client accounts (except that pilot accounts do not participate in initial public offerings).
A potential conflict of interest may arise when the fund and other accounts purchase or sell the same securities. On occasions when the Portfolio Manager(s) consider the purchase or sale of a security to be in the best interests of the fund as well as other accounts, the investment managers trading desk may, to the extent permitted by applicable laws and regulations, aggregate the securities to be sold or purchased in order to obtain the best execution and lower brokerage commissions, if any. Aggregation of trades may create the potential for unfairness to the fund or another account if one account is favored over another in allocating the securities purchased or sold – for example, by allocating a disproportionate amount of a security that is likely to increase in value to a favored account. The investment manager trade allocation policies generally provide that each day’s transactions in securities that are purchased or sold by multiple accounts are, insofar as possible, averaged as to price and allocated between such accounts (including the fund) in a manner which in Franklin Advisers opinion is equitable to each account and in accordance with the amount being purchased or sold by each account. Certain exceptions exist for specialty, regional or sector accounts. Trade allocations are reviewed on a periodic basis as part of the investment managers trade oversight procedures in an attempt to ensure fairness over time across accounts.
“Cross trades,” in which one Putnam account sells a particular security to another account (potentially saving transaction costs for both accounts), may also pose a potential conflict of interest. Cross trades may be seen to involve a potential conflict of interest if, for example, one account is permitted to sell a security to another account at a higher price than an independent third party would pay, or if such trades result in more attractive investments being allocated to higher-fee accounts. The investment manager and the fund’s Trustees have adopted compliance procedures that provide that any transactions between the fund and another Putnam-advised account are to be made at an independent current market price, as required by law.
Another potential conflict of interest may arise based on the different investment objectives and strategies of the fund and other accounts. For example, another account may have a shorter-term investment horizon or different investment objectives, policies or restrictions than the fund. Depending on another account’s objectives or other factors, the Portfolio Manager(s) may give advice and make decisions that may differ from advice given, or the timing or nature of decisions made, with respect to the fund. In addition, investment decisions are the product of many factors in addition to basic suitability for the particular account involved. Thus, a particular security may be bought or sold for certain accounts even though it could have been bought or sold for other accounts at the same time. More rarely, a particular security may be bought for one or more accounts managed by the Portfolio Manager(s) when one or more other accounts are selling the security (including short sales). There may be circumstances when purchases or sales of portfolio securities for one or more accounts may have an adverse effect on other accounts. As noted above, the investment manager has implemented trade oversight and review procedures to monitor whether any account is systematically favored over time.
The fund’s Portfolio Manager(s) may also face other potential conflicts of interest in managing the fund, and the description above is not a complete description of every conflict that could be deemed to exist in managing both the fund and other accounts.
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(a)(3): Compensation of portfolio managers
The Investment Manager seeks to maintain a compensation program that is competitively positioned to attract, retain and motivate top-quality investment professionals. Portfolio managers receive a base salary, a cash incentive bonus opportunity, an equity compensation opportunity, and a benefits package. Portfolio manager compensation is reviewed annually, and the level of compensation is based on individual performance, the salary range for a portfolio manager’s level of responsibility and Franklin Templeton guidelines. Portfolio managers are provided no financial incentive to favor one fund or account over another. Each portfolio manager’s compensation consists of the following three elements:
Base salary Each portfolio manager is paid a base salary.
Annual bonus Annual bonuses are structured to align the interests of the portfolio manager with those of the Fund’s shareholders. Each portfolio manager is eligible to receive an annual bonus. Bonuses generally are split between cash (50% to 65%) and restricted shares of Franklin Resources, Inc (“Resources”) stock and mutual fund shares. The deferred equity-based compensation is intended to build a vested interest of the portfolio manager in the financial performance of both Resources and mutual funds advised by the Investment Manager. The bonus plan is intended to provide a competitive level of annual bonus compensation that is tied to the portfolio manager achieving consistently strong investment performance, which aligns the financial incentives of the portfolio manager and Fund shareholders. The Chief Investment Officer of the Investment Manager and/or other officers of the Investment Manager, with responsibility for the Fund, have discretion in the granting of annual bonuses to portfolio managers in accordance with Franklin Templeton guidelines. The following factors are generally used in determining bonuses under the plan:
| · | Investment performance. Primary consideration is given to the historic investment performance over the 1, 3 and 5 preceding years of all accounts managed by the portfolio manager. The pre-tax performance of each fund managed is measured relative to a relevant peer group and/or applicable benchmark as appropriate. |
| · | Non-investment performance. The more qualitative contributions of the portfolio manager to the Investment Manager’s business and the investment management team, including professional knowledge, productivity, responsiveness to client needs and communication, are evaluated in determining the amount of any bonus award. |
| · | Responsibilities. The characteristics and complexity of funds managed by the portfolio manager are factored in the Investment Manager’s appraisal. |
Additional long-term equity-based compensation Portfolio managers may also be awarded restricted shares or units of Resources stock or restricted shares or units of one or more mutual funds. Awards of such deferred equity-based compensation typically vest over time, so as to create incentives to retain key talent.
Benefits Portfolio managers also participate in benefit plans and programs available generally to all employees of the Investment Manager.
(a)(4): Ownership of Fund shares
The following table shows the dollar ranges of shares of the fund owned by the professionals listed above at the end of the fund’s last two fiscal years, including investments by their immediate family members and amounts invested through retirement and deferred compensation plans.
| |
*Assets in the fund
| | Year/Period end | $0 |
$0- $10,000 |
$10,001- $50,000 |
$50,001- $100,000 |
$100,001- $500,000 |
$500,001- $1,000,000 |
$1,000,001 and over |
| Benjamin Barber | 2024+ | * | | | | | | |
| James Conn | 2024+ | * | | | | | | |
| Paul M. Drury | 2024 | | | | | | | |
| | 2023 | * | | | | | | |
| Garrett Hamilton | 2024 | * | | | | | | |
| | 2023 | * | | | | | | |
| Francisco Rivera | 2024+ | * | | | | | | |
| Daniel Workman | 2024+ | * | | | | | | |
+: Became a portfolio manager of the fund effective September 30, 2024.
(b) Not applicable.
| ITEM 14. |
PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. |
| | (a) | (b) | (c) | (d) |
| Period |
Total Number of Shares Purchased |
Average Price Paid per Share |
Total Number of Shares Purchased as Part of Publicly Announced Plans or Program* |
Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs** |
| Month #1 (11/1/24 - 11/30/24) | 299,804 | 10.51 | 299,804 | 2,506,859 |
| Month #2 (12/1/24 - 12/31/24) | 368,716 | 10.38 | 368,716 | 2,138,143 |
| Month #3 (1/1/25 - 1/31/25) | 367,211 | 10.34 | 367,211 | 1,770,932 |
| Month #4 (2/1/25 - 2/28/25) | 0 | 0.00 | 0 | 1,770,932 |
| Month #5 (3/1/25 - 3/31/25) | 176,364 | 10.31 | 176,364 | 1,594,568 |
| Month #6 (4/1/25 - 4/30/25) | 326,085 | 9.76 | 326,085 | 1,268,483 |
| Total | 1,538,180 | | 1,538,180 | |
| * | In October 2005, the Board of Trustees of the Putnam Funds initiated the closed-end fund share repurchase program, which, as subsequently amended, authorized the fund to repurchase of up to 10% of its fund’s outstanding common shares over the two-years ending October 5, 2007. The Trustees have subsequently renewed the program on an annual basis. The program renewed by the Board in September 2023, which was in effect between October 1, 2023 and September 30, 2024, allowed the fund to repurchase up to 3,266,513 of its shares. The program renewed by the Board in September 2024, which is in effect between October 1, 2024 and September 30, 2025, allows the fund to repurchase up to 2,976,642 of its shares. |
| ** | Information prior to October 1, 2024, is based on the total number of shares eligible for repurchase under the program, as amended through September 2023. Information from October 1, 2024 forward is based on the total number of shares eligible for repurchase under the program, as amended through September 2024. |
| ITEM 15. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. |
There have been no changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees that would require disclosure herein.
| ITEM 16. | CONTROLS AND PROCEDURES. |
| (a) | The Registrant’s chief executive officer and principal financial officer have concluded that the Registrant’s disclosure controls and procedures (as defined in Rule 30a- 3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the disclosure controls and procedures required by Rule 30a-3(b) under the 1940 Act and 15d-15(b) under the Securities Exchange Act of 1934. |
| (b) | During the period covered by this report, the Registrant transitioned to a new third-party service provider who performs certain accounting and administrative services for the Registrant that are subject to Franklin Templeton’s oversight. |
| |
| ITEM 17. |
DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANY. |
Not applicable.
| ITEM 18. | RECOVERY OF ERRONEOUSLY AWARDED COMPENSATION. |
| (a) | Not applicable. |
| (b) | Not applicable. |
| ITEM 19. | EXHIBITS. |
(a) (1) Code of Ethics attached hereto.
Exhibit 99.CODE ETH
(a) (3) Certifications pursuant to section 302 of the Sarbanes-Oxley Act of 2002 attached hereto.
Exhibit 99.CERT
(b) Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 attached hereto.
Exhibit 99.906CERT
(c) Pursuant to the Securities and Exchange Commission’s Order granting relief from Section 19(b) of the Investment Company Act of 1940, the 19(a) Notices to Beneficial Owners are attached hereto as Exhibit.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this Report to be signed on its behalf by the undersigned, there unto duly authorized.
Putnam Municipal Opportunities Trust
| By: | /s/ Jane Trust | | |
| | Jane Trust | | |
| | Principal Executive Officer | | |
| | | | |
| Date: | June 26, 2025 | | |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| By: | /s/ Jane Trust | |
| | Jane Trust | |
| | Principal Executive Officer | |
| | | |
| Date: | June 26, 2025 | |
| By: | /s/ Christopher Berarducci | |
| | Christopher Berarducci | |
| | Principal Financial Officer | |
| | | |
| Date: | June 26, 2025 | |
| |
FAQ
What was Putnam Municipal Opportunities Trust’s (PMO) total return for fiscal 2025?
How much is PMO’s new monthly distribution?
What percentage of 2025 distributions was return of capital?
Did PMO change its investment strategy during the period?
Who are the new portfolio managers added to PMO?
When will long-time manager Paul Drury retire?
