Contact Information: PIMCO: Mick Willemsen (949) 720-4734 www.pcmfund.com
PIMCO Commercial Mortgage Securities Trust, Inc.
Reissue From February 27, 2007
NEWPORT BEACH, CA -- (MARKET WIRE) -- March 2, 2007 -- PIMCO Commercial Mortgage Securities
Trust, Inc. (NYSE : PCM ) (the "Fund") announced today that the Fund's Board
of Directors approved changes to the Fund's name, certain non-fundamental
investment policies and its dividend policy, each as more fully described
below.
Name Change
The Board of Directors of the Fund has approved a change in the Fund's name
to PCM Fund, Inc. The change in the Fund's name is consistent with the
investment changes described below regarding minimum investment in
commercial mortgage-backed securities ("CMBS") and with Securities and
Exchange Commission rules governing the names of investment companies. This
change will be effective upon 60 days' notice to shareholders.
Investment Changes
The Board of Directors of the Fund also approved certain changes to the
Fund's investment policies, as more fully described below.
The Fund is eliminating its non-fundamental policy of investing at least
80% of its net assets and amounts borrowed for investment purposes in CMBS.
Instead, the Fund is adopting a non-fundamental policy requiring the Fund
to invest at least 65% of its total assets in CMBS. Reducing the required
investment in CMBS will expand the Fund's available universe of permitted
investments. This change will be effective upon 60 days' notice to
shareholders.
Also, the Fund is changing its investment policies to permit investment in
credit derivatives. This change will permit the use of credit derivatives,
such as credit default swaps, and other derivative instruments for gaining
synthetic exposures. This expands the Fund's available universe of
permitted investments within the corporate and asset backed securities
(ABS) sectors. This change is effective immediately.
Additionally, the Fund has changed its policies so that it will now be
permitted to use Fitch Ratings as a rating agency for purposes of credit
quality investment restrictions. The Fund currently uses Moody's and S&P
ratings, or, if an issue is unrated, PIMCO's assessment of the issue's
credit quality. PIMCO believes that this change will increase flexibility
in managing the Fund without adding significant risks. This change is also
effective immediately.
Dividend Change
The Board of Directors of the Fund also has changed the Fund's monthly per
share common dividend from 9.375 cents per common share to 7.00 cents per
common share, effective with the next dividend declaration. The decision to
reduce the Fund's dividend is due to certain factors including: the
dramatic increase in short-term interest rates and prolonged inversion of
the U.S. yield curve, which has increased borrowing costs for the Fund, and
the narrowing of risk premiums offered by the bond market which has led to
lower reinvestment yields.
The Fund is a closed-end investment company investing primarily in
commercial mortgage-backed securities. Pacific Investment Management
Company LLC ("PIMCO"), an investment adviser with approximately $667
billion of assets under management as of December 31, 2006, is responsible
for managing the Fund's investment portfolio.