Morgan Stanley Insured Municipal Trust Adopts Investment Policy Changes
December 12 2008 - 5:07PM
Business Wire
Morgan Stanley Insured Municipal Trust (NYSE: IMT) (the �Trust�)
has received shareholder approval to adopt the investment policy
change, as described below. This change is designed to expand the
investment universe in which the Trust can invest, thereby
providing the Trust�s portfolio management team with important
flexibility to respond to ongoing developments in the insured
municipal bond market. The Trust seeks to achieve its investment
objective by providing income which is exempt from federal income
tax. The Trust is not changing its investment objective. In
connection with the recent instability in the marketplace, some of
the insurers of municipal obligations have experienced ratings
downgrades by the ratings agencies that rate such insurers� claims
paying ability. This affects many funds that invest in insured
municipal obligations because many of these funds (including the
Trust) currently have policies that require such funds to invest 80
percent of their net assets in municipal obligations that are
insured by an insurer rated �AAA� at the time of purchase. At a
meeting held on December 12, 2008, the Trust�s shareholders have
approved the following investment policy change: To allow the Trust
to invest, under normal market conditions, at least 80 percent of
the Trust�s net assets in municipal obligations which are covered
by insurance guaranteeing the timely payment of principal and
interest thereon and that are rated at least �A� by a nationally
recognized statistical rating organization (�NRSRO�) or are unrated
but judged to be of similar credit quality by the Trust�s
Investment Adviser, or covered by insurance issued by insurers
rated at least �A� by a NRSRO. The Trust�s Management believes that
the changed policy allows the Trust to continue to purchase higher
quality insured municipal obligations, while acknowledging the
changing market and economic conditions. While the market risk and
the credit risk of the Trust investing in insured municipal
obligations generally should be lower than the risks of a fund
investing in similar municipal obligations that are uninsured,
insurance does not eliminate the market risk or credit risk of the
securities in the Trust�s portfolio. A downgrade of an insurer
would generally subject the Trust to potential market value
declines and increased credit risk on the municipal obligations
insured by such insurer. Morgan Stanley Investment Management,
together with its investment advisory affiliates, has nearly 1000
investment professionals around the world and approximately $570
billion in assets under management or supervision as of August 31,
2008. By leveraging�its global��community of boutiques� structure
and�the strength of Morgan Stanley, MSIM�strives to provide
outstanding long-term investment performance, service and a
comprehensive suite of investment management�solutions to a
diverse�client base, which includes governments, institutions,
corporations and individuals�worldwide. Morgan Stanley is a leading
global financial services firm providing a wide range of investment
banking, securities, investment management, wealth management and
credit services. The Firm's employees serve clients worldwide
including corporations, governments, institutions and individuals
from more than 600 offices in 35 countries. For further information
about Morgan Stanley, please visit www.morganstanley.com.
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