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 811-04708
---------------------------------------------
SunAmerica Income Funds
--------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
Harborside 5, 185 Hudson Street, Suite 3300, Jersey City, NJ 07311
--------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
John T. Genoy
Senior Vice President
SunAmerica Asset Management, LLC
Harborside 5,
185 Hudson Street, Suite 3300,
Jersey City, NJ 07311
--------------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (201) 324-6414
-----------------------------
Date of fiscal year end: March 31
--------------------------
Date of reporting period: March 31, 2019
-------------------------
Item 1. Reports to Stockholders
ANNUAL REPORT 2019
SUNAMERICA
Income Funds
[PHOTO]
Beginning on January 1, 2021, as permitted by regulations adopted by the
Securities and Exchange Commission, paper copies of each Fund's shareholder
reports will no longer be sent by mail, unless you specifically request paper
copies of the reports from the Fund or your financial intermediary. Instead,
the reports will be made available on a website, and you will be notified by
mail each time a report is posted and provided with a website link to access
the report.
If you already elected to receive shareholder reports electronically, you will
not be affected by this change and you need not take any action. At any time,
you may elect to receive reports and other communications from a Fund
electronically by calling 800-858-8850 or contacting your financial
intermediary directly.
You may elect to receive all future reports in paper free of charge. If your
account is held directly at the Fund, you can inform the Fund that you wish to
receive paper copies of reports by calling 800-858-8850. If your account is
held through a financial intermediary, please contact the financial
intermediary to make this election. Your election to receive paper will apply
to all AIG Funds in which you are invested and may apply to all funds held with
your financial intermediary.
[LOGO]
aig.com/funds
Table of Contents
SHAREHOLDER LETTER...................................... 2
EXPENSE EXAMPLE......................................... 4
STATEMENTS OF ASSETS AND LIABILITIES.................... 6
STATEMENTS OF OPERATIONS................................ 8
STATEMENTS OF CHANGES IN NET ASSETS..................... 9
FINANCIAL HIGHLIGHTS.................................... 10
PORTFOLIO OF INVESTMENTS................................ 13
NOTES TO FINANCIAL STATEMENTS........................... 67
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM. 83
TRUSTEE AND OFFICER INFORMATION......................... 84
SHAREHOLDER TAX INFORMATION............................. 87
COMPARISONS: PORTFOLIOS vs. INDICES..................... 88
SUPPLEMENT TO THE PROSPECTUS............................ 95
Shareholder Letter -- (unaudited)
Dear Shareholders,
We are pleased to present this annual update for the SunAmerica Income Funds
(the "Income Funds") for the 12-month period ended March 31, 2019. From a broad
perspective, it was a period wherein fixed income market performance was
primarily driven by economic data, central bank monetary policy and
geopolitics. Overall, U.S. Treasuries performed well, while non-government bond
sector performance was mixed during the annual period.
As the annual period began in April 2018, fixed income markets were focused on
interest rates, trade policies and emerging markets volatility - and the
potential impact of these factors on global economic growth. With a hawkish+
U.S. Federal Reserve (the "Fed"), markets adjusted to more interest rate
increases than were anticipated at the beginning of 2018. Upward movement in
rates, combined with U.S. dollar strength, also filtered into emerging markets
concerns. There were also worries stemming from the political arena, where
escalating trade war tensions devolved into tit-for-tat tariff actions that
increased fears of a global trade war. In turn, for the second quarter of 2018,
most non-government bond sectors broadly weakened, though U.S. high yield
corporate bonds proved an exception. In June 2018, the Fed raised the targeted
federal funds rate.
Amid progress on trade, solid second quarter corporate earnings and an
expanding global economy, led by the U.S., non-government bond sectors
performed well during the third quarter of 2018. Even as the economies of the
Eurozone, the U.K. and China softened, emerging markets debt and high yield
corporate bonds posted the strongest gains within the fixed income market. In
September 2018, the Fed delivered the eighth interest rate increase of its
current tightening cycle and projected one more increase by the end of 2018 and
three more in 2019. Coupled with low inflation, U.S. Treasury rates rose in
response, followed, in turn, by the interest rates of other developed market
nations.
The picture changed in the fourth quarter of 2018, as non-government bond
sectors were pressured by equity market declines, tighter financial conditions,
mainly in the U.S., slower global economic growth, sharp declines in oil and
other commodity prices, Saudi Arabian-driven geopolitical concerns, Italy's
budget woes and an uncertain outcome to Brexit, or the U.K.'s path out of the
European Union. In particular, U.S. corporate bonds experienced weakness. U.S.
Treasury yields, conversely, fell as investors grew fearful about the possible
end of the global economic cycle. This, in turn, led to diminished expectations
for further Fed interest rate raises. In December, Fed policy makers delivered
their ninth interest rate increase of the current cycle.
In the first quarter of 2019, non-government bond sectors broadly posted gains,
as dovish pivots by global central banks, including the Fed, progress on
U.S.-China trade talks and stable or better-than-expected corporate earnings
boosted investor sentiment and helped fuel rallies in both sovereign government
bonds and riskier segments of the fixed income market. Notably, high yield
corporate bonds recorded their strongest start to a calendar year on record.
For the annual period overall, the Bloomberg Barclays U.S. Aggregate Bond
Index,/*/ a broad measure of the U.S. fixed income market, returned 4.48%. The
U.S. Treasury yield curve flattened++/ /during the annual period, as yields on
shorter-term maturities rose and yields on intermediate- and longer-term
maturities fell. The yield on the bellwether 10-year U.S. Treasury fell
approximately 33 basis points/**/ during the annual period to end at 2.41%.
Among non-U.S. Treasury sectors, high yield corporate bonds outperformed U.S.
Treasuries the most for the annual period as a whole, followed by commercial
mortgage-backed securities and asset-backed securities. Sovereign emerging
markets debt underperformed U.S. Treasuries, followed at some distance by
investment grade corporate bonds, agency securities and mortgage-backed
securities.
2
On the following pages, you will find financial statements and portfolio
information for each of the Income Funds during the annual period ended
March 31, 2019.
We thank you for being a part of AIG Funds. We value your ongoing confidence in
us and look forward to serving your investment needs in the future. As always,
if you have any questions regarding your investments, please contact your
financial advisor or get in touch with us directly at 800-858-8850 or via our
website at www.aig.com/funds.
Sincerely,
The SunAmerica Income Funds Investment Professionals
Timothy Campion Robert Vanden Assem David L. Albrycht
Elizabeth Mauro Dana Burns Frank Ossino
John Yovanovic Anders Faergemann Jonathan Stanley
--------
Past performance is no guarantee of future results.
+ Hawkish tends to suggest higher interest rates; opposite of dovish.
* The Bloomberg Barclays U.S. Aggregate Bond Index represents securities that
are SEC-registered, taxable and dollar denominated. The index covers the U.S.
investment-grade fixed-rate bond market, with index components for government
and corporate securities, mortgage pass-through securities and asset-backed
securities. Indices are not managed and an investor cannot invest directly in
an index.
++A flattening yield curve is one wherein the differential in yields between
longer-term and shorter-term maturities narrows.
**A basis point is 1/100/th/ of a percentage point.
3
SunAmerica Income Funds
EXPENSE EXAMPLE -- March 31, 2019 -- (unaudited)
Disclosure of Portfolio Expenses in Shareholder Reports
As a shareholder of a fund (each, a "Fund" and collectively the "Funds") in the
SunAmerica Income Funds (the "Trust"), you may incur two types of costs: (1)
transaction costs, including sales charges (loads) on purchase payments,
contingent deferred sales charges and (2) ongoing costs, including management
fees, distribution and service fees and other Fund expenses. The example set
forth below is intended to help you understand your ongoing costs (in dollars)
of investing in the Funds and to compare these costs with the ongoing costs of
investing in other mutual funds. The Example is based on an investment of
$1,000 invested at October 1, 2018 and held until March 31, 2019.
Actual Expenses
The "Actual" section of the table provides information about actual account
values and actual expenses. You may use the information in these columns,
together with the amount you invested, to estimate the expenses that you paid
over the period. Simply divide your account value by $1,000 (for example, an
$8,600 account value divided by $1,000 = 8.6), then multiply the result by the
number in the column under the heading entitled "Expenses Paid During the Six
Months Ended March 31, 2019" to estimate the expenses you paid on your account
during this period. The "Expenses Paid During the Six Months Ended March 31,
2019" column and the "Annualized Expense Ratio" column do not include small
account fees that may be charged if your account balance is below $500 ($250
for retirement plan accounts). In addition, the "Expenses Paid During the Six
Months Ended March 31, 2019" column and the "Annualized Expense Ratio" column
do not include administrative fees that may apply to qualified retirement plan
accounts. See the Funds' prospectuses, your retirement plan document and/or
materials from your financial adviser for a full description of these fees. Had
these fees been included, the "Expenses Paid During the Six Months Ended March
31, 2019" column would have been higher and the "Ending Account Value" column
would have been lower.
Hypothetical Example for Comparison Purposes
The "Hypothetical" section of the table provides information about hypothetical
account values and hypothetical expenses based on each Fund's actual expense
ratio and an annual rate of return of 5% before expenses, which is not the
Fund's actual return. The hypothetical account values and expenses may not be
used to estimate the actual ending account balance or expenses you paid for the
period. You may use this information to compare the ongoing costs of investing
in the Funds and other funds. To do so, compare this 5% hypothetical example
with the 5% hypothetical examples that appear in the shareholder reports of
other funds. The "Expenses Paid During the Six Months Ended March 31, 2019"
column and the "Annualized Expense Ratio" column do not include small account
fees that may be charged if your account balance is below $500 ($250 for
retirement plan accounts). In addition, the "Expenses Paid During the Six
Months Ended March 31, 2019" column and the "Annualized Expense Ratio" column
do not include administrative fees that may apply to qualified retirement plan
accounts and accounts held through financial institutions. See the Funds'
prospectuses, your retirement plan document and/or materials from your
financial adviser for a full description of these fees. Had these fees been
included, the "Expenses Paid During the Six Months Ended March 31, 2019" column
would have been higher and the "Ending Account Value" column would have been
lower.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transaction costs, including sales
charges on purchase payments, contingent deferred sales charges, small account
fees and administrative fees, if applicable to your account. Please refer to
the Funds' prospectus, your retirement plan document and/or material from your
financial adviser, for more information. Therefore, the "Hypothetical" example
is useful in comparing ongoing costs only, and will not help you determine the
relative total costs of owning different funds. In addition, if these
transaction costs and other fees were included, your costs would have been
higher.
4
SunAmerica Income Funds
EXPENSE EXAMPLE -- March 31, 2019 -- (unaudited) (continued)
Actual Hypothetical
------------------------------------------ ------------------------------------------
Ending Account
Ending Account Expenses Paid Value using Expenses Paid
Value using During the a Hypothetical During the
Beginning Actual Six Months Beginning 5% Annual Six Months
Account Value Return at Ended Account Value Return at Ended Annualized
at October 1, March 31, March 31, at October 1, March 31, March 31, Expense
Fund 2018 2019 2019 2018 2019 2019 Ratio*
---- ------------- -------------- ------------- ------------- -------------- ------------- ----------
AIG U.S. Government Securities#
Class A....................... $1,000.00 $1,032.62 $5.02 $1,000.00 $1,020.00 $4.99 0.99%
Class C....................... $1,000.00 $1,029.32 $8.30 $1,000.00 $1,016.75 $8.25 1.64%
AIG Strategic Bond#
Class A....................... $1,000.00 $1,027.37 $5.71 $1,000.00 $1,019.30 $5.69 1.13%
Class B....................... $1,000.00 $1,023.73 $9.33 $1,000.00 $1,015.71 $9.30 1.85%
Class C....................... $1,000.00 $1,023.99 $9.08 $1,000.00 $1,015.96 $9.05 1.80%
Class W....................... $1,000.00 $1,031.70 $4.61 $1,000.00 $1,020.39 $4.58 0.91%
AIG Flexible Credit#
Class A....................... $1,000.00 $1,004.83 $5.35 $1,000.00 $1,019.60 $5.39 1.07%
Class C....................... $1,000.00 $ 998.90 $8.62 $1,000.00 $1,016.31 $8.70 1.73%
Class W....................... $1,000.00 $1,005.96 $4.30 $1,000.00 $1,020.64 $4.33 0.86%
--------
* Expenses are equal to each Fund's annualized expense ratio multiplied by the
average account value over the period, multiplied by 182 days then divided
by 365 days (to reflect the one-half year period). These ratios do not
reflect transaction costs, including sales charges on purchase payments,
contingent deferred sales charges, small account fees and administrative
fees, if applicable to your account. Please refer to your Prospectus, your
retirement plan documents and/or materials from your financial adviser for
more information.
# During the stated period, the investment advisor either waived a portion of
or all of the fees and assumed a portion of or all expenses for the Funds.
As a result, if these fees and expenses had not been waived or assumed, the
"Actual/Hypothetical Ending Account Value" would have been lower and the
"Actual/Hypothetical Expenses Paid During the Six Months Ended March 31,
2019" and the "Annualized Expense Ratio" would have been higher.
5
SunAmerica Income Funds
STATEMENTS OF ASSETS AND LIABILITIES -- March 31, 2019
AIG U.S. Government AIG Strategic AIG Flexible
Securities Bond Credit
Fund Fund Fund
------------------- ------------- ------------
ASSETS:
Investments at value (unaffiliated)*........................ $130,948,136 $276,826,684 $325,654,168
Repurchase agreements (cost approximates value)............. 3,170,000 -- --
Cash........................................................ 197 1,042,234 --
Foreign cash*............................................... -- -- --
Receivable for:
Shares of beneficial interest sold......................... 9,576 103,218 832,439
Dividends and interest..................................... 656,151 2,903,363 3,430,135
Investments sold........................................... -- 1,960,722 511,102
Investments sold on an extended settlement basis........... -- 1,623,284 1,641,771
Prepaid expenses and other assets........................... 6,781 6,448 6,469
Due from investment adviser for expense reimbursements/fee
waivers.................................................... 80,063 119,782 198,476
Unrealized appreciation on forward foreign currency
contracts.................................................. -- 177,745 --
------------ ------------ ------------
TOTAL ASSETS................................................ 134,870,904 284,763,480 332,274,560
------------ ------------ ------------
LIABILITIES:
Payable for:
Shares of beneficial interest redeemed..................... 992,010 1,415,231 1,346,846
Investments purchased...................................... -- 2,374,785 10,208,159
Investments purchased on an extended settlement basis...... -- 4,880,370 7,995,760
Investment advisory and management fees.................... 74,004 151,421 193,475
Distribution and service maintenance fees.................. 44,042 111,384 99,523
Transfer agent fees and expenses........................... 31,113 58,570 69,209
Trustees' fees and expenses................................ 1,089 2,637 2,251
Other accrued expenses..................................... 96,928 188,671 178,057
Dividends Payable........................................... 5,547 108,927 391,841
Due to custodian for foreign cash*.......................... -- 636 --
Commitments (Note 10)....................................... -- 15,925 --
Unrealized depreciation on forward foreign currency
contracts.................................................. -- 3,651 --
------------ ------------ ------------
TOTAL LIABILITIES........................................... 1,244,733 9,312,208 20,485,121
------------ ------------ ------------
NET ASSETS.................................................. $133,626,171 $275,451,272 $311,789,439
============ ============ ============
NET ASSETS REPRESENTED BY:
Shares of beneficial interest, $0.01........................ $ 147,746 $ 831,449 $ 940,177
Paid-in capital............................................. 150,306,070 310,058,232 331,474,199
Total accumulated earnings (loss)........................... (16,827,645) (35,438,409) (20,624,937)
------------ ------------ ------------
NET ASSETS.................................................. $133,626,171 $275,451,272 $311,789,439
============ ============ ============
*Cost
Investments (unaffiliated)................................. $127,207,064 $279,240,093 $335,594,265
============ ============ ============
Foreign cash............................................... $ -- $ (566) $ --
============ ============ ============
See Notes to Financial Statements
6
SunAmerica Income Funds
STATEMENTS OF ASSETS AND LIABILITIES -- March 31, 2019 -- (continued)
AIG U.S. Government AIG Strategic AIG Flexible
Securities Bond Credit
Fund Fund Fund
------------------- ------------- ------------
Class A (unlimited shares authorized):
Net assets....................................................... $126,119,100 $153,979,123 $119,902,690
Shares of beneficial interest issued and outstanding............. 13,944,234 46,486,333 36,218,423
Net asset value and redemption price per share (excluding any
applicable contingent deferred sales charge) ................... $ 9.04 $ 3.31 $ 3.31
Maximum sales charge (4.75% of offering price)................... $ 0.45 $ 0.17 $ 0.17
------------ ------------ ------------
Maximum offering price to public................................. $ 9.49 $ 3.48 $ 3.48
============ ============ ============
Class B (unlimited shares authorized):
Net assets....................................................... $ -- $ 16,014,639 $ --
Shares of beneficial interest issued and outstanding............. -- 4,838,888 --
Net asset value, offering and redemption price per share
(excluding any applicable contingent deferred sales charge)..... $ -- $ 3.31 $ --
============ ============ ============
Class C (unlimited shares authorized):
Net assets....................................................... $ 7,507,071 $ 52,781,978 $ 55,504,863
Shares of beneficial interest issued and outstanding............. 830,383 15,882,948 16,664,927
Net asset value, offering and redemption price per share
(excluding any applicable contingent deferred sales charge)..... $ 9.04 $ 3.32 $ 3.33
============ ============ ============
Class W (unlimited shares authorized):
Net assets....................................................... $ -- $ 52,675,532 $136,381,886
Shares of beneficial interest issued and outstanding............. -- 15,936,719 41,134,375
Net asset value, offering and redemption price per share......... $ -- $ 3.31 $ 3.32
============ ============ ============
See Notes to Financial Statements
7
SunAmerica Income Funds
STATEMENTS OF OPERATIONS -- For the Year Ended March 31, 2019
AIG U.S. Government AIG Strategic AIG Flexible
Securities Bond Credit
Fund Fund Fund
------------------- ------------- ------------
INVESTMENT INCOME:
Dividends (unaffiliated)............................... $ -- $ 78,536 $ 128,797
Interest (unaffiliated)................................ 3,432,365 14,975,584 20,685,622
---------- ----------- -----------
Total investment income*............................. 3,432,365 15,054,120 20,814,419
---------- ----------- -----------
EXPENSES:
Investment advisory and management fees................ 898,249 1,947,730 2,420,251
Distribution and Service maintenance fees:
Class A.............................................. 429,796 583,865 445,659
Class B.............................................. -- 181,325 --
Class C.............................................. 72,073 591,952 561,237
Service fee -- Class W................................. -- 81,782 212,727
Transfer agent fees:
Class A.............................................. 311,061 392,431 303,212
Class B.............................................. -- 43,338 --
Class C.............................................. 19,072 139,542 129,220
Class W.............................................. -- 121,181 314,098
Registration fees:
Class A.............................................. 23,133 25,260 29,614
Class B.............................................. -- 13,792 --
Class C.............................................. 14,479 17,326 18,831
Class W.............................................. -- 15,987 30,085
Custodian and accounting fees.......................... 29,285 112,996 77,020
Reports to shareholders................................ 32,034 92,262 91,762
Audit and tax fees..................................... 56,542 79,382 80,914
Legal fees............................................. 23,349 32,645 31,678
Trustees' fees and expenses............................ 8,717 19,586 20,305
Interest expense....................................... -- 2,677 15,857
Other expenses......................................... 22,251 32,190 28,983
---------- ----------- -----------
Total expenses before fee waivers, expense
reimbursements and expense recoupments.............. 1,940,041 4,527,249 4,811,453
---------- ----------- -----------
Net (fees waived and expenses reimbursed) recouped
by investment advisor (Note 3)...................... (524,883) (695,934) (1,262,897)
---------- ----------- -----------
Net expenses......................................... 1,415,158 3,831,315 3,548,556
---------- ----------- -----------
Net investment income (loss)............................ 2,017,207 11,222,805 17,265,863
---------- ----------- -----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FOREIGN CURRENCIES:
Net realized gain (loss) on:
Investments (unaffiliated)............................. (208,411) (9,586,814) (3,697,570)
Forward contracts...................................... -- 1,797,853 --
Net realized foreign exchange gain (loss) on other
assets and liabilities................................. -- (16,748) (778)
---------- ----------- -----------
Net realized gain (loss) on investments and foreign
currencies............................................. (208,411) (7,805,709) (3,698,348)
---------- ----------- -----------
Change in unrealized appreciation (depreciation) on:
Investments (unaffiliated)............................. 1,808,397 3,933,465 (5,841,893)
Forward contracts...................................... -- 141,170 --
Change in unrealized foreign exchange gain (loss) on
other assets and liabilities........................... -- (8,435) 143
---------- ----------- -----------
Net unrealized gain (loss) on investments and foreign
currencies............................................. 1,808,397 4,066,200 (5,841,750)
---------- ----------- -----------
Net realized and unrealized gain (loss) on investments
and foreign currencies................................. 1,599,986 (3,739,509) (9,540,098)
---------- ----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS............................................. 3,617,193 7,483,296 7,725,765
========== =========== ===========
*Net of foreign withholding taxes on interest and
dividends of........................................... $ -- $ (96) $ --
========== =========== ===========
See Notes to Financial Statements
8
SunAmerica Income Funds
STATEMENTS OF CHANGES IN NET ASSETS
AIG U.S. Government
Securities Fund AIG Strategic Bond Fund
-------------------------- --------------------------
For the year For the year For the year For the year
ended ended ended ended
March 31, March 31, March 31, March 31,
2019 2018 2019 2018
------------ ------------ ------------ ------------
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income (loss)..................... $ 2,017,207 $ 1,524,997 $ 11,222,805 $ 10,794,518
Net realized gain (loss) on investments and
foreign currencies............................. (208,411) (638,420) (7,805,709) 2,956,711
Net unrealized gain (loss) on investments and
foreign currencies............................. 1,808,397 (1,565,538) 4,066,200 (6,160,474)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets resulting
from operations.................................. 3,617,193 (678,961) 7,483,296 7,590,755
------------ ------------ ------------ ------------
Distributions to shareholders from(1):
Distributable earnings (Class A)................. (2,199,690) (2,487,089) (8,027,157) (5,155,583)
Distributable earnings (Class B)................. -- -- (733,209) (637,563)
Distributable earnings (Class C)................. (74,757) (174,406) (2,446,003) (2,616,763)
Distributable earnings (Class W)................. -- -- (2,727,614) (1,770,057)
------------ ------------ ------------ ------------
Total distributions to shareholders............... (2,274,447) (2,661,495) (13,933,983) (10,179,966)
------------ ------------ ------------ ------------
Net increase (decrease) in net assets resulting
from capital share transactions (Note 6)......... (13,952,704) (18,398,158) (78,026,418) 848,412
------------ ------------ ------------ ------------
Total increase (decrease) in net assets........... (12,609,958) (21,738,614) (84,477,105) (1,740,799)
NET ASSETS:
Beginning of period............................... 146,236,129 167,974,743 359,928,377 361,669,176
------------ ------------ ------------ ------------
End of period..................................... $133,626,171 $146,236,129 $275,451,272 $359,928,377
============ ============ ============ ============
AIG Flexible Credit Fund
--------------------------
For the year For the year
ended ended
March 31, March 31,
2019 2018
------------ ------------
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income (loss)..................... $ 17,265,863 $ 16,611,951
Net realized gain (loss) on investments and
foreign currencies............................. (3,698,348) 1,837,310
Net unrealized gain (loss) on investments and
foreign currencies............................. (5,841,750) (5,216,653)
------------ ------------
Net increase (decrease) in net assets resulting
from operations.................................. 7,725,765 13,232,608
------------ ------------
Distributions to shareholders from(1):
Distributable earnings (Class A)................. (6,972,042) (6,747,881)
Distributable earnings (Class B)................. -- --
Distributable earnings (Class C)................. (2,643,846) (2,890,712)
Distributable earnings (Class W)................. (7,914,239) (7,204,700)
------------ ------------
Total distributions to shareholders............... (17,530,127) (16,843,293)
------------ ------------
Net increase (decrease) in net assets resulting
from capital share transactions (Note 6)......... (1,830,641) (49,463,029)
------------ ------------
Total increase (decrease) in net assets........... (11,635,003) (53,073,714)
NET ASSETS:
Beginning of period............................... 323,424,442 376,498,156
------------ ------------
End of period..................................... $311,789,439 $323,424,442
============ ============
--------
(1)The prior year amounts have been restated to reflect the adoption of
amendments to Rule 6-09.3 of Regulation S-X. Below are the amounts as stated
in the March 31, 2018 annual report.
Distributions to shareholders from:
Net investment income (Class A).... $(2,487,089) $ (5,155,583) $ (6,747,881)
Net investment income (Class B).... -- (637,563) --
Net investment income (Class C).... (174,406) (2,616,763) (2,890,712)
Net investment income (Class W).... -- (1,770,057) (7,204,700)
----------- ------------ ------------
$(2,661,495) $(10,179,966) $(16,843,293)
=========== ============ ============
See Notes to Financial Statements
9
SunAmerica Income Funds
FINANCIAL HIGHLIGHTS
AIG U.S. GOVERNMENT SECURITIES FUND
-----------------------------------
Net gain
(loss) on
Net investments Distributions Net Net
Asset (both Dividends from net Asset Assets, Ratio of
Value, Net realized Total from from net realized Total Value, end of expenses
beginning investment and investment investment gains on Distri- end of Total period to average
Period Ended of period income(1) unrealized) operations income investments butions period Return(2) (000's) net assets(3)
------------ --------- ---------- ----------- ---------- ---------- ------------- ------- ------ --------- -------- -------------
Class A
-------
03/31/15 $9.43 $0.12 $ 0.34 $ 0.46 $(0.16) $-- $(0.16) $9.73 4.94% $187,417 0.99%
03/31/16 9.73 0.08 (0.05) 0.03 (0.17) -- (0.17) 9.59 0.33 156,468 0.99
03/31/17 9.59 0.09 (0.37) (0.28) (0.16) -- (0.16) 9.15 (2.93) 148,382 0.99
03/31/18 9.15 0.09 (0.13) (0.04) (0.16) -- (0.16) 8.95 (0.46) 138,599 0.99
03/31/19 8.95 0.13 0.11 0.24 (0.15) -- (0.15) 9.04 2.71 126,119 0.99
Class C
-------
03/31/15 $9.42 $0.06 $ 0.34 $ 0.40 $(0.10) $-- $(0.10) $9.72 4.27% $ 23,999 1.64%
03/31/16 9.72 0.01 (0.03) (0.02) (0.11) -- (0.11) 9.59 (0.22) 31,665 1.64
03/31/17 9.59 0.02 (0.37) (0.35) (0.10) -- (0.10) 9.14 (3.66) 19,592 1.64
03/31/18 9.14 0.04 (0.13) (0.09) (0.10) -- (0.10) 8.95 (1.00) 7,637 1.64
03/31/19 8.95 0.08 0.10 0.18 (0.09) -- (0.09) 9.04 2.05 7,507 1.64
Ratio
of net
investment
income to
average Portfolio
net assets(3) Turnover
------------- ---------
1.24% 57%
0.81 36
0.91 95
1.03 29
1.49 18
0.61% 57%
0.16 36
0.26 95
0.38 29
0.84 18
--------
(1)Calculated based upon average shares outstanding.
(2)Total return does not reflect sales load, but does include expense
reimbursements.
(3)Net of the following expense reimbursements, if applicable (based on average
net assets):
03/31/15 03/31/16 03/31/17 03/31/18 03/31/19
-------- -------- -------- -------- --------
AIG U.S. Government Securities Fund Class A 0.38% 0.37% 0.35% 0.37% 0.37%
AIG U.S. Government Securities Fund
Class C................................... 0.50 0.39 0.40 0.46 0.59
See Notes to Financial Statements
10
SunAmerica Income Funds
FINANCIAL HIGHLIGHTS -- (continued)
AIG STRATEGIC BOND FUND
-----------------------
Net gain
(loss) on
Net investments Distributions Net Net
Asset (both Dividends from net Asset Assets,
Value, Net realized Total from from net realized Total Value, end of
beginning investment and investment investment gains on Distri- end of Total period
Period Ended of period income(1) unrealized) operations income investments butions period Return(2) (000's)
-------------------- --------- ---------- ----------- ---------- ---------- ------------- ------- ------ --------- --------
Class A
-------
03/31/15 $3.53 $0.13 $(0.04) $ 0.09 $(0.13) $-- $(0.13) $3.49 2.70% $235,093
03/31/16 3.49 0.12 (0.20) (0.08) (0.14) -- (0.14) 3.27 (2.32) 175,386
03/31/17 3.27 0.10 0.14 0.24 (0.11) -- (0.11) 3.40 7.38 163,163
03/31/18 3.40 0.11 (0.03) 0.08 (0.10) -- (0.10) 3.38 2.41 196,712
03/31/19 3.38 0.13 (0.04) 0.09 (0.16) -- (0.16) 3.31 2.86 153,979
Class B
-------
03/31/15 $3.53 $0.10 $(0.03) $ 0.07 $(0.11) $-- $(0.11) $3.49 2.01% $ 39,733
03/31/16 3.49 0.10 (0.20) (0.10) (0.12) -- (0.12) 3.27 (2.97) 31,038
03/31/17 3.27 0.08 0.14 0.22 (0.09) -- (0.09) 3.40 6.66 29,762
03/31/18 3.40 0.09 (0.04) 0.05 (0.08) -- (0.08) 3.37 1.41 21,875
03/31/19 3.37 0.11 (0.03) 0.08 (0.14) -- (0.14) 3.31 2.43 16,015
Class C
-------
03/31/15 $3.54 $0.11 $(0.04) $ 0.07 $(0.11) $-- $(0.11) $3.50 2.05% $184,282
03/31/16 3.50 0.10 (0.19) (0.09) (0.12) -- (0.12) 3.29 (2.63) 151,197
03/31/17 3.29 0.08 0.13 0.21 (0.09) -- (0.09) 3.41 6.35 128,332
03/31/18 3.41 0.09 (0.03) 0.06 (0.08) -- (0.08) 3.39 1.75 71,103
03/31/19 3.39 0.11 (0.04) 0.07 (0.14) -- (0.14) 3.32 2.18 52,782
Class W
-------
01/29/15(4)-03/31/15 $3.48 $0.01 $ 0.02 $ 0.03 $(0.02) $-- $(0.02) $3.49 0.99% $ 15,664
03/31/16 3.49 0.12 (0.20) (0.08) (0.14) -- (0.14) 3.27 (2.14) 30,065
03/31/17 3.27 0.11 0.13 0.24 (0.12) -- (0.12) 3.39 7.26 40,412
03/31/18 3.39 0.11 (0.02) 0.09 (0.11) -- (0.11) 3.37 2.65 70,239
03/31/19 3.37 0.14 (0.03) 0.11 (0.17) -- (0.17) 3.31 3.38 52,676
Ratio
of net
Ratio of investment
expenses income to
to average average Portfolio
net assets net assets Turnover
---------- ---------- ---------
1.30% 3.62% 137%
1.34 3.54 108
1.32 3.00 109
1.33 3.15 149
1.14(3) 3.89(3) 123
1.97% 2.95% 137%
2.01 2.87 108
1.99 2.33 109
2.02 2.46 149
1.86(3) 3.17(3) 123
1.94% 2.98% 137%
1.98 2.90 108
1.97 2.35 109
1.98 2.50 149
1.81(3) 3.22(3) 123
1.20%(3)(5) 2.73%(3)(5) 137%
1.15 3.71 108
1.14 3.20 109
1.14 3.34 149
0.94(3) 4.06(3) 123
--------
(1)Calculated based upon average shares outstanding.
(2)Total return is not annualized and does not reflect sales load, but does
include expense reimbursements.
(3)Net of the following expense reimbursements and waivers, if applicable
(based on average net assets):
03/31/15 03/31/16 03/31/17 03/31/18 03/31/19
-------- -------- -------- -------- --------
AIG Strategic Bond Fund Class A......... -- -- -- -- 0.23%
AIG Strategic Bond Fund Class B......... -- -- -- -- 0.23
AIG Strategic Bond Fund Class C......... -- -- -- -- 0.23
AIG Strategic Bond Fund Class W......... 0.69%(5) -- -- -- 0.23
(4)Inception date of class.
(5)Annualized.
See Notes to Financial Statements
11
SunAmerica Income Funds
FINANCIAL HIGHLIGHTS -- (continued)
AIG FLEXIBLE CREDIT FUND
------------------------
Net gain
(loss) on
Net investments Distributions Net
Asset (both Dividends from net Asset Net Assets,
Value, Net realized Total from from net realized Total Value, end of
beginning investment and investment investment gains on Distri- end of Total period
Period Ended of period income(1) unrealized) operations income investment butions period Return(2) (000's)
-------------------- --------- ---------- ----------- ---------- ---------- ------------- ------- ------ --------- -----------
Class A
-------
03/31/15 $3.59 $0.15 $(0.11) $ 0.04 $(0.17) $-- $(0.17) $3.46 1.06% $127,508
03/31/16 3.46 0.13 (0.16) (0.03) (0.14) -- (0.14) 3.29 (0.93) 125,775
03/31/17 3.29 0.14 0.16 0.30 (0.15) -- (0.15) 3.44 9.11 144,880
03/31/18 3.44 0.16 (0.04) 0.12 (0.16) -- (0.16) 3.40 3.54 133,268
03/31/19 3.40 0.18 (0.09) 0.09 (0.18) -- (0.18) 3.31 2.75 119,903
Class C
-------
03/31/15 $3.61 $0.13 $(0.11) $ 0.02 $(0.15) $-- $(0.15) $3.48 0.43% $ 45,411
03/31/16 3.48 0.11 (0.16) (0.05) (0.12) -- (0.12) 3.31 (1.54) 61,891
03/31/17 3.31 0.12 0.15 0.27 (0.12) -- (0.12) 3.46 8.38 74,241
03/31/18 3.46 0.14 (0.04) 0.10 (0.14) -- (0.14) 3.42 2.88 58,994
03/31/19 3.42 0.16 (0.09) 0.07 (0.16) -- (0.16) 3.33 2.09 55,505
Class W
-------
10/01/14(4)-03/31/15 $3.50 $0.06 $(0.01) $ 0.05 $(0.08) $-- $(0.08) $3.47 1.57% $ 13,632
03/31/16 3.47 0.13 (0.17) (0.04) (0.14) -- (0.14) 3.29 (1.02) 90,441
03/31/17 3.29 0.15 0.15 0.30 (0.15) -- (0.15) 3.44 9.34 157,377
03/31/18 3.44 0.17 (0.04) 0.13 (0.17) -- (0.17) 3.40 3.76 131,163
03/31/19 3.40 0.18 (0.07) 0.11 (0.19) -- (0.19) 3.32 3.26 136,382
Ratio
of net
Ratio of investment
expenses income to
to average average Portfolio
net assets net assets Turnover
---------- ---------- ---------
1.41%(3) 4.50%(3) 74%
1.45(3) 3.92(3) 52
1.43 4.21 69
1.33(3) 4.60(3) 63
1.06(3) 5.29(3) 57
2.06%(3) 3.88%(3) 74%
2.10(3) 3.27(3) 52
2.07 3.57 69
1.99(3) 3.94(3) 63
1.72(3) 4.63(3) 57
1.25%(3)(5) 4.25%(3)(5) 74%
1.25(3) 4.11(3) 52
1.21 4.44 69
1.12(3) 4.79(3) 63
0.85(3) 5.50(3) 57
--------
(1)Calculated based upon average shares outstanding.
(2)Total return is not annualized and does not reflect sales load, but does
include expense reimbursements.
(3)Net of the following expense reimbursements and waivers, if applicable
(based on average net assets):
03/31/15 03/31/16 03/31/17 03/31/18 03/31/19
-------- -------- -------- -------- --------
AIG Flexible Credit Fund Class A........ 0.19% 0.03% --% 0.11% 0.39%
AIG Flexible Credit Fund Class C........ 0.20 0.02 -- 0.11 0.39
AIG Flexible Credit Fund Class W........ 1.12(5) 0.04 -- 0.11 0.39
(4)Inception date of class.
(5)Annualized.
See Notes to Financial Statements
12
AIG U.S. Government Securities Fund
PORTFOLIO PROFILE -- March 31, 2019 -- (unaudited)
Industry Allocation*
United States Treasury Notes.... 55.0%
Government National Mtg. Assoc.. 20.2
United States Treasury Bonds.... 12.2
Federal Home Loan Mtg. Corp..... 6.9
Repurchase Agreements........... 2.4
Federal National Mtg. Assoc..... 1.9
Federal Home Loan Bank.......... 1.8
-----
100.4%
=====
Credit Quality+#
Aaa........ 98.9%
Not Rated@. 1.1
-----
100.0%
=====
--------
*Calculated as a percentage of net assets
+Source: Moody's
#Calculated as a percentage of total debt issues, excluding short-term
securities.
@Represents debt issues that either have no rating, or the rating is
unavailable from the data source.
13
AIG U.S. Government Securities Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019
Principal Value
Security Description Amount (Note 2)
U.S. GOVERNMENT AGENCIES -- 30.8%
Federal Home Loan Bank -- 1.8%
1.69% due 02/26/2021............... $ 480,000 $ 473,857
2.14% due 12/05/2022............... 372,093 368,853
4.50% due 09/13/2019............... 1,490,000 1,503,532
----------
2,346,242
----------
Federal Home Loan Mtg. Corp. -- 6.9%
3.50% due 08/01/2030............... 2,384,458 2,444,891
3.50% due 12/01/2044............... 4,078,452 4,168,345
4.00% due 04/01/2034............... 1,222,103 1,271,155
Federal Home Loan Mtg. Corp. REMIC
Series 3747, Class WA
3.50% due 10/15/2030(1)............ 1,357,680 1,388,966
----------
9,273,357
----------
Federal National Mtg. Assoc. -- 1.9%
2.50% due 11/01/2027............... 2,596,368 2,594,933
----------
Government National Mtg. Assoc. -- 20.2%
3.50% due 03/15/2042............... 258,147 265,027
3.50% due 06/15/2042............... 1,412,361 1,450,173
3.50% due 07/15/2042............... 370,119 379,969
3.50% due 02/20/2045............... 757,833 775,611
4.00% due 03/15/2039............... 148,037 153,878
4.00% due 06/15/2039............... 322,394 334,120
4.00% due 12/15/2039............... 206,486 214,525
4.00% due 08/15/2040............... 150,645 156,571
4.00% due 11/15/2040............... 313,220 325,525
4.00% due 09/15/2041............... 839,664 872,376
4.00% due 10/15/2041............... 100,487 104,433
4.00% due 11/15/2041............... 499,368 517,608
4.00% due 12/15/2041............... 388,428 402,071
4.00% due 01/15/2042............... 1,210,208 1,254,467
4.00% due 02/15/2042............... 323,910 336,549
4.00% due 03/15/2042............... 141,574 147,068
4.50% due 09/15/2033............... 227,525 238,360
4.50% due 04/15/2039............... 51,937 54,654
4.50% due 05/15/2039............... 96,624 101,661
4.50% due 06/15/2039............... 1,022,103 1,075,183
4.50% due 07/15/2039............... 292,433 307,602
4.50% due 09/15/2039............... 141,953 149,362
4.50% due 11/15/2039............... 90,980 95,747
4.50% due 12/15/2039............... 266,689 280,553
4.50% due 02/15/2040............... 679,793 714,284
4.50% due 03/15/2040............... 305,539 321,531
4.50% due 04/15/2040............... 128,193 134,865
4.50% due 07/15/2040............... 366,026 385,163
4.50% due 03/15/2041............... 977,214 1,028,119
4.50% due 04/15/2041............... 174,249 181,917
4.50% due 06/15/2041............... 117,050 121,862
4.50% due 08/15/2041............... 137,562 143,237
4.50% due 04/20/2044............... 554,533 583,652
5.00% due 08/15/2033............... 288,737 309,941
5.00% due 10/15/2033............... 487,342 512,343
5.00% due 05/15/2035............... 76,316 79,653
5.00% due 08/15/2035............... 265,649 285,158
5.00% due 05/15/2036............... 65,849 70,714
5.00% due 09/15/2036............... 104,220 111,900
5.00% due 01/15/2037............... 151,433 162,452
5.00% due 03/15/2037............... 40,233 43,201
5.00% due 04/15/2037............... 239,328 251,323
Principal Value
Security Description Amount (Note 2)
Government National Mtg. Assoc. (continued)
5.00% due 04/15/2038........ $ 346,981 $ 370,622
5.00% due 05/15/2038........ 167,050 179,312
5.00% due 08/15/2038........ 401,683 425,686
5.00% due 02/15/2039........ 71,506 76,749
5.00% due 03/15/2039........ 109,127 117,228
5.00% due 04/15/2039........ 77,409 83,157
5.00% due 07/20/2039........ 752,077 804,589
5.00% due 08/15/2039........ 209,418 224,791
5.00% due 09/20/2039........ 2,468,567 2,640,754
5.00% due 10/15/2039........ 477,153 509,034
5.00% due 11/15/2039........ 401,933 431,554
5.00% due 12/15/2039........ 366,090 393,129
5.00% due 04/15/2040........ 348,022 365,616
5.00% due 05/15/2040........ 700,932 742,096
5.00% due 07/20/2045........ 306,248 327,448
5.50% due 06/15/2033........ 441,768 485,602
5.50% due 07/15/2033........ 83,641 91,965
5.50% due 10/15/2033........ 119,869 131,831
5.50% due 01/15/2034........ 362,803 397,636
5.50% due 02/15/2034........ 230,797 248,031
5.50% due 04/20/2035........ 361,907 396,597
5.50% due 09/15/2035........ 337,744 373,307
5.50% due 10/15/2035........ 151,971 167,121
5.50% due 02/15/2038........ 115,668 127,227
5.50% due 04/15/2038........ 68,119 74,614
5.50% due 09/15/2039........ 50,612 54,372
5.50% due 03/15/2040........ 226 248
6.00% due 04/15/2028........ 110,235 121,913
6.00% due 08/15/2033........ 191,494 215,129
6.00% due 12/15/2033........ 59,258 64,208
6.00% due 09/20/2038........ 770,429 851,588
6.50% due 10/15/2031........ 41,672 45,748
-----------
26,973,310
-----------
Total U.S. Government Agencies
(cost $41,881,833).......... 41,187,842
-----------
U.S. GOVERNMENT TREASURIES -- 67.2%
United States Treasury Bonds -- 12.2%
2.50% due 02/15/2045........ 1,000,000 943,516
4.25% due 11/15/2040........ 8,000,000 10,019,687
4.75% due 02/15/2041........ 4,000,000 5,350,469
-----------
16,313,672
-----------
United States Treasury Notes -- 55.0%
0.88% due 04/15/2019........ 2,500,000 2,498,506
1.38% due 12/15/2019........ 3,000,000 2,977,734
1.38% due 04/30/2020........ 2,500,000 2,472,559
1.38% due 05/31/2021........ 21,000,000 20,602,148
1.50% due 06/15/2020........ 3,000,000 2,967,883
1.50% due 02/28/2023........ 2,000,000 1,945,000
1.63% due 08/31/2019........ 2,000,000 1,992,422
1.88% due 03/31/2022........ 2,500,000 2,474,805
2.00% due 01/31/2020........ 3,000,000 2,990,039
2.00% due 09/30/2020........ 3,000,000 2,984,180
2.00% due 08/31/2021........ 2,000,000 1,987,422
2.00% due 02/15/2025........ 5,000,000 4,918,164
2.00% due 08/15/2025........ 3,000,000 2,944,336
2.00% due 11/15/2026........ 2,700,000 2,634,293
14
AIG U.S. Government Securities Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
U.S. GOVERNMENT TREASURIES (continued)
United States Treasury Notes (continued)
2.13% due 08/31/2020............... $2,500,000 $ 2,491,797
2.13% due 03/31/2024............... 2,000,000 1,988,906
2.25% due 02/29/2020............... 2,000,000 1,997,187
2.25% due 11/15/2027............... 2,000,000 1,978,750
2.38% due 12/31/2020............... 2,000,000 2,001,641
2.63% due 02/28/2023............... 3,000,000 3,043,477
2.75% due 11/15/2023............... 2,500,000 2,554,590
3.13% due 05/15/2019............... 1,000,000 1,000,783
------------
73,446,622
------------
Total U.S. Government Treasuries
(cost $85,325,231)................. 89,760,294
------------
Total Long-Term Investment Securities
(cost $127,207,064)................ 130,948,136
------------
Principal Value
Security Description Amount (Note 2)
REPURCHASE AGREEMENTS -- 2.4%
Agreement with Fixed Income Clearing Corp.,
bearing interest at 0.50%, dated
03/29/2019, to be repurchased 04/01/2019
in the amount of $3,170,132 and
collateralized by $3,180,000 of United States
Treasury Notes, bearing interest at 2.63%,
due 02/28/2023 and having an approximate
value of $3,237,609
(cost $3,170,000).............................. $3,170,000 3,170,000
------------
TOTAL INVESTMENTS
(cost $130,377,064)(2)......................... 100.4% 134,118,136
Liabilities in excess of other assets............. (0.4) (491,965)
---------- ------------
NET ASSETS 100.0% $133,626,171
========== ============
--------
(1) Collateralized Mortgage Obligation
(2) See Note 5 for cost of investments on a tax basis.
REMIC --Real Estate Mortgage Investment Conduit
The following is a summary of the inputs used to value the Fund's net assets as
of March 31, 2019 (see Note 2):
Level 1 --Unadjusted Level 2 -- Other Level 3 --Significant
Quoted Prices Observable Inputs Unobservable Inputs Total
- -------------------- ----------------- --------------------- ------------
ASSETS:
Investments at Value:*
U.S. Government Agencies... $-- $ 41,187,842 $-- $ 41,187,842
U.S. Government Treasuries. -- 89,760,294 -- 89,760,294
Repurchase Agreements...... -- 3,170,000 -- 3,170,000
--- ------------ --- ------------
Total Investments at Value. $-- $134,118,136 $-- $134,118,136
=== ============ === ============
--------
* For a detailed presentation of investments, please refer to the Portfolio of
Investments.
See Notes to Financial Statements
15
AIG Strategic Bond Fund
PORTFOLIO PROFILE -- March 31, 2019 -- (unaudited)
Industry Allocation*
Federal National Mtg. Assoc............ 18.4%
Sovereign.............................. 10.9
Federal Home Loan Mtg. Corp............ 6.5
Registered Investment Companies........ 3.9
Diversified Banking Institutions....... 3.4
Diversified Financial Services......... 2.8
Cable/Satellite TV..................... 2.3
Oil Companies-Exploration & Production. 2.1
Pipelines.............................. 2.0
Real Estate Investment Trusts.......... 1.8
Government National Mtg. Assoc......... 1.7
Banks-Commercial....................... 1.7
Cellular Telecom....................... 1.6
Telephone-Integrated................... 1.5
Electric-Integrated.................... 1.4
United States Treasury Notes........... 1.2
Oil Companies-Integrated............... 1.1
Finance-Consumer Loans................. 0.9
Medical-Drugs.......................... 0.9
Chemicals-Diversified.................. 0.8
Oil-Field Services..................... 0.8
Satellite Telecom...................... 0.7
Enterprise Software/Service............ 0.7
Television............................. 0.6
Cosmetics & Toiletries................. 0.5
Computers.............................. 0.5
Metal-Diversified...................... 0.5
Retail-Restaurants..................... 0.5
Containers-Metal/Glass................. 0.5
Banks-Super Regional................... 0.5
Electric-Generation.................... 0.4
Food-Misc./Diversified................. 0.4
Applications Software.................. 0.4
Real Estate Operations & Development... 0.4
Building-Heavy Construction............ 0.4
Agricultural Chemicals................. 0.4
Batteries/Battery Systems.............. 0.4
Medical Labs & Testing Services........ 0.4
Transport-Marine....................... 0.4
Machinery-Farming...................... 0.4
Real Estate Management/Services........ 0.4
Computer Services...................... 0.4
Auto-Cars/Light Trucks................. 0.4
Metal Processors & Fabrication......... 0.4
Insurance-Property/Casualty............ 0.4
Metal-Copper........................... 0.4
Rental Auto/Equipment.................. 0.4
Auto-Heavy Duty Trucks................. 0.4
Paper & Related Products............... 0.4
Diversified Manufacturing Operations... 0.4
Building & Construction-Misc........... 0.3
Security Services...................... 0.3
Medical-Hospitals...................... 0.3
Transport-Rail......................... 0.3
Gambling (Non-Hotel)................... 0.3
Oil Field Machinery & Equipment........ 0.3
Food-Meat Products..................... 0.3
Commercial Services-Finance............ 0.3
Building & Construction Products-Misc.. 0.3
Medical-Generic Drugs.................. 0.3
Steel-Producers....................... 0.3%
Hotels/Motels......................... 0.3
Oil & Gas Drilling.................... 0.3
Finance-Investment Banker/Broker...... 0.3
Computers-Integrated Systems.......... 0.3
Transport-Equipment & Leasing......... 0.3
Diversified Minerals.................. 0.3
Aerospace/Defense-Equipment........... 0.3
Electronic Parts Distribution......... 0.3
Computer Software..................... 0.3
Poultry............................... 0.3
Consumer Products-Misc................ 0.3
Distribution/Wholesale................ 0.3
Publishing-Books...................... 0.3
Finance-Credit Card................... 0.2
Dialysis Centers...................... 0.2
Savings & Loans/Thrifts............... 0.2
Medical-l-IMO......................... 0.2
Containers-Paper/Plastic.............. 0.2
Machinery-Construction & Mining....... 0.2
Finance-Mortgage Loan/Banker.......... 0.2
Pharmacy Services..................... 0.2
Multimedia............................ 0.2
Energy-Alternate Sources.............. 0.2
Internet Content-Entertainment........ 0.2
Coal.................................. 0.2
Airport Development/Maintenance....... 0.2
Diagnostic Equipment.................. 0.2
Electronic Components-Semiconductors.. 0.2
Insurance-Multi-line.................. 0.2
Retail-Appliances..................... 0.2
Retail-Automobile..................... 0.2
Auto/Truck Parts & Equipment-Original. 0.2
Casino Services....................... 0.2
Disposable Medical Products........... 0.2
Brewery............................... 0.2
Chemicals-Fibers...................... 0.2
Radio................................. 0.2
Metal-Iron............................ 0.2
Finance-Other Services................ 0.2
Retail-Pawn Shops..................... 0.2
Food-Retail........................... 0.2
Investment Companies.................. 0.2
Broadcast Services/Program............ 0.2
Beverages-Non-alcoholic............... 0.2
Building Societies.................... 0.2
Banks-Export/Import................... 0.2
Computers-Memory Devices.............. 0.2
Internet Connectivity Services........ 0.2
Chemicals-Specialty................... 0.2
Electronic Security Devices........... 0.2
Finance-Commercial.................... 0.2
Electric-Distribution................. 0.2
Machinery-General Industrial.......... 0.2
Insurance-Life/Health................. 0.1
Insurance Brokers..................... 0.1
Medical Products...................... 0.1
E-Commerce/Services................... 0.1
Theaters.............................. 0.1
Food-Dairy Products................... 0.1
16
AIG Strategic Bond Fund
PORTFOLIO PROFILE -- March 31, 2019 -- (unaudited) (continued)
Industry Allocation* (continued)
Retail-Vitamins & Nutrition Supplements. 0.1%
Finance-Leasing Companies............... 0.1
Telecommunication Equipment............. 0.1
Finance-Auto Loans...................... 0.1
Human Resources......................... 0.1
Water................................... 0.1
Retail-Petroleum Products............... 0.1
Retail-Office Supplies.................. 0.1
Telecom Services........................ 0.1
Trucking/Leasing........................ 0.1
Casino Hotels........................... 0.1
Transport-Truck......................... 0.1
Semiconductor Equipment................. 0.1
Sovereign Agency........................ 0.1
Electronic Measurement Instruments...... 0.1
Transport-Services...................... 0.1
Marine Services......................... 0.1
Medical-Wholesale Drug Distribution..... 0.1
Diamonds/Precious Stones................ 0.1
Auto Repair Centers..................... 0.1
Machinery-Pumps......................... 0.1
Building Products-Air & Heating......... 0.1
Retail-Mail Order....................... 0.1
Medical-Biomedical/Gene................. 0.1
Banks-Special Purpose................... 0.1
Platinum................................ 0.1
Banks-Money Center...................... 0.1
Consulting Services..................... 0.1
Building-Maintenance & Services......... 0.1
Medical Instruments..................... 0.1
Travel Services......................... 0.1
Quarrying............................... 0.1
Internet Financial Services............. 0.1
Building Products-Doors & Windows....... 0.1
Hazardous Waste Disposal................ 0.1
Resorts/Theme Parks..................... 0.1
Retail-Major Department Stores.......... 0.1
Data Processing/Management.............. 0.1
Retail-1-lypermarkets................... 0.1
Chemicals-Plastics...................... 0.1
-----
100.5%
=====
Credit Quality+#
Aaa........ 30.1%
Aa......... 1.5
A.......... 5.7
Baa........ 15.0
Ba......... 14.5
B.......... 22.1
Caa........ 4.3
Not Rated@. 6.8
-----
100.0%
=====
--------
*Calculated as a percentage of net assets
+Source: Moody's
#Calculated as a percentage of total debt issues, excluding short-term
securities.
@Represents debt issues that either have no rating, or the rating is
unavailable from the data source.
17
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019
Principal Value
Security Description Amount(5) (Note 2)
ASSET BACKED SECURITIES -- 2.8%
Diversified Financial Services -- 2.8%
American Express Credit Account Master Trust
Series 2018-4, Class A
2.99% due 12/15/2023.......................... $ 100,000 $ 100,946
American Express Credit Account Master Trust
Series 2018-8, Class A
3.18% due 04/15/2024.......................... 167,000 169,475
Americredit Automobile Receivables Trust
Series 2019-1, Class A3
2.97% due 11/20/2023.......................... 200,000 201,112
Avis Budget Rental Car Funding AESOP LLC
Series 2015-1A, Class A
2.50% due 07/20/2021*......................... 100,000 99,531
BA Credit Card Trust
Series 2018-A2, Class A2
3.00% due 09/15/2023.......................... 204,000 205,904
BANK
Series 2019-BN16, Class A2
3.93% due 02/15/2052(1)....................... 239,000 248,949
Benchmark Mtg. Trust
Series 2019-B9, Class AAB
3.93% due 03/15/2052(1)....................... 300,000 316,508
Benchmark Mtg. Trust
Series 2018-B7, Class A4
4.51% due 05/15/2053(1)....................... 1,000,000 1,101,073
CarMax Auto Owner Trust
Series 2018-4, Class A3
3.36% due 09/15/2023.......................... 200,000 203,366
Chase Mtg. Finance Trust VRS
Series 2016-2, Class M2
3.75% due 12/25/2045*(2)(3)................... 339,092 344,464
Citibank Credit Card Issuance Trust
Series 2018-A1, Class A1
2.49% due 01/20/2023.......................... 100,000 99,855
Citibank Credit Card Issuance Trust
Series 2018-A6, Class A6
3.21% due 12/07/2024.......................... 100,000 102,124
COMM Mtg. Trust VRS
Series 2016-787S, Class B
3.83% due 02/10/2036*(1)(3)................... 132,000 136,252
CORE Mtg. Trust FRS
Series 2019-CORE, Class A
3.38% (1 ML+0.88%)
due 12/15/2031*(1)............................ 390,000 390,122
Discover Card Execution Note Trust
Series 2015-A4, Class A4
2.19% due 04/17/2023.......................... 117,000 116,380
Discover Card Execution Note Trust
Series 2019-A1, Class A1
3.04% due 07/15/2024.......................... 100,000 101,343
Ford Credit Auto Owner Trust
Series 2018-2, Class A
3.47% due 01/15/2030*......................... 100,000 101,747
Ford Credit Floorplan Master Owner Trust
Series 2017-1, Class A1
2.07% due 05/15/2022.......................... 81,000 80,405
Principal Value
Security Description Amount(5) (Note 2)
Diversified Financial Services (continued)
GS Mtg. Securities Trust
Series 2015-GC28, Class A2
2.90% due 02/10/2048(1).......................... $102,000 $ 102,020
Honda Auto Receivables Owner Trust
Series 2019 -1, Class A3
2.83% due 03/20/2023............................. 70,000 70,431
ILPT Trust
Series 2019-SURF, Class A
4.15% due 02/11/2041*(1)......................... 590,000 624,468
JP Morgan Mortgage Trust VRS
Series 2017-6, Class A6
3.00% due 12/25/2048*(2)(3)...................... 860,325 846,748
JP Morgan Mtg. Trust VRS
Series 2018-1, Class A5
3.50% due 06/25/2048*(2)(3)...................... 695,743 696,070
Mercedes-Benz Auto Lease Trust
Series 2019-A, Class A4
3.25% due 10/15/2024............................. 31,000 31,248
Mercedes-Benz Auto Lease Trust
Series 2018-B, Class A4
3.31% due 07/15/2024............................. 321,000 324,902
Morgan Stanley Capital Barclays Bank Trust
Series 2016-MART, Class A
2.20% due 09/13/2031*(1)......................... 185,000 182,426
MTRO Commercial Mtg. Trust-TECH FRS
Series 2019-TECH, Class A
3.38% (1 ML+0.90%)
due 12/15/2033*(1)............................... 350,000 350,438
Shellpoint Co-Originator Trust VRS
Series 2017-2, Class A1
3.50% due 10/25/2047*(2)(3)...................... 180,606 179,786
Synchrony Credit Card Master Note Trust
Series 2016-2, Class A
2.21% due 05/15/2024............................. 100,000 99,145
Toyota Auto Receivables Owner Trust
Series 2018-C, Class A4
3.13% due 02/15/2024............................. 125,000 126,939
World Financial Network Credit Card Master Trust
Series 2017-C, Class A
2.31% due 08/15/2024............................. 100,000 99,264
----------
Total Asset Backed Securities
(cost $7,712,177)................................ 7,853,441
----------
U.S. CORPORATE BONDS & NOTES -- 33.9%
Advertising Agencies -- 0.0%
Interpublic Group of Cos., Inc.
Senior Notes
4.20% due 04/15/2024............................. 70,000 72,001
Interpublic Group of Cos., Inc.
Senior Notes
5.40% due 10/01/2048............................. 53,000 53,620
----------
125,621
----------
Aerospace/Defense -- 0.0%
General Dynamics Corp.
Company Guar. Notes
2.88% due 05/11/2020............................. 106,000 106,351
----------
18
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Aerospace/Defense-Equipment -- 0.3%
Harris Corp.
Senior Notes
4.40% due 06/15/2028................ $ 153,000 $ 160,907
L3 Technologies, Inc.
Company Guar. Notes
4.40% due 06/15/2028................ 66,000 69,255
United Technologies Corp.
Senior Notes
1.15% due 05/18/2024................ EUR 275,000 316,378
United Technologies Corp.
Senior Notes
3.95% due 08/16/2025................ 187,000 194,215
----------
740,755
----------
Agricultural Chemicals -- 0.0%
Mosaic Co.
Senior Notes
5.63% due 11/15/2043................ 48,000 50,922
----------
Airlines -- 0.0%
Atlas Air, Inc.
Pass-Through Certs.
Series 1999-1, Class B
7.63% due 01/02/2020(4)............. 24,546 24,688
----------
Applications Software -- 0.4%
CDK Global, Inc.
Senior Notes
5.88% due 06/15/2026................ 391,000 409,690
Microsoft Corp.
Senior Notes
3.13% due 12/06/2028................ EUR 235,000 323,990
SS&C Technologies, Inc.
Company Guar. Notes
5.50% due 09/30/2027*............... 420,000 424,200
----------
1,157,880
----------
Auto-Cars/Light Trucks -- 0.4%
Daimler Finance North America LLC
Company Guar. Notes
2.00% due 07/06/2021*............... 78,000 76,313
Daimler Finance North America LLC
Company Guar. Notes
3.75% due 11/05/2021*............... 150,000 152,628
General Motors Financial Co, Inc.
Company Guar. Notes
1.69% due 03/26/2025................ EUR 185,000 204,248
General Motors Financial Co., Inc.
Company Guar. Notes
3.70% due 05/09/2023................ 95,000 94,495
Hyundai Capital America
Senior Notes
3.95% due 02/01/2022*............... 136,000 137,947
Nissan Motor Acceptance Corp.
Senior Notes
2.65% due 07/13/2022*............... 234,000 228,440
Principal Value
Security Description Amount(5) (Note 2)
Auto-Cars/Light Trucks (continued)
Toyota Motor Credit Corp.
Senior Notes
3.45% due 09/20/2023........ $ 110,000 $ 113,396
----------
1,007,467
----------
Auto-Heavy Duty Trucks -- 0.3%
Allison Transmission, Inc.
Senior Notes
5.00% due 10/01/2024*....... 361,000 360,098
JB Poindexter & Co., Inc.
Senior Notes
7.13% due 04/15/2026*....... 440,000 441,245
----------
801,343
----------
Banks-Commercial -- 0.5%
BankUnited, Inc.
Senior Notes
4.88% due 11/17/2025........ 358,000 372,825
Regions Financial Corp.
Sub. Notes
7.38% due 12/10/2037........ 218,000 290,638
SunTrust Bank
Senior Notes
3.20% due 04/01/2024........ 266,000 268,205
SunTrust Bank
Senior Notes
3.50% due 08/02/2022........ 108,000 109,518
Webster Financial Corp.
Senior Notes
4.10% due 03/25/2029........ 190,000 189,970
----------
1,231,156
----------
Banks-Super Regional -- 0.4%
Bank of America NA
Senior Notes
3.34% due 01/25/2023........ 250,000 253,124
Wells Fargo & Co.
Senior Notes
1.00% due 02/02/2027........ EUR 300,000 334,799
Wells Fargo & Co.
Senior Notes
3.55% due 09/29/2025........ 269,000 273,427
Wells Fargo Bank NA
Sub. Notes
5.25% due 08/01/2023........ GBP 100,000 146,829
----------
1,008,179
----------
Batteries/Battery Systems -- 0.4%
Energizer Holdings, Inc.
Company Guar. Notes
6.38% due 07/15/2026*....... 485,000 497,125
EnerSys
Company Guar. Notes
5.00% due 04/30/2023*....... 605,000 601,975
----------
1,099,100
----------
19
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Beverages-Non-alcoholic -- 0.2%
Coca-Cola Co.
Senior Notes
1.25% due 03/08/2031................... EUR 130,000 $147,744
Keurig Dr Pepper, Inc.
Company Guar. Notes
4.42% due 05/25/2025*.................. 205,000 212,431
PepsiCo., Inc.
Senior Notes
2.75% due 04/30/2025................... 101,000 101,141
--------
461,316
--------
Beverages-Wine/Spirits -- 0.0%
Constellation Brands, Inc.
Company Guar. Notes
5.25% due 11/15/2048................... 95,000 100,748
--------
Brewery -- 0.2%
Anheuser-Busch Cos. LLC/Anheuser-Busch
InBev Worldwide, Inc.
Company Guar. Notes
4.70% due 02/01/2036*.................. 101,000 100,898
Anheuser-Busch Cos. LLC/Anheuser-Busch
InBev Worldwide, Inc.
Company Guar. Notes
4.90% due 02/01/2046*.................. 104,000 104,456
Anheuser-Busch InBev Worldwide, Inc.
Company Guar. Notes
4.60% due 04/15/2048................... 46,000 44,191
Anheuser-Busch InBev Worldwide, Inc.
Company Guar. Notes
5.55% due 01/23/2049................... 248,000 272,192
--------
521,737
--------
Broadcast Services/Program -- 0.1%
Fox Corp.
Senior Notes
5.48% due 01/25/2039*.................. 74,000 81,830
Fox Corp.
Senior Notes
5.58% due 01/25/2049*.................. 90,000 101,294
Univision Communications, Inc.
Senior Sec. Notes
5.13% due 05/15/2023*.................. 157,000 148,659
--------
331,783
--------
Building & Construction Products-Misc. -- 0.3%
Owens Corning
Senior Notes
4.30% due 07/15/2047................... 142,000 114,895
Standard Industries, Inc.
Senior Notes
6.00% due 10/15/2025*.................. 575,000 602,077
--------
716,972
--------
Building & Construction-Misc. -- 0.3%
Frontdoor, Inc.
Senior Notes
6.75% due 08/15/2026*.................. 419,000 428,428
Principal Value
Security Description Amount(5) (Note 2)
Building & Construction-Misc. (continued)
Weekley Homes LLC/Weekley Finance Corp.
Senior Notes
6.00% due 02/01/2023......................... $400,000 $ 385,000
----------
813,428
----------
Building-Heavy Construction -- 0.4%
Great Lakes Dredge & Dock Corp.
Company Guar. Notes
8.00% due 05/15/2022......................... 430,000 450,425
Tutor Perini Corp.
Company Guar. Notes
6.88% due 05/01/2025*........................ 690,000 687,502
----------
1,137,927
----------
Building-Residential/Commercial -- 0.0%
Toll Brothers Finance Corp.
Company Guar. Notes
4.35% due 02/15/2028......................... 123,000 115,005
----------
Cable/Satellite TV -- 1.3%
Block Communications, Inc.
Senior Notes
6.88% due 02/15/2025*........................ 503,000 521,234
CCO Holdings LLC/CCO Holdings
Capital Corp.
Senior Notes
5.00% due 02/01/2028*........................ 203,000 200,188
CCO Holdings LLC/CCO Holdings
Capital Corp.
Senior Notes
5.38% due 05/01/2025*........................ 300,000 309,750
CCO Holdings LLC/CCO Holdings
Capital Corp.
Senior Notes
5.50% due 05/01/2026*........................ 106,000 109,445
CCO Holdings LLC/CCO Holdings
Capital Corp.
Senior Notes
5.88% due 04/01/2024*........................ 150,000 156,766
Charter Communications Operating LLC/Charter
Communications Operating Capital FRS
Senior Sec. Notes
4.39% (3 ML+1.65%)
due 02/01/2024............................... 160,000 160,001
Charter Communications Operating LLC/Charter
Communications Operating Capital
Senior Sec. Notes
5.05% due 03/30/2029......................... 130,000 136,981
Charter Communications Operating LLC/Charter
Communications Operating Capital
Senior Sec. Notes
5.38% due 04/01/2038......................... 18,000 18,097
Charter Communications Operating LLC/Charter
Communications Operating Capital
Senior Sec. Notes
5.75% due 04/01/2048......................... 50,000 52,229
Charter Communications Operating LLC/Charter
Communications Operating Capital
Senior Sec. Notes
6.38% due 10/23/2035......................... 55,000 61,326
20
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Cable/Satellite TV (continued)
Comcast Corp.
Company Guar. Notes
3.60% due 03/01/2024..................... $ 127,000 $ 130,728
Comcast Corp.
Company Guar. Notes
3.90% due 03/01/2038..................... 43,000 42,252
Comcast Corp.
Company Guar. Notes
4.60% due 10/15/2038..................... 128,000 137,021
Comcast Corp.
Company Guar. Notes
4.70% due 10/15/2048..................... 94,000 101,906
CSC Holdings LLC
Company Guar. Notes
5.50% due 04/15/2027*.................... 1,320,000 1,347,918
----------
3,485,842
----------
Casino Services -- 0.2%
Eldorado Resorts, Inc.
Company Guar. Notes
6.00% due 09/15/2026..................... 435,000 441,525
----------
Cellular Telecom -- 1.0%
Sprint Corp.
Company Guar. Notes
7.88% due 09/15/2023..................... 2,527,000 2,647,033
Sprint Spectrum Co. LLC/Sprint Spectrum
Co. II LLC/Sprint Spectrum Co. III LLC
Senior Sec. Notes
4.74% due 09/20/2029*.................... 213,000 215,396
----------
2,862,429
----------
Chemicals-Diversified -- 0.2%
Dow Chemical Co.
Senior Notes
5.55% due 11/30/2048*.................... 90,000 100,343
DowDuPont, Inc.
Senior Notes
4.73% due 11/15/2028..................... 130,000 140,451
DowDuPont, Inc.
Senior Notes
5.42% due 11/15/2048..................... 118,000 134,602
Eastman Chemical Co.
Senior Notes
1.50% due 05/26/2023..................... EUR 175,000 204,826
----------
580,222
----------
Chemicals-Fibers -- 0.2%
Rayonier AM Products, Inc.
Company Guar. Notes
5.50% due 06/01/2024*.................... 555,000 521,700
----------
Chemicals-Plastics -- 0.1%
Neon Holdings, Inc.
Senior Sec. Notes
10.13% due 04/01/2026*................... 129,000 131,580
----------
Principal Value
Security Description Amount(5) (Note 2)
Chemicals-Specialty -- 0.1%
Lubrizol Corp.
Company Guar. Notes
6.50% due 10/01/2034...................... $ 107,000 $ 140,796
----------
Coal -- 0.2%
SunCoke Energy Partners LP/SunCoke Energy
Partners Finance Corp.
Company Guar. Notes
7.50% due 06/15/2025*..................... 620,000 627,750
----------
Coatings/Paint -- 0.0%
RPM International, Inc.
Senior Notes
4.25% due 01/15/2048...................... 21,000 18,284
----------
Commercial Services -- 0.0%
Ecolab, Inc.
Senior Notes
2.38% due 08/10/2022...................... 119,000 117,453
----------
Commercial Services-Finance -- 0.2%
Refinitiv US Holdings, Inc.
Company Guar. Notes
8.25% due 11/15/2026*..................... 605,000 593,656
----------
Computer Services -- 0.3%
Harland Clarke Holdings Corp.
Senior Sec. Notes
8.38% due 08/15/2022*..................... 70,000 63,119
IBM Credit LLC
Senior Notes
3.00% due 02/06/2023...................... 533,000 537,001
International Business Machines Corp.
Senior Notes
1.75% due 01/31/2031...................... EUR 250,000 292,893
----------
893,013
----------
Computer Software -- 0.2%
Rackspace Hosting, Inc.
Company Guar. Notes
8.63% due 11/15/2024*..................... 475,000 423,168
----------
Computers -- 0.5%
Apple, Inc.
Senior Notes
2.85% due 05/06/2021...................... 101,000 101,665
Diamond 1 Finance Corp./Diamond 2 Finance
Corp.
Senior Sec. Notes
6.02% due 06/15/2026*..................... 1,010,000 1,086,306
Diamond 1 Finance Corp./Diamond 2 Finance
Corp.
Senior Sec. Notes
8.10% due 07/15/2036*..................... 76,000 89,289
Hewlett Packard Enterprise Co.
Senior Notes
6.20% due 10/15/2035...................... 32,000 33,852
----------
1,311,112
----------
21
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Computers-Integrated Systems -- 0.3%
Diebold Nixdorf, Inc.
Company Guar. Notes
8.50% due 04/15/2024...................... $ 522,000 $ 464,580
Everi Payments, Inc.
Company Guar. Notes
7.50% due 12/15/2025*..................... 285,000 296,400
----------
760,980
----------
Consumer Products-Misc. -- 0.2%
Central Garden & Pet Co.
Company Guar. Notes
5.13% due 02/01/2028...................... 475,000 435,813
----------
Containers-Metal/Glass -- 0.4%
Crown Americas LLC/Crown Americas Capital
Corp. IV
Company Guar. Notes
4.50% due 01/15/2023...................... 225,000 227,250
Crown Cork & Seal Co., Inc.
Company Guar. Notes
7.38% due 12/15/2026...................... 374,000 415,140
Owens-Brockway Glass Container, Inc.
Company Guar. Notes
5.38% due 01/15/2025*..................... 426,000 433,455
----------
1,075,845
----------
Containers-Paper/Plastic -- 0.0%
Sealed Air Corp.
Company Guar. Notes
5.13% due 12/01/2024*..................... 76,000 78,733
----------
Cosmetics & Toiletries -- 0.5%
Coty, Inc.
Company Guar. Notes
6.50% due 04/15/2026*..................... 625,000 610,938
First Quality Finance Co., Inc.
Company Guar. Notes
5.00% due 07/01/2025*..................... 548,000 532,946
Procter & Gamble Co.
Senior Notes
1.88% due 10/30/2038...................... EUR 230,000 283,293
----------
1,427,177
----------
Diagnostic Equipment -- 0.2%
Ortho-Clinical Diagnostics, Inc.
Senior Notes
6.63% due 05/15/2022*..................... 482,000 457,418
Thermo Fisher Scientific, Inc.
Senior Notes
2.88% due 07/24/2037...................... EUR 120,000 148,147
----------
605,565
----------
Dialysis Centers -- 0.2%
DaVita HealthCare Partners, Inc.
Company Guar. Notes
5.13% due 07/15/2024...................... 600,000 592,500
----------
Principal Value
Security Description Amount(5) (Note 2)
Distribution/Wholesale -- 0.2%
H&E Equipment Services, Inc.
Company Guar. Notes
5.63% due 09/01/2025.......... $ 420,000 $418,950
--------
Diversified Banking Institutions -- 1.5%
Bank of America Corp.
Senior Notes
0.75% due 07/26/2023.......... EUR 325,000 369,637
Bank of America Corp.
Senior Notes
2.38% due 06/19/2024.......... EUR 300,000 367,608
Bank of America Corp.
Senior Notes
3.55% due 03/05/2024.......... 83,000 84,288
Bank of America Corp.
Senior Notes
3.86% due 07/23/2024.......... 103,000 105,926
Bank of America Corp.
Sub. Notes
4.18% due 11/25/2027.......... 244,000 247,780
Bank of America Corp.
Senior Notes
4.27% due 07/23/2029.......... 71,000 73,927
Citigroup, Inc.
Senior Notes
2.75% due 01/24/2024.......... GBP 100,000 133,753
Citigroup, Inc.
Senior Notes
3.20% due 10/21/2026.......... 122,000 119,491
Citigroup, Inc.
Senior Notes
3.30% due 04/27/2025.......... 53,000 52,871
Citigroup, Inc.
Sub. Notes
4.45% due 09/29/2027.......... 176,000 180,829
Citigroup, Inc.
Senior Notes
4.65% due 07/23/2048.......... 134,000 143,659
Citigroup, Inc.
Sub. Notes
5.88% due 02/22/2033.......... 107,000 122,402
Citigroup, Inc.
Sub. Notes
6.00% due 10/31/2033.......... 50,000 58,432
Goldman Sachs Group, Inc.
Senior Notes
1.25% due 05/01/2025.......... EUR 150,000 170,571
Goldman Sachs Group, Inc.
Senior Notes
2.00% due 11/01/2028.......... EUR 175,000 203,939
Goldman Sachs Group, Inc.
Senior Notes
2.35% due 11/15/2021.......... 196,000 192,976
Goldman Sachs Group, Inc.
Senior Notes
3.63% due 02/20/2024.......... 123,000 124,258
22
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Diversified Banking Institutions (continued)
Goldman Sachs Group, Inc.
Senior Notes
4.02% due 10/31/2038.................. $130,000 $ 124,131
Goldman Sachs Group, Inc.
Sub. Notes
4.25% due 10/21/2025.................. 113,000 115,669
Goldman Sachs Group, Inc.
Sub. Notes
6.75% due 10/01/2037.................. 118,000 143,851
JPMorgan Chase & Co.
Senior Notes
3.21% due 04/01/2023.................. 295,000 296,775
Morgan Stanley
Senior Notes
4.43% due 01/23/2030.................. 106,000 111,642
Morgan Stanley
Sub. Notes
5.00% due 11/24/2025.................. 516,000 553,085
----------
4,097,500
----------
Diversified Manufacturing Operations -- 0.2%
3M Co.
Senior Notes
3.25% due 02/14/2024.................. 79,000 81,396
General Electric Capital Corp.
Sub. Notes
5.30% due 02/11/2021.................. 260,000 269,094
Illinois Tool Works, Inc.
Senior Notes
3.50% due 03/01/2024.................. 87,000 89,900
----------
440,390
----------
E-Commerce/Products -- 0.0%
Amazon.com, Inc.
Senior Notes
4.80% due 12/05/2034.................. 60,000 69,852
----------
Electric-Distribution -- 0.1%
Oglethorpe Power Corp.
1st Mtg. Notes
5.05% due 10/01/2048*................. 209,000 230,348
----------
Electric-Generation -- 0.0%
Basin Electric Power Cooperative
1st Mtg. Notes
4.75% due 04/26/2047*................. 40,000 42,570
----------
Electric-Integrated -- 0.9%
Appalachian Power Co.
Senior Notes
4.50% due 03/01/2049.................. 47,000 48,903
Dominion Resources, Inc.
Senior Notes
5.25% due 08/01/2033.................. 164,000 184,040
DTE Electric Co.
General Refunding Mtg.
3.95% due 03/01/2049.................. 183,000 187,150
Duke Energy Progress LLC
1st Mtg. Notes
2.80% due 05/15/2022.................. 72,000 72,405
Principal Value
Security Description Amount(5) (Note 2)
Electric-Integrated (continued)
Entergy Arkansas LLC
1st Mtg. Notes
4.20% due 04/01/2049............... $ 69,000 $ 71,239
Entergy Texas, Inc.
1st Mtg. Notes
4.50% due 03/30/2039............... 264,000 277,938
FirstEnergy Corp.
Senior Notes
7.38% due 11/15/2031............... 370,000 489,496
FirstEnergy Transmission LLC
Senior Notes
4.55% due 04/01/2049*.............. 66,000 67,288
Georgia Power Co.
Senior Notes
2.00% due 09/08/2020............... 109,000 107,992
Interstate Power & Light Co.
Senior Notes
3.60% due 04/01/2029............... 76,000 76,196
Jersey Central Power & Light Co.
Senior Notes
4.30% due 01/15/2026*.............. 54,000 56,216
Kansas City Power & Light Co.
General Refunding Mtg. Notes
4.13% due 04/01/2049............... 49,000 50,658
Louisville Gas & Electric Co.
1st Mtg. Bonds
4.25% due 04/01/2049............... 146,000 153,665
Public Service Co. of Colorado
1st Mtg. Bonds
3.70% due 06/15/2028............... 148,000 154,094
Public Service Co. of Colorado
1st Mtg. Bonds
4.10% due 06/15/2048............... 88,000 92,624
South Carolina Electric & Gas Co.
1st Mtg. Notes
4.35% due 02/01/2042............... 35,000 37,115
South Carolina Electric & Gas Co.
1st Mtg. Bonds
5.10% due 06/01/2065............... 230,000 264,051
----------
2,391,070
----------
Electronic Components-Semiconductors -- 0.2%
Amkor Technology, Inc.
Senior Notes
6.63% due 09/15/2027*.............. 372,000 377,580
Micron Technology, Inc.
Senior Notes
5.33% due 02/06/2029............... 111,000 113,916
----------
491,496
----------
Electronic Measurement Instruments -- 0.1%
Trimble, Inc.
Senior Notes
4.75% due 12/01/2024............... 12,000 12,327
Trimble, Inc.
Senior Notes
4.90% due 06/15/2028............... 238,000 243,154
----------
255,481
----------
23
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Electronic Parts Distribution -- 0.3%
Arrow Electronics, Inc.
Senior Notes
4.00% due 04/01/2025.................. $ 68,000 $ 67,992
Ingram Micro, Inc.
Senior Notes
5.45% due 12/15/2024.................. 666,000 660,317
----------
728,309
----------
Electronic Security Devices -- 0.2%
ADT Corp.
Senior Sec. Notes
4.13% due 06/15/2023.................. 420,000 405,090
----------
Energy-Alternate Sources -- 0.2%
Pattern Energy Group, Inc.
Company Guar. Notes
5.88% due 02/01/2024*................. 630,000 641,025
----------
Enterprise Software/Service -- 0.3%
Donnelley Financial Solutions, Inc.
Company Guar. Notes
8.25% due 10/15/2024.................. 603,000 607,522
Oracle Corp.
Senior Notes
2.95% due 11/15/2024.................. 204,000 204,370
----------
811,892
----------
Finance-Auto Loans -- 0.1%
Credit Acceptance Corp.
Company Guar. Notes
6.63% due 03/15/2026*................. 348,000 353,777
----------
Finance-Consumer Loans -- 0.9%
Enova International, Inc.
Company Guar. Notes
8.50% due 09/01/2024*................. 638,000 599,720
Enova International, Inc.
Company Guar. Notes
8.50% due 09/15/2025*................. 351,000 326,869
SLM Corp.
Senior Notes
5.63% due 08/01/2033.................. 836,000 639,540
Springleaf Finance Corp.
Company Guar. Notes
6.88% due 03/15/2025.................. 650,000 670,312
Springleaf Finance Corp.
Company Guar. Notes
7.13% due 03/15/2026.................. 183,000 186,316
Synchrony Financial
Senior Notes
4.25% due 08/15/2024.................. 94,000 94,567
Synchrony Financial
Senior Notes
4.38% due 03/19/2024.................. 68,000 68,877
----------
2,586,201
----------
Finance-Credit Card -- 0.2%
Alliance Data Systems Corp.
Company Guar. Notes
5.88% due 11/01/2021*................. 400,000 409,000
Principal Value
Security Description Amount(5) (Note 2)
Finance-Credit Card (continued)
American Express Co.
Senior Notes
3.40% due 02/22/2024................................ $190,000 $193,058
American Express Co.
Senior Notes
4.20% due 11/06/2025................................ 64,000 67,679
--------
669,737
--------
Finance-Investment Banker/Broker -- 0.2%
Jefferies Group LLC/Jefferies Group Capital
Finance, Inc.
Senior Notes
4.15% due 01/23/2030................................ 103,000 94,300
Lehman Brothers Holdings, Inc.
Escrow Notes
6.75% due 12/28/2017+(4)............................ 280,000 28
Lehman Brothers Holdings, Inc.
Escrow Notes
7.50% due 05/11/2038+(4)............................ 361,000 36
LPL Holdings, Inc.
Company Guar. Notes
5.75% due 09/15/2025*............................... 565,000 572,232
--------
666,596
--------
Finance-Mortgage Loan/Banker -- 0.2%
Quicken Loans, Inc.
Company Guar. Notes
5.75% due 05/01/2025*............................... 650,000 652,275
--------
Finance-Other Services -- 0.1%
National Rural Utilities Cooperative Finance Corp.
Senior Notes
2.30% due 09/15/2022................................ 140,000 137,881
National Rural Utilities Cooperative Finance Corp.
Collateral Trust Notes
2.40% due 04/25/2022................................ 84,000 83,416
--------
221,297
--------
Food-Meat Products -- 0.1%
Smithfield Foods, Inc.
Senior Notes
2.65% due 10/03/2021*............................... 78,000 74,991
Smithfield Foods, Inc.
Senior Notes
5.20% due 04/01/2029*............................... 38,000 38,193
Tyson Foods, Inc.
Senior Notes
5.10% due 09/28/2048................................ 108,000 109,919
--------
223,103
--------
Food-Misc./Diversified -- 0.4%
Conagra Brands, Inc.
Senior Notes
5.40% due 11/01/2048................................ 115,000 115,626
Conagra Brands, Inc.
Senior Notes
7.00% due 10/01/2028................................ 104,000 121,592
24
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Food-Misc./Diversified (continued)
General Mills, Inc.
Senior Notes
4.70% due 04/17/2048....................... $121,000 $ 120,815
Kraft Heinz Foods Co.
Sec. Notes
4.88% due 02/15/2025*...................... 174,000 177,910
Mars, Inc.
Company Guar. Notes
4.20% due 04/01/2059*...................... 68,000 69,707
Mondelez International, Inc.
Senior Notes
3.63% due 02/13/2026....................... 124,000 125,683
Nestle Holdings, Inc.
Company Guar. Notes
3.50% due 09/24/2025*...................... 152,000 157,605
Post Holdings, Inc.
Company Guar. Notes
5.50% due 03/01/2025*...................... 330,000 333,713
----------
1,222,651
----------
Food-Retail -- 0.2%
Albertsons Cos. LLC/Safeway, Inc./New
Albertsons LP/Albertson's LLC
Company Guar. Notes
5.75% due 03/15/2025....................... 416,000 394,680
Kroger Co.
Senior Notes
5.40% due 01/15/2049....................... 77,000 79,787
----------
474,467
----------
Gambling (Non-Hotel) -- 0.2%
Scientific Games International, Inc.
Company Guar. Notes
8.25% due 03/15/2026*...................... 405,000 413,363
Waterford Gaming LLC/Waterford Gaming
Financial Corp.
Escrow Notes
8.63% due 09/15/2014*+(4).................. 478,062 26,389
----------
439,752
----------
Gas-Distribution -- 0.0%
NiSource, Inc.
Senior Notes
5.65% due 02/01/2045....................... 61,000 70,879
----------
Hotels/Motels -- 0.3%
Hilton Grand Vacations Borrower LLC/Hilton
Grand Vacations Borrower, Inc.
Company Guar. Notes
6.13% due 12/01/2024....................... 247,000 256,263
Wyndham Worldwide Corp.
Senior Sec. Notes
5.40% due 04/01/2024....................... 136,000 138,040
Wyndham Worldwide Corp.
Senior Sec. Notes
5.75% due 04/01/2027....................... 436,000 432,468
----------
826,771
----------
Principal Value
Security Description Amount(5) (Note 2)
Industrial Automated/Robotic -- 0.0%
Rockwell Automation, Inc.
Senior Notes
4.20% due 03/01/2049............... $ 47,000 $ 49,618
--------
Insurance Brokers -- 0.0%
Marsh & McLennan Cos., Inc.
Senior Notes
3.50% due 12/29/2020............... 54,000 54,718
Willis North America, Inc.
Company Guar. Notes
5.05% due 09/15/2048............... 69,000 71,796
--------
126,514
--------
Insurance-Life/Health -- 0.0%
Brighthouse Financial, Inc.
Senior Notes
4.70% due 06/22/2047............... 85,000 67,758
--------
Insurance-Multi-line -- 0.0%
Assurant, Inc.
Senior Notes
6.75% due 02/15/2034............... 77,000 88,685
--------
Insurance-Property/Casualty -- 0.3%
ACE INA Holdings, Inc.
Company Guar. Notes
2.88% due 11/03/2022............... 75,000 75,599
AmWINS Group, Inc.
Company Guar. Notes
7.75% due 07/01/2026*.............. 470,000 468,825
Chubb INA Holdings, Inc.
Company Guar. Notes
2.50% due 03/15/2038............... EUR 150,000 179,101
--------
723,525
--------
Internet Connectivity Services -- 0.2%
Cogent Communications Group, Inc.
Senior Sec. Notes
5.38% due 03/01/2022*.............. 407,000 416,158
--------
Internet Content-Entertainment -- 0.2%
Netflix, Inc.
Senior Notes
4.38% due 11/15/2026............... 122,000 119,713
Netflix, Inc.
Senior Notes
5.88% due 02/15/2025............... 476,000 514,389
--------
634,102
--------
Investment Companies -- 0.2%
FS Energy & Power Fund
Senior Sec. Notes
7.50% due 08/15/2023*.............. 462,000 473,839
--------
Investment Management/Advisor Services -- 0.0%
Ameriprise Financial, Inc.
Senior Notes
3.00% due 03/22/2022............... 99,000 99,569
--------
25
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Machinery-Construction & Mining -- 0.2%
Caterpillar Financial Services Corp.
Senior Notes
2.55% due 11/29/2022.................. $ 78,000 $ 77,614
Caterpillar Financial Services Corp.
Senior Notes
3.15% due 09/07/2021.................. 59,000 59,680
Caterpillar Financial Services Corp.
Senior Notes
3.45% due 05/15/2023.................. 98,000 100,737
Terex Corp.
Company Guar. Notes
5.63% due 02/01/2025*................. 429,000 426,855
----------
664,886
----------
Machinery-Electrical -- 0.0%
ABB Finance USA, Inc.
Company Guar. Notes
3.38% due 04/03/2023.................. 125,000 127,011
----------
Machinery-Farming -- 0.2%
CNH Industrial Capital LLC
Company Guar. Notes
4.20% due 01/15/2024.................. 208,000 213,474
John Deere Capital Corp.
Senior Notes
2.95% due 04/01/2022.................. 182,000 183,651
John Deere Capital Corp.
Senior Notes
3.45% due 01/10/2024.................. 108,000 110,992
John Deere Capital Corp.
Senior Notes
3.65% due 10/12/2023.................. 60,000 62,232
----------
570,349
----------
Machinery-General Industrial -- 0.1%
Roper Technologies, Inc.
Senior Notes
4.20% due 09/15/2028.................. 210,000 217,674
----------
Medical Labs & Testing Services -- 0.4%
Laboratory Corp. of America Holdings
Senior Notes
3.25% due 09/01/2024.................. 216,000 213,699
Laboratory Corp. of America Holdings
Senior Notes
4.70% due 02/01/2045.................. 96,000 93,566
MEDNAX, Inc.
Company Guar. Notes
5.25% due 12/01/2023*................. 770,000 779,625
----------
1,086,890
----------
Medical Products -- 0.1%
Baxter International, Inc.
Senior Notes
3.50% due 08/15/2046.................. 78,000 67,406
Hologic, Inc.
Company Guar. Notes
4.38% due 10/15/2025*................. 325,000 323,310
----------
390,716
----------
Principal Value
Security Description Amount(5) (Note 2)
Medical-Biomedical/Gene -- 0.1%
Celgene Corp.
Senior Notes
3.63% due 05/15/2024........... $119,000 $120,820
Celgene Corp.
Senior Notes
4.55% due 02/20/2048........... 10,000 10,146
Celgene Corp.
Senior Notes
4.63% due 05/15/2044........... 68,000 68,470
--------
199,436
--------
Medical-Drugs -- 0.1%
AbbVie, Inc.
Senior Notes
4.45% due 05/14/2046........... 67,000 62,124
AbbVie, Inc.
Senior Notes
4.88% due 11/14/2048........... 63,000 61,963
GlaxoSmithKline Capital, Inc.
Company Guar. Notes
3.38% due 05/15/2023........... 74,000 75,690
--------
199,777
--------
Medical-Generic Drugs -- 0.2%
Mylan, Inc.
Company Guar. Notes
4.55% due 04/15/2028........... 95,000 92,359
Par Pharmaceutical, Inc.
Senior Sec. Notes
7.50% due 04/01/2027*.......... 396,000 401,544
--------
493,903
--------
Medical-HMO -- 0.2%
Centene Corp.
Senior Notes
4.75% due 01/15/2025........... 141,000 143,820
UnitedHealth Group, Inc.
Senior Bonds
2.38% due 10/15/2022........... 302,000 298,866
UnitedHealth Group, Inc.
Senior Notes
3.75% due 07/15/2025........... 107,000 111,690
--------
554,376
--------
Medical-Hospitals -- 0.3%
HCA, Inc.
Senior Sec. Notes
5.25% due 06/15/2026........... 76,000 81,432
HCA, Inc.
Company Guar. Notes
5.38% due 02/01/2025........... 800,000 848,000
--------
929,432
--------
Medical-Wholesale Drug Distribution -- 0.1%
Allergan Sales LLC
Company Guar. Notes
4.88% due 02/15/2021*.......... 67,000 68,930
26
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Medical-Wholesale Drug Distribution (continued)
Cardinal Health, Inc.
Senior Notes
4.60% due 03/15/2043.................. $ 190,000 $175,106
--------
244,036
--------
Metal Processors & Fabrication -- 0.2%
Novelis Corp.
Company Guar. Notes
5.88% due 09/30/2026*................. 300,000 298,875
Novelis Corp.
Company Guar. Notes
6.25% due 08/15/2024*................. 196,000 200,410
--------
499,285
--------
Metal-Copper -- 0.2%
Freeport-McMoRan Copper & Gold, Inc.
Company Guar. Notes
3.88% due 03/15/2023.................. 425,000 418,884
--------
Metal-Diversified -- 0.1%
Glencore Funding LLC
Company Guar. Notes
4.13% due 03/12/2024*................. 134,000 135,296
--------
Metal-Iron -- 0.2%
Cleveland-Cliffs, Inc.
Company Guar. Notes
5.75% due 03/01/2025.................. 517,000 495,028
--------
Multimedia -- 0.2%
E.W. Scripps Co.
Company Guar. Notes
5.13% due 05/15/2025*................. 444,000 422,910
Time Warner, Inc.
Company Guar. Notes
4.85% due 07/15/2045.................. 38,000 38,356
Warner Media LLC
Company Guar. Notes
1.95% due 09/15/2023.................. EUR 160,000 188,450
--------
649,716
--------
Networking Products -- 0.0%
Cisco Systems, Inc.
Senior Notes
2.20% due 02/28/2021.................. 92,000 91,391
--------
Office Supplies & Forms -- 0.0%
Avery Dennison Corp.
Senior Notes
4.88% due 12/06/2028.................. 72,000 77,070
--------
Oil Companies-Exploration & Production -- 1.6%
Anadarko Petroleum Corp.
Senior Notes
6.45% due 09/15/2036.................. 114,000 131,164
Callon Petroleum Co.
Company Guar. Notes
6.38% due 07/01/2026.................. 425,000 426,062
Centennial Resource Production LLC
Company Guar. Notes
6.88% due 04/01/2027*................. 237,000 239,323
Principal Value
Security Description Amount(5) (Note 2)
Oil Companies-Exploration & Production (continued)
Chaparral Energy, Inc.
Senior Notes
8.75% due 07/15/2023*.................... $704,000 $ 482,240
Cimarex Energy Co.
Senior Notes
4.38% due 03/15/2029..................... 66,000 67,922
Continental Resources, Inc.
Company Guar. Notes
4.50% due 04/15/2023..................... 93,000 96,272
Extraction Oil & Gas, Inc.
Company Guar. Notes
5.63% due 02/01/2026*.................... 550,000 422,125
Hilcorp Energy I LP/Hilcorp Finance Co.
Senior Notes
5.00% due 12/01/2024*.................... 702,000 682,906
Lonestar Resources America, Inc.
Company Guar. Notes
11.25% due 01/01/2023*................... 521,000 505,370
Marathon Oil Corp.
Senior Notes
6.60% due 10/01/2037..................... 52,000 61,246
Noble Energy, Inc.
Senior Notes
4.95% due 08/15/2047..................... 165,000 162,958
Southwestern Energy Co.
Company Guar. Notes
7.50% due 04/01/2026..................... 450,000 459,000
WildHorse Resource Development Corp.
Company Guar. Notes
6.88% due 02/01/2025..................... 565,000 567,825
----------
4,304,413
----------
Oil Companies-Integrated -- 0.0%
Chevron Corp.
Senior Notes
2.90% due 03/03/2024..................... 119,000 120,361
----------
Oil Field Machinery & Equipment -- 0.3%
Forum Energy Technologies, Inc.
Company Guar. Notes
6.25% due 10/01/2021..................... 335,000 296,475
Hi-Crush Partners LP
Senior Notes
9.50% due 08/01/2026*.................... 750,000 577,500
----------
873,975
----------
Oil Refining & Marketing -- 0.0%
Valero Energy Corp.
Senior Notes
4.00% due 04/01/2029..................... 103,000 103,940
----------
Oil-Field Services -- 0.7%
Apergy Corp.
Company Guar. Notes
6.38% due 05/01/2026..................... 325,000 329,062
Calfrac Holdings LP
Senior Notes
8.50% due 06/15/2026*.................... 605,000 468,875
27
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Oil-Field Services (continued)
Nine Energy Service, Inc.
Senior Notes
8.75% due 11/01/2023*......................... $240,000 $ 247,800
Pioneer Energy Services Corp.
Company Guar. Notes
6.13% due 03/15/2022.......................... 390,000 241,800
Schlumberger Holdings Corp.
Senior Notes
3.75% due 05/01/2024*......................... 101,000 103,208
USA Compression Partners LP/USA Compression
Finance Corp.
Company Guar. Notes
6.88% due 04/01/2026.......................... 375,000 384,844
USA Compression Partners LP/USA Compression
Finance Corp.
Senior Notes
6.88% due 09/01/2027*......................... 101,000 102,641
----------
1,878,230
----------
Paper & Related Products -- 0.2%
Domtar Corp.
Company Guar. Notes
6.75% due 02/15/2044.......................... 235,000 242,900
Georgia-Pacific LLC
Senior Notes
3.73% due 07/15/2023*......................... 110,000 112,865
Georgia-Pacific LLC
Company Guar. Notes
5.40% due 11/01/2020*......................... 111,000 115,386
----------
471,151
----------
Petrochemicals -- 0.0%
Chevron Phillips Chemical Co. LLC/Chevron
Phillips Chemical Co. LP
Senior Notes
3.30% due 05/01/2023*......................... 67,000 67,728
----------
Pharmacy Services -- 0.2%
Cigna Corp.
Company Guar. Notes
4.80% due 08/15/2038*......................... 100,000 102,779
Cigna Corp.
Company Guar. Notes
4.90% due 12/15/2048*......................... 98,000 101,126
CVS Health Corp.
Senior Notes
4.78% due 03/25/2038.......................... 451,000 446,622
----------
650,527
----------
Pipelines -- 1.8%
Antero Midstream Partners LP/Antero Midstream
Finance Corp.
Senior Notes
5.75% due 03/01/2027*......................... 198,000 200,970
Buckeye Partners LP
Senior Notes
3.95% due 12/01/2026.......................... 127,000 120,747
Principal Value
Security Description Amount(5) (Note 2)
Pipelines (continued)
Cheniere Corpus Christi Holdings LLC
Senior Sec. Notes
7.00% due 06/30/2024........................... $ 640,000 $722,432
Cheniere Energy Partners LP
Senior Sec. Notes
5.25% due 10/01/2025........................... 235,000 240,287
Colorado Interstate Gas Co. LLC/Colorado
Interstate Issuing Corp.
Company Guar. Notes
4.15% due 08/15/2026*.......................... 98,000 99,651
Enable Midstream Partners LP
Senior Notes
4.95% due 05/15/2028........................... 75,000 75,938
Energy Transfer Operating LP
Company Guar. Notes
4.25% due 03/15/2023........................... 58,000 59,506
Energy Transfer Operating LP
Company Guar. Notes
4.50% due 04/15/2024........................... 81,000 84,454
Energy Transfer Operating LP
Company Guar. Notes
5.25% due 04/15/2029........................... 89,000 95,438
Energy Transfer Operating LP
Company Guar. Notes
6.25% due 04/15/2049........................... 67,000 75,046
Energy Transfer Partners LP
Company Guar. Notes
4.90% due 03/15/2035........................... 63,000 59,866
EnLink Midstream Partners LP
Senior Notes
5.05% due 04/01/2045........................... 20,000 17,250
Enterprise Products Operating LLC
Company Guar. Notes
4.80% due 02/01/2049........................... 89,000 94,672
Genesis Energy LP/Genesis Energy Finance Corp.
Company Guar. Notes
6.00% due 05/15/2023........................... 532,000 535,990
Holly Energy Partners LP/Holly Energy Finance
Corp.
Company Guar. Notes
6.00% due 08/01/2024*.......................... 395,000 407,640
Kinder Morgan Energy Partners LP
Company Guar. Notes
6.95% due 01/15/2038........................... 110,000 134,312
Kinder Morgan, Inc.
Company Guar. Notes
1.50% due 03/16/2022........................... EUR 275,000 320,201
Magellan Midstream Partners LP
Senior Notes
4.85% due 02/01/2049........................... 76,000 80,662
MPLX LP
Senior Notes
4.00% due 03/15/2028........................... 111,000 110,310
MPLX LP
Senior Notes
4.13% due 03/01/2027........................... 48,000 48,302
28
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Pipelines (continued)
MPLX LP
Senior Notes
5.50% due 02/15/2049.......................... $ 150,000 $ 159,999
SemGroup Corp./Rose Rock Finance Corp.
Company Guar. Notes
5.63% due 07/15/2022.......................... 706,000 698,057
Summit Midstream Holdings LLC/Summit
Midstream Finance Corp.
Company Guar. Notes
5.50% due 08/15/2022.......................... 467,000 462,330
Williams Cos., Inc.
Senior Notes
5.75% due 06/24/2044.......................... 120,000 131,991
----------
5,036,051
----------
Platinum -- 0.1%
Stillwater Mining Co.
Company Guar. Notes
7.13% due 06/27/2025.......................... 200,000 195,260
----------
Poultry -- 0.3%
Pilgrim's Pride Corp.
Company Guar. Notes
5.88% due 09/30/2027*......................... 685,000 690,138
----------
Publishing-Books -- 0.2%
McGraw-Hill Global Education Holdings LLC/
McGraw-Hill Global Education Finance
Senior Notes
7.88% due 05/15/2024*......................... 515,000 412,000
----------
Radio -- 0.2%
Sirius XM Radio, Inc.
Company Guar. Notes
5.38% due 07/15/2026*......................... 488,000 498,516
----------
Real Estate Investment Trusts -- 1.8%
American Tower Corp.
Senior Notes
1.95% due 05/22/2026.......................... EUR 130,000 150,086
American Tower Corp.
Senior Notes
4.00% due 06/01/2025.......................... 87,000 89,556
Columbia Property Trust Operating Partnership
LP
Company Guar. Notes
4.15% due 04/01/2025.......................... 106,000 106,034
Crown Castle International Corp.
Senior Notes
5.20% due 02/15/2049.......................... 95,000 99,965
CTR Partnership LP/CareTrust Capital Corp.
Company Guar. Notes
5.25% due 06/01/2025.......................... 426,000 427,615
ERP Operating LP
Senior Notes
4.15% due 12/01/2028.......................... 56,000 59,712
ESH Hospitality, Inc.
Company Guar. Notes
5.25% due 05/01/2025*......................... 710,000 705,264
Principal Value
Security Description Amount(5) (Note 2)
Real Estate Investment Trusts (continued)
GEO Group, Inc.
Company Guar. Notes
5.13% due 04/01/2023........................ $350,000 $ 310,625
GEO Group, Inc.
Company Guar. Notes
5.88% due 10/15/2024........................ 310,000 271,250
GLP Capital LP/GLP Financing II, Inc.
Company Guar. Notes
5.38% due 04/15/2026........................ 340,000 355,266
Iron Mountain, Inc.
Company Guar. Notes
4.88% due 09/15/2027*....................... 435,000 417,600
iStar, Inc.
Senior Notes
5.25% due 09/15/2022........................ 427,000 418,994
MGM Growth Properties Operating Partnership
LP/MGP Finance Co-Issuer, Inc.
Company Guar. Notes
5.75% due 02/01/2027*....................... 179,000 185,265
MPT Operating Partnership LP/MPT Finance
Corp.
Company Guar. Notes
5.00% due 10/15/2027........................ 506,000 514,855
Sabra Health Care LP
Company Guar. Notes
5.13% due 08/15/2026........................ 550,000 538,402
Simon Property Group LP
Senior Notes
4.13% due 12/01/2021........................ 122,000 126,195
Starwood Property Trust, Inc.
Senior Notes
4.75% due 03/15/2025........................ 310,000 308,450
----------
5,085,134
----------
Real Estate Management/Services -- 0.3%
Newmark Group, Inc.
Senior Notes
6.13% due 11/15/2023........................ 405,000 417,374
Realogy Group LLC/Realogy Co-Issuer Corp.
Company Guar. Notes
4.88% due 06/01/2023*....................... 514,000 479,305
----------
896,679
----------
Real Estate Operations & Development -- 0.4%
Greystar Real Estate Partners LLC
Senior Sec. Notes
5.75% due 12/01/2025*....................... 450,000 451,125
Kennedy-Wilson, Inc.
Company Guar. Notes
5.88% due 04/01/2024........................ 700,000 695,625
----------
1,146,750
----------
Rental Auto/Equipment -- 0.4%
Ahern Rentals, Inc.
Sec. Notes
7.38% due 05/15/2023*....................... 465,000 428,381
29
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Rental Auto/Equipment (continued)
Jurassic Holdings III, Inc.
Sec. Notes
6.88% due 02/15/2021*........... $575,000 $ 543,375
----------
971,756
----------
Retail-Appliances -- 0.2%
Conn's, Inc.
Company Guar. Notes
7.25% due 07/15/2022............ 588,000 576,240
----------
Retail-Automobile -- 0.2%
AutoNation, Inc.
Company Guar. Notes
3.50% due 11/15/2024............ 123,000 119,289
Lithia Motors, Inc.
Company Guar. Notes
5.25% due 08/01/2025*........... 454,000 456,270
----------
575,559
----------
Retail-Drug Store -- 0.0%
Walgreens Boots Alliance, Inc.
Senior Notes
4.80% due 11/18/2044............ 54,000 51,753
----------
Retail-Mail Order -- 0.1%
QVC, Inc.
Senior Sec. Notes
4.85% due 04/01/2024............ 205,000 209,604
----------
Retail-Office Supplies -- 0.1%
Staples, Inc.
Company Guar. Notes
8.50% due 09/15/2025*........... 291,000 317,554
----------
Retail-Pawn Shops -- 0.2%
FirstCash, Inc.
Company Guar. Notes
5.38% due 06/01/2024*........... 470,000 480,580
----------
Retail-Restaurants -- 0.4%
Brinker International, Inc.
Company Guar. Notes
5.00% due 10/01/2024*........... 420,000 411,609
Darden Restaurants, Inc.
Senior Notes
4.55% due 02/15/2048............ 119,000 114,198
Golden Nugget, Inc.
Company Guar. Notes
8.75% due 10/01/2025*........... 389,000 408,450
McDonald's Corp.
Senior Notes
4.45% due 09/01/2048............ 157,000 161,139
----------
1,095,396
----------
Rubber/Plastic Products -- 0.0%
Venture Holdings Co. LLC
Company Guar. Notes
11.00% due 06/01/2007+(4)(6)(7). 100,000 0
----------
Principal Value
Security Description Amount(5) (Note 2)
Satellite Telecom -- 0.2%
Hughes Satellite Systems Corp.
Company Guar. Notes
6.63% due 08/01/2026....................... $ 414,000 $ 405,720
----------
Savings & Loans/Thrifts -- 0.2%
First Niagara Financial Group, Inc.
Sub. Notes
7.25% due 12/15/2021....................... 434,000 479,396
New York Community Bancorp, Inc.
Sub. Notes
5.90% due 11/06/2028....................... 193,000 193,431
----------
672,827
----------
Security Services -- 0.2%
Prime Security Services Borrower LLC/Prime
Finance, Inc.
Senior Sec. Notes
5.25% due 04/15/2024*...................... 98,000 98,000
Prime Security Services Borrower LLC/Prime
Finance, Inc.
Senior Sec. Notes
5.75% due 04/15/2026*...................... 334,000 334,070
----------
432,070
----------
Semiconductor Equipment -- 0.1%
Entegris, Inc.
Company Guar. Notes
4.63% due 02/10/2026*...................... 270,000 267,300
----------
Steel-Producers -- 0.3%
Commercial Metals Co.
Senior Notes
5.75% due 04/15/2026....................... 505,000 503,738
United States Steel Corp.
Senior Notes
6.88% due 08/15/2025....................... 336,000 326,760
----------
830,498
----------
Telecommunication Equipment -- 0.1%
Anixter, Inc.
Company Guar. Notes
6.00% due 12/01/2025*...................... 296,000 310,800
----------
Telephone-Integrated -- 1.0%
AT&T, Inc.
Senior Notes
3.15% due 09/04/2036....................... EUR 165,000 195,550
AT&T, Inc.
Senior Notes
4.50% due 05/15/2035....................... 442,000 435,464
AT&T, Inc.
Senior Notes
4.90% due 08/15/2037....................... 61,000 61,664
CenturyLink, Inc.
Senior Notes
7.50% due 04/01/2024....................... 950,000 1,004,625
Frontier Communications Corp.
Senior Notes
7.13% due 01/15/2023....................... 600,000 363,000
30
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Telephone-Integrated (continued)
Frontier Communications Corp.
Senior Notes
7.63% due 04/15/2024.............. $745,000 $ 407,887
Verizon Communications, Inc.
Senior Bonds
2.88% due 01/15/2038.............. 100,000 123,466
Verizon Communications, Inc.
Senior Notes
4.40% due 11/01/2034.............. 104,000 108,191
Verizon Communications, Inc.
Senior Notes
5.25% due 03/16/2037.............. 141,000 158,616
----------
2,858,463
----------
Television -- 0.4%
Belo Corp.
Company Guar. Notes
7.75% due 06/01/2027.............. 497,000 542,972
CBS Corp.
Company Guar. Notes
3.70% due 08/15/2024.............. 86,000 87,417
Gray Television, Inc.
Company Guar. Notes
5.13% due 10/15/2024*............. 290,000 291,175
Gray Television, Inc.
Company Guar. Notes
5.88% due 07/15/2026*............. 111,000 112,965
----------
1,034,529
----------
Tools-Hand Held -- 0.0%
Stanley Black & Decker, Inc.
Senior Notes
3.40% due 03/01/2026.............. 122,000 123,490
----------
Transport-Equipment & Leasing -- 0.1%
GATX Corp.
Senior Notes
4.35% due 02/15/2024.............. 148,000 153,417
GATX Corp.
Senior Notes
4.70% due 04/01/2029.............. 48,000 50,006
----------
203,423
----------
Transport-Marine -- 0.1%
Kirby Corp.
Senior Notes
4.20% due 03/01/2028.............. 142,000 143,226
----------
Transport-Rail -- 0.0%
Kansas City Southern
Company Guar. Notes
4.70% due 05/01/2048.............. 52,000 54,378
----------
Transport-Truck -- 0.0%
JB Hunt Transport Services, Inc.
Company Guar. Notes
3.88% due 03/01/2026.............. 123,000 124,886
----------
Principal Value
Security Description Amount(5) (Note 2)
Trucking/Leasing -- 0.1%
Penske Truck Leasing Co. LP/PTL Finance
Corp.
Senior Notes
3.40% due 11/15/2026*................... $ 95,000 $ 90,919
Penske Truck Leasing Co. LP/PTL Finance
Corp.
Senior Notes
3.95% due 03/10/2025*................... 195,000 195,916
-----------
286,835
-----------
Total U.S. Corporate Bonds & Notes
(cost $94,546,884)...................... 93,291,664
-----------
FOREIGN CORPORATE BONDS & NOTES -- 13.5%
Agricultural Chemicals -- 0.4%
Consolidated Energy Finance SA
Senior Notes
6.88% due 06/15/2025*................... 480,000 483,600
Nutrien, Ltd.
Senior Notes
4.20% due 04/01/2029.................... 55,000 56,635
Nutrien, Ltd.
Senior Notes
5.00% due 04/01/2049.................... 82,000 85,702
OCI NV
Senior Sec. Notes
6.63% due 04/15/2023*................... 410,000 425,170
-----------
1,051,107
-----------
Airport Development/Maintenance -- 0.2%
Heathrow Funding, Ltd.
Senior Sec. Notes
6.75% due 12/03/2028.................... GBP 100,000 172,125
Mexico City Airport Trust
Senior Sec. Notes
4.25% due 10/31/2026.................... 460,000 442,290
-----------
614,415
-----------
Auto/Truck Parts & Equipment-Original -- 0.2%
Aptiv PLC
Company Guar. Notes
5.40% due 03/15/2049.................... 50,000 51,587
Delphi Jersey Holdings PLC
Company Guar. Notes
5.00% due 10/01/2025*................... 595,000 523,897
-----------
575,484
-----------
Banks-Commercial -- 1.1%
AIB Group PLC
Senior Notes
4.75% due 10/12/2023*................... 203,000 209,633
Banco Bilbao Vizcaya Argentaria SA
Senior Notes
1.38% due 05/14/2025.................... EUR 200,000 226,849
Banco de Credito e Inversiones SA
Senior Notes
3.50% due 10/12/2027.................... 490,000 477,995
31
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
FOREIGN CORPORATE BONDS & NOTES (continued)
Banks-Commercial (continued)
Banco do Brasil SA
Senior Notes
4.75% due 03/20/2024*............ $ 370,000 $ 371,295
BPCE SA
Sub. Notes
4.63% due 07/18/2023............. EUR 300,000 388,505
Credit Suisse AG
Sub. Notes
5.75% due 09/18/2025............. EUR 330,000 396,645
Danske Bank A/S
Senior Notes
0.88% due 05/22/2023............. EUR 300,000 328,970
Danske Bank A/S
Senior Notes
3.88% due 09/12/2023*............ 200,000 196,464
Intesa Sanpaolo SpA
Sub. Notes
5.71% due 01/15/2026*............ 255,000 248,921
Malayan Banking Bhd
Sub. Notes
3.91% due 10/29/2026............. 200,000 200,366
----------
3,045,643
----------
Banks-Export/Import -- 0.2%
Export-Import Bank of India
Senior Notes
3.38% due 08/05/2026............. 450,000 432,988
----------
Banks-Special Purpose -- 0.1%
Kreditanstalt fuer Wiederaufbau
Government Guar. Notes
1.63% due 03/15/2021............. 201,000 198,106
----------
Building Societies -- 0.2%
Nationwide Building Society
Senior Notes
1.50% due 03/08/2026............. EUR 200,000 224,232
Nationwide Building Society
Sub. Notes
4.13% due 10/18/2032*............ 250,000 232,726
----------
456,958
----------
Building-Residential/Commercial -- 0.0%
Mattamy Group Corp.
Senior Notes
6.50% due 10/01/2025*............ 39,000 38,280
----------
Cable/Satellite TV -- 0.8%
Altice Financing SA
Senior Sec. Notes
7.50% due 05/15/2026*............ 675,000 666,225
Altice Luxembourg SA
Company Guar. Notes
7.63% due 02/15/2025*............ 965,000 846,788
Sky, Ltd.
Company Guar. Notes
2.50% due 09/15/2026............. EUR 200,000 250,530
Principal Value
Security Description Amount(5) (Note 2)
Cable/Satellite TV (continued)
UPCB Finance IV, Ltd.
Senior Sec. Notes
5.38% due 01/15/2025*......................... $ 444,000 $ 450,660
----------
2,214,203
----------
Cellular Telecom -- 0.6%
Altice France SA
Senior Sec. Notes
8.13% due 02/01/2027*......................... 213,000 215,396
C&W Senior Financing Designated Activity Co.
Senior Notes
6.88% due 09/15/2027*......................... 467,000 468,168
Millicom International Cellular SA
Senior Notes
6.00% due 03/15/2025.......................... 200,000 205,000
Millicom International Cellular SA
Senior Notes
6.63% due 10/15/2026*......................... 200,000 210,000
Numericable-SFR SA
Senior Sec. Notes
7.38% due 05/01/2026*......................... 600,000 588,000
Vodafone Group PLC
Senior Notes
5.25% due 05/30/2048.......................... 90,000 89,224
----------
1,775,788
----------
Chemicals-Diversified -- 0.6%
Braskem Netherlands Finance BV
Company Guar. Notes
4.50% due 01/10/2028*......................... 209,000 203,200
CNAC HK Finbridge Co., Ltd.
Company Guar. Notes
5.13% due 03/14/2028.......................... 225,000 242,099
NOVA Chemicals Corp.
Senior Notes
5.00% due 05/01/2025*......................... 495,000 485,100
Petkim Petrokimya Holding AS
Senior Notes
5.88% due 01/26/2023*......................... 270,000 245,927
Solvay SA
Senior Notes
1.63% due 12/02/2022.......................... EUR 300,000 353,236
Trinseo Materials Operating SCA/Trinseo
Materials Finance, Inc.
Company Guar. Notes
5.38% due 09/01/2025*......................... 178,000 168,655
----------
1,698,217
----------
Computers-Memory Devices -- 0.2%
Seagate HDD Cayman
Company Guar. Notes
4.75% due 01/01/2025.......................... 445,000 432,350
----------
Consumer Products-Misc. -- 0.1%
Controladora Mabe SA de CV
Company Guar. Notes
5.60% due 10/23/2028.......................... 240,000 243,600
----------
32
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
FOREIGN CORPORATE BONDS & NOTES (continued)
Containers-Paper/Plastic -- 0.2%
Intertape Polymer Group, Inc.
Senior Notes
7.00% due 10/15/2026*................. $ 479,000 $490,975
--------
Diamonds/Precious Stones -- 0.1%
Petra Diamonds US Treasury PLC
Sec. Notes
7.25% due 05/01/2022.................. 260,000 243,100
--------
Diversified Banking Institutions -- 1.6%
BNP Paribas SA
Senior Notes
3.38% due 01/23/2026.................. GBP 100,000 136,025
BNP Paribas SA
Senior Notes
4.71% due 01/10/2025*................. 200,000 207,446
Credit Suisse Group AG
Senior Notes
1.25% due 07/17/2025.................. EUR 200,000 227,067
HSBC Holdings PLC
Senior Notes
3.00% due 07/22/2028.................. GBP 120,000 160,455
HSBC Holdings PLC
Senior Notes
3.40% due 03/08/2021.................. 208,000 209,832
Lloyds Banking Group PLC
Senior Notes
0.63% due 01/15/2024.................. EUR 125,000 137,608
Mitsubishi UFJ Financial Group, Inc.
Senior Notes
3.41% due 03/07/2024.................. 327,000 332,939
Mizuho Financial Group, Inc.
Senior Notes
3.55% due 03/05/2023.................. 495,000 504,400
NatWest Markets PLC
Senior Notes
3.63% due 09/29/2022*................. 200,000 199,911
Royal Bank of Scotland Group PLC
Senior Notes
1.75% due 03/02/2026.................. EUR 350,000 392,900
Royal Bank of Scotland Group PLC
Senior Notes
4.27% due 03/22/2025.................. 202,000 204,148
Royal Bank of Scotland Group PLC
Senior Notes
4.52% due 06/25/2024.................. 200,000 204,516
UBS AG
Sub. Notes
4.75% due 02/12/2026.................. EUR 250,000 298,475
UBS Group Funding Switzerland AG
Company Guar. Bonds
1.25% due 09/01/2026.................. EUR 225,000 257,300
UBS Group Funding Switzerland AG
Company Guar. Notes
3.49% due 05/23/2023*................. 200,000 200,955
UniCredit SpA
Sub. Notes
5.86% due 06/19/2032*................. 298,000 274,072
Principal Value
Security Description Amount(5) (Note 2)
Diversified Banking Institutions (continued)
UniCredit SpA
Sub. Notes
7.30% due 04/02/2034*....................... $ 234,000 $ 235,816
Woori Bank
Sub. Notes
4.75% due 04/30/2024........................ 200,000 210,084
----------
4,393,949
----------
Diversified Manufacturing Operations -- 0.2%
Ingersoll-Rand Luxembourg Finance SA
Company Guar. Notes
3.80% due 03/21/2029........................ 131,000 132,854
Siemens Financieringsmaatschappij NV
Company Guar. Notes
2.88% due 03/10/2028........................ EUR 200,000 265,887
----------
398,741
----------
Diversified Minerals -- 0.2%
Anglo American Capital PLC
Company Guar. Notes
3.25% due 04/03/2023........................ EUR 225,000 275,208
FMG Resources August 2006 Pty, Ltd.
Company Guar. Notes
5.13% due 03/15/2023*....................... 325,000 326,625
----------
601,833
----------
Electric-Generation -- 0.3%
Electricite de France SA
Senior Notes
1.00% due 10/13/2026........................ EUR 200,000 227,982
Greenko Investment Co.
Senior Sec. Notes
4.88% due 08/16/2023........................ 230,000 219,188
SPIC Luxembourg Latin America Renewable
Energy Investment Co. SARL
Company Guar. Notes
4.65% due 10/30/2023........................ 450,000 466,503
----------
913,673
----------
Electric-Integrated -- 0.4%
EDP Finance BV
Senior Notes
2.00% due 04/22/2025........................ EUR 335,000 398,521
Enel Finance International NV
Company Guar. Notes
3.63% due 05/25/2027*....................... 225,000 215,317
Gas Natural Fenosa Finance BV
Company Guar. Notes
1.38% due 01/21/2025........................ EUR 200,000 234,920
Iberdrola Finanzas SA
Company Guar. Notes
1.00% due 03/07/2025........................ EUR 300,000 347,976
----------
1,196,734
----------
Finance-Commercial -- 0.2%
Azure Orbit IV International Finance, Ltd.
Company Guar. Notes
3.75% due 01/25/2023........................ 200,000 200,791
33
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
FOREIGN CORPORATE BONDS & NOTES (continued)
Finance-Commercial (continued)
Unifin Financiera SAB de CV
Company Guar. Notes
7.25% due 09/27/2023.................. $ 200,000 $201,502
--------
402,293
--------
Finance-Leasing Companies -- 0.1%
CDBL Funding 1
Company Guar. Notes
3.00% due 04/24/2023.................. 200,000 194,383
ICBCIL Finance Co., Ltd.
Senior Notes
3.63% due 11/15/2027.................. 200,000 192,608
--------
386,991
--------
Food-Meat Products -- 0.2%
JBS USA LUX SA/JBS USA Finance, Inc.
Company Guar. Notes
5.88% due 07/15/2024*................. 632,000 649,380
--------
Gambling (Non-Hotel) -- 0.1%
LHMC Finco SARL
Senior Sec. Notes
7.88% due 12/20/2023*................. 295,000 304,588
--------
Insurance-Life/Health -- 0.0%
Athene Holding, Ltd.
Senior Notes
4.13% due 01/12/2028.................. 99,000 95,164
--------
Insurance-Reinsurance -- 0.0%
RenaissanceRe Holdings, Ltd.
Senior Notes
3.60% due 04/15/2029.................. 98,000 96,334
--------
Machinery-Farming -- 0.2%
CNH Industrial Finance Europe SA
Company Guar. Notes
1.88% due 01/19/2026.................. EUR 185,000 212,694
CNH Industrial NV
Senior Notes
3.85% due 11/15/2027.................. 173,000 165,724
CNH Industrial NV
Senior Notes
4.50% due 08/15/2023.................. 89,000 92,338
--------
470,756
--------
Medical Instruments -- 0.1%
Medtronic Global Holdings SCA
Company Guar. Notes
2.25% due 03/07/2039.................. EUR 125,000 152,373
--------
Medical-Drugs -- 0.6%
Bausch Health Cos., Inc.
Company Guar. Notes
5.88% due 05/15/2023*................. 800,000 810,000
Bayer Capital Corp BV
Company Guar. Notes
1.50% due 06/26/2026.................. EUR 200,000 226,543
Novartis Finance SA
Company Guar. Notes
1.63% due 11/09/2026.................. EUR 250,000 305,035
Principal Value
Security Description Amount(5) (Note 2)
Medical-Drugs (continued)
Takeda Pharmaceutical Co., Ltd.
Senior Notes
4.40% due 11/26/2023*.............. $ 205,000 $ 215,211
----------
1,556,789
----------
Medical-Generic Drugs -- 0.0%
Actavis Funding SCS
Company Guar. Notes
3.80% due 03/15/2025............... 73,000 73,952
----------
Metal-Copper -- 0.2%
First Quantum Minerals, Ltd.
Company Guar. Notes
6.50% due 03/01/2024*.............. 331,000 309,899
First Quantum Minerals, Ltd.
Company Guar. Notes
7.25% due 04/01/2023*.............. 257,000 251,217
----------
561,116
----------
Metal-Diversified -- 0.2%
Chinalco Capital Holdings, Ltd.
Company Guar. Notes
4.25% due 04/21/2022............... 450,000 445,323
Glencore Canada Financial Corp.
Company Guar. Notes
7.38% due 05/27/2020............... GBP 50,000 69,293
----------
514,616
----------
Oil & Gas Drilling -- 0.3%
Noble Holding International, Ltd.
Company Guar. Notes
7.88% due 02/01/2026*.............. 269,000 249,498
Shelf Drilling Holdings, Ltd.
Company Guar. Notes
8.25% due 02/15/2025*.............. 600,000 570,000
----------
819,498
----------
Oil Companies-Exploration & Production -- 0.4%
Anadarko Finance Co.
Company Guar. Notes
7.50% due 05/01/2031............... 51,000 63,656
MEG Energy Corp.
Sec. Notes
6.50% due 01/15/2025*.............. 637,000 627,560
Tengizchevroil Finance Co.
International, Ltd.
Senior Sec. Notes
4.00% due 08/15/2026............... 320,000 312,231
----------
1,003,447
----------
Oil Companies-Integrated -- 1.0%
BP Capital Markets PLC
Company Guar. Notes
2.97% due 02/27/2026............... EUR 400,000 518,565
BP Capital Markets PLC
Company Guar. Notes
3.51% due 03/17/2025............... 280,000 285,444
Cenovus Energy, Inc.
Senior Notes
4.25% due 04/15/2027............... 104,000 102,237
34
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
FOREIGN CORPORATE BONDS & NOTES (continued)
Oil Companies-Integrated (continued)
Cenovus Energy, Inc.
Senior Notes
5.20% due 09/15/2043........................ $ 107,000 $ 100,048
Ecopetrol SA
Senior Notes
5.88% due 05/28/2045........................ 300,000 310,875
Pertamina Persero PT
Senior Notes
4.88% due 05/03/2022*....................... 300,000 311,920
Petro-Canada
Senior Notes
5.95% due 05/15/2035........................ 47,000 55,102
Petroleos Mexicanos
Company Guar. Notes
6.50% due 01/23/2029........................ 300,000 297,300
Petroleos Mexicanos
Company Guar. Notes
6.63% due 06/15/2035........................ 700,000 659,750
----------
2,641,241
----------
Oil-Field Services -- 0.1%
KCA Deutag UK Finance PLC
Senior Sec. Notes
9.88% due 04/01/2022*....................... 446,000 383,560
----------
Paper & Related Products -- 0.2%
Cascades, Inc.
Company Guar. Notes
5.50% due 07/15/2022*....................... 67,000 67,335
Cascades, Inc.
Company Guar. Notes
5.75% due 07/15/2023*....................... 384,000 383,040
----------
450,375
----------
Satellite Telecom -- 0.5%
Intelsat Jackson Holdings SA
Company Guar. Notes
5.50% due 08/01/2023........................ 1,109,000 984,237
Telesat Canada/Telesat LLC
Company Guar. Notes
8.88% due 11/15/2024*....................... 368,000 396,520
----------
1,380,757
----------
Security Services -- 0.1%
Garda World Security Corp.
Senior Notes
8.75% due 05/15/2025*....................... 415,000 394,250
----------
Semiconductor Components-Integrated Circuits -- 0.0%
NXP BV/NXP Funding LLC
Company Guar. Notes
5.55% due 12/01/2028*....................... 102,000 110,467
----------
Special Purpose Entity -- 0.0%
Hellas Telecommunications Luxembourg II SCA
Sub. Notes
8.46% due 01/15/2015*+(4)(6)(7)............. 1,330,000 0
----------
Principal Value
Security Description Amount(5) (Note 2)
SupraNational Banks -- 0.0%
International Bank for Reconstruction &
Development
Senior Notes
3.13% due 11/20/2025.................... $ 103,000 $ 107,213
----------
Telephone-Integrated -- 0.4%
Ooredoo International Finance, Ltd.
Company Guar. Notes
3.75% due 06/22/2026.................... 360,000 357,750
Orange SA
Senior Notes
1.38% due 03/20/2028.................... EUR 100,000 115,651
Orange SA
Senior Notes
1.88% due 09/12/2030.................... EUR 200,000 238,125
Telecom Italia Capital SA
Company Guar. Notes
7.72% due 06/04/2038.................... 74,000 76,590
Telefonica Emisiones SAU
Company Guar. Notes
2.93% due 10/17/2029.................... EUR 100,000 127,659
Telefonica Emisiones SAU
Company Guar. Notes
4.67% due 03/06/2038.................... 260,000 248,159
----------
1,163,934
----------
Transport-Equipment & Leasing -- 0.2%
Avolon Holdings Funding, Ltd.
Company Guar. Notes
5.13% due 10/01/2023*................... 425,000 432,438
Avolon Holdings Funding, Ltd.
Company Guar. Notes
5.25% due 05/15/2024*................... 109,000 112,270
----------
544,708
----------
Transport-Marine -- 0.3%
PT Pelabuhan Indonesia II
Senior Notes
4.25% due 05/05/2025*................... 300,000 303,231
PT Pelabuhan Indonesia II
Senior Notes
4.25% due 05/05/2025.................... 625,000 631,731
----------
934,962
----------
Transport-Rail -- 0.3%
Canadian National Railway Co.
Senior Notes
2.85% due 12/15/2021.................... 56,000 56,080
Canadian Pacific Railway Co.
Senior Notes
6.13% due 09/15/2115.................... 107,000 131,413
Kazakhstan Temir Zholy Finance BV
Company Guar. Notes
6.95% due 07/10/2042.................... 600,000 686,424
----------
873,917
----------
35
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
FOREIGN CORPORATE BONDS & NOTES (continued)
Transport-Services -- 0.1%
Rumo Luxembourg SARL
Company Guar. Notes
7.38% due 02/09/2024............... $ 240,000 $ 255,288
-----------
Total Foreign Corporate Bonds & Notes
(cost $39,070,253)................. 37,344,113
-----------
FOREIGN GOVERNMENT OBLIGATIONS -- 11.0%
Sovereign -- 10.9%
Abu Dhabi Government
Senior Notes
3.13% due 10/11/2027............... 900,000 893,250
Arab Republic of Egypt
Senior Notes
8.50% due 01/31/2047............... 800,000 815,621
Dominican Republic
Senior Bonds
6.85% due 01/27/2045............... 1,250,000 1,337,500
Federal Republic of Nigeria
Senior Notes
7.14% due 02/23/2030*.............. 450,000 449,878
Federal Republic of Nigeria
Senior Notes
7.63% due 11/28/2047............... 650,000 632,151
Gabonese Republic
Bonds
6.38% due 12/12/2024............... 300,000 286,961
Government of Jamaica
Senior Notes
6.75% due 04/28/2028............... 600,000 666,756
Government of Jamaica
Senior Notes
8.00% due 03/15/2039............... 400,000 478,504
Government of Mongolia
Senior Notes
5.63% due 05/01/2023............... 300,000 302,985
Government of Ukraine
Senior Notes
7.75% due 09/01/2022............... 250,000 246,785
Kingdom of Jordan
Senior Notes
5.75% due 01/31/2027*.............. 450,000 440,415
Kingdom of Saudi Arabia
Senior Notes
4.38% due 04/16/2029*.............. 600,000 624,882
Oriental Republic of Uruguay
Senior Notes
4.38% due 01/23/2031............... 1,144,000 1,197,768
Republic of Argentina
Senior Notes
5.88% due 01/11/2028............... 610,000 467,870
Republic of Argentina
Senior Notes
6.88% due 01/26/2027............... 500,000 404,500
Republic of Argentina
Senior Notes
8.28% due 12/31/2033............... 1,261,834 1,044,168
Principal Value
Security Description Amount(5) (Note 2)
Sovereign (continued)
Republic of Belarus
Senior Notes
6.88% due 02/28/2023..... $ 300,000 $ 314,250
Republic of Belarus
Senior Notes
7.63% due 06/29/2027..... 700,000 751,304
Republic of Colombia
Senior Notes
4.38% due 07/12/2021..... 300,000 308,250
Republic of Colombia
Senior Notes
8.13% due 05/21/2024..... 1,200,000 1,450,200
Republic of Costa Rica
Senior Notes
4.25% due 01/26/2023..... 470,000 444,742
Republic of Costa Rica
Senior Bonds
7.16% due 03/12/2045..... 400,000 386,000
Republic of El Salvador
Senior Notes
6.38% due 01/18/2027..... 700,000 686,007
Republic of El Salvador
Senior Notes
7.63% due 02/01/2041..... 450,000 461,254
Republic of Ghana
Senior Notes
7.63% due 05/16/2029..... 450,000 439,846
Republic of Guatemala
Senior Notes
4.88% due 02/13/2028..... 560,000 555,106
Republic of Honduras
Senior Notes
6.25% due 01/19/2027..... 450,000 475,312
Republic of Hungary
Senior Notes
7.63% due 03/29/2041..... 300,000 445,242
Republic of Indonesia
Senior Notes
3.70% due 01/08/2022..... 500,000 506,310
Republic of Indonesia
Senior Bonds
4.13% due 01/15/2025..... 700,000 717,396
Republic of Ivory Coast
Senior Notes
6.13% due 06/15/2033*.... 1,000,000 920,300
Republic of Kazakhstan
Senior Notes
3.88% due 10/14/2024..... 600,000 617,784
Republic of Kenya
Senior Notes
6.88% due 06/24/2024..... 300,000 307,950
Republic of Kenya
Senior Notes
8.25% due 02/28/2048..... 300,000 303,529
Republic of Lebanon
Senior Notes
8.25% due 04/12/2021..... 310,000 290,036
36
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
FOREIGN GOVERNMENT OBLIGATIONS (continued)
Sovereign (continued)
Republic of Panama
Senior Notes
4.50% due 05/15/2047.......... $ 300,000 $ 316,410
Republic of Panama
Senior Notes
6.70% due 01/26/2036.......... 400,000 522,000
Republic of Paraguay
Senior Notes
5.00% due 04/15/2026.......... 400,000 420,972
Republic of Paraguay
Senior Notes
6.10% due 08/11/2044.......... 500,000 566,240
Republic of Sri Lanka
Senior Notes
6.83% due 07/18/2026.......... 1,000,000 1,000,185
Republic of Turkey
Senior Notes
6.88% due 03/17/2036.......... 470,000 427,305
Republic of Turkey
Senior Notes
7.00% due 06/05/2020.......... 400,000 403,520
Republic of Turkey
Senior Notes
8.00% due 02/14/2034.......... 650,000 653,146
Republic of Turkey
Senior Notes
11.88% due 01/15/2030......... 200,000 257,201
Russian Federation
Senior Notes
5.10% due 03/28/2035*......... 200,000 202,725
Russian Federation
Senior Bonds
5.10% due 03/28/2035.......... 200,000 202,725
State of Kuwait
Senior Notes
2.75% due 03/20/2022.......... 800,000 799,200
State of Qatar
Senior Notes
3.38% due 03/14/2024*......... 450,000 454,311
State of Qatar
Senior Notes
4.50% due 04/23/2028.......... 1,000,000 1,068,588
Sultanate of Oman
Senior Notes
6.75% due 01/17/2048.......... 1,800,000 1,597,050
United Kingdom Gilt Treasury
Bonds
3.50% due 01/22/2045.......... GBP 25,000 45,843
United Kingdom Gilt Treasury
Bonds
4.50% due 09/07/2034.......... GBP 120,000 $ 224,813
United Mexican States
Senior Bonds
4.75% due 03/08/2044.......... 190,000 186,675
-----------
30,019,721
-----------
Principal Value
Security Description Amount(5) (Note 2)
Sovereign Agency -- 0.1%
Kommunalbanken AS
Senior Notes
2.75% due 02/05/2024*.................. $ 204,000 $ 207,044
-----------
Total Foreign Government Obligations
(cost $30,446,335)..................... 30,226,765
-----------
U.S. GOVERNMENT AGENCIES -- 26.6%
Federal Home Loan Mtg. Corp. -- 6.5%
2.50% due 01/01/2028................... 192,352 192,313
2.50% due 04/01/2028................... 61,765 61,752
2.50% due 03/01/2031................... 107,075 106,474
2.50% due 11/01/2032................... 763,479 760,895
3.00% due 07/01/2045................... 2,036,979 2,033,051
3.00% due 10/01/2045................... 699,090 697,417
3.00% due 11/01/2046................... 2,896,246 2,887,969
3.50% due 03/01/2042................... 287,205 293,539
3.50% due 04/01/2042................... 301,691 308,343
3.50% due 09/01/2043................... 260,949 267,005
3.50% due 07/01/2045................... 2,718,424 2,770,999
3.50% due 11/01/2047................... 1,500,515 1,524,788
3.50% due 03/01/2048................... 3,688,110 3,760,307
4.00% due 01/01/2046................... 305,363 318,088
4.50% due 02/01/2020................... 479 487
4.50% due 08/01/2020................... 3,040 3,093
4.50% due 03/01/2039................... 1,266,987 1,350,835
4.50% due 12/01/2039................... 5,816 6,188
5.00% due 02/01/2034................... 17,836 19,225
5.00% due 05/01/2034................... 26,757 29,108
5.00% due 11/01/2043................... 180,255 194,238
5.50% due 05/01/2037................... 43,075 47,268
6.00% due 03/01/2040................... 32,951 36,302
6.50% due 02/01/2035................... 6,438 7,129
Federal Home Loan Mtg. Corp. FRS
4.33% (6 ML+1.49%)
due 02/01/2037......................... 9,036 9,311
4.52% (12 ML+1.89%)
due 11/01/2037......................... 77,434 81,478
Federal Home Loan Mtg. Corp. REMIC FRS
Series 3572, Class JS
4.32% (6.80%-1 ML)
due 09/15/2039(2)(8)(9)................ 326,894 38,809
Federal Home Loan Mtg. Corp. REMIC
Series 4740, Class BA
3.00% due 09/15/2045(2)................ 249,977 251,429
Series 1103, Class N
11.57% due 06/15/2021(2)(8)............ 125 5
-----------
18,057,845
-----------
Federal National Mtg. Assoc. -- 18.4%
2.50% due 12/01/2026................... 418,692 418,458
2.50% due 08/01/2031................... 1,722,486 1,714,108
2.50% due 02/01/2032................... 698,677 695,063
3.00% due 10/01/2027................... 185,725 188,108
3.00% due 03/01/2030................... 1,076,404 1,088,766
3.00% due 10/01/2030................... 170,646 172,234
3.00% due 02/01/2033................... 484,101 488,668
37
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
U.S. GOVERNMENT AGENCIES (continued)
Federal National Mtg. Assoc. (continued)
3.00% due 12/01/2042............. $ 117,926 $ 118,005
3.00% due 08/01/2046............. 3,881,488 3,870,865
3.00% due 04/01/2047............. 1,913,231 1,907,106
3.00% due 09/01/2048............. 2,176,854 2,170,045
3.50% due 08/01/2026............. 70,515 72,135
3.50% due 08/01/2027............. 52,100 53,296
3.50% due 10/01/2028............. 28,547 29,295
3.50% due 03/01/2033............. 1,683,056 1,721,712
3.50% due 02/01/2043............. 112,715 115,810
3.50% due 10/01/2045............. 243,684 248,569
3.50% due 11/01/2045............. 201,945 205,274
3.50% due 03/01/2046............. 2,372,385 2,409,442
3.50% due 07/01/2046............. 141,468 144,310
3.50% due 12/01/2047............. 7,957,562 8,093,175
3.50% due 04/01/2048............. 4,234,407 4,302,663
4.00% due 11/01/2025............. 103,890 107,509
4.00% due 03/01/2039............. 1,689,596 1,749,236
4.00% due 10/01/2043............. 285,633 297,986
4.00% due 02/01/2045............. 1,505,878 1,573,070
4.00% due 05/01/2047............. 588,942 608,669
4.00% due 07/01/2047............. 2,632,991 2,721,188
4.00% due 08/01/2047............. 2,743,432 2,835,330
4.00% due 06/01/2048............. 949,893 986,792
4.00% due 01/01/2049............. 2,135,186 2,198,550
4.00% due 03/01/2049............. 1,495,417 1,539,303
4.50% due 06/01/2019............. 496 505
4.50% due 11/01/2022............. 13,392 13,662
4.50% due 06/01/2023............. 10,236 10,505
4.50% due 08/01/2045............. 1,589,934 1,692,518
4.50% due 06/01/2048............. 331,599 346,884
4.50% due 10/01/2048............. 95,252 99,602
4.50% due 11/01/2048............. 1,941,171 2,029,760
5.00% due 06/01/2019............. 652 667
5.00% due 01/01/2023............. 4,686 4,791
5.00% due 03/01/2034............. 16,667 17,929
5.00% due 05/01/2035............. 9,611 10,336
5.00% due 05/01/2040............. 69,292 74,734
5.00% due 07/01/2040............. 70,127 75,641
5.50% due 06/01/2038............. 21,445 23,413
6.00% due 02/01/2032............. 4,457 4,800
6.00% due 05/01/2034............. 1,388 1,530
6.00% due 10/01/2034............. 17,866 19,242
7.50% due 01/01/2030............. 1,010 1,024
8.00% due 11/01/2028............. 2,444 2,651
Federal National Mtg. Assoc. FRS
4.27% (6 ML+1.54%)
due 09/01/2035................... 52,220 53,972
4.31% (12 ML+1.66%)
due 07/01/2039................... 48,432 50,481
4.31% (1 Yr USTYCR+2.26%)
due 11/01/2036................... 28,010 29,470
4.34% (12 ML+1.57%)
due 05/01/2037................... 15,208 15,839
4.53% (1 Yr USTYCR+2.22%)
due 10/01/2035................... 55,168 57,940
4.57% (12 ML+1.82%)
due 10/01/2040................... 16,176 16,932
Principal Value
Security Description Amount(5) (Note 2)
Federal National Mtg. Assoc. (continued)
4.58% (12 ML+1.91%)
due 08/01/2035......................... $ 47,788 $ 50,255
4.66% (12 ML+1.76%)
due 05/01/2040......................... 60,682 63,620
4.67% (12 ML+1.83%)
due 10/01/2040......................... 33,807 35,295
Federal National Mtg. Assoc. REMIC
Series 2017-94, Class DA
3.00% due 06/25/2045(2)................ 212,442 213,095
Series 2018-27, Class EA
3.00% due 05/25/2048(2)................ 369,680 367,596
Series 2018-35, Class CD
3.00% due 05/25/2048(2)................ 385,501 381,317
-----------
50,610,746
-----------
Government National Mtg. Assoc. -- 1.7%
3.00% due 05/20/2046................... 2,186,502 2,200,594
4.50% due 10/20/2045................... 1,390,053 1,462,871
4.50% due 04/20/2047................... 882,712 921,266
-----------
4,584,731
-----------
Total U.S. Government Agencies
(cost $72,025,628)..................... 73,253,322
-----------
U.S. GOVERNMENT TREASURIES -- 1.2%
United States Treasury Notes -- 1.2%
1.00% due 06/30/2019................... 2,000,000 1,992,500
2.50% due 01/31/2024................... 250,000 252,910
2.88% due 10/31/2020................... 1,000,000 1,008,086
-----------
Total U.S. Government Treasuries
(cost $3,243,771)...................... 3,253,496
-----------
LOANS(10)(11)(12) -- 5.5%
Auto Repair Centers -- 0.1%
Mavis Tire Express Services Corp. FRS
Delayed Draw
5.74% (3 ML+2.00%)
due 03/20/2025(17)..................... 15,925 15,547
Mavis Tire Express Services Corp. FRS
1st Lien
5.74% (1 ML+3.25%)
due 03/20/2025......................... 125,116 122,145
Mavis Tire Express Services Corp. FRS
Delayed Draw
coupon TBD
due 03/20/2025......................... 641 625
Wand NewCo 3, Inc. FRS
1st Lien
5.98% (1 ML+3.50%)
due 02/05/2026......................... 72,601 72,624
Wand NewCo 3, Inc. FRS
1st Lien
coupon TBD
due 02/05/2026......................... 30,435 30,444
-----------
241,385
-----------
38
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
LOANS (continued)
Auto-Heavy Duty Trucks -- 0.1%
Navistar Financial Corp. FRS
BTL-B
6.25% (1 ML+3.75%)
due 07/30/2025......................... $139,130 $138,609
--------
Broadcast Services/Program -- 0.1%
NEP Group, Inc. FRS
BTL
5.75% (1 ML+3.25%)
due 10/20/2025......................... 139,650 138,254
--------
Building & Construction Products-Misc. -- 0.0%
Forterra Finance LLC FRS
BTL-B
5.50% (1 ML+3.00%)
due 10/25/2023......................... 145,728 133,268
--------
Building & Construction-Misc. -- 0.0%
Verra Mobility Corp. FRS
1st Lien
6.25% (1 ML+3.75%)
due 02/28/2025......................... 134,480 134,101
--------
Building Products-Air & Heating -- 0.1%
API Heat Transfer ThermaSys Corp. FRS
1st Lien
8.80% (3 ML+6.00%)
due 12/31/2023......................... 160,178 144,160
--------
Building Products-Doors & Windows -- 0.1%
CHI Doors Holding Corp. FRS
1st Lien
5.75% (1 ML+3.25%)
due 07/29/2022......................... 138,534 137,842
--------
Building-Maintenance & Services -- 0.1%
Allied Universal Holdco LLC FRS
1st Lein
6.75% (1 ML+4.25%)
due 07/28/2022......................... 164,588 160,473
--------
Cable/Satellite TV -- 0.2%
Altice France SA FRS
BTL-B13
6.48% (1 ML+4.00%)
due 08/14/2026......................... 174,563 166,562
CSC Holdings LLC FRS
BTL-B
4.73% (1 ML+2.25%)
due 07/17/2025......................... 125,000 121,312
CSC Holdings LLC FRS
BTL-B
4.98% (1 ML+2.50%)
due 01/25/2026......................... 152,840 149,210
Unitymedia Finance LLC FRS
BTL-B
4.73% (1 ML+2.25%)
due 09/30/2025......................... 66,923 66,146
Unitymedia Finance LLC FRS
BTL-B
coupon TBD
due 09/30/2025......................... 73,077 72,229
--------
575,459
--------
Principal Value
Security Description Amount(5) (Note 2)
Casino Hotels -- 0.1%
Caesars Resort Collection LLC FRS
BTL-B
coupon TBD
due 12/22/2024.......................... $139,646 $137,926
CityCenter Holdings LLC FRS
BTL-B
coupon TBD
due 04/18/2024.......................... 140,642 137,595
--------
275,521
--------
Casino Services -- 0.0%
Stars Group Holdings FRS
BTL
6.10% (3 ML+3.50%)
due 07/10/2025.......................... 60,184 60,006
Stars Group Holdings FRS
BTL
coupon TBD
due 07/10/2025.......................... 72,704 72,488
--------
132,494
--------
Cellular Telecom -- 0.0%
Sprint Communications, Inc. FRS
BTL-B
5.50% (1 ML+3.00%)
due 02/02/2024.......................... 137,507 134,413
--------
Chemicals-Specialty -- 0.1%
LTI Holdings, Inc. FRS
1st Lien
6.00% (1 ML+3.50%)
due 09/06/2025.......................... 91,302 87,765
LTI Holdings, Inc. FRS
2nd Lien
9.25% (1 ML+6.75%)
due 09/06/2026.......................... 6,322 5,974
LTI Holdings, Inc. FRS
2nd Lien
coupon TBD
due 09/06/2026.......................... 45,000 42,525
Starfruit US HoldCo. LLC FRS
BTL-B
5.74% (1 ML+3.25%)
due 10/01/2025.......................... 140,499 138,260
--------
274,524
--------
Commercial Services-Finance -- 0.1%
Financial & Risk US Holdings, Inc. FRS
BTL
6.25% (1 ML+3.75%)
due 10/01/2025.......................... 137,317 133,112
MoneyGram International, Inc. FRS
BTL-B
5.74% (1 ML+3.25%)
due 03/27/2020.......................... 110,888 104,235
Verscend Holding Corp. FRS
BTL-B
7.00% (1 ML+4.50%)
due 08/24/2025.......................... 33,783 33,424
--------
270,771
--------
39
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
LOANS (continued)
Computer Data Security -- 0.0%
McAfee LLC FRS
BTL-B1
6.25% (1 ML+3.75%)
due 09/30/2024...................... $134,662 $134,157
--------
Computer Services -- 0.1%
Tempo Acquisition LLC FRS
BTL-B
coupon TBD
due 05/01/2024...................... 137,650 136,230
--------
Computer Software -- 0.1%
Rackspace Hosting, Inc. FRS
1st Lien
5.74% (3 ML+3.00%)
due 11/03/2023...................... 141,073 131,727
Vertafore, Inc. FRS
1st Lein
5.75% (3 ML+3.25%)
due 07/02/2025...................... 69,825 68,498
Vertafore, Inc. FRS
2nd Lien
9.75% (1 ML+7.25%)
due 07/02/2026...................... 72,934 71,977
--------
272,202
--------
Consulting Services -- 0.1%
AlixPartners LLP FRS
BTL
coupon TBD
due 04/04/2024...................... 138,646 137,693
Stiphout Finance LLC FRS
1st Lien
5.50% (1 ML+3.00%)
due 10/26/2022...................... 32,555 31,985
--------
169,678
--------
Containers-Metal/Glass -- 0.1%
BWAY Corp. FRS
BTL
6.03% (3 ML+3.25%)
due 04/03/2024...................... 140,642 136,950
--------
Containers-Paper/Plastic -- 0.0%
Charter NEX US, Inc. FRS
1st Lien
5.25% (1 ML+2.75%)
due 05/16/2024...................... 99,746 96,567
--------
Data Processing/Management -- 0.1%
CCC Information Services, Inc. FRS
1st Lien
coupon TBD
due 04/26/2024...................... 138,647 136,091
--------
Dialysis Centers -- 0.0%
U.S. Renal Care, Inc. FRS
1st Lien
6.85% (3 ML+4.25%)
due 12/30/2022...................... 86,362 86,125
--------
Principal Value
Security Description Amount(5) (Note 2)
Disposable Medical Products -- 0.2%
Sterigenics-Nordion Holdings LLC FRS
BTL
5.50% (1 ML+3.00%)
due 05/15/2022........................ $ 144,264 $141,198
Sterigenics-Nordion Holdings LLC FRS
BTL
coupon TBD
due 05/15/2022........................ 406,962 398,314
--------
539,512
--------
Distribution/Wholesale -- 0.1%
Univar USA, Inc. FRS
BTL-B3
4.75% (1 ML+2.25%)
due 07/01/2024........................ 139,908 138,159
--------
E-Commerce/Services -- 0.1%
RentPath LLC FRS
2nd Lien
11.50% (1 ML+9.00%)
due 12/17/2022........................ 1,062,906 403,904
--------
Electric-Generation -- 0.0%
TEX Operations Co. LLC FRS
BTL
4.50% (1 ML+2.00%)
due 08/04/2023........................ 104,732 103,423
--------
Electronic Components-Misc. -- 0.0%
AI Ladder Luxembourg Subco SARL FRS
BTL
7.10% (3 ML+4.50%)
due 07/09/2025........................ 136,243 133,518
--------
Electronic Components-Semiconductors -- 0.0%
Bright Bidco BV FRS
BTL-B
6.00% (1 ML+3.50%)
due 06/30/2024........................ 43,734 34,112
Bright Bidco BV FRS
BTL-B
6.10% (3 ML+3.50%)
due 06/30/2024........................ 90,924 70,921
--------
105,033
--------
Enterprise Software/Service -- 0.4%
Almonde, Inc. FRS
BTL-B
6.10% (3 ML+3.50%)
due 06/13/2024........................ 144,614 139,100
Applied Systems, Inc. FRS
1st Lein
5.50% (1 ML+3.00%)
due 09/19/2024........................ 134,658 132,751
Epicor Software Corp. FRS
1st Lien
coupon TBD
due 06/01/2022........................ 135,000 133,256
40
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
LOANS (continued)
Enterprise Software/Service (continued)
ETA Australia Holdings III Pty, Ltd. FRS
BTL
coupon TBD
due 03/08/2026............................ $104,103 $ 103,843
Focus Financial Partners LLC FRS
BTL
5.75% (1 ML+3.25%)
due 08/05/2022............................ 139,645 139,157
Greeneden US Holdings II LLC FRS
BTL
coupon TBD
due 12/01/2023............................ 139,646 137,517
Kronos, Inc. FRS
1st Lien
coupon TBD
due 11/01/2023............................ 140,000 138,337
Sophia LP FRS
BTL-B
coupon TBD
due 09/30/2022............................ 135,873 134,642
----------
1,058,603
----------
Finance-Credit Card -- 0.0%
Pi US Mergerco, Inc. FRS
1st Lien
6.00% (1 ML+3.50%)
due 12/20/2024............................ 137,632 134,879
----------
Finance-Investment Banker/Broker -- 0.1%
Deerfield Holdings Corp. Acquisition FRS
BTL-B
5.75% (1 ML+3.25%)
due 02/13/2025............................ 119,006 116,106
Deerfield Holdings Corp. Acquisition FRS
BTL-B
coupon TBD
due 02/13/2025............................ 19,950 19,464
----------
135,570
----------
Gambling (Non-Hotel) -- 0.0%
Mohegan Tribal Gaming Authority FRS
BTL-B
coupon TBD
due 10/13/2023............................ 138,636 129,798
----------
Hazardous Waste Disposal -- 0.1%
GFL Environmental, Inc. FRS
BTL
coupon TBD
due 05/30/2025............................ 141,643 136,951
----------
Human Resources -- 0.1%
Team Health Holdings, Inc. FRS
1st Lien
5.25% (1 ML+2.75%)
due 02/06/2024............................ 397,970 352,535
----------
Principal Value
Security Description Amount(5) (Note 2)
Insurance Brokers -- 0.1%
Alliant Holdings Intermediate LLC FRS
BTL-B1
5.23% (1 ML+2.75%)
due 05/09/2025................................. $139,648 $134,132
HUB International, Ltd. FRS
BTL-B
5.51% (3 ML+2.75%)
due 04/25/2025................................. 140,593 135,643
USI, Inc. FRS
BTL
5.60% (3 ML+3.00%)
due 05/16/2024................................. 130,111 125,557
--------
395,332
--------
Insurance-Multi-line -- 0.1%
York Risk Services Holdings Corp. FRS
BTL-B
6.25% (1 ML+3.75%)
due 10/01/2021................................. 350,413 323,548
--------
Insurance-Property/Casualty -- 0.1%
Asurion LLC FRS
BTL-B6
5.50% (1 ML+3.00%)
due 11/03/2023................................. 141,277 140,306
Asurion LLC FRS
2nd Lien
9.00% (1 ML+6.50%)
due 08/04/2025................................. 7,101 7,185
Sedgwick Claims Management Services, Inc. FRS
BTL
5.75% (1 ML+3.25%)
due 12/31/2025................................. 119,400 116,751
--------
264,242
--------
Internet Financial Services -- 0.1%
ION Trading Finance, Ltd. FRS
BTL
6.65% (3 ML+4.00%)
due 11/21/2024................................. 143,172 138,877
--------
Machinery-Electrical -- 0.0%
Brookfield WEC Holdings, Inc. FRS
1st Lien
coupon TBD
due 08/01/2025................................. 102,743 102,511
--------
Machinery-General Industrial -- 0.1%
Shape Technologies Group, Inc. FRS
BTL
5.78% (3 ML+3.00%)
due 04/21/2025................................. 94,041 92,630
Shape Technologies Group, Inc. FRS
BTL
coupon TBD
due 04/21/2025................................. 43,889 43,231
--------
135,861
--------
41
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
LOANS (continued)
Machinery-Pumps -- 0.1%
STS Operating, Inc. FRS
BTL
6.75% (1 ML+4.25%)
due 12/11/2024..................... $138,467 $135,524
Titan Acquisition, Ltd. FRS
BTL
5.50% (1 ML+3.00%)
due 03/28/2025..................... 109,715 101,651
--------
237,175
--------
Marine Services -- 0.1%
Drew Marine Group, Inc. FRS
1st Lien
5.75% (1 ML+3.25%)
due 11/19/2020..................... 252,512 250,618
--------
Medical Products -- 0.0%
Auris Luxembourg III SARL FRS
BTL
6.25% (1 ML+3.75%)
due 02/27/2026..................... 19,898 19,810
VVC Holding Corp. FRS
BTL-B
7.20% (3 ML+4.50%)
due 02/11/2026..................... 45,455 44,697
--------
64,507
--------
Medical-Drugs -- 0.2%
Akorn, Inc. FRS
BTL-B
8.00% (1 ML+5.50%)
due 04/16/2021..................... 355,000 287,550
Alphabet Holding Co., Inc. FRS
1st Lien
6.00% (1 ML+3.50%)
due 09/26/2024..................... 146,746 135,648
Bausch Health Companies, Inc. FRS
BTL
5.23% (1 ML+2.75%)
due 11/27/2025..................... 98,561 97,354
--------
520,552
--------
Medical-Generic Drugs -- 0.1%
Alvogen Pharma US, Inc. FRS
BTL-B
7.25% (1 ML+4.75%)
due 04/02/2022..................... 133,129 129,301
Amneal Pharmaceuticals LLC FRS
BTL-B
6.00% (1 ML+3.50%)
due 05/04/2025..................... 137,653 137,080
--------
266,381
--------
Medical-HMO -- 0.0%
MultiPlan, Inc. FRS
BTL-B
5.35% (3 ML+2.75%)
due 06/07/2023..................... 122,027 117,940
--------
Principal Value
Security Description Amount(5) (Note 2)
Metal Processors & Fabrication -- 0.2%
Crosby US Acquisition Corp. FRS
1st Lien
5.49% (1 ML+3.00%)
due 11/23/2020.................................. $140,930 $137,172
Doncasters Group, Ltd. FRS
BTL
6.10% (3 ML+3.50%)
due 04/09/2020.................................. 253,681 223,239
Dynacast International LLC FRS
BTL
5.85% (3 ML+3.25%)
due 01/28/2022.................................. 139,636 137,193
--------
497,604
--------
Oil Companies-Exploration & Production -- 0.1%
Osum Production Corp. FRS
BTL
8.10% (3 ML+5.50%)
due 07/28/2020(4)............................... 409,638 364,578
--------
Oil-Field Services -- 0.1%
Lucid Energy Group II Borrower LLC FRS
1st Lien
5.49% (1 ML+3.00%)
due 02/17/2025.................................. 147,627 139,785
--------
Pipelines -- 0.0%
Medallion Midland Acquisition LLC FRS
BTL
5.75% (1 ML+3.25%)
due 10/30/2024.................................. 136,105 132,363
--------
Publishing-Books -- 0.1%
Houghton Mifflin Harcourt Publishers, Inc. FRS
BTL
5.50% (1 ML+3.00%)
due 05/31/2021.................................. 111,315 105,193
Houghton Mifflin Harcourt Publishers, Inc. FRS
BTL
coupon TBD
due 05/31/2021.................................. 35,304 33,362
--------
138,555
--------
Publishing-Periodicals -- 0.0%
Meredith Corp. FRS
BTL-B1
5.25% (1 ML+2.75%)
due 01/31/2025.................................. 68,087 67,874
Meredith Corp. FRS
BTL-B1
coupon TBD
due 01/31/2025.................................. 66,432 66,225
--------
134,099
--------
Quarrying -- 0.1%
US Silica Co. FRS
BTL-B
6.50% (1 ML+4.00%)
due 05/01/2025.................................. 151,964 143,036
--------
42
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount(5) (Note 2)
LOANS (continued)
Real Estate Management/Services -- 0.1%
DTZ U. S. Borrower LLC FRS
BTL-B
5.75% (1 ML+3.25%)
due 08/21/2025............................ $138,526 $137,141
--------
Resort/Theme Parks -- 0.1%
SW Acquisitions Co., Inc. FRS
BTL-B5
5.50% (1 ML+3.00%)
due 03/31/2024............................ 137,580 136,462
--------
Retail-Hypermarkets -- 0.1%
Smart & Final Stores LLC FRS
1st Lien
6.13% (3 ML+3.50%)
due 11/15/2022............................ 143,000 135,850
--------
Retail-Major Department Stores -- 0.1%
Hudson's Bay Co. FRS
BTL-B
5.74% (1 ML+3.25%)
due 09/30/2022............................ 140,003 136,153
--------
Retail-Petroleum Products -- 0.1%
EG America LLC FRS
BTL
6.60% (3 ML+4.00%)
due 02/07/2025............................ 351,451 342,518
--------
Retail-Restaurants -- 0.1%
IRB Holding Corp. FRS
BTL-B
5.74% (1 ML+3.25%)
due 02/05/2025............................ 139,647 136,025
--------
Retail-Sporting Goods -- 0.0%
Bass Pro Group LLC FRS
BTL
7.50% (1 ML+5.00%)
due 09/25/2024............................ 135,098 131,974
--------
Retail-Vitamins & Nutrition Supplements -- 0.1%
JP Intermediate B LLC FRS
BTL
8.24% (3 ML+5.50%)
due 11/20/2025............................ 418,331 389,047
--------
Satellite Telecom -- 0.0%
Intelsat Jackson Holdings SA FRS
BTL-B3
6.24% (1 ML+3.75%)
due 11/27/2023............................ 135,000 132,131
--------
Security Services -- 0.0%
Prime Security Services Borrower LLC FRS
BTL-B1
coupon TBD
due 05/02/2022............................ 120,937 119,533
--------
Soap & Cleaning Preparation -- 0.0%
Diamond BC BV FRS
BTL
5.74% (3 ML+3.00%)
due 09/06/2024............................ 141,093 134,567
--------
Shares/
Principal Value
Security Description Amount(5) (Note 2)
Telecom Services -- 0.1%
GTT Communications, Inc. FRS
BTL-B
5.25% (1 ML+2.75%)
due 05/31/2025................................ $143,813 $ 135,235
West Corp. FRS
BTL-B1
6.13% (3 ML+3.50%)
due 10/10/2024................................ 166,197 153,836
-----------
289,071
-----------
Telecommunication Equipment -- 0.0%
CommScope, Inc. FRS
BTL-B
coupon TBD
due 04/06/2026................................ 70,565 70,512
-----------
Telephone-Integrated -- 0.1%
CenturyLink, Inc. FRS
BTL-B
5.25% (1 ML+2.75%)
due 01/31/2025................................ 136,105 133,043
Level 3 Financing, Inc. FRS
BTL-B
4.74% (3 ML+2.25%)
due 02/22/2024................................ 135,000 133,240
-----------
266,283
-----------
Theaters -- 0.1%
AMC Entertainment Holdings, Inc. FRS
BTL-B
coupon TBD
due 03/14/2026................................ 137,374 136,301
Cineworld, Ltd. FRS
BTL
5.00% (1 ML+2.50%)
due 02/28/2025................................ 135,509 132,155
William Morris Endeavor Entertainment LLC FRS
BTL-B1
5.36% (3 ML+2.75%)
due 05/18/2025................................ 144,620 135,220
-----------
403,676
-----------
Transport-Truck -- 0.1%
Pods LLC FRS
1st Lien
5.24% (1 ML+2.75%)
due 12/06/2024................................ 151,562 148,455
-----------
Travel Services -- 0.1%
Travelport Finance Luxembourg SARL FRS
BTL
coupon TBD
due 03/13/2026................................ 149,796 145,863
-----------
Total Loans
(cost $16,083,955)............................ 15,053,984
-----------
COMMON STOCKS -- 0.2%
Building Products-Air & Heating -- 0.0%
API Heat Transfer, Inc.+(13)................... 171,230 47,088
-----------
43
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Shares/
Principal Value
Security Description Amount(5) (Note 2)
COMMON STOCKS (continued)
Television -- 0.2%
ION Media Networks, Inc.+(4)(13). 655 $587,653
--------
Total Common Stocks
(cost $56,512).................. 634,741
--------
PREFERRED SECURITIES -- 0.1%
Building Products-Air & Heating -- 0.0%
API Heat Transfer, Inc., Class A
8.63%(13)....................... 36,495 32,967
--------
Electric-Distribution -- 0.1%
Entergy Louisiana LLC
4.70%........................... 5,200 128,180
--------
Sovereign Agency -- 0.0%
Federal Home Loan Mtg. Corp.
Series Z
8.38%+.......................... 5,875 58,985
--------
Total Preferred Securities
(cost $257,206)................. 220,132
--------
PREFERRED SECURITIES/CAPITAL SECURITIES -- 1.8%
Banks-Commercial -- 0.1%
Cooperatieve Rabobank UA
11.00% due 06/30/2019*(14)...... $ 227,000 231,256
--------
Banks-Money Center -- 0.1%
BBVA Bancomer SA
5.13% due 01/18/2033*........... 201,000 184,819
--------
Banks-Super Regional -- 0.1%
Huntington Bancshares, Inc.
Series E
5.70% due 04/15/2023(14)........ 64,000 62,400
Wells Fargo Capital X
5.95% due 12/01/2086............ 112,000 123,200
--------
185,600
--------
Diversified Banking Institutions -- 0.3%
Bank of Nova Scotia
4.65% due 10/12/2022(14)........ 226,000 207,920
HSBC Holdings PLC
6.00% due 05/22/2027(14)........ 273,000 270,680
JPMorgan Chase & Co.
Series CC
4.63% due 11/01/2022(14)........ 186,000 172,980
JPMorgan Chase & Co.
Series U
6.13% due 04/30/2024(14)........ 159,000 166,759
--------
818,339
--------
Diversified Minerals -- 0.1%
BHP Billiton Finance, Ltd.
6.50% due 10/22/2077............ GBP 100,000 145,403
--------
Electric-Generation -- 0.1%
Electricite de France SA
4.25% due 01/29/2020(14)........ EUR 200,000 231,067
--------
Electric-Integrated -- 0.1%
Dominion Resources, Inc.
5.75% due 10/01/2054............ 91,000 92,843
Principal Value
Security Description Amount(5) (Note 2)
Electric-Integrated (continued)
Gas Natural Fenosa Finance BV
3.38% due 04/24/2024(14)..................... EUR 100,000 $ 113,188
------------
206,031
------------
Finance-Investment Banker/Broker -- 0.0%
Lehman Brothers Holdings Capital Trust VII
Escrow Security
0.00%+(4).................................... 222,000 22
------------
Finance-Other Services -- 0.1%
National Rural Utilities Cooperative Finance
Corp.
4.75% due 04/30/2043......................... 272,000 262,018
------------
Food-Dairy Products -- 0.1%
Land O'Lakes Capital Trust I
7.45% due 03/15/2028*........................ 367,000 393,607
------------
Insurance-Life/Health -- 0.1%
Aviva PLC
6.13% due 07/05/2043......................... EUR 115,000 148,831
Prudential Financial, Inc.
5.70% due 09/15/2048......................... 238,000 240,868
------------
389,699
------------
Insurance-Multi-line -- 0.1%
Assurant, Inc.
7.00% due 03/27/2048......................... 170,000 170,349
------------
Metal-Diversified -- 0.2%
China Minmetals Corp.
3.75% due 11/13/2022(14)..................... 675,000 658,575
------------
Oil Companies-Integrated -- 0.1%
TOTAL SA
2.71% due 05/05/2023(14)..................... EUR 275,000 324,159
------------
Pipelines -- 0.1%
Energy Transfer Partners LP
6.25% due 02/15/2023(14)..................... 75,000 70,875
EnLink Midstream Partners LP
6.00% due 12/15/2022(14)..................... 67,000 55,443
Enterprise Products Operating LLC
5.25% due 08/16/2077......................... 57,000 52,725
TransCanada Trust
5.30% due 03/15/2077......................... 99,000 92,565
TransCanada Trust
5.63% due 05/20/2075......................... 83,000 81,149
------------
352,757
------------
Water -- 0.1%
Suez
3.00% due 06/23/2020(14)..................... EUR 300,000 344,659
------------
Total Preferred Securities/Capital Securities
(cost $5,000,706)............................ 4,898,360
------------
Total Long-Term Investment Securities
(cost $268,443,427).......................... 266,030,018
------------
44
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Value
Security Description Shares (Note 2)
SHORT-TERM INVESTMENT SECURITIES -- 3.9%
Registered Investment Companies -- 3.9%
State Street Institutional U.S. Government Money
Market Fund, Premier Class 2.39%(15) (cost
$10,796,666)................................... 10,796,666 $ 10,796,666
------------
TOTAL INVESTMENTS
(cost $279,240,093)(16)........................ 100.5% 276,826,684
Liabilities in excess of other assets............. (0.5) (1,375,412)
---------- ------------
NET ASSETS 100.0% $275,451,272
========== ============
--------
* Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be sold in transactions exempt from
registration, normally to qualified institutional buyers. The Fund has no
right to demand registration of these securities. At March 31, 2019, the
aggregate value of these securities was $62,331,997 representing 22.6% of
net assets.
+ Non-income producing security
(1) Commercial Mortgage Backed Security
(2) Collateralized Mortgage Obligation
(3) Certain variable rate securities are not based on a published reference
rate and spread but are determined by the issuer or agent and are based on
current market conditions. These securities do not indicate a reference
rate and spread in their description above.
(4) Securities classified as Level 3 (see Note 2).
(5) Denominated in United States dollars unless otherwise indicated.
(6) Company has filed for bankruptcy protection.
(7) Security in default of interest and principal at maturity.
(8) Interest Only
(9) Inverse Floating Rate Security that pays interest that varies inversely to
changes in the market interest rates. The interest rate shown is the
current interest rate at March 31, 2019.
(10) Senior loans in the Fund are generally subject to mandatory and/or
optional prepayment. Because of these mandatory prepayment conditions and
because there may be significant economic incentives for a borrower to
prepay, prepayments may occur. As a result, the actual remaining maturity
may be substantially less than the stated maturities shown.
(11) The Fund invests in senior loans which generally pay interest at rates
which are periodically re-determined by reference to a base lending rate
plus a premium. These base lending rates are generally either the lending
rate offered by one or more major European banks, such as the London
Inter-Bank Offered Rate ("LIBOR") or the prime rate offered by one or more
major United States banks, or the certificate of deposit rate. Senior
loans are generally considered to be restrictive in that the Fund is
ordinarily contractually obligated to receive approval from the Agent Bank
and/or borrower prior to the disposition of a senior loan.
(12) All loans in the Fund were purchased through assignment agreements unless
otherwise indicated.
(13) Denotes a restricted security that: (a) cannot be offered for public sale
without first being registered, or being able to take advantage of an
exemption from registration, under the Securities Act of 1933, as amended
(the "1933 Act"); (b) is subject to a contractual restriction on public
sales; or (c) is otherwise subject to a restriction on sales by operation
of applicable law. Restricted securities are valued pursuant to Note
2. Certain restricted securities held by the Fund may not be sold except
in exempt transactions or in a public offering registered under the 1933
Act. The Fund has no right to demand registration of these securities. The
risk of investing in certain restricted securities is greater than the
risk of investing in the securities of widely held, publicly traded
companies. To the extent applicable, lack of a secondary market and resale
restrictions may result in the inability of a Fund to sell a security at a
fair price and may substantially delay the sale of the security. In
addition, certain restricted securities may exhibit greater price
volatility than securities for which secondary markets exist. As of
March 31, 2019, the Fund held the following restricted securities:
Value % of
Acquisition Acquisition Per Net
Description Date Shares Cost Value Share Assets
----------- ----------- ------- ----------- -------- ------- ------
Common Stocks
API Heat Transfer, Inc........ 12/31/2018 171,230 56,506 $ 47,088 $ 0.27 0.02%
ION Media Networks, Inc....... 12/16/2016 655 6 587,653 897.18 0.21%
Preferred Securities
API Heat Transfer, Inc.,
Class A...................... 12/31/2018 36,495 36,495 32,967 0.90 0.01%
-------- ----
$667,708 0.24%
======== ====
(14) Perpetual maturity - maturity date reflects the next call date.
(15) The rate shown is the 7-day yield as of March 31, 2019.
(16) See Note 5 for cost of investments on a tax basis.
(17) All or a portion of this holding is subject to unfunded loan commitments
(See Note 10).
BTL --Bank Term Loan
REMIC --Real Estate Mortgage Investment Conduit
TBD --Senior loan purchased on a when issued or delayed-delivery basis. Certain
details associated with this purchase are not known prior to the
settlement date of the transaction. In addition, senior loans typically
trade without accrued interest and therefore a coupon rate is not
available prior to the settlement.
FRS --Floating Rate Security
VRS --Variable Rate Security
The rates shown on FRS and VRS are the current interest rates at March 31, 2019
and unless noted otherwise, the dates shown are the original maturity dates.
Currency Legend
EUR --Euro Currency
GBP --British Pound
Index Legend
1 ML -- 1 Month USD LIBOR
3 ML -- 3 Month USD LIBOR
6 ML -- 6 Month USD LIBOR
12 ML -- 12 Month USD LIBOR
1 Yr USTYCR -- 1 Year US Treasury Yield Curve Rate
45
AIG Strategic Bond Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Forward Foreign Currency Contracts
Contract In Exchange Delivery Unrealized Unrealized
Counterparty to Deliver For Date Appreciation Depreciation
------------------------------------------------------------------------------------------
JPMorgan Chase Bank N.A EUR 5,765,000 USD 6,591,936 05/09/2019 $104,840 $ --
EUR 6,085,000 USD 6,920,119 06/06/2019 56,913 --
GBP 956,125 USD 1,265,310 06/06/2019 15,992 --
USD 302,969 EUR 266,000 05/09/2019 -- (3,651)
-------- -------
Net Unrealized Appreciation/(Depreciation).... $177,745 $(3,651)
======== =======
EUR --Euro Currency
GBP --Pound Sterling
USD --United States Dollar
The following is a summary of the inputs used to value the Fund's net assets as
of March 31, 2019 (see Note 2):
Level 1 -- Unadjusted Level 2 -- Other Level 3 -- Significant
Quoted Prices Observable Inputs Unobservable Inputs Total
- --------------------- ----------------- ---------------------- ------------
ASSETS:
Investments at Value:*
Asset Backed Securities.................. $ -- $ 7,853,441 $ -- $ 7,853,441
U.S. Corporate Bonds & Notes:
Airlines............................... -- -- 24,688 24,688
Finance-Investment Banker/Broker....... -- 666,532 64 666,596
Gambling (Non-Hotel)................... -- 413,363 26,389 439,752
Rubber/Plastic Products................ -- -- 0 0
Other Industries....................... -- 92,160,628 -- 92,160,628
Foreign Corporate Bonds & Notes:
Special Purpose Entity................. -- -- 0 0
Other Industries....................... -- 37,344,113 -- 37,344,113
Foreign Government Obligations........... -- 30,226,765 -- 30,226,765
U.S. Government Agencies................. -- 73,253,322 -- 73,253,322
U.S. Government Treasuries............... -- 3,253,496 -- 3,253,496
Loans:
Oil Companies-Exploration & Production. -- -- 364,578 364,578
Other Industries....................... -- 14,689,406 -- 14,689,406
Common Stocks:
Building Products-Air & Heating........ -- 47,088 -- 47,088
Television............................. -- -- 587,653 587,653
Preferred Securities:
Building Products-Air & Heating........ -- 32,967 -- 32,967
Other Industries....................... 187,165 -- -- 187,165
Preferred Securities/Capital Securities:
Finance-Investment Banker/Broker....... -- -- 22 22
Other Industries....................... -- 4,898,338 -- 4,898,338
Short-Term Investment Securities......... 10,796,666 -- -- 10,796,666
----------- ------------ ---------- ------------
Total Investments at Value............... $10,983,831 $264,839,459 $1,003,394 $276,826,684
=========== ============ ========== ============
Other Financial Instruments:+
Forward Foreign Currency Contracts....... $ -- $ 177,745 $ -- $ 177,745
=========== ============ ========== ============
LIABILITIES:
Other Financial Instruments:+
Forward Foreign Currency Contracts....... $ -- $ 3,651 $ -- $ 3,651
=========== ============ ========== ============
--------
* For a detailed presentation of investments, please refer to the Portfolio of
Investments.
+ Amounts presented represent unrealized appreciation/depreciation as of the
end of the reporting period.
At the beginning and end of the reporting period, Level 3 investments were not
considered a material portion of the Fund. There were no material Level 3
transfers during the reporting period.
See Notes to Financial Statements
46
AIG Flexible Credit Fund
PORTFOLIO PROFILE -- March 31, 2019 -- (unaudited)
Industry Allocation*
Registered Investment Companies........ 4.7%
Medical-Hospitals...................... 3.8
Oil Companies-Exploration & Production. 3.0
Cable/Satellite TV..................... 2.8
U.S. Government Treasuries............. 2.2
Real Estate Investment Trusts.......... 2.1
Containers-Metal/Glass................. 2.1
Enterprise Software/Service............ 2.0
Casino Hotels.......................... 1.9
Chemicals-Specialty.................... 1.8
Pipelines.............................. 1.8
Building-Residential/Commercial........ 1.8
Finance-Consumer Loans................. 1.7
Broadcast Services/Program............. 1.7
Medical-Drugs.......................... 1.6
Auto/Truck Parts & Equipment-Original.. 1.6
Medical Labs & Testing Services........ 1.6
Telephone-Integrated................... 1.5
Oil-Field Services..................... 1.4
Food-Misc./Diversified................. 1.3
Containers-Paper/Plastic............... 1.3
Building & Construction Products-Misc.. 1.3
Casino Services........................ 1.2
Finance-Mortgage Loan/Banker........... 1.2
Computer Software...................... 1.2
Computer Services...................... 1.2
Oil & Gas Drilling..................... 1.1
Telecom Services....................... 1.1
Gambling (Non-Hotel)................... 1.1
Theaters............................... 1.1
Exchange-Traded Funds.................. 1.0
Finance-Credit Card.................... 1.0
Soap & Cleaning Preparation............ 1.0
Independent Power Producers............ 1.0
Auto-Heavy Duty Trucks................. 1.0
Distribution/Wholesale................. 0.9
Sovereign.............................. 0.9
Diagnostic Equipment................... 0.9
Building Products-Cement............... 0.9
Machinery-Electrical................... 0.9
Commercial Services.................... 0.8
Machinery-General Industrial........... 0.8
Investment Companies................... 0.8
Building-Heavy Construction............ 0.8
Machinery-Pumps........................ 0.7
Electric-Generation.................... 0.7
Applications Software.................. 0.7
Aerospace/Defense-Equipment............ 0.7
Cellular Telecom....................... 0.7
Rubber/Plastic Products................ 0.7
Housewares............................. 0.7
Food-Retail............................ 0.7
Steel-Producers........................ 0.7
Medical-Generic Drugs.................. 0.6
Chemicals-Diversified.................. 0.6
Food-Dairy Products.................... 0.6
Insurance-Property/Casualty............ 0.6
Dialysis Centers....................... 0.6
Hotels/Motels.......................... 0.6
Retail-Major Department Stores......... 0.5
Consulting Services.................... 0.5
Publishing-Periodicals.................. 0.5%
Cosmetics & Toiletries.................. 0.5
Transport-Equipment & Leasing........... 0.5
Commercial Services-Finance............. 0.5
Direct Marketing........................ 0.5
Diagnostic Kits......................... 0.5
Medical Information Systems............. 0.5
Telecommunication Equipment............. 0.5
Banks-Super Regional.................... 0.5
Television.............................. 0.5
Disposable Medical Products............. 0.5
Pharmacy Services....................... 0.5
Diversified Minerals.................... 0.5
Medical-HMO............................. 0.5
Retail-Sporting Goods................... 0.5
Insurance-Multi-line.................... 0.5
Computers-Integrated Systems............ 0.5
Oil Refining & Marketing................ 0.4
Wireless Equipment...................... 0.4
E-Commerce/Services..................... 0.4
Retail-Restaurants...................... 0.4
Electric-Integrated..................... 0.4
Appliances.............................. 0.4
Security Services....................... 0.4
Private Equity.......................... 0.4
Food-Meat Products...................... 0.4
Energy-Alternate Sources................ 0.4
Paper & Related Products................ 0.4
Publishing-Books........................ 0.4
Educational Software.................... 0.4
Finance-Auto Loans...................... 0.4
Oil Companies-Integrated................ 0.4
Hazardous Waste Disposal................ 0.4
Aerospace/Defense....................... 0.4
Printing-Commercial..................... 0.3
Motion Pictures & Services.............. 0.3
Retail-Convenience Store................ 0.3
Airport Development/Maintenance......... 0.3
Schools................................. 0.3
Instruments-Controls.................... 0.3
Electronic Components-Semiconductors.... 0.3
Computers............................... 0.3
Food-Baking............................. 0.3
Veterinary Diagnostics.................. 0.3
E-Commerce/Products..................... 0.3
Cruise Lines............................ 0.3
Data Processing/Management.............. 0.3
Retail-Propane Distribution............. 0.3
Retail-Building Products................ 0.3
Human Resources......................... 0.3
Diversified Financial Services.......... 0.3
Building & Construction-Misc............ 0.3
Diversified Manufacturing Operations.... 0.3
Retail-Vitamins & Nutrition Supplements. 0.3
Building-Maintenance & Services......... 0.3
Consumer Products-Misc.................. 0.3
Transport-Services...................... 0.3
Metal-Diversified....................... 0.3
Diversified Banking Institutions........ 0.2
Non-Hazardous Waste Disposal............ 0.2
47
AIG Flexible Credit Fund
PORTFOLIO PROFILE -- March 31, 2019 -- (unaudited) (continued)
Industry Allocation* (continued)
Athletic Equipment.............. 0.2%
Transport-Marine................ 0.2
Internet Gambling............... 0.2
Bicycle Manufacturing........... 0.2
Retail-Bedding.................. 0.2
Internet Connectivity Services.. 0.2
Gold Mining..................... 0.2
Retail-Automobile............... 0.2
Medical-Outpatient/Home Medical. 0.2
Metal Processors & Fabrication.. 0.2
Banks-Commercial................ 0.2
Gas-Distribution................ 0.2
Retail-Pet Food & Supplies...... 0.2
Chemicals-Other................. 0.2
Coal............................ 0.2
Medical Products................ 0.1
Pollution Control............... 0.1
Advertising Services............ 0.1
Vitamins & Nutrition Products... 0.1
Recycling....................... 0.1
Real Estate Management/Services. 0.1
Research & Development.......... 0.1
-----
104.4%
=====
Credit Quality+#
Baa........ 1.8%
Ba......... 21.1
B.......... 54.0
Caa........ 15.2
Ca......... 0.8
Not Rated@. 7.1
-----
100.0%
=====
--------
*Calculated as a percentage of net assets
+Source: Moody's
#Calculated as a percentage of total debt issues, excluding short-term
securities.
@Represents debt issues that either have no rating, or the rating is
unavailable from the data source.
48
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019
Principal Value
Security Description Amount (Note 2)
ASSET BACKED SECURITIES -- 0.3%
Diversified Financial Services -- 0.3%
TGIF Funding LLC
Series 2017 -1A, Class A2
6.20% due 04/30/2047*
(cost $857,213)......................... $ 887,800 $ 866,750
----------
U.S. CORPORATE BONDS & NOTES -- 36.2%
Aerospace/Defense-Equipment -- 0.6%
TransDigm, Inc.
Company Guar. Notes
6.38% due 06/15/2026.................... 745,000 737,438
TransDigm, Inc.
Company Guar. Notes
6.50% due 07/15/2024.................... 380,000 390,450
TransDigm, Inc.
Company Guar. Notes
6.50% due 05/15/2025.................... 600,000 609,060
----------
1,736,948
----------
Applications Software -- 0.3%
SS&C Technologies, Inc.
Company Guar. Notes
5.50% due 09/30/2027*................... 1,030,000 1,040,300
----------
Athletic Equipment -- 0.2%
Vista Outdoor, Inc.
Company Guar. Notes
5.88% due 10/01/2023.................... 810,000 753,300
----------
Auto-Heavy Duty Trucks -- 0.5%
Navistar International Corp.
Company Guar. Notes
6.63% due 11/01/2025*................... 1,435,000 1,458,319
----------
Banks-Commercial -- 0.2%
Synovus Financial Corp.
Sub. Notes
5.90% due 02/07/2029.................... 520,000 522,080
----------
Broadcast Services/Program -- 0.8%
Clear Channel Worldwide Holdings, Inc.
Company Guar. Notes
9.25% due 02/15/2024*................... 1,260,000 1,335,600
iHeartCommunications, Inc.
Senior Sec. Notes
9.00% due 12/15/2019+(1)(2)............. 690,000 489,900
Univision Communications, Inc.
Senior Sec. Notes
5.13% due 05/15/2023*................... 740,000 700,687
----------
2,526,187
----------
Building & Construction-Misc. -- 0.3%
Frontdoor, Inc.
Senior Notes
6.75% due 08/15/2026*................... 150,000 153,375
Weekley Homes LLC/Weekley Finance Corp.
Senior Notes
6.63% due 08/15/2025.................... 740,000 706,700
----------
860,075
----------
Principal Value
Security Description Amount (Note 2)
Building-Heavy Construction -- 0.3%
New Enterprise Stone & Lime Co., Inc.
Senior Notes
10.13% due 04/01/2022*....................... $ 805,000 $ 815,063
----------
Building-Residential/Commercial -- 1.8%
Beazer Homes USA, Inc.
Company Guar. Notes
5.88% due 10/15/2027......................... 560,000 488,600
Beazer Homes USA, Inc.
Company Guar. Notes
6.75% due 03/15/2025......................... 720,000 681,300
Lennar Corp.
Company Guar. Notes
5.25% due 06/01/2026......................... 815,000 838,431
M/I Homes, Inc.
Company Guar. Notes
5.63% due 08/01/2025......................... 730,000 698,975
PulteGroup, Inc.
Company Guar. Notes
5.50% due 03/01/2026......................... 660,000 679,800
TRI Pointe Group Inc./TRI Pointe Homes Inc.
Company Guar. Notes
5.88% due 06/15/2024......................... 1,475,000 1,482,375
William Lyon Homes, Inc.
Company Guar. Notes
6.00% due 09/01/2023......................... 700,000 677,250
----------
5,546,731
----------
Cable/Satellite TV -- 2.0%
Cablevision Systems Corp.
Senior Notes
5.88% due 09/15/2022......................... 1,255,000 1,311,475
CCO Holdings LLC/CCO Holdings Capital Corp.
Senior Notes
5.13% due 05/01/2027*........................ 825,000 830,156
Charter Communications Operating LLC/Charter
Communications Operating Capital
Senior Sec. Notes
4.50% due 02/01/2024......................... 1,675,000 1,742,185
CSC Holdings LLC
Senior Notes
7.50% due 04/01/2028*........................ 585,000 626,857
DISH DBS Corp.
Company Guar. Notes
5.00% due 03/15/2023......................... 1,465,000 1,318,500
DISH DBS Corp.
Company Guar. Notes
7.75% due 07/01/2026......................... 340,000 295,800
----------
6,124,973
----------
Casino Hotels -- 0.8%
Boyd Gaming Corp.
Company Guar. Notes
6.00% due 08/15/2026......................... 260,000 266,500
Boyd Gaming Corp.
Company Guar. Notes
6.38% due 04/01/2026......................... 1,615,000 1,671,525
49
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Casino Hotels (continued)
MGM Resorts International
Company Guar. Notes
5.75% due 06/15/2025............................... $615,000 $ 636,525
----------
2,574,550
----------
Casino Services -- 0.2%
Eldorado Resorts, Inc.
Company Guar. Notes
6.00% due 09/15/2026............................... 755,000 766,325
----------
Cellular Telecom -- 0.3%
Sprint Corp.
Company Guar. Notes
7.88% due 09/15/2023............................... 960,000 1,005,600
----------
Chemicals-Diversified -- 0.2%
Hexion, Inc.
Senior Sec. Notes
10.38% due 02/01/2022*............................. 495,000 414,563
Hexion, Inc.
Sec. Notes
13.75% due 02/01/2022*............................. 395,000 136,275
----------
550,838
----------
Chemicals-Specialty -- 0.7%
Cornerstone Chemical Co.
Senior Sec. Notes
6.75% due 08/15/2024*.............................. 795,000 747,300
Kraton Polymers LLC/Kraton Polymers Capital Corp.
Company Guar. Notes
7.00% due 04/15/2025*.............................. 835,000 843,350
Platform Specialty Products Corp.
Company Guar. Notes
5.88% due 12/01/2025*.............................. 630,000 632,268
----------
2,222,918
----------
Commercial Services -- 0.2%
ServiceMaster Co. LLC
Company Guar. Notes
5.13% due 11/15/2024*.............................. 620,000 622,325
----------
Computer Services -- 0.7%
Banff Merger Sub, Inc.
Senior Notes
9.75% due 09/01/2026*.............................. 530,000 514,100
Exela Intermediate LLC/Exela Finance, Inc.
Senior Sec. Notes
10.00% due 07/15/2023*............................. 980,000 997,885
West Corp.
Company Guar. Notes
8.50% due 10/15/2025*.............................. 640,000 550,400
----------
2,062,385
----------
Computers -- 0.3%
Dell International LLC/EMC Corp.
Senior Sec. Notes
4.90% due 10/01/2026*.............................. 495,000 502,430
Principal Value
Security Description Amount (Note 2)
Computers (continued)
Dell International LLC/EMC Corp.
Senior Sec. Notes
5.30% due 10/01/2029*................. $ 505,000 $ 509,434
----------
1,011,864
----------
Computers-Integrated Systems -- 0.1%
Everi Payments, Inc.
Company Guar. Notes
7.50% due 12/15/2025*................. 250,000 260,000
----------
Consumer Products-Misc. -- 0.3%
Prestige Brands, Inc.
Company Guar. Notes
6.38% due 03/01/2024*................. 775,000 788,563
----------
Containers-Metal/Glass -- 0.4%
Greif, Inc.
Company Guar. Notes
6.50% due 03/01/2027*................. 610,000 623,725
Owens-Brockway Glass Container, Inc.
Company Guar. Notes
6.38% due 08/15/2025*................. 665,000 699,912
----------
1,323,637
----------
Containers-Paper/Plastic -- 0.2%
Trident Merger Sub, Inc.
Senior Notes
6.63% due 11/01/2025*................. 790,000 738,650
----------
Diagnostic Equipment -- 0.9%
Avantor, Inc.
Senior Sec. Notes
6.00% due 10/01/2024*................. 1,155,000 1,198,313
Avantor, Inc.
Senior Notes
9.00% due 10/01/2025*................. 735,000 796,556
Ortho-Clinical Diagnostics, Inc.
Senior Notes
6.63% due 05/15/2022*................. 790,000 749,710
----------
2,744,579
----------
Dialysis Centers -- 0.2%
DaVita HealthCare Partners, Inc.
Company Guar. Notes
5.13% due 07/15/2024.................. 635,000 627,063
----------
Disposable Medical Products -- 0.3%
Sotera Health Holdings LLC
Senior Notes
6.50% due 05/15/2023*................. 900,000 906,750
----------
Diversified Manufacturing Operations -- 0.3%
LSB Industries, Inc.
Senior Sec. Notes
9.63% due 05/01/2023*................. 795,000 822,984
----------
E-Commerce/Services -- 0.1%
Match Group, Inc.
Senior Notes
5.63% due 02/15/2029*................. 410,000 415,125
----------
50
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Electric-Integrated -- 0.0%
Texas Competitive Electric Holdings Co. LLC/
TCEH Finance, Inc.
Escrow Notes
11.50% due 10/01/2020+........................ $1,667,835 $ 6,671
----------
Electronic Components-Semiconductors -- 0.3%
Amkor Technology, Inc.
Senior Notes
6.63% due 09/15/2027*......................... 1,010,000 1,025,150
----------
Energy-Alternate Sources -- 0.4%
TerraForm Power Operating LLC
Company Guar. Notes
4.25% due 01/31/2023*......................... 650,000 642,193
TerraForm Power Operating LLC
Company Guar. Notes
5.00% due 01/31/2028*......................... 590,000 569,350
----------
1,211,543
----------
Enterprise Software/Service -- 0.2%
Infor US, Inc.
Company Guar. Notes
6.50% due 05/15/2022.......................... 665,000 674,144
----------
Finance-Consumer Loans -- 1.7%
Navient Corp.
Senior Notes
5.88% due 10/25/2024.......................... 1,095,000 1,059,412
Navient Corp.
Senior Notes
6.75% due 06/25/2025.......................... 1,025,000 1,016,339
Springleaf Finance Corp.
Company Guar. Notes
6.13% due 05/15/2022.......................... 1,040,000 1,076,400
Springleaf Finance Corp.
Company Guar. Notes
6.88% due 03/15/2025.......................... 820,000 845,625
Springleaf Finance Corp.
Company Guar. Notes
7.13% due 03/15/2026.......................... 390,000 397,067
Synchrony Financial
Senior Notes
4.38% due 03/19/2024.......................... 935,000 947,056
----------
5,341,899
----------
Finance-Mortgage Loan/Banker -- 0.7%
Ladder Capital Finance Holdings LLLP/Ladder
Capital Finance Corp.
Company Guar. Notes
5.88% due 08/01/2021*......................... 1,235,000 1,258,156
Nationstar Mtg. Holdings, Inc.
Company Guar. Notes
8.13% due 07/15/2023*......................... 595,000 612,850
Nationstar Mtg. LLC/Nationstar Capital Corp.
Company Guar. Notes
6.50% due 07/01/2021.......................... 350,000 350,000
----------
2,221,006
----------
Principal Value
Security Description Amount (Note 2)
Food-Dairy Products -- 0.1%
Chobani LLC/Chobani Finance Corp., Inc.
Company Guar. Notes
7.50% due 04/15/2025*.......................... $ 355,000 $ 318,169
----------
Food-Misc./Diversified -- 0.8%
Dole Food Co., Inc.
Senior Sec. Notes
7.25% due 06/15/2025*.......................... 1,250,000 1,106,250
Matterhorn Merger Sub LLC/Matterhorn Finance
Sub, Inc.
Senior Notes
8.50% due 06/01/2026*.......................... 580,000 503,150
Post Holdings, Inc.
Company Guar. Notes
5.00% due 08/15/2026*.......................... 435,000 423,038
Post Holdings, Inc.
Company Guar. Notes
5.50% due 03/01/2025*.......................... 590,000 596,637
----------
2,629,075
----------
Food-Retail -- 0.3%
Albertsons Cos. LLC/Safeway, Inc./New
Albertsons LP/Albertson's LLC
Company Guar. Notes
5.75% due 03/15/2025........................... 705,000 668,868
Albertsons Cos. LLC/Safeway, Inc./New
Albertsons LP/Albertson's LLC
Company Guar. Notes
7.50% due 03/15/2026*.......................... 145,000 149,169
----------
818,037
----------
Gambling (Non-Hotel) -- 0.8%
Caesars Resort Collection LLC/CRC Finco, Inc.
Company Guar. Notes
5.25% due 10/15/2025*.......................... 1,160,000 1,117,219
Downstream Development Authority of the
Quapaw Tribe of Oklahoma
Senior Sec. Notes
10.50% due 02/15/2023*......................... 485,000 501,369
Scientific Games International, Inc.
Company Guar. Notes
6.63% due 05/15/2021........................... 440,000 443,300
Scientific Games International, Inc.
Company Guar. Notes
8.25% due 03/15/2026*.......................... 380,000 387,847
----------
2,449,735
----------
Gas-Distribution -- 0.2%
AmeriGas Partners LP/AmeriGas Finance Corp.
Senior Notes
5.50% due 05/20/2025........................... 510,000 508,088
----------
Hotels/Motels -- 0.2%
Hilton Domestic Operating Co., Inc.
Company Guar. Notes
5.13% due 05/01/2026*.......................... 460,000 467,723
----------
51
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Housewares -- 0.2%
American Greetings Corp.
Company Guar. Notes
8.75% due 04/15/2025*........................... $ 715,000 $ 647,075
----------
Independent Power Producers -- 0.6%
Calpine Corp.
Senior Notes
5.38% due 01/15/2023............................ 1,497,000 1,498,871
NRG Energy, Inc.
Company Guar. Notes
5.75% due 01/15/2028............................ 340,000 360,400
----------
1,859,271
----------
Insurance-Multi-line -- 0.3%
Acrisure LLC/Acrisure Finance, Inc.
Senior Notes
7.00% due 11/15/2025*........................... 710,000 639,000
Acrisure LLC/Acrisure Finance, Inc.
Senior Sec. Notes
8.13% due 02/15/2024*........................... 320,000 331,571
----------
970,571
----------
Internet Connectivity Services -- 0.2%
Zayo Group LLC/Zayo Capital, Inc.
Company Guar. Notes
6.38% due 05/15/2025............................ 600,000 603,000
----------
Machinery-Electrical -- 0.3%
Vertiv Intermediate Holding Corp.
Senior Notes
12.00% due 02/15/2022*(4)....................... 795,000 767,175
----------
Machinery-General Industrial -- 0.2%
RBS Global, Inc./Rexnord LLC
Company Guar. Notes
4.88% due 12/15/2025*........................... 775,000 765,313
----------
Medical Information Systems -- 0.1%
Change Healthcare Holdings LLC/Change
Healthcare Finance, Inc.
Senior Notes
5.75% due 03/01/2025*........................... 340,000 335,750
----------
Medical Labs & Testing Services -- 0.7%
Charles River Laboratories International, Inc.
Company Guar. Notes
5.50% due 04/01/2026*........................... 350,000 363,125
Eagle Holding Co. II LLC
Senior Notes
7.63% due 05/15/2022*(4)........................ 910,000 917,962
West Street Merger Sub, Inc.
Senior Notes
6.38% due 09/01/2025*........................... 810,000 787,725
----------
2,068,812
----------
Medical-Drugs -- 0.5%
Bausch Health Americas, Inc.
Company Guar. Notes
8.50% due 01/31/2027*........................... 1,305,000 1,383,300
Principal Value
Security Description Amount (Note 2)
Medical-Drugs (continued)
Endo Finance LLC/Endo Finco, Inc.
Company Guar. Notes
5.38% due 01/15/2023*.............. $ 350,000 $ 287,000
----------
1,670,300
----------
Medical-Generic Drugs -- 0.1%
Par Pharmaceutical, Inc.
Senior Sec. Notes
7.50% due 04/01/2027*.............. 405,000 410,670
----------
Medical-HMO -- 0.5%
Centene Corp.
Senior Notes
5.38% due 06/01/2026*.............. 195,000 203,531
MPH Acquisition Holdings LLC
Company Guar. Notes
7.13% due 06/01/2024*.............. 465,000 463,838
Polaris Intermediate Corp.
Senior Notes
8.50% due 12/01/2022*(4)........... 360,000 355,140
WellCare Health Plans, Inc.
Senior Notes
5.25% due 04/01/2025............... 450,000 465,750
----------
1,488,259
----------
Medical-Hospitals -- 2.0%
HCA, Inc.
Company Guar. Notes
5.38% due 02/01/2025............... 1,315,000 1,393,900
HCA, Inc.
Company Guar. Notes
5.63% due 09/01/2028............... 1,415,000 1,496,362
HCA, Inc.
Company Guar. Notes
5.88% due 02/01/2029............... 155,000 167,005
Surgery Center Holdings, Inc.
Company Guar. Notes
8.88% due 04/15/2021*.............. 360,000 377,028
Surgery Center Holdings, Inc.
Company Guar. Notes
10.00% due 04/15/2027*............. 425,000 431,375
Tenet Healthcare Corp.
Sec. Notes
5.13% due 05/01/2025............... 285,000 286,439
Tenet Healthcare Corp.
Sec. Notes
6.25% due 02/01/2027*.............. 495,000 513,835
Tenet Healthcare Corp.
Senior Notes
7.00% due 08/01/2025............... 1,105,000 1,117,089
Tenet Healthcare Corp.
Senior Notes
8.13% due 04/01/2022............... 365,000 392,685
----------
6,175,718
----------
Metal Processors & Fabrication -- 0.2%
Hillman Group, Inc.
Company Guar. Notes
6.38% due 07/15/2022*.............. 585,000 523,575
----------
52
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Oil & Gas Drilling -- 0.3%
Nabors Industries, Inc.
Company Guar. Notes
5.75% due 02/01/2025............................. $ 535,000 $ 479,483
Rowan Cos., Inc.
Company Guar. Notes
5.40% due 12/01/2042............................. 875,000 538,125
----------
1,017,608
----------
Oil Companies-Exploration & Production -- 2.0%
California Resources Corp.
Sec. Notes
8.00% due 12/15/2022*............................ 870,000 683,211
Callon Petroleum Co.
Company Guar. Notes
6.13% due 10/01/2024............................. 451,345 453,602
Chesapeake Energy Corp.
Company Guar. Notes
8.00% due 06/15/2027............................. 965,000 950,525
CrownRock LP/CrownRock Finance, Inc.
Senior Notes
5.63% due 10/15/2025*............................ 1,015,000 974,400
Denbury Resources, Inc.
Sec. Notes
7.50% due 02/15/2024*............................ 580,000 495,175
Denbury Resources, Inc.
Sec. Notes
9.25% due 03/31/2022*............................ 768,000 741,120
EP Energy LLC/Everest Acquisition Finance, Inc.
Senior Sec. Notes
7.75% due 05/15/2026*............................ 180,000 146,250
EP Energy LLC/Everest Acquisition Finance, Inc.
Senior Sec. Notes
8.00% due 11/29/2024*............................ 170,000 94,350
EP Energy LLC/Everest Acquisition Finance, Inc.
Sec. Bonds
8.00% due 02/15/2025*............................ 260,000 89,700
Kosmos Energy, Ltd.
Company Guar. Notes
7.13% due 04/04/2026*............................ 600,000 594,600
Range Resources Corp.
Company Guar. Notes
5.00% due 03/15/2023............................. 350,000 343,000
Sanchez Energy Corp.
Senior Sec. Notes
7.25% due 02/15/2023*............................ 405,000 326,025
Vine Oil & Gas LP/Vine Oil & Gas Finance Corp.
Company Guar. Notes
8.75% due 04/15/2023*............................ 575,000 457,125
----------
6,349,083
----------
Oil Refining & Marketing -- 0.1%
Citgo Holding, Inc.
Senior Sec. Notes
10.75% due 02/15/2020*........................... 430,000 440,836
----------
Principal Value
Security Description Amount (Note 2)
Oil-Field Services -- 0.4%
CSI Compressco LP/CSI Compressco Finance, Inc.
Company Guar. Notes
7.25% due 08/15/2022................................. $ 370,000 $ 323,750
USA Compression Partners LP/USA Compression
Finance Corp.
Company Guar. Notes
6.88% due 04/01/2026................................. 905,000 928,756
----------
1,252,506
----------
Paper & Related Products -- 0.2%
Schweitzer-Mauduit International, Inc.
Company Guar. Notes
6.88% due 10/01/2026*................................ 675,000 675,000
----------
Pipelines -- 1.1%
American Midstream Partners LP/American
Midstream Finance Corp.
Company Guar. Notes
9.50% due 12/15/2021*................................ 525,000 483,000
Cheniere Corpus Christi Holdings LLC
Senior Sec. Notes
5.88% due 03/31/2025................................. 1,065,000 1,158,188
Cheniere Energy Partners LP
Company Guar. Notes
5.63% due 10/01/2026*................................ 665,000 681,625
Energy Transfer Operating LP
Company Guar. Notes
7.50% due 10/15/2020................................. 436,000 464,194
Targa Resources Partners LP/Targa Resources
Partners Finance Corp.
Company Guar. Notes
5.88% due 04/15/2026*................................ 485,000 512,645
----------
3,299,652
----------
Private Equity -- 0.4%
Icahn Enterprises LP/Icahn Enterprises Finance Corp.
Company Guar. Notes
5.88% due 02/01/2022................................. 985,000 997,312
Icahn Enterprises LP/Icahn Enterprises Finance Corp.
Company Guar. Notes
6.38% due 12/15/2025................................. 285,000 291,769
----------
1,289,081
----------
Publishing-Books -- 0.1%
McGraw-Hill Global Education Holdings LLC/
McGraw-Hill Global Education Finance
Senior Notes
7.88% due 05/15/2024*................................ 500,000 400,000
----------
Publishing-Periodicals -- 0.3%
Meredith Corp.
Company Guar. Notes
6.88% due 02/01/2026................................. 1,000,000 1,050,000
----------
Real Estate Investment Trusts -- 1.4%
ESH Hospitality, Inc.
Company Guar. Notes
5.25% due 05/01/2025*................................ 1,070,000 1,062,863
53
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Real Estate Investment Trusts (continued)
iStar, Inc.
Senior Notes
5.25% due 09/15/2022..................................... $1,170,000 $1,148,063
MGM Growth Properties Operating Partnership
LP/MGP Finance Co-Issuer, Inc.
Company Guar. Notes
4.50% due 01/15/2028..................................... 580,000 545,200
MGM Growth Properties Operating Partnership
LP/MGP Finance Co-Issuer, Inc.
Company Guar. Notes
5.63% due 05/01/2024..................................... 330,000 343,200
MGM Growth Properties Operating Partnership
LP/MGP Finance Co-Issuer, Inc.
Company Guar. Notes
5.75% due 02/01/2027*.................................... 370,000 382,950
MPT Operating Partnership LP/MPT Finance Corp.
Company Guar. Notes
5.00% due 10/15/2027..................................... 400,000 407,000
Uniti Group, Inc./CSL Capital LLC
Company Guar. Notes
7.13% due 12/15/2024*.................................... 595,000 511,700
----------
4,400,976
----------
Real Estate Management/Services -- 0.1%
Realogy Group LLC/Realogy Co-Issuer Corp.
Company Guar. Notes
9.38% due 04/01/2027*.................................... 245,000 250,819
----------
Retail-Automobile -- 0.2%
Sonic Automotive, Inc.
Company Guar. Notes
6.13% due 03/15/2027..................................... 600,000 544,500
----------
Retail-Convenience Store -- 0.3%
Cumberland Farms, Inc.
Senior Notes
6.75% due 05/01/2025*.................................... 1,025,000 1,066,000
----------
Retail-Major Department Stores -- 0.1%
Neiman Marcus Group, Ltd. LLC
Company Guar. Notes
8.00% due 10/15/2021*.................................... 695,000 368,350
----------
Retail-Propane Distribution -- 0.3%
Ferrellgas Partners LP/Ferrellgas Partners Finance Corp.
Senior Notes
8.63% due 06/15/2020..................................... 570,000 430,350
Suburban Propane Partners LP/Suburban Energy
Finance Corp.
Senior Notes
5.50% due 06/01/2024..................................... 490,000 477,309
----------
907,659
----------
Retail-Restaurants -- 0.4%
Golden Nugget, Inc.
Senior Notes
6.75% due 10/15/2024*.................................... 895,000 899,475
Principal Value
Security Description Amount (Note 2)
Retail-Restaurants (continued)
Golden Nugget, Inc.
Company Guar. Notes
8.75% due 10/01/2025*...................... $455,000 $ 477,750
----------
1,377,225
----------
Rubber/Plastic Products -- 0.0%
Venture Holdings Co. LLC
Company Guar. Notes
11.00% due 06/01/2007+(2)(6)(7)............ 550,000 0
----------
Security Services -- 0.1%
Prime Security Services Borrower LLC/Prime
Finance, Inc.
Senior Sec. Notes
5.25% due 04/15/2024*...................... 165,000 165,000
Prime Security Services Borrower LLC/Prime
Finance, Inc.
Senior Sec. Notes
5.75% due 04/15/2026*...................... 85,000 85,018
----------
250,018
----------
Soap & Cleaning Preparation -- 0.2%
Kronos Acquisition Holdings, Inc.
Company Guar. Notes
9.00% due 08/15/2023*...................... 720,000 619,200
----------
Steel-Producers -- 0.4%
AK Steel Corp.
Company Guar. Notes
7.00% due 03/15/2027....................... 585,000 490,113
United States Steel Corp.
Senior Notes
6.25% due 03/15/2026....................... 715,000 666,737
----------
1,156,850
----------
Telecommunication Equipment -- 0.3%
CommScope Finance LLC
Senior Notes
8.25% due 03/01/2027*...................... 920,000 954,500
----------
Telephone-Integrated -- 1.3%
Cincinnati Bell, Inc.
Company Guar. Notes
7.00% due 07/15/2024*...................... 535,000 492,510
Consolidated Communications, Inc.
Company Guar. Notes
6.50% due 10/01/2022....................... 970,000 868,150
Frontier Communications Corp.
Senior Notes
7.63% due 04/15/2024....................... 835,000 457,163
Frontier Communications Corp.
Senior Notes
8.50% due 04/15/2020....................... 740,000 723,350
Frontier Communications Corp.
Sec. Notes
8.50% due 04/01/2026*...................... 295,000 274,350
Level 3 Financing, Inc.
Company Guar. Notes
5.25% due 03/15/2026....................... 530,000 528,675
54
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
U.S. CORPORATE BONDS & NOTES (continued)
Telephone-Integrated (continued)
Level 3 Financing, Inc.
Company Guar. Notes
5.38% due 01/15/2024....................... $ 670,000 $ 682,462
------------
4,026,660
------------
Television -- 0.1%
Sinclair Television Group, Inc.
Company Guar. Notes
5.13% due 02/15/2027*...................... 250,000 239,375
------------
Theaters -- 0.4%
Live Nation Entertainment, Inc.
Company Guar. Notes
5.63% due 03/15/2026*...................... 1,130,000 1,166,725
------------
Transport-Equipment & Leasing -- 0.5%
Fortress Transportation & Infrastructure
Investors LLC
Senior Notes
6.50% due 10/01/2025*...................... 980,000 967,750
Fortress Transportation & Infrastructure
Investors LLC
Senior Notes
6.75% due 03/15/2022*...................... 670,000 681,725
------------
1,649,475
------------
Wireless Equipment -- 0.4%
ViaSat, Inc.
Senior Notes
5.63% due 09/15/2025*...................... 815,000 780,362
ViaSat, Inc.
Senior Sec. Notes
5.63% due 04/15/2027*...................... 595,000 605,478
------------
1,385,840
------------
Total U.S. Corporate Bonds & Notes
(cost $115,385,210)........................ 112,922,799
------------
FOREIGN CORPORATE BONDS & NOTES -- 7.1%
Aerospace/Defense -- 0.4%
Bombardier, Inc.
Senior Notes
7.50% due 12/01/2024*...................... 675,000 701,156
Bombardier, Inc.
Senior Notes
7.88% due 04/15/2027*...................... 365,000 376,516
------------
1,077,672
------------
Auto/Truck Parts & Equipment-Original -- 0.2%
Panther BF Aggregator 2 LP/Panther Finance
Co., Inc.
Senior Sec. Notes
6.25% due 05/15/2026*...................... 60,000 61,200
Panther BF Aggregator 2 LP/Panther Finance
Co., Inc.
Company Guar. Notes
8.50% due 05/15/2027*...................... 695,000 696,737
------------
757,937
------------
Principal Value
Security Description Amount (Note 2)
Building & Construction Products-Misc. -- 0.2%
James Hardie International Finance DAC
Company Guar. Notes
4.75% due 01/15/2025*.......................... $ 655,000 $ 645,175
----------
Cable/Satellite TV -- 0.1%
Altice Luxembourg SA
Company Guar. Notes
7.75% due 05/15/2022*.......................... 300,000 300,000
----------
Casino Services -- 0.3%
Gateway Casinos & Entertainment, Ltd.
Sec. Notes
8.25% due 03/01/2024*.......................... 800,000 835,000
----------
Cellular Telecom -- 0.4%
Numericable-SFR SA
Senior Sec. Notes
7.38% due 05/01/2026*.......................... 1,200,000 1,176,000
----------
Chemicals-Diversified -- 0.3%
NOVA Chemicals Corp.
Senior Notes
4.88% due 06/01/2024*.......................... 440,000 432,300
NOVA Chemicals Corp.
Senior Notes
5.00% due 05/01/2025*.......................... 630,000 617,400
----------
1,049,700
----------
Chemicals-Specialty -- 0.3%
Alpha 3 BV/Alpha US Bidco, Inc.
Company Guar. Notes
6.25% due 02/01/2025*.......................... 950,000 916,750
----------
Containers-Metal/Glass -- 0.7%
ARD Securities Finance SARL
Senior Sec. Notes
8.75% due 01/31/2023*(8)....................... 605,750 572,434
Ardagh Packaging Finance PLC/Ardagh Holdings
USA, Inc.
Company Guar. Notes
6.00% due 02/15/2025*.......................... 1,520,000 1,520,000
----------
2,092,434
----------
Cruise Lines -- 0.3%
Viking Cruises, Ltd.
Company Guar. Notes
5.88% due 09/15/2027*.......................... 985,000 958,405
----------
Diversified Minerals -- 0.2%
FMG Resources August 2006 Pty, Ltd.
Company Guar. Notes
5.13% due 03/15/2023*.......................... 715,000 718,575
----------
Gold Mining -- 0.2%
Eldorado Gold Corp.
Company Guar. Notes
6.13% due 12/15/2020*.......................... 595,000 582,326
----------
Machinery-Pumps -- 0.1%
Titan Acquisition, Ltd./Titan Co-Borrower LLC
Senior Notes
7.75% due 04/15/2026*.......................... 455,000 392,438
----------
55
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
FOREIGN CORPORATE BONDS & NOTES (continued)
Medical-Biomedical/Gene -- 0.0%
Concordia International Corp.
Senior Sec. Notes
8.00% due 09/06/2024............................ $ 142,000 $ 133,480
----------
Medical-Drugs -- 0.8%
Bausch Health Cos., Inc.
Senior Sec. Notes
5.50% due 11/01/2025*........................... 1,180,000 1,205,075
Bausch Health Cos., Inc.
Senior Sec. Notes
5.75% due 08/15/2027*........................... 100,000 102,530
Bausch Health Cos., Inc.
Company Guar. Notes
9.00% due 12/15/2025*........................... 385,000 418,226
Teva Pharmaceutical Finance Netherlands III BV
Company Guar. Notes
3.15% due 10/01/2026............................ 505,000 412,579
Teva Pharmaceutical Finance Netherlands III BV
Company Guar. Notes
6.75% due 03/01/2028............................ 330,000 332,677
----------
2,471,087
----------
Medical-Generic Drugs -- 0.2%
Perrigo Finance Unlimited Co.
Company Guar. Notes
4.38% due 03/15/2026............................ 700,000 682,109
----------
Metal-Diversified -- 0.3%
Vedanta Resources PLC
Senior Notes
6.38% due 07/30/2022*........................... 805,000 781,011
----------
Oil & Gas Drilling -- 0.3%
Transocean, Inc.
Company Guar. Notes
6.80% due 03/15/2038............................ 465,000 360,375
Transocean, Inc.
Company Guar. Notes
7.50% due 01/15/2026*........................... 335,000 330,813
Transocean, Inc.
Company Guar. Notes
9.00% due 07/15/2023*........................... 265,000 282,556
----------
973,744
----------
Oil Companies-Exploration & Production -- 0.3%
Geopark, Ltd.
Senior Sec. Notes
6.50% due 09/21/2024*........................... 995,000 998,731
----------
Oil Companies-Integrated -- 0.4%
Petrobras Global Finance BV
Company Guar. Notes
5.30% due 01/27/2025............................ 460,000 466,675
Petrobras Global Finance BV
Company Guar. Notes
5.75% due 02/01/2029............................ 340,000 336,770
Principal Value
Security Description Amount (Note 2)
Oil Companies-Integrated (continued)
Petroleos Mexicanos
Company Guar. Notes
5.35% due 02/12/2028......................... $ 340,000 $ 315,520
-----------
1,118,965
-----------
Oil-Field Services -- 0.1%
Weatherford International, Ltd.
Company Guar. Notes
8.25% due 06/15/2023......................... 575,000 406,812
-----------
Paper & Related Products -- 0.2%
Cascades, Inc.
Company Guar. Notes
5.50% due 07/15/2022*........................ 150,000 150,750
Cascades, Inc.
Company Guar. Notes
5.75% due 07/15/2023*........................ 360,000 359,100
-----------
509,850
-----------
Security Services -- 0.3%
Garda World Security Corp.
Senior Notes
8.75% due 05/15/2025*........................ 1,115,000 1,059,250
-----------
Special Purpose Entity -- 0.0%
Hellas Telecommunications Luxembourg II SCA
Sub. Notes
6.05% due 01/15/2015+*(2)(6)(7).............. 1,025,000 0
-----------
Steel-Producers -- 0.3%
ArcelorMittal
Senior Notes
6.26% due 06/01/2025......................... 715,000 791,198
-----------
Transport-Marine -- 0.2%
Topaz Marine SA
Company Guar. Notes
9.13% due 07/26/2022*........................ 740,000 749,503
-----------
Total Foreign Corporate Bonds & Notes
(cost $23,569,022)........................... 22,178,152
-----------
LOANS(9)(10)(11) -- 50.9%
Advertising Services -- 0.1%
Advantage Sales & Marketing, Inc. FRS
1st Lien
5.75% (1 ML+3.25%)
due 07/23/2021............................... 357,513 302,769
-----------
Aerospace/Defense-Equipment -- 0.1%
TransDigm, Inc. FRS
BTL-F
5.00% (1 ML+2.50%)
due 06/09/2023............................... 463,322 451,739
-----------
Airport Development/Maintenance -- 0.3%
Dynasty Acquisition Co., Inc. FRS
BTL-B
coupon TBD
due 04/06/2026............................... 682,867 682,623
56
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
LOANS(9)(10)(11) (continued)
Airport Development/Maintenance (continued)
Standard Aero, Ltd. FRS
BTL
coupon TBD
due 04/06/2026................... $ 367,133 $ 367,002
----------
1,049,625
----------
Appliances -- 0.4%
Global Appliance, Inc. FRS
BTL-B
6.50% (1 ML+4.00%)
due 09/29/2024................... 1,334,000 1,313,990
----------
Applications Software -- 0.4%
SS&C European Holdings SARL FRS
BTL-B4
4.75% (1 ML+2.25%)
due 04/16/2025................... 491,735 487,022
SS&C Technologies, Inc. FRS
BTL-B3
4.75% (1 ML+2.25%)
due 04/16/2025................... 683,917 677,363
----------
1,164,385
----------
Auto-Heavy Duty Trucks -- 0.5%
Navistar, Inc. FRS
BTL-B
6.00% (1 ML+3.50%)
due 11/06/2024................... 1,450,350 1,442,493
----------
Auto/Truck Parts & Equipment-Original -- 1.4%
Accuride Corp. FRS
BTL
7.85% (3 ML+5.25%)
due 11/17/2023................... 1,169,583 964,906
DexKo Global, Inc. FRS
BTL-B
6.00% (1 ML+3.50%)
due 07/24/2024................... 968,482 950,928
Panther BF Aggregator 2 LP FRS
BTL-B
coupon TBD
due 03/18/2026................... 910,000 899,762
Tenneco, Inc. FRS
BTL-B
5.24% (1 ML+2.75%)
due 10/01/2025................... 1,625,925 1,550,726
----------
4,366,322
----------
Bicycle Manufacturing -- 0.2%
SRAM LLC FRS
1st Lein
5.31%-5.33% (2 ML+2.75%)
due 03/15/2024................... 712,541 708,088
SRAM LLC FRS
1st Lein
7.25% (USFRBPLR+1.75%)
due 03/15/2024................... 18,142 18,029
----------
726,117
----------
Broadcast Services/Program -- 0.9%
iHeartCommunications, Inc. FRS
BTL-D-EXT
6.75% due 01/30/2019+(1)(2)...... 1,555,000 1,105,994
Principal Value
Security Description Amount (Note 2)
Broadcast Services/Program (continued)
Univision Communications, Inc. FRS
1st Lein
5.25% (1 ML+2.75%)
due 03/15/2024...................... $1,797,946 $1,691,353
----------
2,797,347
----------
Building & Construction Products-Misc. -- 1.1%
AZEK Co. LLC FRS
BTL
6.63% (6 ML+3.75%)
due 05/05/2024...................... 3,465,611 3,430,955
----------
Building Products-Cement -- 0.9%
Quikrete Holdings, Inc. FRS
1st Lein
5.25% (1 ML+2.75%)
due 11/15/2023...................... 1,011,136 982,487
Summit Materials LLC FRS
BTL
4.50% (1 ML+2.00%)
due 11/21/2024...................... 1,768,545 1,728,753
----------
2,711,240
----------
Building-Heavy Construction -- 0.5%
Brand Industrial Services, Inc. FRS
BTL
6.81%-7.01% (3 ML+4.25%)
due 06/21/2024...................... 783,850 750,536
Brand Industrial Services, Inc. FRS
BTL
6.90% (2 ML+4.25%)
due 06/21/2024...................... 684,988 655,876
----------
1,406,412
----------
Building-Maintenance & Services -- 0.3%
Allied Universal Holdco LLC FRS
1st Lein
6.75% (1 ML+4.25%)
due 07/28/2022...................... 837,900 816,952
----------
Building-Residential/Commercial -- 0.0%
TOUSA, Inc.
Escrow Loans
12.25% due 08/15/2011+(6)........... 2,037,810 0
----------
Cable/Satellite TV -- 0.7%
Altice France SA FRS
BTL-B13
6.48% (1 ML+4.00%)
due 08/14/2026...................... 648,375 618,658
CSC Holdings LLC FRS
BTL
4.73% (1 ML+2.25%)
due 01/15/2026...................... 710,000 686,925
Radiate Holdco LLC FRS
BTL
5.50% (1 ML+3.00%)
due 02/01/2024...................... 912,799 890,550
----------
2,196,133
----------
Casino Hotels -- 1.1%
Caesars Resort Collection LLC FRS
BTL-B
5.25% (1 ML+2.75%)
due 12/22/2024...................... 1,720,195 1,699,000
57
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
LOANS(9)(10)(11) (continued)
Casino Hotels (continued)
CityCenter Holdings LLC FRS
BTL-B
4.75% (1 ML+2.25%)
due 04/18/2024............................ $1,314,355 $1,285,877
Golden Nugget, Inc. FRS
BTL-B
5.23%-5.25% (1 ML+2.75%)
due 10/04/2023............................ 589,050 582,423
----------
3,567,300
----------
Casino Services -- 0.7%
CBAC Borrower LLC FRS
BTL-B
6.50% (1 ML+4.00%)
due 07/07/2024............................ 699,350 693,231
Gateway Casinos & Entertainment Ltd. FRS
BTL
5.60% (3 ML+3.00%)
due 12/01/2023............................ 545,875 543,487
Stars Group Holdings FRS
BTL
6.10% (3 ML+3.50%)
due 07/10/2025............................ 347,230 346,199
Stars Group Holdings FRS
BTL
coupon TBD
due 07/10/2025............................ 618,397 616,561
----------
2,199,478
----------
Chemicals-Diversified -- 0.1%
New Arclin US Holding Corp. FRS
1st Lein
6.00% (1 ML+3.50%)
due 02/14/2024............................ 472,866 468,138
----------
Chemicals-Other -- 0.2%
US Salt LLC FRS
BTL-B
7.23% (3 ML+4.75%)
due 01/16/2026............................ 475,000 474,406
----------
Chemicals-Specialty -- 0.8%
Kraton Polymers LLC FRS
BTL
5.00% (1 ML+2.50%)
due 03/05/2025............................ 298,202 295,407
OMNOVA Solutions, Inc. FRS
BTL-B2
5.75% (1 ML+3.25%)
due 08/25/2023............................ 1,358,207 1,337,834
Platform Specialty Products Corp. FRS
BTL
4.75% (1 ML+2.25%)
due 01/30/2026............................ 902,738 894,086
----------
2,527,327
----------
Coal -- 0.2%
Lightstone Generation LLC FRS
BTL-C
6.25% (1 ML+3.75%)
due 01/30/2024............................ 26,117 25,282
Principal Value
Security Description Amount (Note 2)
Coal (continued)
Lightstone Generation LLC FRS
BTL-B
6.25% (1 ML+3.75%)
due 01/30/2024.......................... $ 463,045 $ 448,245
----------
473,527
----------
Commercial Services -- 0.6%
Atlantic Aviation FBO, Inc. FRS
BTL-B
6.25% (3 ML+ 3.75%)
due 12/06/2025.......................... 224,438 225,840
CPI Acquisition, Inc. FRS
1st Lein
7.35% (3 ML+4.50%)
due 08/17/2022.......................... 2,240,685 1,490,056
ServiceMaster Co. LLC FRS
BTL-C
4.99% (1 ML+2.50%)
due 11/08/2023.......................... 181,246 180,510
----------
1,896,406
----------
Commercial Services-Finance -- 0.5%
Financial & Risk US Holdings, Inc. FRS
BTL
6.25% (1 ML+3.75%)
due 10/01/2025.......................... 1,396,500 1,353,732
Trans Union LLC FRS
BTL-B4
4.50% (1 ML+2.00%)
due 06/19/2025.......................... 282,863 278,885
----------
1,632,617
----------
Computer Services -- 0.5%
Presidio LLC FRS
BTL-B
5.25% (1 ML+2.75%)
due 02/02/2024.......................... 7,415 7,309
Presidio LLC FRS
BTL-B
5.55% (3 ML+2.75%)
due 02/02/2024.......................... 564,773 556,654
Tempo Acquisition LLC FRS
BTL-B
5.50% (1 ML+3.00%)
due 05/01/2024.......................... 967,763 957,783
----------
1,521,746
----------
Computer Software -- 1.2%
Rackspace Hosting, Inc. FRS
1st Lien
5.74% (3 ML+3.00%)
due 11/03/2023.......................... 896,568 837,170
Vertafore, Inc. FRS
1st Lein
5.75% (3 ML+3.25%)
due 07/02/2025.......................... 2,872,800 2,818,217
----------
3,655,387
----------
58
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
LOANS(9)(10)(11) (continued)
Computers-Integrated Systems -- 0.4%
Everi Payments, Inc. FRS
BTL-B
5.50% (1 ML+3.00%)
due 05/09/2024............................ $1,134,788 $1,126,277
----------
Consulting Services -- 0.5%
AlixPartners LLP FRS
BTL
5.25% (1 ML+2.75%)
due 04/04/2024............................ 1,696,786 1,685,120
----------
Containers-Metal/Glass -- 1.0%
Anchor Glass Container Corp. FRS
1st Lien
5.23%-5.25% (1 ML+2.75%)
due 12/07/2023............................ 578,732 462,262
Anchor Glass Container Corp. FRS
2nd Lien
10.23% (1 ML+7.75%)
due 12/07/2024............................ 796,000 433,820
Berlin Packaging LLC FRS
1st Lein
5.49%-5.50% (1 ML+3.00%)
due 11/07/2025............................ 974,172 941,816
Berlin Packaging LLC FRS
1st Lein
5.50% (3 ML+3.00%)
due 11/07/2025............................ 23,291 22,517
BWAY Corp. FRS
BTL
6.03% (3 ML+3.25%)
due 04/03/2024............................ 1,247,775 1,215,021
----------
3,075,436
----------
Containers-Paper/Plastic -- 1.1%
Klockner Pentaplast of America, Inc. FRS
BTL
6.75% (1 ML+4.25%)
due 06/30/2022............................ 1,940,450 1,705,171
Reynolds Group Holdings, Inc. FRS
BTL
5.25% (1 ML+2.75%)
due 02/05/2023............................ 1,100,848 1,086,497
Trident TPI Holdings, Inc. FRS
BTL-B1
5.75% (1 ML+3.25%)
due 10/17/2024............................ 617,868 595,470
----------
3,387,138
----------
Cosmetics & Toiletries -- 0.5%
Parfums Holding Co., Inc. FRS
1st Lein
6.88% (3 ML+4.25%)
due 06/30/2024............................ 1,100,465 1,081,666
Revlon Consumer Products Corp. FRS
BTL-B
6.10%-6.13% (3 ML+3.50%)
due 09/07/2023............................ 809,957 583,979
----------
1,665,645
----------
Principal Value
Security Description Amount (Note 2)
Data Processing/Management -- 0.3%
Dun & Bradstreet Corp. FRS
BTL
7.49% (1 ML+5.00)
due 02/08/2026....................................... $ 955,000 $ 945,052
----------
Diagnostic Kits -- 0.5%
Ortho-Clinical Diagnostics SA FRS
BTL
5.75% (1 ML+3.25%)
due 06/30/2025....................................... 1,676,350 1,612,788
----------
Dialysis Centers -- 0.4%
U.S. Renal Care, Inc. FRS
1st Lien
6.85% (3 ML+4.25%)
due 12/30/2022....................................... 1,145,528 1,142,378
----------
Direct Marketing -- 0.5%
Red Ventures LLC FRS
BTL-B1
5.50% (1 ML+3.00%)
due 11/08/2024....................................... 1,638,280 1,623,262
----------
Disposable Medical Products -- 0.2%
Sterigenics-Nordion Holdings LLC FRS
BTL
5.50% (1 ML+3.00%)
due 05/15/2022....................................... 656,198 642,254
----------
Distribution/Wholesale -- 0.9%
American Builders & Contractors Supply Co., Inc. FRS
BTL-B2
4.50% (1 ML+2.00%)
due 10/31/2023....................................... 1,112,379 1,080,001
Patriot Container Corp. FRS
1st Lein
6.00% (1 ML+3.50%)
due 03/20/2025....................................... 381,150 377,338
Spin Holdco, Inc. FRS
BTL-B1
6.03% (3 ML+3.25%)
due 11/14/2022....................................... 628,326 609,084
Univar USA, Inc. FRS
BTL-B3
4.75% (1 ML+2.25%)
due 07/01/2024....................................... 784,671 774,863
----------
2,841,286
----------
Diversified Minerals -- 0.3%
Covia Holdings Corp. FRS
BTL
6.16% (3 ML+3.75%)
due 06/01/2025....................................... 936,940 796,008
----------
E-Commerce/Products -- 0.3%
Rodan & Fields LLC FRS
BTL
8.50% (1 ML+4.00%)
due 06/06/2025....................................... 1,141,375 987,289
----------
59
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
LOANS(9)(10)(11) (continued)
E-Commerce/Services -- 0.3%
Hoya Midco LLC FRS
1st Lein
6.00% (1 ML+3.50%)
due 06/30/2024................. $ 997,188 $ 962,910
----------
Educational Software -- 0.4%
Blackboard, Inc. FRS
BTL-B4
7.78% (3 ML+5.00%)
due 06/30/2021................. 1,186,315 1,163,577
----------
Electric-Generation -- 0.7%
APLP Holdings LP FRS
BTL-B
5.25% (1 ML+2.75%)
due 04/13/2023................. 882,429 880,222
TEX Operations Co. LLC FRS
BTL
4.50% (1 ML+2.00%)
due 08/04/2023................. 766,041 756,465
Vistra Operations Co. LLC FRS
BTL
4.48%-4.50% (1 ML+2.00%)
due 12/31/2025................. 575,650 566,440
----------
2,203,127
----------
Electric-Integrated -- 0.4%
Talen Energy Supply LLC FRS
BTL-B1
6.50% (1 ML+4.00%)
due 07/15/2023................. 607,059 600,381
Talen Energy Supply LLC FRS
BTL
6.50% (1 ML+4.00%)
due 04/15/2024................. 730,500 722,890
----------
1,323,271
----------
Enterprise Software/Service -- 1.8%
Applied Systems, Inc. FRS
1st Lein
5.50% (1 ML+3.00%)
due 09/19/2024................. 296,694 292,490
Applied Systems, Inc. FRS
2nd Lien
9.50% (1 ML+7.00%)
due 09/19/2025................. 205,000 206,409
Banff Merger Sub, Inc. FRS
BTL
6.85% (3 ML+4.25%)
due 10/02/2025................. 2,448,863 2,395,600
Kronos, Inc. FRS
1st Lien
5.74% (3 ML+3.00%)
due 11/01/2023................. 2,167,849 2,142,106
Kronos, Inc. FRS
2nd Lien
10.99% (3 ML+8.25%)
due 11/01/2024................. 440,000 445,186
----------
5,481,791
----------
Finance-Auto Loans -- 0.4%
Capital Automotive LP FRS
1st Lein
5.00% (1 ML+2.50%)
due 03/24/2024................. 305,177 300,854
Principal Value
Security Description Amount (Note 2)
Finance-Auto Loans (continued)
Capital Automotive LP FRS
2nd Lien
8.50% (1 ML+6.00%)
due 03/24/2025.......................... $ 855,674 $ 849,256
----------
1,150,110
----------
Finance-Credit Card -- 1.0%
Blackhawk Network Holdings LLC FRS
1st Lien
5.50% (1 ML+3.00%)
due 06/15/2025.......................... 1,305,138 1,279,688
Pi US Mergerco, Inc. FRS
BTL-B1
6.00% (1 ML+3.50%)
due 12/20/2024.......................... 1,956,572 1,917,440
----------
3,197,128
----------
Finance-Mortgage Loan/Banker -- 0.5%
Walter Investment Management Corp. FRS
BTL-B
8.52% due 06/30/2022+(1)(2)............. 2,121,593 1,442,684
----------
Food-Baking -- 0.3%
Hostess Brands LLC FRS
BTL-B
4.75% (1 ML+2.25%)
due 08/03/2022.......................... 422,614 409,672
Hostess Brands LLC FRS
BTL-B
4.99% (3 ML+2.25%)
due 08/03/2022.......................... 614,207 595,397
----------
1,005,069
----------
Food-Dairy Products -- 0.5%
Chobani LLC FRS
1st Lein
6.00% (1 ML+3.50%)
due 10/10/2023.......................... 719,251 685,986
Milk Specialties Co. FRS
BTL
6.50% (1 ML+4.00%)
due 08/16/2023.......................... 981,738 976,830
----------
1,662,816
----------
Food-Flour & Grain -- 0.0%
C.H. Guenther & Son, Inc. FRS
1st Lein
5.25% (1 ML+2.75%)
due 03/31/2025.......................... 119,100 117,016
----------
Food-Meat Products -- 0.4%
Informatica LLC FRS
BTL
4.98%-5.00% (1 ML+2.50%)
due 10/30/2022.......................... 1,280,769 1,269,883
----------
Food-Misc./Diversified -- 0.5%
Dole Food Co., Inc. FRS
BTL-B
5.24%-5.25% (1 ML+2.75%)
due 04/06/2024.......................... 346,877 331,701
Dole Food Co., Inc. FRS
BTL-B
7.25% (USFRBPLR+1.75%)
due 04/06/2024.......................... 167 160
60
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
LOANS(9)(10)(11) (continued)
Food-Misc./Diversified (continued)
H-Food Holdings LLC FRS
1st Lien
6.18% (1 ML+3.69%)
due 05/23/2025........................... $ 972,650 $ 943,471
Sigma Bidco BV FRS
BTL-B2
5.60% (3 ML+3.00%)
due 07/02/2025........................... 382,113 370,649
----------
1,645,981
----------
Food-Retail -- 0.4%
Albertson's LLC FRS
BTL-B7
5.50% (1 ML+3.00%)
due 11/17/2025........................... 717,775 707,681
Albertson's LLC FRS
BTL-B5
5.61% (3 ML+3.00%)
due 12/21/2022........................... 457,345 453,017
----------
1,160,698
----------
Gambling (Non-Hotel) -- 0.3%
Scientific Games International, Inc. FRS
BTL-B5
5.25% (1 ML+2.75%)
due 08/14/2024........................... 179,180 173,965
Scientific Games International, Inc. FRS
BTL-B5
5.33% (2 ML+2.75%)
due 08/14/2024........................... 746,470 724,742
----------
898,707
----------
Hazardous Waste Disposal -- 0.4%
GFL Environmental, Inc. FRS
BTL
5.50% (1 ML+3.00%)
due 05/30/2025........................... 1,134,286 1,096,713
----------
Hotels/Motels -- 0.4%
Playa Resorts Holding BV FRS
BTL
5.25% (1 ML+2.75%)
due 04/29/2024........................... 1,349,633 1,294,523
----------
Housewares -- 0.5%
American Greetings Corp Term Loan FRS
BTL
7.00% (1 ML+4.50%)
due 04/06/2024........................... 650,336 638,955
Libbey Glass, Inc. FRS
BTL
5.49% (1 ML+3.00%)
due 04/09/2021........................... 861,718 805,707
----------
1,444,662
----------
Human Resources -- 0.3%
CHG Healthcare Services, Inc. FRS
1st Lien
5.50% (1 ML+3.00%)
due 06/07/2023........................... 319,955 317,555
Principal Value
Security Description Amount (Note 2)
Human Resources (continued)
CHG Healthcare Services, Inc. FRS
1st Lien
5.74% (3 ML+3.00%)
due 06/07/2023................................. $ 570,035 $ 565,760
----------
883,315
----------
Independent Power Producers -- 0.4%
Calpine Corp. FRS
BTL-B9
coupon TBD
due 04/05/2026................................. 1,205,000 1,192,119
----------
Instruments-Controls -- 0.3%
Deliver Buyer, Inc. FRS
BTL
7.60% (3 ML+5.00%)
due 05/01/2024................................. 1,039,421 1,026,428
----------
Insurance-Property/Casualty -- 0.6%
Sedgwick Claims Management Services, Inc. FRS
BTL
5.75% (1 ML+3.25%)
due 12/31/2025................................. 1,865,325 1,823,937
----------
Internet Gambling -- 0.2%
GVC Holdings PLC FRS
BTL-B2
5.00% (1 ML+2.50%)
due 03/29/2024................................. 747,450 742,311
----------
Investment Companies -- 0.8%
TKC Holdings, Inc. FRS
1st Lein
6.24% (1 ML+3.75%)
due 02/01/2023................................. 1,661,494 1,625,149
UFC Holdings LLC FRS
1st Lein
5.75% (1 ML+3.25%)
due 08/18/2023................................. 813,349 805,893
----------
2,431,042
----------
Machinery-Electrical -- 0.6%
Brookfield WEC Holdings, Inc. FRS
1st Lien
6.25% (1 ML+3.75%)
due 08/01/2025................................. 1,286,775 1,283,880
Brookfield WEC Holdings, Inc. FRS
2nd Lien
9.25% (1 ML+6.75%)
due 08/03/2026................................. 515,000 514,678
----------
1,798,558
----------
Machinery-General Industrial -- 0.6%
Gardner Denver, Inc. FRS
BTL-B1
5.25% (1 ML+2.75%)
due 07/30/2024................................. 1,425,692 1,422,351
Zodiac Pool Solutions LLC FRS
BTL
4.75% (1 ML+2.25%)
due 07/02/2025................................. 317,600 311,724
----------
1,734,075
----------
61
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
LOANS(9)(10)(11) (continued)
Machinery-Pumps -- 0.6%
NN, Inc. FRS
BTL
5.75% (1 ML+3.25%)
due 04/02/2021................................... $ 519,800 $ 504,856
NN, Inc. FRS
BTL-B
6.25% (1 ML+3.75%)
due 10/19/2022................................... 707,174 693,030
Titan Acquisition, Ltd. FRS
BTL
5.50% (1 ML+3.00%)
due 03/28/2025................................... 772,200 715,443
----------
1,913,329
----------
Medical Information Systems -- 0.4%
IQVIA, Inc. FRS
BTL-B
4.25% (1 ML+1.75%)
due 06/11/2025................................... 1,290,250 1,267,671
----------
Medical Labs & Testing Services -- 0.9%
Envision Healthcare Corp. FRS
1st Lien
6.25% (1 ML+3.75%)
due 10/10/2025................................... 2,333,729 2,178,634
Explorer Holdings, Inc. FRS
BTL
6.35% (3 ML+3.75%)
due 05/02/2023................................... 260,316 258,363
Jaguar Holding Co. II FRS
BTL
5.00% (1 ML+2.50%)
due 08/18/2022................................... 523,493 517,718
----------
2,954,715
----------
Medical Products -- 0.1%
Greatbatch, Ltd. FRS
BTL-B
5.49% (1 ML+3.00%)
due 10/27/2022................................... 421,042 420,200
----------
Medical-Drugs -- 0.3%
Valeant Pharmaceuticals International, Inc. FRS
BTL
5.48% (1 ML+3.00%)
due 06/02/2025................................... 993,591 985,791
----------
Medical-Generic Drugs -- 0.3%
Amneal Pharmaceuticals LLC FRS
BTL-B
6.00% (1 ML+3.50%)
due 05/04/2025................................... 1,056,766 1,052,363
----------
Medical-Hospitals -- 1.8%
Accelerated Health Systems LLC FRS
BTL
5.99% (1 ML+3.50%)
due 10/31/2025................................... 882,788 880,581
Principal Value
Security Description Amount (Note 2)
Medical-Hospitals (continued)
AHP Health Partners, Inc. FRS
BTL
7.00% (1 ML+4.50%)
due 06/30/2025.................................... $ 997,463 $ 996,216
CCS-CMGC Holdings, Inc. FRS
1st Lien
8.00% (1 ML+5.50%)
due 10/01/2025.................................... 807,975 767,576
Prospect Medical Holdings, Inc. FRS
BTL-B1
8.00% (1 ML+5.50%)
due 02/22/2024.................................... 490,050 445,946
RegionalCare Hospital Partners Holding, Inc. FRS
BTL-B
6.98% (3 ML+4.50%)
due 11/16/2025.................................... 1,127,175 1,114,212
Select Medical Corp. FRS
BTL-B
4.99% (3 ML+2.50%)
due 03/06/2025.................................... 860,126 854,750
Surgery Center Holdings, Inc. FRS
BTL
5.75% (1 ML+3.25%)
due 09/02/2024.................................... 723,975 711,305
----------
5,770,586
----------
Medical-Outpatient/Home Medical -- 0.2%
21st Century Oncology, Inc. FRS
BTL-B
8.91% (3 ML+6.13%)
due 01/16/2023.................................... 358,501 297,556
Civitas Solutions, Inc. FRS
BTL-B
6.75% (1 ML+4.25%)
due 03/09/2026.................................... 216,550 215,805
Civitas Solutions, Inc. FRS
Incremental BTL-C
6.75% (1 ML+4.25%)
due 03/09/2026.................................... 13,450 13,404
----------
526,765
----------
Motion Pictures & Services -- 0.3%
Delta 2 Lux SARL FRS
BTL-B3
5.00% (1 ML+2.50%)
due 02/01/2024.................................... 1,114,690 1,067,316
----------
Non-Hazardous Waste Disposal -- 0.2%
Tunnel Hill Partners LP FRS
BTL-B
6.00% (1 ML+3.50%)
due 02/06/2026.................................... 760,000 753,667
----------
Oil & Gas Drilling -- 0.5%
Paragon Offshore Finance Co.
Escrow Loans
7.25% due 07/18/2021+(6).......................... 1,745 0
62
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
LOANS(9)(10)(11) (continued)
Oil & Gas Drilling (continued)
Seadrill Operating LP FRS
BTL
8.61% (3 ML+6.00%)
due 02/21/2021........................... $1,978,576 $1,645,517
----------
1,645,517
----------
Oil Companies-Exploration & Production -- 0.7%
California Resources Corp. FRS
BTL
7.25% (1 ML+4.75%)
due 12/31/2022........................... 650,000 637,000
Fieldwood Energy LLC FRS
1st Lien
7.74% (1 ML+5.25%)
due 04/11/2022........................... 480,382 456,844
Fieldwood Energy LLC FRS
2nd Lien
9.75% (1 ML+7.25%)
due 04/11/2023........................... 128,766 105,159
Gavilan Resources LLC FRS
2nd Lien
8.49% (1 ML+6.00%)
due 03/01/2024........................... 470,000 368,950
Ultra Resources, Inc. FRS
BTL
6.49% (1 ML+4.00%)
due 04/12/2024........................... 705,000 610,266
----------
2,178,219
----------
Oil Refining & Marketing -- 0.3%
Citgo Petroleum Corp. FRS
BTL-B
coupon TBD
due 03/22/2024........................... 1,050,000 1,039,500
----------
Oil-Field Services -- 0.9%
McDermott Technology Americas, Inc. FRS
BTL
7.50% (1 ML+5.00%)
due 05/12/2025........................... 1,173,150 1,121,531
MRC Global US, Inc. FRS
BTL
5.50% (1 ML+3.00%)
due 09/20/2024........................... 997,375 993,635
Weatherford International, Ltd. FRS
BTL
3.93% (1 ML+1.43%)
due 07/13/2020........................... 575,806 562,131
----------
2,677,297
----------
Pharmacy Services -- 0.5%
Change Healthcare Holdings LLC FRS
BTL
5.25% (1 ML+2.75%)
due 03/01/2024........................... 1,567,061 1,544,339
----------
Principal Value
Security Description Amount (Note 2)
Pipelines -- 0.7%
Medallion Midland Acquisition LLC FRS
BTL
5.75% (1 ML+3.25%)
due 10/30/2024................................. $1,103,841 $1,073,486
Traverse Midstream Partners LLC FRS
BTL
6.50% (1 ML+4.00%)
due 09/27/2024................................. 1,218,875 1,215,828
----------
2,289,314
----------
Pollution Control -- 0.1%
Filtration Group Corp. FRS
BTL
5.50% (1 ML+3.00%)
due 03/29/2025................................. 405,900 402,179
----------
Printing-Commercial -- 0.3%
Fort Dearborn Co. FRS
1st Lien
6.48% (1 ML+4.00%)
due 10/19/2023................................. 36,640 35,403
Fort Dearborn Co. FRS
1st Lien
6.79% (3 ML+4.00%)
due 10/19/2023................................. 1,090,068 1,053,278
----------
1,088,681
----------
Publishing-Books -- 0.3%
McGraw-Hill Global Education Holdings LLC FRS
BTL-B
6.50% (1 ML+4.00%)
due 05/04/2022................................. 855,730 784,419
----------
Publishing-Periodicals -- 0.2%
Meredith Corp. FRS
BTL-B1
5.25% (1 ML+2.75%)
due 01/31/2025................................. 620,569 618,630
----------
Real Estate Investment Trusts -- 0.7%
iStar, Inc. FRS
BTL
5.23%-5.24% (1 ML+2.75%)
due 06/28/2023................................. 1,434,163 1,419,821
Uniti Group, Inc. FRS
BTL
7.50% (1 ML+5.00%)
due 10/24/2022................................. 757,562 738,939
----------
2,158,760
----------
Recycling -- 0.1%
Gopher Resource LLC FRS
BTL
5.75% (1 ML+3.25%)
due 03/06/2025................................. 258,812 257,518
----------
Research & Development -- 0.1%
PAREXEL International Corp. FRS
BTL
5.25% (1 ML+2.75%)
due 09/27/2024................................. 226,550 217,884
----------
63
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Principal Value
Security Description Amount (Note 2)
LOANS(9)(10)(11) (continued)
Retail-Bedding -- 0.2%
Serta Simmons Bedding LLC FRS
1st Lien
5.98%-5.99% (1 ML+3.50%)
due 11/08/2023............................ $ 960,400 $ 706,694
----------
Retail-Building Products -- 0.3%
SiteOne Landscape Supply Holding LLC FRS
BTL-E
5.24% (1 ML+2.75%)
due 10/29/2024............................ 891,760 885,071
----------
Retail-Major Department Stores -- 0.4%
Neiman Marcus Group, Ltd. LLC FRS
BTL
5.73% (1 ML+3.25%)
due 10/25/2020............................ 1,496,327 1,386,597
----------
Retail-Pet Food & Supplies -- 0.2%
PetSmart, Inc. FRS
BTL-B2
5.49% (1 ML+3.00%)
due 03/11/2022............................ 566,912 507,859
----------
Retail-Sporting Goods -- 0.5%
Bass Pro Group LLC FRS
BTL
7.50% (1 ML+5.00%)
due 09/25/2024............................ 1,504,214 1,469,429
----------
Retail-Vitamins & Nutrition Supplements -- 0.3%
Isagenix International LLC FRS
BTL
8.35% (3 ML+5.75%)
due 06/14/2025............................ 919,188 818,077
----------
Rubber/Plastic Products -- 0.7%
Gates Global LLC FRS
BTL-B2
5.25% (1 ML+2.75%)
due 04/01/2024............................ 1,209,609 1,194,921
U.S. Farathane LLC FRS
BLT-B4
6.11% (3 ML+3.50%)
due 12/23/2021............................ 988,848 956,711
----------
2,151,632
----------
Schools -- 0.3%
Laureate Education, Inc. FRS
BTL
6.00% (1 ML+3.50%)
due 04/26/2024............................ 1,033,219 1,032,358
----------
Soap & Cleaning Preparation -- 0.8%
Diamond BC BV FRS
BTL
5.74% (3 ML+3.00%)
due 09/06/2024............................ 1,091,188 1,040,720
KIK Custom Products, Inc. FRS
BTL
6.50% (1 ML+4.00%)
due 05/15/2023............................ 809,167 763,651
Zep, Inc. FRS
1st Lein
6.60% (3 ML+4.00%)
due 08/12/2024............................ 753,525 632,961
----------
2,437,332
----------
Principal Value
Security Description Amount (Note 2)
Telecom Services -- 1.1%
Securus Technologies Holdings, Inc. FRS
1st Lien
7.00% (1 ML+4.50%)
due 11/01/2024........................... $1,033,319 $1,025,569
Securus Technologies Holdings, Inc. FRS
1st Lien
coupon TBD
due 11/01/2024........................... 131,667 130,680
Securus Technologies Holdings, Inc. FRS
2nd Lien
10.75% (1 ML+8.25%)
due 11/01/2025........................... 505,000 494,058
Telenet Financing USD LLC FRS
BTL-AN
4.73% (1 ML+2.25%)
due 08/15/2026........................... 1,125,000 1,100,625
West Corp. FRS
BTL-B
6.63% (3 ML+4.00%)
due 10/10/2024........................... 682,344 638,560
----------
3,389,492
----------
Telecommunication Equipment -- 0.2%
CommScope, Inc. FRS
BTL-B
coupon TBD
due 04/06/2026........................... 630,000 629,527
----------
Telephone-Integrated -- 0.2%
Frontier Communications Corp. FRS
BTL-B1
6.25% (1 ML+3.75%)
due 06/15/2024........................... 610,341 593,557
----------
Television -- 0.2%
Tribune Media Co. FRS
BTL-B
5.50% (1 ML+3.00%)
due 12/27/2020........................... 53,618 53,450
Tribune Media Co. FRS
BTL-C
5.50% (1 ML+3.00%)
due 01/27/2024........................... 668,275 666,938
----------
720,388
----------
Theaters -- 0.7%
CDS U.S. Intermediate Holdings, Inc. FRS
BTL-B
6.25%-6.35% (1 ML+3.75%)
due 07/08/2022........................... 658,940 600,459
CDS U.S. Intermediate Holdings, Inc. FRS
BTL-B
6.35% (3 ML+3.75%)
due 07/08/2022........................... 562,069 512,185
Cineworld, Ltd. FRS
BTL
5.00% (1 ML+2.50%)
due 02/28/2025........................... 959,061 935,324
----------
2,047,968
----------
64
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
Shares/
Principal Value
Security Description Amount (Note 2)
LOANS(9)(10)(11) (continued)
Transport-Services -- 0.3%
CEVA Logistics Finance BV FRS
BTL-B
6.35% (3 ML+3.75%)
due 08/04/2025............................... $ 786,050 $ 784,085
------------
Veterinary Diagnostics -- 0.3%
NVA Holdings, Inc. FRS
BTL-B3
5.25% (1 ML+2.75%)
due 02/02/2025............................... 1,029,626 993,589
------------
Vitamins & Nutrition Products -- 0.1%
HLF Financing SARL LLC FRS
BTL-B
5.75% (1 ML+3.25%)
due 08/18/2025............................... 298,500 297,807
------------
Total Loans
(cost $165,221,527).......................... 158,741,317
------------
FOREIGN GOVERNMENT OBLIGATIONS -- 0.9%
Sovereign -- 0.9%
Arab Republic of Egypt
Senior Notes
7.50% due 01/31/2027*........................ 765,000 800,894
Arab Republic of Egypt
Senior Notes
7.60% due 03/01/2029*........................ 305,000 313,073
Islamic Republic of Pakistan
Senior Notes
8.25% due 09/30/2025*........................ 720,000 770,544
Republic of Argentina
Senior Notes
5.63% due 01/26/2022......................... 1,020,000 879,750
------------
Total Foreign Government Obligations
(cost $2,770,001)............................ 2,764,261
------------
COMMON STOCKS -- 0.2%
Electric-Generation -- 0.0%
Vistra Energy Corp. CVR+(13).................. 27,942 20,062
------------
Multimedia -- 0.0%
Haights Cross Communication, Inc.+(6)(13)..... 19,388 0
------------
Television -- 0.2%
ION Media Networks, Inc.+(6)(13).............. 660 592,139
------------
Total Common Stocks
(cost $167,312).............................. 612,201
------------
EXCHANGE-TRADED FUNDS -- 1.0%
iShares iBoxx $ High Yield Corporate Bond ETF. 18,028 1,558,881
SPDR Barclays Capital High Yield Bond ETF..... 44,652 1,606,133
------------
Total Exchange-Traded Funds
(cost $3,165,940)............................ 3,165,014
------------
PREFERRED SECURITIES -- 0.2%
Diversified Banking Institutions -- 0.2%
GMAC Capital Trust I FRS
Series 2
8.47% (3 ML+5.79%)
(cost $770,412).............................. 30,000 781,200
------------
Shares/
Principal Value
Security Description Amount (Note 2)
PREFERRED SECURITIES/CAPITAL SECURITIES -- 0.7%
Banks-Super Regional -- 0.5%
Huntington Bancshares, Inc.
Series E
5.70% due 04/15/2023(12)................... $ 738,000 $ 719,550
KeyCorp.
5.00% due 09/15/2026(12)................... 880,000 860,728
------------
1,580,278
------------
Insurance-Multi-line -- 0.2%
Voya Financial, Inc.
5.65% due 05/15/2053....................... 460,000 453,100
------------
Total Preferred Securities/Capital Securities
(cost $2,098,233).......................... 2,033,378
------------
Total Long-Term Investment Securities
(cost $314,004,870)........................ 304,065,072
------------
SHORT-TERM INVESTMENT SECURITIES -- 6.9%
Registered Investment Companies -- 4.7%
State Street Institutional U.S. Government
Money Market Fund, Premier Class
2.39%(3)................................... 14,628,811 14,628,811
------------
U.S. Government Treasuries -- 2.2%
United States Treasury Bills
2.34% due 06/27/2019....................... $ 7,000,000 6,960,285
------------
Total Short-Term Investment Securities
(cost $21,589,395)......................... 21,589,096
------------
TOTAL INVESTMENTS
(cost $335,594,265)(5)..................... 104.4% 325,654,168
Liabilities in excess of other assets......... (4.4) (13,864,729)
----------- ------------
NET ASSETS 100.0% $311,789,439
=========== ============
--------
* Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be sold in transactions exempt from
registration, normally to qualified institutional buyers. The Fund has no
right to demand registration of these securities. At March 31, 2019, the
aggregate value of these securities was $82,151,413 representing 26.3% of
net assets.
+ Non-income producing security
(1) Security in default of interest.
(2) Company has filed for bankruptcy protection.
(3) The rate shown is the 7-day yield as of March 31, 2019.
(4) PIK ("Payment-in-Kind") security -- Income may be paid in additional
securities or cash at the discretion of the issuer. The security is
currently paying interest in cash at the coupon rate listed.
(5) See Note 5 for cost of investments on a tax basis.
(6) Securities classified as Level 3 (see Note 2).
(7) Security in default of interest and principal at maturity.
(8) PIK ("Payment-in-Kind") security -- Income may be paid in additional
securities or cash at the discretion of the issuer. The security is
currently paying interest in the form of additional securities at the
coupon rate listed.
65
AIG Flexible Credit Fund
PORTFOLIO OF INVESTMENTS -- March 31, 2019 -- (continued)
(9) Senior loans in the Fund are generally subject to mandatory and/or
optional prepayment. Because of these mandatory prepayment conditions and
because there may be significant economic incentives for a borrower to
prepay, prepayments may occur. As a result, the actual remaining maturity
may be substantially less than the stated maturities shown.
(10) The Fund invests in senior loans which generally pay interest at rates
which are periodically re-determined by reference to a base lending rate
plus a premium. These base lending rates are generally either the lending
rate offered by one or more major European banks, such as the London
Inter-Bank Offered Rate ("LIBOR") or the prime rate offered by one or more
major United States banks, or the certificate of deposit rate. Senior
loans are generally considered to be restrictive in that the Fund is
ordinarily contractually obligated to receive approval from the Agent Bank
and/or borrower prior to the disposition of a senior loan.
(11) All loans in the Fund were purchased through assignment agreements unless
otherwise indicated.
(12) Perpetual maturity -- maturity date reflects the next call date.
(13) Denotes a restricted security that: (a) cannot be offered for public sale
without first being registered, or being able to take advantage of an
exemption from registration, under the Securities Act of 1933, as amended
(the "1933 Act"); (b) is subject to a contractual restriction on public
sales; or (c) is otherwise subject to a restriction on sales by operation
of applicable law. Restricted securities are valued pursuant to Note
2. Certain restricted securities held by the Fund may not be sold except
in exempt transactions or in a public offering registered under the 1933
Act. The Fund has no right to demand registration of these securities. The
risk of investing in certain restricted securities is greater than the
risk of investing in the securities of widely held, publicly traded
companies. To the extent applicable, lack of a secondary market and resale
restrictions may result in the inability of a Fund to sell a security at a
fair price and may substantially delay the sale of the security. In
addition, certain restricted securities may exhibit greater price
volatility than securities for which secondary markets exist. As of
March 31, 2019, the Fund held the following restricted securities:
Value % of
Acquisition Acquisition Per Net
Description Date Shares Cost Value Share Assets
----------- ----------- ------ ----------- -------- ------- ------
Common Stocks
Haights Cross
Communications,
Inc................ 01/27/2004 1,491 13,216
06/06/2005 17,897 154,089
------ --------
19,388 $167,305 $ 0 $ 0.00 0.00%
ION Media Networks,
Inc................ 12/21/2016 660 7 592,139 897.18 0.19
Vistra Energy Corp.
CVR................ 10/06/2016 27,942 0 20,062 0.72 0.01
-------- ----
$612,201 0.20%
======== ====
BTL --Bank Term Loan
CVR --Contingent Value Rights
ETF --Exchange-Traded Fund
TBD --Senior loan purchased on a when-issued or delayed-delivery basis. Certain
details associated with this purchase are not known prior to the
settlement date of the transaction. In addition, senior loans typically
trade without accrued interest and therefore a coupon rate is not
available prior to the settlement.
FRS --Floating Rate Security
The rates shown on FRS are the current interest rates at March 31, 2019 and
unless noted otherwise, the dates shown are the original maturity dates.
Index Legend
1 ML -- 1 Month USD Libor
2 ML -- 2 Month USD Libor
3 ML -- 3 Month USD Libor
6 ML -- 6 Month USD Libor
USFRBPLR --US Federal Reserve Bank Prime Loan Rate
The following is a summary of the inputs used to value the Fund's net assets as
of March 31, 2019 (see Note 2):
Level 1 -- Unadjusted Level 2 -- Other Level 3 -- Significant
Quoted Prices Observable Inputs Unobservable Inputs Total
- --------------------- ----------------- ---------------------- ------------
ASSETS:
Investments at Value:*
Asset Backed Securities................. $ -- $ 866,750 $ -- $ 866,750
U.S. Corporate Bonds & Notes:
Rubber/Plastic Products............... -- -- 0 0
Other Industries...................... -- 112,922,799 -- 112,922,799
Foreign Corporate Bonds & Notes:
Special Purpose Entity................ -- -- 0 0
Other Industries...................... -- 22,178,152 -- 22,178,152
Loans:
Building-Residential/Commercial....... -- -- 0 0
Oil & Gas Drilling.................... -- 1,645,517 0 1,645,517
Other Industries...................... -- 157,095,800 -- 157,095,800
Foreign Government Obligations.......... -- 2,764,261 -- 2,764,261
Common Stocks:
Electric-Generation................... -- 20,062 -- 20,062
Other Industries...................... -- -- 592,139 592,139
Exchange-Traded Funds................... 3,165,014 -- -- 3,165,014
Preferred Securities.................... 781,200 -- -- 781,200
Preferred Securities/Capital Securities. -- 2,033,378 -- 2,033,378
Short-Term Investment Securities:
Registered Investment Companies....... 14,628,811 -- -- 14,628,811
U.S. Government Treasuries............ -- 6,960,285 -- 6,960,285
----------- ------------ -------- ------------
Total Investments at Value.............. $18,575,025 $306,487,004 $592,139 $325,654,168
=========== ============ ======== ============
--------
* For a detailed presentation of investments, please refer to the Portfolio of
Investments.
At the beginning and end of the reporting period, Level 3 investments in
securities were not considered a material portion of the Fund. There were no
Level 3 transfers during the reporting period.
See Notes to Financial Statements
66
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019
Note 1. Organization
The SunAmerica Income Funds (the "Trust") is a diversified open-end
management investment company organized as a Massachusetts business trust.
The Trust currently consists of three different series (each, a "Fund" and
collectively, the "Funds"). Each Fund is a separate series of the Trust with
distinct investment objectives and/or strategies. Each Fund is managed by
SunAmerica Asset Management, LLC (the "Adviser" or "SunAmerica"), an
indirect wholly-owned subsidiary of American International Group, Inc.
("AIG"). An investor may invest in one or more of the following Funds: AIG
U.S. Government Securities Fund ("U.S. Government Securities Fund"), AIG
Strategic Bond Fund ("Strategic Bond Fund"), and AIG Flexible Credit Fund
("Flexible Credit Fund"). The Funds are considered to be separate entities
for financial and tax reporting purposes.
The investment goals and principal investment techniques for each of the
Funds are as follows:
U.S. Government Securities Fund seeks high current income consistent with
relative safety of capital by the active trading of U.S. Government
securities, without regard to the maturities of such securities. Under
normal market conditions, at least 80% of the Fund's net assets plus any
borrowing for investment purposes will be invested in such securities.
Strategic Bond Fund seeks a high level of total return by the active trading
of a broad range of bonds, including both investment grade and
non-investment grade U.S. and foreign bonds (which may include "junk
bonds"), U.S. and foreign government and agency obligations, and
mortgage-backed securities, without regard to the maturities of such
securities. Under normal market conditions, at least 80% of the Fund's net
assets plus any borrowing for investment purposes will be invested in bonds.
Flexible Credit Fund seeks a high level of total return by the active
trading in credit instruments. Under normal circumstances, at least 80% of
the Fund's net assets, plus any borrowings for investment purposes, will be
invested in credit instruments and derivative instruments and
exchange-traded funds ("ETFs") that are linked to, or provide investment
exposure to, credit instruments. The Fund considers a credit instrument to
be any debt instrument or instrument with debt-like characteristics,
including but not limited to, corporate and sovereign bonds, secured
floating rate loans and other institutionally traded secured floating rate
debt obligations ("Loans"), and securitized instruments, which are
securities backed by pools of assets such as mortgages, loans, or other
receivables. The credit instruments in which the Fund intends to primarily
invest are U.S. and non-U.S. below investment grade, high yield bonds
(commonly referred to as "junk bonds") and Loans.
Each Fund offers multiple classes of shares. The classes within each Fund
are presented in the Statements of Assets and Liabilities. The cost
structure for each class is as follows:
Class A shares are offered at net asset value per share plus an initial
sales charge. Additionally, purchases of Class A shares in amounts of
$1,000,000 or more will be purchased at net asset value but will be subject
to a contingent deferred sales charge on redemptions made within two years
of purchase.
Class B shares are offered without an initial sales charge, although a
declining contingent deferred sales charge may be imposed on redemptions
made within six years of purchase. Class B shares convert automatically to
Class A shares on the first business day of the month following the eighth
anniversary of the issuance of such Class B shares and at such time will be
subject to the lower distribution fee applicable to Class A shares.
Class C shares are offered at net asset value per share without an initial
sales charge and may be subject to a contingent deferred sales charge on
redemptions made within 12 months of purchase. Class C shares convert
automatically to Class A shares approximately ten years after purchase and
at such time will be subject to the lower distribution fee applicable to
Class A shares.
Class W shares are offered at net asset value per share. The class is
offered exclusively through advisory fee-based programs sponsored by certain
financial intermediaries and other programs. Class W shares of the Flexible
Credit Fund and the Strategic Bond Fund commenced operations effective
October 1, 2014 and January 29, 2015, respectively.
Each class of shares bears the same voting, dividend, liquidation and other
rights and conditions except as may otherwise be provided in the Trust's
registration statement. Class A, Class B and Class C shares each makes
distribution and account
67
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
maintenance and service fee payments under the distribution plan pursuant to
Rule 12b-1 under the Investment Company Act of 1940, as amended (the "1940
Act"), with Class B and Class C shares being subject to higher distribution
fee rates. Class W shares have not adopted 12b-1 Plans and make no payments
thereunder, however, Class W shares pay a service fee to the Funds'
distributor for administrative and shareholder services.
Indemnifications: The Trust's organizational documents provide current and
former officers and trustees with a limited indemnification against
liabilities arising out of the performance of their duties to the Trust. In
addition, pursuant to Indemnification Agreements between the Trust and each
of the current trustees who is not an "interested person," as defined in
Section 2(a)(19) of the 1940 Act, of the Trust (collectively, the
"Disinterested Trustees"), the Trust provides the Disinterested Trustees
with a limited indemnification against liabilities arising out of the
performance of their duties to the Trust, whether such liabilities are
asserted during or after their service as trustees. In addition, in the
normal course of business, the Trust enters into contracts that contain the
obligation to indemnify others. The Trust's maximum exposure under these
arrangements is unknown. Currently, however, the Trust expects the risk of
loss to be remote.
Note 2. Significant Accounting Policies
The preparation of financial statements in accordance with U.S. generally
accepted accounting principles ("GAAP") requires management to make
estimates and assumptions that affect the reported amounts and disclosures
in the financial statements. Actual results could differ from those
estimates and those differences could be significant. The Funds are
considered investment companies under GAAP and follow the accounting and
reporting guidance applicable to investment companies. The following is a
summary of significant accounting policies consistently followed by the
Trust in the preparation of its financial statements:
Security Valuation: In accordance with the authoritative guidance on fair
value measurements and disclosures under GAAP, the Funds disclose the fair
value of their investments in a hierarchy that prioritizes the inputs to
valuation techniques used to measure the fair value. In accordance with
GAAP, fair value is defined as the price that the Funds would receive upon
selling an asset or transferring a liability in a timely transaction to an
independent third party in the principal or most advantageous market. GAAP
establishes a three-tier hierarchy to provide more transparency around the
inputs used to measure fair value and to establish classification of fair
value measurements for disclosure purposes. Inputs refer broadly to the
assumptions that market participants would use in pricing the asset or
liability, including assumptions about risk. Inputs may be observable or
unobservable. Observable inputs are inputs that reflect the assumptions
market participants would use in pricing the asset or liability developed
based on market data obtained from sources independent of the reporting
entity. Unobservable inputs are inputs that reflect the reporting entity's
own assumptions about the assumptions market participants would use in
pricing the asset or liability developed based on the best information
available in the circumstances. The three-tiers are as follows:
Level 1 -- Unadjusted quoted prices in active markets for identical
securities
Level 2 -- Other significant observable inputs (including quoted prices for
similar securities, interest rates, prepayment speeds, credit risk,
referenced indices, quoted prices in inactive markets, adjusted quoted
prices in active markets, adjusted quoted prices on foreign equity
securities that were adjusted in accordance with pricing procedures approved
by the Board of Trustees ("the Board"), etc.)
Level 3 -- Significant unobservable inputs (includes inputs that reflect the
Funds' own assumptions about the assumptions market participants would use
in pricing the security, developed based on the best information available
under the circumstances)
Changes in valuation techniques may result in transfers in or out of an
investment's assigned Level within the hierarchy. The methodology used for
valuing investments is not necessarily an indication of the risk associated
with investing in those investments and the determination of the
significance of a particular input to the fair value measurement in its
entirety requires judgment and consideration of factors specific to each
security.
The availability of observable inputs can vary from security to security and
is affected by a wide variety of factors, including, for example, the type
of security, whether the security is recently issued and not yet established
in the marketplace, the liquidity of markets, and other characteristics
particular to the security. To the extent that valuation is based on models
or inputs that are less observable or unobservable in the market, the
determination of fair value requires more judgment. Accordingly, the degree
of judgment exercised in determining fair value is greatest for instruments
categorized in Level 3.
68
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
The summary of each Fund's asset and liabilities classified in the fair
value hierarchy as of March 31, 2019 is reported on a schedule at the end of
each Fund's Portfolio of Investments.
Stocks are generally valued based upon closing sales prices reported on
recognized securities exchanges on which the securities are principally
traded and are generally categorized as Level 1. Stocks listed on the NASDAQ
are valued using the NASDAQ Official Closing Price ("NOCP"). Generally, the
NOCP will be the last sale price unless the reported trade for the stock is
outside the range of the bid/ask price. In such cases, the NOCP will be
normalized to the nearer of the bid or ask price. For listed securities
having no sales reported and for unlisted securities, such securities will
be valued based upon the last reported bid price.
As of the close of regular trading on the New York Stock Exchange ("NYSE"),
securities traded primarily on security exchanges outside the United States
are valued at the last sale price on such exchanges on the day of valuation,
or if there is no sale on the day of valuation, at the last-reported bid
price. If a security's price is available from more than one exchange, the
Funds use the exchange that is the primary market for the security. Such
securities are generally categorized as Level 1. However, depending on the
foreign market, closing prices may be up to 15 hours old when they are used
to price a Fund's shares, and a Fund may determine that certain closing
prices do not reflect the fair value of the security. This determination
will be based on review of a number of factors, including developments in
foreign markets, the performance of U.S. securities markets, and the
performance of instruments trading in U.S. markets that represent foreign
securities and baskets of foreign securities. If a Fund determines that
closing prices do not reflect the fair value of the securities, the Fund
will adjust the previous closing prices in accordance with pricing
procedures approved by the Board to reflect what it believes to be the fair
value of the securities as of the close of regular trading on the NYSE. The
Funds may also fair value securities in other situations, for example, when
a particular foreign market is closed but a Fund is open. For foreign equity
securities and foreign equity futures contracts, the Funds use an outside
pricing service to provide it with closing market prices and information
used for adjusting those prices and when so adjusted, such securities and
futures are generally categorized as Level 2.
Bonds, debentures and other debt securities are valued at evaluated bid
prices obtained for the day of valuation from a Board-approved pricing
service, and are generally categorized as Level 2. The pricing service may
use valuation models or matrix pricing which considers information with
respect to comparable bond and note transactions, quotations from bond
dealers, or by reference to other securities that are considered comparable
in such characteristics as rating, interest rate, and maturity date, option
adjusted spread models, prepayments projections, interest rate spreads, and
yield curves to determine current value. If a price is unavailable from a
Board-approved pricing service, the securities may be priced at the mean of
two independent quotes obtained from brokers.
Senior floating rate loans ("Loans") are valued at the average of available
bids in the market for such Loans, as provided by a Board-approved loan
pricing service, and are generally categorized as Level 2.
Investments in registered investment companies that do not trade on an
exchange are valued at the end of day net asset value per share. Investments
in registered investment companies that trade on an exchange are valued at
the last sales price or official closing price as of the close of the
customary trading session on the exchange where the security is principally
traded. Investments in registered investment companies are generally
categorized as Level 1.
Forward foreign currency contracts ("forward contracts") are valued at the
4:00 p.m. Eastern Time forward rate and are generally categorized as Level 2.
Other securities are valued on the basis of last sale or bid price (if a
last sale price is not available) which is, in the opinion of the Adviser,
the broadest and most representative market, that may be either a securities
exchange or over-the-counter market and are generally categorized as Level 1
or Level 2.
The Board is responsible for the share valuation process and has adopted
policies and procedures (the "PRC Procedures") for valuing the securities
and other assets held by the Funds, including procedures for the fair
valuation of securities and other assets for which market quotations are not
readily available or are unreliable. The PRC Procedures provide for the
establishment of a pricing review committee, which is responsible for, among
other things, making certain determinations in connection with the
69
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
Trust's fair valuation procedures. Securities for which market quotations
are not readily available or the values of which may be significantly
impacted by the occurrence of developments or significant events are
generally categorized as Level 3. There is no single standard for making
fair value determinations, which may result in prices that vary from those
of other funds.
Derivative Instruments:
Forward Foreign Currency Contracts: During the period, the Strategic Bond
Fund used forward contracts to attempt to protect securities and related
receivables and payables against changes in future foreign exchange rates.
A forward contract is an agreement between two parties to buy or sell
currency at a set price on a future date. The market value of the contract
will fluctuate with changes in currency exchange rates. The contract is
marked-to-market daily using the forward rate and the cumulative change in
market value is recorded by a Fund as unrealized appreciation or
depreciation. On the settlement date, a Fund records either realized gains
or losses equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed.
Risks to the Funds of entering into forward contracts include counterparty
risk, market risk and illiquidity risk. Counterparty risk arises upon
entering into these contracts from the potential inability of counterparties
to meet the terms of their contracts. If the counterparty defaults, a Fund's
loss will generally consist of the net amount of contractual payments that
the Fund has not yet received though the Fund's maximum exposure due to
counterparty risk could extend to the notional amount of the contract.
Market risk is the risk that the value of the forward contract will
depreciate due to unfavorable changes in the exchange rates. These contracts
may involve market risk in excess of the unrealized appreciation or
depreciation reported on the Statements of Assets and Liabilities.
Illiquidity risk arises because the secondary market for forwards may have
less liquidity relative to markets for other securities. Currency
transactions are also subject to risks different from those of other
portfolio transactions. Because currency control is of great importance to
the issuing governments and influences economic planning and policy,
purchases and sales of currency and related instruments can be adversely
affected by government exchange controls, limitations or restrictions on
repatriation of currency, and manipulations or exchange restrictions imposed
by governments.
Forward foreign currency contracts outstanding at the end of the period, if
any, are reported on a schedule at the end of each Fund's Portfolio of
Investments.
Master Agreements: Certain Funds that hold derivative instruments and other
financial instruments may be a party to ISDA (International Swaps and
Derivatives Association, Inc.) Master Agreements or similar agreements
("Master Agreements") with certain counterparties that govern certain
instruments. Master Agreements may contain provisions regarding, among other
things, the parties' general obligations, representations, agreements,
collateral requirements, events of default and early termination. Collateral
can be in the form of cash or securities as agreed to by the Fund and
applicable counterparty. Collateral requirements are generally determined
based on a Fund's net position with each counterparty. Master Agreements may
also include certain provisions that require a Fund to post additional
collateral upon the occurrence of certain events, such as when a Fund's net
assets fall below a specified level. In addition, Master Agreements
typically specify certain standard termination events, such as failure of a
party to pay or deliver, credit support defaults and other events of
default. Termination events applicable to a Fund may also occur upon a
decline in the Fund's net assets below a specified level over a certain
period of time. Additional termination events applicable to counterparties
may occur upon a decline in a counterparty's long-term and short-term credit
ratings below a specified level, or upon a decline in the ratings of a
counterparty's credit support provider. Upon the occurrence of a termination
event, the other party may elect to terminate early and cause settlement of
all instruments outstanding pursuant to a particular Master Agreement,
including the payment of any losses and costs resulting from such early
termination, as reasonably determined by the terminating party. Any decision
by one or more of a Fund's counterparties to elect early termination could
cause a Fund to accelerate the payment of liabilities, which settlement
amounts could be in excess of the amount of assets that are already posted
as collateral. Typically, the Master Agreement will permit a single net
payment in the event of default. Note, however, that bankruptcy or
insolvency laws of a particular jurisdiction may impose restrictions on or
prohibitions against the right of offset in bankruptcy, insolvency or other
events. As a result, the early termination with respect to derivative
instruments subject to Master Agreements that are in a net liability
position could be material to a Fund's financial statements. The Funds do
not offset derivative assets and derivative liabilities that are subject to
netting arrangements in the Statements of Asset and Liabilities.
70
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
The following tables represent the value of derivatives held as of March 31,
2019, by their primary underlying risk exposure. The derivative contracts
held during the period are not accounted for as hedging instruments under
GAAP. For a detailed presentation of derivatives held as of March 31, 2019,
please refer to the schedule at the end of each Fund's Portfolio of
Investments.
Liability
Asset Derivatives Derivatives
----------------- ------------
Foreign Foreign
Exchange Exchange
Contracts Contracts
----------------- ------------
Forward Forward
Foreign Foreign
Currency Currency
Fund Contracts(1) Contracts(2)
---- ----------------- ------------
Strategic Bond............................... $177,745 $3,651
======== ======
--------
Statement of Assets and Liabilities Location:
(1)Unrealized appreciation on forward foreign currency contracts
(2)Unrealized depreciation on forward foreign currency contracts
Change in
Unrealized
Realized Appreciation
Gain (Loss) on (Depreciation) on
Derivatives Derivatives
Recognized in Recognized in
Statement of Statement of
Operations Operations
-------------- -----------------
Foreign Foreign
Exchange Exchange
Contracts Contracts
-------------- -----------------
Forward Forward
Foreign Foreign
Currency Currency
Fund Contracts(1) Contracts(2)
---- -------------- -----------------
Strategic Bond............................... $1,797,853 $141,170
========== ========
--------
Statement of Operations Location:
(1)Net realized gain (loss) on forward contracts
(2)Change in unrealized appreciation (depreciation) on forward contracts
The following table represents the average monthly balances of derivatives
held during the year ended March 31, 2019:
Average Amount
Outstanding
During the Year
---------------
Forward
Foreign
Currency
Fund Contracts(1)
---- ---------------
Strategic Bond............................... $16,347,836
===========
--------
(1)Amounts represent notional amounts in US dollars.
The following tables set forth the Funds' derivative assets and liabilities
by counterparty, net of amounts available for offset under Master Agreements
and net of the related collateral pledged/(received) as of March 31, 2019.
The repurchase agreements held by the Funds as of March 31, 2019, are also
subject to Master Agreements but are not included in the following tables.
See the Portfolio of Investments of each Fund and the Notes to the Financial
Statements for more information about the Funds' holdings in repurchase
agreements.
71
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
Strategic Bond
------------------------------------------------------------------------------------------------
Derivative Assets(1) Derivative Liabilities(1)
------------------------------------ -------------------------------
Forward Forward Net
Foreign Foreign Derivative Collateral
Currency OTC Options Currency OTC Options Assets Pledged/
Counterparty Contracts Swaps Purchased Total Contracts Swaps Written Total (Liabilities) (Received)(2)
------------------------ --------- ------- --------- -------- --------- ------ ------- ------ ------------- -------------
JPMorgan Chase Bank N.A. $177,745 $ -- $ -- $177,745 $ 3,651 $ -- $ -- $3,651 $ 174,094 $ --
======== ======= ========= ======== ======== ====== ======= ====== ========== ============
--------------
Counterparty Net Amount(3)
------------------------ -------------
JPMorgan Chase Bank N.A. $ 174,094
=============
--------
(1)Gross amounts of recognized assets and liabilities not offset in the
Statement of Assets and Liabilities.
(2)For each respective counterparty, collateral pledged or (received) is
limited to an amount not to exceed 100% of the derivative asset/liability in
the table above.
(3)Net amount represents the net amount due (to)/from counterparty in the event
of a default based on the contractual set-off rights under the agreement.
Mortgage-Backed Dollar Rolls: Certain Funds may enter into dollar rolls
using "to be announced" ("TBA") mortgage-backed securities ("TBA Rolls").
TBA Roll transactions involve the sale of mortgage or other asset backed
securities with the commitment to purchase substantially similar securities
on a specified future date. The Funds' policy is to record the components of
TBA Rolls as purchase/sale transactions. Any difference between the purchase
and sale price is recorded as a realized gain or loss on the date the
transaction is entered into. TBA Roll transactions involve the risk that the
market value of the securities held by a Fund may decline below the price of
the securities that the Fund has sold but is obligated to repurchase under
the agreement. In the event that the buyer of securities in a TBA Roll
transaction files bankruptcy or becomes insolvent, a Fund's use of the
proceeds from the sale of the securities may be restricted pending a
determination by the other party, or its trustee or receiver, whether to
enforce the Fund's obligation to repurchase the securities. Mortgage-Backed
Dollar Rolls outstanding at the end of the period, if any, are included in
investments purchased/sold on an extended settlement basis in the Statement
of Assets and Liabilities.
When-Issued Securities and Forward Commitments: Certain Funds may purchase
or sell when-issued securities (including TBA securities) that have been
authorized, but not yet issued in the market. In addition, a Fund may
purchase or sell securities on a forward commitment basis. A forward
commitment involves entering into a contract to purchase or sell securities,
typically on an extended settlement basis, for a fixed price at a future
date. The Funds may engage in when-issued or forward commitment transactions
in order to secure what is considered to be an advantageous price and yield
at the time of entering into the obligation. The purchase of securities on a
when-issued or forward commitment basis involves a risk of loss if the value
of the security to be purchased declines before the settlement date.
Conversely, the sale of securities on a when-issued or forward commitment
basis involves the risk that the value of the securities sold may increase
before the settlement date. Securities purchased or sold on a when-issued or
forward commitment basis outstanding at the end of the period, if any, are
included in investments purchased/sold on an extended settlement basis in
the Statement of Assets and Liabilities.
Loans: The Fund invests in senior loans which generally consist of direct
debt obligations of companies (collectively, "Borrowers"), primarily U.S.
companies and their affiliates, undertaken to finance the growth of the
Borrower's business internally and externally, or to finance a capital
restructuring. Transactions in senior loans may settle on a delayed basis.
Unsettled loans at the end of the period, if any, are included in
investments purchased/sold on an extended settlement basis in the Statement
of Assets and Liabilities.
Stripped Mortgage-Backed Securities: Stripped Mortgage-Backed Securities
("SMBS") are multiple-class mortgage-backed securities. SMBS are often
structured with two classes that receive different proportions of the
interest and principal distributions on a pool of mortgage assets. SMBS have
greater market volatility than other types of U.S. government securities in
which a Fund invests. A common type of SMBS has one class receiving some of
the interest and all or most of the principal (the "principal only" class)
from the mortgage pool, while the other class will receive all or most of
the interest (the "interest only" class). The yield to maturity on an
interest only class is extremely sensitive not only to changes in prevailing
interest rates, but also to the rate of principal payments, including
principal prepayments, on the underlying pool of mortgage assets, and a
rapid rate of principal payment may have a material adverse effect on a
Fund's yield.
Inflation-Indexed Bonds: Certain Funds may purchase inflation-indexed bonds.
Inflation-indexed bonds are fixed income securities whose principal value is
adjusted periodically according to the rate of inflation. Two structures are
common. The U.S. Treasury and certain other issuers use a structure that
reflects inflation in the principal value of the bond. Other issuers pay out
any inflation related accruals as part of a semiannual coupon. The value of
inflation-indexed bonds is expected to change in
72
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
response to changes in real interest rates. Real interest rates, in turn,
are tied to the relationship between nominal interest rates (i.e., stated
interest rates) and the rate of inflation. Therefore, if the rate of
inflation rises at a faster rate than nominal interest rates, real interest
rates (i.e., nominal interest rates minus inflation) might decline, leading
to an increase in value of inflation-indexed bonds. In contrast, if nominal
interest rates increase at a faster rate than inflation, real interest rates
might rise, leading to a decrease in value of inflation-indexed bonds. There
can be no assurance, however, that the value of inflation-indexed bonds will
be directly correlated to changes in nominal interest rates, and short-term
increases in inflation may lead to a decline in their value. Coupon payments
received from inflation-indexed bonds are recorded in the Statements of
Operations as interest income. In addition, any increase or decrease in the
principal amount of an inflation-indexed bond will be recorded in the
Statements of Operations as an increase or decrease to interest income, even
though principal is not paid until maturity.
Repurchase Agreements: The Funds, along with other affiliated registered
investment companies, pursuant to procedures adopted by the Board and
applicable guidance from the Securities and Exchange Commission ("SEC"), may
transfer uninvested cash balances into a single joint account, the daily
aggregate balance of which is invested in one or more repurchase agreements
collateralized by U.S. Treasury or federal agency obligations. In a
repurchase agreement, the seller of a security agrees to repurchase the
security at a mutually agreed-upon time and price, which reflects the
effective rate of return for the term of the agreement. For repurchase
agreements and joint repurchase agreements, the Trust's custodian takes
possession of the collateral pledged for investments in such repurchase
agreements ("repo" or collectively "repos"). The underlying collateral is
valued daily on a mark to market basis, plus accrued interest to ensure that
the value, at the time the agreement is entered into, is equal to at least
102% of the repurchase price, including accrued interest. In the event of
default of the obligation to repurchase, a Fund has the right to liquidate
the collateral and apply the proceeds in satisfaction of the obligation. If
the seller defaults and the value of the collateral declines or if
bankruptcy proceedings are commenced with respect to the seller of the
security, realization of the collateral by a Fund may be delayed or limited.
Securities Transactions, Investment Income, Expenses, Dividends and
Distributions to Shareholders: Security transactions are recorded on a trade
date basis. Interest income is accrued daily from settlement date except
when collection is not expected. Dividend income is recorded on the
ex-dividend date except for certain dividends from foreign securities, which
are recorded as soon as the Trust is informed after the ex-dividend date.
Paydown gains and losses on mortgage and asset-backed securities are
recorded as components of interest income on the Statements of Operations.
For financial statement purposes, the Funds amortize all premiums and
accrete all discounts on fixed income securities.
Realized gains and losses on the sale of investments are calculated on the
identified cost basis. Funds which earn foreign income and capital gains may
be subject to foreign withholding taxes and capital gains taxes at various
rates. Under applicable foreign law, a withholding of tax may be imposed on
interest, dividends, and capital gains from the sale of foreign securities
at various rates.
Income and expenses, other than class specific expenses, are allocated daily
to each class of shares based upon the relative value of dividend-eligible
shares after adjusting for the current capital share activity of the
respective class. Realized and unrealized gains and losses are allocated
daily to each class of shares based upon the relative value of outstanding
shares after adjusting for the current capital share activity of the
respective class.
Expenses common to all Funds are allocated among the Funds based upon
relative net assets or other appropriate allocation methods. In all other
respects, expenses are charged to each Fund as incurred on a specific
identification basis.
Dividends from net investment income are accrued daily and paid monthly.
Capital gain distributions, if any, are paid annually. The Funds record
dividends and distributions to their shareholders on the ex-dividend date.
The Funds reserve the right to declare and pay dividends less frequently
than disclosed above, provided that the net realized capital gains and net
investment income, if any, are paid at least annually.
The amount of dividends and distributions from net investment income and net
realized capital gains are determined in accordance with federal income tax
regulations, which may differ from GAAP. These "book/tax" differences are
either considered temporary or permanent in nature. To the extent these
differences are permanent in nature, such amounts are reclassified within
the capital accounts at fiscal year end based on their federal tax-basis
treatment; temporary differences do not require reclassification. Net assets
are not affected by these reclassifications.
73
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
Each Fund is considered a separate entity for tax purposes and intends to
comply with the requirements of the Internal Revenue Code, as amended,
applicable to regulated investment companies and distribute all of its
taxable income, including any net capital gains on investments, to its
shareholders. Each Fund also intends to distribute sufficient net investment
income and net capital gains, if any, so that it will not be subject to
excise tax on undistributed income and gains. Therefore, no federal income
tax or excise tax provision is required.
The Funds recognize the tax benefits of uncertain tax positions only when
the position is more likely than not to be sustained, assuming examination
by tax authorities. Management has analyzed each Fund's tax positions and
concluded that no liability for unrecognized tax benefits should be recorded
related to uncertain tax positions taken on returns filed for open tax years
2015 -- 2017 or expected to be taken in each Fund's 2018 tax return. The
Funds are not aware of any tax provisions for which it is reasonably
possible that the total amounts of unrecognized tax benefits will change
materially in the next twelve months. The Funds file U.S. federal and
certain state income tax returns. With few exceptions, the Funds are no
longer subject to U.S. federal and state tax examinations by tax authorities
for tax returns ending before 2015.
Foreign Currency Translation: The books and records of the Funds are
maintained in U.S. dollars. Assets and liabilities denominated in foreign
currencies and commitments under forward foreign currency contracts are
translated into U.S. dollars based on the exchange rate of such currencies
against U.S. dollars on the date of valuation.
The Funds do not isolate that portion of the results of operations arising
as a result of changes in the foreign exchange rates from the changes in the
market prices of securities held at the end of the period. Similarly, the
Funds do not isolate the effect of changes in foreign exchange rates from
the changes in the market prices of portfolio securities sold during the
period.
Realized foreign exchange gains and losses on other assets and liabilities
and change in unrealized foreign exchange gains and losses on other assets
and liabilities located in the Statements of Operations include realized
foreign exchange gains and losses from currency gains or losses between the
trade and the settlement dates of securities transactions, the difference
between the amounts of interest, dividends and foreign withholding taxes
recorded on the Funds' books and the U.S. dollar equivalent amounts actually
received or paid and changes in the unrealized foreign exchange gains and
losses relating to the other assets and liabilities arising as a result of
changes in the exchange rates.
New Accounting Pronouncements: In August 2018, the SEC adopted amendments to
certain financial statement disclosure requirements of Regulation S-X to
conform them to GAAP for investment companies. The final rule became
effective on November 5, 2018. All required changes have been made in
accordance with Regulation S-X.
In August 2018, the FASB issued Accounting Standards Update ("ASU")
No. 2018-13 "Disclosure Framework -- Changes to the Disclosure Requirements
for Fair Value Measurement". The ASU eliminates, modifies, and adds
disclosure requirements for fair value measurements and is effective for
fiscal years, and interim periods within those fiscal years, beginning after
December 15, 2019. The ASU allows for early adoption of either the entire
standard or only the provisions that eliminate or modify the requirements.
Management has elected to early adopt the provisions that eliminate
disclosure requirements and is still evaluating the impact of applying the
rest of the ASU.
Note 3. Investment Advisory and Management Agreement, Distribution Agreement
and Service Agreement
The Trust, on behalf of each Fund, has an Investment Advisory and Management
Agreement (the "Agreement") with SunAmerica. Under the Agreement, SunAmerica
provides continuous supervision of a Fund's portfolio and administers its
corporate affairs, subject to general review by the Trustees. In connection
therewith, SunAmerica furnishes the Funds with office facilities, maintains
certain of the Funds' books and records, and pays the salaries and expenses
of all personnel, including officers of the Funds, who are employees of
SunAmerica and its affiliates.
74
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
The Funds pay SunAmerica a monthly investment advisory and management fee
calculated daily at the following annual percentages of each Fund's average
daily net assets:
Management
Fund Assets Fees
---- ---------------------------- ----------
U.S. Government Securities........................ $0 - $200 million 0.650%
(greater than) $200 million 0.620
(greater than) $400 million 0.550
Strategic Bond(1)................................. $0 - $350 million 0.650
(greater than) $350 million 0.600
Flexible Credit(2)................................ $0 - $200 million 0.750
(greater than) $200 million 0.720
(greater than) $400 million 0.550
--------
(1)Effective May 1, 2018, the Advisor contractually agreed to waive its
advisory fee with respect to the AIG Strategic Bond Fund so that the
advisory fee payable by the Fund to the Advisor under the agreement equals
0.40% on the first $350 million and 0.35% above $350 million of average
daily net assets. Effective November 19, 2018, the Advisor contractually
agreed to waive its advisory fee with respect to the AIG Strategic Bond Fund
through July 31, 2020 so that the advisory fee payable by the Fund to the
Advisor under the agreement equals 0.38% on the first $350 million and 0.33%
above $350 million of average daily net assets.
(2)The Advisor contractually agreed to waive its advisory fee with respect to
the AIG Flexible Credit Fund so that the advisory fee payable by the Fund to
the Advisor under the agreement equals 0.36% of average daily net assets.
Effective November 19, 2018, the Advisor contractually agreed to waive its
advisory fee with respect to the AIG Flexible Credit Fund through July 31,
2020 so that the advisory fee payable by the Fund to the Advisor under the
agreement equals 0.34% of average daily net assets.
For the year ended March 31, 2019 the amount of investment advisory fees
waived for Strategic Bond Fund and Flexible Credit Fund were $695,934 and
$1,262,897, respectively. These amounts are reflected in the Statement of
Operations.
The organizations described below act as subadvisers to the Trust and
certain of its Funds pursuant to Subadvisory Agreements with SAAMCo. Under
the Subadvisory Agreements, the subadvisers manage the investment and
reinvestment of the assets of the respective Funds for which they are
responsible.
Each of the subadvisers is independent of SAAMCo and discharges its
responsibilities subject to the policies of the Trust's Trustees and the
oversight and supervision of SAAMCo, which pays the subadvisers' fees.
Subadviser Fund
---------- ---------------
PineBridge Investments, LLC.... Strategic Bond
Newfleet Asset Management, LLC. Flexible Credit
SunAmerica has contractually agreed to waive fees and/or reimburse expenses,
to the extent necessary to cap the Funds' annual fund operating expenses at
the following percentages of each Fund's average net assets. For the
purposes of waived fees and/or reimbursed expense calculations, annual Fund
operating expenses shall not include extraordinary expenses (i.e., expenses
that are unusual in nature and infrequent in occurrence, such as
litigation), or acquired Fund fees and expenses, brokerage commissions and
other transactional expenses relating to the purchase and sale of portfolio
securities, interest, taxes and governmental fees, and other expenses not
incurred in the ordinary course of a Fund's business. The contractual fee
waivers and expense reimbursements will continue indefinitely, subject to
termination by the Trustees, including a majority of the Disinterested
Trustees.
Fund Percentage
---- ----------
U.S. Government Securities Class A..... 0.99%
U.S. Government Securities Class C..... 1.64
Strategic Bond Class A................. 1.40
Strategic Bond Class B................. 2.05
Strategic Bond Class C................. 2.05
Strategic Bond Class W................. 1.20
Flexible Credit Class A................ 1.45
Flexible Credit Class C................ 2.10
Flexible Credit Class W................ 1.25
For the U.S. Government Securities Fund, any contractual waivers and/or
reimbursements made by SunAmerica are subject to recoupment from the Fund
within two years after the occurrence of the waivers and/or reimbursements,
provided that the Fund is
75
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
able to effect such payment to SunAmerica and remain in compliance with the
expense limitations in effect at the time the waivers and/or reimbursements
were made.
For the year ended March 31, 2019, pursuant to the contractual expense
limitations in the above tables SunAmerica has waived and/or reimbursed
expenses as follows:
Other Expenses
Fund Reimbursed
---- --------------
U.S. Government Securities......... $185,070
Class Specific
Fund Expenses
---- --------------
U.S. Government Securities Class A. $306,262
U.S. Government Securities Class C. 33,551
At March 31, 2019, expenses previously waived or reimbursed by SunAmerica
that are subject to recoupment and expire during the time period indicated
are as follows:
Other Expenses Reimbursed
----------------------------------
Fund March 31, 2020 March 31, 2021
---- -------------- --------------
U.S. Government Securities........................ $180,779 $185,070
Class Specific Expenses Reimbursed
----------------------------------
Fund March 31, 2020 March 31, 2021
---- -------------- --------------
U.S. Government Securities Class A................ $362,838 $306,262
U.S. Government Securities Class C................ 54,695 33,551
The Trust, on behalf of each Fund, has entered into a Distribution Agreement
with AIG Capital Services, Inc. ("ACS" or "Distributor"), an affiliate of
the Adviser. Each Fund has adopted a Distribution Plan on behalf of each
Class (other than Class W shares of the Strategic Bond and Flexible Credit
Funds), in accordance with the provisions of Rule 12b-1 under the 1940 Act
(each, a "Plan," and collectively, the "Plans"), hereinafter referred to as
the "Class A Plan," the "Class B Plan" and the "Class C Plan." In adopting
the Class A Plan, the Class B Plan and the Class C Plan, the Trustees
determined that there was a reasonable likelihood that each such Plan would
benefit the Trust and the shareholders of the respective class. The sales
charge and distribution fees of a particular class will not be used to
subsidize the sale of shares of any other class.
The Class A, Class B and Class C Plans provide that the Trust, on behalf of
the respective classes, shall pay the Distributor a distribution fee at an
annual rate of up to 0.10%, 0.75% and 0.75%, of average daily net assets of
such Fund's Class A, Class B and Class C shares, respectively, to compensate
the Distributor and certain securities firms for providing sales and
promotional activities for distributing that class of shares. The
distribution costs for which the Distributor may be compensated include fees
paid to broker-dealers that have sold Fund shares, commissions, and other
expenses such as those incurred for sales literature, prospectus printing
and distribution and compensation to wholesalers. It is possible that in any
given year, the amount paid to the Distributor under the Class A Plan,
Class B Plan or Class C Plan may exceed the Distributor's distribution costs
as described above. Except for Class W shares of the Strategic Bond and
Flexible Credit Funds, the Plans also provide that each class of shares of
the Trust will also pay the Distributor an account maintenance fee at the
annual rate of up to 0.25% of the aggregate average daily net assets of such
class of shares to compensate the Distributor and securities firms for
account maintenance activities. The Distributor does not receive or retain
any distribution and/or account maintenance fees for any shares when the
shareholder does not have a broker of record. For the year ended March 31,
2019, ACS received fees as reflected in the Statements of Operations based
on the aforementioned rates.
The Trust, on behalf of the Strategic Bond and Flexible Credit Funds, has
entered into an Administrative and Shareholder Services Agreement with ACS,
pursuant to which ACS is paid an annual fee of 0.15% of average daily net
assets of Class W shares as compensation for providing additional
shareholder services to Class W shareholders. The Distributor does not
receive or retain any distribution and/or account maintenance fees for any
shares when the shareholder does not have a broker of record. For the year
ended March 31, 2019, ACS earned fees as reflected in the Statements of
Operations based on the aforementioned rate.
76
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
ACS receives sales charges on each Fund's Class A shares, portions of which
are reallowed to affiliated broker-dealers and non-affiliated
broker-dealers. ACS also receives the proceeds of contingent deferred sales
charges paid by investors in connection with certain redemptions of Class A,
Class B and Class C shares. ACS has advised the Funds that for the year
ended March 31, 2019, the proceeds received from Class A sales (and paid out
to affiliated and non-affiliated broker-dealers) and Class A, Class B and
Class C redemptions were as follows:
Class A Class B Class C
---------------------------------------------------- ------------- -------------
Contingent Contingent Contingent
Sales Affiliated Non-affiliated Deferred Deferred Deferred
Fund Charges Broker-dealers Broker-dealers Sales Charges Sales Charges Sales Charges
---- -------- -------------- -------------- ------------- ------------- -------------
U.S. Government Securities......... $ 17,659 $ 2,920 $ 11,919 $ 59 $ -- $1,187
Strategic Bond..................... 99,271 63,173 16,817 40,870 52,082 7,135
Flexible Credit.................... 333,826 33,252 244,032 31,761 -- 9,858
The Trust has entered into a Service Agreement with AIG Fund Services, Inc.
("AFS"), an affiliate of the Adviser. Under the Service Agreement, AFS
performs certain shareholder account functions by assisting the Funds'
transfer agent, DST Asset Manager Solutions, Inc. ("DST") in connection with
the services that it offers to the shareholders of the Funds. The Service
Agreement permits the Funds to compensate AFS for services rendered, based
upon an annual rate of 0.22% of average daily net assets, which is approved
annually by the Trustees. For the year ended March 31, 2019, the Funds
incurred the following expenses which are included in transfer agent fees
and expenses in the Statements of Operations to compensate AFS pursuant to
the terms of the Service Agreement:
Payable at
Fund Expenses March 31, 2019
---- -------- --------------
U.S. Government Securities Class A........... $286,310 $23,628
U.S. Government Securities Class C........... 15,841 1,419
Strategic Bond Class A....................... 368,189 28,594
Strategic Bond Class B....................... 39,916 3,048
Strategic Bond Class C....................... 130,210 10,008
Strategic Bond Class W....................... 119,947 9,599
Flexible Credit Class A...................... 285,124 22,418
Flexible Credit Class C...................... 123,386 10,326
Flexible Credit Class W...................... 312,000 24,816
At March 31, 2019, AIG Active Allocation Portfolio and AIG Multi-Asset
Allocation Portfolio, each a series of SunAmerica Series, Inc., owned a
percentage of the outstanding shares of the following Funds:
Holder
---------------------
AIG AIG
Active Multi-Asset
Allocation Allocation
Fund Portfolio Portfolio
---- ---------- -----------
U.S. Government Securities................... 13.10% 18.25%
Strategic Bond............................... 1.90 1.93
Flexible Credit.............................. 2.52 3.79
Note 4. Purchases and Sales of Investment Securities
The cost of purchases and proceeds from sales and maturities of long-term
investments during the year ended March 31, 2019 were as follows:
Purchases of Investment Sales of Investment Purchase of U.S. Sales of U.S.
Securities (Excluding U.S. Securities (Excluding U.S. Government Government
Fund Government Securities) Government Securities) Securities Securities
---- -------------------------- -------------------------- ---------------- -------------
U.S. Government Securities......... $ -- $ -- $ 23,926,949 $35,436,496
Strategic Bond..................... 230,462,652 361,554,915 125,311,578 82,372,676
Flexible Credit.................... 182,584,536 186,266,583 -- --
77
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
Note 5. Federal Income Taxes
The following details the tax basis of distributions as well as the
components of distributable earnings. The tax basis components of
distributable earnings differ from the amounts reflected in the Statements
of Assets and Liabilities by temporary book/tax differences primarily
arising from wash sales, post October capital losses, late year ordinary
losses, distributions payable, straddle loss deferrals, amortization of
premium/discount and treatment of defaulted securities.
Distributable Earnings Tax Distributions
For the year ended March 31, 2019 For the year ended March 31, 2019
---------------------------------------- ---------------------------------
Long-term Unrealized
Ordinary Gains/Capital Appreciation Ordinary Long-Term
Fund Income Loss Carryover (Depreciation)* Income Capital Gains
---- ---------- -------------- --------------- ----------- -------------
U.S. Government Securities. $ 583,828 $(20,760,887) $ 3,513,319 $ 2,274,447 $ --
Strategic Bond............. 265,906 (29,106,480) (3,238,024) 13,933,983 --
Flexible Credit............ 1,452,890 (8,341,072) (10,540,898) 17,530,127 --
--------
* Unrealized appreciation (depreciation) includes amounts for derivatives and
other assets and liabilities denominated in foreign currency.
Tax Distributions
For the year ended March 31, 2018
---------------------------------
Ordinary Long-Term
Fund Income Capital Gains
---- ----------- -------------
U.S. Government Securities. $ 2,661,495 $ --
Strategic Bond............. 10,179,966 --
Flexible Credit............ 16,843,293 --
As of March 31, 2019, for Federal income tax purposes, the Funds indicated
below have capital loss carryforwards which are available to offset future
capital gains, if any:
Unlimited
-----------------------
Fund ST LT
---- ----------- -----------
U.S. Government Securities. $13,869,489 $ 6,891,398
Strategic Bond............. 7,290,177 21,816,303
Flexible Credit............ 316,999 8,024,073
Under the current law, capital losses realized after October 31 and late
year ordinary losses may be deferred and treated as occurring on the first
day of the following year. For the fiscal year ended March 31, 2019, the
Funds elected to defer late year ordinary losses and post October capital
losses as follows:
Deferred Deferred
Deferred Post-October Post-October
Late Year Short-Term Long-Term
Fund Ordinary Loss Capital Loss Capital Loss
---- ------------- ------------ ------------
U.S. Government Securities. $ -- $ -- $ 158,358
Strategic Bond............. -- 937,916 2,311,945
Flexible Credit............ 778 1,038,999 1,764,229
For the period ended March 31, 2019, the reclassifications arising from
book/tax differences resulted in increases (decreases) that were primarily
due to net paydown adjustments, amortization of discount/premium, treatment
of litigation payments and treatment of foreign currency to the components
of net assets as follows:
Accumulated Accumulated
Undistributed Net Undistributed Net
Investment Income Realized Gain
Fund (Loss) (Loss) Capital Paid-in
---- ----------------- ----------------- ---------------
U.S. Government Securities. $ 600,159 $ (600,159) $ --
Strategic Bond............. 2,609,685 (2,609,685) --
Flexible Credit............ 341,465 (341,465) --
78
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
The amounts of aggregate unrealized gain (loss) and the cost of investment
securities for federal tax purposes, including short-term securities and
repurchase agreements, were as follows:
Aggregate Aggregate Unrealized
Unrealized Unrealized Gain/(Loss) Cost of
Fund Gain Loss Net Investments
---- ---------- ------------ ------------ ------------
U.S. Government Securities. $5,319,927 $ (1,806,608) $ 3,513,319 $130,604,817
Strategic Bond............. 5,374,023 (8,609,393) (3,235,370) 280,062,054
Flexible Credit Bond....... 2,954,262 (13,495,160) (10,540,898) 336,195,066
Note 6. Capital Share Transactions
Transactions in capital shares of each class of each Fund were as follows:
U.S. Government Securities
--------------------------------------------------
Class A
--------------------------------------------------
For the For the
year ended year ended
March 31, 2019 March 31, 2018
------------------------ ------------------------
Shares Amount Shares Amount
---------- ------------ ---------- ------------
Shares
sold.............. 1,305,310 $ 11,619,748 2,064,742 $ 18,744,689
Reinvested
dividends......... 224,390 1,998,259 244,835 2,226,713
Shares
redeemed.......... (3,096,467) (27,568,802) (3,295,222) (29,980,480)
---------- ------------ ---------- ------------
Net
increase
(decrease)
in
shares
outstanding
before
automatic
conversion........ (1,566,767) (13,950,795) (985,645) (9,009,078)
---------- ------------ ---------- ------------
Shares
issued/(reaquired)
upon
automatic
conversion........ 23,545 209,813 251,595 2,244,225
---------- ------------ ---------- ------------
Net
increase
(decrease)........ (1,543,222) $(13,740,982) (734,050) $ (6,764,853)
========== ============ ========== ============
U.S. Government Securities
--------------------------------------------------
Class C
--------------------------------------------------
For the For the
year ended year ended
March 31, 2019 March 31, 2018
------------------------ ------------------------
Shares Amount Shares Amount
---------- ------------ ---------- ------------
Shares
sold.............. 369,217 $ 3,282,505 166,535 $ 1,513,933
Reinvested
dividends......... 7,423 66,105 16,706 152,011
Shares
redeemed.......... (376,463) (3,350,519) (1,220,794) (11,055,024)
---------- ------------ ---------- ------------
Net
increase
(decrease)
in
shares
outstanding
before
automatic
conversion........ 177 (1,909) (1,037,553) (9,389,080)
---------- ------------ ---------- ------------
Shares
issued/(reaquired)
upon
automatic
conversion........ (23,556) (209,813) (251,877) (2,244,225)
---------- ------------ ---------- ------------
Net
increase
(decrease)........ (23,379) $ (211,722) (1,289,430) $(11,633,305)
========== ============ ========== ============
79
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
Strategic Bond
---------------------------------------------------------------------------------------------------------
Class A Class B
---------------------------------------------------- ---------------------------------------------------
For the For the For the For the
year ended year ended year ended year ended
March 31, 2019 March 31, 2018 March 31, 2019 March 31, 2018
------------------------- ------------------------- ------------------------- ------------------------
Shares Amount Shares Amount Shares Amount Shares Amount
----------- ------------ ----------- ------------ ----------- ------------ ---------- ------------
Shares
sold.............. 6,137,118 $ 20,175,849 17,768,850 $ 60,673,967 2,455,767 $ 7,927,642 869,650 $ 2,985,386
Reinvested
dividends......... 2,184,483 7,131,471 1,317,545 4,531,780 191,319 624,130 159,576 548,783
Shares
redeemed.......... (20,482,979) (67,579,745) (11,040,002) (37,839,522) (4,158,057) (13,615,211) (3,164,306) (10,869,331)
----------- ------------ ----------- ------------ ----------- ------------ ---------- ------------
Net
increase
(decrease)
in
shares
outstanding
before
automatic
conversion........ (12,161,378) (40,272,425) 8,046,393 27,366,225 (1,510,971) (5,063,439) (2,135,080) (7,335,162)
----------- ------------ ----------- ------------ ----------- ------------ ---------- ------------
Shares
issued/(reaquired)
upon
automatic
conversion........ 366,229 1,211,029 2,203,185 7,433,676 (134,725) (442,850) (146,651) (502,679)
----------- ------------ ----------- ------------ ----------- ------------ ---------- ------------
Net
increase
(decrease)........ (11,795,149) $(39,061,396) 10,249,578 $ 34,799,901 (1,645,696) $ (5,506,289) (2,281,731) $ (7,837,841)
=========== ============ =========== ============ =========== ============ ========== ============
Strategic Bond
---------------------------------------------------------------------------------------------------------
Class C Class W
---------------------------------------------------- ---------------------------------------------------
For the For the For the For the
year ended year ended year ended year ended
March 31, 2019 March 31, 2018 March 31, 2019 March 31, 2018
------------------------- ------------------------- ------------------------- ------------------------
Shares Amount Shares Amount Shares Amount Shares Amount
----------- ------------ ----------- ------------ ----------- ------------ ---------- ------------
Shares
sold.............. 3,276,843 $ 10,600,251 3,141,993 $ 10,844,054 8,629,513 $ 28,185,244 14,598,225 $ 50,166,169
Reinvested
dividends......... 576,785 1,887,304 598,701 2,067,953 529,292 1,725,791 317,651 1,091,699
Shares
redeemed.......... (8,736,270) (28,825,160) (18,342,484) (62,839,028) (14,054,707) (46,263,984) (5,987,746) (20,513,498)
----------- ------------ ----------- ------------ ----------- ------------ ---------- ------------
Net
increase
(decrease)
in
shares
outstanding
before
automatic
conversion........ (4,882,642) (16,337,605) (14,601,790) (49,927,021) (4,895,902) (16,352,949) 8,928,130 30,744,370
----------- ------------ ----------- ------------ ----------- ------------ ---------- ------------
Shares
issued/(reaquired)
upon
automatic
conversion........ (230,990) (768,179) (2,044,542) (6,930,997) -- -- -- --
----------- ------------ ----------- ------------ ----------- ------------ ---------- ------------
Net
increase
(decrease)........ (5,113,632) $(17,105,784) (16,646,332) $(56,858,018) (4,895,902) $(16,352,949) 8,928,130 $ 30,744,370
=========== ============ =========== ============ =========== ============ ========== ============
Flexible Credit
----------------------------------------------------
Class A
----------------------------------------------------
For the For the
year ended year ended
March 31, 2019 March 31, 2018
------------------------- -------------------------
Shares Amount Shares Amount
----------- ------------ ----------- ------------
Shares
sold.............. 14,849,818 $ 49,790,556 14,447,556 $ 49,649,962
Reinvested
dividends......... 1,886,508 6,285,170 1,805,509 6,214,632
Shares
redeemed.......... (19,823,318) (66,203,996) (20,023,513) (68,775,062)
----------- ------------ ----------- ------------
Net
increase
(decrease)
in
shares
outstanding
before
automatic
conversion........ (3,086,992) (10,128,270) (3,770,448) (12,910,468)
----------- ------------ ----------- ------------
Shares
issued/(reaquired)
upon
automatic
conversion........ 97,761 327,120 815,980 2,782,490
----------- ------------ ----------- ------------
Net
increase
(decrease)........ (2,989,231) $ (9,801,150) (2,954,468) $(10,127,978)
=========== ============ =========== ============
80
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
Flexible Credit
----------------------------------------------------------------------------------------------------------
Class C Class W
-------------------------------------------------- ------------------------------------------------------
For the For the For the For the
year ended year ended year ended year ended
March 31, 2019 March 31, 2018 March 31, 2019 March 31, 2018
------------------------ ------------------------ -------------------------- --------------------------
Shares Amount Shares Amount Shares Amount Shares Amount
---------- ------------ ---------- ------------ ----------- ------------- ----------- -------------
Shares
sold.............. 4,471,353 $ 14,963,070 4,346,092 $ 15,053,291 34,991,418 $ 117,435,247 21,898,961 $ 75,416,969
Reinvested
dividends......... 562,371 1,884,631 619,069 2,143,889 1,333,966 4,447,946 1,071,044 3,689,146
Shares
redeemed.......... (5,521,122) (18,531,010) (8,376,293) (28,931,981) (33,731,044) (111,902,255) (30,165,932) (103,923,875)
---------- ------------ ---------- ------------ ----------- ------------- ----------- -------------
Net
increase
(decrease)
in
shares
outstanding
before
automatic
conversion........ (487,398) (1,683,309) (3,411,132) (11,734,801) 2,594,340 9,980,938 (7,195,927) (24,817,760)
---------- ------------ ---------- ------------ ----------- ------------- ----------- -------------
Shares
issued/(reaquired)
upon
automatic
conversion........ (97,135) (327,120) (811,222) (2,782,490) -- -- -- --
---------- ------------ ---------- ------------ ----------- ------------- ----------- -------------
Net
increase
(decrease)........ (584,533) $ (2,010,429) (4,222,354) $(14,517,291) 2,594,340 $ 9,980,938 (7,195,927) $ (24,817,760)
========== ============ ========== ============ =========== ============= =========== =============
Note 7. Line of Credit
The Trust has access to a $75 million committed unsecured line of credit
and, along with certain other funds managed by the Adviser, a $50 million
uncommitted unsecured line of credit. The committed and uncommitted lines of
credit are renewable on an annual basis with State Street Bank and Trust
Company ("State Street"), the Trust's custodian. Interest is currently
payable on the committed line of credit at the higher of the Federal Funds
Rate (but not less than zero) plus 125 basis points or the One-Month London
Interbank Offered Rate (but not less than zero) plus 125 basis points and
State Street's discretionary bid rate on the uncommitted line of credit. The
Trust, on behalf of each of the Funds, has paid State Street for its own
account, such Fund's ratable portion of an upfront fee in an amount equal to
$25,000 in the aggregate for the uncommitted line of credit made available
by State Street to certain other funds managed by the Adviser, which are
also party to the uncommitted line of credit. There is also a commitment fee
of 25 basis points per annum on the daily unused portion of the committed
line of credit. Borrowings under the line of credit will commence when the
respective Fund's cash shortfall exceeds $100,000.
For the year ended March 31, 2019, the following Funds had borrowings:
Days Interest Debt Average
Fund Outstanding Charges Utilized Interest
---- ----------- -------- ---------- --------
Strategic Bond........... 24 $ 2,677 $1,177,588 3.55%
Flexible Credit.......... 38 15,857 4,133,792 3.62
At March 31, 2019, there were no borrowings outstanding.
Note 8. Interfund Lending Agreement
Pursuant to the exemptive relief granted by the Securities and Exchange
Commission, the Funds are permitted to participate in an interfund lending
program among investment companies advised by SunAmerica or an affiliate.
The interfund lending program allows the participating Funds to borrow money
from and lend money to each other for temporary or emergency purposes. An
interfund loan will be made under this facility only if the participating
Funds receive a more favorable interest rate than would otherwise be
available from a typical bank for a comparable transaction. For the year
ended March 31, 2019, none of the Funds participated in this program.
Note 9. Investment Concentration
The Flexible Credit Fund's investment in high yield securities, whether
rated or unrated, may be considered speculative and subject to greater
market fluctuations and risk of loss of income and principal than
lower-yielding, higher-rated, fixed-income securities. The risk of loss due
to default by the issuer may be significantly greater for the holders of
high yield securities, because such securities are generally unsecured and
are often subordinated to other creditors of the issuer.
81
SunAmerica Income Funds
NOTES TO FINANCIAL STATEMENTS -- March 31, 2019 -- (continued)
The Flexible Credit Fund and Strategic Bond Fund invest in participations
and assignments, or act as a party to the primary lending syndicate of a
variable rate senior loan interest to United States corporations,
partnerships, and other entities. If the lead lender in a typical lending
syndicate becomes insolvent, enters receivership or, if not FDIC insured,
enters into bankruptcy, a Fund may incur certain costs and delays in
receiving payment, or may suffer a loss of principal and/or interest. When a
Fund purchases a participation of a senior loan interest, the Fund typically
enters into a contractual agreement with the lender or other third party
selling the participation but not with the borrower directly. As such, a
Fund is subject to the credit risk of the borrower, selling participant,
lender or other persons positioned between the Funds and the borrower.
Each Fund may invest in obligations issued by agencies and instrumentalities
of the U.S. Government that may vary in the level of support they receive
from the government. The government may choose not to provide financial
support to government sponsored agencies or instrumentalities if it is not
legally obligated to do so, and if the issuer defaulted, a fund holding
securities of such issuer might not be able to recover its investment from
the U.S. Government. As a result of the U.S. Government Fund's concentration
in such investments, it may be subject to risks associated with U.S.
Government agencies or instrumentalities.
Note 10. Unfunded Loan Commitments
At March 31, 2019, AIG Strategic Bond Fund had the following unfunded loan
commitments which could be extended at the option of the Borrower:
Principal
Borrower Type Maturity Date Amount Value
-------- ------------ ------------- --------- -------
Mavis Tire Express Services Corp.. Delayed Draw 03/20/2025 $15,925 $15,547
82
SunAmerica Income Funds
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Trustees of SunAmerica Income Funds and Shareholders of each of
the funds listed in the table below
Opinions on the Financial Statements
We have audited the financial statements and financial highlights of each of
the funds listed in the table below (constituting SunAmerica Income Funds,
hereafter collectively referred to as the "Funds") as of the date listed in the
table below and for the periods listed in the table below (collectively
referred to as the "financial statements"). In our opinion, the financial
statements present fairly, in all material respects, the financial position of
each of the Funds as of the date listed in the table below, the results of each
of their operations, the changes in each of their net assets and each of the
financial highlights for each of the periods listed in the table below in
conformity with accounting principles generally accepted in the United States
of America.
SunAmerica Income Funds
----------------------------------------
AIG Flexible Credit Fund (1)
----------------------------------------
AIG Strategic Bond Fund (1)
----------------------------------------
AIG U.S. Government Securities Fund (2)
----------------------------------------
(1)The statement of assets and liabilities, including the portfolio of
investments, as of March 31, 2019, the related statement of operations for
the year then ended, the statement of changes in net assets for each of the
two years in the period ended March 31, 2019, including the related notes,
and the financial highlights for each of the periods indicated therein
(2)The statement of assets and liabilities, including the portfolio of
investments, as of March 31, 2019, the related statement of operations for
the year then ended, the statement of changes in net assets for each of the
two years in the period ended March 31, 2019, including the related notes,
and the financial highlights for each of the five years in the period ended
March 31, 2019
Basis for Opinions
These financial statements are the responsibility of the Funds' management. Our
responsibility is to express an opinion on the Funds' financial statements
based on our audits. We are a public accounting firm registered with the Public
Company Accounting Oversight Board (United States) (PCAOB) and are required to
be independent with respect to the Funds in accordance with the U.S. federal
securities laws and the applicable rules and regulations of the Securities and
Exchange Commission and the PCAOB.
We conducted our audits of these financial statements in accordance with the
standards of the PCAOB. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material
misstatement of the financial statements, whether due to error or fraud, and
performing procedures that respond to those risks. Such procedures included
examining, on a test basis, evidence regarding the amounts and disclosures in
the financial statements. Our audits also included evaluating the accounting
principles used and significant estimates made by management, as well as
evaluating the overall presentation of the financial statements. Our procedures
included confirmation of securities owned as of March 31, 2019 by
correspondence with the custodian, transfer agent, brokers and selling or agent
banks; when replies were not received, we performed other auditing procedures.
We believe that our audits provide a reasonable basis for our opinions.
/s/ PricewaterhouseCoopers LLP
Houston, Texas
May 29, 2019
We have served as the auditor of one or more investment companies in the AIG
Funds family of funds since 1984.
83
SunAmerica Income Funds
TRUSTEE AND OFFICER INFORMATION -- March 31, 2019 -- (unaudited)
The following table contains basic information regarding the Trustees and
Officers that oversee operations of the Funds and other investment companies
within the Fund complex. Unless otherwise noted, the address of each Director
and executive officer is Harborside 5, 185 Hudson Street, Suite 3300, Jersey
City, NJ 07311.
Number of
Funds in
Position(s) Fund Complex Other Directorship(s)
Held With Length of Principal Occupation(s) Overseen by Held by Trustee
Name and Age Trust Time Served(1) During Past 5 Years Trustee(2) During Past Five Years(3)
--------------------- ----------- -------------- ------------------------------- ------------ ------------------------------
Disinterested Trustees
Dr. Judith L. Craven Trustee 2001- Retired. 73 Director A.G. Belo Corp.
Age: 73 present (media company) (1992 to
2014); Director, Sysco Corp.
(food marketing and
distribution company) (1996
to 2017); Director, Luby's,
Inc. (1998 to present).
William F. Devin Trustee 2001- Retired. 24 None
Age: 80 present
Richard W. Grant Trustee 2011- Retired. 24 None
Age: 73 Chairman present
of the
Board
Stephen J. Gutman Trustee 2001- Senior Vice President and 24 None
Age: 75 present Associate Broker, The
Corcoran Group (real estate)
(2002 to present); President,
SJG Marketing, Inc. (2009 to
present).
Eileen A. Kamerick Trustee 2018- National Association of 24 Hochschild Mining plc
Age: 60 present Corporate Directors Board (precious metals company)
Leadership Fellow and (2016 to Present); Associated
financial expert; Adjunct Banc-Corp (financial services
Professor of Law, University company) (2007 to Present);
of Chicago, Washington Legg Mason Closed End
University in St. Louis and Funds (registered investment
University of Iowa law companies) (2013 to
schools (2007 to Present); Present); Westell
formerly, Senior Advisor to Technologies, Inc.
the Chief Executive Officer (technology company) (2003
and Executive Vice President to 2016).
and Chief Financial Officer
of ConnectWise, Inc.
(software and services
company) (2015 to 2016);
Chief Financial Officer, Press
Ganey Associates (health
care informatics company)
(2012 to 2014).
84
SunAmerica Income Funds
TRUSTEE AND OFFICER INFORMATION -- March 31, 2019 -- (unaudited)
(continued)
Number of
Funds in
Position(s) Fund Complex Other Directorship(s)
Held With Length of Principal Occupation(s) Overseen by Held by Trustee
Name and Age Trust Time Served(1) During Past 5 Years Trustee(2) During Past Five Years(3)
-------------------- ----------- -------------- ----------------------------- ------------ -------------------------
Interested Trustee
Peter A. Harbeck(4) Trustee 2001- President (1995 to present), 150 None
Age: 64 present CEO (1997 to present), and
Director (1992 to present),
SunAmerica; Director, AIG
Capital Services, Inc.
("ACS") (1993 to present);
Chairman, President and
CEO, Advisor Group, Inc.
(2004 to 2016).
--------
(1)Trustees serve until their successors are duly elected and qualified.
(2)The term "Fund Complex" means two or more registered investment companies
that hold themselves out to investors as related companies for purposes of
investment services or have a common investment adviser or any investment
adviser that is an affiliate of the Adviser. The "Fund Complex" includes the
Trust (3 funds), SunAmerica Money Market Funds Inc. ("SAMMF") (1 fund),
SunAmerica Equity Funds ("SAEF") (2 funds), SunAmerica Senior Floating Rate
Fund, Inc. ("SASFRF") (1 fund), SunAmerica Series, Inc. ("SA Series") (6
funds), Anchor Series Trust ("AST") (5 portfolios), SunAmerica Specialty
Series (6 funds), SunAmerica Series Trust ("SAST") (58 portfolios), VALIC
Company I ("VALIC I") (34 funds), VALIC Company II ("VALIC II") (15 funds),
Seasons Series Trust ("SST") (19 portfolios).
(3)Directorships of companies required to report to the SEC under the
Securities Exchange Act of 1934 (i.e., "public companies") or other
investment companies registered under the 1940 Act.
(4)Mr. Harbeck is considered to be an Interested Trustee because he serves as
President, CEO and Director of SunAmerica and Director of ACS.
Additional information concerning the Trustees is contained in the Statement of
Additional Information which is available, without charge, by calling (800)
858-8850.
85
SunAmerica Income Funds
TRUSTEE AND OFFICER INFORMATION -- March 31, 2019 -- (unaudited)
(continued)
Position(s)
Held with Length of Principal Occupation(s)
Name and Age Trust Time Served During Past 5 Years
--------------------- ------------ ----------- ---------------------------------------------------------------------------
Officers
John T. Genoy President 2007- Chief Financial Officer, SunAmerica (2002 to present); Senior Vice
Age: 50 present President, SunAmerica (2004 to present); Chief Operating Officer,
SunAmerica (2006 to present).
Gregory R. Kingston Treasurer 2014- Vice President, SunAmerica (2001 to present); Head of Mutual Fund
Age: 53 present Administration, SunAmerica (2014 to present).
2919 Allen Parkway
Houston, Texas 77019
James Nichols Vice 2006- Director, President and CEO, ACS (2006 to present); Senior Vice President,
Age: 52 President present SunAmerica (2002 to present).
Gregory N. Bressler Secretary 2005- Senior Vice President and General Counsel, SunAmerica (2005 to present).
Age: 52 present
Kathleen D. Fuentes Chief Legal 2013- Vice President and Deputy General Counsel, SunAmerica (2006 to present).
Age: 50 Officer and present
Assistant
Secretary
Timothy P. Pettee Vice 2018 to Chief Investment Officer, SunAmerica (2018 to Present); Lead Portfolio
Age: 60 President Present Manager-Rules Based Funds (2013 to Present); Chief Investment Officer
(2003 to 2013)
Shawn Parry Vice 2014- Assistant Vice President, SunAmerica (2005 to 2014); Vice President,
Age: 46 President present SunAmerica (2014 to present).
2919 Allen Parkway and
Houston, Texas 77019 Assistant
Treasurer
Donna M. McManus Vice 2014- Managing Director, BNY Mellon (2009-2014); Vice President,
Age: 58 President present SunAmerica, (2014 to present).
and
Assistant
Treasurer
Christopher C. Joe Chief 2017 to Chief Compliance Officer, AIG Funds, Anchor Series Trust, Seasons
Age: 49 Compliance Present Series Trust, SunAmerica Series Trust, VALIC Company I and VALIC
2919 Allen Parkway Officer Company II (2017-Present); Chief Compliance Officer, VALIC Retirement
Houston, Texas 77019 Services Company (2017-Present); Chief Compliance Officer, The Variable
Annuity Life Insurance Company (2017 to Present); Chief Compliance
Officer, Invesco PowerShares (2012-2017); Chief Compliance Officer,
Invesco Investment Advisers, LLC (2010-2013); U.S. Compliance Director,
Invesco Ltd. (2006-2014); Deputy Chief Compliance Officer, Invesco
Advisers, LLC (2014-2015).
Matthew J. Hackethal Anti-Money 2006- Acting Chief Compliance Officer, AIG Funds, Anchor Series Trust, Seasons
Age: 47 Laundering present Series Trust, SunAmerica Series Trust, VALIC Company I and VALIC
("AML") Company II (2016 to 2017); Chief Compliance Officer, SunAmerica (2006
Compliance to Present); Chief Compliance Officer, The Variable Annuity Life Insurance
Officer Company (2016 to 2017); AML Compliance Officer, AIG Funds, Anchor
Series Trust, Seasons Series Trust, SunAmerica Series Trust, VALIC
Company I and VALIC Company II (2006 to Present); and Vice President,
SunAmerica (2011 to Present).
86
SunAmerica Income Funds
SHAREHOLDER TAX INFORMATION -- March 31, 2019 -- (unaudited)
Certain tax information regarding the Fund is required to be provided to
shareholders based upon each Fund's income and distributions for the taxable
year ended March 31, 2019. The information and distributions reported herein
may differ from the information and distributions taxable to the shareholders
for the calendar year ending December 31, 2019. The information necessary to
complete your income tax returns will be included with your Form 1099-DIV which
will be sent to shareholders in early 2020.
For the year ended March 31, 2019, the Funds paid the following long-term
capital gains dividends along with percentage of ordinary income dividends that
qualified for the dividends received deduction for corporations:
Net Qualifying % for the
Long-Term Dividends
Capital Gains Received Deduction
------------- --------------------
U.S. Government Securities Fund Class A. $-- -- %
U.S. Government Securities Fund Class C. -- --
Strategic Bond Fund Class A............. -- 0.46
Strategic Bond Fund Class B............. -- 0.46
Strategic Bond Fund Class C............. -- 0.46
Strategic Bond Fund Class W............. -- 0.46
Flexible Credit Fund Class A............ -- 0.35
Flexible Credit Fund Class C............ -- 0.35
Flexible Credit Fund Class W............ -- 0.35
For the year ended March 31, 2019, certain dividends paid by the Strategic Bond
Fund and Flexible Credit Fund may be subject to a maximum tax rate of 15%, as
provided by the Jobs and Growth Tax Relief Reconciliation Act of 2003. Of the
distributions paid during the fiscal year, the following represents the maximum
amount that may be considered qualified dividend income:
Amount
-------
Strategic Bond Fund.. $14,021
Flexible Credit Fund. 1,075
87
SunAmerica Income Funds
COMPARISONS: PORTFOLIOS vs. INDICES -- (unaudited)
As required by the Securities and Exchange Commission, the graphs on the
following pages compare the performance of a $10,000 investment in the
SunAmerica Income Funds' portfolios to a similar investment in an index. Please
note that "inception," as used herein, reflects the date on which a specific
class of shares commenced operations. It is important to note that the
SunAmerica Income Funds are professionally managed mutual funds, while the
indices are not available for investment and are unmanaged. The comparison is
shown for illustrative purposes only. The graphs present the performance of
Class A shares of each Fund. The performance of the other classes will vary
based upon the difference in sales charges and fees assessed to shareholders of
that class.
88
SunAmerica Income Funds
COMPARISONS: PORTFOLIOS vs. INDICES -- (unaudited) (continued)
AIG U.S. Government Securities Fund
The AIG U.S. Government Securities Fund Class A shares returned 2.71% (before
maximum sales charge) for the 12-month period ended March 31, 2019. The Fund
posted solid absolute returns but trailed its benchmark, the ICE BofAML U.S.
Treasury Index,/*/ which returned 4.25% during the same period.
During the annual period, the U.S. fixed income market experienced high levels
of supply through the U.S. Treasury Department issuing government bonds, the
Federal Reserve (the "Fed") normalizing its balance sheet,/**/ and corporations
issuing new bonds. The Fed raised short-term interest rates three times during
the annual period, increasing the targeted federal funds rate 75 basis points.+
This caused U.S. Treasury yields across the yield curve, or spectrum of
maturities, to move higher during the first half of the annual period, with the
10-year U.S. Treasury note hitting its highest yield of 3.23% in November 2018.
However, a revised Fed outlook toward the end of the annual period prompted
yields across the government securities and corporate bond sectors to fall, as
a heightened risk averse sentiment permeated the market. Near the end of the
annual period, the yield on the 10-year U.S. Treasury note hit a low of 2.36%,
as the market began pricing in the potential likelihood of an interest rate cut
by the Fed.
Amid this backdrop, our selection overall of longer-duration U.S. Treasury
holdings proved beneficial but was more than offset by the Fund's
underweighting compared to the ICE BofAML U.S. Treasury Index (the "benchmark
index") to this better performing segment of the U.S. Treasury yield curve,
which detracted. As the annual period progressed, we added Fund exposure to the
intermediate- and long-term segments of the U.S. Treasury yield curve. The
Fund's shorter duration in U.S. Treasuries compared to the benchmark index
helped during the first half of the annual period when yields moved higher but
detracted when yields moved lower in the last months of the annual period.
Also, the Fund's performance was significantly affected by holdings in GNMA
mortgage pools, which comprised a significant percentage of the Fund's net
assets during the annual period. The longer duration of these GNMA mortgage
pools made them more susceptible to shifts in interest rates and yield curve
movements. Given that rates remained relatively low during the first half of
the annual period, some of these holdings were prepaid, as the underlying
mortgages were either refinanced or paid off before rates moved higher and
other mortgage holdings' spreads, or yield differentials to duration-equivalent
U.S. Treasuries, widened along with rising rates. This eroded the value of
those holdings, causing them to detract from the Fund's relative results.
These detractors were partially offset by the Fund's selection of FNMA and
FHLBs, which are agency mortgage-backed securities that are not components of
the benchmark index and which outperformed U.S. Treasuries during the annual
period. Also, the Fund's mortgage holdings' overall shorter duration than that
of the benchmark index and the level of income non-seasoned mortgage-backed
securities holdings produced added value.
At the end of the annual period, the Fund had approximately 69% of its total
assets invested in U.S. Treasuries, 20% in GNMAs and 11% in other agency
mortgage-backed securities. As of March 31, 2019, the Fund had a shorter
duration than that of the benchmark index.
--------
Past performance is no guarantee of future results.
U.S. Government guarantee applies only to the underlying securities of the
Fund's portfolio and not to the Fund shares. Interest rates and bond prices
typically move inversely to each other; therefore, as with any bond fund, the
value of your investment in this Fund may go up or down in response to changes
in interest rates.
* The ICE BofAML U.S. Treasury Index tracks the performance of U.S. dollar
denominated sovereign debt publicly issued by the U.S. government in its
domestic market. Indices are not managed and an investor cannot invest
directly into an index.
**Balance sheet normalization refers to the steps the Fed will take to reverse
quantitative easing and remove the substantial monetary accommodation it has
provided to the economy since the financial crisis began in 2007.
+ A basis point is 1/100th of a percentage point.
Securities listed may or may not be a part of current Fund construction.
89
SunAmerica Income Funds
COMPARISONS: PORTFOLIOS vs. INDICES -- (unaudited) (continued)
Over the past ten years, $10,000 invested in AIG U.S. Government Securities
Fund Class A shares would have increased to $10,888. The same amount invested
in securities mirroring the performance of the ICE BofAML US Treasury Index
would be valued at $12,789.
[CHART]
AIG U.S. Government ICE BofAML
Date Securities Fund Class A/#/ US Treasury Index/*/*/
---------- -------------------------- ----------------------
3/31/2009 $ 9,525 $10,000
4/30/2009 9,373 9,810
5/31/2009 9,278 9,711
6/30/2009 9,289 9,692
7/31/2009 9,355 9,731
8/31/2009 9,431 9,821
9/30/2009 9,516 9,899
10/31/2009 9,525 9,893
11/30/2009 9,598 10,033
12/31/2009 9,375 9,768
1/31/2010 9,487 9,922
2/28/2010 9,509 9,961
3/31/2010 9,453 9,876
4/30/2010 9,546 9,981
5/31/2010 9,717 10,153
6/30/2010 9,879 10,342
7/31/2010 9,901 10,412
8/31/2010 10,092 10,625
9/30/2010 10,014 10,626
10/31/2010 9,937 10,607
11/30/2010 9,901 10,534
12/31/2010 9,772 10,342
1/31/2011 9,698 10,343
2/28/2011 9,737 10,334
3/31/2011 9,748 10,328
4/30/2011 9,851 10,447
5/31/2011 9,986 10,612
6/30/2011 9,933 10,580
7/31/2011 10,086 10,773
8/31/2011 10,378 11,075
9/30/2011 10,583 11,252
10/31/2011 10,509 11,167
11/30/2011 10,601 11,248
12/31/2011 10,695 11,355
1/31/2012 10,703 11,406
2/29/2012 10,647 11,325
3/31/2012 10,561 11,208
4/30/2012 10,695 11,379
5/31/2012 10,851 11,588
6/30/2012 10,816 11,544
7/31/2012 10,918 11,667
8/31/2012 10,904 11,651
9/30/2012 10,868 11,611
10/31/2012 10,835 11,591
11/30/2012 10,863 11,658
12/31/2012 10,829 11,600
1/31/2013 10,708 11,490
2/28/2013 10,757 11,558
3/31/2013 10,755 11,571
4/30/2013 10,872 11,693
5/31/2013 10,586 11,457
6/30/2013 10,408 11,313
7/31/2013 10,339 11,291
8/31/2013 10,289 11,230
9/30/2013 10,326 11,316
10/31/2013 10,383 11,378
11/30/2013 10,320 11,330
12/31/2013 10,236 11,212
1/31/2014 10,393 11,391
2/28/2014 10,439 11,426
3/31/2014 10,420 11,394
4/30/2014 10,489 11,465
5/31/2014 10,570 11,590
6/30/2014 10,572 11,572
7/31/2014 10,565 11,555
8/31/2014 10,714 11,696
9/30/2014 10,651 11,622
10/31/2014 10,766 11,748
11/30/2014 10,825 11,856
12/31/2014 10,822 11,887
1/31/2015 10,939 12,229
2/28/2015 10,885 12,016
3/31/2015 10,935 12,095
4/30/2015 10,905 12,020
5/31/2015 10,876 11,992
6/30/2015 10,778 11,872
7/31/2015 10,817 11,984
8/31/2015 10,811 11,991
9/30/2015 10,849 12,098
10/31/2015 10,831 12,055
11/30/2015 10,802 12,004
12/31/2015 10,797 11,986
1/31/2016 10,917 12,249
2/29/2016 10,966 12,370
3/31/2016 10,971 12,387
4/30/2016 10,975 12,372
5/31/2016 10,991 12,377
6/30/2016 11,109 12,664
7/31/2016 11,136 12,718
8/31/2016 11,106 12,645
9/30/2016 11,110 12,622
10/31/2016 10,977 12,477
11/30/2016 10,669 12,136
12/31/2016 10,627 12,122
1/31/2017 10,619 12,149
2/28/2017 10,656 12,212
3/31/2017 10,650 12,205
4/30/2017 10,701 12,291
5/31/2017 10,730 12,373
6/30/2017 10,699 12,354
7/31/2017 10,715 12,373
8/31/2017 10,766 12,513
9/30/2017 10,723 12,403
10/31/2017 10,704 12,389
11/30/2017 10,684 12,374
12/31/2017 10,699 12,417
1/31/2018 10,608 12,244
2/28/2018 10,550 12,147
3/31/2018 10,601 12,267
4/30/2018 10,544 12,167
5/31/2018 10,617 12,277
6/30/2018 10,607 12,281
7/31/2018 10,573 12,225
8/31/2018 10,624 12,320
9/30/2018 10,544 12,200
10/31/2018 10,500 12,136
11/30/2018 10,575 12,245
12/31/2018 10,723 12,517
1/31/2019 10,774 12,575
2/28/2019 10,752 12,540
3/31/2019 10,888 12,789
AIG U.S. Government Securities Fund
Class A@ Class C
----------------- ------------------ ------------------
Average Average
Annual Cumulative Annual Cumulative
Return Return+ Return Return+
----------------- ------- ---------- ------- ----------
1 Year Return -2.20% 2.71% 1.05% 2.05%
-------------------------------------------------------
5 Year Return -0.09% 4.49% 0.25% 1.27%
-------------------------------------------------------
10 Year Return 0.85% 14.32% 0.70% 7.25%
-------------------------------------------------------
Since Inception* 3.76% 168.95% 2.89% 76.02%
-------------------------------------------------------
+ Cumulative returns do not include sales load. If sales load had been
included, the return would be lower.
* Inception Date - Class A: 10/1/93; Class C: 06/1/99.
# For the purposes of the graph, it has been assumed that the maximum sales
charge of 4.75% of offering price was deducted from the initial $10,000
investment in the Fund. For purposes of the table, it has been assumed that
the maximum sales charge with respect to the Class A shares, was deducted
from the initial investment in the Fund and that the CDSCs with respect to
the Class C shares has been deducted, as applicable.
@ As of the close of business on December 2, 2014, Class B shares of the Fund
were no longer offered to new or existing shareholders, except that
dividends and/or capital gain distributions received by a shareholder from
the Fund continued to be automatically reinvested in additional Class B
shares of the Fund, at the net asset value per share in effect on the
payable date, unless the shareholder had elected to receive them in cash or
automatically reinvest them in any retail fund distributed by AIG Capital
Services, Inc. As of the close of business on January 27, 2015, all
outstanding Class B shares of the Funds were converted to Class A shares.
For the 12-month period ended March 31, 2019, the AIG U.S. Government
Securities Fund Class A returned -2.20%, compared to 4.25% for the ICE BofAML
US Treasury Index. (The performance table and graph do not reflect the
deduction of taxes that a shareholder would pay on fund distributions or the
redemption of fund shares.)
--------
Performance data quoted represents past performance and is no guarantee of
future results. Maximum Sales Charge: Class A: 4.75%, Class C: 1.00% CDSC. The
fund's daily net asset values are not guaranteed and shares are not insured by
the FDIC, the Federal Reserve Board or any other agency. The investment return
and principal value of an investment will fluctuate so that an investor's
shares, when redeemed, may be higher or lower than the original cost. Current
performance may be higher or lower than that shown. Performance as of the most
recent month end is available at www.aig.com/funds.
** The ICE BofAML U.S. Treasury Index tracks the performance of U.S. dollar
denominated sovereign debt publicly issued by the U.S. government in its
domestic market. Indices are not managed and an investor cannot invest
directly into an index.
90
SunAmerica Income Funds
COMPARISONS: PORTFOLIOS vs. INDICES -- (unaudited) (continued)
AIG Strategic Bond Fund
The AIG Strategic Bond Fund Class A shares returned 2.86% (before maximum sales
charge) for the 12-month period ended March 31, 2019. The Fund posted absolute
returns but underperformed its benchmark, the Bloomberg Barclays U.S. Aggregate
Bond Index,/*/ which returned 4.48% during the same annual period. The Fund
outperformed the LIBOR 3-Month Index,/*/ a widely recognized benchmark of
interest rate performance, which returned 2.49% for the same annual period.
The Fund's underperformance relative to its benchmark can be attributed to a
combination of sector allocation, country selection and issue selection.
Specifically, allocation positioning within the emerging markets debt sector
hurt relative results most. The Fund began the annual period with an overweight
to emerging markets debt, which detracted, as the sector weakened during the
second quarter of 2018. Waning investor appetite for emerging markets debt
against a backdrop of a stronger U.S. dollar and pockets of heightened
geopolitical risk, as well as negative fund flows, caused the sector to perform
poorly. We subsequently shifted to an underweight allocation to the sector,
which dampened performance during the third and fourth quarters of 2018. A
further reduction in the Fund's allocation to emerging markets debt at the
start of the first quarter of 2019 proved mis-timed, as this sector, along with
other riskier segments of the fixed income market, rallied during the first
calendar quarter. From an industry perspective, overweight allocations to basic
industry and government-owned names detracted most, while security selection
among credits within the energy and consumer cyclical industries dampened
results most. Security selection amongst sovereign debt securities also
detracted. While the Fund remained U.S.-centric, portions of the Fund were
allocated to non-U.S. dollar denominated sovereign and emerging market bonds.
Holdings in Argentina and Turkey detracted most from relative results.
Conversely, an overweight allocation to and security selection among high yield
bonds contributed most positively to the Fund's results. Having an underweight
allocation to U.S. Treasuries and an overweight allocation to sovereign debt
also boosted relative performance. From an industry allocation perspective,
credits within the communications and consumer non-cyclical industries helped
most. From a country selection perspective, holdings in Saudi Arabia and Egypt
added value. The only derivatives used in the period were FX forwards. These
instruments were used to hedge non-dollar developed markets corporate and
sovereign holdings. Hedging non-U.S. dollar currency exposure in the Fund
proved especially beneficial during the annual period.
Duration positioning detracted from the Fund's performance during the annual
period. The Fund maintained a shorter duration profile than that of the
Bloomberg Barclays U.S. Aggregate Bond Index, which hurt as intermediate- and
longer-term U.S. Treasury yields rallied, or fell, during the annual period.
Importantly, though, the Fund's duration stance was based more on decisions
related to sector allocation than to an outright bet on the path or direction
of interest rates. We maintained a preference within the Fund for leveraged
finance sectors, such as high yield bonds and floating rate bank loans, as we
felt their valuations were attractive throughout the annual period. Both high
yield bonds and bank loans carry a shorter duration when compared to the
Bloomberg Barclays U.S. Aggregate Bond Index, so the weighted average duration
of the Fund was comparably lower.
Among individual securities, positions in the issues of online real estate
services provider RentPath, oil and gas exploration and production company
Sanchez Energy and the Republic of Argentina detracted most from the Fund's
relative results. Positions in the issues of telecommunications and satellite
services company Intelsat Jackson, pharmaceuticals company Valeant
Pharmaceuticals and office supplies retailer Staples contributed most
positively to the Fund's relative performance during the annual period.
The Fund began the annual period with target allocations of 20% to investment
grade corporate bonds, 10% to securitized products, 40% to high yield bonds and
30% to emerging markets debt. As market conditions, including macroeconomic,
political, geopolitical and monetary policy factors, shifted, we adjusted
target allocations accordingly throughout the annual period. As of March 31,
2019, the Fund had target allocations of 25% to investment grade corporate
bonds, 25% to securitized products, 35% to high yield bonds and 15% to emerging
markets debt.
--------
Past performance is no guarantee of future results.
Interest rates and bond prices typically move inversely to each other;
therefore, as with any bond fund, the value of an investment in this Fund may
go up or down in response to changes in interest rates. High-yield bonds tend
to have lower interest rate risk than higher-quality bonds of similar maturity
but carry greater credit and default risk. Investing internationally involves
special risks, such as currency fluctuations and economic and political
instability.
*The Bloomberg Barclays U.S. Aggregate Bond Index represents securities that
are SEC-registered, taxable and dollar denominated. The index covers the U.S.
investment-grade fixed-rate bond market, with index components for government
and corporate securities, mortgage pass-through securities and asset-backed
securities. The LIBOR 3-Month Index is a benchmark interest rate that some of
the world's leading banks charge each other for short-term loans. It serves as
the first step to calculating interest rates on various loans throughout the
world and is published each day in five currencies: the Swiss franc, the euro,
the pound sterling, the Japanese yen, and the U.S. dollar. Indices are not
managed and an investor cannot invest directly into an index.
Securities listed may or may not be a part of current Fund construction.
91
SunAmerica Income Funds
COMPARISONS: PORTFOLIOS vs. INDICES -- (unaudited) (continued)
Over the past ten years, $10,000 invested in AIG Strategic Bond Fund Class A
shares would have increased to $18,186. The same amount invested in securities
mirroring the performance of the Bloomberg Barclays U.S. Aggregate Bond Index
and the LIBOR 3-Month Index would be valued at $14,472 and $10,754,
respectively.
[CHART]
AIG Strategic Bloomberg Barclays
Bond Fund U.S. Aggregate LIBOR
Date Class A/#/ Bond Index/*/*/ 3-Month Index/*/*/*/
---------- ------------- ------------------ --------------------
3/31/2009 $ 9,512 $10,000 $10,000
4/30/2009 10,023 10,048 10,010
5/31/2009 10,470 10,121 10,018
6/30/2009 10,672 10,178 10,024
7/31/2009 11,124 10,342 10,029
8/31/2009 11,293 10,450 10,033
9/30/2009 11,711 10,559 10,036
10/31/2009 11,806 10,611 10,038
11/30/2009 11,970 10,749 10,040
12/31/2009 12,011 10,581 10,042
1/31/2010 12,105 10,742 10,044
2/28/2010 12,153 10,783 10,046
3/31/2010 12,395 10,769 10,049
4/30/2010 12,600 10,881 10,051
5/31/2010 12,245 10,973 10,054
6/30/2010 12,454 11,145 10,059
7/31/2010 12,858 11,264 10,063
8/31/2010 12,998 11,409 10,067
9/30/2010 13,251 11,421 10,069
10/31/2010 13,505 11,462 10,072
11/30/2010 13,257 11,396 10,074
12/31/2010 13,410 11,273 10,077
1/31/2011 13,546 11,286 10,079
2/28/2011 13,675 11,314 10,082
3/31/2011 13,730 11,321 10,084
4/30/2011 13,983 11,464 10,087
5/31/2011 14,039 11,614 10,089
6/30/2011 13,896 11,580 10,091
7/31/2011 14,114 11,764 10,093
8/31/2011 13,811 11,936 10,096
9/30/2011 13,427 12,022 10,099
10/31/2011 13,895 12,035 10,102
11/30/2011 13,667 12,025 10,106
12/31/2011 13,887 12,157 10,111
1/31/2012 14,233 12,264 10,116
2/29/2012 14,450 12,261 10,120
3/31/2012 14,416 12,194 10,124
4/30/2012 14,589 12,329 10,128
5/31/2012 14,514 12,440 10,132
6/30/2012 14,644 12,445 10,135
7/31/2012 15,029 12,617 10,140
8/31/2012 15,120 12,625 10,143
9/30/2012 15,295 12,643 10,146
10/31/2012 15,387 12,667 10,150
11/30/2012 15,478 12,687 10,152
12/31/2012 15,563 12,669 10,155
1/31/2013 15,568 12,581 10,157
2/28/2013 15,612 12,644 10,159
3/31/2013 15,661 12,654 10,162
4/30/2013 15,970 12,782 10,164
5/31/2013 15,627 12,554 10,167
6/30/2013 15,105 12,360 10,169
7/31/2013 15,243 12,377 10,171
8/31/2013 15,073 12,313 10,173
9/30/2013 15,298 12,430 10,176
10/31/2013 15,571 12,530 10,178
11/30/2013 15,533 12,483 10,180
12/31/2013 15,612 12,413 10,182
1/31/2014 15,664 12,596 10,184
2/28/2014 15,934 12,663 10,186
3/31/2014 16,028 12,642 10,188
4/30/2014 16,170 12,748 10,190
5/31/2014 16,406 12,894 10,191
6/30/2014 16,504 12,900 10,193
7/31/2014 16,375 12,868 10,195
8/31/2014 16,567 13,010 10,197
9/30/2014 16,249 12,922 10,199
10/31/2014 16,348 13,049 10,201
11/30/2014 16,305 13,141 10,203
12/31/2014 16,124 13,153 10,206
1/31/2015 16,314 13,429 10,208
2/28/2015 16,456 13,303 10,210
3/31/2015 16,461 13,365 10,212
4/30/2015 16,560 13,317 10,214
5/31/2015 16,520 13,285 10,217
6/30/2015 16,288 13,140 10,219
7/31/2015 16,245 13,231 10,222
8/31/2015 16,058 13,212 10,224
9/30/2015 15,867 13,302 10,227
10/31/2015 16,111 13,304 10,230
11/30/2015 15,968 13,269 10,233
12/31/2015 15,681 13,226 10,238
1/31/2016 15,585 13,408 10,243
2/29/2016 15,633 13,503 10,248
3/31/2016 16,128 13,627 10,254
4/30/2016 16,427 13,679 10,259
5/31/2016 16,480 13,683 10,265
6/30/2016 16,680 13,928 10,270
7/31/2016 16,976 14,016 10,276
8/31/2016 17,174 14,000 10,283
9/30/2016 17,220 13,992 10,290
10/31/2016 17,118 13,885 10,298
11/30/2016 16,758 13,557 10,306
12/31/2016 16,897 13,576 10,314
1/31/2017 17,037 13,603 10,323
2/28/2017 17,275 13,694 10,331
3/31/2017 17,265 13,687 10,341
4/30/2017 17,418 13,792 10,350
5/31/2017 17,574 13,899 10,361
6/30/2017 17,574 13,885 10,372
7/31/2017 17,729 13,944 10,384
8/31/2017 17,829 14,069 10,395
9/30/2017 17,875 14,002 10,406
10/31/2017 17,972 14,010 10,418
11/30/2017 17,904 13,993 10,430
12/31/2017 17,992 14,057 10,444
1/31/2018 17,975 13,895 10,460
2/28/2018 17,747 13,763 10,475
3/31/2018 17,681 13,851 10,492
4/30/2018 17,570 13,748 10,513
5/31/2018 17,519 13,846 10,534
6/30/2018 17,467 13,829 10,553
7/31/2018 17,631 13,833 10,574
8/31/2018 17,586 13,922 10,595
9/30/2018 17,702 13,832 10,614
10/31/2018 17,391 13,723 10,637
11/30/2018 17,291 13,805 10,660
12/31/2018 17,246 14,058 10,685
1/31/2019 17,744 14,208 10,710
2/28/2019 17,963 14,199 10,732
3/31/2019 18,186 14,472 10,754
AIG Strategic Bond Fund
Class A Class B Class C Class W
----------------- ------------------ ------------------ ------------------ ------------------
Average Average Average Average
Annual Cumulative Annual Cumulative Annual Cumulative Annual Cumulative
Return Return+ Return Return+ Return Return+ Return Return+
----------------- ------- ---------- ------- ---------- ------- ---------- ------- ----------
1 Year Return -2.07% 2.86% -1.50% 2.43% 1.20% 2.18% 3.38% 3.38%
---------------------------------------------------------------------------------------------
5 Year Return 1.54% 13.47% 1.51% 9.66% 1.90% 9.88% N/A N/A
---------------------------------------------------------------------------------------------
10 Year Return 6.16% 91.19% 6.13% 81.24% 6.00% 79.14% N/A N/A
---------------------------------------------------------------------------------------------
Since Inception* 5.77% 337.21% 6.05% 333.93% 5.60% 290.48% 2.86% 12.49%
---------------------------------------------------------------------------------------------
+ Cumulative returns do not include sales load. If sales load had been
included, the return would be lower.
* Inception Date - Class A: 11/1/93; Class B: 04/1/94; Class C: 04/1/94; Class
W: 01/29/15.
# For the purposes of the graph, it has been assumed that the maximum sales
charge of 4.75% of offering price was deducted from the initial $10,000
investment in the Fund. For purposes of the table, it has been assumed that
the maximum sales charge with respect to the Class A shares, was deducted
from the initial investment in the Fund and that the CDSCs with respect to
the Class B and Class C shares have been deducted, as applicable.
For the 12-month period ended March 31, 2019, the AIG Strategic Bond Fund Class
A returned -2.07%, compared to 4.48% for the Bloomberg Barclays U.S. Aggregate
Bond Index and 2.49% for the LIBOR 3-Month Index. (The performance table and
graph do not reflect the deduction of taxes that a shareholder would pay on
fund distributions or the redemption of fund shares.)
--------
Performance data quoted represents past performance and is no guarantee of
future results. Maximum Sales Charge: Class A: 4.75%, Class B: 4.00% Contingent
Deferred Sales Charge (CDSC), Class C: 1.00% CDSC. Class B shares of the Fund
convert automatically to Class A shares approximately eight years after
purchase. The fund's daily net asset values are not guaranteed and shares are
not insured by the FDIC, the Federal Reserve Board or any other agency. The
investment return and principal value of an investment will fluctuate so that
an investor's shares, when redeemed, may be higher or lower than the original
cost. Current performance may be higher or lower than that shown. Performance
as of the most recent month end is available at www.aig.com/funds.
** The Bloomberg Barclays U.S. Aggregate Bond Index represents securities that
are SEC-registered, taxable and dollar denominated. The index covers the
U.S. investment-grade fixed-rate bond market, with index components for
government and corporate securities, mortgage pass-through securities and
asset-backed securities.
***The LIBOR 3-Month Index is a benchmark interest rate that some of the
world's leading banks charge each other for short-term loans. It serves as
the first step to calculating interest rates on various loans throughout the
world and is published each day in five currencies: the Swiss franc, the
euro, the pound sterling, the Japanese yen, and the U.S. dollar.
Indices are not managed and an investor cannot invest directly into an index.
92
SunAmerica Income Funds
COMPARISONS: PORTFOLIOS vs. INDICES -- (unaudited) (continued)
AIG Flexible Credit Fund
The AIG Flexible Credit Fund Class A shares returned 2.75% (before maximum
sales charge) for the 12-month period ended March 31, 2019. The Fund posted
positive absolute returns but underperformed its benchmark, the Flexible Credit
Blended Benchmark, composed 50% of the Bloomberg Barclays U.S. High Yield 2%
Issuer Capped Index/*/ and 50% of the S&P/LSTA Leveraged Loan Index,/*/ which
returned 4.45% during the same annual period. The Fund outperformed the ICE
BofAML USD 3-Mo Dep OR CM Index,/*/ a broad measure of market performance,
which returned 2.48% for the same annual period.
The Fund actively invests in high yield bonds and floating rate loans and has
the flexibility to allocate 0% to 100% of its portfolio to either sector of the
leveraged finance market. During the annual period, lower quality credit
sectors generally outperformed higher quality, and thus the Fund's higher
credit quality positioning detracted from its results relative to the Flexible
Credit Blended Benchmark. The Fund's modest overweight to floating rate loans
and corresponding underweight to high yield bonds also detracted from relative
performance.
Industry and security selection overall detracted from the Fund's relative
results. Overweights to manufacturing and consumer non-durables companies
within the Fund's floating rate loan allocation, as well as underweights to
communications and technology companies within the Fund's high yield bond
allocation detracted most significantly. Issue selection within the energy,
basic industry and communications industries hurt most within the Fund's high
yield bond allocation. Within the Fund's floating rate loan allocation, issue
selection in financials, forest products and consumer non-durables dampened
results most. Such detractors were somewhat offset by positive contributions
from overweights to consumer non-cyclical and finance companies within the
Fund's high yield bond allocation and by underweights to information technology
and media/telecom companies within the Fund's floating rate loan allocation.
Issue selection proved most effective in manufacturing and retail companies
within the Fund's floating rate loan allocation and in the consumer
non-cyclical and consumer cyclical industries within its high yield bond
allocation.
Among individual holdings, positions in the loans of asset manager and mortgage
servicer Walter Investment Management Group and glass container producer Anchor
Glass Container and the bonds of exploration and production operator Alta Mesa
Holdings detracted most from the Fund's relative results. Positions in the
loans of retail gift and loyalty card services provider CPI Card Group,
offshore drilling rig operator Seadrill Partners and hospital owner and
operator HCA, Inc. contributed most positively to the Fund's relative
performance during the annual period.
The Fund began the annual period with an approximate 53/47 allocation between
floating rate bank loans and high yield bonds, respectively. Early in the
annual period, we extended that overweight bringing the allocation to an
approximate 61/39 bank loans/high yield mix, as we continued to find the loan
market a compelling investment in light of what we considered to be a
still-strong fundamental picture, protection against rising interest rates and,
in turn, an attractive income carry profile,/**/ especially relative to high
yield bonds. We maintained that bias within the Fund through the majority of
2018. By the fourth quarter of 2018, loan prices had declined to their lowest
levels since July 2016. Our bias within the Fund was still toward loans but
more modestly so than earlier in the annual period, as high yield spreads, or
yield differentials to duration-equivalent U.S. Treasuries, had become more
attractive, in our view. During the first quarter of 2019, the Fund's mix
migrated toward a 54/46 loans/high yield mix, as the technical, or
supply/demand, environment in loans had started to weaken. We therefore sought
to reduce risk and take advantage of the improvement in prices in both markets.
As of March 31, 2019, the Fund had approximately a 51% allocation to loans and
approximately a 49% allocation to high yield bonds, maintaining just a slight
overweight to loans given the relative value created by differences in each
market's technical picture.
--------
Past performance is no guarantee of future results.
Interest rates and bond prices typically move inversely to each other;
therefore, as with any bond fund, the value of an investment in this Fund may
go up or down in response to changes in interest rates. High-yield bonds tend
to have lower interest-rate risk but may be subject to greater market
fluctuations and risk of default or loss of income and principal than
securities in higher rating categories. High-yield debt instruments carry a
greater default risk, may be more volatile, less liquid, more difficult to
value and more susceptible to adverse economic conditions or investor
perceptions than other debt instruments. Investments in floating rate loans
involve certain risks, including, among others risks of nonpayment of principal
and interest; collateral impairment; non-diversification and borrower industry
concentration; and lack of full liquidity.
* The Bloomberg Barclays U.S. High Yield 2% Issuer Capped Index is a component
of the U.S. Corporate High-Yield Bond Index, which covers the universe of
fixed-rate, non-investment grade corporate debt of issuers in non-emerging
market countries. It is not market capitalization-weighted and each issuer is
capped at 2% of the index. The S&P/LSTA Leveraged Loan Index (LLI) reflects
the market-weighted performance of U.S. dollar-denominated institutional
leveraged loan portfolios. The LLI is the only domestic leveraged loan index
that utilizes real-time market weightings spreads and interest payments. The
ICE BofAML US Dollar 3-Month Deposit Offered Rate Constant Maturity (USD 3-Mo
Dep OR CM) Index tracks the performance of a synthetic asset paying LIBOR to
a stated maturity. Indices are not managed and an investor cannot invest
directly into an index.
**Carry involves borrowing at a low interest rate and investing in an asset
that provides a higher rate of return.
Securities listed may or may not be a part of current Fund construction.
93
SunAmerica Income Funds
COMPARISONS: PORTFOLIOS vs. INDICES -- (unaudited) (continued)
Over the past ten years, $10,000 invested in AIG Flexible Credit Fund Class A
shares would have increased to $22,748. The same amount invested in securities
mirroring the performance of the Blended Benchmark (50% Bloomberg Barclays U.S.
High-Yield 2% Issuer Capped Index/50% S&P/LSTA Leveraged Loan Index), the
Bloomberg Barclays U.S. High-Yield 2% Issuer Capped Index, the S&P/LSTA
Leveraged Loan Index and the ICE BofAML USD 3-Mo Dep OR CM Index would be
valued at $25,016, $28,935, $21,546, and $10,728, respectively.
[CHART]
Blended Benchmark
(50% Bloomberg
Barclays U.S.
High-Yield 2% S&P/LSTA
Issuer Capped Bloomberg Leveraged
Index/50% Barclays U.S. Loan
AIG Flexible S&P/LSTA High-Yield 2% Index ICE BofAML USD
Credit Fund Leveraged Issuer /DAGGER/ 3-Mo Dep OR
Date Class A/#/ Loan Index) Capped Index@ /DAGGER/ CM Index***
---------- ------------ ------------------ ------------- ---------- --------------
3/31/2009 $ 9,509 $10,000 $10,000 $10,000 $10,000
4/30/2009 10,389 11,025 11,180 10,870 10,014
5/31/2009 11,094 11,731 11,929 11,533 10,030
6/30/2009 11,381 12,160 12,280 12,038 10,036
7/31/2009 12,061 12,813 13,017 12,609 10,044
8/31/2009 12,123 13,081 13,267 12,894 10,051
9/30/2009 12,694 13,664 14,025 13,306 10,055
10/31/2009 12,952 13,825 14,279 13,380 10,057
11/30/2009 13,087 13,911 14,419 13,415 10,060
12/31/2009 13,499 14,344 14,892 13,809 10,062
1/31/2010 13,637 14,584 15,087 14,091 10,065
2/28/2010 13,683 14,614 15,106 14,131 10,067
3/31/2010 14,115 15,000 15,564 14,449 10,068
4/30/2010 14,463 15,289 15,935 14,662 10,069
5/31/2010 13,839 14,843 15,364 14,332 10,068
6/30/2010 13,975 14,900 15,554 14,265 10,073
7/31/2010 14,460 15,277 16,101 14,484 10,079
8/31/2010 14,473 15,305 16,106 14,533 10,086
9/30/2010 14,917 15,639 16,583 14,737 10,089
10/31/2010 15,232 15,961 17,006 14,968 10,091
11/30/2010 15,057 15,898 16,812 15,021 10,094
12/31/2010 15,343 16,141 17,116 15,207 10,096
1/31/2011 15,658 16,478 17,494 15,507 10,099
2/28/2011 15,874 16,625 17,725 15,579 10,101
3/31/2011 15,962 16,651 17,782 15,577 10,104
4/30/2011 16,139 16,832 18,057 15,676 10,107
5/31/2011 16,229 16,866 18,146 15,662 10,110
6/30/2011 16,037 16,753 17,969 15,604 10,112
7/31/2011 16,218 16,862 18,177 15,627 10,114
8/31/2011 15,419 16,152 17,446 14,938 10,115
9/30/2011 15,033 15,921 16,872 15,002 10,116
10/31/2011 15,777 16,628 17,885 15,436 10,119
11/30/2011 15,524 16,408 17,499 15,360 10,120
12/31/2011 15,912 16,669 17,965 15,439 10,124
1/31/2012 16,331 17,104 18,510 15,776 10,130
2/29/2012 16,650 17,373 18,951 15,897 10,135
3/31/2012 16,635 17,428 18,926 16,019 10,140
4/30/2012 16,813 17,582 19,121 16,138 10,144
5/31/2012 16,600 17,406 18,866 16,029 10,148
6/30/2012 16,925 17,650 19,265 16,139 10,152
7/31/2012 17,206 17,920 19,631 16,326 10,156
8/31/2012 17,338 18,125 19,861 16,510 10,161
9/30/2012 17,570 18,352 20,137 16,693 10,165
10/31/2012 17,605 18,462 20,314 16,746 10,169
11/30/2012 17,788 18,564 20,477 16,798 10,172
12/31/2012 18,030 18,783 20,799 16,930 10,175
1/31/2013 18,218 19,009 21,078 17,110 10,178
2/28/2013 18,243 19,077 21,185 17,146 10,180
3/31/2013 18,535 19,253 21,401 17,287 10,183
4/30/2013 18,773 19,485 21,788 17,390 10,186
5/31/2013 18,599 19,447 21,662 17,423 10,188
6/30/2013 18,155 19,134 21,094 17,320 10,190
7/31/2013 18,499 19,410 21,493 17,491 10,193
8/31/2013 18,315 19,347 21,363 17,484 10,195
9/30/2013 18,499 19,467 21,575 17,527 10,198
10/31/2013 18,900 19,781 22,114 17,655 10,200
11/30/2013 18,926 19,880 22,226 17,742 10,202
12/31/2013 19,007 19,980 22,346 17,825 10,204
1/31/2014 19,143 20,116 22,503 17,942 10,206
2/28/2014 19,545 20,336 22,957 17,973 10,208
3/31/2014 19,573 20,397 23,012 18,038 10,210
4/30/2014 19,707 20,473 23,157 18,058 10,213
5/31/2014 19,843 20,638 23,369 18,183 10,214
6/30/2014 20,031 20,784 23,565 18,288 10,216
7/31/2014 19,671 20,643 23,252 18,283 10,218
8/31/2014 19,975 20,823 23,622 18,311 10,220
9/30/2014 19,550 20,542 23,126 18,202 10,222
10/31/2014 19,852 20,691 23,401 18,249 10,224
11/30/2014 19,699 20,667 23,231 18,339 10,226
12/31/2014 19,416 20,388 22,896 18,109 10,228
1/31/2015 19,482 20,489 23,046 18,169 10,230
2/28/2015 19,884 20,880 23,602 18,426 10,232
3/31/2015 19,838 20,862 23,473 18,494 10,234
4/30/2015 20,017 21,084 23,757 18,664 10,236
5/31/2015 20,026 21,136 23,828 18,699 10,239
6/30/2015 19,918 20,935 23,474 18,621 10,241
7/31/2015 19,927 20,873 23,338 18,620 10,243
8/31/2015 19,703 20,618 22,929 18,490 10,245
9/30/2015 19,418 20,286 22,340 18,370 10,248
10/31/2015 19,661 20,545 22,953 18,336 10,251
11/30/2015 19,492 20,228 22,446 18,175 10,252
12/31/2015 19,229 19,868 21,881 17,985 10,252
1/31/2016 19,118 19,643 21,529 17,867 10,257
2/29/2016 19,177 19,647 21,652 17,773 10,262
3/31/2016 19,597 20,355 22,614 18,263 10,268
4/30/2016 20,015 20,955 23,500 18,625 10,273
5/31/2016 20,082 21,113 23,645 18,791 10,277
6/30/2016 20,147 21,213 23,863 18,795 10,284
7/31/2016 20,459 21,651 24,508 19,064 10,287
8/31/2016 20,711 21,959 25,020 19,207 10,292
9/30/2016 20,782 22,127 25,187 19,373 10,299
10/31/2016 20,857 22,261 25,284 19,533 10,306
11/30/2016 20,745 22,238 25,164 19,585 10,313
12/31/2016 21,030 22,571 25,629 19,811 10,320
1/31/2017 21,231 22,798 26,001 19,922 10,328
2/28/2017 21,426 23,021 26,379 20,022 10,335
3/31/2017 21,382 23,005 26,320 20,038 10,343
4/30/2017 21,585 23,188 26,624 20,126 10,353
5/31/2017 21,667 23,331 26,854 20,199 10,362
6/30/2017 21,619 23,342 26,891 20,191 10,371
7/31/2017 21,824 23,551 27,189 20,330 10,382
8/31/2017 21,781 23,541 27,178 20,321 10,394
9/30/2017 21,925 23,693 27,422 20,400 10,405
10/31/2017 22,010 23,814 27,539 20,522 10,416
11/30/2017 21,964 23,798 27,469 20,546 10,425
12/31/2017 22,061 23,881 27,552 20,627 10,434
1/31/2018 22,347 24,067 27,717 20,826 10,448
2/28/2018 22,239 23,989 27,481 20,867 10,457
3/31/2018 22,139 23,950 27,315 20,926 10,468
4/30/2018 22,231 24,078 27,493 21,012 10,487
5/31/2018 22,261 24,095 27,485 21,048 10,510
6/30/2018 22,222 24,157 27,596 21,072 10,530
7/31/2018 22,448 24,378 27,897 21,228 10,550
8/31/2018 22,546 24,517 28,103 21,313 10,572
9/30/2018 22,639 24,669 28,259 21,460 10,591
10/31/2018 22,469 24,468 27,807 21,453 10,609
11/30/2018 22,161 24,253 27,568 21,259 10,627
12/31/2018 21,563 23,684 26,977 20,718 10,651
1/31/2019 22,274 24,521 28,197 21,246 10,678
2/28/2019 22,641 24,920 28,666 21,584 10,703
3/31/2019 22,748 25,016 28,935 21,546 10,728
AIG Flexible Credit Fund
Class A## Class C Class W
----------------- ------------------ ------------------ ------------------
Average Average Average
Annual Cumulative Annual Cumulative Annual Cumulative
Return Return+ Return Return+ Return Return+
----------------- ------- ---------- ------- ---------- ------- ----------
1 Year Return -2.14% 2.75% 1.11% 2.09% 3.26% 3.26%
--------------------------------------------------------------------------
5 Year Return 2.05% 16.22% 2.39% 12.56% N/A N/A
--------------------------------------------------------------------------
10 Year Return 8.57% 139.22% 8.39% 123.80% N/A N/A
--------------------------------------------------------------------------
Since Inception* 4.66% 166.11% 4.42% 123.59% 3.71% 17.78%
--------------------------------------------------------------------------
+ Cumulative returns do not include sales load. If sales load had been
included, the return would be lower.
* Inception Date - Class A: 11/2/98; Class C: 08/21/00; Class W: 10/01/14.
# For the purposes of the graph, it has been assumed that the maximum sales
charge of 4.75% of offering price was deducted from the initial $10,000
investment in the Fund. For purposes of the table, it has been assumed that
the maximum sales charge with respect to the Class A shares, was deducted
from the initial investment in the Fund and that the CDSCs with respect to
the Class C shares has been deducted, as applicable.
## As of the close of business on December 2, 2014, Class B shares of the Fund
were no longer offered to new or existing shareholders, except that
dividends and/or capital gain distributions received by a shareholder from
the Fund continued to be automatically reinvested in additional Class B
shares of the Fund, at the net asset value per share in effect on the
payable date, unless the shareholder had elected to receive them in cash or
automatically reinvest them in any retail fund distributed by AIG Capital
Services, Inc. As of the close of business on January 27, 2015, all
outstanding Class B shares of the Funds were converted to Class A shares.
For the 12 month period ended March 31, 2019, the AIG Flexible Credit Fund
Class A returned -2.14%, compared to 4.45% for the Blended Benchmark (50%
Bloomberg Barclays U.S. High-Yield 2% Issuer Capped Index/50% S&P/LSTA
Leveraged Loan Index), 5.93% for the Bloomberg Barclays U.S. High-Yield 2%
Issuer Capped Index, 2.97% for the S&P/LSTA Leveraged Loan Index and 2.48% for
the ICE BofAML USD 3-Mo Dep OR CM Index. (The performance data and graph do not
reflect the deduction of taxes that a shareholder would pay on Fund
distributions or the redemption of Fund shares.)
--------
Performance data quoted represents past performance and is no guarantee of
future results. Maximum Sales Charge: Class A: 4.75%, Class C: 1.00% CDSC. The
fund's daily net asset values are not guaranteed and shares are not insured by
the FDIC, the Federal Reserve Board or any other agency. The investment return
and principal value of an investment will fluctuate so that an investor's
shares, when redeemed, may be higher or lower than the original cost. Current
performance may be higher or lower than that shown. Performance as of the most
recent month end is available at www.aig.com/funds.
@ The Bloomberg Barclays U.S. High-Yield 2% Issuer Capped Index is a component
of the U.S. Corporate High Yield Bond Index, which covers the universe of
fixed-rate, non-investment grade corporate debt of issuers in non-emerging
market countries. It is not market capitalization-weighted and each issuer
is capped at 2% of the index.
++ The S&P/LSTA Leveraged Loan Index (LLI) reflects the market-weighted
performance of U.S. dollar-denominated institutional leveraged loan
portfolios. The LLI is the only domestic leveraged loan index that utilizes
real-time market weightings spreads and interest payments.
*** The ICE BofAML US Dollar 3-Month Deposit Offered Rate Constant Maturity
(USD 3-Mo Dep OR CM) Index tracks the performance of a synthetic asset
paying LIBOR to a stated maturity.
Indices are not managed and an investor cannot invest directly into an index.
94
SunAmerica Income Funds
SUPPLEMENT TO THE PROSPECTUS
THIS SUPPLEMENT IS NOT PART OF THE ANNUAL REPORT
SunAmerica Income Funds
AIG Flexible Credit Fund
AIG Strategic Bond Fund
AIG U.S. Government Securities Fund
(each, a "Fund")
Supplement dated April 1, 2019
to each Fund's Summary Prospectus and Prospectus, as supplemented and amended
to date
Effective immediately, in the section of each Summary Prospectus entitled "Fees
and Expenses of the Fund," the first sentence of footnote 1 to the table is
deleted in its entirety and replaced with the following:
Purchases of Class A shares of $1 million or more will be subject to a
contingent deferred sales charge ("CDSC") on redemptions made within one
year of purchase.
In the section of the Prospectus entitled "Shareholder Account Information --
Calculation of Sales Charges," the paragraph under the heading "Investments of
$1 million or more" is deleted in its entirety and replaced with the following:
Investments of $1 million or more: Class A shares are offered with no
front-end sales charge with respect to investments of $1 million or more.
However, a 1% CDSC is imposed on any shares you sell within one year of
purchase.
PLEASE RETAIN THIS SUPPLEMENT FOR FUTURE REFERENCE.
95
[LOGO]
AIG Funds
Harborside 5
185 Hudson Street, Suite 3300
Jersey City, NJ 07311
Trustees VOTING PROXIES ON DISCLOSURE OF
Richard W. Grant TRUST PORTFOLIO QUARTERLY PORTFOLIO
Peter A. Harbeck SECURITIES HOLDINGS
Dr. Judith L. Craven A description of the The Trust is required
William F. Devin policies and to file its complete
Stephen J. Gutman proce-dures that the schedule of portfolio
Eileen A. Kamerick Trust uses to holdings quarterly
Officers determine how to vote with the U.S.
John T. Genoy, President proxies relating to Securities and
James Nichols, Vice secu-rities held in a Exchange Commission on
President Fund's portfolio, Form N-PORT. The
Christopher C. Joe, which is available in Trusts' Forms N-PORT
Chief Compliance the Trust's Statement are available on the
Officer of Additional U.S. Securities and
Gregory N. Bressler, Information, may be Exchange Commission's
Secretary ob-tained without website at
Kathleen Fuentes, Chief charge upon request, http://www.sec.gov.
Legal Officer and by calling (800) PROXY VOTING RECORD ON
Assistant Secretary 858-8850. The SUNAMERICA INCOME FUNDS
Gregory R. Kingston, in-formation is also Information regarding
Treasurer available from the how the Funds voted
Donna McManus, Vice EDGAR database on the proxies relating to
President and U.S. Secu-rities and securities held in the
Assistant Treasurer Exchange Commission's Funds during the most
Shawn Parry, Vice website at recent twelve month
President and http://www.sec.gov. period ended June 30
Assistant Treasurer DELIVERY OF is available, once
Matthew J. Hackethal, SHAREHOLDER DOCUMENTS filed with the U.S.
Anti-Money Laundering The Funds have adopted Securities and
Compliance Officer a policy that allows Exchange Commission,
Investment Adviser them to send only one without charge, upon
SunAmerica Asset copy of a Fund's request, by calling
Management, LLC prospectus, proxy (800) 858-8850 or on
Harborside 5 material, annual the U.S. Securities
185 Hudson Street, Suite report and semi-annual and Exchange
3300 report (the Commission's website
Jersey City, NJ 07311 "shareholder at http://www.sec.gov.
Distributor documents") to This report is
AIG Capital Services, shareholders with submitted solely for
Inc. multiple accounts the general
Harborside 5 residing at the same information of
185 Hudson Street, Suite "household." This shareholders of the
3300 practice is called Funds. Distribution of
Jersey City, NJ 07311 householding and this report to persons
Shareholder Servicing reduces Fund expenses, other than
Agent which benefits you and shareholders of the
AIG Fund Services, Inc. other shareholders. Funds is authorized
Harborside 5 Unless the Funds only in con-nection
185 Hudson Street, Suite receive instructions with a currently
3300 to the con-trary, you effective pro-spectus,
Jersey City, NJ 07311 will only receive one setting forth details
Custodian copy of the of the Funds, which
State Street Bank and shareholder documents. must precede or
Trust Company The Funds will accom-pany this report.
One Lincoln Street continue to household
Boston, MA 02111 the share-holder
Transfer Agent documents
DST Asset Manager indefinitely, until we
Solutions, Inc. are instructed
303 W 11th Street otherwise. If you do
Kansas City, MO 64105 not wish to
participate in
householding please
contact Shareholder
Services at (800)
858-8850 ext. 6010 or
send a written request
with your name, the
name of your fund(s)
and your account
number(s) to AIG Funds
c/o DST, P.O. Box
219186, Kansas City
MO, 64121-9186. We
will resume
in-dividual mailings
for your account
within thirty (30)
days of receipt of
your request.
Go Paperless!!
Did you know that you have the option to
receive your shareholder reports online?
By choosing this convenient service, you will no longer receive paper copies of
Fund documents such as annual reports, semi-annual reports, prospectuses and
proxy statements in the mail. Instead, you are provided with quick and easy
access to this information via the Internet.
Why Choose Electronic Delivery?
It's Quick -- Fund documents will be received faster than via traditional mail.
It's Convenient -- Elimination of bulky documents from personal files.
It's Cost Effective -- Reduction of your Fund's printing and mailing costs.
To sign up for electronic delivery, follow
these simple steps:
1 Go to www.aig.com/funds
2 Click on the link to "Go Paperless!!"
The email address you provide will be kept strictly confidential. Once your
enrollment has been processed, you will begin receiving email notifications
when anything you receive electronically is available online.
You can return to www.aig.com/funds at any time to change your email
address, edit your preferences or to cancel this service if you choose to
resume physical delivery of your Fund documents.
Please note - this option is only available to accounts opened through the
Funds.
For information on receiving this report online, see inside back cover.
AIG Funds are advised by SunAmerica Asset Management, LLC (SAAMCo) and
distributed by AIG Capital Services, Inc. (ACS), Member FINRA. Harborside 5,
185 Hudson Street, Suite 3300, Jersey City, NJ 07311, 800-858-8850. SAAMCo and
ACS are members of American International Group, Inc. (AIG).
This fund report must be preceded by or accompanied by a prospectus.
Investors should carefully consider a Fund's investment objectives, risks,
charges and expenses before investing. The prospectus, containing this and
other important information, can be obtained from your financial adviser, the
AIG Funds Sales Desk at 800-858-8850, ext. 6003, or at aig.com/funds. Read the
prospectus carefully before investing.
aig.com/funds
INANN - 3/19
[LOGO]
Item 2. Code of Ethics.
The SunAmerica Income Funds (the "registrant") has adopted a Code of
Ethics applicable to its Principal Executive and Principal Accounting
Officers pursuant to Section 406 of the Sarbanes-Oxley Act of 2002
(the "Code"). During the fiscal year ended March 31, 2019, there were
no reportable waivers or implicit waivers to a provision of the Code
that applies to the registrant's Principal Executive and Principal
Accounting Officers (the "Covered Officers").
Item 3. Audit Committee Financial Expert.
The registrant's Board of Trustees has determined that Eileen A.
Kamerick, a Trustee of the registrant, qualifies as an audit committee
financial expert, as defined in Item 3(b) of Form N-CSR. Ms. Kamerick
is considered to be "independent" for purposes of Item 3(a)(2) of Form
N-CSR.
Item 4. Principal Accountant Fees and Services.
(a)--(d) Aggregate fees billed to the registrant for the last two
fiscal years for professional services rendered by the registrant's
principal accountant were as follows:
2018 2019
(a) Audit Fees ....................$ 158,770 $ 163,528
(b) Audit-Related Fees ............$ 0 $ 0
(c) Tax Fees ......................$ 51,806 $ 53,308
(d) All Other Fees ................$ 0 $ 0
Audit Fees include amounts related to the audit of the registrant's
annual financial statements and services normally provided by the
principal accountant in connection with statutory and regulatory
filings. Tax Fees principally include tax compliance, tax advice, tax
planning and preparation of tax returns.
Aggregate fees billed to the investment adviser and Adviser Affiliates
(as defined below in Item 4(e)) that are required to be pre-approved
pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X for
the last two fiscal years for services rendered by the registrant's
principal accountant were as follows:
2018 2019
(b) Audit-Related Fees ............$ 0 $ 0
(c) Tax Fees ......................$ 0 $ 0
(d) All Other Fees ................$ 0 $ 36,429
(e) (1) The registrant's audit committee pre-approves all audit services
provided by the registrant's principal accountant for the registrant
and all non-audit services provided by the registrant's principal
accountant for the registrant, its investment adviser and any entity
controlling, controlled by, or under common control with the
investment adviser ("Adviser Affiliates") that provides ongoing
services to the registrant, if the engagement by the investment
adviser or Adviser Affiliates relates directly to the operations and
financial reporting of the registrant. The audit committee has not
presently established any pre-approval policies and procedures that
permit the pre-approval of the above services other than by the full
audit committee. Certain de minimis exceptions are allowed for non-
audit services in accordance with Rule 2-01(c)(7)(i)(C) of Regulation
S-X as set forth in the registrant's audit committee charter.
(2) No services included in (b)-(d) above in connection with fees
billed to the registrant or the investment adviser or Adviser
Affiliates were approved pursuant to paragraph (c)(7)(i)(C) of Rule 2-
01 of Regulation S-X.
(f) Not applicable.
(g) The aggregate fees billed for the most recent fiscal year and the
preceding fiscal year by the registrant's principal accountant for
non-audit services rendered to the registrant, its investment adviser,
and Adviser Affiliates that provides ongoing services to the registrant
for 2018 and 2019 were $51,806 and $158,308 respectively.
(h) Non-audit services rendered to the registrant's investment adviser and
any Adviser Affiliates that provides ongoing services to the registrant
that were not pre-approved pursuant to paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X were considered by the registrant's audit
committee as to whether they were compatible with maintaining the
principal accountant's independence.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Investments.
Included in Item 1 to the Form.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There were no material changes to the procedures by which shareholders
may recommend nominees to the registrant's Board of Trustees that were
implemented after the registrant last provided disclosure in response
to the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR
229.407) (as required by 22(b)(15)) of Schedule 14A (17 CFR 240.14a-
101), or this Item 10.
Item 11. Controls and Procedures.
(a) An evaluation was performed within 90 days of the filing of this
report, under the supervision and with the participation of the
registrant's management, including the President and Treasurer, of the
effectiveness of the design and operation of the registrant's
disclosure controls and procedures (as defined in Rule 30a-3(c)
under the Investment Company Act of 1940 (17 CFR 270.30a-3(c))). Based
on that evaluation, the registrant's management, including the
President and Treasurer, concluded that the registrant's disclosure
controls and procedures are effective.
(b) There was no change in the registrant's internal control over financial
reporting (as defined in Rule 30a-3(d) under the Investment Company Act
of 1940 (17 CFR 270.30a-3(d))) that occurred during the registrant's
last fiscal quarter of the period covered by this report that has
materially affected, or is reasonably likely to materially affect, the
registrant's internal contro1 over financial reporting.
Item 12. Disclosure of Securities Lending Activities for Closed-End Management
Investment Companies.
Not applicable.
Item 13. Exhibits.
(a) (1) Code of Ethics applicable to its Principal Executive and
Principle Accounting Officers pursuant to Section 406 of the
Sarbanes-Oxley Act of 2002 attached hereto as Exhibit 99.406.
Code of Ethics.
(2) Certifications pursuant to Rule 30a-2(a) under the Investment
Company Act of 1940 (17 CFR 270.30a-2(a)) attached hereto as Exhibit
99.CERT.
(3) Not applicable.
(b) Certification pursuant to Rule 30a-2(b) under the Investment Company
Act of 1940 (17 CFR 270.30a-2(a)) and Section 906 of the Sarbanes-
Oxley Act of 2002 attached hereto as Exhibit 99.906.CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
SunAmerica Income Funds
By: /s/ John T. Genoy
-----------------------
John T. Genoy
President
Date: June 07, 2019
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/ John T. Genoy
-----------------------
John T. Genoy
President
Date: June 07, 2019
By: /s/ Gregory R. Kingston
-----------------------
Gregory R. Kingston
Treasurer
Date: June 07, 2019
Exhibit 99.406
ANCHOR SERIES TRUST
SUNAMERICA EQUITY FUNDS
SUNAMERICA INCOME FUNDS
SUNAMERICA MONEY MARKET FUNDS, INC.
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
SUNAMERICA SERIES, INC.
SUNAMERICA SPECIALTY SERIES
(collectively, the "Funds")
CODE OF ETHICS FOR PRINCIPAL EXECUTIVE
AND PRINCIPAL ACCOUNTING OFFICERS
I. Introduction
The Boards of Directors/Trustees of the Funds (the "Boards") have adopted
this Code of Ethics (this "Code") pursuant to Section 406 of the Sarbanes-Oxley
Act applicable to the Funds' Principal Executive Officer and Principal
Accounting Officer (the "Covered Officers" each of whom is set forth in
Exhibit A) for the purpose of deterring wrongdoing and promoting:
. Honest and ethical conduct, including the ethical handling of conflicts of
interest between personal and professional relationships;
. Full, fair, accurate, timely and understandable disclosure;
. Compliance with applicable laws and governmental rules and regulations;
. The prompt internal reporting of violations of the Code to an appropriate
person or persons identified in the Code; and
. Accountability for adherence to the Code.
Each Covered Officer must comply with applicable law. Each Covered Officer
also has a responsibility to conduct himself or herself in an honest and
ethical manner and to adhere to a high standard of business ethics. Each
Covered Officer has leadership responsibilities that include promoting a
culture of high ethical standards and a commitment to compliance, maintaining a
work environment that encourages the internal reporting of compliance concerns
and promptly addressing compliance concerns. Each Covered Officer should also
be sensitive to situations that may give rise to conflicts of interest.
II.Honest and Ethical Conduct
a. Honesty, Diligence and Professional Responsibility
Covered Officers are expected to observe both the form and the spirit of the
ethical principles contained in this Code. In particular, Covered Officers must
perform their duties and responsibilities for the Funds:
. with honesty, diligence, and a commitment to professional and ethical
responsibility;
. carefully, thoroughly and in a timely manner; and
. in conformity with applicable professional and technical standards.
b. Ethical Handling of Actual and Apparent Conflicts of Interest
A "conflict of interest" occurs when a Covered Officer's private interest
improperly interferes with the interests of, or his or her service to, the
Funds. For example, a conflict of interest would arise if a Covered Officer, or
a member of his or her immediate family, receives improper personal benefits as
a result of his or her position with the Funds.
Certain conflicts of interest arise out of the relationships between Covered
Officers and the Funds and already are subject to conflict of interest
provisions in the Investment Company Act of 1940, as amended (the "Investment
Company Act") and the Investment Advisers Act of 1940, as amended (the
"Investment Advisers Act"). For example, Covered Officers may not individually
engage in certain transactions (such as the purchase or sale of securities or
other property) with the Funds because of their status as "affiliated persons"
of the Funds. The compliance programs and procedures of the Funds and the
Funds' investment adviser, SunAmerica Asset Management, LLC. ("SAAMCo"), are
designed to prevent, or identify and correct, violations of these provisions.
This Code does not, and is not intended to, repeat or replace these programs
and procedures, and such conflicts fall outside of the parameters of this Code.
Although typically not presenting an opportunity for improper personal
benefit, conflicts may arise from, or as a result of, the contractual
relationship between, the Funds and SAAMCo, of which the Covered Officers are
also officers or employees. As a result, this Code recognizes that the Covered
Officers will, in the normal course of their duties (whether formally for the
Funds or for SAAMCo, or for both), be involved in establishing policies and
implementing decisions that will have different effects on the Funds and
SAAMCo. The participation of the Covered Officers in such activities is
inherent in the contractual relationship between the Funds and SAAMCo and is
consistent with the performance by the Covered Officers of their duties as
officers of the Funds. Thus, if performed in conformity with the provisions of
the Investment Company Act and the Investment Advisers Act, such activities
will be deemed to have been handled ethically.
2
In addition, it is recognized by the Boards that the Covered Officers may also
be officers or employees of other investment companies advised by SAAMCo.
In particular, each Covered Officer must:
. Not use his or her personal influence or personal relationships to influence
investment decisions or financial reporting by the Funds whereby the Covered
Officer would benefit personally to the detriment of the Funds;
. Not cause the Funds to take action, or fail to take action, for the
individual personal benefit of the Covered Officer rather than the benefit
of the Funds; and
. Report at least annually to the Funds' Ethics Committee any material
transaction or relationship that could reasonably be expected to give rise
to a conflict of interest.
There are certain potential conflict of interest situations that should be
discussed with the Ethics Committee if material. Examples of these include:
. Service as a director on the board of any company;
. The receipt of any non-nominal gifts;
. The receipt of any entertainment from any company with which the Funds have
current or prospective business dealings unless such entertainment is
business-related, reasonable in cost, appropriate as to time and place, and
not so frequent as to raise any question of impropriety;
. Any ownership interest in, or any consulting or employment relationship
with, any of the Funds' service providers, other than SAAMCo, the Funds'
principal underwriter or any affiliated person thereof;
. A direct or indirect financial interest in commissions, transaction charges
or spreads paid by the Funds for effecting portfolio transactions or for
selling or redeeming shares other than an interest arising from the Covered
Officer's employment, such as compensation or equity ownership.
c. Conduct in the Preparation of Financial Statements
Covered Officers must not knowingly make any misrepresentations regarding
the Funds' financial statements or any facts used in the preparation of the
Funds' financial statements. This section is intended to prohibit:
. making, or permitting or directing another to make, materially false or
misleading entries in the Funds' financial statements or records;
3
. failing to correct the Funds' financial statements or records that are
materially false or misleading; and
. signing, or permitting or directing another to sign, a document containing
materially false or misleading financial information.
d. Obligations to the Independent Auditor of the Funds
In dealing with the Funds' independent auditor, Covered Officers must be
candid and not knowingly misrepresent facts or knowingly fail to disclose
material facts, and must respond to specific inquiries and requests by the
Funds' independent auditor.
Covered Officers must not take any action, or direct any person to take any
action, to fraudulently influence, coerce, manipulate or mislead the Funds'
independent auditor in the performance of an audit of the Funds' financial
statements for the purpose of rendering such financial statements materially
misleading.
III.Disclosure and Compliance
. Each Covered Officer will familiarize himself or herself with the disclosure
requirements generally applicable to the Funds;
. Each Covered Officer will not knowingly misrepresent, or cause others to
misrepresent, facts about the Funds to others, whether within or outside the
Funds, including to the Boards and auditors, or to governmental regulators
and self-regulatory organizations;
. Each Covered Officer will, to the extent appropriate within his or her area
of responsibility, consult with other officers and employees of the Funds
and SAAMCo with the goal of promoting full, fair, accurate, timely and
understandable disclosure in the reports and documents that the Funds file
with, or submit to, the SEC and in other public communications made by the
Funds; and
. It is the responsibility of each Covered Officer to promote compliance with
the standards and restrictions imposed by applicable laws, rules and
regulations.
IV.Reporting and Accountability
Each Covered Officer must:
. Upon adoption of the Code (or thereafter as applicable, upon becoming a
Covered Officer), affirm in writing to the Boards that he or she has
received, read and understands the Code;
. Annually thereafter affirm to the Boards that he or she has complied with
the requirements of the Code;
4
. Not retaliate against any other Covered Officer or affiliated person of the
Funds for reports of potential violations of this Code that are made in good
faith; and
. Notify the Ethics Committee promptly if he or she knows of any violation of
this Code. Failure to do so is itself a violation of this Code.
The Ethics Committee is responsible for applying this Code to specific
situations in which questions are presented to it and has the authority to
interpret this Code in any particular situation. The Ethics Committee will also
consider waivers sought by the Covered Officers.
The Funds will act according to the following procedures in investigating
and enforcing this Code:
. The Ethics Committee will take all appropriate action to investigate any
potential violations reported to it;
. If, after such investigation, the Ethics Committee believes that no
violation has occurred, the Ethics Committee is not required to take any
further action;
. If the Ethics Committee determines that a violation has occurred, it will
consider appropriate action, which may include review of, and appropriate
modifications to, applicable policies and procedures; notification to
appropriate personnel of SAAMCo or its board; or a recommendation to dismiss
the Covered Officer;
. The Ethics Committee will be responsible for granting waivers, as
appropriate;
. The Ethics Committee will inform the Boards of violations or waivers of this
Code; and
. Any changes to or waivers of this Code will, to the extent required, be
disclosed as provided by SEC rules.
V. Other Policies and Procedures
This Code shall be the sole Code of Ethics adopted by the Funds for purposes
of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to
investment companies thereunder. Insofar as other policies or procedures of the
Funds, SAAMCo, the Funds' principal underwriter or other service providers
govern or purport to govern the behavior or activities of the Covered Officers
who are subject to this Code, they are superseded by this Code to the extent
that they overlap or conflict with the provisions of this Code. The Code of
Ethics of the Funds, SAAMCo and the Funds' principal underwriter, under Rule
17j-1 of the Investment Company Act, and SAAMCo's more detailed policies and
procedures set forth in the SAAMCo Compliance Procedures Manual are separate
requirements applying to Covered Officers and others, and are not part of this
Code.
5
VI.Amendments
Any amendments to this Code, other than amendments to Exhibit A, must be
approved or ratified by a majority vote of the Boards.
VII.Confidentiality
All reports and records prepared or maintained pursuant to this Code shall
be considered confidential and shall be maintained and protected accordingly.
Except as otherwise required by law or this Code, such matters shall not be
disclosed to anyone other than the Funds, the Ethics Committee, SAAMCo and the
Boards and their independent counsel.
VIII.Internal Use
The Code is intended solely for internal use by the Funds and does not
constitute an admission, by or on behalf of the Funds, as to any fact,
circumstance or legal conclusion.
Date: January 1, 2017
6
Exhibit A
John Genoy, as President of the Funds
Gregory R. Kingston, as Treasurer of the Funds
7
Exhibit 99.CERT
CERTIFICATION PURSUANT TO SECTION 302
OF THE SARBANES-OXLEY ACT
I, John T. Genoy, certify that:
1. I have reviewed this report on Form N-CSR of SunAmerica Income Funds;
2. Based on my knowledge, this report does not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were
made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations, changes in net assets, and cash
flows (if the financial statements are required to include a statement of cash
flows) of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Rule 30a-3(c) under the Investment Company Act of 1940) and internal control
over financial reporting (as defined in Rule 30a-3(d) under the Investment
Company Act of 1940) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such
internal control over financial reporting to be designed under our supervision,
to provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls and
procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of a date within 90 days prior to
the filing date of this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal control
over financial reporting that occurred during the registrant's most recent
fiscal quarter of the period covered by this report that has materially
affected, or is reasonably likely to materially affect, the registrant's
internal control over financial reporting; and
5. The registrant's other certifying officer and I have disclosed to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control over
financial reporting.
Date: June 06, 2019
/s/ John T. Genoy
-------------------
John T. Genoy
President
CERTIFICATION PURSUANT TO SECTION 302
OF THE SARBANES-OXLEY ACT
I, Gregory R. Kingston, certify that:
1. I have reviewed this report on Form N-CSR of SunAmerica Income Funds;
2. Based on my knowledge, this report does not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were
made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations, changes in net assets, and cash
flows (if the financial statements are required to include a statement of cash
flows) of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Rule 30a-3(c) under the Investment Company Act of 1940) and internal control
over financial reporting (as defined in Rule 30a-3(d) under the Investment
Company Act of 1940) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such
internal control over financial reporting to be designed under our supervision,
to provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls and
procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of a date within 90 days prior to
the filing date of this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal control
over financial reporting that occurred during the registrant's most recent
fiscal quarter of the period covered by this report that has materially
affected, or is reasonably likely to materially affect, the registrant's
internal control over financial reporting; and
5. The registrant's other certifying officer and I have disclosed to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control over
financial reporting.
Date: June 06, 2019
/s/ Gregory R. Kingston
-----------------------
Gregory R. Kingston
Treasurer
Exhibit 99.906.CERT
CERTIFICATIONS PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT
John T. Genoy, President, and Gregory R. Kingston, Treasurer of SunAmerica
Income Funds (the "registrant"), each certify to the best of his knowledge that:
1. The attached Form N-CSR report of the registrant fully complies with the
requirements of Sections 13(a) and 15(d) of the Securities Exchange Act of
1934; and
2. The information contained in such N-CSR report fairly represents, in all
material respects, the financial conditions and results of operations of
the registrant as of, and for, the periods presented in the report.
Dated: June 06, 2019
/s/ John T. Genoy
---------------
John T. Genoy
President
/s/ Gregory R. Kingston
-------------------
Gregory R. Kingston
Treasurer
