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Putnam Mortgage Recovery Fund completes initial registration of shares
By Toni Weeks
San Diego, Jan. 5 - Putnam Mortgage Recovery Fund completed its initial registration of $300 million of shares in an N-2 filing with the Securities and Exchange Commission.
The newly formed fund, whose operations have not yet commenced, intends to maximize total return by investing primarily in mortgage-related fixed-income securities and related derivatives, with no constraints on credit ratings.
Shares will be offered at $10 each during the initial offering period and will be offered after that on a continuous basis at net asset value. The minimum initial investment requirement is $10 million unless waived by Putnam Investment Management, LLC, the fund's Boston-based investment adviser, and subsequent investments must be at least $10,000.
The fund will operate as an "interval fund" and will offer to repurchase a portion of its outstanding shares at net asset value every six months. If the fund obtains a net asset value of at least $250 million, it will make repurchase offers every three months. The fund will offer to repurchase 5% of its outstanding shares in each repurchase offer, unless its board of trustees approves a higher amount of up to 25% of outstanding shares.
The portfolio managers will be Michael Salm, Daniel Choquette and Brett Kozlowski.
The fund does not intend to list its shares for trading on any national securities exchange.
Total annual expenses for the fund will be 0.95%, which consists of a management fee paid to the adviser. The fund does not currently charge a repurchase fee but may charge a fee of up to 2% for future repurchases. There is no other sales charge.
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