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 811-22773
BROOKFIELD MORTGAGE OPPORTUNITY INCOME FUND INC.
(Exact name of registrant as specified in charter)
BROOKFIELD PLACE
250 VESEY STREET
NEW YORK, NEW YORK 10281-1023
(Address of principal executive offices) (Zip code)
BRIAN F. HURLEY, PRESIDENT
BROOKFIELD MORTGAGE OPPORTUNITY INCOME FUND INC.
BROOKFIELD PLACE
250 VESEY STREET
NEW YORK, NEW YORK 10281-1023
(Name and address of agent for service)
Registrant’s telephone number, including area code: (855) 777-8001
Date of fiscal year end: June 30, 2016
Date of reporting period: June 30, 2016
Item 1. Reports to Shareholders.
Portfolio Characteristics (Unaudited)
PORTFOLIO STATISTICS | |
Annualized distribution rate1 | 10.26% |
Weighted average coupon | 2.88% |
Average portfolio dollar price (excluding interest-only securities) | $ 78.83 |
Percentage of fixed securities (excluding cash, equities and interest-only securities)2 | 51.90% |
Percentage of floating securities (excluding cash, equities and interest-only securities)2 | 48.10% |
Percentage of leveraged assets | 22.66% |
Total number of holdings | 140 |
ASSET BY COUPON TYPE DISTRIBUTION2 | |
Residential Mortgage Related Holdings - Fixed Rate | 11.6% |
Residential Mortgage Related Holdings - Floating Rate | 26.9% |
Subprime - Fixed Rate | 1.6% |
Subprime - Floating Rate | 18.9% |
Commercial Mortgage Related Holdings - Fixed Rate | 15.0% |
Commercial Mortgage Related Holdings - Floating Rate | 2.4% |
Corporate Bonds - Fixed Rate | 6.7% |
Loans - Fixed Rate | 1.4% |
Equities and Preferred Equity | 2.2% |
Cash and Other Financial Instruments | 13.3% |
Total | 100.0% |
ASSET ALLOCATION3 | |
Residential Mortgage Related Holdings | 79.4% |
Commercial Mortgage Related Holdings | 20.9% |
Interest-Only Securities | 0.6% |
Corporate Bonds | 8.4% |
Preferred Stocks and Common Stock | 2.7% |
Liabilities in Excess of Other Assets | (12.0)% |
Total | 100.0% |
Schedule of Investments
Interest Rate | Maturity | Principal Amount (000s) | Value | |||
RESIDENTIAL MORTGAGE RELATED HOLDINGS – 79.4% | ||||||
Non-Agency Mortgage-Backed Securities – 79.4% | ||||||
ACE Securities Corp. Home Equity Loan Trust | ||||||
Series 2006-OP1, Class A2D 1,2 | 0.69% | 04/25/36 | $ 6,740 | $ 4,606,340 | ||
Alternative Loan Trust | ||||||
Series 2007-OA3, Class 1A1 1,2,3 | 0.59 | 04/25/47 | 9,401 | 7,826,025 | ||
Series 2006-OA17, Class 1A1A 1,2,3 | 0.64 | 12/20/46 | 4,392 | 3,172,906 | ||
Series 2006-OA2, Class A1 1,2,3 | 0.66 | 05/20/46 | 4,578 | 2,871,216 | ||
Series 2007-2CB, Class 2A11 1 | 0.85 | 03/25/37 | 6,380 | 3,774,696 | ||
Series 2006-19CB, Class A9 1 | 1.15 | 08/25/36 | 5,151 | 3,152,328 | ||
Series 2005-50CB, Class 1A1 3 | 5.50 | 11/25/35 | 3,360 | 3,040,783 | ||
Series 2007-15CB, Class A5 | 5.75 | 07/25/37 | 2,044 | 1,674,521 | ||
Series 2007-15CB, Class A2 | 5.75 | 07/25/37 | 2,220 | 1,819,181 | ||
Series 2006-45T1, Class 2A5 3 | 6.00 | 02/25/37 | 4,712 | 3,602,842 | ||
Series 2006-29T1, Class 2A6 3 | 6.50 | 10/25/36 | 4,638 | 3,837,883 | ||
Series 2006-23CB, Class 2A7 1,4,7 (Acquired 05/31/13, Cost $3,421,155, 1.0%) | 26.59 | 08/25/36 | 2,205 | 3,661,290 | ||
Asset-Backed Securities Corporation Home Equity Loan Trust | ||||||
Series 2007-HE1, Class A4 1,2 | 0.59 | 12/25/36 | 4,832 | 3,891,342 | ||
Banc of America Funding Trust | ||||||
Series 2006-G, Class 3A2 1 | 3.07 | 07/20/36 | 6,699 | 6,528,998 | ||
BCAP LLC Trust | ||||||
Series 2010-RR6, Class 1910 1,2,5 | 0.77 | 11/26/35 | 8,440 | 5,852,304 | ||
Series 2010-RR5, Class 5A10 1,2,5 | 0.77 | 11/26/35 | 6,733 | 4,618,352 | ||
Series 2012-RR4, Class 5A6 5,7 (Acquired 09/18/14, Cost $2,655,873, 0.7%) | 2.67 | 05/26/36 | 3,784 | 2,575,227 | ||
Series 2013-RR2, Class 3A2 5,7 (Acquired 05/12/14, Cost $7,111,232, 1.8%) | 2.96 | 03/26/36 | 7,093 | 6,550,845 | ||
BXHTL Mortgage Trust | ||||||
Series 2015-JWRZ, Class DR2 1,5,7 (Acquired 06/19/15, Cost $3,640,380, 0.9%) | 4.13 | 05/15/29 | 3,750 | 3,449,082 | ||
Chase Mortgage Finance Trust | ||||||
Series 2005-A2, Class 3A2 1 | 2.63 | 01/25/36 | 3,424 | 3,116,829 | ||
CHL Mortgage Pass-Through Trust | ||||||
Series 2006-HYB5, Class 3A1B | 2.84 | 09/20/36 | 5,296 | 3,952,705 | ||
Series 2006-HYB5, Class 3A1A | 2.84 | 09/20/36 | 1,151 | 858,770 | ||
Citigroup Mortgage Loan Trust | ||||||
Series 2012-6, Class 2A2 5 | 2.73 | 08/25/36 | 8,698 | 7,364,305 | ||
Series 2007-AR5, Class 1A2A | 3.00 | 04/25/37 | 3,399 | 3,077,706 | ||
Series 2009-6, Class 19A2 5,7 (Acquired 06/05/13, Cost $2,676,926, 0.9%) | 6.00 | 03/25/36 | 4,419 | 3,355,846 | ||
Credit Suisse Mortgage Trust | ||||||
Series 2011-10R, Class 3A2 5 | 2.75 | 09/27/36 | 4,847 | 4,118,744 | ||
First Horizon Alternative Mortgage Securities Trust | ||||||
Series 2005-FA8, Class 1A6 1 | 1.10 | 11/25/35 | 3,446 | 2,276,013 | ||
Series 2005-FA9, Class A1 1,3 | 1.15 | 12/25/35 | 3,237 | 2,170,966 | ||
GMACM Home Equity Loan Trust | ||||||
Series 2007-HE2, Class A3 | 6.19 | 12/25/37 | 4,208 | 4,137,159 |
Schedule of Investments (continued)
Interest Rate | Maturity | Principal Amount (000s) | Value | |||
RESIDENTIAL MORTGAGE RELATED HOLDINGS (continued) | ||||||
GMACM Home Loan Trust | ||||||
Series 2006-HLTV, Class A5 2 | 6.01% | 10/25/29 | $ 3,434 | $ 3,504,975 | ||
Greenpoint Manufactured Housing | ||||||
Series 1999-1, Class A5 | 6.77 | 08/15/29 | 5,899 | 5,749,990 | ||
Series 1999-3, Class 1A7 | 7.27 | 06/15/29 | 4,226 | 4,178,647 | ||
GSAMP Trust | ||||||
Series 2006-NC2, Class A2C 1,2 | 0.60 | 06/25/36 | 859 | 503,130 | ||
Series 2006-HE8, Class A2C 1,2 | 0.62 | 01/25/37 | 8,849 | 7,174,616 | ||
Home Equity Asset Trust | ||||||
Series 2006-7, Class 2A3 1,2 | 0.60 | 01/25/37 | 9,771 | 6,835,393 | ||
Hyatt Hotel Portfolio Trust | ||||||
Series 2015-HYT, Class E 1,2,3,5 | 4.24 | 11/15/29 | 7,950 | 7,750,515 | ||
IndyMac INDA Mortgage Loan Trust | ||||||
Series 2007-AR1, Class 1A1 | 3.13 | 03/25/37 | 3,520 | 3,240,812 | ||
Series 2007-AR3, Class 1A1 1 | 3.37 | 07/25/37 | 5,129 | 4,533,425 | ||
IXIS Real Estate Capital Trust | ||||||
Series 2007-HE1, Class A1 1,2 | 0.51 | 05/25/37 | 3,202 | 1,124,541 | ||
Series 2007-HE1, Class A2 1,2 | 0.56 | 05/25/37 | 5,099 | 1,811,358 | ||
Series 2006-HE2, Class A3 1,2 | 0.61 | 08/25/36 | 7,916 | 3,060,881 | ||
Series 2007-HE1, Class A3 1,2 | 0.61 | 05/25/37 | 1,572 | 564,912 | ||
Series 2007-HE1, Class A4 1,2 | 0.68 | 05/25/37 | 2,980 | 1,088,254 | ||
Series 2006-HE1, Class A4 1,2 | 0.75 | 03/25/36 | 666 | 409,524 | ||
JP Morgan Resecuritization Trust | ||||||
Series 2012-2, Class 1A8 5,7 (Acquired 06/25/14, Cost $4,754,255, 1.3%) | 2.73 | 03/26/37 | 5,781 | 4,815,188 | ||
Lehman ABS Manufactured Housing Contract Trust | ||||||
Series 2001-B, Class M1 | 6.63 | 04/15/40 | 5,300 | 5,677,466 | ||
MASTR Asset Backed Securities Trust | ||||||
Series 2006-NC3, Class A3 1,2 | 0.55 | 10/25/36 | 2,217 | 1,300,252 | ||
Series 2006-NC2, Class A4 1,2 | 0.60 | 08/25/36 | 10,195 | 4,980,112 | ||
Series 2006-NC3, Class A4 1,2 | 0.61 | 10/25/36 | 7,740 | 4,603,135 | ||
Series 2006-HE5, Class A3 1,2 | 0.61 | 11/25/36 | 14,004 | 8,739,563 | ||
Series 2005-NC2, Class A4 1,2 | 1.15 | 11/25/35 | 7,251 | 4,794,146 | ||
Mid-State Trust X | ||||||
Series 10, Class B | 7.54 | 02/15/36 | 3,127 | 3,379,999 | ||
Nomura Resecuritization Trust | ||||||
Series 2013-1R, Class 3A12 1,2,5 | 0.61 | 10/26/36 | 16,637 | 14,460,532 | ||
Series 2014-1R, Class 2A11 1,5 | 0.72 | 02/26/37 | 15,432 | 8,108,186 | ||
Series 2015-11R, Class 4A5 5 | 2.51 | 06/26/37 | 1,681 | 821,220 | ||
Series 2015-4R, Class 3A8 5 | 2.68 | 02/26/36 | 10,470 | 7,499,926 | ||
Series 2014-6R, Class 5A7 5 | 2.70 | 04/26/37 | 4,852 | 3,170,959 | ||
Series 2015-1R, Class 4A7 5 | 2.79 | 12/26/37 | 2,752 | 1,416,839 | ||
Series 2015-1R, Class 3A7 5 | 2.90 | 03/26/37 | 5,919 | 3,405,350 | ||
Series 2014-2R, Class 1A7 5 | 2.94 | 01/26/36 | 3,346 | 2,415,806 | ||
Series 2015-6R, Class 2A4 5 | 7.78 | 01/26/37 | 8,311 | 6,349,364 | ||
RALI Trust | ||||||
Series 2007-QO3, Class A1 1,2,3 | 0.61 | 03/25/47 | 4,211 | 3,428,751 | ||
Series 2006-QO7, Class 2A1 1,3 | 1.29 | 09/25/46 | 8,422 | 6,001,457 |
Schedule of Investments (continued)
Interest Rate | Maturity | Principal Amount (000s) | Value | |||
RESIDENTIAL MORTGAGE RELATED HOLDINGS (continued) | ||||||
RBSSP Resecuritization Trust | ||||||
Series 2009-13, Class 7A2 5,7 (Acquired 04/19/13, Cost $1,441,875, 0.4%) | 5.75% | 01/26/36 | $ 1,500 | $ 1,594,326 | ||
Residential Asset Securitization Trust | ||||||
Series 2005-A13, Class 1A1 1 | 1.15 | 10/25/35 | 3,270 | 2,452,847 | ||
RFMSI Trust | ||||||
Series 2007-S3, Class 1A5 | 5.50 | 03/25/37 | 4,389 | 3,845,020 | ||
Securitized Asset Backed Receivables LLC Trust | ||||||
Series 2006-NC3, Class A2B 1,2 | 0.60 | 09/25/36 | 7,985 | 3,933,544 | ||
Series 2007-BR4, Class A2B 1,2 | 0.65 | 05/25/37 | 6,057 | 3,590,714 | ||
Series 2007-BR4, Class A2C 1,2 | 0.74 | 05/25/37 | 6,796 | 4,085,165 | ||
Washington Mutual Mortgage Pass-Through Certificates Trust | ||||||
Series 2007-OA1, Class A1A 1,3 | 1.14 | 02/25/47 | 4,911 | 3,763,706 | ||
Series 2007-HY5, Class 1A1 1 | 2.38 | 05/25/37 | 6,262 | 5,378,045 | ||
Series 2006-AR10, Class 1A2 | 2.47 | 09/25/36 | 2,625 | 2,366,646 | ||
Series 2007-HY5, Class 3A1 1 | 4.32 | 05/25/37 | 1,751 | 1,525,926 | ||
Wells Fargo Mortgage Backed Securities Trust | ||||||
Series 2005-2, Class 1B1 | 5.50 | 04/25/35 | 6,666 | 5,455,359 | ||
Total Non-Agency Mortgage-Backed Securities | 295,825,726 | |||||
Total RESIDENTIAL MORTGAGE RELATED HOLDINGS (Cost $319,441,021) | 295,825,726 | |||||
COMMERCIAL MORTGAGE RELATED HOLDINGS – 20.9% | ||||||
Commercial Mortgage-Backed Securities – 20.9% | ||||||
Banc of America Commercial Mortgage Trust | ||||||
Series 2006-6, Class AJ 3 | 5.42 | 10/10/45 | 14,010 | 13,966,346 | ||
Series 2007-3, Class AJ 3 | 5.72 | 06/10/49 | 10,600 | 10,653,541 | ||
Class B Notes - 885 Trademark 6,7,8 | ||||||
(Acquired 10/28/2015, Cost $1,800,000, 0.5%) | 10.50 | 10/01/19 | 1,800 | 1,800,000 | ||
Class B Notes - Browns Bridge 6,7,8 | ||||||
(Acquired 10/28/2015, Cost $118,000, 0.0%) | 9.50 | 11/01/20 | 118 | 118,000 | ||
Class B Notes - Cedar Park 6,7,8 | ||||||
(Acquired 06/25/15, Cost $600,000, 0.2%) | 11.00 | 05/31/17 | 600 | 600,000 | ||
Class B Notes - Cherokee 6,7,8 | ||||||
(Acquired 10/28/2015, Cost $243,000, 0.1%) | 9.50 | 11/01/20 | 243 | 243,000 | ||
Class B Notes - Concord 6,7,8 | ||||||
(Acquired 10/28/2015, Cost $312,873, 0.1%) | 9.50 | 11/01/20 | 313 | 312,873 | ||
Class B Notes - Crossroads 6,7,8 | ||||||
(Acquired 10/28/2015, Cost $170,000, 0.0%) | 9.50 | 11/01/20 | 170 | 170,000 | ||
Class B Notes - Fayetteville 6,7,8 | ||||||
(Acquired 10/28/2015, Cost $48,000, 0.0%) | 9.50 | 11/01/20 | 48 | 48,000 | ||
Class B Notes - Holiday Inn 6,7,8 | ||||||
(Acquired 06/25/15, Cost $2,000,000, 0.5%) | 10.08 | 07/01/20 | 2,000 | 1,942,400 | ||
Class B Notes - Lee & White 6,7,8 | ||||||
(Acquired 10/28/2015, Cost $91,000, 0.0%) | 9.50 | 11/01/20 | 91 | 91,000 | ||
Class B Notes - Marshalls 6,7,8 | ||||||
(Acquired 10/28/2015, Cost $386,000, 0.1%) | 9.50 | 11/01/20 | 386 | 386,000 |
Schedule of Investments (continued)
Interest Rate | Maturity | Principal Amount (000s) | Value | |||
COMMERCIAL MORTGAGE RELATED HOLDINGS (continued) | ||||||
Class B Notes - Meadows 6,7,8 | ||||||
(Acquired 10/28/2015, Cost $68,000, 0.0%) | 9.50% | 11/01/20 | $ 68 | $ 68,000 | ||
Class B Notes - Moreland Avenue 6,7,8 | ||||||
(Acquired 11/16/2015, Cost $225,000, 0.1%) | 9.50 | 11/01/20 | 225 | 225,000 | ||
Class B Notes - North River 6,7,8 | ||||||
(Acquired 10/28/2015, Cost $246,000, 0.1%) | 9.50 | 11/01/20 | 246 | 246,000 | ||
Class B Notes - Town and Country 6,7,8 | ||||||
(Acquired 10/28/2015, Cost $492,000, 0.1%) | 9.50 | 11/01/20 | 492 | 492,000 | ||
Commercial Mortgage Trust | ||||||
Series 2007-GG11, Class AJ 3 | 6.24 | 12/10/49 | 10,642 | 10,690,698 | ||
LB-UBS Commercial Mortgage Trust | ||||||
Series 2007-C1, Class AJ | 5.48 | 02/15/40 | 1,590 | 1,598,727 | ||
Series 2007-C7, Class AJ 3 | 6.45 | 09/15/45 | 10,000 | 10,003,236 | ||
Morgan Stanley Capital I, Inc. | ||||||
Series 1998-HF1, Class K 5,7,8 (Acquired 06/26/13, Cost $2,514,933, 0.7%) | 6.19 | 03/15/30 | 2,579 | 2,550,787 | ||
Wachovia Bank Commercial Mortgage Trust | ||||||
Series 2007-C30, Class AJ 3 | 5.41 | 12/15/43 | 11,500 | 11,481,846 | ||
Series 2007-C33, Class AJ 3 | 6.15 | 02/15/51 | 10,250 | 10,165,263 | ||
Total Commercial Mortgage-Backed Securities | 77,852,717 | |||||
Total COMMERCIAL MORTGAGE RELATED HOLDINGS (Cost $78,399,563) | 77,852,717 | |||||
INTEREST-ONLY SECURITIES – 0.6% | ||||||
Federal Home Loan Mortgage Corporation Strips | ||||||
Series 304, Class C60 7,9 (Acquired 03/12/14, Cost $2,279,552, 0.3%) | 3.50 | 12/15/42 | 7,391 | 1,258,845 | ||
Federal National Mortgage Association REMICS | ||||||
Series 2013-32, Class IG 7,9 (Acquired 04/29/14, Cost $1,562,504, 0.2%) | 3.50 | 04/25/33 | 6,364 | 795,354 | ||
JP Morgan Trust | ||||||
Series 2014-5, Class AX4 5,9 | 0.50 | 10/25/29 | 17,789 | 292,964 | ||
Total INTEREST-ONLY SECURITIES (Cost $3,409,682) | 2,347,163 | |||||
CORPORATE BONDS – 8.4% | ||||||
Automotive – 0.4% | ||||||
American Axle & Manufacturing, Inc. 3 | 6.63 | 10/15/22 | 1,300 | 1,391,000 | ||
Basic Industry – 0.9% | ||||||
Arch Coal, Inc. 10 | 7.25 | 06/15/21 | 1,750 | 26,250 | ||
Hexion, Inc. | 9.00 | 11/15/20 | 1,350 | 891,000 | ||
INEOS Group Holdings SA 3,5,11 | 6.13 | 08/15/18 | 1,350 | 1,362,656 | ||
PulteGroup, Inc. 3 | 6.38 | 05/15/33 | 1,000 | 1,037,500 | ||
Total Basic Industry | 3,317,406 | |||||
Consumer Goods – 0.7% | ||||||
ACCO Brands Corp. 3 | 6.75 | 04/30/20 | 1,350 | 1,429,313 | ||
Post Holdings, Inc. 3 | 7.38 | 02/15/22 | 1,300 | 1,366,625 | ||
Total Consumer Goods | 2,795,938 |
Schedule of Investments (continued)
Interest Rate | Maturity | Principal Amount (000s) | Value | |||
CORPORATE BONDS (continued) | ||||||
Energy – 0.6% | ||||||
Blue Racer Midstream LLC 5 | 6.13% | 11/15/22 | $ 425 | $ 402,688 | ||
Crestwood Midstream Partners LP 5 | 6.25 | 04/01/23 | 325 | 299,000 | ||
Ferrellgas Partners LP 3 | 8.63 | 06/15/20 | 700 | 700,000 | ||
Global Partners LP 3 | 6.25 | 07/15/22 | 500 | 416,250 | ||
ION Geophysical Corp. 5 | 9.13 | 12/15/21 | 500 | 271,250 | ||
Total Energy | 2,089,188 | |||||
Healthcare – 1.2% | ||||||
CHS/Community Health Systems, Inc. 3 | 7.13 | 07/15/20 | 1,300 | 1,205,217 | ||
HCA, Inc. 3 | 5.25 | 06/15/26 | 1,300 | 1,349,562 | ||
Kindred Healthcare, Inc. 3 | 6.38 | 04/15/22 | 1,150 | 1,026,375 | ||
Quorum Health Corp. 5 | 11.63 | 04/15/23 | 325 | 326,625 | ||
Tenet Healthcare Corp. 3 | 8.13 | 04/01/22 | 600 | 614,880 | ||
Total Healthcare | 4,522,659 | |||||
Leisure – 1.0% | ||||||
Boyd Gaming Corp. 3 | 9.00 | 07/01/20 | 1,300 | 1,365,812 | ||
Isle of Capri Casinos, Inc. 3 | 5.88 | 03/15/21 | 850 | 881,875 | ||
MGM Resorts International 3 | 7.75 | 03/15/22 | 1,250 | 1,412,500 | ||
Total Leisure | 3,660,187 | |||||
Media – 0.8% | ||||||
CCO Holdings LLC 3 | 5.75 | 01/15/24 | 725 | 762,990 | ||
Cumulus Media Holdings, Inc. | 7.75 | 05/01/19 | 600 | 246,000 | ||
Lamar Media Corp. 3 | 5.38 | 01/15/24 | 1,350 | 1,397,250 | ||
Mediacom Broadband LLC 3 | 6.38 | 04/01/23 | 350 | 365,750 | ||
Neptune Finco Corp. 5 | 10.88 | 10/15/25 | 325 | 371,514 | ||
Total Media | 3,143,504 | |||||
Retail – 0.5% | ||||||
L Brands, Inc. 3 | 7.60 | 07/15/37 | 900 | 933,750 | ||
New Albertsons, Inc. 3 | 7.75 | 06/15/26 | 850 | 828,750 | ||
Total Retail | 1,762,500 | |||||
Services – 0.6% | ||||||
Avis Budget Car Rental LLC 3 | 5.50 | 04/01/23 | 1,400 | 1,379,000 | ||
Casella Waste Systems, Inc. 3 | 7.75 | 02/15/19 | 964 | 983,883 | ||
Total Services | 2,362,883 | |||||
Telecommunications – 1.7% | ||||||
CenturyLink, Inc. | 7.65 | 03/15/42 | 1,000 | 845,000 | ||
FairPoint Communications, Inc. 3,5 | 8.75 | 08/15/19 | 925 | 911,125 | ||
Frontier Communications Corp. 3 | 11.00 | 09/15/25 | 1,125 | 1,164,375 | ||
Intelsat Luxembourg SA 11 | 7.75 | 06/01/21 | 650 | 159,250 | ||
Qwest Capital Funding, Inc. | 6.88 | 07/15/28 | 250 | 202,500 | ||
T-Mobile USA, Inc. 3 | 6.63 | 04/01/23 | 1,350 | 1,430,163 | ||
Windstream Services LLC | 7.50 | 06/01/22 | 1,000 | 900,000 |
Schedule of Investments (continued)
Interest Rate | Maturity | Principal Amount (000s) | Value | |||
CORPORATE BONDS (continued) | ||||||
Zayo Group LLC | 6.00% | 04/01/23 | $ 625 | $ 634,375 | ||
Total Telecommunications | 6,246,788 | |||||
Total CORPORATE BONDS (Cost $34,352,763) | 31,292,053 |
Shares | Value | |||||
PREFERRED STOCKS – 2.7% | ||||||
Finance & Investment – 2.6% | ||||||
Kimco Realty Corp., 6.00% | 157,837 | $ 4,100,605 | ||||
Public Storage, 6.00% | 200,000 | 5,638,000 | ||||
Total Finance & Investment | 9,738,605 | |||||
Telecommunications – 0.1% | ||||||
Regency Centers Corp., 6.63% | 21,213 | 552,174 | ||||
Total PREFERRED STOCKS (Cost $9,502,399) | 10,290,779 | |||||
COMMON STOCK – 0.0% | ||||||
Energy – 0.0% | ||||||
ION Geophysical Corp. 12 | 5,000 | 31,150 | ||||
Total COMMON STOCK (Cost $44,550) | 31,150 | |||||
Total Investments – 112.0% (Cost $445,149,978) | 417,639,588 | |||||
Liabilities in Excess of Other Assets – (12.0)% | (44,889,010) | |||||
TOTAL NET ASSETS – 100.0% | $ 372,750,578 |
The following notes should be read in conjunction with the accompanying Schedule of Investments. | |
1 | — Variable rate security – Interest rate shown is the rate in effect as of June 30, 2016. |
2 | — Security is a “step up” bond where the coupon increases or steps up at a predetermined date. |
3 | — Portion or entire principal amount delivered as collateral for reverse repurchase agreements. |
4 | — Security is an inverse floating rate bond. |
5 | — Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may only be resold in transactions exempt from registration, normally to qualified institutional buyers. As of June 30, 2016, the total value of all such securities was $106,481,525 or 28.6% of net assets. |
6 | — Private Placement. |
7 | — Restricted Illiquid Securities - Securities that the Adviser has deemed illiquid pursuant to procedures adopted by the Fund's Board of Directors. The values in the parenthesis represent the acquisition date, cost and the percentage of net assets, respectively. As of June 30, 2016, the total value of all such securities was $37,349,063 or 10.0% of net assets. |
8 | — Security fair valued in good faith pursuant to the fair value procedures adopted by the Board of Directors. As of June 30, 2016, the total value of all such securities was $9,293,060 or 2.5% of net assets. |
9 | — Interest rate is based on the notional amount of the underlying mortgage pools. |
10 | — Issuer is currently in default on its regularly scheduled interest payment. |
11 | — Foreign security or a U.S. security of a foreign company. |
12 | — Non-income producing security. |
Statement of Assets and Liabilities
Assets: | |
Investments in securities, at value (cost $445,149,978) | $417,639,588 |
Cash | 57,694,381 |
Cash on deposit with brokers for futures and reverse repurchase agreements | 6,122,640 |
Interest and dividend receivable | 1,801,094 |
Prepaid expenses | 18,293 |
Total assets | 483,275,996 |
Liabilities: | |
Reverse repurchase agreements (Note 6) | 109,518,000 |
Interest payable for reverse repurchase agreements (Note 6) | 357,151 |
Payable for variation margin (Note 8) | 29,623 |
Investment advisory fee payable (Note 4) | 403,273 |
Administration fee payable (Note 4) | 60,491 |
Directors' fee payable | 9,205 |
Accrued expenses | 147,675 |
Total liabilities | 110,525,418 |
Commitments and contingencies (Note 10) | |
Net Assets | $372,750,578 |
Composition of Net Assets: | |
Capital stock, at par value ($0.001 par value, 1,000,000,000 shares authorized) (Note 7) | $ 22,714 |
Additional paid-in capital (Note 7) | 422,415,721 |
Distributions in excess of net investment income | (60,355) |
Accumulated net realized loss on investment and futures transactions | (21,877,249) |
Net unrealized depreciation on investments and futures | (27,750,253) |
Net assets applicable to capital stock outstanding | $372,750,578 |
Shares Outstanding and Net Asset Value Per Share: | |
Common shares outstanding | 22,713,931 |
Net asset value per share | $ 16.41 |
Statement of Operations
Investment Income (Note 2): | |
Interest | $ 40,632,013 |
Dividends | 464,563 |
Total income | 41,096,576 |
Expenses: | |
Investment advisory fees (Note 4) | 5,254,073 |
Administration fees (Note 4) | 788,111 |
Reports to stockholders | 117,464 |
Directors' fees | 115,256 |
Fund accounting servicing fees | 110,982 |
Legal fees | 80,382 |
Audit and tax services | 77,444 |
Miscellaneous | 62,136 |
Insurance | 34,504 |
Custodian fees | 27,335 |
Registration fees | 25,076 |
Transfer agent fees | 17,108 |
Total operating expenses | 6,709,871 |
Interest expense on reverse repurchase agreements (Note 6) | 2,386,292 |
Total expenses | 9,096,163 |
Net investment income | 32,000,413 |
Realized and Unrealized Loss on Investments: | |
Net realized loss on: | |
Investment transactions | (14,975,020) |
Futures transactions | (1,859,830) |
Net realized loss | (16,834,850) |
Net change in unrealized depreciation on: | |
Investments | (20,148,498) |
Futures | (184,166) |
Net change in unrealized depreciation | (20,332,664) |
Net realized and unrealized loss | (37,167,514) |
Net decrease in net assets resulting from operations | $ (5,167,101) |
Statements of Changes in Net Assets
For the Fiscal Year Ended June 30, 2016 | For the Fiscal Year Ended June 30, 2015 | ||
Increase (Decrease) in Net Assets Resulting from Operations: | |||
Net investment income | $ 32,000,413 | $ 32,336,058 | |
Net realized loss on investment and futures transactions | (16,834,850) | (2,171,922) | |
Net change in unrealized depreciation on investments and futures | (20,332,664) | (18,943,553) | |
Net increase (decrease) in net assets resulting from operations | (5,167,101) | 11,220,583 | |
Distributions to Stockholders: | |||
Net investment income | (32,179,126) | (32,705,299) | |
Return of capital | (2,464,162) | (1,937,989) | |
Total distributions paid | (34,643,288) | (34,643,288) | |
Total decrease in net assets | (39,810,389) | (23,422,705) | |
Net Assets: | |||
Beginning of year | 412,560,967 | 435,983,672 | |
End of year | $372,750,578 | $412,560,967 | |
Distributions in excess of net investment income | $ (60,355) | $ (65,492) |
Statement of Cash Flows
Increase (Decrease) in Cash: | |
Cash flows provided by (used for) operating activities: | |
Net decrease in net assets resulting from operations | $ (5,167,101) |
Adjustments to reconcile net decrease in net assets resulting from operations to net cash provided by operating activities: | |
Purchases of portfolio investments and principal payups | (49,711,655) |
Proceeds from disposition of long-term portfolio investments and principal paydowns | 168,200,116 |
Decrease in cash on deposit with brokers for futures and reverse repurchase agreements | 1,247,839 |
Decrease in interest and dividend receivable | 379,780 |
Decrease in principal paydown receivable | 275,808 |
Decrease in receivable for variation margin | 28,343 |
Increase in prepaid expenses | (10,552) |
Decrease in interest payable for reverse repurchase agreements | (405,469) |
Increase in payable for variation margin | 29,623 |
Decrease in investment advisory fee payable | (71,654) |
Decrease in administration fee payable | (10,748) |
Decrease in directors' fee payable | (1,434) |
Decrease in accrued expenses | (19,683) |
Net amortization on investments and paydown gains or losses on investments | (22,161,107) |
Net change in unrealized depreciation on investments | 20,148,498 |
Net realized loss on investment transactions | 14,975,020 |
Net cash provided by operating activities | 127,725,624 |
Cash flows used for financing activities: | |
Net cash used for reverse repurchase agreements | (53,251,000) |
Distributions paid to stockholders | (34,643,288) |
Net cash used for financing activities | (87,894,288) |
Net increase in cash | 39,831,336 |
Cash at beginning of year | 17,863,045 |
Cash at end of year | $ 57,694,381 |
Supplemental Disclosure of Cash Flow Information: | |
Interest payments on reverse repurchase agreements for the fiscal year ended June 30, 2016 totaled $2,791,761. |
Financial Highlights
For the Fiscal Years Ended June 30 | For the period from March 26, 20131 through June 30, | ||||||
2016 | 2015 | 2014 | 2013 | ||||
Per Share Operating Performance: | |||||||
Net asset value, beginning of period | $ 18.16 | $ 19.19 | $ 18.33 | $ 19.102 | |||
Net investment income | 1.41 3 | 1.42 3 | 1.32 | 0.17 | |||
Net realized and unrealized gain (loss) on investment and futures transactions | (1.63) | (0.92) | 1.07 | (0.69) | |||
Net increase (decrease) in net asset value resulting from operations | (0.22) | 0.50 | 2.39 | (0.52) | |||
Distributions from net investment income | (1.42) | (1.44) | (1.32) | (0.18) | |||
Return of capital distributions | (0.11) | (0.09) | (0.21) | (0.07) | |||
Total distributions paid | (1.53) | (1.53) | (1.53) | (0.25) | |||
Net asset value, end of period | $ 16.41 | $ 18.16 | $ 19.19 | $ 18.33 | |||
Market price, end of period | $ 14.87 | $ 15.81 | $ 17.60 | $ 18.46 | |||
Total Investment Return based Net asset value† | -1.13% | 2.67% | 13.62% | -2.72% 4 | |||
Total Investment Return based on Market price† | 4.20% | -1.53% | 4.32% | -6.44% 4 | |||
Ratios to Average Net Assets/Supplementary Data: | |||||||
Net assets, end of period (000s) | $372,751 | $412,561 | $435,984 | $416,289 | |||
Operating expenses excluding interest expense | 1.74% | 1.74% | 1.48% | 1.44% 5 | |||
Interest expense | 0.62% | 0.58% | 0.22% | 0.00% 5,6 | |||
Total expenses | 2.36% | 2.32% | 1.70% | 1.44% 5 | |||
Net investment income | 8.29% | 7.59% | 7.10% | 3.36% 5 | |||
Portfolio turnover rate | 10% | 32% | 41% | 2% 4 | |||
Reverse repurchase agreements, end of period (000s) | $109,518 | $162,769 | $152,582 | $ 4,438 | |||
Asset Coverage per $1,000 unit of senior indebtedness7 | $ 4,404 | $ 3,535 | $ 3,857 | $94,801 |
† | Total investment return based on Market price is computed based upon the New York Stock Exchange market price of the Fund’s shares and excludes the effect of broker commissions. Distributions are assumed to be reinvested at the prices obtained under the Fund’s dividend reinvestment plan. Total investment return based on Net asset value is computed by determining the percentage change in net asset value (NAV). The returns do not reflect broker sales charges or commissions, if any. Distributions are assumed to be reinvested at the prices obtained under the Fund’s dividend reinvestment plan. Performance includes the reinvestment of income dividends and capital gains distribution, if any. |
1 | Commencement of operations. |
2 | Net asset value, beginning of period, reflects a deduction of $0.90 per share sales charge from the initial public offering price of $20.00 per share. |
3 | Per share amounts presented are based on average shares outstanding throughout the period indicated. |
4 | Not annualized. |
5 | Annualized. |
6 | Interest expense ratio was less than 0.01%. |
7 | Calculated by subtracting the Fund's total liabilities (not including borrowings) from the Fund's total assets and dividing by the total number of senior indebtedness units, where one unit equals $1,000 of senior indebtedness. |
Notes to Financial Statements
Notes to Financial Statements (continued)
Level 1 - | quoted prices in active markets for identical assets or liabilities |
Level 2 - | quoted prices in markets that are not active or other significant observable inputs (including, but not limited to: quoted prices for similar assets or liabilities, quoted prices based on recently executed transactions, interest rates, prepayment speeds, credit risk, etc.) |
Notes to Financial Statements (continued)
Level 3 - | significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets or liabilities) |
Valuation Inputs | Level 1 | Level 2 | Level 3(1) | Total | |||
Residential Mortgage Related Holdings | $ — | $ — | $ 295,825,726 | $ 295,825,726 | |||
Commercial Mortgage Related Holdings | — | — | 77,852,717 | 77,852,717 | |||
Interest-Only Securities | — | — | 2,347,163 | 2,347,163 | |||
Corporate Bonds | — | 31,292,053 | — | 31,292,053 | |||
Preferred Stocks | 10,290,779 | — | — | 10,290,779 | |||
Common Stock | 31,150 | — | — | 31,150 | |||
Total | $ 10,321,929 | $ 31,292,053 | $ 376,025,606 | $ 417,639,588 |
Liabilities | Level 1 | Level 2 | Level 3 | Total | |||
Other Financial Instruments(2) | $ (239,863) | $ — | $ — | $ (239,863) | |||
Total Liabilities - Other Financial Instruments | $ (239,863) | $ — | $ — | $ (239,863) |
Notes to Financial Statements (continued)
Quantitative Information about Level 3 Fair Value Measurements(1) | ||||
Value as of June 30, 2016 | Valuation Methodology | Significant Unobservable Input | Range (Weighted Average) | |
Commercial Mortgage Related Holdings: | ||||
Class B Notes | $6,742,273 | Discounted Cash Flow | Yield (Discount Rate of Cash Flows) | 9.5%-11.6% (10.5%) |
Morgan Stanley Capital I, Inc. Series 1998-HF1, Class K | 2,550,787 | Discounted Cash Flow | Yield (Discount Rate of Cash Flows) | 7.00% (7.00%) |
Total | $9,293,060 |
Investments in Securities | Residential Mortgage Related Holdings | Commercial Mortgage Related Holdings | Interest-Only Securities | Collateralized Loan Obligation | Total | ||||
Balance as of June 30, 2015 | $ 373,105,646 | $107,786,402 | $3,150,630 | $ 3,955,200 | $ 487,997,878 | ||||
Accrued Discounts (Premiums) | 11,220,950 | (117,583) | — | — | 11,103,367 | ||||
Realized Gain (Loss) | 5,074,730 | 669,943 | — | (2,170,000) | 3,574,673 | ||||
Change in Unrealized Appreciation (Depreciation) | (18,609,760) | (2,512,258) | (701,186) | 14,800 | (21,808,404) | ||||
Purchases at cost | 37,201,728 | 8,092,854 | 330,846 | — | 45,625,428 | ||||
Sales proceeds | (112,167,568) | (36,066,641) | (433,127) | (1,800,000) | (150,467,336) | ||||
Balance as of June 30, 2016 | $ 295,825,726 | $ 77,852,717 | $2,347,163 | $ — | $ 376,025,606 | ||||
Change in unrealized gains or losses relating to assets still held at the reporting date | $ (20,231,084) | $ (2,385,459) | $ (701,186) | $ — | $ (23,317,729) |
Notes to Financial Statements (continued)
Notes to Financial Statements (continued)
Derivatives | Statement of Assets and Liabilities | Fair Value as of June 30, 2016 |
Futures contracts | Payable for variation margin (liabilities) | $29,623 |
Notes to Financial Statements (continued)
Derivatives | Location of Gains (Losses) on Derivatives Recognized in Income | Net Realized Loss on Futures Transactions | Net Change in Unrealized Depreciation on Futures |
Futures contracts | Futures transactions | $(1,859,830) | $(184,166) |
Notes to Financial Statements (continued)
Notes to Financial Statements (continued)
Counterparty | Borrowing Rate | Borrowing Date | Maturity Date | Amount Borrowed(1) | Payable for Reverse Repurchase Agreements | |
RBC Capital Markets | 1.38% | 04/04/16 | 07/05/16 | $ 1,527,000 | $ 1,532,146 | |
RBC Capital Markets | 1.38% | 04/05/16 | 07/05/16 | 5,740,000 | 5,759,130 | |
RBC Capital Markets | 1.38% | 05/12/16 | 08/12/16 | 1,666,000 | 1,669,189 | |
RBC Capital Markets | 1.38% | 05/19/16 | 08/19/16 | 4,499,000 | 4,506,389 | |
RBC Capital Markets | 1.38% | 06/03/16 | 08/19/16 | 962,000 | 963,029 | |
RBC Capital Markets | 1.41% | 06/14/16 | 09/14/16 | 6,047,000 | 6,051,014 | |
RBC Capital Markets | 1.41% | 06/28/16 | 09/14/16 | 763,000 | 763,089 | |
RBC Capital Markets | 1.88% | 04/06/16 | 07/06/16 | 7,788,000 | 7,822,979 | |
RBC Capital Markets | 1.88% | 05/19/16 | 08/19/16 | 8,424,000 | 8,442,867 | |
RBC Capital Markets | 1.93% | 04/04/16 | 07/05/16 | 7,983,000 | 8,020,635 | |
RBC Capital Markets | 1.93% | 04/06/16 | 07/06/16 | 20,061,000 | 20,153,497 | |
RBC Capital Markets | 1.93% | 05/12/16 | 08/12/16 | 9,048,000 | 9,072,230 | |
RBC Capital Markets | 1.98% | 04/04/16 | 07/05/16 | 3,234,000 | 3,249,641 | |
RBC Capital Markets | 2.08% | 06/03/16 | 09/02/16 | 2,738,000 | 2,742,432 | |
RBC Capital Markets | 2.12% | 05/26/16 | 08/26/16 | 14,162,000 | 14,191,957 | |
Wells Fargo | 1.98% | 04/20/16 | 07/20/16 | 14,876,000 | 14,934,927 | |
Total | $109,518,000 | $109,875,151 |
Overnight and Continuous | Up to 30 Days | 30 to 90 Days | Greater Than 90 Days | Total | |||||
Residential Mortgage Related Holdings | $— | $18,110,000 | $16,900,000 | $— | $ 35,010,000 | ||||
Commercial Mortgage Related Holdings | — | 35,832,000 | 17,472,000 | — | 53,304,000 | ||||
Corporate Bonds | — | 7,267,000 | 13,937,000 | — | 21,204,000 | ||||
Total | $— | $61,209,000 | $48,309,000 | $— | $109,518,000 |
Gross Amounts not offset in the Statement of Assets and Liabilities | ||||||
Gross Amounts of Recognized Liabilities | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Pledged (Received)* | Net Amount | |
Description | ||||||
Reverse Repurchase Agreements | $109,518,000 | $— | $109,518,000 | $(109,518,000) | $— | $— |
Notes to Financial Statements (continued)
Notes to Financial Statements (continued)
Contracts | Type | Expiration Date | Value at June 30, 2016 | Unrealized Depreciation | |
220 | 2 Year U.S. Treasury Note | September 2016 | $48,252,188 | $(298,536) | |
$48,252,188 | $(298,536) |
Contracts | Type | Expiration Date | Value at June 30, 2016 | Unrealized Appreciation | |
15 | 5 Year U.S. Treasury Note | September 2016 | $1,832,461 | $ 9,399 | |
17 | 10 Year U.S. Treasury Note | September 2016 | 2,260,734 | 49,274 | |
$4,093,195 | $58,673 |
2016 | 2015 | ||
Ordinary income (including short-term capital gains) | $32,179,126 | $32,705,299 | |
Return of capital | 2,464,162 | 1,937,989 | |
Total distributions | $34,643,288 | $34,643,288 |
Other accumulated losses | $ (60,355) |
Capital loss carryforward(1) | (9,796,323) |
Post-October capital loss deferral | (12,320,789) |
Tax basis unrealized depreciation on investments | (27,510,390) |
Total tax basis net accumulated losses | $(49,687,857) |
Notes to Financial Statements (continued)
Cost of Investments | Gross Unrealized Appreciation | Gross Unrealized Depreciation | Net Unrealized Depreciation |
$445,149,978 | $5,488,573 | $(32,998,963) | $(27,510,390) |
Undistributed net investment income | Accumulated net realized loss |
$183,850 | $(183,850) |
Notes to Financial Statements (continued)
Dividend Per Share | Record Date | Payable Date |
$0.1271 | July 21, 2016 | July 28, 2016 |
$0.1271 | August 18, 2016 | August 25, 2016 |
Report of Independent Registered Public Accounting Firm
Tax Information (Unaudited)
Compliance Certification (Unaudited)
Information Concerning Directors and Officers (Unaudited)
Name, Address and Year of Birth | Position(s) Held with Funds | Principal Occupation(s) During Past 5 Years and Other Directorships Held by Director | Number of Portfolios in Fund Complex | |||
Independent Director Class I Director to serve until 2017 Annual Meeting of Stockholders: | ||||||
Heather Goldman c/o Brookfield Place, 250 Vesey Street, New York, New York 10281-1023 Born: 1967 | Director, Member of the Audit Committee, Member of the Nominating and Compensation Committee Served Since 2013 | Director/Trustee of several investment companies advised by the Adviser (2013-Present); Global Head of Marketing and Business Development of the Adviser (2011-2013); Managing Partner of Brookfield Financial (2009-2011); Director and Board Chair of University Settlement House (2003-2013); Member of the Honorary Board of University Settlement House (2014-Present); Co-Founder & President of Capstak, Inc. (2014-Present). | 9 | |||
Independent Directors Class II Directors to serve until 2018 Annual Meeting of Stockholders: | ||||||
Edward A. Kuczmarski c/o Brookfield Place, 250 Vesey Street, New York, New York 10281-1023 Born: 1949 | Director, Chairman of the Board, Member of the Audit Committee, Chairman of the Nominating and Compensation Committee Served Since 2013 | Director/Trustee of several investment companies advised by the Adviser (2011-Present); Certified Public Accountant and Retired Partner of Crowe Horwath LLP (1980-2013); Trustee of the Empire Builder Tax Free Bond Fund (1984-2013); Director of ISI Funds (2007-2015); Trustee of the Daily Income Fund (2006-2015), Director of the California Daily Tax Free Income Fund, Inc. (2006-2015); Trustee of the Stralem Funds (2014-Present). | 9 | |||
Stuart A. McFarland c/o Brookfield Place, 250 Vesey Street, New York, New York 10281-1023 Born: 1947 | Director, Member of the Audit Committee, Member of the Nominating and Compensation Committee Served Since 2013 | Director/Trustee of several investment companies advised by the Adviser (2006-Present); Director of United Guaranty Corporation (2011-Present); Director of Brandywine Funds (2003-2013); Director of New Castle Investment Corp. (2000-Present); Managing Partner of Federal City Capital Advisors (1997-Present); Director of New America High Income Fund (2013-Present); Director of New Senior Investment Group, Inc. (2014-Present). | 9 | |||
Independent Director Class III Director to serve until 2016 Annual Meeting of Stockholders: | ||||||
Louis P. Salvatore c/o Brookfield Place, 250 Vesey Street, New York, New York 10281-1023 Born: 1946 | Director, Chairman of the Audit Committee, Member of the Nominating and Compensation Committee Served Since 2013 | Director/Trustee of several investment companies advised by the Adviser (2005-Present); Director of SP Fiber Technologies, Inc. (2012-2015); Director of Gramercy Property Trust (2012-Present); Director of Turner Corp. (2003-Present); Director of Jackson Hewitt Tax Services, Inc. (2004-2011); Employee of Arthur Andersen LLP (2002-Present). | 9 |
Name, Address and Year of Birth | Position(s) Held with Funds | Principal Occupation(s) During Past 5 Years and Other Directorships Held by Director | Number of Portfolios in Fund Complex | |||
Interested Director Class III Director to serve until 2016 Annual Meeting of Stockholders: | ||||||
Jonathan C. Tyras c/o Brookfield Place, 250 Vesey Street, New York, New York 10281-1023 Born: 1968 | Director Served Since 2014 | Managing Director and Chief Financial Officer of the Adviser (2010-Present); General Counsel and Secretary of the Adviser (2006-Present); Director/Trustee of several investment companies advised by the Adviser (2012-Present); Secretary of several investment companies advised by the Adviser (2006-2014); Vice President of Brookfield Investment Funds (2011-2014); Chief Financial Officer of Brookfield Investment Management (UK) Limited (2011-Present); Director of Brookfield Investment Management (UK) Limited (2013-Present); Chief Financial Officer of Brookfield Investment Management (Canada) Inc. (2011-Present); Director of Brookfield Investment Management (Canada) Inc. (2015-Present); Chief Executive Officer of Brookfield Investment Management (US) LLC (2011-Present); Managing Director of AMP Capital Brookfield Pty Limited (2011-2012); Chairman of Brookfield Soundvest Capital Management (2015-Present). | 9 |
Name, Address and Year of Birth | Position(s) Held with Funds | Term of Office and Length of Time Served | Principal Occupation(s) During Past 5 Years |
Brian F. Hurley* c/o Brookfield Place, 250 Vesey Street, New York, New York 10281-1023 Born: 1977 | President | Since 2014 | President of several investment companies advised by the Adviser (2014-Present); Managing Director (2014-Present) and Assistant General Counsel (2010-Present) of the Adviser; Director of the Adviser (2010-2014); Secretary of Brookfield Investment Funds (2011-2014); Director of Brookfield Soundvest Capital Management (2015-Present). |
Angela W. Ghantous* c/o Brookfield Place, 250 Vesey Street, New York, New York 10281-1023 Born: 1975 | Treasurer | Since 2013 | Treasurer of several investment companies advised by the Adviser (2012-Present); Director of the Adviser (2012-Present); Vice President of the Adviser (2009-2012). |
Alexis I. Rieger* c/o Brookfield Place, 250 Vesey Street, New York, New York 10281-1023 Born: 1980 | Secretary | Since 2014 | Secretary of several investment companies advised by the Adviser (2014-Present); Vice President and Associate General Counsel of the Adviser (2011-Present). |
Seth Gelman* c/o Brookfield Place, 250 Vesey Street, New York, New York 10281-1023 Born: 1975 | Chief Compliance Officer (“CCO”) | Since 2013 | CCO of several investment companies advised by the Adviser (2009-Present); CCO of the Adviser (2009-Present); CCO of Brookfield Investment Management (UK) Limited (2013-Present). |
Board Considerations Relating to the Investment Advisory Agreements (Unaudited)
Board Considerations Relating to the Investment Advisory Agreements (Unaudited) (continued)
Board Considerations Relating to the Investment Advisory Agreements (Unaudited) (continued)
Dividend Reinvestment Plan (Unaudited)
Joint Notice of Privacy Policy (Unaudited)
• | Information we receive from you in applications or other forms, correspondence or conversations, including but not limited to name, address, phone number, social security number, assets, income and date of birth. |
• | Information about transactions with us, our affiliates, or others, including but not limited to account number, balance and payment history, parties to transactions, cost basis information, and other financial information. |
• | Information we may receive from our due diligence, such as your creditworthiness and your credit history. |
• | Unaffiliated service providers (e.g. transfer agents, securities broker-dealers, administrators, investment advisors or other firms that assist us in maintaining and supporting financial products and services provided to you); |
• | Government agencies, other regulatory bodies and law enforcement officials (e.g. for reporting suspicious transactions); |
• | Other organizations, with your consent or as directed by you; and |
• | Other organizations, as permitted or required by law (e.g. for fraud protection) |
Item 2. Code of Ethics.
As of the end of the period covered by this report, the Registrant had adopted a Code of Ethics for Principal Executive and Principal Financial Officers (the “Code”). There were no amendments to or waivers from the Code during the period covered by this report. A copy of the Registrant’s Code will be provided upon request to any person without charge by contacting Investor Relations at (855) 777-8001 or by writing to Secretary, Brookfield Mortgage Opportunity Income Fund Inc., Brookfield Place, 250 Vesey Street, 15th Floor, New York, NY 10281-1023.
Item 3. Audit Committee Financial Expert.
The Registrant’s Board of Directors has determined that four members serving on the Registrant’s audit committee are audit committee financial experts. Their names are Stuart A. McFarland, Edward A. Kuczmarski, Louis P. Salvatore and Heather S. Goldman. Messrs. McFarland, Kuczmarski, Salvatore and Mme. Goldman are each independent.
Item 4. Principal Accountant Fees and Services.
(a) | Audit Fees |
The aggregate fees billed by the Fund’s independent registered public accounting firm, Deloitte & Touche LLP (“Deloitte”), to the Funds for the Fund’s two most recent fiscal years for professional services rendered for the audit of the Registrant’s annual financial statements and the review of financial statements that are included in the Registrant’s annual and semi-annual reports to shareholders (“Audit Fees”) were $56,350 and $65,900 for the fiscal years ended June 30, 2016 and June 30, 2015, respectively.
(b) | Audit-Related Fees |
There were no fees billed by Deloitte to the Fund in its two recent fiscal years for services rendered for assurance and related services that are reasonably related to the performance of the audit or review of the Fund’s financial statements, but are not reported as Audit Fees (“Audit-Related Fees”).
For the Fund’s two most recent fiscal years, there were no Audit-Related Fees billed by Deloitte for engagements related directly to the operations and financial reporting of one or more Funds by a Fund Service Provider. A Fund Service Provider is (a) any investment adviser to the Fund (not including any Subadvisor whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser) or (b) any entity that provides ongoing services to the Fund and is controlling, controlled by or under common control with a Fund investment adviser described in (a).
(c) | Tax Fees |
For the fiscal years ended June 30, 2016 and June 30, 2015, Deloitte billed the Registrant aggregate fees of $9,400 and $8,200, respectively. Each bill is for professional services rendered for tax compliance, tax advice and tax planning. The nature of the services comprising the Tax Fees was the review of the Registrant’s income tax returns and tax distribution requirements.
For the Fund’s two most recent fiscal years, Tax Fees billed by Deloitte for engagements by Fund Service Providers that related directly to the operations and financial reporting of the Funds were $0 for fiscal 2016 and $0 for fiscal 2015, respectively.
The services for which Tax Fees were charged comprise all services performed by professional staff in Deloitte’s tax division except those services related to the audit. Typically, this category would include fees for tax compliance, tax planning, and tax advice. Tax compliance, tax advice, and tax planning services include preparation of original and amended tax returns, claims for refund and tax payment-planning services, assistance with tax audits and appeals, tax advice related to mergers and acquisitions and requests for rulings or technical advice from taxing authorities.
(d) | All Other Fees |
There were no other fees billed by Deloitte to the Fund for all other non-audit services (“Other Fees”) for the fiscal years ended June 30, 2016 and June 30, 2015. During the same period, there were no Other Fees billed by Deloitte for engagements by Fund Service Providers that related directly to the operations and financial reporting of the Fund.
(e) (1) According to policies adopted by the Audit Committee, services provided by Deloitte to the Funds must be pre-approved by the Audit Committee. On an annual basis, the Audit Committee reviews and pre-approves various types of services that Deloitte may perform for the Funds without specific approval of each engagement, subject to specified budget limitations. As contemplated by the Sarbanes-Oxley Act of 2002 and related SEC rules, the Audit Committee also pre-approves non-audit services provided by Deloitte to any Fund Service Provider for any engagement that relates directly to the operations and financial reporting of the Funds. Any engagement that is not already pre-approved or that will exceed a pre-approved budget must be submitted to the Audit Committee for pre-approval.
(e) (2) None.
(f) Not applicable.
(g) The aggregate fees billed by Deloitte in 2016 and 2015 for non-audit services rendered to the Fund and Fund Service Providers were $267,958 and $274,558, respectively. For the fiscal year ended June 30, 2016, this amount reflects the amounts disclosed above in Item 4(b),(c),(d), plus $258,158 in fees billed by the Fund Service Providers for non-audit services that did not relate directly to the operations and financial reporting of the Fund. For the fiscal year ended June 30, 2015, this amount reflects the amounts disclosed above in Item 4(b),(c),(d), plus $258,158 in fees billed by the Fund Service Providers for non-audit services that did not relate directly to the operations and financial reporting of the Fund.
Additionally, SSAE 16 Review (Formerly, SAS No. 70) fees for the current and previous fiscal years of $258,158 and $258,158, respectively, were billed by Deloitte to the Investment Adviser.
(h) The Fund’s Audit Committee has considered whether the provision of non-audit services by registrant’s independent registered public accounting firm to the registrant’s investment advisor, and any entity controlling,
controlled, or under common control with the investment advisor that provided ongoing services to the registrant that were not pre-approved by the Committee (because such services did not relate directly to the operations and financial reporting of the registrant) was compatible with maintaining the independence of the independent registered public accounting firm.
Item 5. Audit Committee of Listed Registrants.
The Registrant has a separately-designated standing Audit Committee established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934. The Registrant’s Audit Committee members include Stuart A. McFarland, Edward A. Kuczmarski, Louis P. Salvatore and Heather S. Goldman.
Item 6. Schedule of Investments.
Schedule of Investments is included as part of the report to stockholders filed under Item 1 of this Form.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
BROOKFIELD INVESTMENT MANAGEMENT INC.
PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES
May 2012
The Portfolio Proxy Voting Policies and Procedures (the “Policies and Procedures”) set forth the proxy voting policies, procedures and guidelines to be followed by Brookfield Investment Management Inc. and its subsidiaries and affiliates (collectively, “BIM”) in voting portfolio proxies relating to securities that are held in the portfolios of the investment companies or other clients (“Clients”) for which BIM has been delegated such proxy voting authority.
A. Proxy Voting Committee
BIM’s internal proxy voting committee (the “Committee”) is responsible for overseeing the proxy voting process and ensuring that BIM meets its regulatory and corporate governance obligations in voting of portfolio proxies.
The Committee shall oversee the proxy voting agent’s compliance with these Policies and Procedures, including any deviations by the proxy voting agent from the proxy voting guidelines (“Guidelines”).
B. Administration and Voting of Portfolio Proxies
1. Fiduciary Duty and Objective
As an investment adviser that has been granted the authority to vote on portfolio proxies, BIM owes a fiduciary duty to its Clients to monitor corporate events and to vote portfolio proxies consistent with the best interests of its Clients. In this regard, BIM seeks to ensure that all votes are free from unwarranted and inappropriate influences. Accordingly, BIM generally votes portfolio proxies in a uniform manner for its Clients and in accordance with these Policies and Procedures and the Guidelines.
In meeting its fiduciary duty, BIM generally view proxy voting as a way to enhance the value of the company’s stock held by the Clients. Similarly, when voting on matters for which the Guidelines dictate a vote be decided on a case-by-case basis, BIM’s primary consideration is the economic interests its Clients.
2. Proxy Voting Agent
BIM may retain an independent third party proxy voting agent to assist BIM in its proxy voting responsibilities in accordance with these Policies and Procedures and in particular, with the Guidelines. As discussed above, the Committee is responsible for monitoring the proxy voting agent.
In general, BIM may consider the proxy voting agent’s research and analysis as part of BIM’s own review of a proxy proposal in which the Guidelines recommend that the vote be considered on a case-by-case basis. BIM bears ultimate responsibility for how portfolio proxies are voted. Unless instructed otherwise by BIM, the proxy voting agent, when retained, will vote each portfolio proxy in accordance with the Guidelines. The proxy voting agent also will assist BIM in maintaining records of BIM’s portfolio proxy votes, including the appropriate records necessary for registered investment companies to meet their regulatory obligations regarding the annual filing of proxy voting records on Form N-PX with the Securities and Exchange Commission (“SEC”).
3. Material Conflicts of Interest
BIM votes portfolio proxies without regard to any other business relationship between BIM and the company to which the portfolio proxy relates. To this end, BIM must identify material conflicts of interest that may arise between a Client and BIM, such as the following relationships:
● | BIM provides significant investment advisory or other services to a portfolio company or its affiliates (the “Company”) whose management is soliciting proxies or BIM is seeking to provide such services; |
● | BIM serves as an investment adviser to the pension or other investment account of the Company or BIM is seeking to serve in that capacity; or |
● | BIM and the Company have a lending or other financial-related relationship. |
In each of these situations, voting against the Company management’s recommendation may cause BIM a loss of revenue or other benefit.
BIM generally seeks to avoid such material conflicts of interest by maintaining separate investment decision-making and proxy voting decision-making processes. To further minimize possible conflicts of interest, BIM and the Committee employ the following procedures, as long as BIM determines that the course of action is consistent with the best interests of the Clients:
● | If the proposal that gives rise to a material conflict is specifically addressed in the Guidelines, BIM will vote the portfolio proxy in accordance with the Guidelines, provided that the Guidelines do not provide discretion to BIM on how to vote on the matter (i.e., case-by-case); or |
● | If the previous procedure does not provide an appropriate voting recommendation, BIM may retain an independent fiduciary for advice on how to vote the proposal or the Committee may direct BIM to abstain from voting because voting on the particular proposal is impracticable and/or is outweighed by the cost of voting. |
4. Certain Foreign Securities
Portfolio proxies relating to foreign securities held by Clients are subject to these Policies and Procedures. In certain foreign jurisdictions, however, the voting of portfolio proxies can result in additional restrictions that have an economic impact to the security, such as “share-blocking.” If BIM votes on the portfolio proxy, share-blocking may prevent BIM from selling the shares of the foreign security for a period of time. In determining whether to vote portfolio proxies subject to such restrictions, BIM, in consultation with the Committee, considers whether the vote, either in itself or together with the votes of other shareholders, is expected to affect the value of the security that outweighs the cost of voting. If BIM votes on a portfolio proxy and during the “share-blocking period,” BIM would like to sell the affected foreign security, BIM, in consultation with the Committee, will attempt to recall the shares (as allowable within the market time-frame and practices).
C. Fund Board Reporting and Recordkeeping
BIM will prepare periodic reports for submission to the Boards of Directors of its affiliated funds (the “Funds”) describing:
● | any issues arising under these Policies and Procedures since the last report to the Funds’ Boards of Directors/Trustees and the resolution of such issues, including but not limited to, information about conflicts of interest not addressed in the Policies and Procedures; and |
● | any proxy votes taken by BIM on behalf of the Funds since the last report to such Funds’ Boards of Directors/Trustees that deviated from these Policies and Procedures, with reasons for any such deviations. |
In addition, no less frequently than annually, BIM will provide the Boards of Directors/Trustees of the Funds with a written report of any recommended changes based upon BIM’s experience under these Policies and Procedures, evolving industry practices and developments in the applicable laws or regulations.
BIM will maintain all records that are required under, and in accordance with, all applicable regulations, including the Investment Company Act of 1940, as amended, and the Investment Advisers Act of 1940, which include, but not limited to:
● | these Policies and Procedures, as amended from time to time; |
● | records of votes cast with respect to portfolio proxies, reflecting the information required to be included in Form N-PX, as applicable; |
● | records of written client requests for proxy voting information and any written responses of BIM to such requests; and |
● | any written materials prepared by BIM that were material to making a decision in how to vote, or that memorialized the basis for the decision. |
D. Amendments to these Procedures
The Committee shall periodically review and update these Policies and Procedures as necessary. Any amendments to these Procedures and Policies (including the Guidelines) shall be provided to the Board of Directors of BIM and to the Boards of Directors of the Funds for review and approval.
E. Proxy Voting Guidelines
Guidelines are available upon request.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Investment Team – Portfolio Managers
Ms. Michelle Russell-Dowe – Managing Director, Head of Securitized Products Investment Team
Ms. Russell-Dowe is the lead Portfolio Manager and Head of the Securitized Products Investment Team. She is responsible for the firm’s securitized credit strategies and exposures. Ms. Russell-Dowe has personally built her investment team, which averages 13 years of industry experience. Ms. Russell-Dowe has 20 years of investment experience in securitized products, including 16 years with the firm, which she joined in 1999 from Duff & Phelps. She earned a Bachelor of Arts degree in Economics from Princeton University and holds an MBA from the Graduate School of Business at Columbia University, where she graduated as valedictorian.
Jeffrey Williams, CFA – Managing Director
Mr. Williams is a Portfolio Manager on the Securitized Products Investment team. Mr. Williams maintains responsibility for portfolio management for the firm’s securitized product strategies, with a particular focus on CMBS and related assets. Mr. Williams has 26 years of experience as a commercial real estate portfolio manager, specializing in subordinate CMBS, investment grade CMBS, mezzanine loans, B-Notes, CDOs, derivatives and REITs. Mr. Williams holds the Chartered Financial Analyst designation and has an MBA from Georgia State University and a BA in Finance from the University of South Florida.
Anthony A. Breaks, CFA – Managing Director
Mr. Breaks is a Portfolio Manager on the Securitized Products Investments team. Mr. Breaks is a team leader in
MBS/ABS and is a member of the team’s securities analysis committee. Mr. Breaks has experience in managing securitized product vehicles, such as SIV, ABCP, CDOs, CLOs and TRUPPS as well as insurance company asset management experience. Mr. Breaks earned a Bachelor of Science degree in Electrical Engineering from the Massachusetts Institute of Technology. He holds the Chartered Financial Analyst designation.
Ms. Russell-Dowe leads the management of the Fund and Messrs. Williams and Breaks share equally the day-to-day portfolio management responsibilities.
Management of Other Accounts
Ms. Russell-Dowe manages other investment companies and/or investment vehicles and accounts in addition to the Registrant. The tables below show the number of other accounts managed by Ms. Russell-Dowe as of July 31, 2016 and the total assets in each of the following categories: (a) registered investment companies; (b) other pooled investment vehicles; and (c) other accounts. For each category, the table also shows the number of accounts and the total assets in the accounts with respect to which the advisory fee is based on account performance.
| Registered Investment Companies
|
|
| Other Pooled Investment Vehicles
|
| Other Accounts | ||||||
Number of Accounts Managed | 4 | 8 | 12 | |||||||||
Number of Accounts Managed with Performance- Based Advisory Fees | 0 | 1 | 1 | |||||||||
Assets Managed | $1,167 million | $1,013 million | $2,597 million | |||||||||
Assets Managed with Performance-Based Advisory Fees | $0 | $29 million | $792 million | |||||||||
The following table provides information about the accounts managed by Jeffrey Williams, Co-Portfolio Manager for the Registrant, as of July 31, 2016:
| Registered Investment Companies
|
|
| Other Pooled Investment Vehicles
|
| Other Accounts | ||||||
Number of Accounts Managed | 4 | 8 | 12 | |||||||||
Number of Accounts Managed with Performance- Based Advisory Fees | 0 | 1 | 1 | |||||||||
Assets Managed | $ | 1,167 million | $ | 1,013 million | $2,597 million | |||||||
Assets Managed with Performance-Based Advisory Fees | $ | 0 | $ | 29 million | $792 million | |||||||
The following table provides information about the accounts managed by Anthony A. Breaks, Co-Portfolio Manager for the Registrant, as of July 31, 2016:
| Registered Investment Companies
|
|
| Other Pooled Investment Vehicles
|
| Other Accounts | ||||||
Number of Accounts Managed | 4 | 8 | 12 | |||||||||
Number of Accounts Managed with Performance- Based Advisory Fees | 0 | 1 | 1 | |||||||||
Assets Managed | $1,167 million | $1,013 million | $2,597 million | |||||||||
Assets Managed with Performance-Based Advisory Fees | $0 | $29 million | $792 million | |||||||||
Share Ownership
The following table indicates the dollar range of securities of the Registrant owned by the Registrant’s portfolio managers as July 31, 2016.
Dollar Range of Securities Owned | ||
Michelle Russell-Dowe Jeffrey Williams Anthony A. Breaks | Over $100,000 $10,001 – $50,000. $0 |
Portfolio Manager Material Conflict of Interest
Potential conflicts of interest may arise when a fund’s portfolio manager has day-to-day management responsibilities with respect to one or more other funds or other accounts, as is the case for the portfolio managers of the Registrant.
These potential conflicts include:
Allocation of Limited Time and Attention. A portfolio manager who is responsible for managing multiple funds and/or accounts may devote unequal time and attention to the management of those funds and/or accounts. As a result, the portfolio manager may not be able to formulate as complete a strategy or identify equally attractive investment opportunities for each of those accounts as the case may be if he or she were to devote substantially more attention to the management of a single fund. The effects of this potential conflict may be more pronounced where funds and/or accounts overseen by a particular portfolio manager have different investment strategies.
Allocation of Limited Investment Opportunities. If a portfolio manager identifies a limited investment
opportunity that may be suitable for multiple funds and/or accounts, the opportunity may be allocated among these several funds or accounts, which may limit a fund’s ability to take full advantage of the investment opportunity.
Pursuit of Differing Strategies. At times, a portfolio manager may determine that an investment opportunity may be appropriate for only some of the funds and/or accounts for which he or she exercises investment responsibility, or may decide that certain of the funds and/or accounts should take differing positions with respect to a particular security. In these cases, the portfolio manager may place separate transactions for one or more funds or accounts which may affect the market price of the security or the execution of the transaction, or both, to the detriment or benefit of one or more other funds and/or accounts.
Variation in Compensation. A conflict of interest may arise where the financial or other benefits available to the portfolio manager differ among the funds and/or accounts that he or she manages. If the structure of the investment adviser’s management fee and/or the portfolio manager’s compensation differs among funds and/or accounts (such as where certain funds or accounts pay higher management fees or performance-based management fees), the portfolio manager might be motivated to help certain funds and/or accounts over others. The portfolio manager might be motivated to favor funds and/or accounts in which he or she has an interest or in which the investment adviser and/or its affiliates have interests. Similarly, the desire to maintain or raise assets under management or to enhance the portfolio manager’s performance record or to derive other rewards, financial or otherwise, could influence the portfolio manager to lend preferential treatment to those funds and/or accounts that could most significantly benefit the portfolio manager.
Related Business Opportunities. The investment adviser or its affiliates may provide more services (such as distribution or recordkeeping) for some types of funds or accounts than for others. In such cases, a portfolio manager may benefit, either directly or indirectly, by devoting disproportionate attention to the management of fund and/or accounts that provide greater overall returns to the investment manager and its affiliates.
The Adviser and the Registrants have adopted compliance policies and procedures that are designed to address the various conflicts of interest that may arise for the Adviser and the individuals that it employs. For example, the Adviser seeks to minimize the effects of competing interests for the time and attention of portfolio managers by assigning portfolio managers to manage funds and accounts that share a similar investment style. The Adviser has also adopted trade allocation procedures that are designed to facilitate the fair allocation of limited investment opportunities among multiple funds and accounts. There is, however, no guarantee that such policies and procedures will be able to detect and prevent every situation in which an actual or potential conflict may appear.
Portfolio Manager Compensation
The Registrant’s portfolio manager is compensated by the Adviser. The compensation structure of the Adviser’s portfolio managers and other investment professionals has three primary components: (1) a base salary, (2) an annual cash bonus, and (3) if applicable, long-term stock-based compensation consisting generally of restricted stock units of the Adviser’s indirect parent company, Brookfield Asset Management, Inc. The portfolio managers also receive certain retirement, insurance and other benefits that are broadly available to all of the Adviser’s employees. Compensation of the portfolio managers is reviewed on an annual basis by senior management.
The Adviser compensates its portfolio managers based primarily on the scale and complexity of their portfolio responsibilities, the total return performance of funds and accounts managed by the portfolio manager on an absolute basis and versus appropriate peer groups of similar size and strategy, as well as the management skills
displayed in managing their subordinates and the teamwork displayed in working with other members of the firm. Since the portfolio managers are responsible for multiple funds and accounts, investment performance is evaluated on an aggregate basis almost equally weighted among performance, management and teamwork. Base compensation for the Adviser’s portfolio managers varies in line with the portfolio manager’s seniority and position. The compensation of portfolio managers with other job responsibilities (such as acting as an executive officer of the Adviser and supervising various departments) will include consideration of the scope of such responsibilities and the portfolio manager’s performance in meeting them. The Adviser seeks to compensate portfolio managers commensurate with their responsibilities and performance, and competitive with other firms within the investment management industry. Salaries, bonuses and stock-based compensation are also influenced by the operating performance of the Adviser and its indirect parent. While the salaries of the Adviser’s portfolio managers are comparatively fixed, cash bonuses and stock-based compensation may fluctuate significantly from year to year, based on changes in the portfolio manager’s performance and other factors as described herein.
Item 9. | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. |
None.
Item 10. Submission of Matters to a Vote of Security Holders.
The registrant’s nominating committee charter does not contain any procedure by which shareholders may recommend nominees to the registrant’s board of directors.
Item 11. Controls and Procedures.
(a) The Registrant’s principal executive officer and principal financial officer have concluded that the Registrant’s Disclosure Controls and Procedures are effective, based on their evaluation of such Disclosure Controls and Procedures as of a date within 90 days of the filing of this report on Form N-CSR.
(b) As of the date of filing this Form N-CSR, the Registrant’s principal executive officer and principal financial officer are aware of no changes in the Registrant’s internal control over financial reporting that occurred during the Registrant’s second 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.
Item 12. Exhibits.
(a)(1) None.
(2) A separate certification for each principal executive officer and principal financial officer of the Registrant as required by Rule 30a-2(a) under the Investment Company Act of 1940 is attached as an exhibit to this Form N-CSR.
(3) None.
(b) A separate certification for each principal executive officer and principal financial officer of the Registrant as required by Rule 30a-2(b) under the Investment Company Act of 1940 is attached as an exhibit to this Form N-CSR.
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.
BROOKFIELD MORTGAGE OPPORTUNITY INCOME FUND INC.
By: | /s/ Brian F. Hurley | |
Brian F. Hurley President and Principal Executive Officer |
Date: August 25, 2016
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/ Brian F. Hurley | |
Brian F. Hurley President and Principal Executive Officer |
Date: August 25, 2016
By: | /s/ Angela W. Ghantous | |
Angela W. Ghantous Treasurer and Principal Financial Officer |
Date: August 25, 2016