N-30D 1 dn30d.txt "PIMS" ANNUAL REPORTS PERIOD ENDING 03/31/2001 PIMCO FUNDS [GRAPHIC] PACIFIC INVESTMENT MANAGEMENT SERIES ANNUAL REPORT MARCH 31, 2001 FOMC Federal Funds Rate Change [GRAPH] Federal Open Market Committee federal funds Rate Changes Fed Funds Date Target Rate ======================================================== Start 3.00 4-Feb-94 3.25 22-Mar-94 3.50 18-Apr-94 3.75 17-May-94 4.25 6-Jul-94 4.25 16-Aug-94 4.75 27-Sep-94 4.75 15-Nov-94 5.50 20-Dec-94 5.50 1-Feb-95 6.00 28-Mar-95 6.00 23-May-95 6.00 6-Jul-95 5.75 22-Aug-95 5.75 26-Sep-95 5.75 15-Nov-95 5.75 19-Dec-95 5.50 31-Jan-96 5.25 26-Mar-96 5.25 21-May-96 5.25 3-Jul-96 5.25 20-Aug-96 5.25 24-Sep-96 5.25 13-Nov-96 5.25 17-Dec-96 5.25 5-Feb-97 5.25 25-Mar-97 5.50 20-May-97 5.50 2-Jul-97 5.50 19-Aug-97 5.50 30-Sep-97 5.50 12-Nov-97 5.50 16-Dec-97 5.50 4-Feb-98 5.50 31-Mar-98 5.50 19-May-98 5.50 30-Jun-98 5.50 18-Aug-98 5.50 29-Sep-98 5.25 15-Oct-98 5.00 17-Nov-98 4.75 22-Dec-98 4.75 3-Feb-99 4.75 30-Mar-99 4.75 18-May-99 4.75 30-Jun-99 5.00 24-Aug-99 5.25 5-Oct-99 5.25 16-Nov-99 5.50 21-Dec-99 5.50 2-Feb-00 5.75 21-Mar-00 6.00 16-May-00 6.50 28-Jun-00 6.50 22-Aug-00 6.50 3-Oct-00 6.50 15-Nov-00 6.50 19-Dec-00 6.50 3-Jan-01 6.00 31-Jan-01 5.50 20-Mar-01 5.00 18-Apr-01 4.50 Source: Bloomberg On the cover: Presented on the cover and in greater detail here is a chart depicting the target for the federals fund rates as determined by the U.S. Federal Open Market Committee (FOMC or the Fed) and is reflective of the historical change in monetary policy. The FOMC has eight scheduled meetings per year during which it conducts an assessment of the economy and formulates and evaluates policy options. The graph indicates that the FOMC increased the target rate six times over the period from June 1999 to May 2000, to a high of 6.50%, in an effort to cool an economy that was growing at a record pace. That pace was faster than the central bank believed possible without triggering an increase in inflation. The Fed left rates unchanged during the remainder of 2000 as it became evident that the rate increases were having the desired affect. The sudden decrease in U.S. economic growth during the final quarter of 2000 prompted the FOMC to reduce rates aggressively during the first quarter of 2001 to prevent a slowdown from becoming a recession. Contents Chairman's Message.............................................................1 A Conversation with Bill Gross and Paul McCulley...............................2 Financial Highlights..........................................................32 Statements of Assets and Liabilities..........................................42 Statements of Operations......................................................46 Statements of Changes in Net Assets...........................................50 Statements of Cash Flows......................................................57 Notes to Financial Statements................................................175
Fund Schedule Summary Investments Total Return Fund.................................................................4 58 Total Return Fund II..............................................................5 87 Total Return Fund III.............................................................6 91 Moderate Duration Fund............................................................7 95 Low Duration Fund.................................................................8 99 Low Duration Fund II..............................................................9 107 Low Duration Fund III............................................................10 110 Short-Term Fund..................................................................11 112 Money Market Fund................................................................12 116 Long-Term U.S. Government Fund...................................................13 117 Investment Grade Corporate Bond Fund.............................................14 121 High Yield Fund..................................................................15 123 Total Return Mortgage Fund.......................................................16 129 GNMA Fund........................................................................17 131 Real Return Bond Fund............................................................18 132 Foreign Bond Fund................................................................19 136 Global Bond Fund.................................................................20 142 Global Bond Fund II..............................................................21 148 Emerging Markets Bond Fund.......................................................22 154 Strategic Balanced Fund..........................................................23 156 Convertible Fund.................................................................24 157 European Convertible Fund........................................................25 159 StocksPLUS Fund..................................................................26 160 Municipal Bond Fund..............................................................27 164 Short Duration Municipal Income Fund.............................................28 167 California Intermediate Municipal Bond Fund......................................29 169 California Municipal Bond Fund...................................................30 172 New York Municipal Bond Fund.....................................................31 174
Chairman's Letter Dear PIMCO Funds Shareholder: We are pleased to present you with this annual report for PIMCO Funds: Pacific Investment Management Series. During the Trust's fiscal year, assets grew by $17.9 billion to finish the 12-month period ended March 31, 2001 at $68.8 billion. Strongly positive returns from fixed income securities helped anchor diversified portfolios during a year in which many major global stock markets finished in negative territory. The Lehman Brothers Aggregate Bond Index, generally regarded as representative of the bond market as a whole, increased 12.53% over the fiscal year. Stocks retreated as the correction in the technology sector that began during 2000 spread to other industries. Investors looking for safety pushed Treasury yields lower during the latter part of the fiscal year, with short and intermediate maturities falling the most. The 3-month Treasury yield decreased 1.58% over the course of the year to finish at 4.28%. The 2- to 30-year portion of the yield curve steepened sharply as the 2-year yield dropped 2.30% while the 30-year yield dropped slightly by 0.38%. The 10-year yield fell 1.09% to close at 4.92%. The Fed left the fed funds rate unchanged during the second half of 2000 after last increasing the rate 0.50% to 6.50% in May 2000, the last of six rate hikes since June 1999. The central bank shifted emphasis away from inflation at its December meeting and set the stage for an easing cycle. U.S. growth slowed to 1.0% in the final quarter of 2000, the weakest pace in more than five years. This sudden deceleration prompted two 0.50% fed funds rate cuts by the Fed in January to prevent a slowdown from turning into a recession. Signs of economic weakness continued to mount, however, including a relentless procession of profit warnings from companies in a diverse range of industries. On March 20, the Fed reduced the fed funds rate an additional 0.50% and suggested that more easing could soon be on the way. The central bank stated in its accompanying press release that it "will need to monitor events closely" as "the economic situation could be evolving rapidly." Consumer confidence revived late in the quarter as employment levels remained relatively high. Even so, pessimists who thought the Fed should have acted more aggressively at its March meeting could point to retrenchment in business investment as a sign that the economy would continue to weaken. We are pleased to announce the addition of the European Convertible Fund, which began operations in November 2000. In addition, the Investment Grade Corporate Bond and California Municipal Bond Funds were launched in April and May 2000, respectively, in an effort to further compliment our product offering and broaden the range of investment options available to investors. On the following pages you will find commentary from PIMCO's Bill Gross and Paul McCulley, plus specific details as to each Fund's portfolio and total return investment performance including a discussion of those factors that affected investment performance. We appreciate the trust you have placed in us through your investments, and we will continue to focus our efforts to meet your investment needs. If you have any questions regarding your PIMCO Funds investment, please contact your account manager, or call one of our shareholder associates at 1-800-927-4648. We also invite you to visit our Web site at www.pimco.com. Sincerely, /s/ Brent R. Harris Brent R. Harris Chairman of the Board April 30, 2001 3.31.01 | PIMCO Funds Annual Report 1 Economic Outlook The Big Picture From PIMCO's Bill Gross and Paul McCulley Widely regarded as America's most influential authority on the bond market, Bill Gross is the portfolio manager of PIMCO Total Return Fund - the country's largest bond fund.* Paul McCulley is an economist, monetary policy specialist, and a managing director of PIMCO. We recently spoke with them about the economy and the financial markets. Q: What's been happening with the economy recently? BG: On a cyclical basis, we're seeing a classic inventory correction and the resulting contraction in the manufacturing and technology sectors. There are also several long-term excesses unraveling simultaneously, in particular the deflating bubbles of consumer spending, investment and borrowing. They were self-reinforcing on the way up, and they're now a vicious cycle on the way down. Combine that with the dramatic rise in layoffs and surging unemployment claims, and the result is falling consumer confidence levels. And in a consumption-driven economy like ours, consumer confidence is vital. Q: Do you see the economy rebounding anytime soon? PM: I think we'll be mired in a recession until late in the year. Things will start to turn around once the current inventory correction runs its course, but a big bounce for the economy after that is unlikely due to restrained consumption. It looks more like we'll have a recovery with GDP growth of perhaps 2 or 3%. Q: Why won't consumer spending snap back? BG: Right now, consumer confidence is on the decline and real personal wealth in the U.S. has plunged along with equity market prices. We're also looking at a negative personal savings rate, stimulated by years of excess consumption beyond the average consumer's means. This combination makes it likely that debt-laden and increasingly anxious consumers will start saving again - reliquifying, if you will - in turn holding back the rate of consumption and the economy relative to the last several years. Q: How is the Fed likely to respond? PM: The Fed has already made several interest rate cuts since the beginning of the year, and we believe it will continue to ease aggressively. We think the Fed funds target rate needs to fall to at least 4%, but the longer the Fed waits to get to that target, the less effective the cuts will be and the deeper they'll have to go. In our view it is imperative for the Fed to reverse the downward trend in confidence at both the business and consumer levels. This would encourage risk capital to return to the financial markets. Q: Is monetary policy alone going to bring a recovery? PM: Slashing interest rates, which fosters new debt creation, certainly can help. But I don't believe that Fed easing alone will be enough to generate a healthy recovery. We also need new fiscal policy in the form of an aggressive tax cut to transfer the government's surplus back into the private sector. Tax cuts put money in consumers' pockets and should alleviate some of the pressure they're feeling today. I also think the tax cut we need now should be aimed at the "average" American wage earner. It should be retroactive, and the bulk of it should go into effect in the near term. Q: What's going on overseas? PM: We expect global growth to continue to decelerate. The slowdown in Europe will be less severe than in the U.S., since consumer confidence should hold up and real incomes will get a boost from tax reductions. Inflation is contained, which gives the European Central Bank room to ease. We remain fairly negative on Japan. Its economy should continue to weaken. Consumer confidence remains low despite huge fiscal stimulus packages that have swelled public debt, while still more public spending will be needed to support Japan's ailing banks. Meanwhile, the government is taking a "go-slow" approach to fixing the banking system, which isn't helping matters. 2 PIMCO Funds Annual Report | 3.31.01 Since the personal savings rate in the U.S. is so low, it means the economy isn't likely to get a boost from consumers anytime soon Personal Savings as a percentage of disposable income. [GRAPH] PIMCO Funds: Pacific Investment Management Series Annual Report dated March 31, 2001 The line graph inserted at the top of page 3 in the section "Economic Outlook" is entitled "Personal Savings as a percentage of disposable income" and illustrates the fact that personal savings are declining. The graph shows one line representing the 3-month moving average (%) of personal savings over the period from mid-1987 through mid-2000. Source: Goldman Sachs Q: Where do you see value in the bond market today? BG: We'll continue to focus on higher-quality, longer duration investments. Most of our higher-quality exposure will come from mortgage-backed securities, as the Treasury market has fully priced in the effects of further Fed easing. Where possible, we intend to keep duration above- benchmark as current monetary policy effectively caps long-term interest rates. While we remain defensive in high yield, we may look to take advantage of select opportunities in the corporate sector as signs of a recovery emerge. In the current environment, core European bonds offer compelling value because the yields offered don't fully price in the anticipated slowdown in the region. Yields on the short-end are particularly attractive because of anticipated easing by the European Central Bank. Although our long position on the Euro has not been positive, we think it will gain in value given the current weakness in the U.S. Q: Finally, Bill, what about the long-term prospects for the financial markets? BG: I think we're at an important juncture in the economy that's pointing toward lower corporate profits and a swing back to long-run historical return averages for the financial markets over the next several years. That means something along the lines of 6-7% returns for bonds and 8-9% for stocks. In terms of structural influences on the economy, "New Age" technology and globalization trends have accelerated competition - a positive development for the consumer due to lower inflation but a negative one for U.S. corporate profit margins. You also have to consider the reverse-wealth effect I alluded to earlier. Greater savings mean less overall consumption and less economic activity, so the days of 5-6% GDP growth are likely to turn into 2-3% this decade, which will keep the financial markets from growing at the pace we've seen over the past several years. There's also a demographic shift underway, with the boomer generation beginning to move out of stocks and into fixed income. This marginal decline in demand won't help equity prices and, with relatively low interest rates holding sway, total returns for fixed income are also limited. In short, we're entering an era of diminished expectations, and investors would be wise to plan for their long-term financial needs with this reality in mind. Each month, Bill Gross and Paul McCulley offer their insights on the economy and the markets. Be sure to check out their newsletters, Investment Outlook and Fed Focus, online at www.pimco.com. * Source: net assets by Simfund Past performance is no guarantee of future results. The views of Mr. Gross and Mr. McCulley are not indicative of the past or future performance of any PIMCO Funds. The chart is not indicative of the past or future performance of any PIMCO Fund. There is no guarantee that these or any other investment techniques will be effective under all market conditions. Please see the prospectus for more complete information on the PIMCO Total Return Fund. 3.31.01 | PIMCO Funds Annual Report 3 PIMCO Total Return Fund FUND CHARACTERISTICS Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily intermediate maturity fixed income securities Duration: 5.6 years Total Net Assets: $42.5 billion Sector Breakdown:* [GRAPH] Mortgage-Backed Securities 50.8% Corporate Bonds & Notes 23.1% U.S. Treasury Obligations 8.9% Short-Term Instruments 7.7% Other 9.5% Quality Breakdown:* [GRAPH] AAA 73.5% AA 4.1% A 14.3% BBB 6.9% BB 1.2% *% of Total Investments as of March 31, 2001 PERFORMANCE TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Lipper Intermediate Inst'l Class Admin. Class Lehman Brothers Investment Grade (Incep. 5/11/1987) (Incep. 9/07/1994) Aggregate Bond Index Debt Fund Average ----------------------------------------------------------------------------------------------------------- 1 Year 12.80% 12.52% 12.53% 11.21% 3 Years* 7.49% 7.22% 6.88% 5.86% 5 Years* 8.32% 8.05% 7.48% 6.61% 10 Years* 9.12% -- 7.98% 7.57% Since Inception* 9.31% 8.38% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] TOTAL RETURN FUND Total Return Lehman Brothers MONTH Fund Aggregate Bond Index -------------------------------------------------------------------------------- 05/31/1987 5,000,000 5,000,000 06/30/1987 5,063,956 5,068,813 07/31/1987 5,051,390 5,064,918 08/31/1987 5,039,534 5,037,815 09/30/1987 4,913,547 4,930,538 10/31/1987 5,070,060 5,106,141 11/30/1987 5,107,024 5,147,040 12/31/1987 5,153,726 5,217,151 01/31/1988 5,364,621 5,400,545 02/29/1988 5,425,978 5,464,652 03/31/1988 5,377,483 5,413,367 04/30/1988 5,349,895 5,384,153 05/31/1988 5,323,746 5,347,962 06/30/1988 5,451,097 5,476,986 07/31/1988 5,444,079 5,448,260 08/31/1988 5,470,463 5,462,542 09/30/1988 5,574,381 5,586,211 10/31/1988 5,662,479 5,691,379 11/30/1988 5,612,027 5,622,241 12/31/1988 5,637,131 5,628,571 01/31/1989 5,706,918 5,709,556 02/28/1989 5,670,892 5,668,171 03/31/1989 5,697,790 5,692,677 04/30/1989 5,825,551 5,811,802 05/31/1989 5,967,305 5,964,522 06/30/1989 6,168,244 6,146,131 07/31/1989 6,298,843 6,276,779 08/31/1989 6,190,418 6,183,783 09/30/1989 6,221,536 6,215,431 10/31/1989 6,371,017 6,368,476 11/30/1989 6,426,949 6,429,174 12/31/1989 6,440,083 6,446,378 01/31/1990 6,332,594 6,369,774 02/28/1990 6,349,652 6,390,386 03/31/1990 6,344,778 6,395,092 04/30/1990 6,255,058 6,336,504 05/31/1990 6,460,283 6,524,117 06/30/1990 6,569,705 6,628,798 07/31/1990 6,676,661 6,720,495 08/31/1990 6,571,662 6,630,745 09/30/1990 6,578,458 6,685,601 10/31/1990 6,669,789 6,770,482 11/30/1990 6,838,024 6,916,223 12/31/1990 6,958,354 7,023,987 01/31/1991 7,027,903 7,110,815 02/28/1991 7,126,178 7,171,514 03/31/1991 7,216,808 7,220,852 04/30/1991 7,335,070 7,299,078 05/31/1991 7,390,178 7,341,762 06/30/1991 7,401,768 7,338,029 07/31/1991 7,508,521 7,439,788 08/31/1991 7,712,232 7,600,786 09/30/1991 7,894,694 7,754,804 10/31/1991 7,975,769 7,841,145 11/30/1991 8,045,044 7,913,042 12/31/1991 8,319,147 8,148,046 01/31/1992 8,251,437 8,037,198 02/29/1992 8,323,957 8,089,457 03/31/1992 8,292,135 8,043,852 04/30/1992 8,335,850 8,101,954 05/31/1992 8,508,487 8,254,836 06/30/1992 8,616,472 8,368,443 07/31/1992 8,827,524 8,539,178 08/31/1992 8,902,987 8,625,682 09/30/1992 9,043,980 8,727,928 10/31/1992 8,965,037 8,612,211 11/30/1992 8,972,362 8,614,159 12/31/1992 9,129,278 8,751,136 01/31/1993 9,297,750 8,918,950 02/28/1993 9,504,901 9,075,078 03/31/1993 9,560,206 9,112,893 04/30/1993 9,643,848 9,176,350 05/31/1993 9,666,306 9,188,036 06/30/1993 9,876,645 9,354,551 07/31/1993 9,937,133 9,407,459 08/31/1993 10,163,538 9,572,351 09/30/1993 10,204,890 9,598,643 10/31/1993 10,277,472 9,634,511 11/30/1993 10,187,745 9,552,551 12/31/1993 10,271,501 9,604,324 01/31/1994 10,396,445 9,733,998 02/28/1994 10,210,928 9,564,886 03/31/1994 9,995,399 9,329,070 04/30/1994 9,896,929 9,254,577 05/31/1994 9,850,224 9,253,278 06/30/1994 9,814,015 9,232,829 07/31/1994 10,015,509 9,416,223 08/31/1994 10,044,623 9,427,908 09/30/1994 9,917,753 9,289,146 10/31/1994 9,906,083 9,280,869 11/30/1994 9,907,443 9,260,257 12/31/1994 9,904,417 9,324,202 01/31/1995 10,082,267 9,508,731 02/28/1995 10,319,048 9,734,809 03/31/1995 10,417,456 9,794,534 04/30/1995 10,600,658 9,931,349 05/31/1995 10,936,213 10,315,665 06/30/1995 10,929,713 10,391,294 07/31/1995 10,936,311 10,368,086 08/31/1995 11,105,123 10,493,216 09/30/1995 11,244,355 10,595,300 10/31/1995 11,415,091 10,733,089 11/30/1995 11,662,396 10,893,924 12/31/1995 11,863,138 11,046,806 01/31/1996 11,960,385 11,120,164 02/29/1996 11,668,778 10,926,870 03/31/1996 11,578,391 10,850,915 04/30/1996 11,530,294 10,789,892 05/31/1996 11,499,480 10,767,982 06/30/1996 11,683,873 10,912,588 07/31/1996 11,714,500 10,942,450 08/31/1996 11,704,501 10,924,111 09/30/1996 11,973,193 11,114,483 10/31/1996 12,284,300 11,360,686 11/30/1996 12,575,406 11,555,278 12/31/1996 12,419,446 11,447,838 01/31/1997 12,465,678 11,482,894 02/28/1997 12,494,013 11,511,458 03/31/1997 12,342,925 11,383,894 04/30/1997 12,565,728 11,554,304 05/31/1997 12,694,757 11,663,529 06/30/1997 12,843,894 11,801,967 07/31/1997 13,203,071 12,120,229 08/31/1997 13,089,168 12,016,846 09/30/1997 13,301,627 12,194,073 10/31/1997 13,461,510 12,370,975 11/30/1997 13,523,400 12,427,941 12/31/1997 13,681,812 12,553,071 01/31/1998 13,893,968 12,714,230 02/28/1998 13,855,371 12,704,087 03/31/1998 13,902,211 12,748,312 04/30/1998 13,957,191 12,814,853 05/31/1998 14,119,833 12,936,413 06/30/1998 14,257,594 13,046,124 07/31/1998 14,305,551 13,073,877 08/31/1998 14,533,176 13,286,646 09/30/1998 14,969,015 13,597,767 10/31/1998 14,869,808 13,525,870 11/30/1998 14,925,950 13,602,636 12/31/1998 15,018,914 13,643,534 01/31/1999 15,109,171 13,740,911 02/28/1999 14,831,091 13,501,039 03/31/1999 14,958,503 13,575,857 04/30/1999 15,032,946 13,618,865 05/31/1999 14,870,656 13,499,578 06/30/1999 14,846,270 13,456,570 07/31/1999 14,790,750 13,399,279 08/31/1999 14,803,007 13,392,596 09/30/1999 14,968,364 13,547,942 10/31/1999 15,018,938 13,597,929 11/30/1999 15,055,090 13,596,955 12/31/1999 14,976,517 13,531,388 01/31/2000 14,900,278 13,487,081 02/29/2000 15,083,651 13,650,188 03/31/2000 15,307,078 13,830,012 04/30/2000 15,264,806 13,790,412 05/31/2000 15,262,467 13,784,082 06/30/2000 15,586,098 14,070,858 07/31/2000 15,729,678 14,198,585 08/31/2000 15,977,572 14,404,375 09/30/2000 16,034,043 14,494,936 10/31/2000 16,135,944 14,590,853 11/30/2000 16,451,556 14,829,427 12/31/2000 16,786,703 15,104,518 01/31/2001 17,032,309 15,351,532 02/28/2001 17,196,785 15,485,264 03/31/2001 17,266,189 15,563,003 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 6/01/1987, the first full month following the Fund's Institutional Class inception on 5/11/1987, compared to the Lehman Brothers Aggregate Bond Index, an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 9/07/1994. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. PORTFOLIO INSIGHTS . The Total Return Fund's Institutional Class shares outperformed the Lehman Brothers Aggregate Bond Index for the one-year period ended March 31, 2001, returning 12.80% versus 12.53% for the Index. . The Fund's duration was moved above that of the Index in the second half of 2000, which had a positive impact on returns as intermediate rates fell. However, an emphasis on longer term maturities detracted from returns as intermediate maturities outperformed. . An overweight in mortgages added to returns due to relatively high yields and low market volatility in 2000 but was negative in the first quarter of 2001 amid concern about prepayment risk. . An underweight in investment grade corporates helped returns in 2000 on concern about credit quality in this sector in a slowing economy. However, this position was negative in the first quarter of 2001 as corporates recovered. A small high yield allocation was negative in 2000 but added to returns in the first quarter of 2001 when the sector rallied after Fed easing. . Within the international sector, emerging market bonds helped returns as yield premiums cushioned concerns about a global slowdown. Positions based on an expected rise in the euro were negative as the euro lost ground relative to the dollar. 4 PIMCO Funds Annual Report | 3.31.01 PIMCO Total Return Fund II FUND CHARACTERISTICS Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily intermediate maturity fixed income securities with quality and non-U.S. issuer restrictions Duration: 5.7 years Total Net Assets: $1.7 billion Sector Breakdown:* [GRAPH] Mortgage-Backed Securities 51.3% Corporate Bonds & Notes 25.1% U.S. Treasury Obligations 10.5% Short-Term Instruments 7.0% Other 6.1% Quality Breakdown:* [GRAPH] AAA 72.5% AA 6.4% A 17.4% BBB 3.7% *% of Total Investments as of March 31, 2001 PERFORMANCE TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Lipper Intermediate Inst'l Class Admin. Class Lehman Brothers Investment Grade (Incep. 12/30/1991) (Incep. 11/30/1994) Aggregate Bond Index Debt Fund Average --------------------------------------------------------------------------------------------------------------- 1 Year 13.02% 12.74% 12.53% 11.21% 3 Years* 7.21% 6.94% 6.88% 5.86% 5 Years* 7.93% 7.66% 7.48% 6.61% Since Inception * 7.88% 8.58% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] TOTAL RETURN FUND II Total Return Lehman Brothers MONTH Fund II Aggregate Bond Index -------------------------------------------------------------------------------- 12/31/1991 5,000,000 5,000,000 01/31/1992 4,929,716 4,931,979 02/29/1992 4,951,937 4,964,047 03/31/1992 4,937,873 4,936,062 04/30/1992 4,963,257 4,971,716 05/31/1992 5,075,312 5,065,531 06/30/1992 5,149,979 5,135,245 07/31/1992 5,309,040 5,240,016 08/31/1992 5,355,136 5,293,098 09/30/1992 5,437,041 5,355,841 10/31/1992 5,367,337 5,284,832 11/30/1992 5,383,727 5,286,027 12/31/1992 5,471,600 5,370,083 01/31/1993 5,579,371 5,473,060 02/28/1993 5,705,377 5,568,868 03/31/1993 5,719,997 5,592,073 04/30/1993 5,793,075 5,631,013 05/31/1993 5,790,801 5,638,183 06/30/1993 5,920,354 5,740,365 07/31/1993 5,952,711 5,772,831 08/31/1993 6,070,915 5,874,017 09/30/1993 6,093,002 5,890,150 10/31/1993 6,109,820 5,912,160 11/30/1993 6,049,436 5,861,866 12/31/1993 6,067,802 5,893,636 01/31/1994 6,149,761 5,973,210 02/28/1994 6,050,676 5,869,435 03/31/1994 5,910,178 5,724,729 04/30/1994 5,870,870 5,679,016 05/31/1994 5,858,460 5,678,219 06/30/1994 5,845,104 5,665,671 07/31/1994 5,977,463 5,778,209 08/31/1994 5,984,657 5,785,380 09/30/1994 5,896,835 5,700,229 10/31/1994 5,889,838 5,695,150 11/30/1994 5,888,896 5,682,502 12/31/1994 5,933,421 5,721,741 01/31/1995 6,043,232 5,834,977 02/28/1995 6,182,752 5,973,708 03/31/1995 6,223,522 6,010,358 04/30/1995 6,299,808 6,094,313 05/31/1995 6,523,923 6,330,146 06/30/1995 6,551,569 6,376,556 07/31/1995 6,507,691 6,362,315 08/31/1995 6,628,805 6,439,100 09/30/1995 6,717,353 6,501,743 10/31/1995 6,829,613 6,586,296 11/30/1995 6,952,671 6,684,992 12/31/1995 7,059,284 6,778,807 01/31/1996 7,096,875 6,823,822 02/29/1996 6,956,380 6,705,209 03/31/1996 6,882,877 6,658,600 04/30/1996 6,829,282 6,621,153 05/31/1996 6,805,776 6,607,708 06/30/1996 6,917,299 6,696,445 07/31/1996 6,933,266 6,714,769 08/31/1996 6,916,233 6,703,516 09/30/1996 7,079,837 6,820,337 10/31/1996 7,268,469 6,971,417 11/30/1996 7,416,019 7,090,828 12/31/1996 7,331,446 7,024,898 01/31/1997 7,372,632 7,046,410 02/28/1997 7,387,727 7,063,938 03/31/1997 7,305,831 6,985,659 04/30/1997 7,418,069 7,090,230 05/31/1997 7,488,383 7,157,255 06/30/1997 7,571,276 7,242,207 07/31/1997 7,808,619 7,437,506 08/31/1997 7,730,081 7,374,066 09/30/1997 7,837,156 7,482,820 10/31/1997 7,950,092 7,591,375 11/30/1997 7,972,129 7,626,332 12/31/1997 8,063,867 7,703,117 01/31/1998 8,181,882 7,802,012 02/28/1998 8,157,419 7,795,787 03/31/1998 8,181,806 7,822,926 04/30/1998 8,222,040 7,863,759 05/31/1998 8,310,019 7,938,353 06/30/1998 8,398,686 8,005,677 07/31/1998 8,417,371 8,022,707 08/31/1998 8,634,608 8,153,272 09/30/1998 8,863,669 8,344,189 10/31/1998 8,784,161 8,300,070 11/30/1998 8,790,237 8,347,177 12/31/1998 8,840,354 8,372,274 01/31/1999 8,895,775 8,432,029 02/28/1999 8,717,208 8,284,832 03/31/1999 8,791,829 8,330,744 04/30/1999 8,826,341 8,357,136 05/31/1999 8,716,487 8,283,936 06/30/1999 8,686,621 8,257,544 07/31/1999 8,640,505 8,222,388 08/31/1999 8,645,072 8,218,287 09/30/1999 8,749,143 8,313,614 10/31/1999 8,774,371 8,344,288 11/30/1999 8,789,718 8,343,691 12/31/1999 8,745,555 8,303,456 01/31/2000 8,714,587 8,276,267 02/29/2000 8,804,572 8,376,357 03/31/2000 8,919,699 8,486,705 04/30/2000 8,885,298 8,462,404 05/31/2000 8,910,528 8,458,520 06/30/2000 9,090,806 8,634,499 07/31/2000 9,163,246 8,712,877 08/31/2000 9,307,790 8,839,159 09/30/2000 9,348,802 8,894,732 10/31/2000 9,424,027 8,953,590 11/30/2000 9,600,448 9,099,990 12/31/2000 9,776,445 9,268,798 01/31/2001 9,910,018 9,420,376 02/28/2001 10,026,066 9,502,440 03/31/2001 10,081,188 9,550,144 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 1/01/1992, the first full month following the Fund's Institutional Class inception on 12/30/1991, compared to the Lehman Brothers Aggregate Bond Index, an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 11/30/1994. PORTFOLIO INSIGHTS . The Total Return Fund II Institutional Class shares outperformed the Lehman Brothers Aggregate Bond Index for the one-year period ended March 31, 2001, returning 13.02% versus 12.53% for the Index. . The Fund's duration was moved above that of the Index in the second half of 2000, which had a positive impact on returns as intermediate rates fell. However, an emphasis on longer maturities detracted from returns as intermediate maturities outperformed. . An overweight in mortgages added to returns due to relatively high yields and low market volatility in 2000, but was negative in the first quarter of 2001 amid concern about prepayment risk. . An underweight in investment grade corporates helped returns in 2000 on concern about credit quality in this sector in a slowing economy, but was negative in the first quarter of 2001 as corporates recovered. 3.31.01 | PIMCO Funds Annual Report 5 PIMCO Total Return Fund III FUND CHARACTERISTICS Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily intermediate maturity fixed income securities with prohibitions on firms engaged in socially sensitive practices Duration: 5.5 years Total Net Assets: $880.0 million Sector Breakdown:* [GRAPH] Mortgage-Backed Securities 53.2% Corporate Bonds & Notes 20.4% U.S. Treasury Obligations 8.8% Other 17.6% Quality Breakdown:* [GRAPH] AAA 69.9% AA 4.0% A 16.2% BBB 6.7% BB 3.2% *% of Total Investments as of March 31, 2001 PERFORMANCE TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Lipper Intermediate Inst'l Class Admin. Class Lehman Brothers Investment Grade (Incep. 5/01/1991) (Incep. 4/11/1997) Aggregate Bond Index Debt Fund Average ----------------------------------------------------------------------------------------------------------- 1 Year 12.15% 11.83% 12.53% 11.21% 3 Years* 6.78% 6.50% 6.88% 5.86% 5 Years* 7.92% -- 7.48% 6.61% Since Inception * 8.75% 8.02% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] TOTAL RETURN FUND III Total Return Lehman Brothers MONTH Fund III Aggregate Bond Index -------------------------------------------------------------------------------- 04/30/1991 5,000,000 5,000,000 05/31/1991 5,024,573 5,029,239 06/30/1991 5,011,360 5,026,682 07/31/1991 5,091,347 5,096,389 08/31/1991 5,231,902 5,206,675 09/30/1991 5,362,299 5,312,180 10/31/1991 5,419,024 5,371,326 11/30/1991 5,475,902 5,420,576 12/31/1991 5,687,512 5,581,558 01/31/1992 5,605,239 5,505,625 02/29/1992 5,649,578 5,541,424 03/31/1992 5,621,306 5,510,184 04/30/1992 5,643,874 5,549,984 05/31/1992 5,752,958 5,654,712 06/30/1992 5,844,833 5,732,534 07/31/1992 6,028,857 5,849,491 08/31/1992 6,069,916 5,908,747 09/30/1992 6,112,922 5,978,788 10/31/1992 6,061,053 5,899,520 11/30/1992 6,110,005 5,900,854 12/31/1992 6,200,947 5,994,686 01/31/1993 6,262,534 6,109,641 02/28/1993 6,404,215 6,216,592 03/31/1993 6,434,449 6,242,496 04/30/1993 6,497,518 6,285,965 05/31/1993 6,501,189 6,293,970 06/30/1993 6,644,496 6,408,036 07/31/1993 6,697,102 6,444,279 08/31/1993 6,880,114 6,557,233 09/30/1993 6,894,099 6,575,243 10/31/1993 6,957,037 6,599,813 11/30/1993 6,917,372 6,543,670 12/31/1993 6,984,685 6,579,135 01/31/1994 7,060,374 6,667,964 02/28/1994 6,937,795 6,552,119 03/31/1994 6,797,242 6,390,581 04/30/1994 6,731,751 6,339,552 05/31/1994 6,676,376 6,338,662 06/30/1994 6,681,328 6,324,654 07/31/1994 6,815,349 6,450,282 08/31/1994 6,830,651 6,458,287 09/30/1994 6,760,588 6,363,232 10/31/1994 6,777,181 6,357,562 11/30/1994 6,726,341 6,343,443 12/31/1994 6,745,188 6,387,246 01/31/1995 6,870,185 6,513,652 02/28/1995 7,076,265 6,668,520 03/31/1995 7,131,606 6,709,432 04/30/1995 7,251,354 6,803,153 05/31/1995 7,479,227 7,066,416 06/30/1995 7,468,982 7,118,224 07/31/1995 7,469,280 7,102,326 08/31/1995 7,577,254 7,188,042 09/30/1995 7,661,664 7,257,971 10/31/1995 7,778,032 7,352,359 11/30/1995 7,920,241 7,462,534 12/31/1995 8,042,735 7,567,261 01/31/1996 8,110,490 7,617,512 02/29/1996 7,917,045 7,485,103 03/31/1996 7,848,991 7,433,072 04/30/1996 7,813,232 7,391,271 05/31/1996 7,795,663 7,376,262 06/30/1996 7,938,312 7,475,319 07/31/1996 7,953,817 7,495,775 08/31/1996 7,937,131 7,483,213 09/30/1996 8,134,267 7,613,621 10/31/1996 8,353,533 7,782,274 11/30/1996 8,530,260 7,915,573 12/31/1996 8,415,107 7,841,975 01/31/1997 8,452,273 7,865,989 02/28/1997 8,465,767 7,885,556 03/31/1997 8,379,284 7,798,172 04/30/1997 8,523,528 7,914,906 05/31/1997 8,625,020 7,989,727 06/30/1997 8,714,471 8,084,560 07/31/1997 8,945,988 8,302,575 08/31/1997 8,888,809 8,231,756 09/30/1997 9,006,608 8,353,160 10/31/1997 9,140,798 8,474,341 11/30/1997 9,172,684 8,513,363 12/31/1997 9,274,215 8,599,079 01/31/1998 9,418,706 8,709,477 02/28/1998 9,404,616 8,702,528 03/31/1998 9,436,938 8,732,823 04/30/1998 9,472,905 8,778,405 05/31/1998 9,559,386 8,861,676 06/30/1998 9,655,888 8,936,830 07/31/1998 9,697,309 8,955,841 08/31/1998 9,843,713 9,101,592 09/30/1998 10,148,628 9,314,715 10/31/1998 10,097,948 9,265,464 11/30/1998 10,154,614 9,318,050 12/31/1998 10,237,306 9,346,067 01/31/1999 10,291,019 9,412,772 02/28/1999 10,083,482 9,248,455 03/31/1999 10,210,751 9,299,706 04/30/1999 10,264,484 9,329,168 05/31/1999 10,112,792 9,247,454 06/30/1999 10,098,298 9,217,993 07/31/1999 10,060,554 9,178,748 08/31/1999 10,064,068 9,174,170 09/30/1999 10,149,144 9,280,584 10/31/1999 10,190,083 9,314,826 11/30/1999 10,208,038 9,314,159 12/31/1999 10,139,938 9,269,244 01/31/2000 9,971,148 9,238,894 02/29/2000 10,081,292 9,350,625 03/31/2000 10,244,449 9,473,807 04/30/2000 10,191,835 9,446,680 05/31/2000 10,178,995 9,442,344 06/30/2000 10,404,668 9,638,791 07/31/2000 10,480,599 9,726,286 08/31/2000 10,659,083 9,867,257 09/30/2000 10,682,050 9,929,292 10/31/2000 10,727,050 9,994,997 11/30/2000 10,921,300 10,158,425 12/31/2000 11,164,751 10,346,867 01/31/2001 11,321,486 10,516,076 02/28/2001 11,425,133 10,607,684 03/31/2001 11,489,223 10,660,937 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the invest- ment of $5,000,000 on 5/01/1991, the Fund's Institutional Class inception date, compared to the Lehman Brothers Aggregate Bond Index, an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 4/11/1997. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. PORTFOLIO INSIGHTS . The Total Return Fund III Institutional Class shares underperformed the Lehman Brothers Aggregate Bond Index for the one-year period ended March 31, 2001, returning 12.15% versus 12.53% for the Index. . The Fund's duration was moved above that of the Index in the second half of 2000, which had a positive impact on returns as intermediate rates fell. However, an emphasis on longer maturities detracted from returns as intermediate maturities outperformed. . An overweight in mortgages added to returns due to relatively high yields and low market volatility in 2000, but was negative in the first quarter of 2001 amid concern about prepayment risk. . An underweight in investment grade corporates helped returns in 2000 on concern about credit quality in this sector in a slowing economy, but was negative in the first quarter of 2001 as corporates recovered. A small high yield allocation was negative in 2000 but added to returns in the first quarter of 2001 when the sector rallied after Fed easing. . Within the international sector, emerging market bonds helped returns as yield premiums cushioned concerns about a global slowdown. Positions based on an expected rise in the euro were negative as the euro lost ground relative to the dollar. 6 PIMCO Funds Annual Report | 3.31.01 PIMCO Moderate Duration Fund FUND CHARACTERISTICS Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily short and intermediate maturity fixed income securities Duration: 4.1 years Total Net Assets: $576.9 million Sector Breakdown:* [GRAPH] Mortgage-Backed Securities 58.5% Corporate Bonds & Notes 13.8% Foreign Currency-Denominated Issues 6.3% Asset-Backed Securities 5.6% Other 15.8% Quality Breakdown:* [GRAPH] AAA 83.8% AA 3.4% A 5.3% BBB 6.7% BB 0.8% *% of Total Investments as of March 31, 2001 PERFORMANCE TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Lehman Brothers Lipper Short Intermediate Inst'l Class Intermediate Government/ Investment Grade (Incep. 12/31/1996) Corporate Bond Index Debt Fund Average ------------------------------------------------------------------------------------------------- 1 Year 12.09% 12.17% 9.94% 3 Years* 6.80% 6.85% 5.87% Since Inception* 7.02% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] MODERATE DURATION FUND Moderate Lehman Brothers Duration Interm. Gov't/ MONTH Fund Corporate Bond Index ------------------------------------------------------------------------------- 12/31/1996 5,000,000 5,000,000 01/31/1997 5,018,573 5,019,499 02/28/1997 5,025,671 5,029,037 03/31/1997 4,987,552 4,994,337 04/30/1997 5,045,822 5,053,270 05/31/1997 5,078,973 5,095,212 06/30/1997 5,141,280 5,141,578 07/31/1997 5,240,626 5,245,952 08/31/1997 5,220,094 5,219,722 09/30/1997 5,282,529 5,280,271 10/31/1997 5,331,654 5,338,882 11/30/1997 5,354,915 5,350,628 12/31/1997 5,398,734 5,393,432 01/31/1998 5,454,128 5,464,087 02/28/1998 5,448,868 5,459,715 03/31/1998 5,476,199 5,477,186 04/30/1998 5,507,779 5,504,572 05/31/1998 5,547,118 5,544,756 06/30/1998 5,574,030 5,580,242 07/31/1998 5,603,136 5,599,773 08/31/1998 5,657,953 5,687,689 09/30/1998 5,812,116 5,830,450 10/31/1998 5,807,792 5,824,620 11/30/1998 5,807,850 5,824,037 12/31/1998 5,837,909 5,847,334 01/31/1999 5,869,063 5,879,494 02/28/1999 5,778,416 5,793,065 03/31/1999 5,842,985 5,836,513 04/30/1999 5,861,195 5,854,606 05/31/1999 5,823,540 5,809,526 06/30/1999 5,805,584 5,813,592 07/31/1999 5,800,346 5,808,361 08/31/1999 5,804,694 5,813,007 09/30/1999 5,858,013 5,867,068 10/31/1999 5,893,763 5,882,322 11/30/1999 5,912,009 5,889,381 12/31/1999 5,890,158 5,869,946 01/31/2000 5,826,274 5,848,228 02/29/2000 5,873,746 5,896,183 03/31/2000 5,951,786 5,957,503 04/30/2000 5,955,966 5,943,800 05/31/2000 5,995,504 5,953,311 06/30/2000 6,078,846 6,058,088 07/31/2000 6,123,436 6,104,129 08/31/2000 6,204,722 6,176,158 09/30/2000 6,265,532 6,232,361 10/31/2000 6,292,005 6,261,030 11/30/2000 6,379,265 6,346,180 12/31/2000 6,486,663 6,462,950 01/31/2001 6,588,529 6,568,942 02/28/2001 6,633,080 6,631,347 03/31/2001 6,671,537 6,682,408 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the invest- ment of $5,000,000 on 12/31/1996, the Fund's Institutional Class inception date, compared to the Lehman Brothers Intermediate Government/Corporate Bond Index, an unmanaged market index. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. PORTFOLIO INSIGHTS . The Moderate Duration Fund Institutional Class shares underperformed the Lehman Brothers Intermediate Government/Corporate Bond Index for the one-year period ended March 31, 2001, returning 12.09% versus 12.17% for the Index. . The Fund's duration was increased above that of the Index in the second half of 2000, which had a positive impact on returns as intermediate rates fell. However, an emphasis on longer maturities detracted from returns as intermediate maturities outperformed. . An emphasis on mortgages added to returns due to relatively high yields and low market volatility in 2000, but was negative in the first quarter of 2001 amid concern about prepayment risk. . An underweight in investment grade corporates helped returns in 2000 on concern about credit quality in this sector in a slowing economy, but was negative in the first quarter of 2001 as corporates recovered. A small high yield allocation was negative in 2000 but added to returns in the first quarter of 2001 when the sector rallied after Fed easing. . Within the international sector, emerging market bonds helped returns as yield premiums cushioned concerns about a global slowdown. Positions based on an expected rise in the euro were negative as the euro lost ground relative to the dollar. 3.31.01 | PIMCO Funds Annual Report 7 PIMCO Low Duration Fund FUND CHARACTERISTICS Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily short maturity fixed income securities Duration: 2.2 years Total Net Assets: $4.6 billion Sector Breakdown:* [GRAPH] Mortgage-Backed Securities 59.6% Corporate Bonds & Notes 25.7% Other 14.7% Quality Breakdown:* [GRAPH] AAA 69.4% AA 4.5% A 14.8% BBB 9.7% BB 1.6% *% of Total Investments as of March 31, 2001 PERFORMANCE TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Lipper Short Inst'l Class Admin. Class Merrill Lynch 1-3 Investment Grade (Incep. 5/11/1987) (Incep. 12/31/1994) Year Treasury Index Debt Fund Average ---------------------------------------------------------------------------------------------------------- 1 Year 9.44% 9.17% 9.60% 8.97% 3 Years* 6.42% 6.16% 6.44% 5.81% 5 Years* 7.04% 6.78% 6.43% 5.94% 10 Years* 7.35% -- 6.48% 6.29% Since Inception* 7.88% 7.26% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] LOW DURATION FUND Merrill Lynch Low Duration 1-3 Year Treasury MONTH Fund Index -------------------------------------------------------------------------------- 05/31/1987 5,000,000 5,000,000 06/30/1987 5,046,628 5,054,486 07/31/1987 5,065,090 5,079,247 08/31/1987 5,064,335 5,083,277 09/30/1987 5,052,060 5,063,694 10/31/1987 5,133,989 5,175,497 11/30/1987 5,191,951 5,206,753 12/31/1987 5,222,390 5,239,924 01/31/1988 5,308,798 5,323,917 02/29/1988 5,347,411 5,367,579 03/31/1988 5,380,986 5,378,053 04/30/1988 5,403,325 5,385,796 05/31/1988 5,415,511 5,378,103 06/30/1988 5,466,198 5,433,788 07/31/1988 5,495,264 5,437,868 08/31/1988 5,517,425 5,449,457 09/30/1988 5,568,286 5,512,752 10/31/1988 5,619,832 5,567,754 11/30/1988 5,626,975 5,552,801 12/31/1988 5,652,043 5,565,872 01/31/1989 5,699,277 5,609,584 02/28/1989 5,708,130 5,609,468 03/31/1989 5,730,286 5,635,162 04/30/1989 5,798,151 5,721,387 05/31/1989 5,917,401 5,806,895 06/30/1989 6,046,639 5,915,301 07/31/1989 6,135,363 6,002,808 08/31/1989 6,107,180 5,965,890 09/30/1989 6,137,963 6,001,276 10/31/1989 6,219,093 6,091,880 11/30/1989 6,275,483 6,149,263 12/31/1989 6,307,554 6,173,858 01/31/1990 6,303,536 6,178,987 02/28/1990 6,346,767 6,207,779 03/31/1990 6,381,164 6,228,694 04/30/1990 6,377,250 6,240,900 05/31/1990 6,484,898 6,336,383 06/30/1990 6,554,775 6,403,041 07/31/1990 6,626,735 6,482,955 08/31/1990 6,639,802 6,502,338 09/30/1990 6,676,368 6,555,691 10/31/1990 6,724,978 6,627,712 11/30/1990 6,805,177 6,692,922 12/31/1990 6,878,682 6,774,101 01/31/1991 6,942,193 6,836,151 02/28/1991 6,997,644 6,876,758 03/31/1991 7,057,271 6,923,107 04/30/1991 7,143,402 6,988,670 05/31/1991 7,199,368 7,030,881 06/30/1991 7,245,425 7,059,426 07/31/1991 7,325,646 7,120,914 08/31/1991 7,430,571 7,218,612 09/30/1991 7,527,775 7,296,718 10/31/1991 7,593,269 7,375,086 11/30/1991 7,675,305 7,451,712 12/31/1991 7,804,629 7,565,276 01/31/1992 7,811,724 7,553,701 02/29/1992 7,850,357 7,579,762 03/31/1992 7,854,905 7,577,109 04/30/1992 7,910,379 7,646,439 05/31/1992 7,990,995 7,716,175 06/30/1992 8,065,552 7,794,942 07/31/1992 8,172,756 7,882,416 08/31/1992 8,227,543 7,951,624 09/30/1992 8,309,644 8,027,323 10/31/1992 8,312,516 7,979,320 11/30/1992 8,317,418 7,966,313 12/31/1992 8,404,634 8,041,993 01/31/1993 8,484,134 8,125,469 02/28/1993 8,584,735 8,194,941 03/31/1993 8,633,491 8,219,527 04/30/1993 8,674,838 8,270,487 05/31/1993 8,685,036 8,247,329 06/30/1993 8,771,815 8,308,113 07/31/1993 8,802,074 8,327,387 08/31/1993 8,888,391 8,400,002 09/30/1993 8,922,962 8,427,302 10/31/1993 8,984,843 8,443,819 11/30/1993 8,993,553 8,445,931 12/31/1993 9,056,846 8,477,097 01/31/1994 9,106,228 8,531,519 02/28/1994 9,066,980 8,477,003 03/31/1994 9,027,600 8,434,789 04/30/1994 8,998,069 8,404,930 05/31/1994 8,988,338 8,416,864 06/30/1994 9,007,246 8,441,778 07/31/1994 9,091,298 8,514,377 08/31/1994 9,129,999 8,544,348 09/30/1994 9,116,482 8,524,952 10/31/1994 9,115,926 8,544,133 11/30/1994 9,118,176 8,506,026 12/31/1994 9,113,801 8,525,250 01/31/1995 9,198,589 8,643,921 02/28/1995 9,314,539 8,762,689 03/31/1995 9,352,866 8,811,585 04/30/1995 9,470,326 8,890,096 05/31/1995 9,642,739 9,045,405 06/30/1995 9,692,391 9,094,070 07/31/1995 9,696,402 9,131,718 08/31/1995 9,802,372 9,186,053 09/30/1995 9,890,345 9,230,697 10/31/1995 9,964,908 9,308,604 11/30/1995 10,081,178 9,390,892 12/31/1995 10,201,089 9,463,014 01/31/1996 10,276,453 9,543,450 02/29/1996 10,210,333 9,503,081 03/31/1996 10,206,317 9,494,623 04/30/1996 10,210,668 9,502,599 05/31/1996 10,220,903 9,522,079 06/30/1996 10,324,796 9,590,448 07/31/1996 10,360,157 9,628,235 08/31/1996 10,411,622 9,661,259 09/30/1996 10,559,003 9,748,888 10/31/1996 10,711,509 9,858,660 11/30/1996 10,856,335 9,934,177 12/31/1996 10,827,172 9,934,177 01/31/1997 10,917,928 9,980,768 02/28/1997 10,962,362 10,003,723 03/31/1997 10,918,161 9,999,822 04/30/1997 11,051,403 10,081,520 05/31/1997 11,144,606 10,150,277 06/30/1997 11,232,679 10,220,213 07/31/1997 11,414,133 10,332,533 08/31/1997 11,408,378 10,342,038 09/30/1997 11,508,994 10,420,534 10/31/1997 11,594,791 10,497,958 11/30/1997 11,628,837 10,523,470 12/31/1997 11,718,950 10,595,345 01/31/1998 11,808,398 10,698,225 02/28/1998 11,849,111 10,707,426 03/31/1998 11,900,389 10,751,006 04/30/1998 11,965,788 10,801,320 05/31/1998 12,042,787 10,858,892 06/30/1998 12,072,222 10,915,357 07/31/1998 12,130,281 10,966,441 08/31/1998 12,177,935 11,104,289 09/30/1998 12,426,371 11,251,422 10/31/1998 12,407,993 11,306,666 11/30/1998 12,480,576 11,296,829 12/31/1998 12,558,314 11,336,708 01/31/1999 12,614,507 11,381,600 02/28/1999 12,548,547 11,326,059 03/31/1999 12,656,332 11,404,775 04/30/1999 12,723,248 11,441,498 05/31/1999 12,683,445 11,434,174 06/30/1999 12,690,305 11,469,850 07/31/1999 12,692,072 11,506,210 08/31/1999 12,701,307 11,539,462 09/30/1999 12,796,976 11,614,468 10/31/1999 12,850,766 11,645,363 11/30/1999 12,906,395 11,667,372 12/31/1999 12,931,228 11,684,058 01/31/2000 12,915,977 11,679,735 02/29/2000 13,009,930 11,757,522 03/31/2000 13,106,258 11,830,418 04/30/2000 13,135,290 11,861,176 05/31/2000 13,175,787 11,909,925 06/30/2000 13,335,487 12,033,551 07/31/2000 13,416,218 12,109,603 08/31/2000 13,566,278 12,198,850 09/30/2000 13,635,215 12,286,438 10/31/2000 13,636,576 12,352,416 11/30/2000 13,743,722 12,469,270 12/31/2000 13,926,801 12,618,029 01/31/2001 14,154,253 12,776,132 02/28/2001 14,225,101 12,859,176 03/31/2001 14,343,928 12,966,423 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the invest- ment of $5,000,000 on 6/01/1987, the first full month following the Fund's Institutional Class inception on 5/11/1987, compared to the Merrill Lynch 1-3 Year Treasury Index, an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 12/31/1994. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. PORTFOLIO INSIGHTS . The Low Duration Fund Institutional Class shares returned 9.44% for the annual period ended March 31, 2001, underperforming the benchmark Merrill Lynch 1-3 Year Treasury Index return of 9.60%. . The Fund maintained an above-Index duration throughout the period, which added to returns as interest rates decreased approximately 1.75% on short- to intermediate-maturity instruments. . Our broader-than-Index maturity distribution had a positive impact on performance as intermediate maturity rates fell the most. . An allocation to mortgage-backed securities was positive for performance as higher yields offset heightened volatility. . The Fund's investment-grade corporate holdings slightly detracted from performance as concerns about a slowing economy hurt this sector. . Below-investment-grade holdings were negative as default rates increased and corporate profitability eroded. . Limited holdings of U.S. dollar-denominated emerging markets bonds were neutral for performance. 8 PIMCO Funds Annual Report | 3.31.01 PIMCO Low Duration Fund II FUND CHARACTERISTICS Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily short maturity fixed income securities with quality and non-U.S. issuer restrictions Duration: 2.0 years Total Net Assets: $636.6 million Sector Breakdown:* [GRAPH] Mortgage-Backed Securities 72.2% Corporate Bonds & Notes 17.7% Other 10.1% Quality Breakdown:* [GRAPH] AAA 80.8% AA 4.2% A 15.0% *% of Total Investments as of March 31, 2001 PERFORMANCE TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Lipper Short Inst'l Class Admin. Class Merrill Lynch 1-3 Investment Grade (Incep. 11/01/1991) (Incep. 2/02/1998) Year Treasury Index Debt Fund Average ----------------------------------------------------------------------------------------------------------- 1 Year 9.74% 9.50% 9.60% 8.97% 3 Years* 6.27% 6.01% 6.44% 5.81% 5 Years* 6.68% -- 6.43% 5.94% Since Inception* 6.45% 5.90% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] LOW DURATION FUND II Merrill Lynch Low Duration 1-3 Year Treasury MONTH Fund II Index -------------------------------------------------------------------------------- 10/31/1991 5,000,000 5,000,000 11/30/1991 5,070,496 5,051,950 12/31/1991 5,150,788 5,128,941 01/31/1992 5,126,506 5,121,094 02/29/1992 5,159,358 5,138,762 03/31/1992 5,157,326 5,136,964 04/30/1992 5,197,109 5,183,966 05/31/1992 5,240,589 5,231,244 06/30/1992 5,302,476 5,284,645 07/31/1992 5,355,736 5,343,949 08/31/1992 5,377,728 5,390,869 09/30/1992 5,426,036 5,442,189 10/31/1992 5,423,401 5,409,645 11/30/1992 5,417,545 5,400,827 12/31/1992 5,471,783 5,452,135 01/31/1993 5,544,427 5,508,728 02/28/1993 5,600,313 5,555,828 03/31/1993 5,619,040 5,572,496 04/30/1993 5,660,962 5,607,045 05/31/1993 5,649,149 5,591,344 06/30/1993 5,710,514 5,632,553 07/31/1993 5,724,808 5,645,621 08/31/1993 5,775,444 5,694,851 09/30/1993 5,794,689 5,713,359 10/31/1993 5,802,333 5,724,557 11/30/1993 5,799,743 5,725,988 12/31/1993 5,831,720 5,747,117 01/31/1994 5,872,093 5,784,014 02/28/1994 5,850,184 5,747,054 03/31/1994 5,796,320 5,718,434 04/30/1994 5,779,212 5,698,191 05/31/1994 5,767,710 5,706,282 06/30/1994 5,772,326 5,723,172 07/31/1994 5,831,607 5,772,392 08/31/1994 5,826,033 5,792,711 09/30/1994 5,810,813 5,779,561 10/31/1994 5,821,529 5,792,565 11/30/1994 5,828,521 5,766,731 12/31/1994 5,850,354 5,779,763 01/31/1995 5,935,515 5,860,217 02/28/1995 6,029,620 5,940,737 03/31/1995 6,074,370 5,973,886 04/30/1995 6,107,608 6,027,114 05/31/1995 6,211,631 6,132,407 06/30/1995 6,235,805 6,165,399 07/31/1995 6,243,368 6,190,923 08/31/1995 6,297,641 6,227,760 09/30/1995 6,346,020 6,258,027 10/31/1995 6,405,255 6,310,844 11/30/1995 6,478,110 6,366,632 12/31/1995 6,539,804 6,415,528 01/31/1996 6,580,351 6,470,061 02/29/1996 6,535,860 6,442,692 03/31/1996 6,518,000 6,436,958 04/30/1996 6,505,764 6,442,365 05/31/1996 6,502,485 6,455,572 06/30/1996 6,575,782 6,501,923 07/31/1996 6,606,321 6,527,541 08/31/1996 6,630,457 6,549,930 09/30/1996 6,719,145 6,609,338 10/31/1996 6,816,464 6,683,760 11/30/1996 6,887,004 6,734,957 12/31/1996 6,881,011 6,734,957 01/31/1997 6,918,655 6,766,544 02/28/1997 6,946,342 6,782,107 03/31/1997 6,930,530 6,779,461 04/30/1997 6,993,758 6,834,850 05/31/1997 7,044,400 6,881,464 06/30/1997 7,099,424 6,928,877 07/31/1997 7,200,340 7,005,026 08/31/1997 7,201,737 7,011,470 09/30/1997 7,257,640 7,064,687 10/31/1997 7,324,878 7,117,177 11/30/1997 7,343,098 7,134,473 12/31/1997 7,405,208 7,183,201 01/31/1998 7,464,768 7,252,950 02/28/1998 7,477,590 7,259,187 03/31/1998 7,505,393 7,288,733 04/30/1998 7,541,498 7,322,844 05/31/1998 7,593,666 7,361,875 06/30/1998 7,623,903 7,400,156 07/31/1998 7,657,543 7,434,789 08/31/1998 7,746,767 7,528,244 09/30/1998 7,854,078 7,627,994 10/31/1998 7,838,078 7,665,447 11/30/1998 7,857,712 7,658,778 12/31/1998 7,893,710 7,685,814 01/31/1999 7,943,452 7,716,249 02/28/1999 7,885,625 7,678,594 03/31/1999 7,947,390 7,731,961 04/30/1999 7,979,520 7,756,857 05/31/1999 7,950,895 7,751,892 06/30/1999 7,933,181 7,776,079 07/31/1999 7,948,712 7,800,729 08/31/1999 7,953,224 7,823,273 09/30/1999 8,024,423 7,874,124 10/31/1999 8,063,922 7,895,070 11/30/1999 8,094,148 7,909,991 12/31/1999 8,095,132 7,921,303 01/31/2000 8,091,435 7,918,372 02/29/2000 8,147,721 7,971,109 03/31/2000 8,208,297 8,020,529 04/30/2000 8,230,192 8,041,382 05/31/2000 8,254,772 8,074,432 06/30/2000 8,344,502 8,158,245 07/31/2000 8,402,661 8,209,805 08/31/2000 8,475,367 8,270,310 09/30/2000 8,548,174 8,329,692 10/31/2000 8,593,470 8,374,422 11/30/2000 8,667,062 8,453,644 12/31/2000 8,750,262 8,554,496 01/31/2001 8,883,371 8,661,684 02/28/2001 8,923,988 8,717,984 03/31/2001 9,007,545 8,790,693 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 11/01/1991, the Fund's Institutional Class inception date, compared to the Merrill Lynch 1-3 Year Treasury Index, an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annual basis. The Administrative Class commenced operations on 2/02/1998. PORTFOLIO INSIGHTS . The Low Duration Fund II Institutional Class shares returned 9.74% for the annual period ended March 31, 2001, outperforming the 9.60% return of the benchmark Merrill Lynch 1-3 Year Treasury Index. . The Fund maintained an above-Index duration throughout the period, which added to returns as interest rates decreased approximately 1.75% on short- to intermediate-maturity instruments. . Our broader-than-Index maturity distribution had a positive impact on performance as intermediate maturity rates fell the most. . An allocation to mortgage-backed securities was positive for performance as higher yields offset heightened volatility. . The Fund's investment-grade corporate holdings slightly detracted from performance as concerns about a slowing economy hurt this sector. 3.31.01 | PIMCO Funds Annual Report 9 PIMCO Low Duration Fund III FUND CHARACTERISTICS Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily short maturity fixed income securities with prohibitions on firms engaged in socially sensitive practices Duration: 2.3 years Total Net Assets: $42.9 million Sector Breakdown:* [GRAPH] Mortgage-Backed Securities 65.3% Corporate Bonds & Notes 23.5% U.S. Treasury Obligations 5.2% Other 6.0% Quality Breakdown:* [GRAPH] AAA 75.4% AA 6.0% A 10.0% BBB 7.8% BB 0.8% *% of Total Investments as of March 31, 2001 PERFORMANCE TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Lipper Short Inst'l Class Admin. Class Merrill Lynch 1-3 Investment Grade (Incep. 12/31/1996) (Incep. 3/19/1999) Year Treasury Index Debt Fund Average --------------------------------------------------------------------------------------------------------------------- 1 Year 9.06% 8.82% 9.60% 8.97% 3 Years* 6.02% -- 6.44% 5.81% Since Inception* 6.25% 5.70% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] LOW DURATION III Merrill Lynch Low Duration 1-3 Year Treasury MONTH Fund III Index -------------------------------------------------------------------------------- 12/31/1996 5,000,000 5,000,000 01/31/1997 5,019,544 5,023,450 02/28/1997 5,044,724 5,035,003 03/31/1997 5,028,885 5,033,040 04/30/1997 5,074,774 5,074,160 05/31/1997 5,116,879 5,108,766 06/30/1997 5,156,800 5,143,965 07/31/1997 5,193,007 5,200,497 08/31/1997 5,219,920 5,205,281 09/30/1997 5,260,771 5,244,790 10/31/1997 5,310,323 5,283,758 11/30/1997 5,313,692 5,296,598 12/31/1997 5,355,776 5,332,774 01/31/1998 5,393,985 5,384,555 02/28/1998 5,402,862 5,389,186 03/31/1998 5,427,616 5,411,120 04/30/1998 5,458,772 5,436,444 05/31/1998 5,490,624 5,465,421 06/30/1998 5,503,181 5,493,840 07/31/1998 5,527,294 5,519,552 08/31/1998 5,543,567 5,588,932 09/30/1998 5,649,590 5,662,986 10/31/1998 5,656,322 5,690,791 11/30/1998 5,694,733 5,685,840 12/31/1998 5,712,097 5,705,912 01/31/1999 5,732,230 5,728,507 02/28/1999 5,719,966 5,700,552 03/31/1999 5,758,729 5,740,171 04/30/1999 5,794,632 5,758,654 05/31/1999 5,786,934 5,754,968 06/30/1999 5,775,306 5,772,924 07/31/1999 5,775,192 5,791,224 08/31/1999 5,779,894 5,807,961 09/30/1999 5,833,335 5,845,712 10/31/1999 5,851,977 5,861,262 11/30/1999 5,870,819 5,872,339 12/31/1999 5,868,064 5,880,737 01/31/2000 5,860,600 5,878,562 02/29/2000 5,890,024 5,917,713 03/31/2000 5,930,458 5,954,402 04/30/2000 5,948,746 5,969,883 05/31/2000 5,969,290 5,994,419 06/30/2000 6,042,394 6,056,642 07/31/2000 6,085,896 6,094,920 08/31/2000 6,140,202 6,139,839 09/30/2000 6,195,214 6,183,923 10/31/2000 6,177,912 6,217,130 11/30/2000 6,243,517 6,275,945 12/31/2000 6,303,425 6,350,817 01/31/2001 6,394,711 6,430,393 02/28/2001 6,424,571 6,472,190 03/31/2001 6,467,996 6,526,168 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the invest- ment of $5,000,000 on 12/31/1996, the Fund's Institutional Class inception date, compared to the Merrill Lynch 1-3 Year Treasury Index, an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 3/19/1999. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. PORTFOLIO INSIGHTS . The Low Duration Fund III Institutional Class shares returned 9.06% for the one-year period ended March 31, 2001, underperforming the benchmark Merrill Lynch 1-3 Year Treasury Index return of 9.60%. . The Fund maintained an above-Index duration throughout the period, which added to returns as interest rates decreased approximately 1.75% on short- to intermediate-maturity instruments. . Our broader-than-Index maturity distribution had a positive impact on performance as intermediate maturity rates fell the most. . An allocation to mortgage-backed securities was positive for performance as higher yields offset heightened volatility. . The Fund's investment-grade corporate holdings slightly detracted from performance as concerns about a slowing economy hurt this sector. . Below-investment-grade holdings were negative as default rates increased and corporate profitability eroded. . Limited holdings of U.S. dollar-denominated emerging markets bonds were neutral to performance. 10 PIMCO Funds Annual Report | 3.31.01 PIMCO Short-Term Fund FUND CHARACTERISTICS Objective: Maximum current income, consistent with preservation of capital and daily liquidity Portfolio: Primarily money market instruments and short maturity fixed income securities Duration: 0.5 years Total Net Assets: $651.2 million Sector Breakdown:* [GRAPH] Corporate Bonds & Notes 35.5% U.S. Treasury Obligations 25.0% Mortgage-Backed Securities 16.1% U.S. Government Agencies 13.8% Asset-Backed Securities 5.1% Other 4.5% Quality Breakdown:* [GRAPH] AAA 44.4% AA 10.7% A 23.9% BBB 18.3% BB 2.7% *% of Total Investments as of March 31, 2001 PERFORMANCE TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Salomon Lipper Ultra-Short Inst'l Class Admin. Class 3-Month Treasury Obligation (Incep. 10/07/1987) (Incep. 2/01/1996) Bill Index Fund Average --------------------------------------------------------------------------------------------------------- 1 Year 7.65% 7.40% 6.02% 7.10% 3 Years* 6.15% 5.90% 5.29% 5.69% 5 Years* 6.53% 6.27% 5.27% 5.81% 10 Years* 5.88% -- 4.84% 5.43% Since Inception* 6.50% 6.15% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] SHORT-TERM FUND Salomon 3-Month Short-Term Treasury Bill MONTH Fund Index -------------------------------------------------------------------------------- 10/31/1987 5,000,000 5,000,000 11/30/1987 5,029,461 5,025,505 12/31/1987 5,060,119 5,049,416 01/31/1988 5,094,787 5,074,145 02/29/1988 5,116,116 5,096,972 03/31/1988 5,144,560 5,121,946 04/30/1988 5,173,186 5,147,043 05/31/1988 5,202,593 5,173,283 06/30/1988 5,232,291 5,200,710 07/31/1988 5,259,411 5,229,832 08/31/1988 5,293,423 5,260,160 09/30/1988 5,328,409 5,291,715 10/31/1988 5,375,276 5,323,984 11/30/1988 5,411,635 5,357,521 12/31/1988 5,443,779 5,392,345 01/31/1989 5,483,420 5,429,009 02/28/1989 5,522,499 5,467,021 03/31/1989 5,571,029 5,506,382 04/30/1989 5,613,569 5,547,685 05/31/1989 5,665,094 5,589,294 06/30/1989 5,708,266 5,628,410 07/31/1989 5,756,794 5,667,812 08/31/1989 5,788,039 5,706,356 09/30/1989 5,828,328 5,743,449 10/31/1989 5,883,335 5,782,504 11/30/1989 5,922,983 5,820,087 12/31/1989 5,957,698 5,858,508 01/31/1990 5,987,232 5,897,174 02/28/1990 6,024,238 5,932,550 03/31/1990 6,064,842 5,972,300 04/30/1990 6,090,417 6,011,109 05/31/1990 6,148,665 6,051,983 06/30/1990 6,189,318 6,091,324 07/31/1990 6,232,885 6,131,523 08/31/1990 6,267,095 6,171,375 09/30/1990 6,309,632 6,209,019 10/31/1990 6,358,334 6,247,522 11/30/1990 6,409,912 6,284,390 12/31/1990 6,462,141 6,325,239 01/31/1991 6,509,418 6,361,294 02/28/1991 6,545,494 6,392,464 03/31/1991 6,576,473 6,425,704 04/30/1991 6,618,103 6,456,547 05/31/1991 6,656,338 6,487,540 06/30/1991 6,682,104 6,517,381 07/31/1991 6,722,727 6,548,666 08/31/1991 6,766,617 6,579,444 09/30/1991 6,804,471 6,608,395 10/31/1991 6,844,965 6,637,470 11/30/1991 6,862,973 6,664,021 12/31/1991 6,892,228 6,688,678 01/31/1992 6,919,339 6,712,089 02/29/1992 6,934,403 6,732,895 03/31/1992 6,948,634 6,755,787 04/30/1992 6,979,006 6,777,407 05/31/1992 7,001,946 6,799,771 06/30/1992 7,031,099 6,820,171 07/31/1992 7,061,296 6,840,632 08/31/1992 7,080,606 6,859,785 09/30/1992 7,100,505 6,876,934 10/31/1992 7,109,622 6,894,125 11/30/1992 7,119,728 6,911,360 12/31/1992 7,142,089 6,930,020 01/31/1993 7,167,580 6,948,732 02/28/1993 7,187,715 6,964,714 03/31/1993 7,222,352 6,982,126 04/30/1993 7,248,666 6,998,882 05/31/1993 7,279,042 7,016,380 06/30/1993 7,309,491 7,033,921 07/31/1993 7,337,521 7,052,210 08/31/1993 7,358,333 7,070,546 09/30/1993 7,378,551 7,088,221 10/31/1993 7,406,168 7,106,651 11/30/1993 7,435,531 7,124,417 12/31/1993 7,472,268 7,142,941 01/31/1994 7,487,037 7,161,512 02/28/1994 7,497,133 7,178,699 03/31/1994 7,486,772 7,198,799 04/30/1994 7,500,714 7,220,394 05/31/1994 7,507,684 7,244,222 06/30/1994 7,544,131 7,268,852 07/31/1994 7,581,551 7,295,019 08/31/1994 7,613,244 7,322,010 09/30/1994 7,623,522 7,349,101 10/31/1994 7,645,459 7,379,233 11/30/1994 7,653,660 7,410,225 12/31/1994 7,688,576 7,444,312 01/31/1995 7,728,764 7,478,556 02/28/1995 7,801,580 7,511,461 03/31/1995 7,820,739 7,548,268 04/30/1995 7,906,502 7,584,500 05/31/1995 7,988,187 7,621,664 06/30/1995 8,016,388 7,657,486 07/31/1995 8,066,833 7,694,241 08/31/1995 8,106,191 7,730,404 09/30/1995 8,183,875 7,765,192 10/31/1995 8,244,808 7,800,911 11/30/1995 8,323,417 7,835,235 12/31/1995 8,396,279 7,871,277 01/31/1996 8,438,474 7,906,698 02/29/1996 8,455,531 7,939,115 03/31/1996 8,484,975 7,972,459 04/30/1996 8,526,887 8,005,146 05/31/1996 8,573,734 8,039,568 06/30/1996 8,622,971 8,073,335 07/31/1996 8,649,616 8,108,049 08/31/1996 8,706,604 8,143,726 09/30/1996 8,792,582 8,178,744 10/31/1996 8,865,196 8,214,729 11/30/1996 8,947,374 8,249,233 12/31/1996 8,984,288 8,284,703 01/31/1997 9,039,631 8,320,328 02/28/1997 9,081,953 8,352,778 03/31/1997 9,089,081 8,389,529 04/30/1997 9,142,882 8,425,604 05/31/1997 9,211,364 8,462,676 06/30/1997 9,273,987 8,498,220 07/31/1997 9,348,891 8,534,763 08/31/1997 9,379,554 8,571,461 09/30/1997 9,444,784 8,607,463 10/31/1997 9,469,319 8,645,334 11/30/1997 9,513,992 8,681,646 12/31/1997 9,569,434 8,718,978 01/31/1998 9,628,194 8,757,342 02/28/1998 9,663,998 8,792,371 03/31/1998 9,730,989 8,831,057 04/30/1998 9,777,926 8,868,142 05/31/1998 9,824,621 8,906,281 06/30/1998 9,860,451 8,942,797 07/31/1998 9,921,920 8,980,356 08/31/1998 9,927,830 9,018,971 09/30/1998 9,996,273 9,055,950 10/31/1998 10,036,673 9,092,174 11/30/1998 10,073,050 9,125,815 12/31/1998 10,118,477 9,159,581 01/31/1999 10,160,402 9,193,471 02/28/1999 10,203,832 9,224,729 03/31/1999 10,278,911 9,259,782 04/30/1999 10,329,119 9,294,044 05/31/1999 10,333,674 9,329,361 06/30/1999 10,372,627 9,363,879 07/31/1999 10,411,216 9,400,399 08/31/1999 10,447,798 9,438,001 09/30/1999 10,497,169 9,474,808 10/31/1999 10,550,411 9,513,656 11/30/1999 10,602,935 9,551,709 12/31/1999 10,648,527 9,592,783 01/31/2000 10,677,925 9,634,991 02/29/2000 10,740,147 9,676,420 03/31/2000 10,812,389 9,721,898 04/30/2000 10,854,585 9,767,591 05/31/2000 10,916,030 9,815,452 06/30/2000 10,985,938 9,861,584 07/31/2000 11,045,435 9,908,919 08/31/2000 11,117,564 9,957,968 09/30/2000 11,184,834 10,007,758 10/31/2000 11,236,895 10,060,199 11/30/2000 11,330,833 10,111,505 12/31/2000 11,424,107 10,165,096 01/31/2001 11,505,558 10,217,956 02/28/2001 11,585,092 10,261,893 03/31/2001 11,639,557 10,307,044 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 11/01/1987, the first full month following the Fund's Institutional Class inception on 10/07/1987, compared to the Salomon 3- Month Treasury Bill Index, an unmanaged market index. Whereas money market funds attempt to maintain a stable share price, the Short-Term Fund's share price will fluctuate in response to market conditions. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 2/01/1996. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. PORTFOLIO INSIGHTS . The Short-Term Fund Institutional Class shares returned 7.65% for the annual period ended March 31, 2001, outperforming the Salomon 3-Month Treasury Bill Index return of 6.02%. . An above-Index duration boosted returns as short-term interest rates fell significantly. . An allocation to mortgage-backed securities was neutral for performance as higher yields heightened market volatility and rising prepayments put pressure on prices. . The Fund's investment-grade corporate holdings slightly enhanced performance as Fed easing sparked a recovery that allowed corporates to gain ground. . Below-investment-grade holdings were negative amid concerns about credit quality. . Limited holdings of U.S. dollar-denominated emerging markets bonds were positive due to the higher yields provided by these issues and because problem credits were avoided. . Real return bonds added to relative returns, outperforming like-duration Treasuries as real yields fell. 3.31.01 | PIMCO Funds Annual Report 11 PIMCO Money Market Fund FUND CHARACTERISTICS Objective: Maximum current income, consistent with preservation of capital and daily liquidity Portfolio: Primarily money market instruments Duration: 47.0 days Total Net Assets: $348.9 million Sector Breakdown:* [GRAPH] Short-Term Instruments 66.4% Corporate Bonds & Notes 31.9% Other 1.7% Quality Breakdown:* [GRAPH] AAA 58.7% AA 40.7% A 0.6% *% of Total Investments as of March 31, 2001 PERFORMANCE TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Lipper Inst'l Inst'l Class Admin. Class Salomon 3-Month Money Market (Incep. 3/01/1991) (Incep. 1/24/1995) Treasury Bill Index Fund Average ------------------------------------------------------------------------------------------------------- 7 Day Yield 5.15% 4.88% -- -- 1 Year 6.20% 5.94% 6.02% 6.16% 3 Years* 5.51% 5.28% 5.29% 5.51% 5 Years* 5.43% 5.18% 5.27% 5.43% 10 Years* 4.89% -- 4.84% 4.93% Since Inception* 4.89% 5.28% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] MONEY MARKET FUND Salomon 3-Month Money Market Treasury Bill MONTH Fund Index -------------------------------------------------------------------------------- 02/28/1991 5,000,000 5,000,000 03/31/1991 5,025,170 5,026,000 04/30/1991 5,050,085 5,050,124 05/31/1991 5,075,810 5,074,366 06/30/1991 5,098,544 5,097,707 07/31/1991 5,122,151 5,122,177 08/31/1991 5,146,158 5,146,250 09/30/1991 5,168,071 5,168,895 10/31/1991 5,189,068 5,191,637 11/30/1991 5,209,752 5,212,405 12/31/1991 5,235,296 5,231,691 01/31/1992 5,253,666 5,250,001 02/29/1992 5,269,348 5,266,276 03/31/1992 5,286,316 5,284,181 04/30/1992 5,302,529 5,301,091 05/31/1992 5,318,495 5,318,584 06/30/1992 5,333,833 5,334,540 07/31/1992 5,349,339 5,350,544 08/31/1992 5,362,691 5,365,525 09/30/1992 5,375,416 5,378,938 10/31/1992 5,388,548 5,392,385 11/30/1992 5,400,824 5,405,865 12/31/1992 5,415,417 5,420,461 01/31/1993 5,427,493 5,435,097 02/28/1993 5,439,092 5,447,597 03/31/1993 5,452,504 5,461,217 04/30/1993 5,464,658 5,474,323 05/31/1993 5,475,877 5,488,009 06/30/1993 5,489,090 5,501,729 07/31/1993 5,501,737 5,516,034 08/31/1993 5,515,161 5,530,376 09/30/1993 5,527,714 5,544,202 10/31/1993 5,541,036 5,558,617 11/30/1993 5,554,511 5,572,513 12/31/1993 5,567,081 5,587,002 01/31/1994 5,580,537 5,601,527 02/28/1994 5,592,446 5,614,971 03/31/1994 5,606,276 5,630,692 04/30/1994 5,620,505 5,647,583 05/31/1994 5,637,321 5,666,220 06/30/1994 5,654,814 5,685,485 07/31/1994 5,672,813 5,705,953 08/31/1994 5,694,234 5,727,064 09/30/1994 5,714,049 5,748,254 10/31/1994 5,736,363 5,771,822 11/30/1994 5,759,664 5,796,064 12/31/1994 5,785,415 5,822,725 01/31/1995 5,813,735 5,849,510 02/28/1995 5,839,234 5,875,247 03/31/1995 5,867,023 5,904,036 04/30/1995 5,892,850 5,932,376 05/31/1995 5,923,104 5,961,445 06/30/1995 5,950,960 5,989,464 07/31/1995 5,979,025 6,018,213 08/31/1995 6,006,869 6,046,498 09/30/1995 6,032,542 6,073,708 10/31/1995 6,061,076 6,101,647 11/30/1995 6,105,719 6,128,494 12/31/1995 6,136,175 6,156,685 01/31/1996 6,164,350 6,184,390 02/29/1996 6,191,072 6,209,746 03/31/1996 6,217,237 6,235,827 04/30/1996 6,244,019 6,261,393 05/31/1996 6,273,132 6,288,317 06/30/1996 6,297,220 6,314,729 07/31/1996 6,324,461 6,341,881 08/31/1996 6,354,570 6,369,786 09/30/1996 6,379,780 6,397,177 10/31/1996 6,406,912 6,425,323 11/30/1996 6,433,601 6,452,311 12/31/1996 6,460,353 6,480,054 01/31/1997 6,488,472 6,507,920 02/28/1997 6,513,657 6,533,301 03/31/1997 6,539,911 6,562,047 04/30/1997 6,567,988 6,590,263 05/31/1997 6,598,555 6,619,260 06/30/1997 6,626,256 6,647,062 07/31/1997 6,655,217 6,675,644 08/31/1997 6,686,098 6,704,349 09/30/1997 6,714,110 6,732,508 10/31/1997 6,746,003 6,762,130 11/30/1997 6,773,457 6,790,532 12/31/1997 6,805,247 6,819,732 01/31/1998 6,836,094 6,849,739 02/28/1998 6,863,584 6,877,138 03/31/1998 6,893,016 6,907,397 04/30/1998 6,922,674 6,936,404 05/31/1998 6,953,532 6,966,235 06/30/1998 6,983,538 6,994,797 07/31/1998 7,016,569 7,024,175 08/31/1998 7,045,979 7,054,378 09/30/1998 7,076,192 7,083,302 10/31/1998 7,107,700 7,111,635 11/30/1998 7,136,327 7,137,948 12/31/1998 7,168,594 7,164,359 01/31/1999 7,194,413 7,190,867 02/28/1999 7,219,300 7,215,316 03/31/1999 7,247,024 7,242,733 04/30/1999 7,276,038 7,269,532 05/31/1999 7,301,880 7,297,156 06/30/1999 7,329,104 7,324,155 07/31/1999 7,359,334 7,352,720 08/31/1999 7,388,408 7,382,131 09/30/1999 7,418,652 7,410,920 10/31/1999 7,450,747 7,441,306 11/30/1999 7,482,278 7,471,070 12/31/1999 7,519,731 7,503,197 01/31/2000 7,552,712 7,536,211 02/29/2000 7,586,023 7,568,616 03/31/2000 7,624,519 7,604,187 04/30/2000 7,657,193 7,639,927 05/31/2000 7,694,457 7,677,362 06/30/2000 7,736,374 7,713,445 07/31/2000 7,775,004 7,750,470 08/31/2000 7,817,526 7,788,834 09/30/2000 7,859,326 7,827,778 10/31/2000 7,900,222 7,868,796 11/30/2000 7,941,283 7,908,926 12/31/2000 7,985,711 7,950,844 01/31/2001 8,024,932 7,992,189 02/28/2001 8,061,082 8,026,556 03/31/2001 8,097,308 8,061,871 Past performance and yields are no guarantee of future results. Yields are computed by SEC-prescribed calculations. The line graph above assumes the investment of $5,000,000 on 3/01/1991, the Fund's Institutional Class inception date, compared to the Salomon 3-Month Treasury Bill Index, an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 1/24/1995. An investment in the Money Market Fund is neither insured nor guaranteed by the Federal Deposit Insurance Corporation or any other U.S. Government agency. Although the fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the fund. If there is a material difference between the quoted total return and the quoted current yield, the yield quotation more closely reflects the current earnings of the Money Market Fund than the total return quotation. PORTFOLIO INSIGHTS . The Money Market Fund Institutional Class shares returned 6.20% for the annual period ended March 31, 2001, outperforming the Salomon 3-Month Treasury Bill Index return of 6.02%. . The Fund, which has a Aaa money market fund rating by Moody's Investors Service, emphasizes high quality commercial paper, shorter-term agency and high quality corporate debt issues due to strong liquidity, attractive yields and limited credit risks. . High quality (A1/P1) commercial paper yields fell approximately 1.40% for three-month maturities, reflecting three Federal Reserve rate decreases totaling 1.50%. . Three-month commercial paper yields relative to Treasuries widened by 0.18% to become approximately 0.58% on March 31. . The SEC 7-day and 30-day yields for the Fund were 5.15% and 5.25%, respectively as of March 31, 2001. 12 PIMCO Funds Annual Report | 3.31.01 PIMCO Long-Term U.S. Government Fund FUND CHARACTERISTICS Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily long-term maturity fixed income securities Duration: 11.0 years Total Net Assets: $481.0 million Sector Breakdown:* [GRAPH] U.S. Treasury Obligations 41.5% Mortgage-Backed Securities 39.0% U.S. Government Agencies 8.8% Other 10.7% Quality Breakdown:* [GRAPH] AAA 95.0% AA 2.3% A 2.7% *% of Total Investments as of March 31, 2001 PERFORMANCE TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001 Inst'l Class Admin. Class Lehman Lipper General (Incep. (Incep. Long-Term U.S. Government 7/01/1991) 9/23/1997) Treasury Index Fund Average -------------------------------------------------------------------------------- 1 Year 15.52% 15.24% 12.83% 11.41% 3 Years* 8.02% 7.75% 7.56% 5.84% 5 Years* 9.63% -- 9.09% 6.48% Since Inception* 11.28% 8.81% -- -- * Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] LONG-TERM U.S. GOVERNMENT FUND Long-Term U.S. Gov't Lehman Long-Term MONTH Fund Treasury Index -------------------------------------------------------------------------------- 06/30/1991 5,000,000 5,000,000 07/31/1991 5,068,858 5,074,501 08/31/1991 5,265,511 5,249,571 09/30/1991 5,442,627 5,414,932 10/31/1991 5,470,292 5,426,845 11/30/1991 5,543,810 5,457,236 12/31/1991 5,909,199 5,782,486 01/31/1992 5,742,566 5,600,917 02/29/1992 5,771,828 5,633,962 03/31/1992 5,753,678 5,571,988 04/30/1992 5,725,465 5,566,416 05/31/1992 5,930,074 5,721,163 06/30/1992 6,016,162 5,804,119 07/31/1992 6,300,744 6,045,570 08/31/1992 6,427,326 6,087,285 09/30/1992 6,540,767 6,183,464 10/31/1992 6,378,211 6,053,611 11/30/1992 6,445,336 6,076,615 12/31/1992 6,614,191 6,243,115 01/31/1993 6,790,743 6,421,044 02/28/1993 7,063,398 6,635,507 03/31/1993 7,101,318 6,652,095 04/30/1993 7,156,851 6,703,316 05/31/1993 7,184,508 6,725,437 06/30/1993 7,540,954 7,009,924 07/31/1993 7,650,608 7,122,783 08/31/1993 7,942,707 7,409,119 09/30/1993 7,968,888 7,435,051 10/31/1993 8,009,725 7,488,582 11/30/1993 7,792,708 7,296,874 12/31/1993 7,842,784 7,320,224 01/31/1994 8,022,521 7,495,910 02/28/1994 7,708,576 7,188,578 03/31/1994 7,394,709 6,873,000 04/30/1994 7,268,749 6,791,898 05/31/1994 7,246,140 6,747,072 06/30/1994 7,204,478 6,682,974 07/31/1994 7,383,601 6,909,528 08/31/1994 7,399,922 6,858,397 09/30/1994 7,169,097 6,642,358 10/31/1994 7,122,283 6,619,109 11/30/1994 7,100,894 6,658,162 12/31/1994 7,263,266 6,760,697 01/31/1995 7,453,074 6,934,447 02/28/1995 7,711,268 7,131,386 03/31/1995 7,801,463 7,192,715 04/30/1995 7,935,436 7,320,745 05/31/1995 8,543,447 7,882,247 06/30/1995 8,641,206 7,973,681 07/31/1995 8,492,085 7,846,101 08/31/1995 8,683,920 8,020,286 09/30/1995 8,871,163 8,167,858 10/31/1995 9,089,923 8,396,559 11/30/1995 9,313,423 8,606,473 12/31/1995 9,556,575 8,835,405 01/31/1996 9,571,589 8,835,405 02/29/1996 9,125,878 8,408,654 03/31/1996 8,958,506 8,241,322 04/30/1996 8,759,744 8,103,692 05/31/1996 8,771,139 8,061,553 06/30/1996 8,947,395 8,233,264 07/31/1996 8,918,333 8,236,557 08/31/1996 8,856,612 8,133,600 09/30/1996 9,102,968 8,358,088 10/31/1996 9,493,678 8,686,561 11/30/1996 9,851,090 8,976,691 12/31/1996 9,624,385 8,758,559 01/31/1997 9,576,361 8,696,373 02/28/1997 9,598,405 8,699,851 03/31/1997 9,359,770 8,477,135 04/30/1997 9,570,437 8,681,434 05/31/1997 9,684,481 8,778,666 06/30/1997 9,875,451 8,948,094 07/31/1997 10,424,177 9,473,347 08/31/1997 10,161,918 9,209,988 09/30/1997 10,427,124 9,463,263 10/31/1997 10,781,870 9,782,175 11/30/1997 10,884,053 9,912,278 12/31/1997 11,070,318 10,078,804 01/31/1998 11,276,193 10,283,404 02/28/1998 11,199,620 10,209,364 03/31/1998 11,253,545 10,230,803 04/30/1998 11,318,487 10,268,657 05/31/1998 11,539,028 10,464,788 06/30/1998 11,809,161 10,707,571 07/31/1998 11,801,731 10,662,600 08/31/1998 12,300,067 11,143,483 09/30/1998 12,791,270 11,551,334 10/31/1998 12,445,690 11,376,910 11/30/1998 12,490,607 11,464,511 12/31/1998 12,554,165 11,440,436 01/31/1999 12,649,540 11,543,400 02/28/1999 12,075,837 10,975,465 03/31/1999 12,126,451 10,950,221 04/30/1999 12,144,805 10,965,551 05/31/1999 11,926,288 10,793,392 06/30/1999 11,815,966 10,678,982 07/31/1999 11,748,078 10,627,723 08/31/1999 11,657,161 10,586,275 09/30/1999 11,776,658 10,664,613 10/31/1999 11,801,615 10,671,012 11/30/1999 11,726,960 10,598,449 12/31/1999 11,551,451 10,440,533 01/31/2000 11,604,071 10,589,832 02/29/2000 11,954,949 10,909,645 03/31/2000 12,278,865 11,282,755 04/30/2000 12,210,344 11,192,492 05/31/2000 12,145,217 11,152,200 06/30/2000 12,518,123 11,394,202 07/31/2000 12,744,020 11,590,183 08/31/2000 13,030,399 11,854,439 09/30/2000 12,879,831 11,711,000 10/31/2000 13,107,443 11,893,691 11/30/2000 13,541,214 12,269,532 12/31/2000 13,905,851 12,557,866 01/31/2001 13,986,307 12,579,214 02/28/2001 14,260,933 12,794,319 03/31/2001 14,184,611 12,730,348 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 7/01/1991, the Fund's Institutional Class inception date, compared to the Lehman Long-Term Treasury Index, an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annual basis. The Administrative Class commenced operations on 9/23/1997. PORTFOLIO INSIGHTS . The Long-Term U.S. Government Fund Institutional Class shares outperformed the benchmark Lehman Long-Term Treasury Index, returning 15.52% for the year ended March 31, 2001, compared to 12.83% for the Index. . Extending the Fund's duration was modestly positive for the year as interest rates generally trended downward. . A mortgage emphasis added to yearly returns as relatively high yields offset heightened market volatility. . Premiums from written options were positive as interest rates remained within our anticipated range. . Real return bonds added to relative returns, outperforming like-duration Treasuries as real yields fell. . Municipal bonds aided returns; municipals outpaced Treasuries as high tax-adjusted yields attracted strong retail demand. 3.31.01 | PIMCO Funds Annual Report 13 PIMCO Investment Grade Corporate Bond Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily corporate fixed income securities Duration: 5.8 years Total Net Assets: $5.8 million Sector Breakdown:* [GRAPH] Corporate Bonds & Notes 87.2% Other 12.8% Quality Breakdown:* [GRAPH] AA 6.8% A 29.8% BBB 57.6% BB 5.8% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Inst'l Class Lehman Brothers Credit Lipper Intermediate Investment (Incep. 4/28/2000) Investment Grade Index Grade Debt Fund Average --------------------------------------------------------------------------------------------------- 6 Months 8.54% 7.79% 6.87% Since Inception 15.00% -- --
CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] INVESTMENT GRADE CORPORATE BOND FUND Invest. Grade Lehman Brothers Credit Corp. Bond Investment Grade MONTH Fund Index -------------------------------------------------------------------------------- 04/30/2000 5,000,000 5,000,000 05/31/2000 5,014,761 4,981,500 06/30/2000 5,128,394 5,106,535 07/31/2000 5,184,004 5,168,324 08/31/2000 5,264,388 5,235,512 09/30/2000 5,297,559 5,263,260 10/31/2000 5,317,541 5,268,524 11/30/2000 5,424,989 5,337,015 12/31/2000 5,563,978 5,440,553 01/31/2001 5,642,326 5,589,624 02/28/2001 5,736,175 5,638,254 03/31/2001 5,749,969 5,673,211 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that Fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 5/01/2000, the first full month following the Fund's Institutional Class inception on 4/28/2000, compared to the Lehman Brothers Credit Investment Grade Index, an unmanaged market index. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The Investment Grade Corporate Bond Fund returned 12.12% for the nine months ended March 31, 2001 compared to 11.10% for the Lehman Brothers Credit Investment Grade Index. . An above-benchmark duration had a positive impact on returns as interest rates fell. . Underweighting consumer cyclicals added to returns as excess capacity and reduced demand caused this sector to underperform. . An overweight to transportation-related companies, especially Equipment Trust Certificates (ETCs), boosted returns as strong demand more-than-offset higher oil prices. . Limited exposure to high yield bonds was negative as this sector underperformed, despite a strong start in 2001. . A small allocation to mortgage-backed securities detracted slightly from returns as recent interest rate volatility caused this sector to underperform. 14 PIMCO Funds Annual Report | 3.31.01 PIMCO High Yield Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily higher yielding fixed income securities Duration: 3.7 years Total Net Assets: $2.6 billion Sector Breakdown:* [GRAPH] Corporate Bonds & Notes 76.2% Asset-Backed Securities 10.5% Short-Term Instruments 6.2% Other 7.1% Quality Breakdown:* [GRAPH] AAA 5.6% AA 1.1% A 2.1% BBB 14.4% BB 44.0% B 32.8% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Lehman Lipper High Inst'l Class Admin. Class Brothers BB U.S. Current Yield (Incep. 12/16/1992) (Incep. 1/16/1995) High Yield Index Fund Average ----------------------------------------------------------------------------------------------------- 1 Year 5.85% 5.59% 11.08% -3.20% 3 Years* 3.24% 2.99% 4.95% -2.07% 5 Years* 7.28% 7.01% 7.40% 3.77% Since Inception* 9.41% 8.89% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] HIGH YIELD FUND Lehman Brothers High Yield BB U.S. High Yield MONTH Fund Index -------------------------------------------------------------------------------- 12/31/1992 5,000,000 5,000,000 01/31/1993 5,113,886 5,105,500 02/28/1993 5,208,126 5,180,551 03/31/1993 5,313,333 5,239,092 04/30/1993 5,369,686 5,283,100 05/31/1993 5,409,077 5,322,195 06/30/1993 5,556,254 5,435,026 07/31/1993 5,595,567 5,489,919 08/31/1993 5,658,345 5,553,602 09/30/1993 5,686,689 5,594,144 10/31/1993 5,839,376 5,669,106 11/30/1993 5,884,380 5,683,845 12/31/1993 5,935,129 5,732,726 01/31/1994 6,061,596 5,828,463 02/28/1994 6,060,370 5,822,051 03/31/1994 5,879,246 5,643,896 04/30/1994 5,828,068 5,610,598 05/31/1994 5,870,524 5,615,648 06/30/1994 5,878,587 5,632,494 07/31/1994 5,934,013 5,701,210 08/31/1994 5,984,086 5,761,643 09/30/1994 6,025,467 5,772,015 10/31/1994 6,028,706 5,785,289 11/30/1994 6,004,787 5,745,950 12/31/1994 6,077,394 5,781,575 01/31/1995 6,137,436 5,874,658 02/28/1995 6,305,367 6,053,248 03/31/1995 6,397,464 6,110,148 04/30/1995 6,537,390 6,232,351 05/31/1995 6,727,023 6,415,582 06/30/1995 6,781,902 6,472,039 07/31/1995 6,872,762 6,530,935 08/31/1995 6,925,387 6,568,814 09/30/1995 7,022,543 6,639,758 10/31/1995 7,125,446 6,692,211 11/30/1995 7,212,331 6,776,533 12/31/1995 7,334,202 6,883,602 01/31/1996 7,453,084 6,995,117 02/29/1996 7,460,951 6,969,934 03/31/1996 7,402,000 6,933,691 04/30/1996 7,434,433 6,930,917 05/31/1996 7,459,688 6,940,621 06/30/1996 7,490,201 7,015,579 07/31/1996 7,557,060 7,053,463 08/31/1996 7,680,144 7,110,596 09/30/1996 7,858,765 7,263,475 10/31/1996 7,937,607 7,364,437 11/30/1996 8,110,110 7,513,198 12/31/1996 8,191,022 7,529,728 01/31/1997 8,275,049 7,601,259 02/28/1997 8,402,615 7,693,234 03/31/1997 8,292,841 7,601,685 04/30/1997 8,381,534 7,695,946 05/31/1997 8,572,658 7,827,547 06/30/1997 8,699,809 7,928,522 07/31/1997 8,924,236 8,164,792 08/31/1997 8,921,803 8,087,226 09/30/1997 9,072,091 8,214,195 10/31/1997 9,081,530 8,242,125 11/30/1997 9,168,890 8,299,819 12/31/1997 9,273,057 8,376,177 01/31/1998 9,432,639 8,476,692 02/28/1998 9,483,456 8,515,684 03/31/1998 9,557,939 8,570,184 04/30/1998 9,581,967 8,613,893 05/31/1998 9,631,622 8,669,883 06/30/1998 9,702,825 8,722,769 07/31/1998 9,806,262 8,768,128 08/31/1998 9,412,663 8,526,128 09/30/1998 9,532,027 8,706,882 10/31/1998 9,438,479 8,595,433 11/30/1998 9,836,791 8,801,724 12/31/1998 9,879,676 8,857,175 01/31/1999 10,010,006 8,948,403 02/28/1999 9,927,890 8,882,185 03/31/1999 10,010,332 8,946,137 04/30/1999 10,178,603 9,037,387 05/31/1999 9,984,753 8,928,036 06/30/1999 9,982,745 8,907,501 07/31/1999 10,010,514 8,941,350 08/31/1999 9,972,088 8,885,018 09/30/1999 9,978,381 8,921,448 10/31/1999 9,966,545 8,891,114 11/30/1999 10,104,777 8,966,688 12/31/1999 10,158,157 9,051,872 01/31/2000 10,112,740 8,987,604 02/29/2000 10,137,614 9,004,680 03/31/2000 9,935,905 8,919,136 04/30/2000 9,958,025 8,949,460 05/31/2000 9,908,672 8,953,039 06/30/2000 10,098,829 9,146,423 07/31/2000 10,178,729 9,298,253 08/31/2000 10,325,854 9,441,446 09/30/2000 10,294,967 9,395,182 10/31/2000 10,085,655 9,253,315 11/30/2000 9,895,109 9,205,199 12/31/2000 10,113,001 9,389,302 01/31/2001 10,530,435 9,734,828 02/28/2001 10,642,311 9,874,037 03/31/2001 10,517,025 9,907,609 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 1/01/1993, the first full month following the Fund's Institutional Class inception on 12/16/1992, compared to the Lehman Brothers BB U.S. High Yield Index, an unmanaged market index, formally known as Lehman Intermediate BB rated Corporate Index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 1/16/1995. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. The investments made by the High Yield Fund may involve high risk and may have speculative characteristics. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The High Yield Fund Institutional Class shares returned 5.85% for the annual period ended March 31, 2001 compared to 11.08% for the Lehman Brothers BB U.S. High Yield Index. . The Fund's exposure to B rated issues detracted from performance as B rated issues significantly underperformed BBs. . An overweight in telecoms was negative as this sector underperformed the broader market. Limited exposure to the lower quality tier of this sector helped mitigate the impact on performance. . A focus on non-cyclical companies such as healthcare and utilities added to performance as the U.S economy has begun to show signs of a slowdown in growth. . Avoiding basic materials and retail issues helped relative performance as these sectors were adversely effected by excess capacity and a reduction in consumer and investment demand. . Significant credit deterioration and subsequent default of Safety-Kleen Corp., one of the Fund's larger holdings, negatively impacted performance as the company is currently being investigated for accounting fraud. 3.31.01 | PIMCO Funds Annual Report 15 PIMCO Total Return Mortgage Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily intermediate maturity mortgage-related fixed income securities Duration: 3.2 years Total Net Assets: $25.1 million Sector Breakdown:* [GRAPH] Mortgage-Backed Securities 83.4% Short-Term Instruments 15.3% Other 1.3% Quality Breakdown:* [GRAPH] AAA 97.1% AA 2.9% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Inst'l Class Lehman Brothers Lipper U.S. Mortgage (Incep. 7/31/1997) Mortgage Index Fund Average ----------------------------------------------------------------------------------------- 1 Year 13.14% 12.64% 11.48% 3 Years* 7.70% 6.97% 6.08% Since Inception* 8.15% -- --
*Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] TOTAL RETURN MORTGAGE FUND Total Return Lehman Brothers Mortgage Mortgage MONTH Fund Index -------------------------------------------------------------------------------- 07/31/1997 5,000,000 5,000,000 08/31/1997 5,005,044 4,988,118 09/30/1997 5,084,467 5,051,382 10/31/1997 5,160,309 5,107,387 11/30/1997 5,184,726 5,124,151 12/31/1997 5,246,122 5,170,844 01/31/1998 5,304,038 5,222,289 02/28/1998 5,314,354 5,233,336 03/31/1998 5,334,652 5,255,495 04/30/1998 5,371,139 5,285,232 05/31/1998 5,417,855 5,320,364 06/30/1998 5,453,983 5,345,733 07/31/1998 5,476,124 5,372,837 08/31/1998 5,542,715 5,421,585 09/30/1998 5,605,738 5,487,033 10/31/1998 5,584,293 5,479,968 11/30/1998 5,609,572 5,507,264 12/31/1998 5,625,826 5,530,643 01/31/1999 5,660,727 5,570,014 02/28/1999 5,631,600 5,547,984 03/31/1999 5,669,090 5,585,236 04/30/1999 5,697,656 5,610,991 05/31/1999 5,667,354 5,579,648 06/30/1999 5,661,901 5,559,994 07/31/1999 5,641,744 5,522,293 08/31/1999 5,639,123 5,522,100 09/30/1999 5,717,073 5,611,697 10/31/1999 5,745,364 5,644,003 11/30/1999 5,773,781 5,647,086 12/31/1999 5,762,288 5,633,277 01/31/2000 5,725,332 5,584,465 02/29/2000 5,812,378 5,649,206 03/31/2000 5,890,936 5,710,992 04/30/2000 5,871,241 5,714,910 05/31/2000 5,868,917 5,717,543 06/30/2000 5,978,903 5,839,767 07/31/2000 6,038,508 5,877,275 08/31/2000 6,138,873 5,966,358 09/30/2000 6,201,183 6,028,208 10/31/2000 6,244,656 6,071,497 11/30/2000 6,345,742 6,162,828 12/31/2000 6,468,116 6,262,059 01/31/2001 6,570,212 6,359,555 02/28/2001 6,632,002 6,395,972 03/31/2001 6,664,904 6,433,095 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 7/31/1997, the Fund's Institutional Class inception date, compared to the Lehman Brothers Mortgage Index, an unmanaged market index. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The Total Return Mortgage Fund returned 13.14% for the year ended March 31, 2001, outperforming the Lehman Brothers Mortgage Index, which returned 12.64% for the same period. . The portfolio maintained a slightly higher duration than the Index, which added to returns as interest rates fell during the period. . Greater than Index exposure to Government National Mortgage Association securities hurt relative returns as market concerns that the federal government would restrict the activities of the Federal Home Loan Mortgage Corp. and the Federal National Mortgage Association dissipated causing these sectors of the market to perform well. 16 PIMCO Funds Annual Report | 3.31.01 PIMCO GNMA Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily short and intermediate maturity mortgage-related fixed income securities issued by the Government National Mortgage Association Duration: 3.5 years Total Net Assets: $10.0 million Sector Breakdown:* [GRAPH] Mortgage-Backed Securities 57.7% U.S. Treasury Obligations 19.4% Asset-Backed Securities 11.4% Short-Term Instruments 8.3% Other 3.2% Quality Breakdown:* [GRAPH] AAA 85.2% AA 5.3% A 6.0% BBB 3.5% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Inst'l Class Merrill Lynch 1-3 Lehman Brothers Lipper U.S. Mortgage (Incep. 7/31/1997) Year Treasury Index GNMA Index Fund Average ----------------------------------------------------------------------------------------------------------- 1 Year 12.96% 9.60% 11.93% 11.48% 3 Years* 7.89% 6.44% 6.96% 6.08% Since Inception* 8.07% -- -- --
*Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] GNMA FUND Merrill Lynch Lehman Brothers 1-3 Year MONTH GNMA Fund GNMA Index Treasury Index -------------------------------------------------------------------------------- 07/31/1997 5,000,000 5,000,000 5,000,000 08/31/1997 5,018,286 4,989,337 5,004,600 09/30/1997 5,111,651 5,055,583 5,042,585 10/31/1997 5,159,820 5,108,308 5,080,051 11/30/1997 5,172,284 5,123,990 5,092,396 12/31/1997 5,218,267 5,170,241 5,127,177 01/31/1998 5,260,371 5,220,145 5,176,962 02/28/1998 5,285,796 5,231,813 5,181,414 03/31/1998 5,293,096 5,253,935 5,202,503 04/30/1998 5,311,809 5,284,438 5,226,850 05/31/1998 5,351,927 5,320,546 5,254,709 06/30/1998 5,392,191 5,342,972 5,282,034 07/31/1998 5,408,563 5,373,010 5,306,753 08/31/1998 5,477,311 5,415,391 5,373,459 09/30/1998 5,543,973 5,479,473 5,444,658 10/31/1998 5,519,699 5,474,726 5,471,391 11/30/1998 5,498,845 5,505,690 5,466,631 12/31/1998 5,536,600 5,528,299 5,485,929 01/31/1999 5,578,414 5,567,556 5,507,652 02/28/1999 5,528,744 5,549,893 5,480,775 03/31/1999 5,595,411 5,583,509 5,518,867 04/30/1999 5,622,757 5,610,300 5,536,637 05/31/1999 5,662,331 5,582,000 5,533,094 06/30/1999 5,653,531 5,559,755 5,550,357 07/31/1999 5,659,351 5,523,329 5,567,952 08/31/1999 5,658,931 5,521,445 5,584,043 09/30/1999 5,722,084 5,610,299 5,620,339 10/31/1999 5,740,102 5,643,667 5,635,290 11/30/1999 5,736,548 5,646,093 5,645,940 12/31/1999 5,694,838 5,634,755 5,654,014 01/31/2000 5,747,671 5,583,844 5,651,922 02/29/2000 5,792,796 5,655,255 5,689,564 03/31/2000 5,884,367 5,744,636 5,724,839 04/30/2000 5,873,635 5,739,574 5,739,723 05/31/2000 5,882,556 5,760,408 5,763,314 06/30/2000 5,950,810 5,866,692 5,823,137 07/31/2000 5,991,510 5,897,650 5,859,939 08/31/2000 6,047,328 5,986,789 5,903,126 09/30/2000 6,090,882 6,042,466 5,945,511 10/31/2000 6,147,435 6,087,180 5,977,438 11/30/2000 6,286,860 6,173,009 6,033,985 12/31/2000 6,355,420 6,260,666 6,105,971 01/31/2001 6,457,728 6,362,715 6,182,478 02/28/2001 6,575,949 6,391,347 6,222,664 03/31/2001 6,647,112 6,429,695 6,274,562 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the invest- ment of $5,000,000 on 7/31/1997, the Fund's Institutional Class inception date, compared to the Merrill Lynch 1-3 Year Treasury Index and the Lehman Brothers GNMA Index, each an unmanaged market index. We will no longer compare the Fund to the Merrill Lynch 1-3 Year Treasury Index since the Merrill Lynch 1-3 Year Treasury Index is not a comparable GNMA index. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The GNMA Fund returned 12.96% for the year ended March 31, 2001, outperforming the Lehman Brothers GNMA Index, which returned 11.93% for the same period. . The portfolio maintained a slightly higher duration than the Index, which added to returns as interest rates fell during the period. . Positions in inflation protected securities helped returns as real rates fell during the year. . Limited exposure to CMO securities helped returns due to good demand and limited production of these types of securities. 3.31.01 | PIMCO Funds Annual Report 17 PIMCO Real Return Bond Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum real return, consistent with preservation of real capital and prudent investment management Portfolio: Primarily inflation-indexed fixed income securities Duration: 2.0 years Total Net Assets: $899.1 million Sector Breakdown:* [GRAPH] U.S. Treasury Obligations 62.2% Corporate Bonds & Notes 20.6% Short-Term Instruments 11.9% Other 5.3% Quality Breakdown:* [GRAPH] AAA 76.5% AA 7.1% A 8.0% BBB 5.0% BB 3.1% B 0.3% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Lehman Brothers Lipper Short U.S. Inst'l Class Admin. Class Inflation Linked Government (Incep. 1/29/1997) (Incep. 4/28/2000) Treasury Index Fund Average -------------------------------------------------------------------------------------------------------------- 1 Year 14.44% -- 13.70% 9.16% 3 Years* 9.69% -- 7.94% 5.85% Since Inception 8.09%* 12.70% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] REAL RETURN BOND FUND Lehman Brothers Real Return Inflation Linked MONTH Bond Fund Treasury Index -------------------------------------------------------------------------------- 01/31/1997 5,000,000 5,000,000 02/28/1997 5,017,061 5,016,499 03/31/1997 4,971,983 4,947,776 04/30/1997 5,002,809 4,977,955 05/31/1997 5,032,748 5,004,838 06/30/1997 5,021,938 4,988,823 07/31/1997 5,083,742 5,036,214 08/31/1997 5,094,469 5,051,322 09/30/1997 5,104,457 5,061,426 10/31/1997 5,169,085 5,113,556 11/30/1997 5,196,006 5,142,195 12/31/1997 5,169,329 5,120,599 01/31/1998 5,199,466 5,145,691 02/28/1998 5,193,833 5,141,057 03/31/1998 5,205,501 5,138,489 04/30/1998 5,233,211 5,157,501 05/31/1998 5,254,770 5,194,120 06/30/1998 5,272,877 5,207,097 07/31/1998 5,313,726 5,231,257 08/31/1998 5,317,549 5,243,132 09/30/1998 5,441,195 5,348,519 10/31/1998 5,469,946 5,360,284 11/30/1998 5,461,835 5,354,923 12/31/1998 5,438,790 5,322,793 01/31/1999 5,518,587 5,384,539 02/28/1999 5,505,806 5,346,309 03/31/1999 5,538,991 5,344,703 04/30/1999 5,630,484 5,379,950 05/31/1999 5,671,234 5,417,047 06/30/1999 5,664,215 5,420,299 07/31/1999 5,674,126 5,417,586 08/31/1999 5,703,057 5,426,798 09/30/1999 5,727,393 5,447,965 10/31/1999 5,738,633 5,458,858 11/30/1999 5,783,160 5,492,160 12/31/1999 5,749,871 5,448,219 01/31/2000 5,784,298 5,472,738 02/29/2000 5,826,798 5,523,636 03/31/2000 6,002,905 5,684,369 04/30/2000 6,079,127 5,759,975 05/31/2000 6,062,274 5,744,998 06/30/2000 6,143,456 5,817,382 07/31/2000 6,192,132 5,867,107 08/31/2000 6,251,051 5,910,524 09/30/2000 6,302,775 5,941,257 10/31/2000 6,370,226 6,013,147 11/30/2000 6,463,907 6,100,339 12/31/2000 6,524,893 6,166,219 01/31/2001 6,691,996 6,295,097 02/28/2001 6,816,461 6,401,481 03/31/2001 6,869,744 6,462,938 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 2/01/1997, the first full month following the Fund' s Institutional Class inception date on 1/29/1997, compared to the Lehman Brothers Inflation Linked Treasury Index, an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 4/28/2000. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . For the year ended March 31, 2001, the Fund's Institutional Class shares returned 14.44%, outperforming the 13.70% return of the Fund's benchmark, the Lehman Brothers Inflation Linked Treasury Index. . The Fund's effective duration was 2.0 years at March 31, 2001, or 0.2 years above that of the Fund's benchmark. . Real yields declined by an average of 0.80% over the fiscal year with short and intermediate maturity real yields declining more than long-term real yields. Slower U.S. growth and the Fed's rate cuts in the latter part of the fiscal year contributed to real yield declines. . The breakeven yield differential, measuring the difference between a similar maturity conventional Treasury and a Treasury Inflation Protected Security (TIPS), dropped over the fiscal year to only 1.6% for 10-year maturities while CPI-U increased by 2.9% over the same period. . The effective duration of the Fund was managed on average to be above that of the benchmark, which had a positive effect on performance. . An overweight of intermediate maturities helped relative returns as real yields decreased more for intermediate maturities than for longer maturities. . The Fund's portfolio yield was enhanced through the use of cash-backing strategies, employing short duration, high quality corporate and asset-backed securities in conjunction with TIPS buy-forward contracts. . The Fund gained above-benchmark exposures to inflation adjustments, which benefited performance as the CPI-U increased more than expected. . Real yields at March 31, 2001 were 3.29% for 10-year maturities and 3.50% for 30-year maturities. 18 PIMCO Funds Annual Report | 3.31.01 PIMCO Foreign Bond Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily intermediate maturity, hedged non-U.S. fixed income securities Duration: 6.0 years Total Net Assets: $674.8 million Country Allocation:* [GRAPH] United States 40.5% Germany 11.9% Italy 9.4% France 6.6% Canada 6.0% Short-Term Instruments 6.6% Other 19.0% Quality Breakdown:* [GRAPH] AAA 67.4% AA 21.1% A 4.9% BBB 3.9% BB 2.7% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Inst'l Class Admin. Class J.P. Morgan Non-U.S. Lipper International (Incep. 12/03/1992) (Incep. 1/28/1997) Index (Hedged) Income Fund Average ------------------------------------------------------------------------------------------------------------ 1 Year 11.34% 11.06% 10.36% 0.00% 3 Years* 7.00% 6.74% 7.91% 1.71% 5 Years* 10.19% -- 9.92% 2.82% Since Inception* 9.91% 7.58% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] FOREIGN BOND FUND J.P. Morgan Foreign Non-U.S. Index MONTH Bond Fund (Hedged) -------------------------------------------------------------------------------- 12/31/1992 5,000,000 5,000,000 01/31/1993 5,041,660 5,045,501 02/28/1993 5,152,513 5,136,826 03/31/1993 5,171,807 5,139,908 04/30/1993 5,171,804 5,140,421 05/31/1993 5,218,564 5,169,209 06/30/1993 5,342,019 5,274,661 07/31/1993 5,426,186 5,333,737 08/31/1993 5,558,061 5,444,678 09/30/1993 5,580,127 5,468,090 10/31/1993 5,663,151 5,540,815 11/30/1993 5,679,152 5,579,601 12/31/1993 5,820,067 5,695,098 01/31/1994 5,827,680 5,666,624 02/28/1994 5,673,113 5,539,124 03/31/1994 5,574,498 5,488,718 04/30/1994 5,522,099 5,449,747 05/31/1994 5,441,127 5,389,254 06/30/1994 5,340,992 5,334,283 07/31/1994 5,374,816 5,369,488 08/31/1994 5,322,015 5,317,942 09/30/1994 5,330,821 5,322,728 10/31/1994 5,351,402 5,343,487 11/30/1994 5,430,650 5,418,829 12/31/1994 5,395,132 5,406,367 01/31/1995 5,431,819 5,465,297 02/28/1995 5,467,726 5,535,800 03/31/1995 5,471,621 5,648,728 04/30/1995 5,605,512 5,738,544 05/31/1995 5,825,529 5,926,769 06/30/1995 5,790,386 5,907,210 07/31/1995 5,900,948 5,981,642 08/31/1995 6,013,433 6,033,680 09/30/1995 6,099,110 6,129,012 10/31/1995 6,201,268 6,197,659 11/30/1995 6,444,451 6,333,387 12/31/1995 6,540,017 6,392,287 01/31/1996 6,700,408 6,469,635 02/29/1996 6,557,601 6,393,293 03/31/1996 6,664,336 6,446,357 04/30/1996 6,825,851 6,523,713 05/31/1996 6,852,155 6,568,075 06/30/1996 6,930,027 6,622,589 07/31/1996 6,997,369 6,672,259 08/31/1996 7,169,036 6,761,000 09/30/1996 7,370,202 6,905,010 10/31/1996 7,552,295 7,018,941 11/30/1996 7,735,101 7,159,321 12/31/1996 7,775,388 7,169,345 01/31/1997 7,899,810 7,258,963 02/28/1997 7,942,561 7,305,419 03/31/1997 7,843,570 7,266,703 04/30/1997 7,917,253 7,345,183 05/31/1997 7,958,788 7,383,378 06/30/1997 8,118,878 7,508,894 07/31/1997 8,239,266 7,628,287 08/31/1997 8,206,198 7,637,441 09/30/1997 8,383,475 7,772,623 10/31/1997 8,286,145 7,822,367 11/30/1997 8,398,755 7,878,689 12/31/1997 8,522,040 7,981,113 01/31/1998 8,645,607 8,087,245 02/28/1998 8,725,510 8,159,239 03/31/1998 8,835,222 8,231,855 04/30/1998 8,865,827 8,273,838 05/31/1998 8,942,528 8,387,190 06/30/1998 8,987,048 8,423,255 07/31/1998 9,130,620 8,501,590 08/31/1998 9,058,201 8,669,071 09/30/1998 9,266,649 8,874,530 10/31/1998 9,075,582 8,861,217 11/30/1998 9,245,824 8,956,919 12/31/1998 9,377,213 8,946,169 01/31/1999 9,569,644 9,057,102 02/28/1999 9,476,423 8,996,420 03/31/1999 9,534,902 9,103,477 04/30/1999 9,658,589 9,219,091 05/31/1999 9,507,394 9,181,293 06/30/1999 9,391,681 9,038,983 07/31/1999 9,396,468 9,015,482 08/31/1999 9,329,165 9,031,709 09/30/1999 9,379,607 9,066,031 10/31/1999 9,422,198 9,087,790 11/30/1999 9,440,689 9,140,496 12/31/1999 9,524,187 9,167,918 01/31/2000 9,475,484 9,168,837 02/29/2000 9,584,349 9,236,684 03/31/2000 9,722,350 9,371,538 04/30/2000 9,756,895 9,422,144 05/31/2000 9,815,858 9,497,520 06/30/2000 9,890,070 9,543,107 07/31/2000 9,973,457 9,611,817 08/31/2000 9,963,948 9,613,739 09/30/2000 10,095,126 9,696,417 10/31/2000 10,121,158 9,774,958 11/30/2000 10,271,406 9,947,974 12/31/2000 10,463,562 10,058,396 01/31/2001 10,619,334 10,177,679 02/28/2001 10,680,403 10,265,125 03/31/2001 10,824,425 10,342,598 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the invest- ment of $5,000,000 on 1/01/1993, the first full month following the Fund's Institutional Class inception on 12/03/1992, compared to the J.P. Morgan Non-U.S. Index (Hedged), an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 1/28/1997. Foreign investing involves potentially higher risks including foreign currency fluctuations and political or economic uncertainty. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . For the year ended March 31, 2001, the Foreign Bond Fund Institutional Class shares posted a return of 11.34%, outperforming the 10.36% return of the Fund's benchmark, the J.P. Morgan Non-U.S. Index (Hedged). . Extending portfolio duration added to returns as yields fell worldwide amid a slowdown in global growth. A portion of the portfolio's overweight duration was focused in core Europe and these bonds rallied as Europe felt the impact of the U.S.-led slowdown. . An underweight in Japan was negative. Japanese yields fell due to a weak economy, continued domestic support and a return to zero short-term rates. . Real return bonds added to relative returns, outperforming like-duration government bonds as real yields fell worldwide. . An overweight in the euro was negative. The euro fell despite improving growth relative to the U.S. Later in the year, concern that the ECB would keep short-term rates too high, limiting growth prospects, weighed heavily on the euro. . Emerging market holdings were slightly positive as we avoided problem credits such as Turkey and Argentina. . An underweight in Hong Kong versus the U.S. added to returns after heightened concerns about fixed currency regimes caused Hong Kong yields to rise. 3.31.01 | PIMCO Funds Annual Report 19 PIMCO Global Bond Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily U.S. and non-U.S. intermediate maturity fixed income securities Duration: 8.3 years Total Net Assets: $309.8 million Country Allocation:* [GRAPH] United States 50.0% Italy 8.8% Germany 8.7% United Kingdom 6.0% Short-Term Instruments 2.5% Other 24.0% Quality Breakdown:* [GRAPH] AAA 67.1% AA 20.0% A 6.8% BBB 3.1% BB 3.0% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
J.P. Morgan Inst'l Class Admin. Class Global Index Lipper Global Income (Incep. 11/23/1993) (Incep. 8/01/1996) (Unhedged) Fund Average --------------------------------------------------------------------------------------------------------- 1 Year -0.83% -1.07% -0.94% 2.75% 3 Years* 1.35% 1.14% 2.53% 1.74% 5 Years* 3.31% -- 3.24% 4.05% Since Inception* 5.24% 2.55% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] GLOBAL BOND FUND J.P. Morgan Global Bond Global Index MONTH Fund (Unhedged) -------------------------------------------------------------------------------- 11/30/1993 5,000,000 5,000,000 12/31/1993 5,159,354 5,051,001 01/31/1994 5,172,612 5,098,479 02/28/1994 5,050,687 5,042,396 03/31/1994 4,981,799 5,019,201 04/30/1994 4,983,396 5,015,186 05/31/1994 4,957,155 4,973,560 06/30/1994 4,993,232 5,032,746 07/31/1994 5,040,972 5,080,054 08/31/1994 5,023,423 5,066,846 09/30/1994 5,045,769 5,091,673 10/31/1994 5,117,441 5,168,048 11/30/1994 5,070,101 5,102,929 12/31/1994 5,071,554 5,114,666 01/31/1995 5,158,706 5,217,982 02/28/1995 5,306,429 5,352,606 03/31/1995 5,497,439 5,625,054 04/30/1995 5,586,069 5,714,492 05/31/1995 5,774,015 5,873,926 06/30/1995 5,791,402 5,910,344 07/31/1995 5,833,592 5,938,122 08/31/1995 5,749,603 5,773,043 09/30/1995 5,839,678 5,902,936 10/31/1995 5,966,446 5,960,786 11/30/1995 6,121,956 6,027,545 12/31/1995 6,236,009 6,102,287 01/31/1996 6,250,544 6,039,434 02/29/1996 6,152,157 6,004,405 03/31/1996 6,159,100 5,995,399 04/30/1996 6,210,796 5,973,217 05/31/1996 6,191,536 5,979,190 06/30/1996 6,265,488 6,031,208 07/31/1996 6,379,395 6,142,182 08/31/1996 6,491,924 6,167,980 09/30/1996 6,584,759 6,201,904 10/31/1996 6,764,325 6,324,702 11/30/1996 6,923,739 6,415,146 12/31/1996 6,879,967 6,370,239 01/31/1997 6,702,769 6,210,983 02/28/1997 6,656,620 6,168,128 03/31/1997 6,576,929 6,121,249 04/30/1997 6,536,080 6,086,970 05/31/1997 6,699,780 6,230,622 06/30/1997 6,783,140 6,301,651 07/31/1997 6,758,684 6,278,337 08/31/1997 6,721,424 6,270,802 09/30/1997 6,895,854 6,410,014 10/31/1997 6,891,415 6,545,905 11/30/1997 6,834,927 6,467,355 12/31/1997 6,817,845 6,460,241 01/31/1998 6,851,128 6,524,843 02/28/1998 6,915,929 6,573,126 03/31/1998 6,961,654 6,523,829 04/30/1998 7,063,593 6,624,295 05/31/1998 7,059,363 6,652,780 06/30/1998 7,070,889 6,671,407 07/31/1998 7,130,372 6,689,420 08/31/1998 7,124,542 6,874,048 09/30/1998 7,491,180 7,232,874 10/31/1998 7,509,415 7,394,889 11/30/1998 7,456,893 7,311,327 12/31/1998 7,669,954 7,448,780 01/31/1999 7,718,892 7,387,701 02/28/1999 7,459,185 7,140,951 03/31/1999 7,441,983 7,158,805 04/30/1999 7,454,117 7,156,657 05/31/1999 7,250,125 7,030,699 06/30/1999 7,143,749 6,913,286 07/31/1999 7,296,476 7,065,380 08/31/1999 7,283,484 7,083,750 09/30/1999 7,400,295 7,185,754 10/31/1999 7,405,937 7,177,131 11/30/1999 7,291,664 7,091,723 12/31/1999 7,341,262 7,071,158 01/31/2000 7,098,375 6,931,857 02/29/2000 7,116,716 6,897,197 03/31/2000 7,307,538 7,097,904 04/30/2000 7,080,709 6,882,129 05/31/2000 7,153,212 6,932,368 06/30/2000 7,318,062 7,100,825 07/31/2000 7,239,595 6,989,341 08/31/2000 7,170,776 6,939,019 09/30/2000 7,191,731 6,925,141 10/31/2000 7,079,209 6,842,732 11/30/2000 7,190,025 6,984,374 12/31/2000 7,372,837 7,235,812 01/31/2001 7,432,281 7,230,820 02/28/2001 7,435,644 7,233,112 03/31/2001 7,247,001 7,031,526 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the invest- ment of $5,000,000 on 12/01/1993, the first full month following the Fund's Institutional Class inception on 11/23/1993, compared to the J.P. Morgan Global Index (Unhedged), an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 8/01/1996. Foreign investing involves potentially higher risks including foreign currency fluctuations and political or economic uncertainty. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The Global Bond Fund Institutional Class shares returned -0.83% for the one-year period ended March 31, 2001, outperforming the -0.94% return of the J.P. Morgan Global Index (Unhedged). . Extending portfolio duration added to returns as yields fell worldwide amid a slowdown in global growth. A portion of the portfolio's overweight duration was focused in core Europe and these bonds rallied as Europe felt the impact of the U.S.-led slowdown. . An underweight in Japan was negative. Japanese yields fell due to a weak economy, continued domestic support and a return to zero short-term rates. . A Canadian underweight versus the U.S. aided returns as Canadian rates fell less than U.S. rates. . An underweight in U.K. versus an overweight in Germany added to returns as the U.K. bonds underperformed Germany after the U.K. government ended restrictions requiring pension funds to hold government bonds. . Real return bonds added to relative returns, outperforming like-duration government bonds as real yields fell worldwide. . Holdings of Equitable Life detracted from returns after the company ceased operations following an unfavorable court decision and failure to find a buyer. . An overweight in the euro was negative. The euro fell despite improving growth relative to the U.S. Later in the year, concern that the ECB would keep short-term rates too high, limiting growth prospects, weighed heavily on the euro. . Emerging market holdings were slightly positive as we avoided problem credits such as Turkey and Argentina. . An underweight in Hong Kong versus the U.S. added to returns after heightened concerns about fixed currency regimes caused Hong Kong yields to rise. 20 PIMCO Funds Annual Report | 3.31.01 PIMCO Global Bond Fund II -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with preservation of capital Portfolio: Primarily U.S. and hedged non-U.S. intermediate maturity fixed income securities Duration: 6.7 years Total Net Assets: $76.1 million Country Allocation:* [GRAPH] United States 43.5% Germany 12.3% Italy 10.5% United Kingdom 6.4% Canada 5.5% Short-Term Instruments 2.4% Others 19.4% Quality Breakdown:* [GRAPH] AAA 70.0% AA 19.5% A 4.6% BBB 3.4% BB 2.5% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PORTFOLIO CHARACTERISTICS -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Inst'l Class J.P. Morgan Global Lipper Global Income (Incep. 2/25/1998) Index (Hedged) Fund Average ------------------------------------------------------------------------------------- 1 Year 11.87% 10.85% 2.75% 3 Years* 6.26% 7.65% 1.74% Since Inception* 6.58% -- --
*Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] GLOBAL BOND FUND II J.P. Morgan MONTH Global Bond Global Index Fund II (Hedged) -------------------------------------------------------------------------------- 02/28/1998 5,000,000 5,000,000 03/31/1998 5,069,096 5,032,502 04/30/1998 5,092,746 5,057,159 05/31/1998 5,121,536 5,120,376 06/30/1998 5,146,064 5,157,242 07/31/1998 5,210,272 5,190,249 08/31/1998 5,156,019 5,308,584 09/30/1998 5,273,043 5,443,954 10/31/1998 5,187,282 5,431,977 11/30/1998 5,256,161 5,470,545 12/31/1998 5,303,609 5,470,545 01/31/1999 5,422,839 5,525,796 02/28/1999 5,341,215 5,451,750 03/31/1999 5,376,152 5,501,909 04/30/1999 5,429,327 5,553,624 05/31/1999 5,347,551 5,520,302 06/30/1999 5,283,537 5,457,923 07/31/1999 5,279,879 5,446,462 08/31/1999 5,257,452 5,452,452 09/30/1999 5,285,083 5,480,262 10/31/1999 5,300,795 5,491,222 11/30/1999 5,294,352 5,509,892 12/31/1999 5,318,774 5,510,442 01/31/2000 5,296,692 5,514,850 02/29/2000 5,360,260 5,570,552 03/31/2000 5,435,868 5,663,021 04/30/2000 5,444,990 5,677,180 05/31/2000 5,465,049 5,710,672 06/30/2000 5,525,868 5,760,353 07/31/2000 5,572,330 5,807,011 08/31/2000 5,588,099 5,833,723 09/30/2000 5,653,061 5,869,310 10/31/2000 5,670,166 5,920,372 11/30/2000 5,738,619 6,032,269 12/31/2000 5,808,435 6,114,309 01/31/2001 5,933,174 6,178,353 02/28/2001 5,987,239 6,238,623 03/31/2001 6,081,194 6,277,271 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the invest- ment of $5,000,000 on 3/01/1998, the first full month following the Fund's Institutional Class inception on 2/25/1998, compared to the J.P. Morgan Global Index (Hedged), an unmanaged market index. Foreign investing involves potentially higher risks including foreign currency fluctuations and political or economic uncertainty. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . For the one-year period ended March 31, 2001, the Global Bond Fund II Institutional Class shares posted a return of 11.87%, outperforming the 10.85% return of the J.P. Morgan Global Index (Hedged). . Extending portfolio duration added to returns as yields fell worldwide amid a slowdown in global growth. A portion of the portfolio's overweight duration was focused in core Europe and these bonds rallied as Europe felt the impact of the U.S.-led slowdown. . An underweight in Japan was negative. Japanese yields fell due to a weak economy, continued domestic support and a return to zero short-term rates. . A Canadian underweight versus the U.S. aided returns as Canadian rates fell less than U.S. rates. . Real return bonds added to relative returns, outperforming like-duration government bonds as real yields fell worldwide. . An overweight in the euro was negative. The euro fell despite improving growth relative to the U.S. Later in the year, concern that the ECB would keep short-term rates too high, limiting growth prospects, weighed heavily on the euro. . Holdings of Equitable Life detracted from returns after the company ceased operations following an unfavorable court decision and failure to find a buyer. . Emerging market holdings were slightly positive as we avoided problem credits such as Turkey and Argentina. . An underweight in Hong Kong versus the U.S. added to returns after heightened concerns about fixed currency regimes caused Hong Kong yields to rise. 3.31.01 | PIMCO Funds Annual Report 21 PIMCO Emerging Markets Bond Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Primarily emerging market fixed income securities Duration: 5.0 years Total Net Assets: $57.6 million Country Allocation:* [GRAPH] Brazil 28.7% Mexico 19.8% Russia 13.2% Venezuela 5.8% Short-Term Instruments 5.1% Other 27.4% Quality Breakdown:* [GRAPH] AAA 4.9% AA 1.1% BBB 41.6% BB 43.7% B 8.7% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
J.P. Morgan Inst'l Class Admin. Class Emerging Markets Lipper Emerging Markets (Incep. 7/31/1997) (Incep. 9/30/1998) Bond Index Plus Debt Fund Average ------------------------------------------------------------------------------------------------------------ 1 Year 12.94% 12.65% 9.65% 5.22% 3 Years* 8.10% -- 6.57% 1.82% Since Inception* 7.47% 23.47% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] EMERGING MARKETS BOND FUND Emerging J.P. Morgan Markets Emerging Markets MONTH Bond Fund Bond Index Plus -------------------------------------------------------------------------------- 07/31/1997 5,000,000 5,000,000 08/31/1997 4,941,202 4,979,763 09/30/1997 5,077,992 5,132,145 10/31/1997 4,500,427 4,540,921 11/30/1997 4,738,197 4,756,615 12/31/1997 4,859,660 4,920,720 01/31/1998 4,866,472 4,910,880 02/28/1998 5,005,158 5,051,329 03/31/1998 5,155,188 5,177,076 04/30/1998 5,168,205 5,189,638 05/31/1998 5,002,060 5,012,513 06/30/1998 4,838,082 4,867,654 07/31/1998 4,912,199 4,901,240 08/31/1998 3,543,793 3,492,624 09/30/1998 3,819,422 3,834,203 10/31/1998 4,019,347 4,082,276 11/30/1998 4,340,414 4,322,720 12/31/1998 4,288,256 4,214,652 01/31/1999 4,139,443 4,058,290 02/28/1999 4,222,136 4,116,729 03/31/1999 4,507,995 4,428,365 04/30/1999 4,883,959 4,730,823 05/31/1999 4,578,472 4,461,166 06/30/1999 4,716,852 4,660,580 07/31/1999 4,686,777 4,564,104 08/31/1999 4,679,209 4,557,715 09/30/1999 4,888,898 4,716,781 10/31/1999 5,046,834 4,898,847 11/30/1999 5,183,471 5,037,484 12/31/1999 5,427,907 5,310,012 01/31/2000 5,308,344 5,204,876 02/29/2000 5,622,784 5,540,069 03/31/2000 5,765,699 5,714,579 04/30/2000 5,656,677 5,605,431 05/31/2000 5,546,802 5,462,491 06/30/2000 5,808,164 5,739,437 07/31/2000 5,949,537 5,912,770 08/31/2000 6,158,003 6,121,489 09/30/2000 6,076,985 6,038,429 10/31/2000 5,975,644 5,902,377 11/30/2000 6,006,990 5,872,276 12/31/2000 6,220,981 6,141,811 01/31/2001 6,485,181 6,455,457 02/28/2001 6,457,362 6,352,990 03/31/2001 6,511,798 6,266,029 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 7/31/1997, the Fund's Institutional Class inception date, compared to the J.P. Morgan Emerging Markets Bond Index Plus, an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 9/30/1998. The Fund may invest in foreign securities which involve potentially higher risks including currency fluctuations and political or economic uncertainty. Investing in emerging market securities imposes even greater risks including smaller capitalization of securities markets, which can experience illiquidity, price volatility, foreign restrictions, and repatriation of investment income and capital. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The emerging markets sector was among the best performing bond market sectors during the fiscal period as economic and financial conditions improved in most countries. . Volatility increased during the period reflecting a difficult external environment and concerns over slowing growth worldwide. . Divergence in performance occurred between those countries with strong fundamentals vs. those contending with weak domestic growth and heavy reliance on external funding. . The Fund outperformed the J.P. Morgan Emerging Markets Bond Index Plus for the 12-month period ended March 31, 2001, returning 12.94% versus 9.65% for the benchmark. . An underweight to Argentina added to relative performance as debt dynamics continued to deteriorate and economic growth remained weak. . Mexico turned in strong performance on favorable economic data and prospects for an impending rating upgrade; thus the Fund's overweight was positive. . In Brazil, our overweight was modestly negative as strong economic conditions were offset as concerns for the Argentine situation mounted. . An overweight to Bulgaria was negative as market selling and the impact of higher energy prices overshadowed continued economic gains. . An overweight to Poland added to returns as the country showed strong returns on solid economic growth and continued fiscal discipline. . Modest allocations to securities and countries not in the benchmark were positive for relative performance. 22 PIMCO Funds Annual Report | 3.31.01 PIMCO Strategic Balanced Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with preservation of capital and prudent investment management Portfolio: Normally invests between 45% and 75% in the StocksPLUS Fund and between 25% and 55% in the Total Return Fund Total Net Assets: $74.5 million Sector Breakdown:* [GRAPH] StocksPLUS Fund 55.0% Total Return Fund 39.2% Short-Term Instruments 5.8% Other 0.0% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
60% S&P 500 Index and Lipper Inst'l Class Admin. Class 40% Lehman Brothers S&P 500 Balanced (Incep. 6/28/1996) (Incep. 6/30/1999) Aggregate Bond Index Index Fund Average -------------------------------------------------------------------------------------------------------------- 1 Year -8.31% -8.34% -9.09% -21.68% -6.26% 3 Years* 4.27% -- 5.01% 3.05% 3.26% Since Inception* 11.69% -1.91% -- -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] STRATEGIC BALANCED FUND 60% S&P 500 Index and 40% Strategic Lehman Brothers Balanced Aggregate S&P 500 MONTH Fund Bond Index Index -------------------------------------------------------------------------------- 06/30/1996 5,000,000 5,000,000 5,000,000 07/31/1996 4,865,000 4,872,933 4,779,100 08/31/1996 4,940,000 4,931,328 4,879,891 09/30/1996 5,175,000 5,132,224 5,154,532 10/31/1996 5,320,000 5,262,627 5,296,693 11/30/1996 5,615,000 5,537,365 5,697,071 12/31/1996 5,511,545 5,450,953 5,584,212 01/31/1997 5,743,214 5,661,975 5,933,113 02/28/1997 5,775,539 5,694,243 5,979,629 03/31/1997 5,591,600 5,528,617 5,733,926 04/30/1997 5,846,009 5,759,756 6,076,241 05/31/1997 6,089,593 5,991,928 6,446,163 06/30/1997 6,275,398 6,181,439 6,734,951 07/31/1997 6,659,382 6,543,230 7,270,851 08/31/1997 6,423,506 6,300,974 6,863,537 09/30/1997 6,659,150 6,545,208 7,239,453 10/31/1997 6,565,126 6,452,023 6,997,656 11/30/1997 6,736,582 6,643,106 7,321,577 12/31/1997 6,843,897 6,738,297 7,447,289 01/31/1998 6,937,730 6,817,616 7,529,656 02/28/1998 7,213,362 7,110,452 8,072,694 03/31/1998 7,459,339 7,338,829 8,486,097 04/30/1998 7,524,460 7,398,449 8,571,467 05/31/1998 7,447,498 7,350,213 8,424,124 06/30/1998 7,662,852 7,554,287 8,766,312 07/31/1998 7,621,044 7,512,443 8,672,951 08/31/1998 6,904,331 6,909,658 7,419,015 09/30/1998 7,310,278 7,239,956 7,894,278 10/31/1998 7,639,840 7,577,983 8,536,398 11/30/1998 7,885,513 7,870,767 9,053,789 12/31/1998 8,189,101 8,152,341 9,575,468 01/31/1999 8,385,168 8,380,174 9,975,915 02/28/1999 8,117,209 8,165,384 9,665,863 03/31/1999 8,381,044 8,379,502 10,052,594 04/30/1999 8,584,658 8,584,843 10,441,931 05/31/1999 8,407,317 8,433,153 10,195,398 06/30/1999 8,726,038 8,703,230 10,761,242 07/31/1999 8,533,893 8,525,380 10,425,276 08/31/1999 8,507,390 8,498,358 10,373,348 09/30/1999 8,424,034 8,398,023 10,089,329 10/31/1999 8,758,321 8,729,273 10,727,781 11/30/1999 8,845,236 8,835,503 10,945,877 12/31/1999 9,136,140 9,130,707 11,590,589 01/31/2000 8,743,572 8,843,606 11,008,477 02/29/2000 8,679,333 8,785,846 10,799,892 03/31/2000 9,223,089 9,347,855 11,856,445 04/30/2000 9,014,128 9,168,382 11,499,685 05/31/2000 8,956,484 9,053,818 11,263,711 06/30/2000 9,091,403 9,263,069 11,541,362 07/31/2000 9,061,838 9,209,778 11,360,855 08/31/2000 9,475,755 9,606,384 12,066,477 09/30/2000 9,143,966 9,326,269 11,429,488 10/31/2000 9,143,966 9,327,285 11,381,141 11/30/2000 8,868,006 8,947,092 10,483,895 12/31/2000 8,978,129 9,039,710 10,535,118 01/31/2001 9,226,409 9,291,280 10,908,904 02/28/2001 8,777,903 8,815,348 9,914,230 03/31/2001 8,457,009 8,497,979 9,286,164 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 7/01/1996, the first full month following the Fund's Institutional Class inception on 6/28/1996, compared to a static 60/40 blend of the Standard and Poor's 500 Index and the Lehman Brothers Aggregate Bond Index, and the S&P 500 Index, each an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 6/30/1999. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . For the 12-month period ended March 31, 2001, the Fund's Institutional Class shares returned -8.31% versus -9.09% for the Fund's benchmark, a blend of 60% S&P 500 Index and 40% Lehman Brothers Aggregate Index (LBAG). . A slight underweighting to equities was a positive as the S&P 500 returned -21.68% compared to 12.53% for the LBAG. . The Federal Reserve raised interest rates in the April-June period of 2000, and held them steady through year end. With a rapidly slowing economy, the Fed eased on three occasions for a total of 1.50% in the January-March quarter. . The equity allocation, employing PIMCO's StocksPLUS Fund, outperformed the S&P 500 mainly due to the fall in rates in late 2000 and 2001, and attractive yields on corporates and mortgages. . The fixed income allocation, utilizing the PIMCO Total Return Fund outperformed the LBAG due to a longer-than-benchmark duration, an underweight in corporates and an overweight in mortgages. 3.31.01 | PIMCO Funds Annual Report 23 PIMCO Convertible Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Seeks maximum total return, consistent with prudent investment management Portfolio: Primarily convertible securities Duration: 1.3 years Total Net Assets: $91.7 million Sector Breakdown:* [GRAPH] Convertible Bonds & Notes 60.5% Convertible Preferred Stock 36.7% Other 2.8% Quality Breakdown:* [GRAPH] AA 8.6% A 30.9% BBB 38.8% BB 12.2% B 9.5% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PORTFOLIO CHARACTERISTICS -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
First Boston Lipper Inst'l Class Admin. Class Convertible Convertible Securities (Incep. 3/31/1999) (Incep. 8/01/2000) Bond Index Fund Average --------------------------------------------------------------------------------------------------------- 1 Year -23.00% -- -18.84% -15.31% Since Inception 11.21%* -16.25% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] CONVERTIBLE FUND Convertible First Boston MONTH Fund Convertible Bond Index -------------------------------------------------------------------------------- 03/31/1999 5,000,000 5,000,000 04/30/1999 5,240,000 5,202,500 05/31/1999 5,335,000 5,154,637 06/30/1999 5,625,000 5,376,802 07/31/1999 5,640,000 5,305,828 08/31/1999 5,630,000 5,321,746 09/30/1999 5,685,000 5,335,582 10/31/1999 5,915,000 5,520,194 11/30/1999 6,350,000 5,944,144 12/31/1999 7,109,943 6,847,654 01/31/2000 7,257,010 6,744,254 02/29/2000 8,032,917 7,452,401 03/31/2000 8,032,816 7,292,174 04/30/2000 7,497,974 6,936,316 05/31/2000 7,258,568 6,564,529 06/30/2000 7,620,361 6,991,223 07/31/2000 7,400,886 6,780,089 08/31/2000 7,967,437 7,301,477 09/30/2000 7,872,203 7,197,796 10/31/2000 7,507,607 6,867,108 11/30/2000 6,567,872 6,035,501 12/31/2000 7,055,087 6,311,504 01/31/2001 7,240,032 6,681,615 02/28/2001 6,451,298 6,169,406 03/31/2001 6,185,149 5,918,311 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 3/31/1999, the Fund's Institutional Class inception date, compared to the First Boston Convertible Bond Index, an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 8/01/2000. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The Convertible Fund Institutional Class shares returned -23.00% for the 12-month period ended March 31, 2001 underperforming the First Boston Convertible Securities Index return of -18.84%. . The Technology and Telecommunications sectors accounted for substantially all of the Fund's underperformance as these sectors imploded in the face of recession fears and reduced investment spending. . An overweight to investment grade convertibles was positive as investors sought the downside protection offered by higher quality issues. . The utility and energy sectors boosted performance as these sectors benefited from supply driven bottlenecks and higher natural gas prices. . The Fund's lower than Index delta, or sensitivity to price movements in the underlying stock prices, helped returns amid sharp declines in the global equity markets. . The use of a proprietary valuation model added to returns as security mispricing and relative value among different issues enhanced security selection. 24 PIMCO Funds Annual Report | 3.31.01 PIMCO European Convertible Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with prudent investment management Portfolio: Primarily European convertible securities Duration: 1.5 years Total Net Assets: $5.0 million -------------------------------------------------------------------------------- PORTFOLIO COMPOSITION -------------------------------------------------------------------------------- Sector Breakdown:* [GRAPH] Convertible Bonds & Notes 69.8% Short-Term Instruments 24.8% Other 5.4% Quality Breakdown:* [GRAPH] AAA 28.6% AA 22.1% A 30.1% BBB 19.2% *% of Total Investments as of March 31, 2001 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that Fund shares, when redeemed, may be worth more or less than their original cost. The Fund commenced operations on 11/30/2000. The total return performance since inception was 0.10%. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The European Convertible Fund's investment objective is to seek maximum total return, consistent with prudent investment management. . The Fund commenced operations on November 30, 2000. . The Fund's benchmark is the Warburg Dillon Reed Euro Convertible Index. . Under normal circumstances, the Fund seeks to achieve its investment objective by investing at least 65% of its assets in a diversified portfolio of European convertible securities. . European convertible securities include any convertible security issued by, or convertible into, an issuer located in any European country. . The Fund may invest its assets in securities denominated in any currency and may invest up to 35% of its assets in non-European issuers. . The Fund had an average AA- credit quality at March 31, 2001. 3.31.01 | PIMCO Funds Annual Report 25 PIMCO StocksPLUS Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Total return which exceeds that of the S&P 500 Index Portfolio: Primarily S&P 500 stock index derivatives backed by a portfolio of short-term fixed income securities Duration: 1.1 years Total Net Assets: $1.0 billion Sector Breakdown:* [GRAPH] Mortgage-Backed Securities 49.7% Corporate Bonds & Notes 19.1% U.S. Treasury Obligations 8.7% Sovereign Issues 7.6% Short-Term Instruments 6.7% Asset-Backed Securities 6.3% Other 1.9% Quality Breakdown:* [GRAPH] AAA 74.0% AA 6.4% A 3.4% BBB 11.2% BB 5.0% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Inst'l Class Admin. Class Lipper Large-Cap (Incep. 5/14/1993) (Incep. 1/07/1997) S&P 500 Index Core Fund Average ------------------------------------------------------------------------------------------------ 1 Year -20.93% -21.21% -21.68% -22.12% 3 Years* 3.10% 2.71% 3.05% 1.88% 5 Years* 14.11% -- 14.18% 11.64% Since Inception* 15.92% 11.75% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] STOCKSPLUS FUND StocksPLUS S&P 500 MONTH Fund Index -------------------------------------------------------------------------------- 05/31/1993 5,000,000 5,000,000 06/30/1993 5,027,261 5,014,650 07/31/1993 5,017,471 4,994,491 08/31/1993 5,208,380 5,183,982 09/30/1993 5,157,774 5,144,221 10/31/1993 5,271,731 5,250,655 11/30/1993 5,212,275 5,200,616 12/31/1993 5,306,421 5,263,492 01/31/1994 5,480,662 5,442,451 02/28/1994 5,311,701 5,294,743 03/31/1994 5,077,284 5,063,892 04/30/1994 5,141,283 5,128,811 05/31/1994 5,237,282 5,212,974 06/30/1994 5,126,078 5,085,204 07/31/1994 5,325,725 5,252,202 08/31/1994 5,568,540 5,467,543 09/30/1994 5,473,357 5,333,861 10/31/1994 5,561,106 5,453,713 11/30/1994 5,391,092 5,255,089 12/31/1994 5,461,225 5,333,022 01/31/1995 5,612,304 5,471,307 02/28/1995 5,864,102 5,684,524 03/31/1995 6,023,776 5,852,274 04/30/1995 6,219,204 6,024,624 05/31/1995 6,500,850 6,265,428 06/30/1995 6,643,179 6,410,974 07/31/1995 6,854,074 6,623,561 08/31/1995 6,900,939 6,640,187 09/30/1995 7,193,848 6,920,403 10/31/1995 7,181,918 6,895,697 11/30/1995 7,527,891 7,198,418 12/31/1995 7,673,723 7,337,059 01/31/1996 7,949,045 7,586,813 02/29/1996 7,970,224 7,657,142 03/31/1996 8,076,117 7,730,881 04/30/1996 8,177,430 7,844,834 05/31/1996 8,365,584 8,047,152 06/30/1996 8,445,187 8,077,812 07/31/1996 8,052,904 7,720,934 08/31/1996 8,223,140 7,883,768 09/30/1996 8,704,242 8,327,467 10/31/1996 8,981,877 8,557,139 11/30/1996 9,649,702 9,203,973 12/31/1996 9,444,046 9,021,642 01/31/1997 10,025,985 9,585,314 02/28/1997 10,100,806 9,660,463 03/31/1997 9,646,437 9,263,515 04/30/1997 10,244,078 9,816,546 05/31/1997 10,892,224 10,414,178 06/30/1997 11,344,245 10,880,733 07/31/1997 12,278,977 11,746,513 08/31/1997 11,616,167 11,088,473 09/30/1997 12,220,454 11,695,789 10/31/1997 11,832,913 11,305,149 11/30/1997 12,315,186 11,828,465 12/31/1997 12,546,229 12,031,560 01/31/1998 12,716,721 12,164,629 02/28/1998 13,569,183 13,041,941 03/31/1998 14,253,076 13,709,819 04/30/1998 14,425,043 13,847,740 05/31/1998 14,141,803 13,609,698 06/30/1998 14,691,669 14,162,524 07/31/1998 14,528,428 14,011,693 08/31/1998 12,314,475 11,985,882 09/30/1998 13,256,889 12,753,698 10/31/1998 14,302,676 13,791,084 11/30/1998 15,122,901 14,626,961 12/31/1998 16,099,828 15,469,767 01/31/1999 16,648,553 16,116,712 02/28/1999 16,088,153 15,615,805 03/31/1999 16,768,984 16,240,593 04/30/1999 17,436,465 16,869,592 05/31/1999 16,979,768 16,471,301 06/30/1999 17,970,000 17,385,458 07/31/1999 17,379,659 16,842,684 08/31/1999 17,285,204 16,758,790 09/30/1999 16,909,003 16,299,940 10/31/1999 17,981,456 17,331,400 11/30/1999 18,279,360 17,683,747 12/31/1999 19,341,400 18,725,320 01/31/2000 18,343,134 17,784,881 02/29/2000 18,065,838 17,447,899 03/31/2000 19,758,181 19,154,826 04/30/2000 19,143,792 18,578,458 05/31/2000 18,752,817 18,197,228 06/30/2000 19,218,094 18,645,789 07/31/2000 18,978,573 18,354,169 08/31/2000 20,246,629 19,494,147 09/30/2000 19,133,350 18,465,051 10/31/2000 19,047,934 18,386,944 11/30/2000 17,610,085 16,937,386 12/31/2000 17,751,217 17,020,141 01/31/2001 18,440,436 17,624,015 02/28/2001 16,740,362 16,017,058 03/31/2001 15,622,296 15,002,377 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the invest- ment of $5,000,000 on 6/01/1993, the first full month following the Fund's Institutional Class inception on 5/14/1993, compared to the Standard and Poor's 500 Index, an unmanaged market index. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 1/07/1997. The Fund may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . After posting double-digit twelve-month returns for the past six years in an unprecedented equity bull market, the S&P 500 Index fell substantially over the past twelve months, returning a negative 21.68%. . Despite volatile equity and fixed income markets, the StocksPLUS Fund outperformed the S&P 500 Index after fees. . Short-term interest rates declined substantially as a result of anticipated and realized Federal Reserve easing. As such, the extended duration of the StocksPLUS Fund enhanced relative performance. . Although spreads widened in conjunction with increased prepayment risk, mortgage holdings boosted returns due to the high quality and attractive yields provided by these issues. . Corporate performance was mixed with higher quality issues adding to performance and lower quality issues detracting as heightened credit concerns associated with the slowing economy led to adverse price performance. 26 PIMCO Funds Annual Report | 3.31.01 PIMCO Municipal Bond Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: High current income exempt from federal income tax, consistent with preservation of capital. Capital appreciation is a secondary objective. Portfolio: Primarily intermediate and long-term maturity municipal securities (exempt from federal income tax) Duration: 7.2 years Total Net Assets: $80.1 million Sector Breakdown:* [GRAPH] Municipal Bonds & Notes 99.3% Other 0.7% Quality Breakdown:* [GRAPH] AAA 53.1% AA 13.6% A 6.8% BBB 18.7% BB 7.8% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PORTFOLIO CHARACTERISTICS -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Lehman Brothers Lipper General Inst'l Class Admin. Class General Municipal Municipal (Incep. 12/31/1997) (Incep. 9/30/1998) Bond Index Debt Fund Average --------------------------------------------------------------------------------------------------------- 1 Year 11.13% 10.86% 10.93% 9.91% 3 Years* 4.98% -- 5.59% 4.04% Since Inception* 4.85% 3.68% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] MUNICIPAL BOND FUND Lehman Brothers Municipal General Municipal MONTH Bond Fund Bond Index -------------------------------------------------------------------------------- 12/31/1997 5,000,000 5,000,000 01/31/1998 5,058,771 5,051,500 02/28/1998 5,035,172 5,053,016 03/31/1998 5,039,379 5,057,562 04/30/1998 5,006,296 5,034,805 05/31/1998 5,105,540 5,114,354 06/30/1998 5,122,719 5,134,299 07/31/1998 5,128,447 5,147,137 08/31/1998 5,223,548 5,226,915 09/30/1998 5,293,484 5,292,252 10/31/1998 5,282,938 5,292,252 11/30/1998 5,296,412 5,310,775 12/31/1998 5,302,933 5,324,053 01/31/1999 5,373,214 5,387,409 02/28/1999 5,338,814 5,363,705 03/31/1999 5,343,842 5,371,213 04/30/1999 5,354,304 5,384,642 05/31/1999 5,314,853 5,353,412 06/30/1999 5,217,784 5,276,322 07/31/1999 5,228,509 5,295,317 08/31/1999 5,173,421 5,252,953 09/30/1999 5,166,761 5,255,056 10/31/1999 5,100,796 5,198,299 11/30/1999 5,153,694 5,253,401 12/31/1999 5,105,896 5,214,003 01/31/2000 5,076,823 5,191,581 02/29/2000 5,130,397 5,251,804 03/31/2000 5,247,153 5,366,818 04/30/2000 5,221,693 5,335,153 05/31/2000 5,198,809 5,307,409 06/30/2000 5,317,548 5,448,053 07/31/2000 5,383,204 5,523,778 08/31/2000 5,469,026 5,608,845 09/30/2000 5,465,577 5,579,681 10/31/2000 5,517,329 5,640,499 11/30/2000 5,504,367 5,683,366 12/31/2000 5,631,212 5,823,744 01/31/2001 5,682,823 5,881,401 02/28/2001 5,767,136 5,900,221 03/31/2001 5,831,025 5,953,323 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 12/31/1997, the Fund's Institutional Class inception date, compared to the Lehman Brothers General Municipal Bond Index, an unmanaged market index. Income may be subject to state and local taxes and (if applicable) the Alternative Minimum Tax. The performance of the Administrative Class (shown above) reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 9/30/1998. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . From March 31, 2000 to March 31, 2001 the Fund gained 11.13%, exceeding by 0.2% the return of its benchmark, the Lehman Brothers General Municipal Bond Index. . The Fund maintained a below-benchmark duration for most of this year, detracting from performance due to the overall decline in municipal yields. . The municipal yield curve steepened over the fiscal year as shorter term yields fell by nearly 1.00% while longer-term yields fell by 0.40% to 0.50%. . Underweighting shorter-maturity bonds during the latter half of the fiscal year detracted from returns as short-term yields dropped the most in response to Fed easing. . The Fund maintained a high AA average credit quality during the fiscal year, which modestly benefited returns amid a heightened investor focus on credit quality. . Favorable security selection, involving longer-term discount revenue bonds, contributed to relative performance. . The SEC yield after fees was 4.34%, or a fully tax adjusted 7.19% under a federal tax rate of 39.6%. 3.31.01 | PIMCO Funds Annual Report 27 PIMCO Short Duration Municipal Income Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Seeks high current income exempt from federal income tax, consistent with preservation of capital Portfolio: Primarily short and intermediate maturity municipal securities (exempt from federal income tax) Duration: 1.9 years Total Net Assets: $13.7 million Sector Breakdown:* [GRAPH] Municipal Bonds & Notes 99.8% Other 0.2% Quality Breakdown:* [GRAPH] AAA 48.3% AA 23.5% A 5.0% BBB 23.2% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PORTFOLIO CHARACTERISTICS -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Inst'l Class Lehman Brothers 1-Year Lipper Short Municipal (Incep. 8/31/1999) Municipal Bond Index Debt Fund Average ---------------------------------------------------------------------------------------- 1 Year 6.22% 6.32% 6.00% Since Inception* 5.32% -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] SHORT DURATION MUNICIPAL INCOME FUND Short Duration Lehman Brothers Municipal Income 1-Year Municipal MONTH Fund Bond Index -------------------------------------------------------------------------------- 08/31/1999 5,000,000 5,000,000 09/30/1999 5,015,118 5,012,000 10/31/1999 5,026,688 5,023,025 11/30/1999 5,043,155 5,038,597 12/31/1999 5,056,562 5,042,629 01/31/2000 5,077,025 5,061,792 02/29/2000 5,086,181 5,076,977 03/31/2000 5,109,575 5,098,804 04/30/2000 5,117,236 5,111,043 05/31/2000 5,126,760 5,119,223 06/30/2000 5,161,314 5,161,199 07/31/2000 5,188,759 5,190,100 08/31/2000 5,219,335 5,216,569 09/30/2000 5,245,011 5,228,047 10/31/2000 5,280,167 5,252,619 11/30/2000 5,294,485 5,272,582 12/31/2000 5,350,202 5,312,122 01/31/2001 5,379,572 5,375,336 02/28/2001 5,406,064 5,393,077 03/31/2001 5,427,510 5,421,120 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 8/31/1999, the Fund's Institutional Class inception date compared to the Lehman Brothers 1-Year Municipal Bond Index, an unmanaged market index. Income may be subject to state and local taxes and (if applicable) the Alternative Minimum Tax. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . Over the fiscal year ended March 31, 2001, the Fund gained 6.22% versus 6.32% for the benchmark Lehman Brother's 1-Year Municipal Bond Index. . Short-term municipal yields fell over the fiscal year by more than 1.00% in reaction to Fed easing and a slowing U.S. economy. . The Fund's duration was managed to be above that of the benchmark, improving returns as municipal interest rates dropped substantially. . A broader-than-Index maturity structure, including holding above-Index maturities, reduced relative returns as shorter maturity yields fell more. . Security selection, including allocations to insured bonds and inflation-indexed municipal bonds, boosted relative returns. . The Fund maintained a high weighted average credit quality throughout the fiscal year, improving returns, as higher-rated credits generally outperformed. . The Fund's SEC yield after fees as of March 31, 2001 was 3.61%, or a fully tax-adjusted 5.98% under a federal income tax rate of 39.60%. 28 PIMCO Funds Annual Report | 3.31.01 PIMCO California Intermediate Municipal Bond Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Seeks high current income exempt from federal and California income tax. Capital appreciation is a secondary objective Portfolio: Primarily intermediate maturity municipal securities (exempt from federal and California income tax) Duration: 6.7 years Total Net Assets: $118.5 million Sector Breakdown:* [GRAPH] Municipal Bonds & Notes 99.6% Other 0.4% Quality Breakdown:* [GRAPH] AAA 52.4% AA 23.8% A 8.1% BBB 10.6% BB 5.1% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PORTFOLIO CHARACTERISTICS -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001 Lehman Brothers Lipper California Inst'l Admin. Intermediate Intermediate Class Class California Municipal (Incep. (Incep. Insured Municipal Debt Fund Average 8/31/1999) 9/07/1999) Bond Index -------------------------------------------------------------------------------- 1 Year 10.60% 10.36% 9.29% 8.98% Since Inception* 8.68% 8.36% -- -- * Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] CALIFORNIA INTERMEDIATE MUNICIPAL BOND FUND MONTH California Intermed. Lehman Brothers Municipal Bond Fund Intermed. California Insured Municipal Bond Index = = = 08/31/1999 5,000,000 5,000,000 09/30/1999 5,035,313 5,031,999 10/31/1999 4,998,038 4,998,789 11/30/1999 5,040,593 5,039,779 12/31/1999 5,018,422 4,993,413 01/31/2000 5,034,390 5,021,873 02/29/2000 5,066,955 5,049,494 03/31/2000 5,158,118 5,123,722 04/30/2000 5,145,459 5,084,783 05/31/2000 5,170,144 5,098,512 06/30/2000 5,268,173 5,213,226 07/31/2000 5,337,733 5,284,647 08/31/2000 5,414,917 5,367,088 09/30/2000 5,398,442 5,336,498 10/31/2000 5,433,154 5,367,982 11/30/2000 5,459,904 5,392,140 12/31/2000 5,550,991 5,478,411 01/31/2001 5,641,724 5,575,925 02/28/2001 5,650,896 5,574,812 03/31/2001 5,704,668 5,599,899 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 8/31/1999, the Fund's Institutional Class inception date compared to the Lehman Brothers Intermediate California Insured Municipal Bond Index, an unmanaged market index. Income may be subject to state and local taxes and (if applicable) the Alternative Minimum Tax. The performance of the Administrative Class reflects the payment of a service fee in an amount not to exceed 0.25% on an annualized basis. The Administrative Class commenced operations on 9/07/1999. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . For the year ended March 31, 2001, the Fund returned 10.60%, outperforming the 9.29% of the benchmark Lehman Brothers Intermediate California Insured Municipal Bond Index. . Over the fiscal year, the California municipal yield curve steepened modestly as shorter-maturity yields fell by as much as 0.80% while longer-maturity yields dropped by 0.50% to 0.60%. . The Fund's management maintained an above benchmark duration, improving the Fund's performance as California municipal yields declined for all maturities. . Overweighting long-maturity bonds detracted marginally from returns as long-maturity yields dropped less than intermediate-maturity yields. . The Fund's management maintained an average AA credit quality during the past fiscal year, which benefited returns as investors required higher credit premiums on lower quality bonds. . Allocations to non-California bonds, also qualifying for California income tax exemption, improved returns as California debt underperformed non-California debt in the latter half of the fiscal year in reaction to the California energy crisis. . Individual security selection, especially longer-term insured bonds, contributed to above-benchmark returns. . The SEC yield after fees was 4.42%, or a fully tax adjusted 8.07% under a federal tax rate of 39.60% and a California tax rate of 9.30%. 3.31.01 | PIMCO Funds Annual Report 29 PIMCO California Municipal Bond Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Seeks high current income exempt from federal and California income tax. Capital appreciation is a secondary objective Portfolio: Primarily intermediate to long-term maturity municipal securities (exempt from federal and California income tax) Duration: 7.0 years Total Net Assets: $12.7 million Sector Breakdown:* [GRAPH] Municipal Bonds & Notes 98.2% Other 1.8% Quality Breakdown:* [GRAPH] AAA 60.6% AA 21.8% A 4.2% BBB 8.0% BB 5.4% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001 Lehman Lipper California California Inst'l Class Insured Municipal (Incep. Municipal Debt Fund 5/16/2000) Index Average -------------------------------------------------------------------------------- 6 Months 6.35% 5.88% 5.61% Since Inception 12.49% -- -- CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] California Municipal Bond Fund California Municipal Lehman California Insured MONTH Bond Fund Municipal Index -------------------------------------------------------------------------------- 05/31/2000 5,000,000 5,000,000 06/30/2000 5,104,932 5,160,502 07/31/2000 5,176,634 5,237,387 08/31/2000 5,249,866 5,357,327 09/30/2000 5,237,446 5,328,931 10/31/2000 5,268,264 5,372,632 11/30/2000 5,299,674 5,415,073 12/31/2000 5,409,493 5,535,288 01/31/2001 5,493,367 5,587,321 02/28/2001 5,532,919 5,596,818 03/31/2001 5,569,930 5,642,153 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that Fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 6/01/2000, the first full month following the Fund's Institutional Class inception on 5/16/2000, compared to the Lehman California Insured Municipal Index, an unmanaged market index. Income may be subject to state and local taxes and (if applicable) the Alternative Minimum Tax. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The California Municipal Bond Fund returned 12.49% over the period from inception through the fiscal year-end at March 31, 2001. . The Fund outperformed its benchmark, the Lehman Insured California Municipal Index, 6.35% versus 5.88% for the six-month period ended March 31, 2001. . For the measurement period of June 2000 to March 2001, California yields fell for all maturities with shorter-term yields dropping by up to 1.40% in reaction to Federal Reserve easing. . An overweighting of intermediate maturities was positive for relative performance as intermediate California yields decreased more than long maturity yields. . Non-California positions, especially Puerto Rico paper qualifying for California tax exemption, improved returns as the California market generally underperformed non-California debt during the latter half of the Fund's fiscal year. . The Fund maintained a high AA+ average credit quality, which assisted returns as higher-rated California debt had greater returns than lower-rated debt during the fiscal year. . As of March 31, 2001 the Fund's duration was 7.0 years versus 8.7 years for benchmark. 30 PIMCO Funds Annual Report | 3.31.01 PIMCO New York Municipal Bond Fund -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Seeks high current income exempt from federal and New York income tax. Capital appreciation is a secondary objective Portfolio: Primarily intermediate to long-term maturity municipal securities (exempt from federal and New York income tax) Duration: 5.4 years Total Net Assets: $4.1 million Sector Breakdown:* [GRAPH] Municipal Bonds & Notes 91.8% Short-Term Instruments 8.2% Quality Breakdown:* [GRAPH] AAA 35.1% AA 20.3% A 15.5% BBB 29.1% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PORTFOLIO CHARACTERISTICS -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001 Lehman Brothers Lehman Brothers Lipper New York Inst'l New York Intermediate Intermediate Class Insured New York Municipal (Incep. Municipal Bond Insured Municipal Debt Fund 8/31/1999) Index Bond Index Average -------------------------------------------------------------------------------- 1 Year 12.77% 12.13% 10.73% 9.91% Since Inception* 9.20% -- -- -- * Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] NEW YORK MUNICIPAL BOND FUND Lehman Bros. Lehman Bros. NY Insured Intermediate NY NY Municipal Bond Insured Municipal Bond MONTH Muni. Bond Fund Index Index -------------------------------------------------------------------------------- 08/31/1999 5,000,000 5,000,000 5,000,000 09/30/1999 5,019,710 4,993,502 5,015,500 10/31/1999 4,980,249 4,924,089 4,991,426 11/30/1999 5,025,490 4,993,028 5,030,857 12/31/1999 5,006,999 4,941,600 5,009,727 01/31/2000 4,983,454 4,912,940 4,991,693 02/29/2000 5,015,826 4,986,631 5,018,647 03/31/2000 5,096,773 5,113,293 5,091,418 04/30/2000 5,067,630 5,064,206 5,073,089 05/31/2000 5,050,517 5,039,895 5,057,871 06/30/2000 5,174,063 5,203,693 5,181,281 07/31/2000 5,232,730 5,272,379 5,249,674 08/31/2000 5,340,170 5,365,700 5,325,796 09/30/2000 5,349,497 5,332,434 5,306,090 10/31/2000 5,415,568 5,400,156 5,353,314 11/30/2000 5,449,805 5,447,140 5,381,687 12/31/2000 5,558,734 5,617,632 5,496,316 01/31/2001 5,634,983 5,665,942 5,588,105 02/28/2001 5,675,787 5,671,042 5,580,841 03/31/2001 5,747,731 5,733,422 5,637,763 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that fund shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 8/31/1999, the Fund's Institutional Class inception date compared to the Lehman Brothers New York Insured Municipal Bond Index and the Lehman Brothers Intermediate New York Insured Municipal Bond Index, each an unmanaged market index. Income may be subject to state and local taxes and (if applicable) the Alternative Minimum Tax. We will no longer compare the Fund to the Lehman Brothers Intermediate New York Insured Municipal Bond Index since the Lehman Brothers Intermediate New York Insured Municipal Bond Index is not a comparable New York municipal index. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . For the year ending March 31, 2001, the Fund returned 12.77%, outperforming the 12.13% return of the Lehman Brothers New York Insured Municipal Bond Index. . A shorter-than-benchmark duration detracted from returns as New York municipal yields fell throughout the fiscal year. . Overweighting shorter-maturity bonds improved relative performance as yield decreases were greater for shorter-maturity New York municipal bonds. . The Fund maintained a high credit quality of AA- or greater throughout the fiscal year, which boosted returns modestly as higher-rated bonds outperformed. . Intermediate insured municipals, especially state general obligation issues, with call protection added to returns due to ratings upgrades. . As of March 31, 2001, the SEC yield after fees was 4.18%, or a tax-adjusted 7.43%, assuming a federal tax rate of 39.60% and a New York state tax rate of 6.85%. 3.31.01 | PIMCO Funds Annual Report 31 Financial Highlights - Institutional Classes
Net Realized/ Net Unrealized Total Dividends Dividends in Net Asset Investment Gain Income from from Net Excess of Net Beginning Income (Loss) on Investment Investment Investment Selected Per Share Data for the Year or of Period (Loss) Investments Operations Income Income Period Ended: Total Return Fund Institutional Class 03/31/2001 $ 9.96 $ 0.67 (a) $ 0.56 (a) $ 1.23 $ (0.65) $ (0.02) 03/31/2000 10.36 0.63 (a) (0.40)(a) 0.23 (0.60) (0.03) 03/31/1999 10.62 0.63 (a) 0.16 (a) 0.79 (0.63) 0.00 03/31/1998 10.27 0.64 (a) 0.62 (a) 1.26 (0.62) (0.02) 03/31/1997 10.29 0.68 (0.02) 0.66 (0.66) (0.02) Administrative Class 03/31/2001 9.96 0.64 (a) 0.56 (a) 1.20 (0.62) (0.02) 03/31/2000 10.36 0.61 (a) (0.41)(a) 0.20 (0.58) (0.02) 03/31/1999 10.62 0.61 (a) 0.16 (a) 0.77 (0.61) 0.00 03/31/1998 10.27 0.61 (a) 0.63 (a) 1.24 (0.60) (0.02) 03/31/1997 10.29 0.66 (a) (0.02)(a) 0.64 (0.64) (0.02) Total Return Fund II Institutional Class 03/31/2001 $ 9.67 $ 0.62 (a) $ 0.60 (a) $ 1.22 $ (0.61) $ (0.01) 03/31/2000 10.11 0.58 (a) (0.44)(a) 0.14 (0.58) 0.00 03/31/1999 10.26 0.59 (a) 0.17 (a) 0.76 (0.59) 0.00 03/31/1998 9.85 0.63 (a) 0.52 (a) 1.15 (0.60) (0.03) 03/31/1997 9.89 0.61 (0.02) 0.59 (0.62) (0.01) Administrative Class 03/31/2001 9.67 0.59 (a) 0.60 (a) 1.19 (0.58) (0.01) 03/31/2000 10.11 0.55 (a) (0.44)(a) 0.11 (0.55) 0.00 03/31/1999 10.26 0.56 (a) 0.17 (a) 0.73 (0.56) 0.00 03/31/1998 9.85 0.60 (a) 0.52 (a) 1.12 (0.57) (0.03) 03/31/1997 9.89 0.59 (0.02) 0.57 (0.60) (0.01) Total Return Fund III Institutional Class 03/31/2001 $ 8.74 $ 0.57 (a) $ 0.45 (a) $ 1.02 $ (0.56) $ (0.01) 03/31/2000 9.27 0.55 (a) (0.53)(a) 0.02 (0.54) (0.01) 03/31/1999 9.55 0.57 (a) 0.20 (a) 0.77 (0.56) 0.00 03/31/1998 9.15 0.57 (a) 0.56 (a) 1.13 (0.54) (0.03) 03/31/1997 9.13 0.55 0.05 0.60 (0.55) (0.02) Administrative Class 03/31/2001 8.74 0.55 (a) 0.45 (a) 1.00 (0.54) (0.01) 03/31/2000 9.27 0.54 (a) (0.54)(a) 0.00 (0.52) (0.01) 03/31/1999 9.55 0.55 (a) 0.20 (a) 0.75 (0.54) 0.00 04/11/1997 - 03/31/1998 9.12 0.54 (a) 0.58 (a) 1.12 (0.50) (0.03) Moderate Duration Fund Institutional Class 03/31/2001 $ 9.52 $ 0.64 (a) $ 0.47 (a) $ 1.11 $ (0.63) $ 0.00 03/31/2000 9.94 0.60 (a) (0.42)(a) 0.18 (0.58) (0.02) 03/31/1999 10.14 0.60 (a) 0.07 (a) 0.67 (0.60) 0.00 03/31/1998 9.83 0.38 (a) 0.56 (a) 0.94 (0.60) 0.00 12/31/1996 - 03/31/1997 10.00 0.15 (0.17) (0.02) (0.15) 0.00 Low Duration Fund Institutional Class 03/31/2001 $ 9.81 $ 0.68 (a) $ 0.21 (a) $ 0.89 $ (0.65) $ (0.02) 03/31/2000 10.10 0.64 (a) (0.29)(a) 0.35 (0.63) (0.01) 03/31/1999 10.18 0.65 (a) (0.02)(a) 0.63 (0.65) 0.00 03/31/1998 9.98 0.65 (a) 0.23 (a) 0.88 (0.63) (0.02) 03/31/1997 9.95 0.64 0.03 0.67 (0.63) (0.01) Administrative Class 03/31/2001 9.81 0.62 (a) 0.25 (a) 0.87 (0.63) (0.02) 03/31/2000 10.10 0.61 (a) (0.29)(a) 0.32 (0.60) (0.01) 03/31/1999 10.18 0.62 (a) (0.02)(a) 0.60 (0.62) 0.00 03/31/1998 9.98 0.63 (a) 0.22 (a) 0.85 (0.60) (0.02) 03/31/1997 9.95 0.62 0.03 0.65 (0.60) (0.02)
+ Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) Ratio of expenses to average net assets excluding interest expense 0.43%. (c) Ratio of expenses to average net assets excluding interest expense 0.68%. (d) Ratio of expenses to average net assets exluding interest expense 0.74%. 32 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Distributions Distributions from Net in Excess of Net Tax Basis Net Asset Realized Realized Capital Return of Total Value End Total Net Assets End Capital Gains Gains Capital Distributions of Period Return of Period (000s) $ 0.00 $ 0.00 $ 0.00 $ (0.67) $ 10.52 12.80% $31,746,629 0.00 0.00 0.00 (0.63) 9.96 2.33 24,900,321 (0.24) (0.18) 0.00 (1.05) 10.36 7.60 21,711,396 (0.27) 0.00 0.00 (0.91) 10.62 12.63 16,484,119 0.00 0.00 0.00 (0.68) 10.27 6.60 12,528,536 0.00 0.00 0.00 (0.64) 10.52 12.52 5,353,222 0.00 0.00 0.00 (0.60) 9.96 2.07 3,233,785 (0.24) (0.18) 0.00 (1.03) 10.36 7.33 1,972,984 (0.27) 0.00 0.00 (0.89) 10.62 12.36 481,730 0.00 0.00 0.00 (0.66) 10.27 6.34 151,194 $ 0.00 $ 0.00 $ 0.00 $ (0.62) $ 10.27 13.02% $1,606,998 0.00 0.00 0.00 (0.58) 9.67 1.46 1,263,556 (0.18) (0.14) 0.00 (0.91) 10.11 7.46 986,690 (0.11) 0.00 0.00 (0.74) 10.26 11.99 574,587 0.00 0.00 0.00 (0.63) 9.85 6.15 478,451 0.00 0.00 0.00 (0.59) 10.27 12.74 77,183 0.00 0.00 0.00 (0.55) 9.67 1.20 56,755 (0.18) (0.14) 0.00 (0.88) 10.11 7.19 54,736 (0.11) 0.00 0.00 (0.71) 10.26 11.71 15,172 0.00 0.00 0.00 (0.61) 9.85 5.88 5,304 $ 0.00 $ 0.00 $ 0.00 $ (0.57) $ 9.19 12.15% $ 868,757 0.00 0.00 0.00 (0.55) 8.74 0.33 635,592 (0.24) (0.25) 0.00 (1.05) 9.27 8.20 488,243 (0.16) 0.00 0.00 (0.73) 9.55 12.62 365,249 0.00 (0.01) 0.00 (0.58) 9.15 6.76 193,297 0.00 0.00 0.00 (0.55) 9.19 11.83 11,223 0.00 0.00 0.00 (0.53) 8.74 0.08 10,144 (0.24) (0.25) 0.00 (1.03) 9.27 7.93 1,867 (0.16) 0.00 0.00 (0.69) 9.55 12.46 178 $ 0.00 $ 0.00 $ 0.00 $ (0.63) $ 10.00 12.09% $ 576,911 0.00 0.00 0.00 (0.60) 9.52 1.86 387,126 (0.11) (0.16) 0.00 (0.87) 9.94 6.70 317,400 (0.03) 0.00 0.00 (0.63) 10.14 9.80 239,152 0.00 0.00 0.00 (0.15) 9.83 (0.25) 13,458 $ 0.00 $ 0.00 $ 0.00 $ (0.67) $ 10.03 9.44% $3,950,592 0.00 0.00 0.00 (0.64) 9.81 3.56 3,440,455 (0.01) (0.05) 0.00 (0.71) 10.10 6.35 3,367,438 (0.03) 0.00 0.00 (0.68) 10.18 9.00 2,759,531 0.00 0.00 0.00 (0.64) 9.98 6.97 2,797,001 0.00 0.00 0.00 (0.65) 10.03 9.17 151,774 0.00 0.00 0.00 (0.61) 9.81 3.30 118,874 (0.01) (0.05) 0.00 (0.68) 10.10 6.09 128,212 (0.03) 0.00 0.00 (0.65) 10.18 8.73 46,186 0.00 0.00 0.00 (0.62) 9.98 6.71 23,564 Ratio of Net Ratio of Investment Expenses to Income (Loss) Average Net to Average Net Portfolio Assets Assets Turnover Rate 0.49%(b) 6.57% 450% 0.54(b) 6.25 223 0.43 5.91 154 0.43 6.06 206 0.43 6.60 173 0.74(c) 6.31 450 0.79(c) 6.01 223 0.68 5.52 154 0.68 5.74 206 0.68 6.35 173 0.51% 6.24% 566% 0.50 5.89 142 0.50 5.65 213 0.50 6.15 361 0.50 6.38 293 0.76(d) 6.00 566 0.75 5.56 142 0.75 5.33 213 0.75 5.86 361 0.75 6.13 293 0.50% 6.46% 581% 0.50 6.21 186 0.50 5.85 216 0.51 5.99 183 0.51 6.21 90 0.75 6.12 581 0.75 6.11 186 0.75 5.59 216 0.76+ 5.85+ 183 0.45% 6.54% 377% 0.47 6.16 129 0.45 5.94 169 0.45 3.75 96 0.44+ 6.01+ 49 0.49%(b) 6.86% 348% 0.51(b) 6.40 82 0.43 6.36 245 0.43 6.39 309 0.43 6.46 240 0.74(c) 6.31 348 0.75(c) 6.13 82 0.68 6.09 245 0.68 6.16 309 0.68 6.21 240
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 33 Financial Highlights - Institutional Classes (Cont.)
Net Net Realized/ Asset Net Unrealized Total Dividends Dividends Value Invesetment Gain Income from from Net Excess of Net Beginning Income (Loss) on Investment Investment Investment Selected Per Share Data for the Year or of Period (Loss) Investments Operations Income Income Period Ended: Low Duration Fund II Institutional Class 03/31/2001 $ 9.69 $ 0.62 (a) $ 0.29 (a) $ 0.91 $ (0.61) $ (0.01) 03/31/2000 9.95 0.58 (a) (0.27)(a) 0.31 (0.57) 0.00 03/31/1999 10.00 0.58 (a) 0.00 (a) 0.58 (0.58) 0.00 03/31/1998 9.81 0.22 (a) 0.59 (a) 0.81 (0.56) (0.04) 03/31/1997 9.82 0.62 (0.03) 0.59 (0.58) (0.02) Administrative Class 03/31/2001 9.69 0.59 (a) 0.30 (a) 0.89 (0.59) (0.01) 03/31/2000 9.95 0.52 (a) (0.23)(a) 0.29 (0.55) 0.00 03/31/1999 10.00 0.56 (a) 0.00 (a) 0.56 (0.56) 0.00 02/02/1998 - 03/31/1998 10.03 0.14 (a) (0.08)(a) 0.06 (0.08) (0.01) Low Duration Fund III Institutional Class 03/31/2001 $ 9.66 $ 0.64 (a) $ 0.21 (a) $ 0.85 $ (0.63) $ (0.01) 03/31/2000 9.98 0.61 (a) (0.32)(a) 0.29 (0.61) 0.00 03/31/1999 10.05 0.60 (a) 0.00 (a) 0.60 (0.60) 0.00 03/31/1998 9.91 0.53 (a) 0.24 (a) 0.77 (0.60) 0.00 12/31/1996 - 03/31/1997 10.00 0.15 (0.09) 0.06 (0.15) 0.00 Administrative Class 03/31/2001 9.66 0.63 (a) 0.20 (a) 0.83 (0.61) (0.01) 03/31/2000 9.98 0.57 (a) (0.31)(a) 0.26 (0.58) 0.00 03/19/1999 - 03/31/1999 9.97 0.02 0.01 0.03 (0.02) 0.00 Short-Term Fund Institutional Class 03/31/2001 $ 9.95 $ 0.64 (a) $ 0.10 (a) $ 0.74 $ (0.64) $ 0.00 03/31/2000 10.03 0.59 (a) (0.08)(a) 0.51 (0.59) 0.00 03/31/1999 10.06 0.57 (a) (0.02)(a) 0.55 (0.57) 0.00 03/31/1998 10.00 0.62 (a) 0.06 (a) 0.68 (0.60) (0.01) 03/31/1997 9.92 0.61 0.08 0.69 (0.59) (0.02) Administrative Class 03/31/2001 9.95 0.60 (a) 0.12 (a) 0.72 (0.62) 0.00 03/31/2000 10.03 0.57 (a) (0.09)(a) 0.48 (0.56) 0.00 03/31/1999 10.06 0.54 (a) (0.02)(a) 0.52 (0.54) 0.00 03/31/1998 10.00 0.59 (a) 0.07 (a) 0.66 (0.58) (0.01) 03/31/1997 9.92 0.58 0.08 0.66 (0.57) (0.01) Money Market Fund Institutional Class 03/31/2001 $ 1.00 $ 0.06 (a) $ 0.00 (a) $ 0.06 $ (0.06) $ 0.00 03/31/2000 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 0.00 03/31/1999 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 0.00 03/31/1998 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 0.00 03/31/1997 1.00 0.05 0.00 0.05 (0.05) 0.00 Administrative Class 03/31/2001 1.00 0.06 (a) 0.00 (a) 0.06 (0.06) 0.00 03/31/2000 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 0.00 03/31/1999 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 0.00 03/31/1998 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 0.00 03/31/1997 1.00 0.05 0.00 0.05 (0.05) 0.00
+ Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) Ratio of expenses to average net assets excluding interest expense 0.50%. (c) Ratio of expenses to average net assets excluding interest expense 0.75%. (d) Ratio of expenses to average net assets excluding interest expense 0.45%. (e) Ratio of expenses to average net assets excluding interest expense 0.70%. 34 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Distributions Distributions in Excess from Net of Net Realized Realized Tax Basis Net Asset Net Assets Capital Capital Return of Total Value End Total End of Gains Gains Capital Distributions of Period Return Period (000s) $ 0.00 $ 0.00 $ 0.00 $ (0.62) $ 9.98 9.74% $ 636,542 0.00 0.00 0.00 (0.57) 9.69 3.28 467,997 0.00 (0.05) 0.00 (0.63) 9.95 5.89 414,463 (0.02) 0.00 0.00 (0.62) 10.00 8.29 401,204 0.00 0.00 0.00 (0.60) 9.81 6.33 339,375 0.00 0.00 0.00 (0.60) 9.98 9.50 82 0.00 0.00 0.00 (0.55) 9.69 3.01 71 0.00 (0.05) 0.00 (0.61) 9.95 5.63 22,594 0.00 0.00 0.00 (0.09) 10.00 0.58 56 $ 0.00 $ 0.00 $ 0.00 $ (0.64) $ 9.87 9.06% $ 42,924 0.00 0.00 0.00 (0.61) 9.66 2.98 32,349 0.00 (0.07) 0.00 (0.67) 9.98 6.10 26,549 (0.03) 0.00 0.00 (0.63) 10.05 7.93 23,896 0.00 0.00 0.00 (0.15) 9.91 0.58 10,056 0.00 0.00 0.00 (0.62) 9.87 8.82 11 0.00 0.00 0.00 (0.58) 9.66 2.71 10 0.00 0.00 0.00 (0.02) 9.98 0.15 6 $ 0.00 $ (0.02) $ 0.00 $ (0.66) $ 10.03 7.65% $ 524,693 0.00 0.00 0.00 (0.59) 9.95 5.19 589,203 0.00 (0.01) 0.00 (0.58) 10.03 5.63 495,752 (0.01) 0.00 0.00 (0.62) 10.06 7.06 172,846 0.00 0.00 0.00 (0.61) 10.00 7.12 156,515 0.00 (0.02) 0.00 (0.64) 10.03 7.40 4,610 0.00 0.00 0.00 (0.56) 9.95 4.91 15,137 0.00 (0.01) 0.00 (0.55) 10.03 5.39 3,769 (0.01) 0.00 0.00 (0.60) 10.06 6.80 5,147 0.00 0.00 0.00 (0.58) 10.00 6.86 4,513 $ 0.00 $ 0.00 $ 0.00 $ (0.06) $ 1.00 6.20% $ 135,990 0.00 0.00 0.00 (0.05) 1.00 5.21 305,016 0.00 0.00 0.00 (0.05) 1.00 5.14 322,290 0.00 0.00 0.00 (0.05) 1.00 5.40 55,335 0.00 0.00 0.00 (0.05) 1.00 5.19 23,497 0.00 0.00 0.00 (0.06) 1.00 5.94 7,165 0.00 0.00 0.00 (0.05) 1.00 4.96 9,791 0.00 0.00 0.00 (0.05) 1.00 4.93 9,273 0.00 0.00 0.00 (0.05) 1.00 5.12 749 0.00 0.00 0.00 (0.05) 1.00 4.94 12 Ratio of Net Ratio of Investment Expenses to Income (Loss) Portfolio Average Net to Average Net Turnover Assets Assets Rate 0.50% 6.37% 382% 0.57 (b) 5.88 117 0.57 (b) 5.79 322 0.50 5.98 335 0.51 6.31 237 0.75 6.06 382 1.17 (c) 5.30 117 0.85 (c) 5.47 322 0.75+ 8.53+ 335 0.50% 6.53% 419% 0.55 (b) 6.20 87 0.50 5.94 167 0.50 5.98 307 0.49+ 6.00+ 155 0.75 6.49 419 0.82 (c) 5.79 87 0.75+ 6.42+ 167 1.01%(d) 6.42% 121% 0.64 (d) 5.88 38 0.45 5.66 47 0.45 6.12 48 0.47 6.12 77 1.25 (e) 6.01 121 0.89 (e) 5.67 38 0.70 5.37 47 0.70 5.86 48 0.72 5.87 77 0.35% 6.02% N/A 0.35 5.04 N/A 0.35 4.85 N/A 0.35 5.29 N/A 0.40 5.08 N/A 0.60 5.75 N/A 0.60 4.79 N/A 0.60 4.44 N/A 0.60 5.04 N/A 0.66 4.83 N/A
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 35 Financial Highlights - Institutional Classes (Cont.)
Net Realized/ Total Net Asset Net Unrealized Income Dividends Dividends in Value Investment Gain from from Net Excess of Net Selected Per Share Data for the Year Beginning Income (Loss) on Investment Investment Investment or Period Ended: of Period (Loss) Investments Operations Income Income Long-Term U.S. Government Fund Institutional Class 03/31/2001 $ 9.79 $ 0.62 (a) $ 0.85 (a) $ 1.47 $ (0.61) $ 0.00 03/31/2000 10.30 0.61 (a) (0.50)(a) 0.11 (0.62) 0.00 03/31/1999 10.57 0.63 (a) 0.20 (a) 0.83 (0.64) 0.00 03/31/1998 9.39 0.52 (a) 1.34 (a) 1.86 (0.62) 0.00 03/31/1997 9.96 0.79 (0.35) 0.44 (0.68) 0.00 Administrative Class 03/31/2001 9.79 0.40 (a) 1.05 (a) 1.45 (0.59) 0.00 03/31/2000 10.30 0.57 (a) (0.49)(a) (0.08) (0.59) 0.00 03/31/1999 10.57 0.60 (a) 0.20 (a) 0.80 (0.61) 0.00 09/23/1997 - 03/31/1998 10.17 0.26 (a) 0.51 (a) 0.77 (0.31) 0.00 Investment Grade Corporate Bond Fund Institutional Class 04/28/2000 - 03/31/2001 $ 10.00 $ 0.72 (a) $ 0.72 (a) $ 1.44 $ (0.72) $ 0.00 High Yield Fund Institutional Class 03/31/2001 $ 10.22 $ 0.90 (a) $(0.33)(a) $ 0.57 $ (0.90) $ (0.01) 03/31/2000 11.23 0.94 (a) (1.01)(a) (0.07) (0.93) (0.01) 03/31/1999 11.66 0.95 (a) (0.43)(a) 0.52 (0.94) (0.01) 03/31/1998 11.10 0.98 (a) 0.65 (a) 1.63 (0.98) 0.00 03/31/1997 10.94 0.92 0.34 1.26 (0.97) 0.00 Administrative Class 03/31/2001 10.22 0.88 (a) (0.33)(a) 0.55 (0.88) (0.01) 03/31/2000 11.23 0.91 (a) (1.01)(a) (0.10) (0.90) (0.01) 03/31/1999 11.66 0.93 (a) (0.43)(a) 0.50 (0.92) (0.01) 03/31/1998 11.10 0.95 (a) 0.65 (a) 1.60 (0.95) 0.00 03/31/1997 10.94 0.85 (a) 0.38 (a) 1.23 (0.94) 0.00 Total Return Mortgage Fund Institutional Class 03/31/2001 $ 9.97 $ 0.63 (a) $ 0.63 (a) $ 1.26 $ (0.63) $ 0.00 03/31/2000 10.19 0.59 (a) (0.21)(a) 0.38 (0.59) 0.00 03/31/1999 10.24 0.58 (a) 0.05 (a) 0.63 (0.58) 0.00 07/31/1997 - 03/31/1998 10.00 0.41 (a) 0.30 (a) 0.71 (0.46) 0.00 GNMA Fund Institutional Class 03/31/2001 $ 9.89 $ 0.63 (a) $ 0.60 (a) $ 1.23 $ (0.63) $ 0.00 03/31/2000 10.01 0.62 (a) (0.12)(a) 0.50 (0.62) 0.00 03/31/1999 10.13 0.64 (a) (0.08)(a) 0.56 (0.64) 0.00 07/31/1997 - 03/31/1998 10.00 0.43 (a) 0.14 (a) 0.57 (0.42) 0.00 Real Return Bond Fund Institutional Class 03/31/2001 $ 9.92 $ 0.76 (a) $ 0.60 (a) $ 1.36 $ (0.80) $ 0.00 03/31/2000 9.83 0.68 (a) 0.11 (a) 0.79 (0.68) 0.00 03/31/1999 9.77 0.51 (a) 0.10 (a) 0.61 (0.48) (0.07) 03/31/1998 9.93 0.44 (a) 0.05 (a) 0.49 (0.48) (0.03) 01/29/1997 - 03/31/1997 9.92 0.11 (0.02) 0.09 (0.08) 0.00 Administrative Class 04/28/2000 - 03/31/2001 9.95 0.62 (a) 0.58 (a) 1.20 (0.67) 0.00
+ Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) Ratio of expenses to average net assets excluding interest expense 0.50%. (c) Ratio of expenses to average net assets excluding interest expense 0.76%. (d) Ratio of expenses to average net assets excluding interest expense 0.51%. (e) Ratio of expenses to average net assets excluding interest expense 0.75%. 36 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Distributions Distributions from Net in Excess of Realized Net Realized Tax Basis Net Asset Capital Capital Return of Total Value End Total Net Assets End Gains Gains Capital Distributions of Period Return of Period (000s) $ 0.00 $ 0.00 $ 0.00 $ (0.61) $ 10.65 15.52% $ 234,088 0.00 0.00 0.00 (0.62) 9.79 1.26 217,410 0.00 (0.46) 0.00 (1.10) 10.30 7.76 170,847 (0.06) 0.00 0.00 (0.68) 10.57 20.23 48,547 0.00 (0.33) 0.00 (1.01) 9.39 4.48 19,995 0.00 0.00 0.00 (0.59) 10.65 15.24 77,435 0.00 0.00 0.00 (0.59) 9.79 1.01 39,808 0.00 (0.46) 0.00 (1.07) 10.30 7.46 11,383 (0.06) 0.00 0.00 (0.37) 10.57 7.60 4,957 $ (0.04) $ 0.00 $ 0.00 $ (0.76) $ 10.68 15.00% $ 5,751 $ 0.00 $ 0.00 $ 0.00 $ (0.91) $ 9.88 5.85% $ 1,182,954 0.00 0.00 0.00 (0.94) 10.22 (0.74) 1,960,171 0.00 0.00 0.00 (0.95) 11.23 4.73 2,162,868 0.00 (0.09) 0.00 (1.07) 11.66 15.26 1,628,930 (0.13) 0.00 0.00 (1.10) 11.10 12.04 744,498 0.00 0.00 0.00 (0.89) 9.88 5.59 462,899 0.00 0.00 0.00 (0.91) 10.22 (0.99) 354,296 0.00 0.00 0.00 (0.93) 11.23 4.49 238,792 0.00 (0.09) 0.00 (1.04) 11.66 14.98 69,937 (0.13) 0.00 0.00 (1.07) 11.10 11.76 10,428 $ (0.18) $ 0.00 $ 0.00 $ (0.81) $ 10.42 13.14% $ 20,314 0.00 (0.01) 0.00 (0.60) 9.97 3.91 3,971 (0.03) (0.07) 0.00 (0.68) 10.19 6.27 4,128 (0.01) 0.00 0.00 (0.47) 10.24 6.69 3,588 $ (0.05) $ 0.00 $ 0.00 $ (0.68) $ 10.44 12.96% $ 9,963 0.00 0.00 0.00 (0.62) 9.89 5.16 4,308 0.00 (0.04) 0.00 (0.68) 10.01 5.71 4,119 (0.02) 0.00 0.00 (0.44) 10.13 5.86 3,748 $ (0.08) $ 0.00 $ 0.00 $ (0.88) $ 10.40 14.44% $ 557,849 (0.02) 0.00 0.00 (0.70) 9.92 8.37 207,826 0.00 0.00 0.00 (0.55) 9.83 6.41 15,588 (0.14) 0.00 0.00 (0.65) 9.77 4.70 5,526 0.00 0.00 0.00 (0.08) 9.93 0.09 5,638 (0.08) 0.00 0.00 (0.75) 10.40 12.70 51,359 Ratio of Net Ratio of Investment Expenses to Income (Loss) Average Net to Average Portfolio Assets Net Assets Turnover Rate 0.56%(b) 6.13% 1046% 0.57 (b) 6.29 320 0.89 (b) 5.83 364 0.51 4.88 177 0.63 7.63 402 0.80 (e) 3.91 1046 0.82 (e) 5.82 320 1.15 (c) 5.58 364 0.76+ 4.87+ 177 0.50%+ 7.54%+ 253% 0.50% 8.91% 53% 0.50 8.64 39 0.50 8.41 39 0.50 8.52 37 0.50 8.77 67 0.75 8.79 53 0.75 8.40 39 0.75 8.17 39 0.75 8.21 37 0.76 8.48 67 0.50% 6.22% 848% 0.50 5.94 1476 0.50 5.66 158 0.52+ 6.07+ 593 0.50% 6.29% 808% 1.60 (d) 6.23 952 2.37 (d) 6.35 198 1.81+(b) 6.30+ 486 0.54% 7.57% 202% 0.53 6.91 253 0.52 5.18 438 0.52 4.46 967 0.51+ 6.54+ 160 0.80+(e) 6.61+ 202
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 37 Financial Highlights - Institutional Classes (Cont.)
Net Realized/ Net Asset Unrealized Total Dividends Dividends in Value Net Gain Income from from Net Excess of Net Selected Per Share Data for the Year Beginning Investment (Loss) on Investment Investment Investment or Period Ended: of Period Income (Loss) Investments Operations Income Income Foreign Bond Fund Institutional Class 03/31/2001 $ 10.03 $ 0.58 (a) $ 0.51 (a) $ 1.09 $ (0.59) $ 0.00 03/31/2000 10.63 0.64 (a) (0.45)(a) 0.19 (0.64) 0.00 03/31/1999 10.74 0.58 (a) 0.24 (a) 0.82 (0.58) 0.00 03/31/1998 10.41 0.66 (a) 0.61 (a) 1.27 (0.63) 0.00 03/31/1997 10.50 0.80 1.00 1.80 (0.40) 0.00 Administrative Class 03/31/2001 10.03 0.55 (a) 0.51 (a) 1.06 (0.56) 0.00 03/31/2000 10.63 0.61 (a) (0.45)(a) 0.16 (0.61) 0.00 03/31/1999 10.74 0.56 (a) 0.24 (a) 0.80 (0.56) 0.00 03/31/1998 10.41 0.63 (a) 0.61 (a) 1.24 (0.60) 0.00 01/28/1997 - 03/31/1997 10.54 0.59 (0.67) (0.08) (0.05) 0.00 Global Bond Fund Institutional Class 03/31/2001 $ 9.01 $ 0.48 (a) $ (0.56)(a) $ (0.08) $ (0.06) $ 0.00 03/31/2000 9.76 0.57 (a) (0.75)(a) (0.18) (0.46) (0.06) 03/31/1999 9.70 0.52 (a) 0.14 (a) 0.66 (0.36) (0.16) 03/31/1998 9.86 0.66 (a) (0.10)(a) 0.56 (0.53) 0.00 03/31/1997 10.05 0.70 (0.01) 0.69 (0.44) 0.00 Administrative Class 03/31/2001 9.01 0.46 (a) (0.56)(a) (0.10) (0.06) 0.00 03/31/2000 9.76 0.55 (a) (0.75)(a) (0.20) (0.45) (0.05) 03/31/1999 9.70 0.51 (a) 0.14 (a) 0.65 (0.35) (0.16) 03/31/1998 9.86 0.59 (a) (0.05)(a) 0.54 (0.51) 0.00 08/01/1996 - 03/31/1997 10.28 0.51 (0.23) 0.28 (0.26) 0.00 Global Bond Fund II Institutional Class 03/31/2001 $ 9.41 $ 0.55 (a) $ 0.51 (a) $ 1.06 $ (0.56) $ 0.00 03/31/2000 9.89 0.56 (a) (0.46)(a) 0.10 (0.55) (0.01) 03/31/1999 9.92 0.52 (a) 0.06 (a) 0.58 (0.52) 0.00 02/25/1998 - 03/31/1998 9.82 0.06 (a) 0.09 (a) 0.15 0.00 (0.05) Emerging Markets Bond Fund Institutional Class 03/31/2001 $ 8.61 $ 0.82 (a) $ 0.20 (a) $ 1.02 $ (0.83) $ 0.00 03/31/2000 7.51 0.86 (a) 1.11 (a) 1.97 (0.87) 0.00 03/31/1999 9.67 0.87 (a) (2.11)(a) (1.24) (0.87) 0.00 07/31/1997 - 03/31/1998 10.00 0.46 (a) (0.18)(a) 0.28 (0.46) 0.00 Administrative Class 03/31/2001 8.61 0.80 (a) 0.20 (a) 1.00 (0.81) 0.00 03/31/2000 7.51 0.83 (a) 1.12 (a) 1.95 (0.85) 0.00 09/30/1998 - 03/31/1999 6.82 0.45 (a) 0.74 (a) 1.19 (0.45) 0.00 Strategic Balanced Fund Institutional Class 03/31/2001 $ 12.80 $ 0.90 (a) $ (1.88)(a) $ (0.98) $ (0.67) $ 0.00 03/31/2000 12.76 0.80 (a) 0.44 (a) 1.24 (0.74) 0.00 03/31/1999 12.60 0.89 (a) 0.60 (a) 1.49 (0.66) 0.00 03/31/1998 10.32 1.30 (a) 2.05 (a) 3.35 (0.84) 0.00 06/28/1996 - 03/31/1997 10.00 0.85 0.31 1.16 (0.63) 0.00 Administrative Class 03/31/2001 12.79 0.90 (a) (1.88)(a) (0.98) (0.65) 0.00 06/30/1999 - 03/31/2000 13.17 0.62 (a) 0.07 (a) 0.69 (0.61) 0.00
+ Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) Ratio of expenses to average net assets excluding interest expense 0.50%. (c) Ratio of expenses to average net assets excluding interest expense 0.75%. (d) Ratio of expenses to average net assets excluding interest expense 0.55%. 38 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Distributions Distributions from Net in Excess of Tax Basis Net Asset Realized Net Realized Return of Total Value End Net Assets End Capital Gains Capital Gains Capital Distributions of Period Total Return of Period(000s) $ 0.00 $ (0.21) $ 0.00 $ (0.80) $ 10.32 11.34% $ 482,480 (0.15) 0.00 0.00 (0.79) 10.03 1.96 421,831 (0.10) (0.25) 0.00 (0.93) 10.63 7.92 530,325 (0.31) 0.00 0.00 (0.94) 10.74 12.64 392,198 (1.49) 0.00 0.00 (1.89) 10.41 17.69 234,880 0.00 (0.21) 0.00 (0.77) 10.32 11.06 17,056 (0.15) 0.00 0.00 (0.76) 10.03 1.70 4,824 (0.10) (0.25) 0.00 (0.91) 10.63 7.65 2,096 (0.31) 0.00 0.00 (0.91) 10.74 12.34 315 0.00 0.00 0.00 (0.05) 10.41 (0.72) 30 $ 0.00 $ 0.00 $(0.42) $ (0.48) $ 8.45 (0.83)% $ 307,686 0.00 0.00 (0.05) (0.57) 9.01 (1.81) 271,538 (0.08) 0.00 0.00 (0.60) 9.76 6.90 266,984 0.00 (0.19) 0.00 (0.72) 9.70 5.85 256,274 (0.44) 0.00 0.00 (0.88) 9.86 6.78 215,631 0.00 0.00 (0.40) (0.46) 8.45 (1.07) 2,142 0.00 0.00 (0.05) (0.55) 9.01 (2.05) 2,238 (0.08) 0.00 0.00 (0.59) 9.76 6.78 1,326 0.00 (0.19) 0.00 (0.70) 9.70 5.57 1,548 (0.44) 0.00 0.00 (0.70) 9.86 2.97 346 $ (0.08) $ (0.22) $ 0.00 $ (0.86) $ 9.61 11.87% $ 62,895 (0.02) 0.00 0.00 (0.58) 9.41 1.11 84,926 (0.01) (0.08) 0.00 (0.61) 9.89 6.06 29,044 0.00 0.00 0.00 (0.05) 9.92 1.02 24,517 $ 0.00 $ (0.40) $ 0.00 $ (1.23) $ 8.40 12.94% $ 46,239 0.00 0.00 0.00 (0.87) 8.61 27.90 12,614 0.00 (0.05) 0.00 (0.92) 7.51 (12.55) 3,641 (0.15) 0.00 0.00 (0.61) 9.67 3.10 3,676 0.00 (0.40) 0.00 (1.21) 8.40 12.65 7,793 0.00 0.00 0.00 (0.85) 8.61 27.60 13,490 0.00 (0.05) 0.00 (0.50) 7.51 17.88 118 $ 0.00 $ (0.69) $ 0.00 $ (1.36) $ 10.46 (8.31)% $ 47,236 (0.15) (0.31) 0.00 (1.20) 12.80 10.05 124,934 (0.67) 0.00 0.00 (1.33) 12.76 12.36 97,945 (0.23) 0.00 0.00 (1.07) 12.60 33.40 38,806 (0.21) 0.00 0.00 (0.84) 10.32 11.83 10,360 0.00 (0.69) 0.00 (1.34) 10.47 (8.34) 488 (0.15) (0.31) 0.00 (1.07) 12.79 5.47 709
Ratio of Net Ratio of Investment Expenses to Income (Loss) Portfolio Average Net to Average Turnover Assets Net Assets Rate 0.54% 5.78% 417% 0.69 (b) 6.20 330 0.50 5.39 376 0.50 6.32 280 0.50 7.88 984 0.78 5.36 417 0.97 (c) 6.01 330 0.75 5.13 376 0.75 6.07 280 0.79+ 7.63+ 984 0.57%(d) 5.58% 416% 0.71 (d) 6.12 301 0.55 5.35 143 0.55 6.64 389 0.56 7.51 911 0.81 (e) 5.33 416 0.92 (e) 5.91 301 0.80 5.21 143 0.80 6.39 389 0.78+ 5.66+ 911 0.58%(d) 5.86% 422% 0.61 (d) 5.92 290 0.55 5.29 236 0.55+ 6.24+ 369 0.93%(f) 9.73% 902% 0.89 10.69 328 0.85 11.08 315 0.86+ 7.21+ 695 1.17 (g) 9.46 902 1.14 10.30 328 1.10+ 6.24+ 315 0.43%(h) 7.31% 651% 0.65 6.19 176 0.65 7.00 82 0.65 10.84 56 0.90+ 9.72+ 95 0.63 (h) 7.30 651 0.90+ 6.48+ 176 (e) Ratio of expenses to average net assets excluding interest expense 0.80%. (f) Ratio of expenses to average net assets excluding interest expense 0.85%. (g) Ratio of expenses to average net assets excluding interest expense 1.10%. (h) Effective September 29, 2000, the Strategic Balanced Fund did not incur advisory fee expenses. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 39 Financial Highlights - Institutional Classes (Cont.)
Net Asset Net Realized/ Total Dividends Dividends in Value Unrealized Income from from Net Excess of Net Selected Per Share Data for the Year or Beginning Net Investment Gain (Loss) on Investment Investment Investment Period Ended: of Period Income (Loss) Investments Operations Income Income Convertible Fund Institutional Class 03/31/2001 $ 15.77 $ 0.01 (a) $ (3.50)(a) $ (3.49) (0.25) $ 0.00 03/31/2000 10.00 0.07 (a) 5.97 (a) 6.04 (0.03) (0.15) Administrative Class 08/01/2000 - 03/31/2001 14.49 (0.03)(a) (2.19)(a) (2.22) (0.21) 0.00 European Convertible Fund Institutional Class 11/30/2000 - 03/31/2001 $ 10.00 $ 0.04 (a) $ (0.03)(a) $ 0.01 (0.04) $ 0.00 StocksPLUS Fund Institutional Class 03/31/2001 $ 14.15 $ 0.06 (a) $ (2.84)(a) $ (2.78) (0.26) $ 0.00 03/31/2000 14.32 1.08 (a) 1.33 (a) 2.41 (1.10) 0.00 03/31/1999 14.09 0.97 (a) 1.32 (a) 2.29 (0.82) 0.00 03/31/1998 11.46 1.90 (a) 3.23 (a) 5.13 (1.41) 0.00 03/31/1997 11.16 1.27 0.82 2.09 (1.27) 0.00 Administrative Class 03/31/2001 14.03 (0.07)(a) (2.72)(a) (2.79) (0.25) 0.00 03/31/2000 14.25 1.10 (a) 1.23 (a) 2.33 (1.07) 0.00 03/31/1999 14.06 1.10 (a) 1.13 (a) 2.23 (0.80) 0.00 03/31/1998 11.46 1.89 (a) 3.19 (a) 5.08 (1.39) 0.00 01/07/1997 - 03/31/1997 11.56 0.14 (0.09) 0.05 (0.15) 0.00 Municipal Bond Fund Institutional Class 03/31/2001 $ 9.47 $ 0.48 (a) $ 0.54 (a) $ 1.02 (0.47) $ 0.00 03/31/2000 10.12 0.46 (a) (0.65)(a) (0.19) (0.46) 0.00 03/31/1999 9.97 0.45 (a) 0.14 (a) 0.59 (0.44) 0.00 12/31/1997 - 03/31/1998 10.00 0.11 (a) (0.03)(a) 0.08 (0.11) 0.00 Administrative Class 03/31/2001 9.47 0.45 (a) 0.55 (a) 1.00 (0.45) 0.00 03/31/2000 10.12 0.44 (a) (0.65)(a) (0.21) (0.44) 0.00 09/30/1998 - 03/31/1999 10.25 0.21 (0.13) 0.08 (0.21) 0.00 Short Duration Municipal Income Fund Institutional Class 03/31/2001 $ 9.99 $ 0.45 (a) $ 0.16 (a) $ 0.61 (0.44) $ 0.00 08/31/1999 - 03/31/2000 10.00 0.23 (a) (0.01)(a) 0.22 (0.23) 0.00 California Intermediate Municipal Bond Fund Institutional Class 03/31/2001 $ 10.05 $ 0.48 (a) $ 0.56 (a) $ 1.04 (0.46) $ 0.00 08/31/1999 - 03/31/2000 10.00 0.25 (a) 0.06 (a) 0.31 (0.24) 0.00 Administrative Class 03/31/2001 10.05 0.45 (a) 0.57 (a) 1.02 (0.44) 0.00 09/07/1999 - 03/31/2000 10.02 0.22 (a) 0.05 (a) 0.27 (0.22) 0.00 California Municipal Bond Fund Institutional Class 05/16/2000 - 03/31/2001 $ 10.00 $ 0.43 (a) $ 0.78 (a) $ 1.21 (0.43) $ 0.00 New York Municipal Bond Fund Institutional Class 03/31/2001 $ 9.94 $ 0.45 (a) $ 0.79 (a) $ 1.24 (0.45) $ 0.00 08/31/1999 - 03/31/2000 10.00 0.23 (a) (0.04)(a) 0.19 (0.23) 0.00
+ Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 1.30%. (c) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 0.62%. (d) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 1.02%. (e) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 1.01%. (f) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 0.69%. (g) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 1.78%. 40 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Ratio of Net Invest- ment Income (Loss) Distributions Distributions Ratio of Average from Net in Excess of Tax Basis Net Asset Expenses to to Realized Net Realized Return of Total Value End Total Net Assets End Average Net Net Portfolio Capital Gains Capital Gains Capital Distributions of Period Return of Period (000s) Assets Assets Turnover Rate $ 0.00 $ (0.70) $ 0.00 $ (0.95) $ 11.33 (23.00)% $ 65,980 0.67% 0.08% 225% (0.09) 0.00 0.00 (0.27) 15.77 60.66 168,224 0.65(f) 0.50 247 0.00 (0.70) 0.00 (0.91) 11.36 (16.25) 322 0.90+ (0.32)+ 225 $ 0.00 $ 0.00 $ 0.00 $ (0.04) $ 9.97 0.10% $ 4,997 0.75%+(g) 1.27%+ 175% $ 0.00 $ (0.91) $ 0.00 $ (1.17) $ 10.20 (20.93)% $ 420,050 0.65% 0.48% 270% (0.97) (0.51) 0.00 (2.58) 14.15 17.82 620,144 0.65 7.42 92 (1.24) 0.00 0.00 (2.06) 14.32 17.65 512,953 0.65 6.92 81 (1.09) 0.00 0.00 (2.50) 14.09 47.75 416,600 0.65 13.74 30 (0.52) 0.00 0.00 (1.79) 11.46 19.44 235,829 0.65 11.78 47 0.00 (0.91) 0.00 (1.16) 10.08 (21.21) 35,474 0.90 (0.55) 270 (0.97) (0.51) 0.00 (2.55) 14.03 17.31 28,403 0.90 7.61 92 (1.24) 0.00 0.00 (2.04) 14.25 17.21 11,302 0.90 7.83 81 (1.09) 0.00 0.00 (2.48) 14.06 47.19 2,143 0.90 13.49 30 0.00 0.00 0.00 (0.15) 11.46 0.34 682 0.95+ 4.83+ 47 $ 0.00 $ 0.00 $ 0.00 $ (0.47) $ 10.02 11.13% $ 23,478 0.50% 4.89% 306% 0.00 0.00 0.00 (0.46) 9.47 (1.81) 5,684 0.50 4.80 145 0.00 0.00 0.00 (0.44) 10.12 6.04 5,894 0.50 4.41 70 0.00 0.00 0.00 (0.11) 9.97 0.78 3,023 0.50+ 4.46+ 60 0.00 0.00 0.00 (0.45) 10.02 10.86 4,811 0.75 4.66 306 0.00 0.00 0.00 (0.44) 9.47 (2.07) 3,141 0.75 4.58 145 0.00 0.00 0.00 (0.21) 10.12 0.83 1,419 0.75+ 2.11+ 70 $ 0.00 $ 0.00 $ 0.00 $ (0.44) $ 10.16 6.22% $ 13,645 0.40% 4.48% 208% 0.00 0.00 (0.43) (0.23) 9.99 2.19 10,725 0.39+(c) 3.92+ 171 $ (0.03) $ 0.00 $ 0.00 $ (0.49) $ 10.60 10.60% $ 87,531 0.50% 4.62% 257% (0.02) 0.00 0.00 (0.26) 10.05 3.16 8,415 0.49+(d) 4.22+ 357 (0.03) 0.00 0.00 (0.47) 10.60 10.36 1,717 0.74 4.28% 257 (0.02) 0.00 0.00 (0.24) 10.05 2.73 10 0.75+(e) 3.95+ 357 $ (0.43) $ 0.00 $ 0.00 $ (0.86) $ 10.35 12.49% $ 11,941 0.49%+ 4.76%+ 338% $ (0.09) $ 0.00 $ 0.00 $ (0.54) $ 10.64 12.77% $ 3,753 0.50% 4.41% 973% (0.02) 0.00 (0.21) (0.25) 9.94 1.93 3,058 0.49+(b) 4.00+ 270
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 41 Statements of Assets and Liabilities March 31, 2001
Total Total Total Moderate Low Amounts in thousands, except per share amounts Return Fund Return Fund II Return Fund III Duration Fund Duration Fund Assets: Investments, at value $ 64,127,213 $ 2,516,683 $1,233,379 $ 919,646 $ 8,365,786 Cash and foreign currency 218,324 0 7,976 1,531 4,017 Receivable for investments sold and forward foreign currency contracts 4,821,384 204,694 185,821 66,585 843,152 Receivable for Fund shares sold 249,896 684 2,918 1,647 11,388 Variation margin receivable 8,311 480 50 23 85 Interest and dividends receivable 476,095 19,784 8,445 6,328 59,063 Manager reimbursement receivable 0 0 0 0 0 Other assets 1,125 3,648 682 0 343 69,902,348 2,745,973 1,439,271 995,760 9,283,834 ----------------------------------------------------------------------------------------------------------------------------------- Liabilities: Payable for investments purchased and forward foreign currency contracts $ 21,420,265 $ 1,033,329 $ 438,557 $ 359,043 $ 3,405,245 Payable for financing transactions 5,667,668 17,162 34,622 56,906 348,283 Payable for short sales 0 0 83,287 0 703,503 Due to Custodian 0 84 0 0 0 Notes payable 0 0 0 35 156,287 Written options outstanding 42,637 794 918 0 2,050 Payable for Fund shares redeemed 134,060 5,767 100 1,695 57,470 Dividends payable 46,539 1,940 390 143 3,541 Accrued investment advisory fee 9,171 379 193 122 1,001 Accrued administration fee 7,573 379 193 98 813 Accrued distribution fee 3,345 15 2 0 134 Accrued servicing fee 1,139 0 0 0 107 Variation margin payable 3,094 23 0 5 0 Other liabilities 61,464 1,920 1,029 802 2,111 27,396,955 1,061,792 559,291 418,849 4,680,545 ----------------------------------------------------------------------------------------------------------------------------------- Net Assets $ 42,505,393 $1,684,181 $ 879,980 $ 576,911 $ 4,603,289 ----------------------------------------------------------------------------------------------------------------------------------- Net Assets Consist of: Paid in capital $ 41,959,747 $1,647,997 $ 878,077 $ 571,845 $ 4,630,511 Undistributed (overdistributed) net investment income 154,725 6,386 (3,786) 347 254 Accumulated undistributed net realized gain (loss) (48,115) 151 (7,946) (1,175) (47,743) Net unrealized appreciation (depreciation) 439,036 29,647 13,635 5,894 20,267 $ 42,505,393 $1,684,181 $ 879,980 $ 576,911 $ 4,603,289 ----------------------------------------------------------------------------------------------------------------------------------- Net Assets: Institutional Class $ 31,746,629 $ 1,606,998 $ 868,757 $ 576,911 $ 3,950,592 Administrative Class 5,353,222 77,183 11,223 0 151,774 Other Classes 5,405,542 0 0 0 500,923 Shares Issued and Outstanding: Institutional Class 3,018,109 156,450 94,576 57,714 393,925 Administrative Class 508,925 7,514 1,222 0 15,134 Net Asset Value and Redemption Price Per Share (Net Assets Per Share Outstanding) Institutional Class $ 10.52 $ 10.27 $ 9.19 $ 10.00 $ 10.03 Administrative Class 10.52 10.27 9.19 0.00 10.03 Cost of Investments Owned $ 63,623,558 $ 2,488,975 $1,221,138 $ 914,575 $ 8,337,219 ----------------------------------------------------------------------------------------------------------------------------------- Cost of Foreign Currency Held $ 274,176 $ 0 $ 8,209 $ 1,244 $ 4,446 -----------------------------------------------------------------------------------------------------------------------------------
42 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Low Low Investment Duration Duration Short-Term Money Long-Term Grade Corporate Total Return Fund II Fund III Fund Market Fund U.S. Gov't Fund Bond Fund High Yield Fund Mortgage Fund GNMA Fund $ 1,134,937 $ 74,729 $1,158,227 $ 350,038 $ 699,912 $ 5,676 $ 2,551,020 $ 37,190 $ 16,952 0 53 1,003 159 91 1 5,303 1,197 16 56,028 435 294,322 0 104,544 645 35,585 10,581 25,018 2 0 7,914 6,947 2,148 0 37,429 72 40 0 0 0 0 496 4 0 0 0 6,174 412 11,006 551 7,109 114 48,416 109 116 0 0 0 0 0 0 0 0 0 59 2 253 0 7 1 13,788 1 9 1,197,200 75,631 1,472,725 357,695 814,307 6,441 2,691,541 49,150 42,151 ----------------------------------------------------------------------------------------------------------------------------------- $ 508,287 $ 30,732 $ 4,077 $ 1,047 $ 53,214 $ 14 $ 37,218 $ 24,016 $ 29,061 51,563 1,907 443,596 0 274,830 672 0 0 3,100 0 0 295,950 0 0 0 0 0 0 2 0 0 0 0 0 0 0 0 0 0 72,131 0 0 0 0 0 0 0 24 0 0 849 0 0 0 0 99 0 3,537 7,514 1,881 0 3,479 49 2 313 1 834 40 554 0 5,404 3 10 144 9 140 42 109 1 578 5 2 139 9 127 79 129 1 709 6 2 0 0 11 23 70 0 556 0 0 0 0 26 20 36 0 218 3 0 29 0 5 0 366 0 0 0 0 0 14 1,118 0 1,220 2 1,237 0 0 560,576 32,696 821,552 8,765 333,258 690 49,399 24,082 32,177 ----------------------------------------------------------------------------------------------------------------------------------- $ 636,624 $ 42,935 $ 651,173 $ 348,930 $ 481,049 $ 5,751 $ 2,642,142 $ 25,068 $ 9,974 ----------------------------------------------------------------------------------------------------------------------------------- $ 631,009 $ 43,020 $ 650,737 $ 348,908 $ 473,798 $ 5,397 $ 3,109,817 $ 24,059 $ 9,473 (437) (3) (1,518) 22 57 126 (1,912) 382 303 (2,950) (501) (868) 0 (2,646) 13 (300,146) (1) (6) 9,002 419 2,822 0 9,840 215 (165,617) 628 204 $ 636,624 $ 42,935 $ 651,173 $ 348,930 $ 481,049 $ 5,751 $ 2,642,142 $ 25,068 $ 9,974 ----------------------------------------------------------------------------------------------------------------------------------- $ 636,542 $ 42,924 $ 524,693 $ 135,990 $ 234,088 $ 5,751 $ 1,182,954 $ 20,314 $ 9,963 82 11 4,610 7,165 77,435 0 462,899 0 0 0 0 121,870 205,775 169,526 0 996,289 4,754 11 63,800 4,345 52,325 135,991 21,985 538 119,787 1,949 955 8 1 460 7,165 7,273 0 46,874 0 0 $ 9.98 $ 9.87 $ 10.03 $ 1.00 $ 10.65 $ 10.68 $ 9.88 $ 10.42 $ 10.44 9.98 9.87 10.03 1.00 10.65 0.00 9.88 0.00 0.00 $ 1,125,719 $ 74,223 $1,152,292 $ 350,038 $ 686,690 $ 5,447 $ 2,716,720 $ 36,562 $ 16,748 ----------------------------------------------------------------------------------------------------------------------------------- $ 0 $ 55 $ 991 $ 0 $ 0 $ 0 $ 2,627 $ 0 $ 0 -----------------------------------------------------------------------------------------------------------------------------------
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 43 Statements of Assets and Liabilities (Cont.) March 31, 2001
Emerging Real Return Foreign Global Global Markets Amounts in thousands, except per share amounts Bond Fund Bond Fund Bond Fund Bond Fund II Bond Fund Assets: Investments, at value $ 1,558,398 $ 1,040,636 $ 514,059 $ 124,305 $ 58,386 Cash and foreign currency 1,977 37,332 18,582 5,419 0 Receivable for investments sold and forward foreign 96,777 84,303 63,844 8,140 16,961 currency contracts Receivable for Fund shares sold 10,321 1,594 0 29 7 Variation margin receivable 0 0 0 0 0 Interest and dividends receivable 14,895 16,720 7,572 2,153 1,237 Manager reimbursement receivable 0 0 0 0 0 Other assets 764 1,681 1,310 602 0 1,683,132 1,182,266 605,367 140,648 76,591 ----------------------------------------------------------------------------------------------------------------------------- Liabilities: Payable for investments purchased and forward $ 22,680 $ 57,126 $ 57,509 $ 5,756 $ 14,857 foreign currency contracts Payable for financing transactions 756,305 446,311 231,075 58,408 1,449 Due to Custodian 0 0 0 0 2,498 Notes payable 0 0 0 0 0 Written options outstanding 0 2,046 922 141 0 Payable for Fund shares redeemed 2,000 999 5,119 14 92 Dividends payable 1,075 362 309 34 29 Accrued investment advisory fee 184 147 72 17 23 Accrued administration fee 218 177 86 22 21 Accrued distribution fee 73 45 0 7 3 Accrued servicing fee 57 38 0 3 1 Variation margin payable 27 173 163 60 0 Other liabilities 1,391 1 284 93 20 784,010 507,425 295,539 64,555 18,993 ----------------------------------------------------------------------------------------------------------------------------- Net Assets $ 899,122 $ 674,841 $ 309,828 $ 76,093 $ 57,598 ----------------------------------------------------------------------------------------------------------------------------- Net Assets Consist of: Paid in capital $ 862,868 $ 680,856 $ 355,769 $ 76,688 $ 55,779 Undistributed (overdistributed) net investment income 3,210 (789) (9,899) (37) 1,525 Accumulated undistributed net realized gain (loss) (786) (7,969) (7,960) (896) (486) Net unrealized appreciation (depreciation) 33,830 2,743 (8,082) 338 780 $ 899,122 $ 674,841 $ 309,828 $ 76,093 $ 57,598 ----------------------------------------------------------------------------------------------------------------------------- Net Assets: Institutional Class $ 557,849 $ 482,480 $ 307,686 $ 62,895 $ 46,239 Administrative Class 51,359 17,056 2,142 0 7,793 Other Classes 289,914 173,305 0 13,198 3,566 Shares Issued and Outstanding: Institutional Class 53,640 46,735 36,415 6,545 5,496 Administrative Class 4,938 1,652 253 0 926 Net Asset Value and Redemption Price Per Share (Net Assets Per Share Outstanding) Institutional Class $ 10.40 $ 10.32 $ 8.45 $ 9.61 $ 8.40 Administrative Class 10.40 10.32 8.45 0.00 8.40 Cost of Investments Owned $ 1,524,018 $ 1,061,915 $ 522,425 $ 127,242 $ 57,651 ----------------------------------------------------------------------------------------------------------------------------- Cost of Foreign Currency Held $ 431 $ 37,473 $ 19,316 $ 4,846 $ 0 -----------------------------------------------------------------------------------------------------------------------------
44 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
California European Short Duration Intermediate California New York Strategic Convertible Convertible StocksPLUS Municipal Municipal Municipal Municipal Municipal Balanced Fund Fund Fund Fund Bond Fund Income Fund Bond Fund Bond Fund Bond Fund $ 73,945 $ 86,394 $ 4,806 $ 1,543,635 $ 84,850 $ 13,076 $ 119,480 $ 12,320 $ 3,973 716 0 6 3,850 2 2 2 140 1 0 19,247 161 16,915 0 330 0 0 0 43 641 0 752 318 0 144 0 0 0 0 0 5,075 0 0 0 3 0 172 393 26 2,449 1,041 245 1,737 172 66 0 10 0 0 0 13 14 29 14 0 1 17 4 1 0 0 0 0 74,876 106,686 5,016 1,572,680 86,212 13,666 121,377 12,664 4,054 -------------------------------------------------------------------------------------------------------------------------------- $ 251 $ 38 $ 6 $ 535,113 $ 5,647 $ 0 $ 2,738 $ 0 $ 0 0 0 0 392 0 0 0 0 0 0 1,604 0 0 0 0 0 0 0 0 0 0 383 0 0 0 0 0 0 0 0 815 0 0 0 0 0 89 13,251 0 18,316 282 6 37 0 0 0 0 0 10 78 0 58 1 0 0 50 2 368 17 2 27 3 1 11 34 1 306 21 2 28 3 1 15 13 0 266 20 0 0 0 0 6 6 0 128 11 0 6 0 0 0 0 0 275 0 0 14 0 0 0 0 0 825 0 0 5 0 0 372 14,996 9 557,197 6,076 10 2,913 7 2 -------------------------------------------------------------------------------------------------------------------------------- $ 74,504 $ 91,690 $ 5,007 $ 1,015,483 $ 80,136 $ 13,656 $ 118,464 $ 12,657 $ 4,052 -------------------------------------------------------------------------------------------------------------------------------- $ 87,158 $ 110,156 $ 5,020 $ 1,334,218 $ 77,328 $ 13,435 $ 112,219 $ 12,066 $ 3,843 465 (1,336) 94 (26,538) 17 31 1,115 152 66 (2,315) (8,984) 0 (271,284) 363 2 (68) 11 29 (10,804) (8,146) (107) (20,913) 2,428 188 5,198 428 114 $ 74,504 $ 91,690 $ 5,007 $ 1,015,483 $ 80,136 $ 13,656 $ 118,464 $ 12,657 $ 4,052 -------------------------------------------------------------------------------------------------------------------------------- $ 47,236 $ 65,980 $ 4,997 $ 420,050 $ 23,478 $ 13,645 $ 87,531 $ 11,941 $ 3,753 488 322 0 35,474 4,811 0 1,717 0 0 26,780 25,388 10 559,959 51,847 11 29,216 716 299 4,513 5,825 501 41,167 2,343 1,343 8,260 1,154 353 47 28 0 3,514 480 0 162 0 0 $ 10.46 $ 11.33 $ 9.97 $ 10.20 $ 10.02 $ 10.16 $ 10.60 $ 10.35 $ 10.64 10.47 11.36 0.00 10.08 10.02 0.00 10.60 0.00 0.00 $ 84,847 $ 94,684 $ 5,013 $ 1,541,379 $ 82,422 $ 12,888 $ 114,374 $ 11,884 $ 3,859 -------------------------------------------------------------------------------------------------------------------------------- $ 561 $ 22 $ 7 $ 3,832 $ 0 $ 0 $ 0 $ 0 $ 0 --------------------------------------------------------------------------------------------------------------------------------
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 45 Statements of Operations For the year ended March 31, 2001
Total Total Total Return Return Moderate Low Amounts in thousands Return Fund Fund II Fund III Duration Fund Duration Fund Investment Income: Interest $ 2,508,225 $ 103,906 $ 54,967 $ 32,680 $ 305,644 Dividends, net of foreign taxes 32,065 2 321 462 7,445 Miscellaneous income 104 0 0 0 0 Total Income 2,540,394 103,908 55,288 33,142 313,089 Expenses: Investment advisory fees 89,506 3,840 1,970 1,179 10,648 Administration fees 73,048 3,840 1,971 943 8,636 Distribution and/or servicing fees - Administrative 9,918 157 27 0 345 Class Distribution and/or servicing fees - Other Classes 21,658 0 0 0 2,257 Trustees' fees 196 9 4 3 23 Organization costs 0 0 0 0 0 Interest expense 21,417 101 116 1 2,684 Miscellaneous 0 1 1 1 0 Total expenses 215,743 7,948 4,089 2,127 24,593 Net Investment Income (Loss) 2,324,651 95,960 51,199 31,015 288,496 ---------------------------------------------------------------------------------------------------------------------------------- Net Realized and Unrealized Gain (Loss): Net realized gain (loss) on investments 982,913 49,396 17,060 10,783 7,880 Net realized gain (loss) on futures contracts and 248,438 8,225 6,190 2,821 (37) written options Net realized gain (loss) on foreign currency (4,989) (3) (3,082) 461 9,157 transactions Net change in unrealized appreciation 800,434 39,064 21,075 8,853 81,101 (depreciation) on investments Net change in unrealized appreciation (depreciation) on futures contracts and written options (6,524) (2,697) (1,383) (1,233) 2,894 Net change in unrealized appreciation (depreciation) on translation of assets and liabilities 1,460 3 2,087 1,791 (3,086) denominated in foreign currencies Net Gain (Loss) 2,021,732 93,988 41,947 23,476 97,909 Net Increase in Assets Resulting from Operations $ 4,346,383 $ 189,948 $ 93,146 $ 54,491 $ 386,405 ----------------------------------------------------------------------------------------------------------------------------------
46 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Low Low Long-Term Investment Total Return Duration Duration Short-Term Money U.S. Gov't Grade Corporate Mortgage Fund II Fund III Fund Market Fund Fund Bond Fund High Yield Fund Fund GNMA Fund $ 41,504 $ 2,827 $ 50,985 $ 25,415 $ 26,931 $ 398 $ 262,112 $ 1,127 $ 582 344 0 0 0 0 0 7,951 0 0 0 0 0 0 0 0 60 0 1 41,848 2,827 50,985 25,415 26,931 398 270,123 1,127 583 1,517 100 1,707 596 1,026 12 7,084 42 20 1,513 100 1,530 1,056 1,199 12 8,316 44 20 0 0 17 21 117 0 1,054 0 0 0 0 390 392 765 0 6,827 9 0 3 0 4 2 2 0 15 0 0 0 0 0 0 0 0 0 0 0 30 5 3,817 6 231 0 0 5 0 2 0 1 0 1 0 5 0 0 3,065 205 7,466 2,073 3,341 24 23,301 100 40 38,783 2,622 43,519 23,342 23,590 374 246,822 1,027 543 ---------------------------------------------------------------------------------------------------------------------------------- 4,243 145 1,431 0 25,791 111 (237,944) 741 286 79 19 (93) 0 3,792 52 0 10 0 0 (9) (1,134) 0 0 (1) (42) 0 0 14,449 837 6,058 0 6,963 230 111,549 651 290 33 (3) 88 0 (649) (2) 0 (2) 0 0 (66) 36 0 0 (13) 45 0 0 18,804 923 6,386 0 35,897 377 (126,392) 1,400 576 $ 57,587 $ 3,545 $ 49,905 $ 23,342 $ 59,487 $ 751 $ 120,430 $ 2,427 $ 1,119 ----------------------------------------------------------------------------------------------------------------------------------
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 47 Statements of Operations (Cont.) For the year ended March 31, 2001
Emerging Real Return Foreign Global Global Markets Amounts in thousands Bond Fund Bond Fund Bond Fund Bond Fund II Bond Fund Investment Income: Interest $ 44,071 $ 37,119 $ 18,004 $ 4,966 $ 5,027 Dividends, net of foreign taxes 11 480 158 53 1 Miscellaneous income 0 0 0 0 0 Total Income 44,082 37,599 18,162 5,019 5,028 Expenses: Investment advisory fees 1,358 1,478 732 192 211 Administration fees 1,559 1,758 878 247 192 Distribution and/or servicing fees - Administrative Class 41 19 6 0 25 Distribution and/or servicing fees - Other Classes 704 780 0 99 18 Trustees' fees 3 3 1 0 0 Organization costs 2 0 0 0 0 Interest expense 217 245 58 27 36 Miscellaneous 2 0 0 0 5 Total expenses 3,886 4,283 1,675 565 487 Reimbursement by Manager 0 0 0 0 0 Net expenses 3,886 4,283 1,675 565 487 Net Investment Income (loss) 40,196 33,316 16,487 4,454 4,541 ------------------------------------------------------------------------------------------------------------------------------- Net Realized and Unrealized Gain (Loss): Net realized gain (loss) on investments 6,609 15,252 6,877 2,780 2,776 Net capital gain distributions received from underlying funds 0 0 0 0 0 Net realized gain (loss) on futures contracts and written options 338 (5,763) (1,791) (178) 0 Net realized gain (loss) on foreign currency transactions 624 (10,379) (23,842) (131) (76) Net change in unrealized appreciation (depreciation) on investments 29,647 14,127 2,847 (568) (717) Net change in unrealized appreciation (depreciation) on futures contracts and written options 83 (2,938) (1,214) (673) 0 Net change in unrealized appreciation (depreciation) on translation of assets and liabilities denominated in foreign currencies 495 20,756 (1,988) 2,599 59 Net Gain (Loss) 37,796 31,055 (19,111) 3,829 2,042 Net Increase (Decrease) in Assets Resulting from Operations $ 77,992 $ 64,371 $ (2,624) $ 8,283 $ 6,583 -------------------------------------------------------------------------------------------------------------------------------
48 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
California European Short Duration Intermediate California New York Strategic Convertible Convertible StocksPLUS Municipal Municipal Municipal Municipal Municipal Balanced Fund Fund Fund Fund Bond Fund Income Fund Bond Fund Bond Fund Bond Fund $ 3,393 $ (607) $ 30 $ 12,663 $ 3,329 $ 643 $ 4,804 $ 484 $ 162 2,414 1,708 2 1,152 0 0 0 0 0 0 0 2 45 3 0 1 3 0 5,807 1,101 34 13,860 3,332 643 4,805 487 162 217 592 8 5,319 153 26 236 24 8 224 407 4 4,439 196 25 257 22 8 1 1 0 88 10 0 4 0 0 243 188 0 5,631 294 0 68 0 0 0 1 0 7 0 0 0 0 0 0 0 18 0 0 0 0 29 0 14 27 0 0 0 1 0 0 0 0 7 0 3 0 1 5 0 0 699 1,223 30 15,487 653 53 570 75 16 0 0 (17) 0 0 0 0 (29) 0 699 1,223 13 15,487 653 53 570 46 16 5,108 (122) 21 (1,627) 2,679 590 4,235 441 146 ---------- ------------ ------- ------------ ----------- --------- ----------- ----------- --------- (1,201) (6,937) 133 4,385 1,370 34 1,557 531 101 1,770 0 0 0 0 0 0 0 0 3,916 0 0 (183,594) (72) 7 (279) 13 31 (972) 212 (40) (403) 0 0 0 0 0 (9,323) (36,311) (207) 6,605 2,568 182 5,034 436 122 (6,479) 0 0 (119,526) 0 0 92 (8) 0 72 199 100 4,312 0 0 0 0 0 (12,217) (42,837) (14) (288,221) 3,866 223 6,404 972 254 $ (7,109) $ (42,959) $ 7 $ (289,848) $ 6,545 $ 813 $ 10,639 $ 1,413 $ 400 ---------- ------------ ------- ------------ ----------- --------- ----------- ----------- ---------
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 49 Statements of Changes in Net Assets
Amounts in thousands Total Return Fund Total Return Fund II Total Return Fund III Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended Increase (Decrease) in Net Assets from: March 31, March 31, March 31, March 31, March 31, March 31, 2001 2000 2001 2000 2001 2000 Operations: Net investment income $ 2,324,651 $ 1,778,306 $ 95,960 $ 70,516 $ 51,199 $ 35,645 Net realized gain (loss) 1,226,362 (847,388) 57,618 (42,778) 20,168 (23,356) Net change in unrealized appreciation (depreciation) 795,370 (242,138) 36,370 (7,102) 21,779 (8,493) Net increase resulting from operations 4,346,383 688,780 189,948 20,636 93,146 3,796 ----------------------------------------- ------------------------------ ----------------------------- ------------------------ Distributions to Shareholders: From net investment income Institutional Class (1,792,734) (1,382,515) (91,365) (67,517) (49,458) (34,948) Administrative Class (245,683) (158,773) (3,756) (2,814) (646) (210) Other Classes (228,334) (159,950) 0 0 0 0 In excess of net investment income Institutional Class (49,037) (59,361) (803) (172) (1,051) (514) Administrative Class (6,720) (6,817) (33) (7) (14) (3) Other Classes (6,245) (6,868) 0 0 0 0 From net realized capital gains Institutional Class 0 0 0 0 0 0 Administrative Class 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 In excess of net realized capital gains Institutional Class 0 0 0 0 0 0 Administrative Class 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 Tax basis return of capital Institutional Class 0 0 0 0 0 0 Administrative Class 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 Total Distributions (2,328,753) (1,774,284) (95,957) (70,510) (51,169) (35,675) ----------------------------------------- ------------------------------ ----------------------------- ------------------------ Fund Share Transactions: Receipts for shares sold Institutional Class 10,686,192 9,137,242 570,675 653,040 221,365 246,232 Administrative Class 2,801,443 2,193,159 62,044 31,950 163 8,282 Other Classes 2,858,874 2,171,970 0 0 0 0 Issued in reorganization Institutional Class 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 Issued as reinvestment of distributions Institutional Class 1,529,088 1,172,270 71,901 55,668 46,166 32,584 Administrative Class 198,869 113,239 3,782 2,786 637 195 Other Classes 123,077 128,441 0 0 0 0 Cost of shares redeemed Institutional Class (6,936,468) (6,242,527) (389,100) (384,235) (75,805) (99,748) Administrative Class (1,104,430) (953,360) (49,423) (30,450) (259) (40) Other Classes (1,205,155) (1,223,161) 0 0 0 0 Net increase (decrease) resulting from Fund 8,951,490 6,497,273 269,879 328,759 192,267 187,505 share transactions Total Increase (Decrease) in Net Assets 10,969,120 5,411,769 363,870 278,885 234,244 155,626 ----------------------------------------- ------------------------------ ----------------------------- ------------------------ Net Assets: Beginning of period 31,536,273 26,124,504 1,320,311 1,041,426 645,736 490,110 End of period * $42,505,393 $ 31,536,273 $ 1,684,181 $ 1,320,311 $ 879,980 $ 645,736 *Including net undistributed (overdistributed) investment income of: $ 154,725 $ (57,894)$ 6,386 $ (839) $ (3,786)$ (794)
50 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Moderate Duration Fund Low Duration Fund Low Duration Fund II Low Duration Fund III Short-Term Fund Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended March 31, March 31, March 31, March 31, March 31, March 31, March 31, March 31, March 31, March 31, 2001 2000 2001 2000 2001 2000 2001 2000 2001 2000 $ 31,015 $ 21,172 $ 288,496 $ 265,005 $ 38,783 $ 27,138 $ 2,622 $ 1,716 $ 43,519 $ 37,374 14,065 (11,288) 17,000 (47,944) 4,322 (4,803) 155 (484) 204 (1,776) 9,411 (3,092) 80,909 (75,164) 14,482 (7,461) 768 (416) 6,182 (3,309) 54,491 6,792 386,405 141,897 57,587 14,874 3,545 816 49,905 32,289 ---------------------- ------------------------ ---------------------- ------------------------ ------------------------- (30,778) (20,651) (244,452) (229,827) (38,384) (26,955) (2,587) (1,701) (36,353) (31,112) 0 0 (8,855) (7,443) (2) (11) (1) (1) (407) (342) 0 0 (26,799) (23,729) 0 0 0 0 (6,739) (5,911) (191) (532) (7,347) (3,479) (435) (132) (35) (13) 0 0 0 0 (266) (112) 0 0 0 0 0 0 0 0 (806) (359) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (878) 0 0 0 0 0 0 0 0 0 (6) 0 0 0 0 0 0 0 0 0 (177) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (30,969) (21,183) (288,525) (264,949) (38,821) (27,098) (2,623) (1,715) (44,560) (37,365) ---------------------- ------------------------ ---------------------- ------------------------ ------------------------- 271,662 200,422 2,441,784 2,852,869 394,918 136,132 25,072 12,807 557,919 1,202,372 0 0 98,789 87,882 82 251 0 46 7,559 17,721 0 0 318,860 534,201 0 0 0 0 118,255 138,529 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 30,441 20,913 220,160 199,668 35,794 25,816 2,621 1,702 28,548 21,902 0 0 8,907 7,388 1 12 1 1 271 234 0 0 18,884 18,941 0 0 0 0 4,561 4,967 (135,840) (137,218) (2,235,908) (2,872,755) (280,932) (96,194) (18,040) (7,810) (655,344) (1,126,670) 0 0 (78,115) (100,890) (73) (22,782) 0 (43) (18,406) (6,533) 0 0 (278,280) (485,171) 0 0 0 0 (106,536) (140,433) 166,263 84,117 515,081 242,133 149,790 43,235 9,654 6,703 (63,173) 112,089 189,785 69,726 612,961 119,081 168,556 31,011 10,576 5,804 (57,828) 107,013 ---------------------- ------------------------ ---------------------- ------------------------ ------------------------- 387,126 317,400 3,990,328 3,871,247 468,068 437,057 32,359 26,555 709,001 601,988 $ 576,911 $ 387,126 $ 4,603,289 $ 3,990,328 $ 636,624 $ 468,068 $ 42,935 $ 32,359 $ 651,173 $ 709,001 $ 347 $ (236) $ 254 $ (8,390) $ (437) $ (397) $ (3) $ (28) $ (1,518) $ 356
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 51 Statements of Changes in Net Assets (Cont.)
Investment Grade Corporate Amounts in thousands Money Market Fund Long-Term U.S. Gov't Fund Bond Fund High Yield Fund Period from April 28, Year Ended Year Ended Year Ended Year Ended 2000 to Year Ended Year Ended Increase (Decrease) in Net Assets March 31, March 31, March 31, March 31, March 31, March 31, March 31, from: 2001 2000 2001 2000 2001 2001 2000 Operations: Net investment income $ 23,342 $ 24,929 $ 23,590 $ 20,805 $ 374 $ 246,822 $ 296,022 Net realized gain (loss) 0 0 29,583 (25,059) 162 (237,986) (70,452) Net change in unrealized appreciation (depreciation) 0 0 6,314 7,958 215 111,594 (263,887) Net increase (decrease) resulting from operations 23,342 24,929 59,487 3,704 751 120,430 (38,317) ------------------------------------ ----------------------- ------------------------- --------- ------------------------------ Distributions to Shareholders: From net investment income Institutional Class (12,927) (14,268) (14,794) (13,162) (374) (139,311) (199,017) Administrative Class (486) (431) (2,737) (2,387) 0 (36,974) (25,769) Other Classes (9,927) (10,224) (6,050) (5,222) 0 (68,547) (68,953) In excess of net investment income Institutional Class 0 0 0 0 0 (1,064) (1,453) Administrative Class 0 0 0 0 0 (282) (188) Other Classes 0 0 0 0 0 (523) (503) From net realized capital gains Institutional Class 0 0 0 0 (23) 0 0 Administrative Class 0 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 0 In excess of net realized capital gains Institutional Class 0 0 0 0 0 0 0 Administrative Class 0 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 0 Tax basis return of capital Institutional Class 0 0 0 0 0 0 0 Administrative Class 0 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 0 Total Distributions (23,340) (24,923) (23,581) (20,771) (397) (246,701) (295,883) ------------------------------------ ----------------------- ------------------------- --------- ------------------------------ Fund Share Transactions: Receipts for shares sold Institutional Class 145,605 382,805 185,685 170,823 5,000 792,834 1,221,190 Administrative Class 16,510 45,030 61,908 47,739 0 224,073 255,416 Other Classes 2,312,653 6,791,637 122,155 66,187 0 522,135 597,715 Issued in reorganization Institutional Class 0 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 0 Issued as reinvestment of distributions Institutional Class 12,820 14,008 11,990 10,760 397 116,900 176,340 Administrative Class 485 426 2,736 2,386 0 37,198 25,317 Other Classes 7,633 6,923 3,801 3,859 0 34,732 40,061 Cost of shares redeemed Institutional Class (327,450) (414,090) (204,230) (124,451) 0 (1,605,873) (1,380,777) Administrative Class (19,622) (44,939) (30,338) (20,024) 0 (138,474) (135,307) Other Classes (2,341,229) (6,778,173) (63,811) (66,603) 0 (385,505) (518,612) Net increase (decrease) resulting from Fund share transactions (192,595) 3,627 89,896 90,676 5,397 (401,980) 281,343 Total Increase (Decrease) in Net Assets (192,593) 3,633 125,802 73,609 5,751 (528,251) (52,857) ------------------------------------ ----------------------- ------------------------- --------- ------------------------------ Net Assets: Beginning of period 541,523 537,890 355,247 281,638 0 3,170,393 3,223,250 End of period * $ 348,930 $ 541,523 $ 481,049 $ 355,247 $ 5,751 $ 2,642,142 $ 3,170,393 *Including net undistributed (overdistributed) investment income of: $ 22 $ 20 $ 57 $ 45 $ 126 $ (1,912) $ (1,991)
52 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Total Return Mortgage FundGNMA Fund Real Return Bond Fund Foreign Bond Fund Global Bond Fund Year Year Year Year Year Year Year Year Year Year Ended Ended Ended Ended Ended Ended Ended Ended Ended Ended March 31, March 31, March 31, March 31, March 31, March 31, March 31, March 31, March 31, March 31, 2001 2000 2001 2000 2001 2000 2001 2000 2001 2000 $ 1,027 $ 238 $ 543 $ 260 $ 40,196 $ 7,689 $ 33,316 $ 35,220 $ 16,487 $ 16,673 751 (6) 286 35 7,571 317 (890) 4,992 (18,756) (18,971) 649 (78) 290 (86) 30,225 3,722 31,945 (31,738) (355) (2,619) 2,427 154 1,119 209 77,992 11,728 64,371 8,474 (2,624) (4,917) -------------------- ------------------- ---------------------- ---------------------- -------------------------- (949) (232) (510) (260) (29,970) (5,631) (25,707) (29,183) (2,208) (13,418) 0 0 0 0 (1,102) 0 (405) (256) (16) (139) (78) (6) 0 0 (9,225) (1,905) (7,021) (5,738) 0 0 0 0 0 0 0 0 0 0 0 (1,627) 0 0 0 0 0 0 0 0 0 (17) 0 0 0 0 0 0 0 0 0 0 (324) 0 (54) 0 (3,779) (226) 0 (3,818) 0 0 0 0 0 0 (129) 0 0 (40) 0 0 (39) 0 0 0 (1,301) (67) 0 (967) 0 0 0 (3) 0 0 0 0 (9,671) (2,885) 0 0 0 0 0 0 0 0 (138) (31) 0 0 0 0 0 0 0 0 (3,061) (731) 0 0 0 0 0 0 0 0 0 0 (14,074) (1,534) 0 0 0 0 0 0 0 0 (104) (16) 0 0 0 0 0 0 0 0 0 0 (1,390) (241) (564) (260) (45,506) (7,829) (46,003) (43,649) (16,402) (16,751) -------------------- ------------------- ---------------------- ---------------------- -------------------------- 19,192 51 9,067 27 412,572 197,599 172,052 178,740 150,687 90,144 0 0 0 0 62,788 0 14,864 4,784 2,952 7,497 5,324 176 10 0 242,511 55,389 81,245 76,013 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1,270 235 530 261 30,496 4,405 31,126 28,907 11,553 10,736 0 0 0 0 1,223 0 540 324 123 172 104 5 0 0 7,495 1,416 8,494 6,155 0 0 (5,092) (342) (4,496) (48) (115,763) (12,861) (155,946) (286,997) (107,207) (74,885) 0 0 0 0 (14,142) 0 (3,524) (2,130) (3,030) (6,530) (904) (212) 0 0 (30,405) (8,197) (37,903) (45,879) 0 0 19,894 (87) 5,111 240 596,775 237,751 110,948 (40,083) 55,078 27,134 20,931 (174) 5,666 189 629,261 241,650 129,316 (75,258) 36,052 5,466 -------------------- ------------------- ---------------------- ---------------------- -------------------------- 4,137 4,311 4,308 4,119 269,861 28,211 545,525 620,783 273,776 268,310 $ 25,068 $ 4,137 $ 9,974 $ 4,308 $ 899,122 $ 269,861 $ 674,841 $ 545,525 $ 309,828 $ 273,776 $ 382 $ 4 $ 303 $ 39 $ 3,210 $ 1,023 $ (789)$ 15,115 $ (9,899) $ (9,757)
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 53 Statements of Changes in Net Assets (Cont.)
Amounts in thousands Global Bond Fund II Emerging Markets Bond Fund Strategic Balanced Fund Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended Increase (Decrease) in Net Assets from: March 31, March 31, March 31, March 31, March 31, March 31, 2001 2000 2001 2000 2001 2000 Operations: Net investment income (loss) $ 4,454 $ 3,256 $ 4,541 $ 2,012 $ 5,108 $ 8,094 Net realized gain (loss) 2,471 (824) 2,700 1,254 1,743 (274) Net capital gain distributions received from underlying funds 0 0 0 0 1,770 0 Net change in unrealized appreciation (depreciation) 1,358 (803) (658) 2,001 (15,730) 4,531 Net increase (decrease) resulting from operations 8,283 1,629 6,583 5,267 (7,109) 12,351 -------------------------------------------- -------------------------- --------------------------- -------------------------- Distributions to Shareholders: From net investment income Institutional Class (3,875) (2,569) (3,335) (968) (2,935) (7,057) Administrative Class 0 0 (999) (914) (32) (25) Other Classes (570) (646) (211) (129) (1,267) (1,345) In excess of net investment income Institutional Class 0 (41) 0 0 0 0 Administrative Class 0 0 0 0 0 0 Other Classes 0 (11) 0 0 0 0 From net realized capital gains Institutional Class (379) 0 0 0 0 (1,427) Administrative Class 0 0 0 0 0 (7) Other Classes (68) 0 0 0 0 (347) In excess of net realized capital gains Institutional Class (1,552) (95) (1,807) 0 (2,872) (2,868) Administrative Class 0 0 (437) 0 (29) (13) Other Classes (280) (26) (108) 0 (1,549) (698) Total Distributions (6,724) (3,388) (6,897) (2,011) (8,684) (12,787) -------------------------------------------- -------------------------- --------------------------- -------------------------- Fund Share Transactions: Receipts for shares sold Institutional Class 6,935 59,618 34,602 16,701 3,779 8,040 Administrative Class 0 0 1,010 25,789 151 956 Other Classes 3,819 4,394 3,495 979 9,610 12,505 Issued in reorganization Institutional Class 0 0 0 0 0 35,908 Other Classes 0 0 0 0 0 30,872 Issued as reinvestment of distributions Institutional Class 5,308 2,526 4,821 888 5,725 7,091 Administrative Class 0 0 1,434 915 63 45 Other Classes 671 545 154 73 2,217 2,065 Cost of shares redeemed Institutional Class (35,563) (5,204) (5,860) (9,797) (76,927) (26,925) Administrative Class 0 0 (7,791) (15,204) (325) (293) Other Classes (3,685) (5,615) (1,800) (311) (8,994) (11,948) Net increase (decrease) resulting from Fund (22,515) 56,264 30,065 20,033 (64,701) 58,316 share transactions Total Increase (Decrease) in Net Assets (20,956) 54,505 29,751 23,289 (80,494) 56,880 -------------------------------------------- -------------------------- --------------------------- -------------------------- Net Assets: Beginning of period 97,049 42,544 27,847 4,558 154,998 98,118 End of period * $ 76,093 $ 97,049 $ 57,598 $ 27,847 $ 74,504 $ 154,998 *Including net undistributed (overdistributed) investment income of: $ (37) $ 889 $ 1,525 $ 862 $ 465 $ 1,795
54 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
European Convertible Short Duration Convertible Fund Fund StocksPLUS Fund Municipal Bond Fund Municipal Income Fund Period from Period from Year Ended Year Ended November 30, Year Ended Year Ended Year Ended Year Ended Year Ended August 31, March 31, March 31, 2000 to March 31, March 31, March 31, March 31, March 31, 1999 to 2001 2000 March 31, 2001 2001 2000 2001 2000 2001 March 31,2000 $ (122) $ 293 $ 21 $ (1,627) $ 98,837 $ 2,679 $ 2,314 $ 590 $ 244 (6,725) 7,821 93 (179,612) 38,756 1,298 (919) 41 (25) 0 0 0 0 0 0 0 0 0 (36,112) 27,966 (107) (108,609) 87,250 2,568 (2,965) 182 6 (42,959) 36,080 7 (289,848) 224,843 6,545 (1,570) 813 225 ------------------------ --------- ------------------------ ------------------------ -------------------------- (2,101) (276) (20) (11,561) (45,176) (707) (244) (573) (241) (6) 0 0 (641) (3,216) (193) (115) 0 0 (261) (17) 0 (11,931) (59,577) (1,776) (1,949) 0 0 0 (1,195) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (76) 0 0 0 0 0 0 0 0 (577) 0 0 (37,300) 0 0 0 0 0 0 0 0 (2,793) 0 0 0 0 0 (42) 0 0 (55,442) 0 0 0 0 (5,661) 0 0 (35,157) (19,356) 0 0 0 0 (20) 0 0 (2,729) (1,450) 0 0 0 0 (1,354) 0 0 (50,829) (28,771) 0 0 0 0 (9,403) (2,183) (20) (112,848) (253,081) (2,676) (2,308) (573) (241) 90,224 176,112 4,990 192,570 218,329 23,749 4,203 13,744 10,500 410 0 0 19,575 63,727 2,528 3,032 0 0 22,419 14,391 10 203,143 512,940 21,007 16,283 0 10 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 7,572 1,984 20 45,695 99,393 685 239 575 241 1 0 0 3,338 7,404 193 113 0 0 1,074 120 0 49,151 133,688 1,006 1,286 0 0 (155,586) (41,632) 0 (275,526) (201,504) (7,753) (4,329) (11,638) 0 0 0 0 (3,869) (52,930) (1,304) (1,268) 0 0 (6,093) (841) 0 (314,693) (455,756) (16,427) (21,656) 0 0 (39,979) 150,134 5,020 (80,616) 325,291 23,684 (2,097) 2,681 10,751 (92,341) 184,031 5,007 (483,312) 297,053 27,553 (5,975) 2,921 10,735 ------------------------ --------- ------------------------ ------------------------ -------------------------- 184,031 0 0 1,498,795 1,201,742 52,583 58,558 10,735 0 $ 91,690 $ 184,031 $ 5,007 $ 1,015,483 $1,498,795 $ 80,136 $ 52,583 $ 13,656 $ 10,735 $ (1,366) $ 5,512 $ 94 $ (26,538) $ 38,390 $ 17 $ 4 $ 31 $ 3
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 55 Statements of Changes in Net Assets (Cont.)
California California Intermediate Municipal Amounts in thousands Municipal Bond Fund Bond Fund New York Municipal Bond Fund Year Period Period Year Period Ended from from Ended from Increase (Decrease) in Net Assets from: March 31, August 31, May 16, March 31, August 31, 2001 1999 to 2000 to 2001 1999 to March 31, March 31, March 31, 2000 2001 2000 Operations: Net investment income $ 4,235 $ 106 $ 441 $ 146 $ 70 Net realized gain (loss) 1,278 (5) 544 132 (4) Net capital gain distributions received from 0 0 0 0 0 underlying funds Net change in unrealized appreciation (depreciation) 5,126 72 428 122 (8) Net increase resulting from operations 10,639 173 1,413 400 58 --------------------------------------------------- ---------------------- ---------- --------------------- Distributions to Shareholders: From net investment income Institutional Class (2,959) (97) (428) (143) (70) Administrative Class (62) 0 0 0 0 Other Classes (1,123) (8) (4) (2) 0 In excess of net investment income Institutional Class 0 0 0 0 0 Administrative Class 0 0 0 0 0 Other Classes 0 0 0 0 0 From net realized capital gains Institutional Class (206) 0 (390) (28) 0 Administrative Class (5) 0 0 0 0 Other Classes (100) 0 0 0 0 In excess of net realized capital gains Institutional Class 0 (6) 0 0 (6) Administrative Class 0 0 0 0 0 Other Classes 0 (1) 0 0 0 Total Distributions (4,455) (112) (822) (173) (76) --------------------------------------------------- ---------------------- ---------- --------------------- Fund Share Transactions: Receipts for shares sold Institutional Class 112,569 8,840 21,136 300 3,000 Administrative Class 1,550 10 0 0 0 Other Classes 42,117 1,889 819 285 20 Issued in reorganization Institutional Class 0 0 0 0 0 Other Classes 0 0 0 0 0 Issued as reinvestment of distributions Institutional Class 3,049 91 807 171 76 Administrative Class 66 0 0 0 0 Other Classes 1,124 12 4 2 0 Cost of shares redeemed Institutional Class (40,783) (556) (10,590) 0 0 Administrative Class (10) 0 0 0 0 Other Classes (17,630) (119) (110) (11) 0 Net increase resulting from Fund share transactions 102,052 10,167 12,066 747 3,096 Total Increase in Net Assets 108,236 10,228 12,657 974 3,078 --------------------------------------------------- ---------------------- ---------- --------------------- Net Assets: Beginning of period 10,228 0 0 3,078 0 End of period * $ 118,464 $ 10,228 $ 12,657 $ 4,052 $ 3,078 *Including net undistributed investment income of: $ 1,115 $ 1 $ 152 $ 66 $ 0
56 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Statements of Cash Flows
Long-Term Amounts in thousands Short-Term U.S. Gov't Real Return Foreign Global Global Bond Fund Fund Bond Fund Bond Fund Bond Fund Fund II Increase (Decrease) in Cash and Foreign Currency from: Financing Activities Sales of Fund shares $ 679,178 $ 368,274 $ 708,752 $ 268,133 $ 153,653 $ 10,735 Redemptions of Fund shares (803,817) (297,340) (158,587) (197,372) (105,810) (39,292) Cash distributions paid (13,952) (4,962) (5,636) (5,980) (4,944) (797) Increase (decrease) from financing transactions 437,482 (5,569) 588,733 167,403 124,664 38,686 Net increase from financing activities 298,891 60,403 1,133,262 232,184 167,563 9,332 Operating Activities Purchases of long-term securities and foreign currency (1,652,199) (6,942,341) (3,285,517) (4,245,078) (2,152,421) (570,151) Proceeds from sales of long-term securities and foreign currency 1,081,041 6,849,537 2,336,368 4,059,928 2,006,517 557,747 Purchases of short-term securities (net) 227,689 4,651 (178,550) (60,295) (4,746) 2,203 Net investment income 43,519 23,590 40,196 33,316 16,487 4,454 Change in other receivables/payables (net) 1,434 4,250 (44,116) 7,619 (21,513) (742) Net (decrease) from operating activities (298,516) (60,313) (1,131,619) (204,510) (155,676) (6,489) ----------------------------------------------- ------------- ------------ ------------- ------------ ------------ ---------- Net Increase in Cash and Foreign Currency 375 90 1,643 27,674 11,887 2,843 ----------------------------------------------- ------------- ------------ ------------- ------------ ------------ ---------- Cash and Foreign Currency Beginning of period 628 1 334 9,658 6,695 2,576 End of period $ 1,003 $ 91 $ 1,977 $ 37,332 $ 18,582 $ 5,419
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 57 Schedule of Investments Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 35.0% -------------------------------------------------------------------------------- Banking & Finance 22.1% AB Spintab 6.800% due 12/29/2049 $ 250 $ 253 Abbey National Capital Trust I 8.963% due 12/29/2049 31,600 35,041 Abbey National PLC 6.700% due 06/29/2049 5,000 4,839 Abbey National Treasury Service PLC 6.625% due 05/23/2001 240 241 ABN AMRO Mortgage Corp. 7.250% due 05/31/2005 150 158 Aetna, Inc. 6.750% due 08/15/2001 250 251 Air 2 US 8.027% due 10/01/2020 294 313 Allstate Corp. 7.875% due 05/01/2005 100 108 6.750% due 05/15/2018 280 271 6.900% due 05/15/2038 87,200 81,841 AMERCO 7.135% due 10/15/2002 15,000 14,746 7.230% due 01/21/2027 1,250 1,207 American Express Co. 8.500% due 08/15/2001 350 355 5.625% due 01/22/2004 14,700 14,848 7.450% due 08/10/2005 1,000 1,070 American General Finance 6.050% due 07/02/2001 3,000 3,010 6.875% due 12/14/2001 1,600 1,624 7.450% due 07/01/2002 200 206 6.250% due 12/18/2002 1,165 1,191 6.375% due 03/01/2003 350 358 6.170% due 05/06/2003 3,200 3,275 8.125% due 03/15/2046 270 276 American Health Properties, Inc. 7.050% due 01/15/2002 700 700 Aon Capital Trust A 8.205% due 01/01/2027 725 700 Aristar, Inc. 7.375% due 09/01/2004 20,000 20,825 Associates Corp. of North America 6.625% due 05/15/2001 1,300 1,302 6.700% due 05/29/2001 100 100 7.000% due 07/23/2001 500 504 5.400% due 08/27/2001 (d) 13,500 13,539 6.450% due 10/15/2001 23,600 23,801 7.500% due 04/15/2002 185 190 5.446% due 05/21/2002 (d) 6,850 6,857 6.375% due 07/15/2002 175 178 6.500% due 07/15/2002 750 766 6.000% due 12/01/2002 500 508 5.750% due 11/01/2003 5,425 5,477 5.800% due 04/20/2004 450 455 6.625% due 06/15/2005 100 103 AT&T Capital Corp. 6.250% due 05/15/2001 19,443 19,459 7.000% due 08/15/2001 11,100 11,163 7.110% due 09/13/2001 1,030 1,038 6.900% due 01/30/2002 1,000 1,010 6.750% due 02/04/2002 1,925 1,944 5.881% due 04/23/2002 (d) 74,000 74,177 Avalonbay Communities 7.375% due 09/15/2002 2,565 2,629 AVCO Financial Services, Inc. 7.375% due 08/15/2001 300 303 Banco Latinoamericano SA 6.500% due 04/02/2001 950 950 7.173% due 06/04/2001 5,000 5,000 7.878% due 11/30/2001 9,500 9,500 Banco Nacional de Comercio Exterior 7.250% due 02/02/2004 25,050 25,238 Banesto Delaware, Inc. 8.250% due 07/28/2002 43,900 45,508 Bank of America Corp. 9.500% due 04/01/2001 235 235 7.000% due 09/15/2001 1,500 1,513 6.538% due 09/26/2001 (d) 33,000 33,000 6.752% due 02/20/2002 (d) 35,180 35,205 8.125% due 06/15/2002 350 363 6.810% due 06/17/2002 (d) 10,000 10,005 7.750% due 07/15/2002 510 527 7.750% due 08/01/2002 896 898 7.200% due 09/15/2002 1,000 1,030 7.500% due 10/15/2002 1,200 1,244 6.850% due 03/01/2003 65 67 6.875% due 06/01/2003 100 103 6.500% due 08/15/2003 150 154 6.125% due 07/15/2004 600 608 6.750% due 09/15/2005 200 206 8.570% due 11/15/2024 125 141 Bank One Corp. 6.820% due 04/19/2001 (d) 2,000 2,001 6.733% due 09/04/2001 (d) 14,000 14,006 6.348% due 06/26/2002 (d) 5,000 5,002 6.895% due 09/26/2003 (d) 18,400 18,411 BankBoston Corp. 6.125% due 03/15/2002 12,500 12,626 Banponce Financial Corp. 6.463% due 11/13/2001 13,000 13,117 Barclays Bank PLC 8.550% due 09/29/2049 25,000 27,678 Bayerische Landesbank NY 6.200% due 02/09/2006 250 252 Bear Stearns Co., Inc. 9.375% due 06/01/2001 125 126 7.083% due 04/05/2002 (d) 25,000 24,879 5.640% due 05/07/2002 (d) 4,300 4,303 7.134% due 08/01/2002 (d) 71,500 71,556 5.370% due 12/16/2002 (d) 48,900 48,984 6.125% due 02/01/2003 25 25 5.210% due 03/28/2003 (d) 81,500 81,476 6.750% due 04/15/2003 105 107 5.718% due 05/06/2003 (d) 25,000 24,796 7.013% due 05/16/2003 (d) 40,700 40,372 5.820% due 07/22/2003 (d) 19,000 18,795 6.700% due 08/01/2003 100 102 6.625% due 01/15/2004 200 204 6.150% due 03/02/2004 200 201 8.750% due 03/15/2004 75 81 7.156% due 06/01/2004 (d) 12,665 12,518 5.270% due 09/21/2004 (d) 5,200 5,202 7.036% due 03/18/2005 (d) 37,000 37,134 6.848% due 09/16/2005 (d) 16,000 15,763 Beaver Valley Funding Corp. 8.250% due 06/01/2003 405 416 Beneficial Corp. 6.610% due 09/13/2001 140 141 5.409% due 01/09/2002 (d) 500 501 6.870% due 03/01/2002 (d) 50,000 50,109 8.000% due 06/18/2002 400 412 6.030% due 01/14/2003 320 323 Bombardier Capital Trust I 7.210% due 06/09/2032 (d) 16,150 15,914 Bombardier Capital Trust II 7.210% due 06/09/2032 (d) 3,600 3,547 Bombardier Capital, Inc. 7.300% due 12/15/2002 9,000 9,194 Caithness Coso Fund Corp. 6.800% due 12/15/2001 5,659 5,644 Chase Manhattan Bank 6.125% due 11/01/2008 400 391 Chase Manhattan Corp. 8.500% due 02/15/2002 200 206 5.750% due 04/15/2004 150 152 6.000% due 11/01/2005 50 50 58 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Chrysler Financial Corp. LLC 5.606% due 06/11/2001 (d) $ 46,700 $ 46,686 5.690% due 11/15/2001 650 652 5.400% due 01/15/2002 15,750 15,671 6.950% due 03/25/2002 50 51 5.701% due 07/17/2002 (d) 20,000 19,823 5.120% due 08/08/2002 (d) 66,100 65,524 5.756% due 02/03/2003 (d) 50,000 49,367 5.150% due 02/10/2003 (d) 7,100 7,008 6.789% due 03/06/2003 (d) 25,000 24,512 5.736% due 03/10/2003 (d) 65,000 63,688 6.739% due 06/18/2003 35,000 34,424 Chubb Capital Corp. 6.875% due 02/01/2003 100 103 Cincinnati Financial Corp. 6.900% due 05/15/2028 111,870 100,124 CIT Group, Inc. 5.800% due 03/26/2002 1,000 1,007 5.190% due 09/13/2002 (d) 30,900 30,810 7.375% due 03/15/2003 500 517 5.625% due 10/15/2003 250 250 Citicorp 8.000% due 02/01/2003 250 262 CitiFinancial Credit Co. 8.250% due 11/01/2001 2,500 2,548 6.875% due 05/01/2002 335 342 6.375% due 09/15/2002 115 117 7.750% due 03/01/2005 550 588 Citigroup, Inc. 5.800% due 03/15/2004 200 203 CNA Financial Corp. 6.250% due 11/15/2003 65 64 Comerica Bank 7.250% due 06/15/2007 200 211 Countrywide Home Loans 6.250% due 04/15/2009 600 585 Credit Asset Receivable 6.274% due 10/31/2003 34,030 34,156 DBS Group Holdings Ltd. 7.875% due 08/10/2009 6,000 6,445 Deutsche Telekom International Finance 7.750% due 06/15/2005 97,100 100,329 Donaldson, Lufkin & Jenrette, Inc. 6.910% due 09/18/2002 (d) 13,600 13,609 6.023% due 04/25/2003 (d) 400 400 6.170% due 07/15/2003 20,000 20,423 Dow Capital BV 7.125% due 01/15/2003 100 103 Duke Capital Corp. 7.250% due 10/01/2004 19,000 19,921 Export-Import Bank Korea 7.250% due 06/25/2001 2,600 2,606 7.125% due 09/20/2001 12,370 12,404 6.500% due 02/10/2002 26,141 26,159 6.500% due 11/15/2006 6,445 6,567 7.100% due 03/15/2007 17,600 18,297 Exxon Capital Corp. 6.125% due 09/08/2008 2,000 2,029 Farmers Insurance 8.625% due 05/01/2024 275 280 Finova Capital Corp. 5.875% due 10/15/2001 (e) 1,000 831 6.040% due 11/08/2002 (d)(e) 51,350 42,159 6.316% due 04/08/2003 (d)(e) 300 246 5.193% due 06/18/2003 (d)(e) 32,300 26,486 6.330% due 11/24/2003 1,300 1,083 First Chicago Corp. 9.250% due 11/15/2001 250 256 6.740% due 03/11/2002 (d) 20,000 20,039 6.884% due 07/28/2003 (d) 50 50 First National Bank Chicago 8.080% due 01/05/2018 250 270 First Security Corp. 5.875% due 11/01/2003 9,325 9,421 First Union Corp. 8.125% due 06/24/2002 150 155 FleetBoston Financial Corp. 9.900% due 06/15/2001 200 202 Ford Credit Canada 6.820% due 12/16/2002 (d) 56,000 55,943 Ford Motor Credit Co. 7.020% due 06/07/2001 1,000 1,003 5.030% due 07/13/2001 (d) 47,700 47,690 6.813% due 09/03/2001 (d) 27,000 27,024 7.000% due 09/25/2001 1,125 1,136 6.918% due 10/15/2001 (d) 13,000 13,005 6.838% due 11/16/2001 (d) 82,800 82,869 8.240% due 01/15/2002 85 87 5.804% due 01/17/2002 (d) 53,945 53,901 8.200% due 02/15/2002 500 513 6.500% due 02/28/2002 1,710 1,732 6.093% due 03/19/2002 (d) 28,458 28,399 6.873% due 04/29/2002 (d) 33,000 33,007 6.961% due 05/21/2002 (d) 7,000 7,005 6.878% due 05/23/2002 (d) 14,000 14,018 6.823% due 06/04/2002 (d) 12,000 12,000 8.000% due 06/15/2002 150 155 5.939% due 07/16/2002 (d) 172,555 172,496 6.911% due 08/01/2002 (d) 36,000 35,989 6.550% due 09/10/2002 4,000 4,064 5.829% due 10/15/2002 (d) 35,050 35,012 7.750% due 11/15/2002 5,730 5,931 6.000% due 01/14/2003 1,100 1,109 7.500% due 01/15/2003 250 258 6.900% due 02/03/2003 (d) 40,000 39,883 5.535% due 02/13/2003 (d) 284,185 282,374 5.133% due 03/17/2003 (d) 37,000 36,723 6.125% due 04/28/2003 26,130 26,409 5.323% due 06/02/2003 (d) 38,100 38,050 6.826% due 06/20/2003 (d) 16,900 16,885 6.625% due 06/30/2003 775 791 5.605% due 11/24/2003 (d) 47,000 46,916 5.750% due 02/23/2004 1,216 1,215 6.125% due 03/20/2004 400 404 5.860% due 04/26/2004 (d) 63,000 62,473 6.951% due 05/21/2004 (d) 32,200 31,883 6.873% due 06/02/2004 (d) 1,500 1,485 7.500% due 06/15/2004 100 105 6.700% due 07/16/2004 92,905 95,111 6.089% due 07/19/2004 (d) 174,500 173,338 8.250% due 02/23/2005 2,500 2,681 7.500% due 03/15/2005 17,000 17,801 6.946% due 04/28/2005 (d) 58,000 56,929 5.353% due 06/30/2005 (d) 65,000 64,244 6.179% due 07/18/2005 (d) 214,000 210,617 7.600% due 08/01/2005 5,000 5,268 6.375% due 12/15/2005 100 101 5.400% due 08/27/2006 (d) 27,500 27,500 7.200% due 06/15/2007 25 26 5.800% due 01/12/2009 155 146 Fuji Bank Ltd. 9.870% due 12/31/2049 (d) 25,475 21,123 General Electric Capital Corp. 6.020% due 05/04/2001 1,000 1,001 5.500% due 11/01/2001 50 50 5.650% due 03/31/2003 125 127 6.210% due 12/09/2005 400 413 7.875% due 12/01/2006 30 33 General Motors Acceptance Corp. 7.125% due 05/01/2001 44,395 44,464 6.750% due 06/05/2001 880 883 6.875% due 07/15/2001 1,000 1,006 6.375% due 12/01/2001 765 772 5.500% due 12/15/2001 100 100 9.625% due 12/15/2001 5,650 5,826 6.625% due 01/10/2002 500 506 6.750% due 02/07/2002 1,590 1,612 7.750% due 03/25/2002 125 129 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 59 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 6.250% due 08/15/2002 $ 100 $ 101 7.000% due 09/15/2002 250 255 6.625% due 10/01/2002 5,000 5,089 7.103% due 10/07/2002 (d) 18,100 18,124 5.509% due 11/12/2002 (d) 10,200 10,210 5.609% due 11/12/2002 (d) 28,995 28,917 6.860% due 12/09/2002 (d) 64,050 64,157 6.750% due 12/10/2002 500 511 6.200% due 12/15/2002 500 506 5.480% due 12/16/2002 150 150 6.000% due 01/15/2003 990 1,002 5.875% due 01/22/2003 100,500 101,153 5.548% due 02/14/2003 (d) 10,000 9,962 5.210% due 03/10/2003 (d) 7,000 6,970 6.750% due 03/15/2003 49,725 50,906 7.125% due 05/01/2003 36,000 37,054 6.394% due 07/20/2003 (d) 13,042 13,030 5.924% due 07/21/2003 (d) 13,700 13,720 5.510% due 08/18/2003 (d) 128,090 127,973 5.550% due 09/15/2003 32,000 31,954 6.625% due 10/20/2003 2,000 2,046 5.750% due 11/10/2003 1,100 1,102 6.396% due 01/20/2004 (d) 273,857 273,826 5.750% due 03/22/2004 (d) 123,300 123,300 6.536% due 04/05/2004 (d) 43,500 42,879 6.930% due 05/28/2004 (d) 73,000 71,588 6.850% due 06/17/2004 1,200 1,234 5.999% due 07/21/2004 (d) 62,800 62,233 7.291% due 09/20/2004 (d) 19,951 19,933 6.650% due 11/17/2005 500 509 6.150% due 04/05/2007 150 146 8.950% due 07/02/2009 17,333 18,580 Gold Eagle Capital Ltd. 11.079% due 04/15/2001 (d) 46,300 46,300 Golden State Holdings 6.750% due 08/01/2001 (d) 1,950 1,946 7.759% due 08/01/2003 (d) 500 485 Goldman Sachs Group, Inc. 5.971% due 01/17/2003 (d) 72,000 72,124 6.625% due 12/01/2004 275 281 7.625% due 08/17/2005 23,000 24,515 7.458% due 02/09/2009 (d) 10,000 10,084 6.500% due 02/25/2009 140 139 Great Western Finance Trust II 8.206% due 02/01/2027 150 145 Halyard RE 10.555% due 04/05/2002 (d) 1,800 1,800 Hansol Paper Co. Ltd. 8.943% due 05/24/2001 (d) 20,000 20,200 Hartford Life, Inc. 6.900% due 06/15/2004 600 622 Heller Financial, Inc. 6.803% due 06/07/2001 (d) 4,000 4,002 5.116% due 06/25/2001 (d) 101,250 101,288 5.750% due 09/25/2001 1,400 1,405 5.979% due 10/22/2001 (d) 19,200 19,215 6.500% due 11/01/2001 250 252 7.658% due 11/09/2001 (d) 4,400 4,421 5.889% due 04/22/2002 (d) 2,100 2,100 6.940% due 04/26/2002 (d) 12,000 11,992 6.850% due 05/07/2002 (d) 25,400 25,386 6.930% due 05/13/2002 (d) 10,000 9,992 7.000% due 05/15/2002 900 915 6.500% due 07/22/2002 140 142 5.979% due 07/24/2002 (d) 16,200 16,233 5.858% due 04/28/2003 (d) 53,500 53,350 6.989% due 04/28/2003 (d) 26,000 25,960 Hertz Corp. 7.000% due 07/15/2003 13,300 13,684 Hitachi Credit America 5.939% due 10/15/2003 (d) 11,500 11,501 Household Bank 6.961% due 04/03/2001 (d) 16,000 16,000 6.820% due 09/26/2001 (d) 9,000 9,007 6.949% due 10/22/2003 (d) 15,000 14,956 Household Capital Trust III 7.010% due 06/26/2004 (d) 23,925 22,133 Household Finance Corp. 6.490% due 04/09/2001 9,920 9,922 6.780% due 06/22/2001 (d) 3,000 3,000 6.909% due 08/01/2001 (d) 1,500 1,501 6.909% due 11/01/2001 (d) 4,500 4,504 6.876% due 05/07/2002 (d) 43,450 43,252 6.951% due 05/24/2002 (d) 113,800 113,938 7.080% due 06/03/2002 15,000 15,345 5.875% due 11/01/2002 200 202 6.125% due 02/27/2003 500 504 5.116% due 06/24/2003 (d) 31,000 30,897 Household Netherlands BV 6.125% due 03/01/2003 18,100 18,275 HSBC Capital Funding LP 10.176% due 12/29/2049 20,000 20,735 9.547% due 12/31/2049 76,400 88,226 10.176% due 12/31/2049 26,160 32,221 Industrial Bank of Korea 7.100% due 10/15/2001 3,290 3,313 Inter-American Development Bank 5.375% due 01/18/2006 181,000 181,970 8.875% due 06/01/2009 200 242 7.375% due 01/15/2010 4,200 4,678 International Bank for Reconstruction & Development 7.000% due 01/27/2005 1,000 1,065 International Lease Finance Corp. 5.930% due 07/15/2003 14,000 14,172 J.P. Morgan & Co., Inc. 6.700% due 11/01/2007 30 31 6.655% due 02/15/2012 (d) 600 548 JET Equipment Trust 10.000% due 06/15/2012 80 92 10.690% due 05/01/2015 100 122 John Hancock 7.375% due 02/15/2024 360 351 KBC Bank Fund Trust III 9.860% due 11/29/2049 (d) 5,700 6,394 Key Bank USA NA 7.550% due 09/15/2006 350 370 Kimco Realty Corp. 6.500% due 10/01/2003 200 203 Korea Development Bank 7.125% due 09/17/2001 13,055 13,141 7.900% due 02/01/2002 300 304 8.600% due 03/25/2002 6,600 6,786 6.500% due 11/15/2002 440 444 6.750% due 12/01/2005 55 55 7.250% due 05/15/2006 50 51 LB Rheinland - PFALZ 5.000% due 02/23/2028 3,400 3,383 Lehman Brothers Holdings, Inc. 7.019% due 03/18/2002 (d) 10,000 10,000 6.375% due 05/07/2002 61,290 62,098 8.750% due 05/15/2002 219 227 6.186% due 07/08/2002 (d) 60,100 60,139 6.479% due 07/15/2002 (d) 43,651 43,945 7.125% due 07/15/2002 100 102 7.080% due 08/12/2002 (d) 6,500 6,489 7.450% due 08/28/2002 (d) 6,500 6,509 5.389% due 09/03/2002 (d) 14,000 14,003 5.610% due 12/12/2002 (d) 60,100 60,344 5.240% due 04/04/2003 (d) 132,550 132,747 7.625% due 06/01/2006 350 370 LG&E Capital Corp. 7.360% due 06/18/2001 (d) 400 400 6.205% due 05/01/2004 1,000 966 6.460% due 01/15/2008 3,000 2,714 Liberty Mutual Insurance 8.200% due 05/04/2007 17,510 18,272 Limestone Electron Trust 8.625% due 03/15/2003 71,350 74,521 60 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Lion Connecticut Holdings 6.375% due 08/15/2003 $ 200 $ 204 7.250% due 08/15/2023 50 48 Lloyds TSB Bank 5.745% due 08/26/2010 (d) 3,000 2,999 MBNA America Bank NA 7.010% due 04/25/2002 (d) 1,000 999 MBNA Corp. 5.610% due 08/07/2001 (d) 100 100 6.980% due 09/13/2001 (d) 10,300 10,310 MCN Investment Corp. 7.120% due 01/16/2004 7,500 7,614 6.300% due 04/02/2011 7,500 7,500 Merrill Lynch & Co. 6.500% due 04/01/2001 400 400 6.750% due 04/30/2001 2,775 2,778 8.000% due 02/01/2002 400 410 7.375% due 08/17/2002 300 310 8.300% due 11/01/2002 700 734 6.000% due 02/12/2003 500 509 6.875% due 03/01/2003 140 145 5.006% due 06/24/2003 (d) 27,000 26,992 6.550% due 08/01/2004 400 414 7.000% due 04/27/2008 100 104 Metropolitan Life Insurance Co. 6.300% due 11/01/2003 6,800 6,910 MIC Financing Trust I 8.375% due 02/01/2027 36,000 32,484 Monumental Global Funding II 6.910% due 09/26/2003 (d) 58,500 58,519 Morgan Stanley Group, Inc. 6.700% due 05/01/2001 600 601 9.375% due 06/15/2001 300 303 5.228% due 03/11/2003 (d) 11,500 11,500 6.375% due 12/15/2003 150 154 5.625% due 01/20/2004 1,200 1,206 Morgan Stanley, Dean Witter & Co. 6.948% due 04/15/2002 (d) 550 551 5.590% due 05/05/2003 (d) 43,000 43,088 6.964% due 08/07/2003 (d) 140,800 140,974 5.899% due 04/22/2004 (d) 108,500 108,622 Nacional Financiera 9.750% due 03/12/2002 10,000 10,365 7.284% due 05/08/2003 (d) 7,750 8,021 National Rural Utilities Cooperative Finance Corp. 6.880% due 05/31/2002 (d) 10,000 10,010 5.721% due 08/13/2002 (d) 12,000 12,003 6.250% due 04/15/2003 50,000 50,728 National Westminster Bank PLC 5.520% due 09/16/2002 (d) 12,275 12,317 9.375% due 11/15/2003 200 220 Newcourt Credit Group, Inc. 6.875% due 02/16/2005 7,500 7,712 Noble Affiliates, Inc. 8.950% due 12/15/2004 11,500 11,990 Nordbanken AB 7.250% due 11/12/2009 25,250 26,224 8.950% due 11/19/2049 4,000 4,389 Nordstrom Credit, Inc. 7.250% due 04/30/2002 1,000 1,026 Northern Rock PLC 2.000% due 01/01/2000 660 14,685 Okobank 7.040% due 05/23/2006 (d) 10,000 10,081 Old Kent Bank 6.275% due 11/01/2005 (d) 1,300 1,299 7.750% due 08/15/2010 19,500 20,517 Orix Credit Alliance, Inc. 6.785% due 04/16/2001 15,000 15,007 7.640% due 09/17/2001 13,000 13,163 Osprey Trust 8.310% due 01/15/2003 75,475 77,834 Pacific Life Insurance Co. 7.900% due 12/30/2023 8,000 8,097 Paine Webber Group, Inc. 7.030% due 05/20/2002 (d) 1,000 1,000 7.290% due 07/15/2002 (d) 200 201 Parker Retirement Savings Plan 6.340% due 07/15/2008 791 791 PDVSA Finance Ltd. 7.400% due 08/15/2016 1,200 966 Pemex Finance Ltd. 6.125% due 11/15/2003 17,111 17,007 PNC Bank NA 5.150% due 01/24/2002 (d) 49,000 49,030 PNC Funding Corp. 6.875% due 03/01/2003 100 103 7.000% due 09/01/2004 20,000 20,771 PNC Institutional Capital Trust A 7.950% due 12/15/2026 150 146 Popular North American, Inc. 6.875% due 06/15/2001 16,500 16,559 7.375% due 09/15/2001 25,000 25,263 Popular, Inc. 6.200% due 04/30/2001 3,336 3,338 6.540% due 11/06/2001 18,705 18,877 6.625% due 01/15/2004 19,500 19,804 Premium Asset Trust 7.076% due 11/27/2004 (d) 48,900 49,009 Prime Property Funding II 7.000% due 08/15/2004 110 112 Protective Life Funding Trust 6.089% due 01/17/2003 (d) 2,000 2,003 Prudential Funding Corp. 6.375% due 07/23/2006 100 101 6.625% due 04/01/2009 17,000 16,110 PSEG Capital Corp. 6.740% due 10/23/2001 1,400 1,414 Qwest Capital Funding, Inc. 6.875% due 08/15/2001 73,750 74,190 7.253% due 07/08/2002 (d) 18,000 18,024 Reliance Group Holdings, Inc. 9.000% due 11/15/2000 (e) 19,000 1,663 9.750% due 11/15/2003 (e) 10,000 288 Reliant Energy Financial Co. 7.660% due 12/10/2001 (d) 53,100 53,120 Rothmans Holdings 6.500% due 05/06/2003 16,390 16,561 Royal Bank of Scotland Group PLC 6.770% due 03/31/2049 126,500 115,896 8.817% due 03/31/2049 41,600 45,064 9.118% due 03/31/2049 66,400 75,622 Salomon, Inc. 6.650% due 07/15/2001 600 603 7.000% due 03/04/2002 18,850 19,236 6.750% due 02/15/2003 450 462 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (i) 30,140 30,306 6.625% due 07/01/2002 55 56 6.125% due 01/15/2003 290 294 5.629% due 02/11/2003 (d) 44,200 44,264 5.848% due 04/28/2003 (d) 28,000 28,027 7.000% due 03/15/2004 100 104 Sears Roebuck Acceptance Corp. 6.800% due 05/07/2001 500 501 6.790% due 05/21/2001 500 501 7.190% due 06/18/2001 5,880 5,908 7.110% due 06/19/2001 1,000 1,005 6.860% due 07/03/2001 3,409 3,426 9.400% due 08/02/2001 250 253 6.860% due 08/06/2001 400 403 6.710% due 08/13/2001 80 80 6.600% due 10/09/2001 17,000 17,162 6.360% due 12/04/2001 290 293 6.120% due 12/13/2001 260 262 6.950% due 05/15/2002 300 305 6.000% due 03/20/2003 149,750 150,403 7.260% due 04/21/2003 3,000 3,104 7.140% due 05/02/2003 5,000 5,164 6.560% due 11/20/2003 1,178 1,204 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 61 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Seismic Ltd. 10.901% due 01/01/2002 (d) $ 32,500 $ 32,305 Simon Property Group, Inc. 9.000% due 03/15/2002 2,000 2,054 Socgen Real Estate LLC 7.640% due 12/29/2049 20,000 20,120 Spieker Properties, Inc. 6.800% due 12/15/2001 5,500 5,552 6.950% due 12/15/2002 1,600 1,632 6.800% due 05/01/2004 1,000 1,020 Steers 10.501% due 08/07/2002 (d) 20,000 20,388 Sumitomo Bank Treasury Co. 9.400% due 12/29/2049 (d) 6,750 6,510 Sun Life of Canada (U.S.) 8.526% due 05/29/2049 250 235 Telewest Credit Links 8.500% due 04/16/2004 25,000 21,459 Textron Financial Corp. 5.860% due 10/26/2001 (d) 11,200 11,219 7.099% due 05/28/2002 (d) 51,900 51,836 7.034% due 09/17/2002 (d) 2,000 2,004 The Money Store, Inc. 8.050% due 04/15/2002 300 309 7.300% due 12/01/2002 100 103 Tokai Capital Corp. 9.980% due 12/29/2049 (d) 9,735 8,120 Toyota Motor Credit Corp. 7.325% due 02/15/2002 (d) 40,000 40,068 Transamerica Finance Corp. 6.798% due 09/17/2001 (d) 12,000 12,000 6.125% due 11/01/2001 29,000 29,187 6.830% due 12/14/2001 (d) 64,300 64,320 5.920% due 03/29/2002 52,050 52,572 7.250% due 08/15/2002 86,195 88,243 7.500% due 03/15/2004 270 283 U.S. Bancorp 6.750% due 01/16/2002 (d) 49,000 49,024 5.755% due 02/03/2003 (d) 18,100 18,166 6.924% due 03/06/2003 600 602 6.500% due 06/15/2004 600 616 UBS Preferred Funding Trust I 8.622% due 10/29/2049 38,900 43,083 Wachovia Corp. 6.375% due 04/15/2003 200 204 6.075% due 05/02/2005 (d) 78,100 78,007 Washington Mutual Capital I 8.375% due 06/01/2027 235 225 Wells Fargo & Co. 8.750% due 05/01/2002 100 104 6.500% due 09/03/2002 100 102 6.625% due 07/15/2004 6,500 6,740 6.025% due 05/02/2005 (d) 77,300 77,235 Wells Fargo Financial, Inc. 6.375% due 07/16/2002 500 509 6.250% due 11/01/2002 100 102 7.000% due 01/15/2003 380 393 6.000% due 02/01/2004 50 51 10.875% due 04/15/2001 200 200 Westdeutsche Landesbank 6.750% due 06/15/2005 36,400 37,341 6.050% due 01/15/2009 164,600 162,284 ------------- 9,355,068 ------------- Industrials 7.0% AIC Corp. 6.965% due 10/02/2002 (d) 10,000 9,983 Air Products & Chemicals, Inc. 6.250% due 06/15/2003 2,500 2,533 Akzo Nobel, Inc. 6.000% due 11/15/2003 32,000 32,319 Allied Waste North America, Inc. 7.375% due 01/01/2004 18,925 18,641 Alpha Wind 11.321% due 05/23/2001 (d) 17,200 17,200 America West Airlines, Inc. 6.870% due 07/02/2018 1,820 1,739 American Airlines, Inc. 10.210% due 01/01/2010 6,500 7,188 10.610% due 03/04/2011 1,895 2,160 Amoco Corp. 6.250% due 10/15/2004 1,000 1,035 AMR Corp. 9.400% due 05/08/2001 3,000 3,005 9.430% due 05/10/2001 1,000 1,002 9.500% due 05/15/2001 6,480 6,495 9.130% due 10/25/2001 2,000 2,042 8.470% due 02/20/2002 2,000 2,036 8.500% due 02/26/2002 1,000 1,018 Anheuser-Busch Companies, Inc. 6.750% due 08/01/2003 500 524 Atlas Air, Inc. 9.504% due 10/04/2004 (d) 22,700 22,700 10.504% due 10/04/2004 (d) 3,000 3,000 Baxter International, Inc. 9.500% due 06/15/2008 200 237 Bayer Corp. 6.500% due 10/01/2002 250 255 Boeing Co. 6.350% due 06/15/2003 750 777 Boise Cascade Corp. 7.150% due 05/15/2001 10,000 10,005 Browning-Ferris Industries, Inc. 6.100% due 01/15/2003 (d) 6,000 5,844 Campbell Soup Co. 4.750% due 10/01/2003 700 690 Cargill, Inc. 6.871% due 01/14/2002 (d) 11,700 11,704 Cemex SA de CV 9.250% due 06/17/2002 5,000 5,144 8.625% due 07/18/2003 48,250 49,698 Champion International Corp. 9.700% due 05/01/2001 4,000 4,013 Clear Channel Communications, Inc. 7.210% due 06/15/2002 (d) 20,000 20,056 Coastal Corp. 5.554% due 03/06/2002 (d) 146,350 146,350 8.125% due 09/15/2002 250 258 Coca-Cola Enterprises, Inc. 6.375% due 08/01/2001 500 502 7.875% due 02/01/2002 100 103 6.000% due 07/15/2003 250 255 5.750% due 11/01/2008 100 99 Colgate-Palmolive Co. 6.000% due 08/15/2003 45 46 Comcast Cable Communications 8.375% due 05/01/2007 145 159 Continental Airlines, Inc. 6.410% due 04/15/2007 337 343 6.800% due 07/02/2007 25 25 6.954% due 02/02/2011 22,768 23,011 6.900% due 01/02/2018 1,468 1,499 Cox Communications, Inc. 7.000% due 08/15/2001 1,500 1,506 6.500% due 11/15/2002 200 202 Cox Enterprises, Inc. 6.625% due 06/14/2002 7,250 7,334 6.425% due 05/01/2033 (d) 500 500 CSX Corp. 7.260% due 06/24/2002 (d) 30,700 30,721 DaimlerChrysler North America Holding Corp. 6.630% due 09/21/2001 1,000 1,008 6.899% due 01/18/2002 (d) 41,000 40,802 7.125% due 03/01/2002 16,500 16,604 5.640% due 08/23/2002 (d) 15,400 15,272 5.790% due 12/16/2002 (d) 93,100 92,715 7.750% due 05/27/2003 45,000 46,563 5.720% due 08/16/2004 (d) 76,600 74,666 7.250% due 01/18/2006 40,000 41,055 62 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Delta Air Lines Equipment Trust 9.230% due 07/02/2002 (l) $ 1,956 $ 2,034 10.500% due 01/02/2007 (l) 7,372 8,536 10.570% due 01/02/2007 (l) 15,881 18,571 10.370% due 01/02/2007 (l) 9,629 10,978 9.550% due 01/02/2008 (l) 7,773 8,845 10.430% due 01/02/2011 1,810 1,949 10.140% due 08/14/2012 1,000 1,102 10.000% due 06/05/2013 10,828 11,446 Delta Air Lines, Inc. 6.650% due 03/15/2004 13,500 13,208 7.379% due 05/18/2010 8,200 8,704 9.200% due 09/23/2014 6,000 6,031 10.500% due 04/30/2016 6,050 6,935 Duty Free International, Inc. 7.000% due 01/15/2004 175 177 Eastman Chemical Co. 6.375% due 01/15/2004 5,750 5,608 Electric Lightwave, Inc. 6.050% due 05/15/2004 10,700 9,779 Eli Lilly & Co. 8.125% due 12/01/2001 500 511 6.250% due 03/15/2003 100 102 Enron Corp. 5.510% due 09/10/2001 (d) 35,000 35,029 6.450% due 11/15/2001 5,275 5,311 8.375% due 05/23/2005 12,000 13,010 Federal Express Corp. 6.845% due 01/15/2019 811 809 Ford Capital BV 9.375% due 05/15/2001 300 301 9.500% due 06/01/2010 200 229 Ford Motor Co. 9.000% due 09/15/2001 980 996 6.625% due 10/01/2028 115,800 102,927 7.450% due 07/16/2031 10,000 9,855 7.400% due 11/01/2046 2,380 2,234 Fortune Brands, Inc. 8.500% due 10/01/2003 500 535 Fred Meyer, Inc. 7.150% due 03/01/2003 13,000 13,480 7.375% due 03/01/2005 38,100 39,911 General Foods Corp. 6.000% due 06/15/2001 200 200 General Motors Corp. 9.125% due 07/15/2001 100 101 6.250% due 05/01/2005 300 303 Gillette Co. 6.250% due 08/15/2003 750 773 5.750% due 10/15/2005 1,500 1,520 Grupo Elektra SA 12.750% due 05/15/2001 1,000 1,005 Harrahs Operating Co., Inc. 7.875% due 12/15/2005 5,000 5,025 HCA - The Healthcare Co. 8.020% due 08/05/2002 9,000 9,201 8.049% due 09/19/2002 (d) 60,500 60,497 8.130% due 08/04/2003 7,300 7,568 6.910% due 06/15/2005 9,500 9,352 6.630% due 07/15/2045 10,000 10,101 6.730% due 07/15/2045 22,560 22,797 Heinz (H.J.) Co. 6.875% due 01/15/2003 100 103 Hilton Hotels Corp. 7.375% due 06/01/2002 1,000 1,009 HNA Holdings, Inc. 6.125% due 02/01/2004 200 207 Houghton Mifflin Co. 5.990% due 12/03/2001 3,000 3,012 IBM Corp. 7.250% due 11/01/2002 625 645 ICI Wilmington, Inc. 6.750% due 09/15/2002 10,000 10,119 IMEXSA Export Trust 10.125% due 05/31/2003 7,091 6,907 Imperial Tobacco Overseas BV 7.125% due 04/01/2009 21,785 21,378 International Game Technology 7.875% due 05/15/2004 14,500 14,718 International Paper Co. 7.000% due 06/01/2001 2,000 2,005 6.666% due 07/08/2002 (d) 48,600 48,657 Kroger Co. 6.340% due 06/01/2001 50,924 50,984 Lockheed Martin Corp. 6.850% due 05/15/2001 89,064 89,188 Mandalay Resort Group 6.750% due 07/15/2003 4,500 4,354 Martin Marietta Corp. 6.500% due 04/15/2003 50 51 Mazda Manufacturing Corp. 10.500% due 07/01/2008 (l) 1,980 2,510 Nabisco, Inc. 6.800% due 09/01/2001 3,000 3,006 6.700% due 06/15/2002 9,000 9,045 6.125% due 02/01/2033 15,000 15,079 News America Holdings, Inc. 8.625% due 02/01/2003 750 786 Norfolk Southern Corp. 6.950% due 05/01/2002 12,000 12,196 7.875% due 02/15/2004 50 53 Northwest Airlines, Inc. 8.970% due 01/02/2015 1,576 1,684 8.072% due 10/01/2019 400 437 Occidental Petroleum Corp. 6.400% due 04/01/2003 17,710 17,834 Park Place Entertainment Corp. 7.950% due 08/01/2003 18,500 19,009 Petroleos Mexicanos 7.769% due 07/15/2005 (d) 32,250 32,331 7.845% due 07/15/2005 (d) 94,000 94,235 8.850% due 09/15/2007 1,800 1,852 9.375% due 12/02/2008 39,650 41,335 9.500% due 09/15/2027 31,000 32,473 Philip Morris Cos., Inc. 8.750% due 06/01/2001 7,735 7,775 6.000% due 07/15/2001 1,000 999 7.250% due 09/15/2001 3,770 3,797 7.500% due 01/15/2002 50 51 7.625% due 05/15/2002 8,300 8,475 6.800% due 12/01/2003 48,345 49,880 7.000% due 07/15/2005 15,125 15,646 6.950% due 06/01/2006 9,540 9,552 7.200% due 02/01/2007 34,000 35,278 Phillips Petroleum Co. 9.000% due 06/01/2001 2,000 2,010 Premium Asset Trust 7.029% due 09/08/2007 25,000 24,938 Procter & Gamble Co. 5.250% due 09/15/2003 35,900 36,220 Racers 6.930% due 03/03/2003 (d) 282,400 282,549 6.209% due 04/01/2003 (d) 20,000 19,956 8.760% due 04/28/2003 (d) 30,000 30,735 6.800% due 09/15/2005 (d) 15,000 14,967 Raytheon Co. 5.739% due 08/10/2001 (d) 74,100 74,186 7.310% due 03/01/2002 (d) 8,650 8,656 Rollins Truck Leasing Co. 8.250% due 05/01/2002 13,400 13,762 Saferco 9.590% due 05/31/2001 3,000 3,021 Safeway, Inc. 7.000% due 09/15/2002 1,125 1,146 6.850% due 09/15/2004 250 260 Sara Lee Corp. 6.300% due 11/07/2005 500 511 Scotia Pacific Co. LLC 7.710% due 01/20/2014 (d) 305 224 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 63 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Sears, Roebuck & Co. 8.390% due 02/14/2002 $ 240 $ 245 6.250% due 01/15/2004 300 301 SmithKline Beecham Corp. 7.375% due 04/15/2005 150 160 Sun Microsystems, Inc. 7.000% due 08/15/2002 200 202 TCI Communications, Inc. 7.176% due 04/03/2002 (d) 11,600 11,664 5.580% due 03/11/2003 (d) 5,000 5,030 6.375% due 05/01/2003 3,280 3,311 8.650% due 09/15/2004 625 672 8.000% due 08/01/2005 450 478 Tele-Communications, Inc. 8.250% due 01/15/2003 43,125 45,078 Tenet Healthcare Corp. 7.875% due 01/15/2003 10,300 10,519 8.625% due 12/01/2003 6,200 6,441 Texaco Capital, Inc. 8.500% due 02/15/2003 700 745 6.000% due 06/15/2005 400 409 Textron, Inc. 6.750% due 09/15/2002 225 229 Time Warner, Inc. 6.100% due 12/30/2001 41,875 42,043 7.975% due 08/15/2004 19,770 21,087 Times Mirror Co. 6.650% due 10/15/2001 300 303 TRW, Inc. 6.450% due 06/15/2001 31,135 31,102 6.625% due 06/01/2004 8,925 8,856 Tyco International Group SA 6.125% due 06/15/2001 5,600 5,605 6.875% due 09/05/2002 675 685 Union Pacific Corp. 7.875% due 02/15/2002 8,000 8,156 7.365% due 07/01/2002 (d) 25,500 25,543 6.930% due 06/01/2003 1,000 1,030 6.000% due 09/01/2003 8,000 8,000 6.120% due 02/01/2004 250 249 Unisys Corp. 9.210% due 01/21/2017 2,000 2,114 United Air Lines, Inc. 9.200% due 03/22/2008 3,950 4,311 10.360% due 11/13/2012 7,000 7,826 10.020% due 03/22/2014 6,925 7,490 10.850% due 07/05/2014 34,111 39,667 10.850% due 02/19/2015 1,500 1,725 10.125% due 03/22/2015 14,300 15,651 9.060% due 06/17/2015 5,000 5,095 United Technologies Corp. 7.125% due 11/15/2010 450 486 US Airways, Inc. 6.850% due 01/30/2018 143 138 UST, Inc. 7.250% due 06/01/2009 15,000 14,278 USX Corp. 9.800% due 07/01/2001 24,050 24,294 Wal-Mart Stores, Inc. 8.625% due 04/01/2001 2,450 2,450 6.150% due 08/10/2001 450 452 6.750% due 05/24/2002 170 173 6.500% due 06/01/2003 200 207 Walt Disney Co. 5.125% due 12/15/2003 500 499 Waste Management, Inc. 6.700% due 05/01/2001 10,000 10,002 6.000% due 05/15/2001 28,800 28,762 6.125% due 07/15/2001 23,900 23,857 6.375% due 12/01/2003 200 200 6.500% due 05/15/2004 94,000 94,015 Witco Corp. 6.600% due 04/01/2003 100 99 Yorkshire Power 6.154% due 02/25/2003 17,000 17,008 ------------- 2,972,965 ------------- Utilities 5.9% Alabama Power Co. 5.350% due 11/15/2003 1,600 1,590 Allete 6.499% due 10/20/2003 (d) 79,700 79,786 Appalachian Power Co. 7.270% due 06/27/2001 (d) 20,000 20,006 Arizona Public Service Co. 6.109% due 11/15/2001 (d) 14,000 14,015 Ashland, Inc. 8.450% due 12/05/2001 3,000 3,069 7.253% due 03/07/2003 (d) 300 300 AT&T Canada, Inc. 0.000% due 11/01/2007 1,000 899 0.000% due 06/15/2008 14,630 12,178 AT&T Corp. 5.125% due 04/01/2001 600 600 7.350% due 08/27/2001 7,200 7,258 7.125% due 01/15/2002 275 278 Baltimore Gas & Electric 6.125% due 07/01/2003 150 153 Bell Atlantic Maryland, Inc. 8.000% due 10/15/2029 1,125 1,217 Bell Atlantic Virginia, Inc. 5.625% due 03/01/2007 500 486 BellSouth Telecommunications, Inc. 6.000% due 06/15/2002 10,000 10,119 6.250% due 05/15/2003 100 102 British Telecommunications PLC 6.079% due 12/15/2003 (d) 94,800 94,839 7.625% due 12/15/2005 5,000 5,179 8.125% due 12/15/2010 (d) 83,000 86,717 Calpine Corp. 9.250% due 02/01/2004 4,150 4,152 CE Electric Funding 6.853% due 12/30/2004 250 252 Central Maine Power Co. 7.430% due 08/25/2003 13,000 13,552 Central Power & Light Co. 7.351% due 11/23/2001 (d) 18,100 18,121 Cleveland Electric Illuminating Co. 9.500% due 05/15/2005 33,000 34,158 CMS Energy Corp. 8.375% due 07/01/2003 15,000 15,276 7.000% due 01/15/2005 41,325 39,637 8.000% due 07/01/2011 1,000 1,002 Columbia Energy Group 6.610% due 11/28/2002 5,000 5,094 Columbus Southern Power Co. 6.850% due 10/03/2005 10,000 10,299 Commonwealth Edison Co. 6.625% due 07/15/2003 1,000 1,025 7.145% due 09/30/2003 (d) 17,700 17,706 9.875% due 06/15/2020 11,700 13,213 Connecticut Light & Power Co. 7.875% due 06/01/2001 5,100 5,119 7.750% due 06/01/2002 5,000 5,116 8.590% due 06/05/2003 27,000 29,085 Consolidated Edison, Inc. 6.625% due 02/01/2002 100 101 6.720% due 06/15/2002 (d) 11,000 11,014 6.375% due 04/01/2003 1,000 1,018 Consolidated Natural Gas Co. 7.250% due 10/01/2004 43,750 45,631 Constellation Energy Group 7.219% due 04/04/2003 (d) 15,000 14,971 Detroit Edison Co. 7.210% due 08/01/2002 1,000 1,029 6.341% due 07/15/2028 1,000 993 Dominion Resources, Inc. 7.600% due 07/15/2003 35,000 36,440 DTE Capital Corp. 8.350% due 11/15/2038 (d) 90,250 92,148 Duke Energy Corp. 5.875% due 06/01/2001 375 375 64 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- El Paso Electric Co. 9.400% due 05/01/2011 $ 7,455 $ 8,269 El Paso Energy Corp. 6.625% due 07/15/2001 27,000 27,119 El Paso Natural Gas Co. 7.750% due 01/15/2002 15,000 15,264 Entergy Arkansas, Inc. 7.000% due 03/01/2002 3,580 3,620 7.720% due 03/01/2003 200 207 Entergy Gulf States, Inc. 6.410% due 08/01/2001 5,800 5,819 Entergy Louisiana, Inc. 7.740% due 07/01/2002 599 600 8.500% due 06/01/2003 3,000 3,162 Entergy Mississippi, Inc. 7.409% due 05/03/2004 (d) 31,000 31,008 Exelon Corp. 5.625% due 11/01/2001 22,350 22,419 Florida Power & Light 6.875% due 12/01/2005 4,000 4,191 France Telecom 6.308% due 03/14/2003 (d) 83,200 83,246 Georgia Power Co. 5.620% due 02/22/2002 (d) 15,000 15,004 Global Crossing Ltd. 8.950% due 08/07/2001 3,000 3,040 GTE California, Inc. 5.500% due 01/15/2009 100 95 GTE South, Inc. 7.250% due 08/01/2002 150 154 Houston Lighting & Power Co. 8.750% due 03/01/2022 10,000 10,496 Indiana Bell Telephone Co., Inc. 5.500% due 04/01/2007 500 479 Indiana Michigan Power Co. 7.305% due 09/03/2002 (d) 5,000 5,004 Indianapolis Power & Light Co. 7.375% due 08/01/2007 225 237 Kinder Morgan, Inc. 6.450% due 11/30/2001 10,000 10,052 6.450% due 03/01/2003 240 243 Korea Electric Power Corp. 7.000% due 10/01/2002 380 385 6.375% due 12/01/2003 220 221 Marlin Water Trust 7.090% due 12/15/2001 11,238 11,337 Mirant Corp. 7.900% due 07/15/2009 175 174 Montana Power Co. 7.053% due 04/06/2001 (d) 15,000 15,008 National Power Corp. 9.625% due 05/15/2028 16,000 11,131 Nevada Power Co. 5.990% due 08/20/2001 (d) 1,200 1,201 6.200% due 04/15/2004 20,000 19,596 New England Telephone & Telegraph Co. 6.250% due 03/15/2003 50 51 6.375% due 09/01/2008 1,350 1,316 New York Telephone Co. 6.250% due 02/15/2004 150 153 6.000% due 04/15/2008 45 45 Niagara Mohawk Power Co. 7.125% due 07/01/2001 34,644 34,786 7.250% due 10/01/2002 24,783 25,309 7.375% due 07/01/2003 39,162 40,170 7.375% due 08/01/2003 1,645 1,709 NorAm Energy Corp. 8.920% due 05/15/2001 7,000 7,026 6.375% due 11/01/2003 22,250 22,726 Nortel Networks Corp. 8.750% due 06/12/2001 300 302 6.875% due 10/01/2002 200 204 Northern Illinois Gas Co. 6.450% due 08/01/2001 1,450 1,454 NRG Energy, Inc. 8.000% due 11/01/2003 6,000 6,185 NRG Northeast Generating LLC 8.065% due 12/15/2004 422 435 Ohio Bell Telephone Co. 5.375% due 03/01/2007 950 906 Ohio Power Co. 7.000% due 07/01/2004 24,000 24,642 Oneok, Inc. 7.390% due 04/24/2002 (d) 8,000 8,014 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(e) 33,700 27,803 5.875% due 10/01/2005 (e) 100 85 7.375% due 11/01/2005 (e) 22,000 16,830 7.250% due 08/01/2026 (e) 10,000 8,350 Pacific Northwest Bell Telephone 4.375% due 09/01/2002 50 49 Portland General Electric Co. 7.660% due 01/14/2002 5,000 5,103 PP&L, Inc. 6.125% due 05/01/2001 (d) 16,102 16,110 6.550% due 03/01/2006 500 510 PSEG Energy Holdings, Inc. 9.125% due 02/10/2004 120 124 Public Service Co. of Colorado 6.000% due 04/15/2003 750 759 Public Service Electric & Gas Co. 7.250% due 04/01/2001 (d) 3,191 3,191 6.125% due 08/01/2002 1,000 1,010 6.250% due 01/01/2007 1,500 1,505 Public Service Enterprise Group, Inc. 7.035% due 06/15/2001 (d) 156,200 156,327 Queststar Pipeline Co. 9.375% due 06/01/2021 200 210 RAS LAFFAN Liquid Natural Gas 8.294% due 03/15/2014 145 145 Reliant Energy, Inc. 9.375% due 06/01/2001 2,000 2,008 Scana Corp. 5.910% due 02/08/2002 (d) 13,900 13,918 6.329% due 07/15/2002 (d) 38,800 38,871 Sierra Pacific Power Co. 7.160% due 06/12/2001 (d) 46,000 46,000 Sierra Pacific Resources 6.299% due 04/20/2002 (d) 500 425 6.249% due 04/20/2003 (d) 2,000 1,700 Sonat, Inc. 9.000% due 05/01/2001 100 100 Southern California Edison Co. 6.500% due 06/01/2001 200 167 7.204% due 05/01/2002 (d) 24,000 19,560 Sprint Capital Corp. 9.500% due 06/06/2001 150 151 5.679% due 11/15/2001 (d) 144,900 145,094 6.500% due 11/15/2001 14,365 14,472 7.010% due 06/10/2002 (d) 14,400 14,422 7.625% due 06/10/2002 7,000 7,177 6.850% due 06/24/2002 (d) 62,500 62,562 8.125% due 07/15/2002 10,378 10,652 System Energy Resources, Inc. 7.710% due 08/01/2001 5,800 5,843 TECO Energy, Inc. 5.540% due 09/15/2001 44,630 44,796 Telekomunikacja Polska SA 7.125% due 12/10/2003 12,200 12,250 7.750% due 12/10/2008 7,895 7,663 Tennessee Valley Authority 0.000% due 04/15/2042 855 410 Texas Utilities Corp. 5.420% due 06/25/2001 (d) 173,900 173,875 6.370% due 08/16/2001 1,000 1,004 7.389% due 09/24/2001 (d) 160,100 158,574 5.940% due 10/15/2001 3,000 3,014 6.500% due 08/16/2002 2,600 2,635 6.750% due 03/01/2003 150 153 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 65 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Toledo Edison Co. 8.180% due 07/30/2002 $ 1,400 $ 1,440 8.700% due 09/01/2002 24,500 25,208 7.850% due 03/31/2003 7,000 7,226 7.875% due 08/01/2004 500 531 Transcontinental Gas Pipe Corp. 7.080% due 07/15/2026 15,000 15,055 TXU Eastern Funding Co. 6.150% due 05/15/2002 61,800 62,109 6.450% due 05/15/2005 15,270 15,218 Union Electric Co. 8.000% due 12/15/2022 1,000 1,022 Vodafone Group PLC 6.736% due 12/19/2001 (d) 23,900 23,940 7.750% due 02/15/2010 500 540 Western Massachusetts Electric Co. 7.375% due 07/01/2001 23,235 23,303 Williams Cos., Inc. 5.889% due 11/15/2001 (d) 26,800 26,839 6.200% due 08/01/2002 5,000 5,032 Wilmington Trust Co. - Tucson Electric 10.732% due 01/01/2013 (l) 991 1,094 WorldCom, Inc. 6.125% due 08/15/2001 3,030 3,035 6.981% due 11/26/2001 (d) 22,100 22,037 8.875% due 01/15/2006 3,000 3,099 6.125% due 04/15/2012 1,250 1,252 ------------- 2,503,119 ------------- Total Corporate Bonds & Notes 14,831,152 (Cost $14,798,070) ------------- -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 1.0% -------------------------------------------------------------------------------- Alabama 0.0% Jefferson County, Alabama Sewer Revenue Warrants, (FGIC Insured), Series 2001 5.000% due 5,000 4,694 02/01/2041 Jefferson County, Alabama Sewer Revenue Bonds Warrants, (FGIC Insured), Series 2000-323 6.560% 4,500 4,337 due 02/01/2029 (d) Jefferson County, Alabama Sewer Revenue Bonds Warrants, (FGIC Insured), Series 2000-352 5.912% 625 573 due 02/01/2036 (d) Jefferson County, Alabama Sewer Revenue Bonds, (FGIC Insured), Series 2001 6.940% due 5,500 5,170 02/01/2039 Montgomery Alabama Special Care Facilities Financing Authority Revenue Bonds, (MBIA Insured), Series 2000 5.410% due 11/15/2029 1,000 890 ------------- 15,664 ------------- California 0.1% California State Department of Water Resources Center Valley Project Revenue Bonds, Series 2000 6.030% due 12/01/2029 2,500 2,378 California State General Obligation Bonds, Series 2000 7.290% due 05/01/2026 2,635 2,875 Fairfield California Redevelopment Agency Tax Allocation, Series 1997 7.700% due 06/01/2002 10 10 Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, Series 1995 0.000% due 01/01/2026 9,000 2,449 0.000% due 01/01/2030 3,590 785 Los Angeles County Metropolitan Transportation Authority Sales Tax Revenue Bonds, (AMBAC Insured), Series 2000 5.740% due 07/01/2023 3,500 3,434 Los Angeles, California Wastewater System Revenue Bonds, (FGIC Insured), Series 2000 6.700% due 6,500 6,313 06/01/2028 Modesto California Financing Authority Revenue, (AMBAC Insured), Series 1998 5.000% due 09/01/2029 300 295 Orange County School Board, (MBIA Insured), Series 2000 5.710% due 08/01/2024 3,500 3,360 Port of Oakland, California Revenue Bonds, (FGIC Insured), Series 2000 5.750% due 11/01/2029 1,000 1,054 San Diego Public Facilities Financing Authority Revenue Bonds, (FGIC Insured), Series 1999 5.000% due 1,000 984 05/15/2029 San Francisco, California City & County Common International Airport Revenue Bonds, (MBIA Insured), Series 2000 4.840% due 05/01/2028 3,350 2,680 ------------- 26,617 ------------- Colorado 0.0% Denver Colorado City & County Airport Revenue Bonds, Series 2000 5.980% due 11/15/2025 2,500 2,356 E-470 Public Highway Authority Revenue Bonds, (MBIA Insured), Series 2000 5.750% due 2,500 2,659 09/01/2035 ------------- 5,015 ------------- Florida 0.1% Broward County Florida Airport System Revenue, (AMBAC Insured), Series 2000 5.030% due 1,328 1,176 10/01/2023 Florida State Board of Education General Obligation, (FGIC Insured), Series 2000 4.710% due 3,500 2,835 06/01/2023 Florida State Governmental Utility Authority Utility Revenue, (AMBAC Insured), Series 2000 5.710% due 6,453 6,073 10/01/2029 Florida State Turnpike Authority Revenue Bonds, (FGIC Insured), Series 2000 4.440% due 6,323 4,932 07/01/2027 Greater Orlando Aviation Authority, Orlando Florida Airport Facitities Revenue Bonds, (FGIC Insured), Series 1999 5.125% due 10/01/2028 2,000 1,940 Lakeland Florida Electric & Water Revenue Bonds, (MBIA Insured), Series 2000 5.000% due 2,675 2,528 10/01/2028 Modesto Public Financing Authority Lease Revenue, (AMBAC Insured), Series 2000 5.740% due 2,500 2,419 09/01/2029 Tampa, Florida Guaranteed Entitlement Revenue, (AMBAC Insured), Series 2001 6.000% due 2,230 2,433 10/01/2005 Tampa, Florida Utility Tax & Special Revenue, (AMBAC Insured), Series 2001 6.000% due 10/01/2005 3,000 3,278 6.000% due 10/01/2008 1,500 1,682 ------------- 29,296 ------------- Georgia 0.1% Atlanta, Georgia Airport Revenue, (FGIC Insured), Series 2000 5.500% due 01/01/2026 1,000 1,035 Atlanta, Georgia Water & Wastewater Revenue Bonds, (FGIC Insured), Series 2000 5.440% due 22,300 20,405 11/01/2038 Georgia Local Government Certificate Of Participation, (MBIA Insured), Series 2000 5.810% due 9,950 8,706 06/01/2028 ------------- 30,146 ------------- Hawaii 0.0% Honolulu Hawaii City & County Wastewater System Revenue Bonds, (FGIC Insured), Series 2000 5.290% due 07/01/2023 3,468 3,259 5.210% due 07/01/2028 7,200 6,048 ------------- 9,307 ------------- 66 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Illinois 0.1% Chicago, Illinois Skyway Toll Bridge Revenue Bonds, (AMBAC Insured), Series 2000 5.500% due 01/01/2031 $ 2,000 $ 2,045 Chicago, Illinois Board Education General Obligation, (FGIC Insured), Series 1998 0.000% due 15,000 3,525 12/01/2027 Chicago, Illinois General Obligations, (FGIC Insured), Series 2000 5.500% due 01/01/2035 2,500 2,550 5.500% due 01/01/2040 3,000 3,049 6.980% due 01/01/2040 4,750 4,904 Chicago, Illinois Midway Airport Revenue Bonds, (MBIA Insured), Series 1998 5.000% due 7,000 6,641 01/01/2035 Chicago, Illinois Residual General Obligation, (MBIA Insured), Series 2000 5.960% due 01/01/2028 3,100 2,945 Chicago, Illinois Sales Tax Revenue Bonds, (FGIC Insured), Series 1999 5.375% due 01/01/2030 15,000 15,098 Cook County Illinois General Obligation, (FGIC Insured), Series 2000 5.000% due 11/15/2028 3,220 2,942 Cook County Illinois General Obligation, (FGIC Insured), Series 2001 6.690% due 11/15/2028 3 2 ------------- 43,701 ------------- Kansas 0.0% Wichita, Kansas Hospital Revenue Bonds, Series 1999 6.250% due 11/15/2024 1,000 1,054 Massachusetts 0.2% Boston Massachussetts Water & Sewer Common Revenue Bonds, (FGIC Insured), Series 2000 5.510% due 11/01/2028 3,500 3,255 E-470 Public Highway Residual 144a Revenue Bonds, (MBIA Insured), Series 2000 5.710% due 2,590 2,545 09/01/2021 Massachusetts Bay Transportation Authority Revenue Bonds, (MBIA Insured), Series 2000 5.260% due 4,150 3,709 03/01/2021 Massachusetts State Turnpike Authority Metro Highway System Revenue Bonds, (MBIA Insured), Series 1997 5.000% due 01/01/2037 6,000 5,648 Massachusetts State Turnpike Authority Revenue Bonds, (AMBAC Insured), Series 2000 5.910% due 10,250 9,084 01/01/2039 Massachusetts State Turnpike Authority Revenue Bonds, (MBIA Insured), Series 2000 7.960% due 21,050 19,603 01/01/2037 Southbridge Associations Limited Liability Corporation Massachussetts, (MBIA-Insured), Series 2000 7.590% due 02/01/2022 31,105 32,621 ------------- 76,465 ------------- Minnesota 0.0% Minnesota Agricultural & Economic Development Board Revenue Bonds, Series 2000 6.375% due 1,000 1,055 11/15/2029 ------------- Mississippi 0.0% Mississippi Development Bank Special Obligation, (AMBAC Insured), Series 2000 5.810% due 2,500 2,400 07/01/2024 ------------- Nevada 0.1% Clark County Nevada General Obligations, (MBIA Insured), Series 2000 8.440% due 07/01/2030 20,913 21,801 Clark County Passenger Facility Charge Revenue, (MBIA Insured), Series 2000 5.210% due 07/01/2022 4,750 4,192 ------------- 25,993 ------------- New Jersey 0.0% Essex County New Jersey Important Authority Lease Revenue Bonds, (FGIC Insured), Series 2000 7.090% due 10/01/2030 250 280 Mercer County New Jersey Important Authority Revenue Bonds, Series 2000 7.140% due 3,103 3,669 01/01/2018 New Jersey Health Care Facilities Financing Authority Revenue Bonds, (MBIA Insured), Series 2000 5.130% due 07/01/2028 2,000 1,740 ------------- 5,689 ------------- New York 0.2% Long Island Power Authority New York Electric System Revenue Bonds, (FSA Insured), Series 2001 7.040% due 12/01/2022 4,000 4,000 Long Island Power Authority Revenue Bonds, (FSA Insured), Series 2000 6.160% 4,500 4,410 due 12/01/2022 Long Island Power Authority Revenue Bonds, (MBIA Insured), Series 2000 6.410% 5,500 5,548 due 12/01/2026 New York City Municipal Bond, Series 1997 7.001% due 08/01/2002 (d) 6,108 6,108 New York City Municipal Water Finance Authority, (MBIA-Insured), 6,565 5,654 Series 2000 5.130% due 06/15/2025 New York City Transitional Finance Authority Revenue Bonds, Series 1998 4.750% due 05/01/2023 6,000 5,610 New York City, New York General Obligation, Series 1997-D 6.899% due 08/01/2002 (d) 9,040 9,040 New York City, New York Municipal Water Financial Authority Water & Sewer System Revenue Bonds, (FSA Insured), Series 2000 5.510% due 06/15/2029 3,000 2,839 New York City, New York Transitional Financial Authority Revenue Bonds, Series 2000 6.510% due 1,250 1,203 11/01/2024 New York City, New York Transitional Financing Authority Revenue Bonds, (FGIC-TCRS Insured), Series 2000 4.790% due 11/15/2023 2,500 2,191 New York State Dormitory Authority Lease Revenue Bonds, (FSA Insured), Series 1998 4.750% 7,300 6,709 due 01/15/2029 New York State Dormitory Authority Revenue Bonds, (MBIA Insured), Series 2000 5.000% 2,550 2,352 due 02/15/2023 Niagara Frontier Airport Revenue Bonds, (MBIA Insured), Series 1999 5.625% due 04/01/2029 1,000 1,024 Port Authority New York & New Jersey Special Obligation Revenue Bonds, (MBIA Insured), Series 2000 7.600% due 12/01/2022 3,250 3,575 Westchester County New York Health Care Corp. Revenue, Series 2000 5.875% due 11/02/2025 2,875 2,965 ------------- 63,228 ------------- North Dakota 0.0% Mercer County Improvement Authority Revenue Bonds, Series 1978 5.800% due 01/01/2018 55 60 ------------- Ohio 0.0% Hamilton County Ohio Sales Tax Revenue Bonds, (MBIA Insured), Series 2000 5.460% due 12/01/2027 3,250 3,092 ------------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 67 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Pennsylvania 0.0% Allegheny County Hospital Development Authority Revenue Bonds, (MBIA Insured), Series 2000 A 6.500% due 11/15/2030 $ 1,000 $ 1,103 Philadelphia School District General Obligation, (MBIA Insured), Series 2000 5.210% due 3,150 2,705 04/01/2027 Pittsburgh & Allegheny County Revenue Bonds, (AMBAC Insured), Series 1999 5.000% due 500 484 02/01/2029 ------------- 4,292 ------------- Puerto Rico 0.0% Puerto Rico Commonwealth General Obligation, (MBIA Insured), Series 2000 5.750% due 3,990 4,269 07/01/2026 Puerto Rico Commonwealth Highway & Transiton Authority Transition Revenue Bonds, (MBIA Insured), Series 2000 5.875% due 07/01/2035 4,930 5,349 ------------- 9,618 ------------- Texas 0.1% Dallas-Fort Worth International Airport Revenue, (FGIC Insured), Series 2000 6.000% due 4,000 4,220 11/01/2028 Denton County, Texas Utility System Revenue Bonds, (MBIA Insured), Series 2000 5.680% due 3,000 2,876 12/01/2029 Grapevine-Colleyville Independent General Obligation, (PSF-GTD Insured), Series 2000 6.000% 10,500 8,584 due 08/15/2029 Harris County Health Facilities Development Corporation Revenue, (MBIA Insured), Series 2000 6.140% due 07/01/2021 3,500 3,395 Houston Independent School District General Obligation, (PSF Insured), Series 1999 4.750% due 15,000 13,725 02/15/2026 Houston, Texas Airport System Revenue Bonds, (FGIC Insured), Series 2000 5.290% due 2,750 2,585 07/01/2025 Houston, Texas Airport System Revenue Bonds, (FGIC Insured), Series 2001 5.000% due 10,000 8,975 07/01/2028 Houston, Texas Independent School District (PSF-GTD Insured), Series 2000 4.790% 15,088 12,541 due 02/15/2026 Houston, Texas Water & Sewer System Revenue, (FGIC Insured), Series 2000 5.250% due 1,000 998 12/01/2030 North Texas Towey Authority Dallas North Towey System Revenue Bonds, (FGIC Insured), Series 1998 4.750% due 01/01/2029 4,000 3,675 ------------- 61,574 ------------- Utah 0.0% Weber County, Utah Hospital Revenue Bonds, Series 1999 5.000% due 08/15/2030 500 462 Washington State 0.0% Seattle Washington General Obligation, Series 2000 5.960% due 12/15/2028 3,000 2,925 Washington, DC 0.0% Washington D.C. Convention Center Authority Dedicated Tax Revenue, (AMBAC Insured), Series 2000 5.030% due 10/01/2028 6,500 5,363 ------------- Total Municipal Bonds & Notes 423,016 (Cost $385,483) ------------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 1.1% -------------------------------------------------------------------------------- A.I.D. Housing Guarantee - Peru 9.980% due 08/01/2008 $ 825 $ 846 Fannie Mae 6.590% due 05/24/2001 500 501 0.000% due 08/15/2001 105 103 6.100% due 09/14/2001 100 101 5.375% due 03/15/2002 750 756 6.500% due 09/05/2002 325 325 6.250% due 11/15/2002 385 395 5.250% due 01/15/2003 250 253 6.030% due 05/15/2003 9,950 9,968 4.750% due 11/14/2003 250 250 5.500% due 12/29/2003 500 508 5.125% due 02/13/2004 4,594 4,648 5.625% due 05/14/2004 1,525 1,558 5.750% due 06/15/2005 900 919 6.625% due 10/15/2007 650 692 6.560% due 12/10/2007 190 195 5.750% due 02/15/2008 400 406 6.000% due 05/15/2008 2,950 3,035 5.250% due 01/15/2009 80 78 5.870% due 01/28/2009 200 198 6.375% due 06/15/2009 2,070 2,168 6.625% due 09/15/2009 1,000 1,062 7.250% due 01/15/2010 2,930 3,238 7.125% due 06/15/2010 60,500 66,580 6.875% due 09/10/2012 1,000 1,050 6.930% due 09/17/2012 1,000 1,057 6.875% due 09/24/2012 2,000 2,109 6.250% due 05/15/2029 2,340 2,344 7.125% due 01/15/2030 325 362 7.250% due 05/15/2030 42 48 Federal Farm Credit Bank 6.400% due 01/16/2002 100 101 5.730% due 03/28/2003 300 306 6.050% due 12/07/2005 200 207 6.060% due 05/28/2013 100 101 Federal Home Loan Bank 6.500% due 04/26/2001 65 65 6.690% due 05/16/2001 400 401 4.875% due 01/22/2002 115 115 5.805% due 02/15/2002 (d) 17,000 17,080 6.210% due 12/30/2002 200 205 5.125% due 09/15/2003 350 354 5.135% due 09/22/2003 600 604 7.350% due 10/06/2003 42,500 42,513 6.000% due 06/30/2004 1,000 1,032 7.360% due 07/01/2004 500 537 6.250% due 08/13/2004 250 260 5.890% due 06/30/2008 1,000 1,021 5.800% due 09/02/2008 2,000 2,024 6.026% due 01/22/2009 275 273 0.000% due 09/29/2017 2,000 551 0.000% due 09/10/2018 15,000 4,473 0.000% due 12/21/2018 4,250 1,293 Freddie Mac 5.750% due 06/15/2001 668 670 5.500% due 05/15/2002 435 440 7.000% due 02/15/2003 500 521 7.375% due 05/15/2003 3,500 3,692 5.750% due 07/15/2003 350 358 6.250% due 07/15/2004 250 260 6.875% due 01/15/2005 495 525 7.440% due 09/20/2006 1,500 1,520 6.765% due 03/12/2007 400 428 5.750% due 04/15/2008 400 406 9.000% due 09/15/2008 18 19 5.750% due 03/15/2009 1,955 1,968 10.250% due 03/15/2009 8 9 6.625% due 09/15/2009 1,985 2,107 6.750% due 06/03/2013 400 398 68 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SallieMae 5.979% due 10/25/2004 (d) $ 17,299 $ 17,291 6.896% due 10/25/2004 (d) 11,644 11,632 7.115% due 07/25/2006 (d) 0 0 Small Business Administration 7.449% due 08/01/2010 122,044 128,782 7.700% due 07/01/2016 699 739 6.950% due 11/01/2016 4,149 4,270 6.700% due 12/01/2016 15,898 16,196 7.150% due 03/01/2017 7,636 7,918 7.190% due 12/01/2019 486 505 7.630% due 06/01/2020 23,668 25,069 6.900% due 12/01/2020 10,000 10,186 6.340% due 03/01/2021 33,416 33,416 ------------- Total U.S. Government Agencies 448,594 (Cost $437,557) ------------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 13.5% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (i) 3.625% due 07/15/2002 (b) 1,316,075 1,341,986 3.375% due 01/15/2007 (j) 296,572 299,816 3.625% due 01/15/2008 (j) 780,832 799,134 3.875% due 01/15/2009 (j) 474,836 493,829 3.625% due 04/15/2028 (j) 221,455 225,815 3.875% due 04/15/2029 (j) 132,096 141,013 U.S. Treasury Bonds 10.375% due 11/15/2012 305 396 12.000% due 08/15/2013 22,500 32,056 9.250% due 02/15/2016 147,500 203,766 7.250% due 05/15/2016 2,000 2,359 7.500% due 11/15/2016 450 543 8.875% due 02/15/2019 18,675 25,630 8.125% due 08/15/2019 75 97 8.750% due 08/15/2020 208,486 333,200 7.875% due 02/15/2021 1,390 1,766 8.125% due 05/15/2021 85,600 111,454 8.125% due 08/15/2021 14,450 18,841 8.000% due 11/15/2021 5,000 6,450 7.125% due 02/15/2023 204,300 242,660 6.250% due 08/15/2023 12,430 13,404 6.875% due 08/15/2025 11,600 13,495 6.000% due 02/15/2026 156,100 163,719 6.625% due 02/15/2027 700 794 5.500% due 08/15/2028 70,300 69,103 6.125% due 08/15/2029 1 1 U.S. Treasury Notes 6.625% due 07/31/2001 75 76 6.375% due 08/15/2002 4,500 4,631 6.250% due 08/31/2002 1,430 1,470 6.250% due 02/15/2003 1,000 1,036 4.250% due 11/15/2003 85,000 84,811 12.375% due 05/15/2004 (b) 1,000 1,226 6.000% due 08/15/2004 3,500 3,665 5.875% due 11/15/2004 265,700 277,571 6.750% due 05/15/2005 402,300 434,979 6.875% due 05/15/2006 1,000 1,101 5.625% due 05/15/2008 1,625 1,697 5.750% due 08/15/2010 1,830 1,929 5.750% due 11/15/2005 84,800 88,947 U.S. Treasury Strips 0.000% due 11/15/2001 43 42 0.000% due 05/15/2013 4,500 2,356 0.000% due 02/15/2014 64,900 32,157 0.000% due 02/15/2015 105,000 48,595 0.000% due 05/15/2015 182,700 83,082 0.000% due 08/15/2015 170,500 75,697 0.000% due 11/15/2018 108,200 39,243 0.000% due 02/15/2019 2,000 716 0.000% due 05/15/2020 22,000 7,292 ------------- Total U.S. Treasury Obligations 5,733,646 (Cost $5,580,480) ------------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 76.7% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 25.2% ABN AMRO Mortgage Corp. 6.750% due 09/25/2028 3,765 3,745 6.750% due 11/25/2028 600 583 6.500% due 06/25/2029 7,093 6,857 American Southwest Financial Securities Corp. 7.400% due 11/17/2004 26,491 27,176 12.500% due 04/01/2015 238 239 12.000% due 05/01/2015 433 447 7.248% due 11/25/2038 56,843 59,232 Amresco Commercial Mortgage Funding I 7.180% due 06/17/2029 55 58 Aurora Loan Services 7.319% due 05/25/2030 (d) 36,969 37,097 Banc of America Funding Corp. 6.750% due 11/20/2032 17,000 17,252 Bank of America Mortgage Securities, Inc. 6.250% due 07/25/2014 9,800 9,734 6.250% due 08/25/2028 25,000 23,769 6.500% due 05/25/2029 35,391 34,371 7.250% due 10/25/2029 10,753 10,841 7.500% due 01/25/2031 166,584 170,203 7.500% due 02/25/2031 12,864 13,167 7.000% due 03/25/2032 53,400 54,220 Bear Stearns Adjustable Rate Mortgage Trust 7.497% due 11/25/2030 (d) 138,892 139,510 7.490% due 12/25/2030 (d) 153,119 154,719 7.499% due 12/25/2030 (d) 156,231 158,008 6.944% due 02/25/2031 (d) 20,835 21,037 7.499% due 02/25/2031 (d) 33,766 34,067 Bear Stearns Commercial Mortgage Securities, Inc. 5.910% due 05/14/2008 131 132 7.000% due 05/20/2030 45,308 46,837 Bear Stearns Mortgage Securities, Inc. 6.097% due 10/25/2023 (d) 2,566 2,716 10.000% due 08/25/2024 5,000 5,645 7.000% due 03/25/2027 7,000 7,095 8.125% due 09/25/2027 2,977 3,071 7.000% due 02/25/2028 10,000 10,168 7.421% due 06/25/2030 (d) 5,972 5,972 Capco America Securitization Corp. 5.860% due 12/15/2007 45 45 CDC Depositor Trust I 6.311% due 01/15/2003 (d) 14,534 14,481 Cendant Mortgage Corp. 7.250% due 04/18/2013 757 761 6.503% due 11/18/2028 (d) 6,148 5,434 6.505% due 11/18/2028 (d) 13,528 13,211 Chase Mortgage Finance Corp. 7.000% due 07/25/2024 1,789 1,788 7.000% due 08/25/2024 2,791 2,827 6.750% due 03/25/2025 11,840 11,198 8.494% due 04/25/2025 (d) 8,476 8,650 6.750% due 10/25/2028 39,000 38,987 6.350% due 07/25/2029 62,292 63,147 7.750% due 08/25/2030 9,962 10,403 Chemical Mortgage Securities, Inc. 7.250% due 01/25/2026 11,329 11,644 Citibank, NA 8.000% due 07/25/2018 37 37 Citicorp Mortgage Securities, Inc. 7.963% due 10/25/2022 (d) 8,985 9,117 6.250% due 04/25/2024 11,796 11,249 6.250% due 05/25/2024 1,865 1,864 7.250% due 10/25/2027 20,462 20,811 6.500% due 11/25/2027 14,015 14,013 6.750% due 09/25/2028 9,334 9,343 5.900% due 05/25/2029 2,286 2,280 7.000% due 09/25/2030 7,249 7,166 7.500% due 10/25/2030 11,588 11,773 7.000% due 02/25/2031 34,210 34,131 CMC Securities Corp. II 8.625% due 04/25/2025 (d) 110 109 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 69 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CMC Securities Corp. III 6.750% due 05/25/2028 $ 5,000 $ 5,040 CMC Securities Corp. IV 7.250% due 11/25/2027 10,436 10,722 Collateralized Mortgage Obligation Trust 7.250% due 04/23/2017 56 57 8.000% due 09/20/2021 5,730 5,845 Collateralized Mortgage Obligation Trust I 10.200% due 02/01/2016 1,957 2,001 Collateralized Mortgage Securities Corp. 11.450% due 11/01/2015 (d) 115 115 8.750% due 04/20/2019 358 371 8.800% due 04/20/2019 237 247 COMM 6.145% due 02/15/2008 14,528 14,739 6.488% due 12/16/2011 (d) 9,000 9,014 Commercial Mortgage Acceptance Corp. 7.030% due 05/15/2009 75 79 Commercial Mortgage Asset Trust 6.640% due 09/17/2010 455 467 6.975% due 04/17/2013 145 151 Countrywide Alternative Loan Trust 8.000% due 07/25/2030 18,606 19,088 Countrywide Funding Corp. 6.625% due 02/25/2024 33,827 33,584 6.750% due 03/25/2024 12,679 12,164 Countrywide Home Loans 6.500% due 07/25/2013 5,676 5,695 6.250% due 08/25/2014 3,718 3,695 8.795% due 07/25/2024 (d) 1,462 1,474 6.750% due 11/25/2025 25,567 25,195 7.500% due 04/25/2027 1,523 1,580 7.500% due 06/25/2027 12,045 12,467 7.500% due 09/25/2027 20,000 20,527 7.250% due 12/25/2027 6,224 6,232 7.250% due 02/25/2028 57,846 58,732 6.750% due 06/25/2028 15,103 14,553 6.750% due 08/25/2028 6,961 6,975 6.750% due 10/25/2028 15,567 15,049 6.750% due 11/25/2028 5,000 4,978 6.500% due 01/25/2029 24,978 24,619 6.500% due 03/25/2029 21,744 21,100 6.050% due 04/25/2029 1,135 1,141 7.250% due 08/25/2029 5,700 5,630 7.750% due 04/25/2030 50,095 51,021 7.750% due 10/25/2030 30,527 30,827 7.750% due 01/25/2031 53,795 55,218 Credit-Based Asset Servicing and Securitization 5.940% due 09/25/2029 (d) 1,102 1,107 7.048% due 02/25/2030 (d) 46,942 46,978 Crusade Global Trust 5.719% due 05/15/2021 (d) 91,106 91,334 CS First Boston Mortgage Securities Corp. 6.960% due 01/20/2004 85 87 6.520% due 07/17/2007 50 51 6.750% due 12/27/2028 13,112 12,841 7.500% due 03/25/2031 50,000 50,491 Dime Savings 7.293% due 11/01/2018 (d) 166 154 DLJ Commercial Mortgage Corp. 6.025% due 09/05/2001 (d) 1,029 1,029 7.571% due 09/05/2001 (d) 2,000 2,010 6.880% due 05/05/2003 (d) 31,164 31,183 DLJ Mortgage Acceptance Corp. 6.446% due 08/01/2021 (d)(l) 3,454 3,454 8.000% due 03/25/2022 111 111 8.874% due 12/25/2022 (d) 1,273 1,289 9.054% due 03/25/2024 (d) 332 337 9.308% due 05/25/2024 (d) 89 90 9.488% due 10/25/2024 (d) 358 380 6.850% due 12/17/2027 6,605 6,835 Drexel Burnham Lambert Trust 9.500% due 11/20/2017 552 565 DVI Business Credit Receivable Corp. III 6.461% due 10/15/2003 (d) 3,850 3,881 Fannie Mae 7.500% due 05/25/2005 6,700 6,908 7.500% due 02/25/2006 375 386 7.000% due 05/25/2006 263 268 6.500% due 07/25/2006 34 34 8.000% due 11/25/2006 20 20 6.350% due 12/25/2006 5 5 7.500% due 05/25/2007 880 897 6.250% due 07/25/2007 52 52 6.000% due 07/25/2007 300 303 6.740% due 08/25/2007 145 151 5.243% due 08/25/2007 (d) 7 7 6.270% due 09/25/2007 3,000 3,049 7.000% due 10/25/2007 200 206 6.500% due 05/25/2008 500 512 10.500% due 08/25/2008 7,146 8,043 6.000% due 08/25/2008 50 50 7.684% due 09/25/2008 (d) 1,606 1,555 6.000% due 02/25/2009 1,400 1,421 4.000% due 02/25/2009 27 26 6.500% due 02/25/2009 50 50 6.500% due 03/25/2009 95 96 6.500% due 08/25/2010 500 500 6.750% due 11/25/2010 655 658 6.500% due 04/25/2013 75 78 6.000% due 03/18/2015 6,888 6,897 6.450% due 09/25/2016 2,334 2,341 8.000% due 12/25/2016 164 170 11.000% due 11/25/2017 919 1,021 9.250% due 04/25/2018 151 163 9.300% due 05/25/2018 614 656 9.500% due 06/25/2018 509 548 6.081% due 06/25/2018 (d) 3 3 6.600% due 09/25/2018 379 378 9.500% due 11/25/2018 5,855 6,066 6.000% due 02/25/2019 3,010 3,018 6.500% due 03/25/2019 818 823 9.500% due 06/25/2019 1,248 1,343 6.350% due 08/25/2019 145 145 9.300% due 08/25/2019 68 73 9.000% due 12/25/2019 5,495 5,804 7.500% due 12/25/2019 68 70 7.000% due 03/25/2020 1,241 1,256 7.000% due 04/25/2020 28 29 7.500% due 05/25/2020 2,809 2,894 6.044% due 07/18/2020 (d) 27 27 6.500% due 09/25/2020 751 751 7.000% due 09/25/2020 8,696 8,738 9.000% due 09/25/2020 2,913 3,095 5.000% due 09/25/2020 200 197 7.125% due 12/25/2020 (d) 4 4 8.000% due 12/25/2020 27,085 28,255 9.000% due 01/25/2021 4,649 4,952 8.750% due 01/25/2021 2,874 3,029 5.750% due 02/18/2021 100 99 9.000% due 03/25/2021 409 433 7.000% due 05/25/2021 300 306 6.500% due 06/25/2021 6,295 6,347 7.500% due 06/25/2021 21 21 8.000% due 07/25/2021 13,648 14,151 8.500% due 09/25/2021 4,817 5,075 7.000% due 10/25/2021 9,647 9,882 8.000% due 10/25/2021 22,645 23,044 7.000% due 11/25/2021 20,052 20,282 6.000% due 12/17/2021 567 567 6.000% due 12/25/2021 24 24 5.000% due 12/25/2021 500 470 4.000% due 01/25/2022 126 121 8.000% due 01/25/2022 21,700 22,213 8.000% due 03/25/2022 49 50 7.000% due 04/25/2022 17,091 17,270 5.000% due 04/25/2022 48 46 7.000% due 04/25/2022 139 139 7.500% due 05/25/2022 2,000 2,083 7.375% due 05/25/2022 9,573 9,800 70 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 7.000% due 06/25/2022 $ 1,164 $ 1,192 8.000% due 06/25/2022 4,018 4,221 8.000% due 07/25/2022 59,758 62,379 7.000% due 07/25/2022 5,064 5,195 7.800% due 10/25/2022 3,024 3,154 6.500% due 10/25/2022 4,181 4,171 6.500% due 12/25/2022 180 181 6.500% due 01/25/2023 1,036 113 7.000% due 03/25/2023 29,916 30,517 6.500% due 05/18/2023 9,153 9,219 6.900% due 05/25/2023 165 163 7.000% due 06/25/2023 5,445 5,296 6.500% due 08/25/2023 35 35 6.000% due 08/25/2023 14,106 13,050 6.500% due 09/18/2023 912 922 6.750% due 09/25/2023 4,107 4,039 1.000% due 09/25/2023 171 158 6.750% due 10/25/2023 618 608 6.500% due 10/25/2023 8,895 8,615 7.500% due 10/25/2023 42 43 6.500% due 11/25/2023 85 85 7.100% due 12/25/2023 6,769 6,762 6.500% due 12/25/2023 159 158 6.500% due 01/25/2024 47,302 45,711 5.000% due 01/25/2024 500 487 7.250% due 02/25/2024 4 4 6.500% due 02/25/2024 5,150 5,182 7.000% due 03/25/2024 5,000 5,098 7.500% due 06/20/2024 85 86 6.500% due 08/17/2024 17,000 16,882 6.000% due 12/25/2024 1,750 1,746 8.000% due 02/17/2025 41 41 7.000% due 02/18/2025 94 95 6.600% due 05/18/2025 219 224 7.500% due 11/17/2025 289 300 7.500% due 12/25/2025 360 371 7.000% due 02/15/2026 180 182 6.950% due 03/25/2026 212 213 7.000% due 07/18/2026 450 450 6.500% due 09/18/2026 120 120 7.000% due 12/18/2026 16,889 16,816 6.000% due 12/25/2026 170 168 8.500% due 02/17/2027 1,403 1,531 6.000% due 03/25/2027 320 316 5.000% due 04/18/2027 1,000 952 6.000% due 05/17/2027 5,470 4,931 6.500% due 07/18/2027 178 170 7.000% due 07/18/2027 460 463 8.000% due 08/18/2027 262 43 7.500% due 08/20/2027 2,598 2,701 7.000% due 12/20/2027 12,735 12,744 7.019% due 04/18/2028 (d) 2,877 2,880 6.500% due 06/25/2028 4,700 4,429 6.500% due 07/18/2028 67,412 65,916 6.000% due 07/18/2028 8,867 7,742 9.113% due 09/25/2028 17,398 19,866 6.500% due 10/25/2028 40,000 39,300 6.250% due 02/25/2029 500 469 7.500% due 04/25/2029 1,240 1,272 6.000% due 04/25/2029 11,137 9,546 7.118% due 08/25/2030 (d) 80,172 80,313 6.030% due 10/18/2030 (d) 63,604 63,695 6.390% due 05/25/2036 30,491 28,228 6.500% due 06/17/2038 5,000 5,037 6.300% due 10/17/2038 15,965 15,110 FBS Mortgage Corp. 7.144% due 11/25/2024 150 150 FFCA Secured Lending Corp. 7.850% due 10/18/2017 29,600 30,791 First Commonwealth Savings & Loan 10.375% due 04/01/2005 15 15 First Horizon Asset Securities, Inc. 7.000% due 02/25/2031 20,818 20,794 First Interstate Bancorp 8.875% due 01/01/2009 (l) 143 152 9.125% due 01/01/2009 (d)(l) 9 9 First Nationwide Trust 6.500% due 03/25/2029 4,400 4,334 6.750% due 07/25/2029 1,515 1,512 7.750% due 07/25/2030 6,157 6,406 First Union Residential Securitization, Inc. 7.000% due 04/25/2025 352 357 6.750% due 08/25/2028 9,048 8,656 First Union-Lehman Brothers Commercial Mortgage 7.150% due 02/18/2004 25 26 Freddie Mac 8.000% due 03/15/2002 70 71 7.500% due 04/15/2003 197 197 6.750% due 10/15/2003 12,774 12,866 7.000% due 10/15/2003 2,970 3,018 7.000% due 12/15/2003 76 78 6.500% due 04/15/2005 917 923 10.150% due 04/15/2006 5 5 6.500% due 07/15/2006 4,864 4,888 6.500% due 08/15/2006 349 350 7.500% due 02/15/2007 739 755 7.750% due 04/01/2007 15 15 7.500% due 04/01/2007 12 13 7.000% due 07/01/2007 2 2 6.500% due 07/15/2007 6,057 6,108 8.000% due 10/01/2007 52 53 5.500% due 10/15/2007 3,039 3,041 6.500% due 05/15/2008 1,000 1,017 2.800% due 06/15/2008 (d) 149 142 6.000% due 11/15/2008 225 227 6.200% due 12/15/2008 4,628 4,631 8.500% due 03/01/2009 131 137 6.000% due 03/15/2009 265 270 11.250% due 10/01/2009 3 3 7.000% due 06/01/2010 14 14 7.550% due 03/15/2012 180 186 11.875% due 06/15/2013 86 94 8.500% due 08/15/2013 2,000 2,064 8.500% due 09/15/2013 5,941 6,069 11.250% due 10/01/2014 67 76 6.000% due 11/15/2014 400 390 6.250% due 11/15/2015 851 852 10.100% due 09/01/2016 237 262 7.500% due 11/15/2016 28,791 29,682 6.250% due 10/15/2017 11,357 11,403 5.900% due 03/15/2018 1,652 1,651 6.350% due 03/25/2018 131 131 5.250% due 05/15/2018 4 4 6.400% due 02/15/2019 10,347 10,399 6.500% due 04/15/2019 1,566 1,578 6.500% due 05/15/2019 77 77 5.800% due 06/15/2019 2,092 2,090 6.250% due 07/15/2019 9,954 9,965 5.000% due 08/15/2019 55 55 10.000% due 11/15/2019 81 86 7.500% due 01/15/2020 1,444 1,448 5.638% due 06/15/2020 (d) 86 86 5.250% due 07/15/2020 216 215 5.750% due 08/15/2020 300 302 9.000% due 09/15/2020 50 52 5.000% due 10/15/2020 968 959 5.500% due 10/15/2020 38 38 9.500% due 11/15/2020 2,902 2,974 8.900% due 11/15/2020 9,925 10,247 9.000% due 12/15/2020 2,628 2,774 8.750% due 12/15/2020 1,254 1,315 6.000% due 12/15/2020 225 223 9.500% due 01/15/2021 1,789 1,893 6.250% due 01/15/2021 200 201 7.000% due 01/15/2021 3,735 3,761 8.000% due 04/15/2021 78 81 6.500% due 05/15/2021 92 93 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 71 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 6.500% due 05/17/2021 $ 49 $ 49 8.500% due 06/15/2021 17,153 17,956 6.000% due 06/15/2021 2,939 2,945 8.500% due 06/15/2021 5,137 5,413 6.950% due 07/15/2021 398 405 9.500% due 07/15/2021 1,014 1,035 8.000% due 07/15/2021 7,102 7,168 9.000% due 07/15/2021 1,868 1,981 6.950% due 08/15/2021 144 146 8.000% due 08/15/2021 23,472 23,945 6.200% due 08/15/2021 878 885 7.000% due 09/15/2021 112 115 6.500% due 09/15/2021 24,998 25,139 4.500% due 09/15/2021 264 255 7.000% due 10/15/2021 7 7 6.000% due 11/15/2021 1,058 1,059 8.000% due 12/15/2021 19,027 19,985 6.850% due 01/15/2022 700 714 8.250% due 06/15/2022 4,697 4,936 7.000% due 07/15/2022 9,699 9,711 8.500% due 10/15/2022 6,502 6,792 7.000% due 12/15/2022 21,000 21,499 7.500% due 01/15/2023 18,415 19,072 6.500% due 02/15/2023 1,250 1,281 7.500% due 05/01/2023 41 42 6.500% due 07/15/2023 240 245 7.000% due 07/15/2023 280 282 6.500% due 07/15/2023 32 32 7.500% due 07/15/2023 395 411 6.500% due 08/15/2023 125,035 126,064 6.850% due 10/25/2023 2,638 2,683 7.400% due 10/25/2023 (d) 13,188 13,646 6.500% due 11/15/2023 139 134 6.500% due 01/15/2024 35 35 7.500% due 01/20/2024 68 69 6.500% due 02/15/2024 20 20 5.000% due 02/15/2024 116 101 6.500% due 03/15/2024 331 322 8.000% due 04/25/2024 491 528 6.250% due 05/15/2024 13,780 13,119 8.500% due 08/01/2024 1,362 1,429 7.250% due 08/15/2024 190 193 8.000% due 09/15/2024 16,250 17,083 8.500% due 11/01/2024 558 586 6.750% due 01/17/2025 6,165 6,208 7.500% due 02/15/2025 3,044 3,092 6.000% due 02/15/2025 4,048 4,066 7.000% due 09/17/2025 40 41 7.000% due 03/01/2026 94 95 6.500% due 03/15/2026 110 108 6.000% due 08/15/2026 2,400 2,347 6.751% due 09/15/2026 (d) 49,153 49,002 8.348% due 10/01/2026 (d) 2,684 2,747 6.000% due 11/15/2026 550 545 7.000% due 01/01/2027 106 108 7.500% due 01/15/2027 26,198 27,277 8.000% due 02/15/2027 35,767 37,658 7.000% due 03/01/2027 133 135 7.500% due 03/17/2027 20,000 20,956 8.527% due 05/01/2027 (d) 508 521 6.750% due 05/15/2027 406 407 6.500% due 06/15/2027 10,499 10,013 7.500% due 06/20/2027 20,314 21,034 6.500% due 08/15/2027 16,157 15,316 6.500% due 09/15/2027 73,000 71,856 6.500% due 10/15/2027 32,300 31,887 6.000% due 11/15/2027 665 654 6.500% due 01/25/2028 8,691 8,511 7.000% due 02/15/2028 1,436 1,440 6.250% due 03/15/2028 10,000 9,555 6.500% due 04/15/2028 159,071 156,370 6.500% due 05/15/2028 51,566 50,355 6.500% due 06/15/2028 63,338 59,238 6.500% due 06/20/2028 24,032 22,687 7.000% due 07/01/2028 696 706 6.500% due 07/15/2028 72,353 66,330 6.500% due 08/15/2028 343,704 318,401 7.000% due 11/15/2028 9,000 9,089 6.000% due 12/01/2028 687 672 6.000% due 12/15/2028 11,442 10,057 6.250% due 12/15/2028 1,726 1,584 6.500% due 12/15/2028 7,289 6,698 6.000% due 12/15/2028 11,995 10,685 6.500% due 01/01/2029 1,461 1,461 6.000% due 01/15/2029 3,415 2,933 6.500% due 01/15/2029 10,411 10,291 6.000% due 02/15/2029 3,990 3,405 6.500% due 03/01/2029 611 611 6.500% due 03/15/2029 26,203 25,100 6.500% due 05/01/2029 894 893 6.500% due 06/01/2029 102 102 6.500% due 07/01/2029 1,045 1,043 8.000% due 07/15/2029 1,250 1,287 7.500% due 02/01/2030 1,129 1,156 7.500% due 07/15/2030 1,000 1,016 7.500% due 08/15/2030 519 528 5.664% due 09/15/2030 14,402 14,468 7.000% due 09/15/2030 (d) 18,634 18,613 7.000% due 10/15/2030 11,702 11,717 7.500% due 10/15/2030 28,215 28,290 5.614% due 11/15/2030 (d) 1,579 1,579 6.947% due 08/15/2032 (d) 32,027 32,821 Gaston Oaks PLC 6.930% due 01/01/2036 2,251 2,237 General Electric Capital Mortgage Services, Inc. 6.000% due 01/25/2009 519 519 7.250% due 07/25/2011 75 75 6.750% due 12/25/2012 2,088 2,106 6.500% due 09/25/2023 1,175 1,096 6.500% due 12/25/2023 8,631 8,020 6.500% due 01/25/2024 3,895 3,571 6.500% due 03/25/2024 67,513 66,553 6.500% due 04/25/2024 68,828 64,342 7.250% due 05/25/2026 3,748 3,810 7.500% due 06/25/2027 19,938 20,423 7.500% due 07/25/2027 10,066 10,331 7.000% due 10/25/2027 14,412 14,429 7.000% due 11/25/2027 72,500 73,736 6.650% due 05/25/2028 5,905 5,954 6.750% due 05/25/2028 23,934 23,988 6.750% due 06/25/2028 1,296 1,296 6.550% due 06/25/2028 23,450 23,905 6.750% due 06/25/2028 20,517 20,416 6.600% due 06/25/2028 5,936 5,987 6.750% due 10/25/2028 12,190 12,119 6.250% due 12/25/2028 54,624 52,461 6.500% due 12/25/2028 19,500 19,041 6.500% due 05/25/2029 9,858 9,566 6.750% due 05/25/2029 20,000 19,819 5.950% due 07/25/2029 24,794 24,788 6.500% due 07/25/2029 95,240 92,011 6.000% due 07/25/2029 23,507 23,577 6.250% due 07/25/2029 132,674 134,144 7.250% due 08/25/2029 8,000 8,106 7.000% due 09/25/2029 16,073 16,182 General Electric Credit Corp. 8.000% due 03/01/2002 (l) 3 3 German American Capital Corp. 4.306% due 07/01/2018 (d) 7,923 7,834 GGP - Homart 7.138% due 06/10/2003 (d) 19,459 19,482 GMAC Commercial Mortgage Asset Corp. 6.919% due 07/20/2002 3,256 3,256 72 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- GMAC Commercial Mortgage Securities, Inc. 6.566% due 11/15/2007 $ 85 $ 87 6.150% due 11/15/2007 254 258 6.700% due 03/15/2008 29,732 30,468 6.974% due 05/15/2008 27,444 28,614 6.945% due 09/15/2033 25,060 26,114 6.570% due 09/15/2033 46,597 47,911 GMAC Mortgage Corp. Loan Trust 7.500% due 05/25/2030 12,000 12,487 Goldman Sachs Mortgage Corp. 6.000% due 12/31/2007 (l) 8,171 8,165 Government National Mortgage Association 6.250% due 06/20/2022 33,961 34,212 7.219% due 06/20/2023 (d) 24,407 24,430 7.250% due 12/16/2023 6,294 6,405 8.000% due 05/16/2024 50 51 7.000% due 06/20/2025 12,138 12,259 7.000% due 03/20/2026 320 327 6.000% due 03/20/2026 1,500 1,500 6.070% due 06/16/2026 (d) 1,378 1,378 7.000% due 08/20/2026 104 106 7.500% due 07/16/2027 30,865 31,835 7.000% due 12/20/2027 18,960 19,026 8.000% due 04/16/2028 4,627 4,638 6.500% due 04/20/2028 11,887 10,962 6.750% due 06/20/2028 22,864 21,468 6.500% due 06/20/2028 31,364 28,982 7.250% due 07/16/2028 30 31 6.500% due 07/20/2028 40,416 36,141 6.500% due 09/20/2028 29,986 28,282 6.500% due 01/20/2029 28,770 26,605 7.000% due 02/16/2029 6,815 7,088 6.500% due 03/20/2029 16,259 15,673 8.000% due 03/20/2029 7,151 7,567 6.000% due 05/20/2029 11,104 9,798 7.000% due 01/16/2030 6,686 6,621 7.500% due 01/20/2030 327 338 5.750% due 02/16/2030 (d) 7,778 7,792 6.383% due 02/16/2030 (d) 12,065 12,126 5.800% due 02/16/2030 (d) 8,418 8,440 7.086% due 06/20/2030 (d) 4,565 4,573 7.119% due 09/20/2030 (d) 11,835 11,804 7.500% due 09/20/2030 5,158 5,273 7.100% due 10/16/2030 (d) 70,053 70,272 Greenwich Capital Acceptance, Inc. 8.305% due 04/25/2022 (d) 314 313 8.325% due 10/25/2022 (d) 34 34 8.441% due 04/25/2023 (d) 676 674 8.935% due 04/25/2024 (d) 459 473 9.716% due 08/25/2024 (d) 356 360 9.687% due 11/25/2024 (d) 33 33 Guardian Savings & Loan Association 7.557% due 09/25/2018 (d) 75 76 Headlands Mortgage Securities, Inc. 7.250% due 11/25/2012 2,089 2,114 7.155% due 12/25/2012 686 697 7.250% due 11/25/2027 18,456 18,759 7.000% due 02/25/2028 410 411 Home Savings of America 8.464% due 08/01/2006 42 43 6.480% due 05/25/2027 (d) 2,455 2,434 6.563% due 08/20/2029 (d) 21,461 21,476 Housing Securities, Inc. 7.000% due 05/25/2008 833 849 HSBC Mortgage Loan Trust 7.110% due 11/16/2030 19,396 19,436 HVMLT 7.470% due 08/19/2030 22,975 23,996 ICI Funding Corp. Secured Assets Corp. 7.250% due 09/25/2027 18,068 18,445 7.750% due 03/25/2028 1,855 1,885 Impac Secured Assets CMN Owner Trust 6.850% due 07/25/2028 58 58 7.318% due 10/25/2030 (d) 54,327 54,639 Imperial CMB Trust 6.650% due 11/25/2029 949 969 Imperial Savings Association 8.230% due 01/25/2017 (d) 54 54 8.839% due 06/25/2017 (d) 206 206 Independent National Mortgage Corp. 8.250% due 05/25/2010 128 131 6.650% due 10/25/2024 2,723 2,738 8.634% due 11/25/2024 (d) 462 465 8.750% due 12/25/2024 30 31 9.232% due 01/25/2025 (d) 75 76 8.000% due 06/25/2025 0 0 8.225% due 07/25/2025 (d) 5,475 5,515 7.500% due 09/25/2025 471 472 6.930% due 05/25/2026 412 412 International Mortgage Acceptance Corp. 12.250% due 03/01/2014 247 286 J.P. Morgan Commercial Mortgage Finance Corp. 8.227% due 02/25/2028 1,615 1,677 7.069% due 09/15/2029 65 68 6.533% due 01/15/2030 20,000 20,510 Kidder Peabody Acceptance Corp. 8.937% due 09/25/2024 (d) 4,245 4,297 LB Commercial Conduit Mortgage Trust 6.330% due 11/18/2004 39 40 LB Mortgage Trust 8.396% due 01/20/2017 (d) 39,862 43,912 Lehman Large Loan 6.790% due 06/12/2004 55 57 LTC Commercial Corp. 7.100% due 11/28/2012 3,140 3,222 Mellon Residential Funding Corp. 6.500% due 02/25/2028 10,000 9,656 6.350% due 06/25/2028 22,000 22,185 5.652% due 06/26/2028 7,426 7,409 6.110% due 01/25/2029 23,900 23,970 6.570% due 07/25/2029 (d) 44,000 44,874 6.580% due 07/25/2029 (d) 55,565 56,238 6.460% due 07/25/2029 (d) 4,622 4,634 Merrill Lynch Mortgage Investors, Inc. 6.861% due 06/15/2021 1,982 2,020 6.978% due 06/15/2021 (d) 4,370 4,476 7.238% due 06/15/2021 (d) 4,099 4,194 7.598% due 06/15/2021 (d) 910 921 6.950% due 06/18/2029 34,041 35,062 5.650% due 12/15/2030 7,590 7,612 Midland Realty Acceptance Corp. 7.020% due 01/25/2029 12,112 12,400 MLCC Mortgage Investors, Inc. 6.875% due 09/15/2026 (d) 17,183 17,201 Morgan Stanley Capital I 6.440% due 11/15/2002 18 18 5.990% due 03/15/2005 54 55 6.860% due 05/15/2006 (d) 1,910 1,971 6.190% due 01/15/2007 19,529 19,879 6.160% due 04/03/2009 12,840 13,018 7.460% due 02/15/2020 10,542 11,073 6.850% due 07/25/2027 (d) 417 415 6.220% due 06/01/2030 68 69 6.590% due 10/03/2030 6,485 6,674 Mortgage Capital Funding, Inc. 7.800% due 04/15/2006 500 540 7.008% due 09/20/2006 15,545 16,161 7.600% due 05/25/2027 3,894 3,943 6.001% due 11/18/2031 69 70 NationsBanc Montgomery Funding Corp. 6.750% due 06/25/2028 10,000 9,926 6.500% due 07/25/2028 14,470 14,255 6.750% due 08/25/2028 20,009 19,535 6.250% due 10/25/2028 7,000 6,659 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 73 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Nationslink Funding Corp. 6.654% due 02/10/2006 $ 19,624 $ 20,248 5.921% due 04/10/2007 (d) 20,192 20,195 5.805% due 11/10/2030 7,174 7,175 Nomura Asset Securities Corp. 6.625% due 01/25/2009 19 19 8.105% due 05/25/2024 (d) 1,050 1,076 Norwest Asset Securities Corp. 6.750% due 12/25/2012 15,113 15,485 6.500% due 04/25/2013 19,557 19,750 6.500% due 06/25/2013 12,972 13,099 7.500% due 03/25/2027 41,558 42,684 6.750% due 09/25/2027 2,612 2,637 6.350% due 04/25/2028 1,084 1,085 6.750% due 05/25/2028 40,707 40,414 6.750% due 07/25/2028 12,657 12,578 6.250% due 08/25/2028 3,245 3,256 6.250% due 09/25/2028 400 383 6.200% due 09/25/2028 744 744 6.750% due 10/25/2028 38,104 37,906 6.500% due 12/25/2028 39,751 39,015 6.500% due 01/25/2029 385 346 6.500% due 02/25/2029 67,432 65,324 6.200% due 04/25/2029 77,385 77,159 6.500% due 04/25/2029 26,751 25,925 6.300% due 04/25/2029 6,847 6,855 5.950% due 04/25/2029 97,464 97,367 6.000% due 05/25/2029 19,713 19,772 6.250% due 05/25/2029 472 476 6.500% due 06/25/2029 46,178 44,631 6.750% due 08/25/2029 1,103 1,112 6.500% due 10/25/2029 1,969 1,905 7.000% due 11/25/2029 14,793 14,946 7.250% due 02/25/2030 19,756 20,095 Norwest Integrated Structured Assets, Inc. 7.000% due 09/25/2029 3,574 3,536 Paine Webber Mortgage Acceptance Corp. 6.000% due 04/25/2009 11,951 11,852 PHH Mortgage Services Corp. 7.184% due 11/18/2027 948 951 PNC Mortgage Securities Corp. 6.750% due 06/25/2016 8,897 8,960 7.000% due 10/25/2027 35,815 36,299 6.750% due 12/25/2027 7,230 6,929 6.990% due 02/25/2028 9,494 9,776 6.500% due 02/25/2028 850 849 7.000% due 02/25/2028 25,470 25,805 6.625% due 03/25/2028 1,561 1,572 7.000% due 05/25/2028 5,664 5,753 6.750% due 07/25/2028 3,527 3,509 6.550% due 07/25/2028 24,500 24,707 6.750% due 09/25/2028 3,996 3,974 6.750% due 10/25/2028 26,045 25,987 6.750% due 12/25/2028 21,709 21,443 6.500% due 01/25/2029 999 975 6.250% due 01/25/2029 9,263 8,991 6.300% due 03/25/2029 9,989 9,505 6.200% due 06/25/2029 46,288 46,757 6.500% due 06/25/2029 48,600 46,862 7.750% due 07/25/2030 67,726 69,530 6.013% due 12/25/2030 (d) 35,452 35,519 7.500% due 02/25/2031 88,982 92,271 7.500% due 05/25/2040 (d) 444 451 PNC Mortgage Trust 8.250% due 03/25/2030 58,189 59,980 Prudential Home Mortgage Securities 7.400% due 11/25/2007 1,416 1,443 7.000% due 01/25/2008 23,860 24,270 6.750% due 07/25/2008 1,256 1,268 6.400% due 04/25/2009 330 329 6.950% due 11/25/2022 222 219 7.000% due 07/25/2023 10,270 10,431 6.750% due 10/25/2023 9,940 9,261 5.900% due 12/25/2023 3,376 3,382 6.500% due 01/25/2024 617 619 6.050% due 04/25/2024 1,959 1,957 6.800% due 05/25/2024 11,349 10,985 6.450% due 11/25/2025 5,264 4,959 Prudential Securities Secured Financing Corp. 6.074% due 01/15/2008 11,965 12,107 Prudential-Bache Trust 6.676% due 09/01/2018 (d) 195 196 8.400% due 03/20/2021 5,367 5,614 PSB Financial Corp. II 11.050% due 12/01/2015 405 429 Resecuritization Mortgage Trust 6.750% due 06/19/2028 18,121 18,155 6.500% due 04/19/2029 3,764 3,824 Residential Accredit Loans, Inc. 7.500% due 08/25/2027 15,000 15,394 6.500% due 02/25/2028 11,531 11,518 7.000% due 02/25/2028 41,115 41,869 6.500% due 12/25/2028 400 391 6.500% due 05/25/2029 3,000 2,925 6.750% due 06/25/2029 1,464 1,478 7.000% due 07/25/2029 418 422 7.750% due 03/25/2030 3,389 3,431 Residential Asset Securitization Trust 7.375% due 03/25/2027 5,142 5,267 7.000% due 10/25/2027 19,360 19,763 7.000% due 01/25/2028 20,000 20,225 6.750% due 06/25/2028 13,193 13,307 6.500% due 12/25/2028 1,250 1,237 6.500% due 03/25/2029 22,700 22,629 8.000% due 02/25/2030 43,760 45,111 7.320% due 09/25/2030 (d) 15,052 15,159 Residential Funding Mortgage Securities I 7.000% due 08/25/2008 3,902 3,922 7.500% due 09/25/2011 12,122 12,355 7.000% due 05/25/2012 3,095 3,197 6.500% due 12/25/2012 20,123 20,124 7.750% due 09/25/2022 391 393 8.000% due 01/25/2023 2,615 2,655 8.000% due 02/25/2023 9,225 9,403 6.500% due 11/25/2023 1,660 1,601 6.000% due 03/25/2024 392 391 7.500% due 09/25/2025 9,892 9,973 7.500% due 12/25/2025 937 971 7.750% due 11/25/2026 9,000 9,366 7.500% due 04/25/2027 6,085 6,229 7.500% due 06/25/2027 53,035 54,222 7.500% due 07/25/2027 25,265 26,042 7.250% due 08/25/2027 16,000 16,134 7.250% due 10/25/2027 39,303 39,700 7.000% due 11/25/2027 17,000 17,262 6.750% due 02/25/2028 32,196 32,342 6.750% due 05/25/2028 60,741 60,780 6.750% due 06/25/2028 67,908 66,989 6.750% due 07/25/2028 13,292 13,228 6.750% due 08/25/2028 35,000 34,836 6.750% due 09/25/2028 66,493 66,027 6.500% due 10/25/2028 52,000 50,794 6.250% due 11/25/2028 3,000 2,878 6.500% due 12/25/2028 23,400 22,784 6.500% due 01/25/2029 72,314 70,451 6.500% due 03/25/2029 27,960 27,184 6.200% due 05/25/2029 46,610 46,622 6.500% due 06/25/2029 11,708 10,347 6.750% due 07/25/2029 22,600 22,573 7.000% due 10/25/2029 25,260 25,415 7.500% due 02/25/2030 12,338 12,704 7.750% due 10/25/2030 26,572 27,237 7.500% due 11/25/2030 183,575 187,754 Resolution Trust Corp. 8.686% due 08/25/2021 6,075 6,057 11.062% due 10/25/2021 46 48 8.625% due 10/25/2021 115 114 8.138% due 10/25/2021 (d) 123 122 5.567% due 10/25/2021 (d) 127 127 8.720% due 05/25/2022 (d) 1,211 1,207 74 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 8.640% due 08/25/2023 (d) $ 1,733 $ 1,754 8.835% due 12/25/2023 3,300 3,368 8.000% due 04/25/2025 156 155 8.000% due 06/25/2026 249 246 8.427% due 10/25/2028 (d) 4,388 4,466 7.596% due 10/25/2028 (d) 12,343 12,404 7.510% due 05/25/2029 (d) 2,266 2,322 7.245% due 05/25/2029 (d) 2,486 2,504 6.923% due 05/25/2029 (d) 2,865 2,867 RMF Commercial Mortgage Securities, Inc. 6.715% due 01/15/2019 (d) 235 241 Ryan Mortgage Acceptance Corp. IV 9.450% due 10/01/2016 73 78 Ryland Acceptance Corp. 11.500% due 12/25/2016 80 86 8.200% due 09/25/2022 11 11 Ryland Mortgage Securities Corp. 8.200% due 06/25/2021 34 34 8.518% due 08/25/2022 (d) 1,587 1,602 8.108% due 08/25/2029 (d) 1,762 1,769 7.402% due 10/25/2031 (d) 2,085 2,102 14.000% due 11/25/2031 684 731 SACO I, Inc. 7.460% due 07/25/2030 506 506 8.128% due 07/25/2030 15,241 15,769 6.140% due 09/25/2040 (d) 546 546 Salomon Brothers Mortgage Securities VII 8.613% due 09/25/2022 (d) 746 752 8.565% due 11/25/2022 (d) 382 387 8.950% due 03/25/2024 (d) 287 293 9.240% due 07/01/2024 (d) 3,732 3,790 9.307% due 09/25/2024 (d) 266 272 6.960% due 04/25/2029 (d) 14,057 14,094 5.430% due 04/25/2029 (d) 5,444 5,463 6.918% due 06/25/2029 (d) 34,211 34,195 7.600% due 08/25/2030 125,500 128,143 Santa Barbara Savings & Loan Association 9.500% due 11/20/2018 1,792 1,847 Sasco Floating Rate Commercial Mortgage Trust 5.408% due 11/20/2001 (d) 36,906 36,938 Saxon Mortgage Securities Corp. 6.250% due 04/25/2009 2,032 2,039 7.375% due 09/25/2023 6,372 6,498 6.500% due 02/25/2024 1,517 1,525 9.154% due 09/25/2024 (d) 1,267 1,278 Sears Mortgage Securities 12.000% due 02/25/2014 534 556 7.896% due 11/25/2021 (d) 449 455 7.431% due 10/25/2022 (d) 1,538 1,555 6.278% due 12/25/2028 254 253 Securitized Asset Sales, Inc. 8.543% due 12/26/2023 (d) 620 647 7.410% due 09/25/2024 (d) 9,900 10,078 Security Pacific National Bank 6.378% due 03/25/2018 (d) 81 81 7.156% due 09/25/2019 (d) 462 463 Sequoia Mortgage Trust 6.350% due 09/25/2025 (d) 5,343 5,396 Small Business Investment Cos 7.540% due 08/10/2009 93,532 99,276 8.017% due 02/10/2010 115,208 125,258 7.640% due 03/10/2010 69,504 73,960 7.452% due 09/01/2010 15,860 16,698 Starwood Commercial Mortgage Trust 6.600% due 02/03/2009 11,041 11,389 Structured Asset Mortgage Investments, Inc. 6.750% due 03/25/2028 22,356 22,065 6.902% due 06/25/2028 (d) 35,851 37,373 6.250% due 11/25/2028 14,878 14,219 6.750% due 01/25/2029 10,000 9,916 6.300% due 05/25/2029 21,870 21,958 6.581% due 06/25/2029 (d) 29,054 29,515 7.250% due 07/25/2029 19,588 19,812 7.226% due 02/25/2030 (d) 908 931 6.750% due 05/02/2030 25,000 24,035 Structured Asset Notes Transactions Ltd. 6.650% due 08/30/2005 (d) 16,364 16,241 Structured Asset Securities Corp. 7.000% due 02/25/2016 30,002 30,587 7.000% due 12/25/2027 51,500 52,079 7.220% due 11/25/2030 (d) 38,908 38,774 Superannuation Members Home Loans Global Fund 6.835% due 06/15/2026 (d) 19,900 19,900 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 30,145 30,145 Torrens Trust 5.424% due 07/15/2031 (d) 3,593 3,593 Union Planters Mortgage Finance Corp. 6.750% due 01/25/2028 4,000 3,969 6.800% due 01/25/2028 15,000 15,226 United Mortgage Securities Corp. 7.302% due 06/25/2032 18,991 19,194 7.108% due 09/25/2033 (d) 393 406 Vendee Mortgage Trust 7.500% due 08/15/2017 229 232 7.750% due 05/15/2018 550 561 6.500% due 05/15/2020 29,697 29,460 7.750% due 05/15/2022 303 319 6.835% due 01/15/2030 15,952 16,345 Washington Mutual, Inc. 5.690% due 07/26/2003 (d) 109,938 109,905 7.500% due 11/19/2029 600 618 7.608% due 12/25/2040 37,551 37,657 7.175% due 01/25/2041 112,469 115,949 Wells Fargo Mortgage Backed Securities Trust 7.500% due 01/25/2031 5,094 5,049 Western Federal Savings & Loan Association 7.997% due 06/25/2021 (d) 2,561 2,565 ------------- 10,689,693 ------------- Fannie Mae 7.1% 5.500% due 01/01/2004-01/01/2031 (k) 20,723 19,717 6.000% due 11/01/2003-04/16/2031 (k) 1,013,468 988,527 6.090% due 12/01/2008 49 49 6.210% due 08/01/2010-04/01/2027 (d)(k) 50,969 51,573 6.255% due 09/01/2013 64,000 64,168 6.258% due 09/01/2029 (d) 587 595 6.420% due 12/01/2007 150 155 6.500% due 04/01/2003-03/01/2031 (k) 20,264 20,362 6.550% due 01/01/2008 950 986 6.570% due 04/01/2026 (d) 1,093 1,128 6.626% due 12/01/2027 (d) 7,508 7,775 6.688% due 08/01/2027 (d) 35,083 35,996 6.726% due 05/01/2030 (d) 253 255 6.730% due 11/01/2007 1,138 1,191 6.739% due 09/01/2017 (d) 5,229 5,224 6.750% due 08/01/2003 164 165 6.840% due 09/01/2024 (d) 1,869 1,900 6.847% due 07/01/2003 61 62 6.961% due 01/01/2018 (d) 1,046 1,068 6.969% due 10/01/2027 (d) 4,022 4,154 6.981% due 06/01/2007 462 486 7.000% due 07/01/2001-05/15/2031 (k) 1,369,639 1,384,885 7.250% due 05/01/2002-01/01/2023 (k) 9,520 9,595 7.350% due 09/01/2027 (d) 1,555 1,618 7.364% due 02/01/2028 (d) 1,139 1,180 7.468% due 06/01/2030 (d) 41,866 44,208 7.500% due 10/01/2002-10/01/2030 (k) 19,040 19,685 7.508% due 10/01/2030-10/01/2040 (d)(k) 31,856 32,791 7.552% due 05/01/2023 (d) 2,062 2,127 7.750% due 06/01/2009 149 154 7.780% due 01/01/2018 2,230 2,518 7.850% due 07/01/2018 6,699 7,425 7.920% due 03/01/2018 2,745 3,137 7.980% due 05/01/2030 6,678 6,990 8.000% due 09/01/2001-04/16/2031 (k) 188,605 194,508 8.039% due 05/01/2025 (d) 2,273 2,334 8.060% due 04/01/2030 1,854 1,947 8.079% due 09/01/2022 (d) 911 936 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 75 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 8.080% due 04/01/2030 $ 1,015 $ 1,066 8.095% due 06/01/2023 (d) 1,851 1,907 8.097% due 12/01/2023 (d) 678 695 8.108% due 10/01/2024 (d) 263 269 8.189% due 09/01/2024 (d) 1,211 1,231 8.211% due 12/01/2023 (d) 769 782 8.230% due 11/01/2025 (d) 1,140 1,170 8.235% due 03/01/2025-11/01/2025 (d)(k) 4,395 4,518 8.250% due 10/01/2008-03/01/2030 (k) 2,194 2,431 8.276% due 08/01/2027 (d) 939 970 8.291% due 01/01/2024-07/01/2024 (d)(k) 4,347 4,453 8.315% due 01/01/2024 (d) 358 369 8.318% due 02/01/2026 (d) 466 483 8.344% due 11/01/2023 (d) 758 779 8.347% due 09/01/2025 (d) 1,184 1,216 8.348% due 11/01/2025 (d) 3,033 3,114 8.362% due 01/01/2024 (d) 1,604 1,654 8.364% due 10/01/2024 (d) 1,343 1,389 8.374% due 03/01/2026 (d) 1,629 1,695 8.380% due 09/01/2022 (d) 948 972 8.389% due 08/01/2026 (d) 1,630 1,684 8.396% due 01/01/2026 (d) 1,044 1,078 8.405% due 12/01/2023 (d) 163 168 8.410% due 09/01/2023 (d) 2,195 2,238 8.418% due 06/01/2024 (d) 1,219 1,247 8.446% due 10/01/2023 (d) 304 314 8.450% due 11/01/2023 (d) 164 170 8.451% due 05/01/2026 (d) 501 514 8.472% due 01/01/2024 (d) 111 115 8.490% due 06/01/2025 992 1,047 8.494% due 12/01/2023 (d) 1,017 1,051 8.500% due 07/01/2001-09/01/2030 (k) 6,923 7,241 8.574% due 05/01/2024 (d) 1,970 2,012 8.903% due 08/01/2023 (d) 518 539 9.000% due 10/01/2004-12/01/2027 (k) 8,542 9,056 9.250% due 10/01/2001 1 1 9.500% due 12/01/2006-07/01/2026 (k) 8,569 9,017 9.750% due 11/01/2008 49 53 10.000% due 09/01/2003-05/01/2022 (k) 1,106 1,208 10.500% due 01/01/2016-04/01/2022 (k) 480 532 10.750% due 03/01/2014 24 26 11.000% due 09/01/2019-11/01/2020 (k) 113 127 11.500% due 08/20/2016-11/01/2019 (k) 72 81 12.000% due 05/01/2016 8 10 12.500% due 10/01/2015 27 31 13.000% due 09/01/2013 27 32 13.250% due 09/01/2011 11 13 14.500% due 11/01/2011-01/01/2013 (k) 36 42 14.750% due 08/01/2012 146 175 15.000% due 10/01/2012 77 93 15.500% due 10/01/2012-12/01/2012 (k) 16 18 15.750% due 12/01/2011-08/01/2012 (k) 86 103 16.000% due 09/01/2012 99 117 ------------- 2,992,890 ------------- Federal Housing Administration 1.2% 6.000% due 03/20/2028 4,598 4,490 6.500% due 05/28/2039 5 5 6.750% due 07/15/2001 1,444 1,451 6.755% due 03/01/2041 16,213 16,129 6.780% due 07/25/2040 7,658 7,553 6.790% due 05/01/2039 10,902 10,123 6.830% due 12/01/2039 3,497 3,460 6.875% due 11/01/2015 3,153 3,057 6.880% due 10/25/2040-02/01/2041 (k) 21,722 21,571 6.896% due 07/01/2020 22,087 21,254 6.900% due 12/01/2040 22,769 22,643 6.930% due 07/01/2014-01/01/2036 (k) 20,005 19,892 7.000% due 11/15/2040 63 65 7.050% due 03/25/2040 4,517 4,541 7.125% due 03/01/2034 4,401 4,265 7.150% due 01/25/2029 9,573 9,295 7.211% due 12/01/2021 2,695 2,649 7.250% due 06/01/2040 8,304 8,437 7.310% due 06/01/2041 23,566 24,048 7.315% due 08/01/2019 32,306 32,024 7.317% due 05/01/2019 4,725 4,621 7.350% due 11/01/2020-11/01/2022 (k) 9,945 9,882 7.375% due 02/01/2018-01/01/2024 (k) 16,436 16,332 7.400% due 01/25/2020-02/01/2021 (k) 12,034 11,995 7.430% due 12/01/2016-05/01/2025 (k) 135,778 135,600 7.450% due 12/01/2021-10/01/2023 (k) 15,942 15,905 7.460% due 01/01/2023 2,137 2,136 7.465% due 11/01/2019 29,537 29,528 7.500% due 03/01/2032-09/30/2039 (k) 4,890 4,981 7.580% due 12/01/2040 7,616 7,834 7.630% due 08/01/2041 20,577 21,178 7.650% due 11/01/2018-11/01/2040 (k) 7,559 7,869 7.700% due 03/15/2041 350 370 7.750% due 11/15/2039 978 1,037 7.880% due 12/01/2039-03/01/2041 (k) 13,423 14,078 7.930% due 05/01/2016 1,877 1,909 8.250% due 10/29/2023-01/01/2041 (k) 9,484 9,999 8.378% due 11/07/2012 244 253 ------------- 512,459 ------------- Freddie Mac 1.6% 5.500% due 04/01/2001-04/16/2031 (k) 3,845 3,727 6.000% due 01/01/2011-05/14/2031 (k) 20,510 20,518 6.263% due 12/01/2026 (d) 5,522 5,552 6.500% due 07/01/2001-05/01/2029 (k) 8,801 8,950 6.553% due 11/01/2026 (d) 6,055 6,146 6.732% due 11/01/2028 (d) 20,764 21,238 6.775% due 11/01/2003 63 62 6.903% due 07/01/2025 (d) 5,803 5,959 7.000% due 10/01/2002-05/14/2031 (k) 390,901 395,710 7.250% due 11/01/2008 175 178 7.285% due 09/01/2027 (d) 2,449 2,534 7.500% due 09/01/2001-03/01/2030 (k) 14,822 15,147 7.625% due 06/01/2017 (d) 17 17 7.645% due 05/01/2025 2,374 2,537 7.750% due 04/01/2017 (d) 29 29 7.812% due 07/01/2030 (d) 127,169 133,327 8.000% due 01/01/2002-09/01/2018 (k) 3,511 3,631 8.142% due 04/01/2024 (d) 5,790 5,944 8.250% due 12/01/2002-01/01/2019 (d)(k) 218 224 8.252% due 07/01/2022 (d) 587 598 8.276% due 08/01/2023 (d) 7 7 8.346% due 06/01/2022 (d) 1,006 1,023 8.362% due 06/01/2024 (d) 2,520 2,590 8.364% due 07/01/2023 (d) 452 459 8.365% due 11/01/2023 (d) 96 99 8.368% due 10/01/2023 (d) 729 748 8.375% due 06/01/2024 (d) 1,473 1,509 8.376% due 10/01/2023 (d) 1,339 1,373 8.380% due 09/01/2023 (d) 7,900 8,045 8.390% due 08/01/2023 (d) 7,857 8,084 8.396% due 09/01/2023 (d) 1,142 1,171 8.423% due 04/01/2029 (d) 1,094 1,128 8.424% due 05/01/2023 (d) 650 662 8.434% due 07/01/2023 (d) 1,461 1,475 8.435% due 05/01/2023-08/01/2023 (d)(k) 5,320 5,419 8.445% due 08/01/2023 (d) 835 848 8.451% due 01/01/2024 (d) 398 410 8.458% due 07/01/2024 (d) 1,257 1,291 8.500% due 09/01/2001-06/01/2030 (k) 3,567 3,728 8.545% due 08/01/2024 (d) 167 172 8.567% due 05/01/2023 (d) 1,582 1,621 8.575% due 01/01/2024 (d) 348 360 8.584% due 09/01/2023 (d) 2,072 2,113 8.626% due 08/01/2023 (d) 315 318 8.651% due 09/01/2023 (d) 1,032 1,036 8.665% due 12/01/2023 (d) 1,068 1,105 8.667% due 10/01/2023 (d) 1,298 1,334 8.670% due 04/01/2023 (d) 321 329 8.750% due 01/01/2007-12/01/2010 (k) 57 60 8.834% due 11/01/2023 (d) 345 346 8.937% due 10/01/2023 (d) 267 269 8.980% due 11/01/2023 (d) 142 141 9.000% due 01/01/2002-05/01/2017 (k) 407 424 9.006% due 10/01/2023 (d) 954 962 76 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 9.111% due 11/01/2023 (d) $ 258 $ 260 9.250% due 06/01/2009-11/01/2013 (k) 70 73 9.500% due 08/01/2001-12/01/2022 (k) 1,286 1,352 9.750% due 11/01/2004-05/01/2009 (k) 35 36 10.000% due 06/01/2004-03/01/2021 (k) 762 810 10.250% due 04/01/2009-05/01/2009 (k) 991 1,086 10.500% due 10/01/2017-01/01/2021 (k) 345 385 10.750% due 09/01/2010 34 38 11.000% due 11/01/2009-05/01/2020 (k) 570 634 11.250% due 10/01/2009-09/01/2015 (k) 20 22 11.500% due 01/01/2018 63 70 12.500% due 12/01/2012 15 17 13.250% due 10/01/2013 79 93 14.000% due 04/01/2016 15 18 15.500% due 08/01/2011-11/01/2011 (k) 12 15 16.250% due 05/01/2011 3 3 ------------- 687,599 ------------- Government National Mortgage Association 41.7% 5.000% due 06/20/2022-06/20/2026 (d)(k) 974 989 5.500% due 06/20/2026-04/23/2031 (d)(k) 21,909 20,932 5.650% due 10/15/2012 11 10 6.000% due 10/15/2008-04/23/2031 (d)(k) 2,727,913 2,684,181 6.375% due 05/20/2026-05/20/2027 (d)(k) 3,457 3,507 6.500% due 10/15/2008-09/15/2040 (d)(k) 8,375,660 8,373,036 6.625% due 01/15/2040 9,588 9,720 6.670% due 10/15/2001-07/16/2038 (k) 961 958 6.750% due 07/15/2001-07/20/2024 (d)(k) 18,347 18,466 6.800% due 05/15/2040 2,988 2,963 6.820% due 04/15/2040 16,932 16,804 6.875% due 02/20/2016-02/15/2040 (d)(k) 1,171 1,200 7.000% due 10/15/2001-01/03/2041 (d)(k) 5,059,234 5,134,389 7.125% due 10/20/2019-11/20/2027 (d)(k) 35,952 36,851 7.250% due 08/20/2024 (d) 281 286 7.375% due 05/20/2017-05/20/2028 (d)(k) 514,296 522,113 7.500% due 01/15/2003-01/15/2031 (k) 127,981 131,280 7.625% due 12/20/2017-12/20/2027 (d)(k) 306,342 314,014 7.700% due 02/15/2002 6,403 6,764 7.750% due 07/15/2001-09/20/2027 (d)(k) 359,978 368,770 7.875% due 04/20/2023 (d) 270 275 8.000% due 08/15/2005-09/15/2030 (k) 12,494 12,930 8.125% due 07/15/2001-12/01/2039 (k) 3,680 3,994 8.250% due 08/15/2004-08/20/2027 (d)(k) 1,178 1,227 8.500% due 06/15/2001-04/23/2031 (k) 8,672 8,985 8.750% due 03/15/2007-07/15/2007 (k) 87 92 9.000% due 06/15/2001-07/20/2022 (k) 5,286 5,640 9.250% due 07/15/2003-12/20/2016 (k) 137 144 9.500% due 12/15/2003-08/15/2023 (k) 4,093 4,424 9.750% due 09/15/2002-07/15/2004 (k) 67 70 10.000% due 08/20/2004-02/15/2025 (k) 4,771 5,261 10.250% due 02/20/2019 22 24 10.500% due 06/15/2004-09/15/2021 (k) 614 668 11.000% due 05/15/2004-03/15/2019 (k) 181 199 11.250% due 12/20/2015 33 36 11.500% due 10/15/2010-10/15/2015 (k) 85 94 12.000% due 11/15/2012-05/15/2016 (k) 205 238 12.500% due 01/15/2011 1 1 13.000% due 12/15/2012-10/15/2014 (k) 16 20 13.250% due 10/20/2014 19 22 13.500% due 10/15/2012-09/15/2014 (k) 72 84 15.000% due 02/15/2012-10/15/2012 (k) 92 110 16.000% due 10/15/2011-05/15/2012 (k) 191 231 17.000% due 11/15/2011-12/15/2011 (k) 58 68 ------------- 17,692,070 ------------- Stripped Mortgage-Backed Securities 0.0% Bear Stearns Mortgage Securities, Inc. (IO) 7.200% due 07/25/2024 257 14 Chase Mortgage Finance Corp. (IO) 9.000% due 08/25/2023 142 2 Collateralized Mortgage Obligation Trust (PO) 0.000% due 04/23/2017 11 9 Fannie Mae (IO) 6.500% due 05/25/2005 574 48 6.500% due 07/25/2006 248 6 727.220% due 09/25/2006 2 6 6.500% due 02/25/2007 771 30 6.500% due 07/25/2007 137 4 6.500% due 09/25/2007 1,025 45 6.500% due 10/25/2007 281 12 0.100% due 03/25/2009 (d) 20,167 319 6.500% due 08/25/2020 2,064 114 1007.000% due 01/25/2021 0 1 7.500% due 04/25/2021 1,308 153 903.213% due 08/25/2021 5 114 0.950% due 11/25/2021 (d) 19,264 270 6.500% due 10/25/2022 90 8 6.500% due 01/25/2023 2,441 355 3.663% due 02/25/2023 (d) 10,735 715 Fannie Mae (PO) 0.000% due 09/01/2007 588 527 0.000% due 06/25/2022 110 109 0.000% due 08/25/2023 295 241 Freddie Mac (IO) 5.750% due 09/15/2007 (d) 4,517 334 6.000% due 10/15/2007 138 8 6.000% due 01/15/2008 49 2 5.428% due 02/15/2008 (d) 466 31 7.000% due 08/15/2008 2,633 263 6.400% due 10/15/2008 42 5 7.000% due 04/15/2018 414 7 6.500% due 10/15/2018 266 8 8.845% due 01/15/2021 2 23 9.000% due 05/15/2022 85 15 6.500% due 09/15/2023 231 26 Paine Webber CMO Trust (IO) 1359.500% due 08/01/2019 1 27 Vendee Mortgage Trust (IO) 0.542% due 06/15/2023 (d) 141,532 2,541 ------------- 6,392 ------------- Total Mortgage-Backed Securities 32,581,103 (Cost $32,294,094) ------------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 6.7% -------------------------------------------------------------------------------- Aames Mortgage Trust 5.524% due 06/15/2027 437 436 7.119% due 11/25/2030 (d) 43,424 43,537 ABFS Equipment Contract Trust 6.100% due 10/15/2005 54 53 ABSC Long Beach Home Equity Loan Trust 6.436% due 07/21/2030 (d) 375 377 6.096% due 08/21/2030 (d) 127,449 127,589 Accredited Mortgage Loan Trust 5.850% due 02/25/2030 (d) 45,106 45,206 Ace Securities Corp. 6.940% due 11/25/2028 (d) 1,230 1,233 Advanta Mortgage Loan Trust 5.263% due 05/25/2027 (d) 667 664 6.114% due 08/25/2029 (d) 2,307 2,316 5.425% due 11/25/2029 (d) 1,586 1,588 8.250% due 08/25/2030 7,954 8,371 Advanta Revolving Home Equity Loan Trust 6.988% due 01/25/2024 (d) 22,049 22,123 6.868% due 08/25/2024 (d) 20,049 20,047 6.898% due 02/25/2025 (d) 12,535 12,544 Aerco Ltd. 7.089% due 07/15/2025 (d) 38,200 38,258 AESOP Funding II LLC 5.830% due 11/20/2006 (d) 15,500 15,418 AFC Home Equity Loan Trust 7.808% due 10/25/2026 (d) 3 3 American Express Credit Account Master Trust 6.800% due 12/15/2003 1,500 1,505 American Express Master Trust 7.850% due 08/15/2005 220 237 American Stores Co. 6.899% due 08/30/2004 20,000 19,776 Americredit Automobile Receivable Trust 5.304% due 10/12/2002 1,913 1,915 5.780% due 05/12/2003 43,000 43,222 5.443% due 09/05/2006 (d) 5,000 5,017 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 77 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Ameriquest Mortgage Securities, Inc. 5.889% due 06/15/2030 $ 12,168 $ 12,196 Amresco Residential Securities Mortgage Loan Trust 6.775% due 05/25/2028 (d) 1,661 1,662 Arcadia Automobile Receivables Trust 6.250% due 09/15/2002 4,773 4,781 6.300% due 07/15/2003 25,821 25,982 6.900% due 12/15/2003 20,519 20,838 Associates Manufactured Housing 7.000% due 03/15/2027 1,492 1,499 Banc One Heloc Trust 6.880% due 04/20/2020 (d) 38,373 38,390 Banc One Home Equity Trust 6.460% due 06/25/2029 2,333 2,327 BankBoston Home Equity Loan Trust 6.280% due 11/25/2010 6 6 Bayview Financial Acquisition Trust 7.170% due 02/25/2029 (d) 4,308 4,328 6.130% due 11/25/2029 (d) 10,626 10,626 7.002% due 02/25/2030 (d) 20,512 20,519 5.920% due 07/25/2030 (d) 61,806 61,806 5.920% due 11/25/2030 (d) 42,300 42,300 BMCA Receivables Master Trust 6.840% due 09/20/2002 (d) 12,000 11,993 Brazos Student Loan Finance Co. 6.190% due 06/01/2023 (d) 55,700 55,576 7.170% due 12/01/2025 (d) 36,780 36,554 Capital Asset Research Funding LP 6.400% due 12/15/2004 207 210 5.905% due 12/15/2005 125 125 Captec Franchise Trust 7.892% due 10/15/2010 1,291 1,344 Champion Home Equity Loan Trust 6.908% due 03/25/2029 (d) 4,285 4,285 5.930% due 09/25/2029 13,214 13,238 Charming Shoppes Master Trust 7.069% due 08/15/2008 (d) 250 251 Chase Credit Card Master Trust 6.660% due 01/15/2007 645 674 Chase Funding Mortgage Loan Asset-Backed Certificates 6.840% due 10/25/2030 (d) 54,966 54,963 Chase Manhattan Grantor Trust 6.610% due 09/15/2002 214 215 Community Program Loan Trust 4.500% due 10/01/2018 23,416 22,120 4.500% due 04/01/2029 26,000 21,474 Compucredit Credit Card Master Trust 5.789% due 03/15/2007 (d) 16,000 16,000 Conseco Finance 7.520% due 05/15/2014 23,994 24,286 7.800% due 05/15/2020 175 185 5.534% due 10/15/2031 (d) 27,148 27,244 Conseco Finance Home Loan Trust 6.980% due 06/15/2011 12,305 12,409 8.080% due 02/15/2022 20,300 21,326 Conseco Finance Lease LLC 7.250% due 04/20/2003 25,500 25,772 Conseco Finance Securitizations Corp. 8.850% due 12/01/2030 20,000 22,451 7.180% due 05/01/2032 18,072 18,303 7.970% due 05/01/2032 25,600 26,956 8.310% due 05/01/2032 48,800 52,721 Contimortgage Home Equity Loan Trust 6.420% due 04/25/2014 63 63 6.400% due 06/15/2014 489 489 6.770% due 01/25/2018 41,700 42,221 6.990% due 03/15/2021 350 356 6.930% due 11/25/2022 36,800 37,783 7.220% due 01/15/2028 80 82 6.760% due 06/15/2028 (d) 1,607 1,603 6.829% due 08/15/2028 (d) 243 243 CPS Auto Trust 6.000% due 08/15/2003 53 53 Cross Country Master Credit Card Trust II 7.210% due 06/15/2006 (d) 800 807 CS First Boston Mortgage Securities Corp. 6.750% due 09/25/2028 6,960 6,946 Daimler-Benz Auto Grantor Trust 6.050% due 03/31/2005 1,063 1,064 Delta Funding Home Equity Loan Trust 6.140% due 03/15/2018 13,888 13,902 7.029% due 09/15/2029 (d) 9,603 9,643 6.940% due 06/15/2030 (d) 31,426 31,425 Denver Arena Trust 6.940% due 11/15/2019 272 261 Discover Card Master Trust I 6.996% due 10/16/2013 (d) 400 404 Duck Auto Grantor Trust 5.650% due 03/15/2004 2,361 2,369 7.260% due 05/15/2005 30,542 30,607 Embarcadero Aircraft Securitization Trust 5.644% due 08/15/2025 (d) 11,000 11,000 EQCC Home Equity Loan Trust 6.050% due 01/25/2010 68 68 6.548% due 04/25/2010 201 201 5.770% due 05/20/2010 68 68 6.780% due 10/15/2027 (d) 641 640 Equivantage Home Equity Loan Trust 6.550% due 10/25/2025 70 71 First Alliance Mortgage Loan Trust 6.154% due 01/25/2025 (d) 533 534 5.960% due 03/20/2031 (d) 11,816 11,831 First Omni Bank Credit Card Master Trust 6.650% due 09/15/2003 (d) 1,500 1,502 First Security Auto Grantor Trust 5.970% due 04/15/2004 82 83 FMAC Loan Receivables Trust 7.900% due 04/15/2019 20 21 6.200% due 09/15/2020 133 134 6.500% due 09/15/2020 209 195 6.830% due 09/15/2020 680 657 Ford Credit Auto Owner Trust 6.200% due 04/15/2002 153 153 GE Capital Equipment Lease Trust 6.850% due 05/20/2008 (d) 250 255 GMAC Mortgage Corp. Loan Trust 7.089% due 11/18/2025 (d) 38,438 38,586 7.950% due 03/25/2030 34,303 34,901 Green Tree Financial Corp. 5.760% due 11/01/2018 145 142 8.400% due 06/15/2025 152 153 7.150% due 07/15/2027 24 24 6.490% due 03/15/2028 24,774 25,047 6.420% due 11/15/2028 786 791 6.870% due 02/01/2030 1,620 1,543 6.660% due 06/01/2030 1,405 1,284 5.600% due 12/01/2030 115 115 6.480% due 12/01/2030 55 53 5.510% due 02/01/2031 69 69 7.860% due 04/01/2031 400 410 Green Tree Floorplan Receivables Master Trust 5.921% due 11/15/2004 (d) 46,000 46,014 Green Tree Home Improvement Loan Trust 7.270% due 11/15/2029 (d) 2,649 2,643 Green Tree Recreational, Equipment, & Consumables 6.430% due 04/17/2006 2,035 2,054 6.715% due 02/01/2009 30,412 30,875 6.490% due 02/15/2018 13 13 6.180% due 06/15/2019 184 187 Greenpoint Manufactured Housing 7.270% due 06/15/2029 110 108 Harley-Davidson Eaglemark Motorcycle Trust 5.250% due 07/15/2003 43 43 Headlands Home Equity Loan Trust 5.814% due 12/15/2024 (d) 397 400 HFC Home Equity Loan 6.830% due 12/20/2016 152 152 Household Consumer Loan Trust 7.040% due 08/15/2006 (d) 17,025 16,440 78 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- IMC Home Equity Loan Trust 7.497% due 07/25/2026 (d) $ 589 $ 603 5.740% due 08/20/2029 141 141 IMPAC Secured Assets CMN Owner Trust 7.770% due 07/25/2025 2,000 2,046 Indymac Home Equity Loan Asset-Backed Trust 6.888% due 10/25/2029 (d) 4,942 4,953 6.912% due 07/25/2030 (d) 9,867 9,883 Indymac Manufactured Housing Contract 6.170% due 12/25/2011 4,190 4,204 Korea National Housing 9.969% due 05/23/2001 3,000 3,015 Long Beach Auto Receivables Trust 6.940% due 09/19/2007 3,322 3,400 Long Beach Mortgage Loan Trust 5.240% due 04/21/2008 (d) 11,486 11,497 Marriott Vacation Club Owner Trust 5.930% due 09/20/2017 (d) 77,038 76,976 Mellon Bank Home Equity 6.520% due 07/25/2010 336 336 5.900% due 10/25/2010 10,932 10,955 Merit Securities Corp. 6.160% due 07/28/2033 4,398 4,398 7.880% due 12/28/2033 34,400 35,646 Metris Master Trust 5.658% due 04/20/2006 (d) 20,000 20,143 Metropolitan Asset Funding, Inc. 7.081% due 04/25/2029 (d) 12,231 12,063 Mid-State Trust 8.330% due 04/01/2030 58,707 63,259 MLCC Mortgage Investors, Inc. 5.949% due 03/15/2025 (d) 364 365 MMCA Automobile Trust 6.300% due 06/15/2002 110 110 Morgan Stanley ABS Capital, Inc. 6.930% due 08/25/2030 (d) 143,211 143,479 MPC Natural Gas Funding Trust 6.200% due 03/15/2013 9,316 9,680 MSDWCC Heloc Trust 6.908% due 09/25/2010 (d) 35,556 35,457 Myra-United Mexican States 6.438% due 10/20/2006 (d) 378 366 6.373% due 12/23/2006 1,275 1,237 6.488% due 12/23/2006 (d) 7,051 6,840 7.500% due 12/23/2006 (d) 5,343 5,181 7.750% due 12/23/2006 (d) 3,208 3,111 5.688% due 12/23/2006 (d) 851 826 National Medical Care 6.625% due 09/30/2003 (d) 19,315 19,121 6.313% due 09/30/2003 11,381 11,267 New Holland Equipment Receivables Trust 6.390% due 10/15/2002 84 85 New York City Tax Lien 6.460% due 05/25/2005 87 87 NPF VI, Inc. 6.220% due 06/01/2002 17,150 16,941 NPF XII, Inc. 7.050% due 06/01/2003 50,750 51,495 5.931% due 11/01/2003 (d) 16,000 16,000 Option One Mortgage Loan Trust 5.880% due 05/25/2029 32 32 5.340% due 09/25/2030 (d) 47,572 47,650 Provident Bank Equipment Lease Trust 5.830% due 11/25/2011 (d) 36,372 36,372 Provident Bank Home Equity Loan Trust 6.920% due 06/25/2021 (d) 32,539 32,597 Providian Gateway Master Trust 5.380% due 03/15/2007 28,900 28,900 5.849% due 03/16/2009 (d) 23,000 23,000 Providian Master Trust 6.250% due 06/15/2007 25 26 PSB Lending Home Loan Owner Trust 6.830% due 05/20/2018 3,272 3,296 Residential Asset Mortgage Products, Inc. 6.004% due 09/25/2030 (d) 41,721 41,521 7.980% due 12/25/2030 24,463 25,541 Residential Asset Securities Corp. 6.720% due 04/25/2014 (d) 79 79 6.960% due 07/25/2014 12,477 12,478 6.240% due 02/25/2017 902 901 6.600% due 01/25/2020 13,200 13,311 7.075% due 09/25/2020 190 193 8.000% due 09/25/2021 (d) 5,060 5,210 6.920% due 10/25/2027 (d) 1,677 1,688 Residential Asset Securitization Trust 6.750% due 03/25/2028 40,000 39,683 Residential Funding Mortgage Securities, Inc. 10.836% due 06/01/2001 72,450 72,450 RJR Nabisco 7.500% due 01/01/2002 (d) 19,948 19,948 Ryder Vehicle Lease Trust 6.430% due 01/15/2003 406 407 SallieMae 5.936% due 04/25/2004 (d) 3,049 3,053 6.824% due 07/25/2004 (d) 832 831 5.901% due 10/25/2005 (d) 18,203 18,205 6.825% due 10/25/2005 (d) 11,476 11,468 6.628% due 04/25/2006 (d) 69,553 69,441 Salomon Brothers Mortgage Securities VII 7.020% due 09/25/2029 (d)(i) 330 331 5.584% due 11/15/2029 (d) 17,045 17,117 6.463% due 11/15/2029 (d)(i) 7,800 7,823 Saxon Asset Securities Trust 7.585% due 12/25/2014 45 45 5.760% due 05/25/2029 (d) 5,946 5,950 Sears Credit Account Master Trust 6.050% due 01/15/2008 500 512 Southern Pacific Secured Assets Corp. 5.700% due 07/25/2029 (d) 39,146 39,035 Standard Credit Card Master Trust 8.250% due 11/07/2003 80 82 Team Fleet Financing Corp. 7.350% due 05/15/2003 30 31 The Money Store Home Equity Trust 7.550% due 02/15/2020 196 197 6.345% due 11/15/2021 479 480 6.490% due 10/15/2026 10,354 10,495 Toyota Auto Lease Trust 6.450% due 04/26/2004 300 300 UCFC Home Equity Loan 8.200% due 09/15/2027 70 72 6.870% due 07/15/2029 70 69 UCFC Manufactured Housing Contract 6.680% due 01/15/2010 (d) 1,785 1,786 UniCapital Equipment Contract 6.540% due 07/23/2002 8,657 8,665 USAA Auto Loan Grantor Trust 6.150% due 05/15/2004 651 650 5.800% due 01/15/2005 1,772 1,784 WFS Financial Owner Trust 6.411% due 07/20/2002 7,817 7,829 6.920% due 01/20/2004 27,125 27,631 WMC Mortgage Loan 7.070% due 10/15/2029 74,741 74,787 ------------ Total Asset-Backed Securities 2,838,269 (Cost $2,818,838) ------------ -------------------------------------------------------------------------------- SOVEREIGN ISSUES 1.2% -------------------------------------------------------------------------------- Hellenic Republic 6.938% due 06/06/2001 (d) 20,000 20,026 Hydro-Quebec 7.375% due 02/01/2003 150 156 6.875% due 09/29/2049 (d) 2,000 1,787 Kingdom of Jordan 6.000% due 12/23/2023 7,000 5,330 Kingdom of Sweden 10.250% due 11/01/2015 500 647 Province of Manitoba 7.750% due 02/01/2002 1,000 1,023 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 79 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Province of New Brunswick 7.125% due 10/01/2002 $ 1,700 $ 1,752 Province of Newfoundland 9.000% due 06/01/2019 500 643 Province of Nova Scotia 9.375% due 07/15/2002 1,000 1,056 Province of Ontario 7.750% due 06/04/2002 200 207 7.625% due 06/22/2004 1,000 1,068 7.000% due 08/04/2005 1,000 1,065 6.000% due 02/21/2006 1,800 1,846 5.500% due 10/01/2008 12,000 11,898 Province of Quebec 7.500% due 07/15/2002 6,000 6,206 8.800% due 04/15/2003 1,100 1,184 6.810% due 06/11/2004 (d) 15,500 15,501 6.500% due 01/17/2006 2,000 2,091 6.620% due 04/09/2026 25,000 26,560 Republic of Argentina 5.563% due 03/31/2005 (d) 28,800 24,774 Republic of Brazil 7.625% due 04/15/2006 241,286 218,699 10.125% due 05/15/2027 14,000 10,640 Republic of Bulgaria 3.000% due 07/28/2012 (d) 3,624 2,744 7.750% due 07/28/2024 (d) 320 239 Republic of Croatia 7.000% due 02/27/2002 7,650 7,665 7.750% due 07/31/2006 (d) 2,911 2,846 6.250% due 07/31/2010 (d) 31,750 30,718 Republic of Kazakhstan 8.375% due 10/02/2002 5,000 5,104 Republic of Panama 7.875% due 02/13/2002 1,850 1,866 7.733% due 05/10/2002 (d) 1,975 1,991 4.500% due 07/17/2014 7,675 6,470 Republic of Peru 3.750% due 03/07/2017 3,000 1,868 4.500% due 03/07/2017 (d) 5,750 3,924 3.750% due 03/07/2017 8,000 5,002 Republic of Poland 6.000% due 10/27/2014 9,000 8,764 3.500% due 10/27/2024 (d) 53,940 38,972 4.250% due 10/27/2024 1,600 1,268 Republic of South Africa 9.125% due 05/19/2009 15,000 15,788 State of Israel 6.200% due 06/14/2003 25 25 United Kingdom Gilt 8.000% due 09/27/2013 (j) 1,900 3,497 United Mexican States 9.616% due 04/07/2004 (d) 14,436 14,833 8.500% due 02/01/2006 3,781 3,866 6.250% due 12/31/2019 8,860 7,907 ------------- Total Sovereign Issues 519,516 (Cost $515,566) ------------- -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES (f)(g) 3.1% -------------------------------------------------------------------------------- Canada Treasury Bill 0.000% due 04/12/2001 C$ 20 13 0.000% due 05/10/2001 220 139 Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 73,000 32,372 Halifax Group Euro Finance 7.627% due 12/29/2049 EC 8,500 7,863 KBC Bank Fund Trust IV 8.220% due 11/29/2049 20,764 19,154 Korea Development Bank 4.885% due 05/14/2001 DM 70,000 31,365 2.560% due 06/26/2001 JY 4,000,000 31,889 Korea Electric Power Corp. 3.882% due 10/31/2002 (d) DM 18,900 8,390 Lloyds TSB Capital 7.375% due 02/07/2049 EC 16,000 14,731 Newcourt Credit Group, Inc. 7.625% due 06/28/2001 C$ 9,400 5,987 Republic of Austria 5.500% due 01/15/2010 (j) EC 900 817 Republic of Brazil 8.250% due 11/26/2001 2,000 1,772 Republic of Germany 5.000% due 05/20/2005 155 139 4.125% due 07/04/2008 (j) 15,500 13,205 4.500% due 07/04/2009 (j) 71,300 62,023 5.375% due 01/04/2010 (j) 35,300 32,476 5.250% due 07/04/2010 156,560 143,007 5.250% due 01/04/2011 (j) 294,780 269,108 6.250% due 01/04/2024 (j) 128,451 125,373 6.500% due 07/04/2027 (j) 198,710 200,816 5.600% due 01/04/2028 (j) 108,710 98,594 6.250% due 01/04/2030 (j) 100 99 Royal Bank of Scotland Group PLC 8.300% due 03/31/2049 BP 85,000 103,104 Treuhandanstalt 6.250% due 03/04/2004 EC 60 55 United Mexican States 6.000% due 03/28/2002 JY 100,000 830 3.100% due 04/24/2002 2,542,000 20,470 8.750% due 05/30/2002 BP 23,000 33,184 10.375% due 01/29/2003 DM 200 95 7.000% due 06/02/2003 C$ 30,200 19,158 7.432% due 04/07/2004 (d) EC 18,181 16,223 6.750% due 06/06/2006 JY 2,000,000 18,678 7.500% due 03/08/2010 EC 5,000 4,341 1.103% due 12/31/2019 (d) JY 1,662,500 12,936 ------------- Total Foreign Currency-Denominated Issues 1,328,406 (Cost $1,374,968) ------------- -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- General National Mortgage Association (OTC) 6.000% due 05/21/2031 Strike @ 90.281 Exp. 05/04/2001 $ 497,000 1 General National Mortgage Association (OTC) 7.500% due 05/21/2031 Strike @ 96.641 Exp. 05/04/2001 940,000 2 Harborview Mortgage Loan Trust (OTC) 7.470% due 08/19/2030 Strike @ 100.000 Exp. 05/01/2005 22,975 0 ------------- Total Purchased Put Options 3 (Cost $112) ------------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 0.0% -------------------------------------------------------------------------------- Banking & Finance 0.0% Bell Atlantic Financial Services 5.750% due 04/01/2003 1,500 1,505 Cox Communications, Inc. 0.426% due 04/19/2020 25 10,063 ------------- Total Convertible Bonds & Notes 11,568 (Cost $14,839) ------------- -------------------------------------------------------------------------------- PREFERRED SECURITY 0.8% -------------------------------------------------------------------------------- Shares DG Funding Trust 7.150% due 12/29/2049 (d) 35,150 358,530 ------------- Total Preferred Security 358,530 (Cost $351,502) ------------- 80 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Value Shares (000s) -------------------------------------------------------------------------------- PREFERRED STOCK 0.2% -------------------------------------------------------------------------------- Banco Bilbao Vizcaya International 9.750% due 12/31/2049 266,217 $ 6,909 Centaur Funding Corp. 9.080% due 04/21/2020 125 131 CSC Holdings, Inc. 11.125% due 04/01/2008 27,038 2,947 Fortis Amev NV 6.430% due 12/31/2049 85 11,220 5.080% due 12/31/2049 (d) 86 11,352 Home Ownership Funding 13.331% due 12/31/2049 1,125 849 SI Financing Trust I 9.500% due 06/30/2026 396,194 10,024 TCI Communications, Inc. 9.720% due 12/31/2036 622,553 15,844 10.000% due 05/31/2045 49,000 1,230 ------------- Total Preferred Stock 60,506 (Cost $60,018) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 11.8% -------------------------------------------------------------------------------- Principal Amount (000s) Certificates of Deposit 0.1% Mexico Credit Link 11.384% due 02/22/2002 $ 29,500 30,247 11.804% due 02/25/2002 2,000 2,088 ------------- 32,335 ------------- Commercial Paper 11.2% Abbey National North America 5.500% due 04/10/2001 31,500 31,462 5.090% due 04/19/2001 2,400 2,394 5.340% due 04/19/2001 1,500 1,496 5.350% due 04/19/2001 6,800 6,783 5.450% due 04/19/2001 1,100 1,097 5.420% due 04/26/2001 2,200 2,192 5.345% due 05/02/2001 126,400 125,837 5.050% due 08/01/2001 2,000 1,967 5.060% due 08/01/2001 1,000 984 4.930% due 08/01/2001 35,000 34,426 5.010% due 08/06/2001 700 688 5.040% due 08/06/2001 41,800 41,089 5.020% due 08/07/2001 74,200 72,928 5.050% due 08/08/2001 3,700 3,636 5.040% due 08/08/2001 600 590 5.020% due 08/08/2001 6,700 6,584 5.010% due 08/08/2001 17,100 16,805 Abbey National PLC 5.240% due 04/10/2001 200 200 4.870% due 05/02/2001 16,800 16,732 5.070% due 05/02/2001 2,100 2,091 4.700% due 09/05/2001 3,500 3,428 4.710% due 09/06/2001 16,800 16,451 Abbott Laboratories 5.100% due 04/05/2001 19,600 19,592 ABN Amro North America Finance, Inc. 5.340% due 04/02/2001 600 600 Alcoa, Inc. 5.310% due 04/02/2001 11,300 11,300 5.300% due 04/10/2001 40,000 39,953 5.170% due 04/11/2001 800 799 5.300% due 04/20/2001 439 438 5.170% due 04/25/2001 300 299 American Express Co. 5.150% due 04/04/2001 169,700 169,651 5.240% due 04/04/2001 1,000 1,000 5.300% due 04/04/2001 32,500 32,490 5.320% due 04/04/2001 49,400 49,385 5.620% due 04/06/2001 3,700 3,698 6.240% due 04/06/2001 2,600 2,598 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 81 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 5.490% due 04/06/2001 $ 800 $ 800 5.410% due 04/06/2001 300 300 6.360% due 04/06/2001 600 600 4.950% due 04/27/2001 100 100 4.840% due 05/15/2001 8,000 7,954 4.860% due 05/15/2001 4,900 4,872 Anz, Inc. 5.410% due 04/18/2001 3,400 3,392 Becton Dickinson & Co. 5.250% due 04/11/2001 2,400 2,397 6.110% due 04/25/2001 2,200 2,191 5.350% due 04/25/2001 23 23 4.920% due 06/20/2001 400 396 4.940% due 07/25/2001 1,500 1,477 4.800% due 07/25/2001 5,300 5,218 Bellsouth Capital Funding Corp. 5.340% due 04/11/2001 32,300 32,257 Campbell Soup Co. 5.440% due 04/16/2001 200 200 CBA (de) Finance 5.340% due 04/11/2001 3,900 3,895 4.960% due 04/23/2001 19,300 19,244 4.990% due 04/23/2001 6,300 6,282 5.040% due 04/23/2001 100 100 5.020% due 08/09/2001 1,800 1,769 5.040% due 08/09/2001 3,400 3,339 CDC 5.130% due 04/25/2001 1,000 997 5.460% due 04/25/2001 600 598 Coca-Cola Co. 5.100% due 04/02/2001 3,300 3,300 4.990% due 04/12/2001 100 100 5.080% due 04/12/2001 4,400 4,394 4.580% due 07/12/2001 500 493 4.600% due 07/12/2001 2,500 2,465 E.I. Du Pont 5.170% due 04/05/2001 27,500 27,480 Executive Jet, Inc. 4.940% due 04/18/2001 1,900 1,896 4.960% due 04/25/2001 15,350 15,301 4.960% due 04/27/2001 10,000 9,966 5.330% due 05/23/2001 1,200 1,191 4.860% due 06/27/2001 10,000 9,884 5.280% due 06/27/2001 6,600 6,523 4.970% due 08/01/2001 35,000 34,426 5.040% due 08/08/2001 3,100 3,046 5.030% due 08/08/2001 9,000 8,845 Exxon Mobil 5.390% due 04/04/2001 2,700 2,699 5.140% due 04/04/2001 5,500 5,498 Fannie Mae 5.810% due 05/24/2001 5,300 5,256 4.890% due 06/07/2001 400 396 4.720% due 08/15/2001 40,600 39,864 4.685% due 09/06/2001 19,300 18,899 Federal Farm Credit Bank 4.630% due 08/29/2001 3,000 2,941 4.650% due 08/29/2001 8,500 8,332 Federal Home Loan Bank 4.980% due 04/05/2001 50,000 49,987 4.910% due 05/11/2001 326 324 4.675% due 09/07/2001 5,200 5,092 Freddie Mac 4.980% due 04/02/2001 17,900 17,893 4.950% due 04/03/2001 2,000 2,000 5.250% due 04/17/2001 263 262 5.320% due 04/26/2001 3,000 2,989 6.320% due 04/26/2001 325 324 4.700% due 05/16/2001 72,500 72,084 Gannett Co. 4.990% due 04/11/2001 56,400 56,330 5.090% due 04/11/2001 8,500 8,489 5.000% due 04/20/2001 34,100 34,015 General Electric Capital Corp. 5.200% due 04/03/2001 45,300 45,293 5.090% due 04/03/2001 800 800 4.990% due 04/03/2001 200 199 5.410% due 04/03/2001 6,400 6,399 4.970% due 04/04/2001 3,700 3,699 4.990% due 04/04/2001 800 800 5.170% due 04/04/2001 300 300 5.350% due 04/04/2001 6,700 6,698 5.370% due 04/04/2001 4,400 4,399 5.390% due 04/04/2001 6,800 6,798 5.480% due 04/05/2001 2,900 2,899 5.440% due 04/18/2001 400 398 5.200% due 04/18/2001 1,600 1,596 5.190% due 04/18/2001 1,100 1,098 4.980% due 04/25/2001 2,300 2,293 5.450% due 04/25/2001 500 498 5.370% due 04/25/2001 3,000 2,990 5.330% due 04/25/2001 3,300 3,289 5.320% due 04/25/2001 11,500 11,461 5.470% due 04/25/2001 60,400 60,189 5.020% due 04/25/2001 1,000 997 4.940% due 04/25/2001 1,600 1,594 4.900% due 04/25/2001 54,200 54,030 0.040% due 04/25/2001 3,000 2,990 5.090% due 04/25/2001 1,500 1,495 5.180% due 04/25/2001 1,800 1,794 5.350% due 05/09/2001 53,500 53,206 4.690% due 05/30/2001 1,000 992 5.480% due 05/30/2001 5,000 4,959 5.340% due 05/30/2001 4,700 4,661 4.940% due 05/30/2001 200 198 4.780% due 05/30/2001 300 298 4.870% due 05/30/2001 3,000 2,975 5.310% due 06/06/2001 1,300 1,288 5.520% due 06/06/2001 4,200 4,162 5.340% due 06/06/2001 1,300 1,288 5.140% due 06/06/2001 7,800 7,729 5.130% due 06/06/2001 2,400 2,378 5.920% due 06/06/2001 32,900 32,601 5.220% due 06/06/2001 900 892 4.600% due 07/18/2001 3,300 3,255 5.000% due 08/15/2001 200 196 4.930% due 08/22/2001 83,000 81,425 Gillette Co. 5.060% due 04/17/2001 200 200 5.440% due 04/17/2001 9,400 9,379 4.910% due 08/21/2001 1,100 1,079 Glaxo Wellcome 4.970% due 04/30/2001 79,500 79,193 Goldman Sachs Group 4.540% due 09/19/2001 100 98 Halifax Building Society 5.220% due 04/18/2001 300 299 5.350% due 04/18/2001 14,400 14,366 5.370% due 04/18/2001 2,300 2,295 5.390% due 04/18/2001 4,100 4,090 5.480% due 04/18/2001 4,800 4,788 5.010% due 05/30/2001 1,200 1,190 4.950% due 08/01/2001 35,800 35,213 5.000% due 08/02/2001 25,000 24,587 5.080% due 08/08/2001 3,500 3,437 5.050% due 08/08/2001 2,900 2,850 4.700% due 09/04/2001 11,000 10,774 Heinz Corp. 4.890% due 05/01/2001 1,200 1,195 KFW International Finance, Inc. 5.090% due 04/23/2001 3,800 3,789 5.340% due 04/24/2001 2,200 2,193 5.320% due 05/30/2001 1,500 1,488 4.910% due 05/30/2001 4,100 4,066 5.270% due 05/30/2001 4,300 4,265 5.820% due 06/06/2001 20,000 19,818 5.260% due 06/06/2001 200 198 5.460% due 06/06/2001 4,000 3,964 4.930% due 07/30/2001 40,000 39,354 5.000% due 08/08/2001 3,700 3,636 5.010% due 08/08/2001 1,200 1,179 5.070% due 08/08/2001 1,200 1,179 Monsanto Co. 5.210% due 04/11/2001 1,000 999 4.970% due 08/08/2001 1,100 1,081 4.980% due 08/15/2001 2,000 1,963 4.650% due 08/16/2001 2,200 2,160 4.920% due 08/16/2001 6,650 6,529 4.800% due 08/27/2001 40,000 39,217 5.020% due 08/29/2001 20,000 19,604 Morgan Stanley Group, Inc. 5.050% due 04/11/2001 175,100 174,879 4.950% due 04/25/2001 500 498 Motorola, Inc. 6.210% due 04/20/2001 200 199 National Australia Funding 5.070% due 04/04/2001 2,123 2,122 5.100% due 04/05/2001 184,900 184,821 National Rural Utilities Cooperative Finance Corp. 5.190% due 04/11/2001 4,100 4,095 5.140% due 04/11/2001 5,100 5,093 4.870% due 04/11/2001 5,200 5,194 4.940% due 04/11/2001 1,600 1,598 4.920% due 04/17/2001 4,700 4,690 5.250% due 05/24/2001 190 189 5.340% due 05/24/2001 1,000 992 5.300% due 05/24/2001 2,600 2,580 5.240% due 05/24/2001 1,400 1,389 5.180% due 05/24/2001 300 298 4.820% due 05/24/2001 23,500 23,336 4.810% due 05/24/2001 200 199 5.290% due 05/24/2001 4,500 4,466 4.880% due 05/25/2001 8,900 8,836 4.910% due 05/25/2001 42,000 41,696 4.550% due 08/24/2001 400 393 5.070% due 08/24/2001 2,600 2,547 Reseau Ferre De France 4.590% due 07/25/2001 1,700 1,674 4.620% due 07/25/2001 3,500 3,446 4.620% due 08/16/2001 8,900 8,738 SBC Communications, Inc. 5.300% due 04/03/2001 50,300 50,293 5.330% due 04/04/2001 400 400 5.340% due 04/04/2001 12,000 11,996 5.290% due 04/10/2001 12,400 12,385 5.330% due 04/16/2001 22,000 21,954 Swedbank, Inc. 5.390% due 04/12/2001 2,000 1,997 5.080% due 04/12/2001 980 979 5.370% due 04/12/2001 3,800 3,794 5.160% due 04/23/2001 2,300 2,293 4.930% due 04/25/2001 12,400 12,361 5.140% due 04/25/2001 3,200 3,189 4.860% due 05/30/2001 20,000 19,836 5.010% due 05/30/2001 7,400 7,339 5.290% due 05/30/2001 1,700 1,686 5.340% due 05/30/2001 2,600 2,579 5.370% due 05/30/2001 1,000 992 5.000% due 08/06/2001 12,200 11,992 5.010% due 08/06/2001 12,700 12,484 4.850% due 08/06/2001 2,100 2,064 5.020% due 08/08/2001 23,200 22,799 5.060% due 08/08/2001 4,600 4,521 5.100% due 08/08/2001 6,600 6,486 4.890% due 08/08/2001 1,600 1,572 5.010% due 08/09/2001 27,600 27,120 4.790% due 08/15/2001 8,600 8,444 4.630% due 08/23/2001 1,300 1,275 4.900% due 08/23/2001 6,000 5,885 4.700% due 09/05/2001 1,300 1,273 4.740% due 09/05/2001 14,100 13,809 82 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- UBS Finance, Inc. 0.400% due 04/02/2001 $ 15,000 $ 15,000 5.400% due 04/02/2001 403,600 403,600 5.300% due 04/04/2001 101,000 100,970 5.010% due 04/18/2001 300 299 5.340% due 04/18/2001 4,400 4,389 5.460% due 04/18/2001 1,600 1,595 5.360% due 05/07/2001 20,000 19,832 5.410% due 05/16/2001 3,800 3,774 5.340% due 05/16/2001 16,000 15,895 5.350% due 05/16/2001 4,200 4,172 5.820% due 05/30/2001 273,700 271,453 5.510% due 06/06/2001 9,200 9,116 5.830% due 06/06/2001 1,000 991 5.920% due 06/06/2001 93,600 92,748 5.520% due 06/06/2001 2,900 2,874 5.240% due 06/06/2001 4,300 4,261 5.190% due 06/06/2001 12,000 11,890 5.340% due 06/06/2001 2,300 2,279 4.670% due 06/13/2001 63,000 62,316 4.940% due 06/13/2001 2,200 2,178 4.970% due 06/13/2001 300 297 5.160% due 06/13/2001 7,100 7,029 5.190% due 06/13/2001 2,400 2,376 5.290% due 06/13/2001 125,000 123,753 4.970% due 08/01/2001 57,000 56,065 5.010% due 08/01/2001 35,600 35,016 5.050% due 08/01/2001 1,600 1,574 4.550% due 08/02/2001 2,400 2,360 5.040% due 08/02/2001 42,000 41,305 5.050% due 08/02/2001 5,000 4,917 5.070% due 08/02/2001 9,900 9,730 4.790% due 08/07/2001 100 98 5.030% due 08/07/2001 248,500 244,241 5.030% due 08/08/2001 35,000 34,396 5.070% due 08/08/2001 6,600 6,486 5.040% due 08/08/2001 7,800 7,665 4.900% due 08/08/2001 200 197 5.050% due 08/08/2001 300 295 5.010% due 08/08/2001 29,600 29,089 4.590% due 08/15/2001 2,100 2,062 4.760% due 08/15/2001 1,100 1,080 4.820% due 08/15/2001 3,100 3,044 4.740% due 09/04/2001 125,000 122,435 4.750% due 09/05/2001 6,500 6,366 4.740% due 09/05/2001 9,500 9,304 4.740% due 09/06/2001 44,400 43,478 4.740% due 09/12/2001 65,000 63,604 Verizon Global Funding 5.320% due 04/02/2001 1,700 1,700 5.310% due 04/05/2001 2,600 2,599 5.340% due 04/05/2001 5,300 5,298 4.960% due 05/04/2001 700 697 5.010% due 05/16/2001 4,800 4,771 4.980% due 05/25/2001 400 397 4.750% due 06/15/2001 300 297 Walt Disney Co. 4.690% due 08/07/2001 1,800 1,769 4.900% due 08/07/2001 3,400 3,342 Williams Cos., Inc. 7.231% due 04/10/2001 23,200 23,209 7.231% due 04/10/2001 10,700 10,700 7.231% due 04/10/2001 10,300 10,304 Wisconsin Electric Power & Light 5.040% due 04/12/2001 200 200 5.100% due 04/12/2001 800 799 ------------ 4,774,003 ------------ Repurchase Agreement 0.4% Daiwa Securities 5.150% due 04/02/2001 $ 165,000 $ 165,000 (Dated 03/30/2001. Collateralized by ------------ U.S. Treasury Bills 4.420% due 09/13/2001 valued at $168,527. Repurchase proceeds are $165,071.) U.S. Treasury Bills 0.1% 5.073% due 05/17/2001 (b) 21,685 21,566 ------------ Total Short-Term Instruments 4,992,904 (Cost $4,992,031) ------------ Total Investments (a) 151.2% $ 64,127,213 (Cost $63,623,558) Written Options (c) (0.1%) (42,637) (Premiums $35,755) Other Assets and Liabilities (Net) (51.1%) (21,679,183) ------------ Net Assets 100.0% $ 42,405,393 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $63,665,744 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 781,956 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (353,054) ------------ Unrealized appreciation-net $ 428,902 ------------ (b) Securities with an aggregate market value of $246,132 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- Eurodollar March Futures (03/2002) 762 $ 429 Eurodollar June Futures (06/2002) 8,899 1,470 Eurodollar September Futures (09/2002) 8,899 1,289 Eurodollar December Futures (12/2002) 8,899 984 Eurodollar March Futures (03/2003) 8,137 586 Municipal Bond (06/2001) 711 (513) EuroBond 10 Year Note (06/2001) 30,855 30,576 U.S. Treasury 5 Year Note (06/2001) 11,913 (6,762) U.S. Treasury 10 Year Note (06/2001) 219 67 U.S. Treasury 30 Year Bond (06/2001) 26,537 (7,889) Euribor Futures (06/2001) 823 1,454 Euribor Futures (03/2002) 4,117 4,313 Government of Japan 10 Year Note (06/2001) 39 (41) United Kingdom 90 Day LIBOR Futures (03/2002) 275 219 United Kingdom 90 Day LIBOR Futures (06/2002) 275 207 United Kingdom 90 Day LIBOR Futures (09/2002) 275 190 United Kingdom 90 Day LIBOR Futures (12/2002) 275 199 ------------ $ 26,778 ------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 83 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 -------------------------------------------------------------------------------- (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/25/2001 93,100,000 $ 894 $ 1,621 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/25/2001 186,100,000 1,795 3,240 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 253,000,000 2,459 4,602 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 84,300,000 773 1,533 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/31/2001 168,800,000 1,563 3,070 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 06/04/2001 244,200,000 1,444 4,617 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/21/2001 74,600,000 2,286 1,028 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/22/2001 92,700,000 2,718 1,283 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/27/2001 74,600,000 2,137 1,056 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 12/03/2001 93,600,000 1,937 1,358 Put - CME Eurodollar December Futures Strike @ 95.00 Exp. 12/17/2001 1,714 720 514 Put - CME Eurodollar December Futures Strike @ 95.25 Exp. 12/17/2001 9,545 4,772 5,250 Call - CBOT U.S.Treasury Note June Futures Strike @ 107.00 Exp. 05/26/2001 1,885 1,198 1,590 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 13,125 7,161 7,177 Put - CBOT U.S. Treasury Note June Futures Strike @ 105.00 Exp. 05/26/2001 5,303 2,906 3,397 Put - CBOT U.S. Treasury Note December Futures Strike @ 105.00 Exp. 12/17/2001 1,734 993 1,301 -------------------- $ 35,755 $ 42,637 -------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Security is in default. -------------------------------------------------------------------------------- (f) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Sell C$ 36,714 04/2001 $ 460 Buy EC 1,338,388 04/2001 (64,986) Sell 1,335,461 04/2001 16,412 Buy 1,059,188 06/2001 (3,998) Sell BP 96,680 05/2001 4,711 Buy HF 2,000,000 09/2001 (153) Buy JY 104,105,954 04/2001 (19,233) Sell 104,105,954 04/2001 19,353 Sell 103,755,954 06/2001 16,401 Sell N$ 50,890 04/2001 881 ----------- $ (30,152) ----------- (g) Principal amount denoted in indicated currency: BP - British Pound C$ - Canadian Dollar DM - German Mark EC - Euro HF - Hungarian Forint JY - Japanese Yen N$ - New Zealand Dollar (h) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ -------------------------------------------------------------------------------- Type Amount (Depreciation) Receive floating rate based on $13,033,000 notional amount with 3-month LIBOR plus 1.600% and pay $25,000,000 notional amount with a fixed rate equal to 0.426%. Broker: Lehman Brothers Exp. 04/19/2005 $ 13,033 $ 1 Receive floating rate based on 3-month LIBOR plus 0.500% and pay a fixed rate equal to 7.600%. Broker: Lehman Brothers Exp. 07/15/2003 35,000 (1,647) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.295%. Broker: Goldman Sachs Exp. 04/14/2008 JY 11,635,000 (8,598) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.305%. Broker: Goldman Sachs Exp. 04/15/2008 7,563,000 (5,627) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.669%. Broker: Goldman Sachs Exp. 05/18/2007 51,000,000 (21,103) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.305%. Broker: Goldman Sachs Exp. 04/15/2008 377,000 (121) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.669%. Broker: Goldman Sachs Exp. 05/18/2007 1,500,000 (550) 84 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes -------------------------------------------------------------------------------- Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.295%. Broker: Goldman Sachs Exp. 04/14/2008 JY 580,000 $ (184) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.340%. Broker: Goldman Sachs Exp. 10/07/2007 24,500,000 (18,409) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.495%. Broker: Goldman Sachs Exp. 09/16/2008 7,000,000 (1,957) Receive a fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2006 $ 385,300 4,258 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.805%. Broker: Morgan Stanley Dean Witter Exp. 01/11/2011 JY 1,389,000 (488) Receive a fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Dean Witter Exp. 06/15/2006 $ 797,200 2,399 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.757%. Broker: Merrill Lynch Exp. 01/11/2001 JY 10,000,000 (3,167) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.771%. Broker: Morgan Stanley Dean Witter Exp. 01/11/2001 42,373,000 (13,860) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.777%. Broker: Goldman Sachs Exp. 01/12/2011 48,070,000 (15,915) Receive a fixed rate equal to 5.633% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/02/2004 BP 211,900 2,770 Receive a fixed rate equal to 5.626% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 02/02/2004 716,100 9,200 Receive a fixed rate equal to 5.560% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 02/27/2003 241,400 1,249 Receive a fixed rate equal to 5.387% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 02/28/2003 BP 10,000 $ 48 Receive a fixed rate equal to 5.405% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/28/2003 200,000 1,042 Receive a fixed rate equal to 5.518% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/28/2004 52,600 491 Receive a fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/02/2004 96,500 873 Receive a fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/02/2004 52,200 472 Receive a fixed rate equal to 5.478% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/08/2004 500,000 4,145 Receive a fixed rate equal to 5.471% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/15/2006 1,020,300 6,403 Receive a fixed rate equal to 5.484% and pay floating rate based on 6-month BP-LIBOR. Broker: J.P. Morgan Exp. 03/15/2006 421,100 2,581 Receive a fixed rate equal to 5.421% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/15/2006 147,000 821 Recieve floating rate based on 6-month BP-LIBOR and pay a fixed rate equal to 5.220%. Broker: J.P. Morgan Exp. 09/19/2002 280,500 32 Receive a fixed rate equal to 5.308% and pay floating rate based on 6-month BP-LIBOR. Broker: J.P. Morgan Exp. 03/19/2006 280,500 (1,456) Receive a fixed rate equal to 5.305% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/19/2006 629,900 (2,716) See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 85 Schedule of Investments (Cont.) Total Return Fund March 31, 2001 Receive floating rate based on 6-month BP-LIBOR and pay a fixed rate equal to 5.215%. Broker: Goldman Sachs Exp. 09/19/2002 BP 629,900 $ 5 Receive a fixed rate equal to 5.207% and pay floating rate based on 6-month BP-LIBOR. Broker: J.P. Morgan Exp. 03/15/2004 197,100 (349) Receive a fixed rate equal to 5.207% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 03/15/2004 167,300 (296) Receive a fixed rate equal to 9.250% and pay a fixed rate equal to 5.050%. In the event of default of Republic of Argentina Floating Rate Notes and/or Spread-Adjusted Notes, the Fund can put the bond to the counterparty at par. Broker: Deutsche Bank AG New York Exp. 05/03/2001 $ 6,000 (201) Receive fixed rate equal to 0.650% and the Fund will pay to the counterparty at par in the event of default of Niagara Mohawk Corp. 7.750% due 10/01/2008. Broker: Lehman Brothers Exp. 12/31/2004 50,000 3 Receive fixed rate equal to 0.400% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.400% due 02/01/2004. Broker: Goldman Sachs Exp. 11/10/2002 20,000 1 Receive fixed rate equal to 0.510% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 01/25/2005 10,000 0 Receive fixed rate equal to 5.600% and the Fund will pay to the counterparty at par in the event of default of the Republic of Venezuela 9.250% due 09/15/2027. Broker: Deutsche Bank AG New York Exp. 04/04/2001 25,000 14 Receive fixed rate equal to 5.850% and the Fund will pay to the counterparty at par in the event of default of the Republic of Venezuela 9.250% due 09/15/2027. Broker: Deutsche Bank AG New York Exp. 04/17/2001 10,000 6 Receive fixed rate equal to 0.250% and the Fund will pay to the counterparty at par in the event of default of Wisconsin Electric Power 6.625% due 11/16/2006. Broker: Lehman Brothers Exp. 04/18/2003 25,000 1 Receive fixed rate equal to 1.900% and the Fund will pay to the counterparty at par in the event of default of the Republic of Brazil based on 6-month LIBOR plus 0.813% due 04/15/2006. Broker: Credit Suisse First Boston International Exp. 05/03/2001 50,000 415 Receive fixed rate equal to 1.300% and the Fund will pay to the counterparty at par in the event of default of United Mexican States 9.875% due 01/15/2007. Broker: Salomon Brothers, Inc. Exp. 05/09/2002 $ 50,000 $ 7 Receive fixed rate equal to 0.100% and the Fund will pay to the counterparty at par in the event of default of General Electric Capital Corp. 7.250% due 02/02/2005. Broker: J.P. Morgan Exp. 05/19/2001 50,000 1 Receive fixed rate equal to 1.500% and the Fund will pay to the counterparty at par in the event of default of United Mexican States 9.875% due 01/15/2007. Broker: Salomon Brothers, Inc. Exp. 06/13/2002 50,000 8 Receive fixed rate equal to 0.500% and the Fund will pay to the counterparty at par in the event of default of Raytheon Corp. 6.500% due 07/15/2005. Broker: Merrill Lynch Exp. 06/30/2001 25,000 1 ------------ $ (59,395) ------------ (i) Principal amount of the security is adjusted for inflation. (j) Subject to financing transaction. (k) Securities are grouped by coupon or range of coupons and represent a range of maturities. (l) Restricted security. 86 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments Total Return Fund II March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 37.4% -------------------------------------------------------------------------------- Banking & Finance 29.7% Abbey National Capital Trust I 8.963% due 12/29/2049 (d) $ 1,900 $ 2,107 Aetna, Inc. 6.750% due 08/15/2001 1,715 1,725 Allstate Corp. 6.750% due 06/15/2003 9,300 9,588 7.875% due 05/01/2005 200 215 American Express Travel 5.625% due 01/22/2004 5,000 5,050 Associates Corp. of North America 5.750% due 11/01/2003 600 606 AT&T Capital Corp. 5.881% due 04/23/2002 (d) 30,000 30,073 Bank of America Corp. 7.500% due 10/15/2002 400 415 Bank of Hawaii 6.875% due 06/01/2003 7,750 7,608 Bank of New York Co., Inc. 6.625% due 06/15/2003 5,000 5,148 Bellsouth Savings & Employee Stock Ownership Trust 9.125% due 07/01/2003 15 16 Beneficial Corp. 6.750% due 02/11/2003 10 10 Caterpillar Financial Services Corp. 5.890% due 06/17/2002 840 850 Chase Manhattan Corp. 7.625% due 01/15/2003 5,000 5,198 Chrylser Financial Corp. LLC 5.010% due 06/15/2001 (d) 5,000 4,993 6.950% due 03/25/2002 730 743 CIT Group, Inc. 5.190% due 09/13/2002 (d) 10,000 9,971 Citicorp 7.125% due 06/01/2003 4,000 4,156 Citigroup, Inc. 9.500% due 03/01/2002 200 208 Donaldson, Lufkin & Jenrette, Inc. 6.258% due 07/18/2003 (d) 7,000 7,021 6.875% due 11/01/2005 225 234 First Chicago Corp. 6.875% due 06/15/2003 4,000 4,113 Ford Motor Credit Co. 8.200% due 02/15/2002 11,140 11,430 6.341% due 03/19/2002 (d) 35 35 8.000% due 06/15/2002 5,000 5,161 5.561% due 02/03/2003 (d) 10,000 9,971 5.132% due 03/17/2003 (d) 10,000 9,925 5.605% due 11/24/2003 (d) 5,000 4,991 5.750% due 02/23/2004 4,200 4,198 6.125% due 03/20/2004 1,300 1,312 6.700% due 07/16/2004 200 205 7.500% due 03/15/2005 30,000 31,415 General Motors Acceptance Corp. 5.350% due 12/07/2001 600 603 5.500% due 12/15/2001 765 765 5.480% due 12/16/2002 235 235 5.547% due 02/14/2003 (d) 20,000 19,925 6.858% due 08/18/2003 (d) 1,700 1,698 6.396% due 01/20/2004 (d) 24,825 24,822 Goldman Sachs Group, Inc. 7.800% due 07/15/2002 9,500 9,794 5.900% due 01/15/2003 2,000 2,018 5.306% due 03/19/2003 (d) 5,000 5,007 6.368% due 01/20/2009 (d) 5,000 5,011 Heller Financial, Inc. 5.888% due 04/22/2002 (d) 5,000 5,000 6.500% due 07/22/2002 10,000 10,146 6.440% due 10/06/2002 400 405 5.857% due 04/28/2003 (d) 15,000 14,958 7.875% due 05/15/2003 150 157 Household Finance Corp. 5.116% due 06/24/2003 (d) 15,000 14,950 6.250% due 08/15/2003 50 51 5.875% due 09/25/2004 15,000 14,976 KBC Bank Fund Trust III 9.860% due 11/29/2049 (d) 12,000 13,461 Key Bank NA 5.101% due 07/23/2001 (d) 5,000 5,002 Mellon Funding Corp. 5.750% due 11/15/2003 200 202 Merrill Lynch & Co. 7.050% due 06/04/2001 16,175 16,242 6.613% due 06/24/2003 (d) 20,000 19,994 Morgan Stanley, Dean Witter & Co. 7.125% due 01/15/2003 275 284 5.590% due 05/05/2003 (d) 20,000 20,041 5.660% due 08/07/2003 (d) 6,200 6,208 National Rural Utilities Cooperative Finance Corp. 6.070% due 06/05/2002 25 25 NationsBank Corp. 6.200% due 08/15/2003 10,800 11,000 8.625% due 11/15/2003 1,550 1,675 PNC Funding Corp. 6.125% due 09/01/2003 1,400 1,426 Popular North American, Inc. 6.875% due 06/15/2001 7,000 7,025 Qwest Capital Funding, Inc. 6.875% due 08/15/2001 8,750 8,802 Salomon, Smith Barney Holdings 5.847% due 04/28/2003 (d) 9,000 9,009 Sears Roebuck Acceptance Corp. 6.710% due 08/13/2001 40 40 Textron Financial Corp. 5.543% due 05/28/2002 (d) 10,000 9,988 6.041% due 09/17/2002 (d) 25,000 25,046 UBS Preferred Funding Trust I 8.622% due 10/29/2049 19,700 21,818 Wachovia Corp. 7.308% due 05/02/2005 (d) 15,000 14,982 Westdeutsche Landesbank 6.050% due 01/15/2009 625 616 ------------- 502,098 ------------- Industrials 3.8% AMR Corp. 9.430% due 05/10/2001 1,000 1,002 Conoco, Inc. 5.900% due 04/15/2004 250 254 Continental Cablevision 8.300% due 05/15/2006 100 108 DaimlerChrysler North America Holding Corp. 6.898% due 01/18/2002 (d) 20,000 19,903 Dow Chemical Co. 8.040% due 07/02/2005 4,800 5,104 Enron Corp. 5.510% due 09/10/2001 (d) 20,000 20,017 Ford Motor Co. 9.000% due 09/15/2001 300 305 Mattel, Inc. 6.000% due 07/15/2003 250 242 Norfolk Southern Corp. 6.950% due 05/01/2002 3,000 3,049 Philip Morris Cos., Inc. 6.000% due 07/15/2001 1,000 999 Phillips Petroleum Co. 6.650% due 03/01/2003 400 410 Procter & Gamble Co. 5.250% due 09/15/2003 600 605 Sears, Roebuck & Co. 8.300% due 10/26/2004 500 535 Time Warner, Inc. 7.975% due 08/15/2004 3,345 3,568 Times Mirror Co. 6.650% due 10/15/2001 300 303 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 87 Schedule of Investments (Cont.) Total Return Fund II March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Transcontinental Gas Pipelines 6.125% due 01/15/2005 $ 300 $ 303 United Air Lines, Inc. 9.190% due 12/24/2013 7,213 7,568 ------------- 64,275 ------------- Utilities 3.9% Allegheny Energy Supply 6.325% due 05/01/2002 (d) 13,900 13,910 Carolina Power & Light Energy, Inc. 6.117% due 07/29/2002 (d) 9,100 9,121 7.875% due 04/15/2004 400 423 Commonwealth Edison Co. 6.625% due 07/15/2003 288 295 Marlin Water Trust 7.090% due 12/15/2001 808 815 Metropolitan Edison Co. 7.220% due 01/30/2003 2,000 2,073 6.400% due 02/09/2006 2,412 2,488 Oneok, Inc. 6.231% due 04/24/2002 (d) 5,000 5,009 Pacificorp 7.200% due 08/15/2002 11,000 11,329 Philadelphia Electric 7.125% due 09/01/2002 90 92 6.500% due 05/01/2003 1,840 1,880 Reliant Energy, Inc. 7.875% due 07/01/2002 1,375 1,396 Sprint Capital Corp. 5.700% due 11/15/2003 375 370 Sprint Corp. 9.440% due 08/15/2001 10,000 10,153 Texas Utilities Corp. 7.375% due 08/01/2001 1,900 1,912 6.750% due 03/01/2003 5,000 5,104 ------------- 66,370 ------------- Total Corporate Bonds & Notes 632,743 (Cost $625,227) ------------- -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.1% -------------------------------------------------------------------------------- Kansas 0.1% Wichita, Kansas Hospital Revenue Bonds, Series 1999 6.250% due 11/15/2024 1,000 1,054 ------------- Total Municipal Bonds & Notes 1,054 (Cost $994) ------------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 3.5% -------------------------------------------------------------------------------- Fannie Mae 5.375% due 03/15/2002 55 55 5.250% due 01/15/2003 60 61 5.750% due 04/15/2003 4,715 4,818 4.750% due 11/14/2003 730 731 7.400% due 07/01/2004 600 644 7.000% due 07/15/2005 33,790 36,121 7.375% due 05/22/2006 500 502 6.000% due 05/15/2008 200 206 6.200% due 07/28/2008 1,000 999 6.000% due 09/24/2008 1,000 992 6.100% due 02/04/2009 1,000 993 6.375% due 06/15/2009 450 471 6.625% due 09/15/2009 1,060 1,125 Federal Home Loan Bank 5.125% due 09/15/2003 200 202 5.135% due 09/22/2003 500 503 5.365% due 12/11/2008 400 392 0.000% due 07/27/2018 2,900 876 Freddie Mac 6.542% due 03/19/2008 1,000 1,001 6.500% due 07/14/2008 1,950 1,953 5.125% due 10/15/2008 640 622 6.625% due 09/15/2009 250 265 6.890% due 03/01/2011 500 501 Small Business Administration 7.449% due 08/01/2010 4,691 4,950 ------------- Total U.S. Government Agencies 58,983 (Cost $57,600) ------------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 15.7% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (i) 3.625% due 07/15/2002 (b) 59,804 60,982 3.375% due 01/15/2007 4,531 4,581 3.625% due 01/15/2008 8,779 8,985 3.875% due 01/15/2009 14,712 15,300 3.625% due 04/15/2028 4,655 4,747 3.875% due 04/15/2029 37,279 39,797 U.S. Treasury Bonds 10.625% due 08/15/2015 13,200 19,990 8.750% due 08/15/2020 28,000 38,414 8.125% due 08/15/2021 1,400 1,825 6.250% due 08/15/2023 13,800 14,881 U.S. Treasury Notes 5.625% due 05/15/2008 140 146 5.750% due 11/15/2005 (j) 16,500 17,307 U.S. Treasury Strips 0.000% due 08/15/2025 2,400 594 0.000% due 02/15/2014 20,600 10,207 0.000% due 02/15/2019 13,500 4,834 0.000% due 11/15/2021 24,200 7,356 0.000% due 11/15/2024 58,000 14,927 ------------- Total U.S. Treasury Obligations 264,873 (Cost $256,399) ------------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 76.4% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 10.1% Bear Stearns Adjustable Rate Mortgage Trust 7.500% due 12/25/2030 (d) 5,773 5,839 Chase Mortgage Finance Corp. 7.000% due 07/25/2028 4,655 4,673 COMM 6.145% due 02/15/2008 4,199 4,260 Dime Savings 7.177% due 11/01/2018 (d) 55 51 DLJ Mortgage Acceptance Corp. 11.000% due 08/01/2019 115 128 Fannie Mae 6.000% due 06/25/2001 5 5 6.150% due 09/25/2016 1,078 1,078 9.000% due 06/25/2018 14 15 6.000% due 09/25/2018 60 60 9.250% due 07/25/2019 1,821 1,944 6.000% due 08/25/2020 2,377 2,378 7.000% due 09/25/2020 38 38 6.500% due 05/18/2023 6,382 6,428 Freddie Mac 5.950% due 07/15/2003 102 103 11.875% due 06/15/2013 109 119 8.800% due 12/01/2015 181 189 9.250% due 11/15/2019 23 24 9.000% due 12/15/2020 923 974 7.000% due 07/15/2022 17,609 17,618 7.500% due 01/15/2023 18,301 18,954 6.750% due 04/25/2024 9,451 9,342 8.000% due 06/15/2030 7,962 8,463 Guaranteed Mortgage Corp. 9.300% due 07/20/2019 351 375 Independent National Mortgage Corp. 8.639% due 11/25/2024 (d) 184 185 Mellon Residential Funding Corp. 6.570% due 07/25/2029 (d) 4,000 4,079 Nationslink Funding Corp. 6.654% due 02/10/2006 3,000 3,095 5.921% due 04/10/2007 (d) 2,377 2,377 Norwest Asset Securities Corp. 7.500% due 03/25/2027 17,000 17,463 88 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- PNC Mortgage Securities Corp. 7.750% due 08/25/2030 $ 21,285 $ 21,852 Residential Accredit Loans, Inc. 7.250% due 11/25/2027 10,083 10,243 Residential Funding Mortgage Securities I 7.000% due 11/25/2027 12,115 12,302 Salomon Brothers Mortgage Securities VII 6.093% due 04/25/2029 (d) 10,888 10,927 7.600% due 11/25/2030 5,179 5,288 ------------- 170,869 ------------- Fannie Mae 3.1% 6.000% due 01/01/2011-04/16/2031 (e) 1,363 1,340 6.500% due 02/01/2013 250 254 7.000% due 08/01/2009-05/01/2030 (e) 829 848 7.500% due 03/01/2030-06/01/2030 (e) 611 625 7.508% due 09/01/2040 (d) 42,510 43,756 7.750% due 10/01/2007 111 114 8.000% due 05/01/2002-10/01/2030 (e) 422 436 8.178% due 07/01/2020 (d) 692 707 8.197% due 02/01/2023 (d) 1,294 1,299 8.296% due 12/01/2023 (d) 490 505 8.363% due 01/01/2024 (d) 802 827 8.500% due 12/01/2001-04/01/2017 (e) 964 987 8.896% due 04/01/2024 (d) 821 836 9.000% due 12/01/2001-06/01/2010 (e) 146 151 11.000% due 09/01/2010 130 143 13.750% due 10/01/2010-11/01/2013 (e) 84 96 14.500% due 03/01/2013 3 3 14.750% due 10/01/2012 8 9 ------------- 52,936 ------------- Federal Housing Administration 1.2% 5.595% due 10/01/2019 352 351 6.000% due 03/20/2028 20,110 19,641 8.828% due 05/01/2019 200 206 ------------- 20,198 ------------- Freddie Mac 1.3% 6.000% due 09/01/2027-10/01/2029 (e) 94 92 6.500% due 12/01/2010 325 332 7.000% due 03/01/2007-05/14/2031 (e) 7,014 7,095 7.250% due 03/01/2006 98 99 7.500% due 08/01/2009 7 7 7.813% due 07/01/2030 (d) 9,977 10,460 7.919% due 02/01/2023 (d) 444 449 8.000% due 07/01/2030 112 116 8.250% due 03/01/2008-05/01/2008 (e) 64 66 8.500% due 12/01/2001 0 0 8.538% due 12/01/2022 (d) 3,603 3,704 9.500% due 02/01/2011 41 44 10.000% due 06/01/2011-03/01/2021 (e) 91 99 10.500% due 04/01/2001 1 1 15.500% due 06/01/2011 0 1 ------------- 22,565 ------------- Government National Mortgage Association 60.7% 6.000% due 07/15/2028-04/23/2031 (e) 87,274 85,588 6.500% due 01/15/2024-05/21/2031 (d)(e) 362,568 362,448 6.650% due 11/15/2030 15,913 15,674 7.000% due 12/20/2029-05/21/2031 (d)(e) 500,265 507,943 7.375% due 06/20/2023-06/20/2027 (d)(e) 20,904 21,206 7.500% due 03/15/2024 158 163 7.750% due 09/20/2024-08/20/2027 (d)(e) 28,948 29,632 8.000% due 06/15/2024-12/15/2030 (e) 1,387 1,441 8.500% due 04/15/2030 268 279 12.000% due 01/15/2013-06/15/2015 (e) 15 18 1,024,392 ------------- Total Mortgage-Backed Securities 1,290,960 (Cost $1,283,147) ------------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 5.3% -------------------------------------------------------------------------------- Advanta Equipment Receivables 7.560% due 02/15/2007 2,294 2,357 AFC Home Equity Loan Trust 7.807% due 10/25/2026 (d) 1 1 Americredit Automobile Receivable Trust 5.440% due 06/12/2005 (d) 5,000 5,006 Banc One Auto Grantor Trust 6.270% due 11/20/2003 1,555 1,561 Bayview Financial Acquisition Trust 6.103% due 07/25/2030 (d) 2,769 2,769 Comed Transitional Funding Trust 5.290% due 06/25/2003 575 576 Conseco Finance 7.890% due 07/15/2018 20,000 20,947 8.170% due 12/15/2025 11,800 12,411 Conseco Finance Lease LLC 7.250% due 04/20/2003 19,400 19,607 Delta Funding Home Equity Loan Trust 7.260% due 08/25/2018 3,980 4,027 Green Tree Recreational, Equipment, & Consumables 6.430% due 04/17/2006 1,418 1,431 Residential Asset Mortgage Products, Inc. 7.610% due 12/25/2027 9,325 9,708 SallieMae 5.804% due 04/25/2004 (d) 1,337 1,339 Sasco Floating Rate Commercial Mortgage Trust 7.200% due 02/25/2001 (d) 1,079 1,079 Summit Acceptance Auto Receivables Trust 7.150% due 02/18/2003 7,038 7,089 ------------- Total Asset-Backed Securities 89,908 (Cost $87,631) ------------- -------------------------------------------------------------------------------- PREFERRED STOCK 0.1% -------------------------------------------------------------------------------- Shares Fortis Amev NV 6.430% due 12/31/2049 6 792 5.080% due 12/31/2049 (d) 6 792 ------------- Total Preferred Stock 1,584 (Cost $1,450) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 10.5% -------------------------------------------------------------------------------- Principal Amount (000s) Commercial Paper 9.9% American Express Credit Corp. 5.150% due 04/04/2001 $ 10,000 9,997 Anheuser Busch, Inc. 5.280% due 04/03/2001 6,600 6,599 Executive Jet, Inc. 5.280% due 06/27/2001 21,000 20,754 Fannie Mae 4.685% due 09/06/2001 15,800 15,472 Freddie Mac 5.070% due 04/03/2001 200 200 General Electric Capital Corp. 5.430% due 04/04/2001 3,500 3,499 5.470% due 04/18/2001 200 200 4.900% due 04/25/2001 5,000 4,984 4.690% due 05/30/2001 1,800 1,786 4.870% due 05/30/2001 8,600 8,533 4.940% due 05/30/2001 1,000 992 5.290% due 06/06/2001 5,000 4,954 4.930% due 08/22/2001 14,000 13,734 National Rural Utilities Cooperative Finance Corp. 5.280% due 04/19/2001 3,800 3,791 4.820% due 05/24/2001 1,800 1,787 5.340% due 05/24/2001 9,500 9,427 4.910% due 05/25/2001 10,500 10,424 UBS Finance, Inc. 5.300% due 04/04/2001 400 400 5.190% due 06/06/2001 1,200 1,189 4.940% due 06/13/2001 10,000 9,900 5.050% due 08/01/2001 5,000 4,918 5.040% due 08/02/2001 800 787 5.040% due 08/15/2001 28,000 27,493 5.050% due 08/15/2001 5,000 4,909 ------------- 166,729 ------------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 89 Schedule of Investments (Cont.) Total Return Fund II March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Repurchase Agreement 0.6% State Street Bank 4.600% due 04/02/2001 $ 9,730 $ 9,730 ------------ (Dated 03/30/2001. Collateralized by Federal Farm Credit Bank 5.450% due 01/23/2003 valued at $9,929. Repurchase proceeds are $9,734.) U.S. Treasury Bills (b) 0.0% 4.470% due 05/17/2001 120 119 ------------ Total Short-Term Instruments 176,578 (Cost $176,527) ------------ Total Investments (a) 149.0% $ 2,516,683 (Cost $2,488,975) Written Options (c) (0.0%) (794) (Premiums $762) Other Assets and Liabilities (Net) (49.0%) (831,708) ------------ Net Assets 100.0% $ 1,684,181 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $2,489,026 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 29,529 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (1,872) ------------ Unrealized appreciation-net $ 27,657 ------------ (b) Securities with an aggregate market value of $5,917 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 5 Year Note (06/2001) 269 $ (170) U.S. Treasury 10 Year Note (06/2001) 117 33 U.S. Treasury 30 Year Bond (06/2001) 1,094 (138) Municipal Bond (06/2001) 54 (36) Eurodollar March Futures (03/2002) 31 17 Eurodollar June Futures (06/2002) 436 48 Eurodollar September Futures (09/2002) 436 41 Eurodollar December Futures (12/2002) 436 27 Eurodollar March Futures (03/2003) 405 8 ------------ $ (170) ------------ (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - CME Eurodollar December Futures Strike @ 95.25 Exp. 12/17/2001 384 $ 192 $ 192 Call - CBOT U.S. Treasury Note June Futures Strike @ 107.00 Exp. 05/26/2001 77 49 65 Put - CME Eurodollar December Futures Strike @ 95.00 Exp. 12/17/2001 68 29 20 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 571 311 312 Put - CBOT U.S. Treasury Note June Futures Strike @ 105.00 Exp. 05/26/2001 320 181 205 ----------------- $ 762 $ 794 ----------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Securities are grouped together by coupon or range of coupons and represent a range of maturities. (f) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2006 $ 137,300 $ 2,042 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 06/15/2006 133,600 1,689 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Bank of America Exp. 06/15/2006 63,800 (85) Receive fixed rate equal to 0.410% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Goldman Sachs Exp. 11/10/2002 9,000 1 Receive fixed rate equal to 0.500% and the Fund will pay to the counterparty at par in the event of default of Williams Companies, Inc. 6.625% due 11/15/2004. Broker: Warburg Dillon Read LLC Exp. 09/16/2003 20,000 1 ------------ $ 3,648 ------------ (g) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy JY 21,528 04/2001 $ (7) Sell 21,528 04/2001 10 ------------ $ 3 ------------ (h) Principal amount denoted in indicated currency: JY - Japanese Yen (i) Principal amount of the security is adjusted for inflation. (j) Subject to financing transaction. 90 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments Total Return Fund III March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 28.6% -------------------------------------------------------------------------------- Banking & Finance 17.4% Abbey National Capital Trust I 8.963% due 12/29/2049 $ 9,300 $ 10,313 ABN AMRO Mortgage Corp. 7.000% due 04/01/2008 1,000 1,040 Allied Irish Banks 5.842% due 10/31/2006 (d) 7,000 7,010 Associates Corp. of North America 7.240% due 05/17/2006 1,000 1,060 BankBoston Corp. 6.125% due 03/15/2002 15,000 15,152 Bear Stearns Co., Inc. 5.370% due 12/16/2002 (d) 10,000 10,017 Export-Import Bank Korea 7.250% due 06/25/2001 1,570 1,574 7.100% due 03/15/2007 50 52 Ford Motor Credit Co. 7.058% due 07/16/2002 (d) 300 300 5.750% due 02/23/2004 1,500 1,499 6.125% due 03/20/2004 500 505 7.500% due 03/15/2005 30,000 31,413 6.620% due 02/27/2006 1,000 1,017 General Motors Acceptance Corp. 5.923% due 07/21/2003 (d) 6,500 6,510 5.998% due 07/21/2004 (d) 6,200 6,144 Gold Eagle Capital Ltd. 12.198% due 04/15/2001 (d) 6,000 6,000 Household Finance Corp. 5.535% due 05/07/2002 (d) 5,000 4,977 5.545% due 05/24/2002 (d) 500 501 Inter-American Development Bank 5.375% due 01/18/2006 7,600 7,628 International Lease Finance Corp. 5.450% due 01/04/2002 500 503 Korea Development Bank 7.900% due 02/01/2002 1,875 1,903 7.625% due 10/01/2002 2,250 2,302 Morgan Stanley, Dean Witter & Co. 6.375% due 08/01/2002 1,000 1,019 NationsBank Corp. 8.625% due 11/15/2003 25 27 Residential Reinsurance 10.926% due 06/01/2001 (d) 4,200 4,200 Spieker Properties, Inc. 6.950% due 12/15/2002 2,000 2,040 Textron Financial Corp. 7.098% due 05/28/2002 (d) 5,000 4,994 Tokai Capital Corp. 9.980% due 12/29/2049 (d) 200 167 Wachovia Corp. 6.075% due 05/02/2005 (d) 10,000 9,988 Westdeutsche Landesbank 6.050% due 01/15/2009 1,800 1,775 Western Capital 10.665% due 01/07/2003 11,800 11,807 ------------- 153,437 ------------- Industrials 3.7% Cargill, Inc. 6.871% due 01/14/2002 (d) 9,000 9,003 DaimlerChrysler North America Holding Corp. 7.250% due 01/18/2006 900 923 Fred Meyer, Inc. 7.150% due 03/01/2003 50 52 General Motors Corp. 9.125% due 07/15/2001 20 20 International Paper Co. 6.666% due 07/08/2002 (d) 2,200 2,202 Petroleos Mexicanos 7.768% due 07/15/2005 (d) 5,000 5,013 Time Warner, Inc. 6.100% due 12/30/2001 10,000 10,040 Waste Management, Inc. 6.700% due 05/01/2001 5,500 5,501 ------------- 32,754 ------------- Utilities 7.5% Arizona Public Service Co. 6.108% due 11/15/2001 (d) 5,300 5,305 Bell Atlantic Pennsylvania, Inc. 7.375% due 07/15/2007 75 80 British Telecommunications PLC 7.625% due 12/15/2005 8,300 8,597 8.125% due 12/15/2010 (d) 1,700 1,776 Deutsche Telekom AG 7.750% due 06/15/2005 900 930 Niagara Mohawk Power Co. 7.125% due 07/01/2001 4,990 5,011 7.250% due 10/01/2002 11,341 11,581 7.375% due 07/01/2003 3,024 3,102 Oneok, Inc. 7.411% due 04/24/2002 (d) 13,000 13,022 Texas Utilities Corp. 6.375% due 10/01/2004 1,000 1,012 WorldCom, Inc. 6.125% due 08/15/2001 5,000 5,009 8.875% due 01/15/2006 10,000 10,328 ------------- 65,753 ------------- Total Corporate Bonds & Notes 251,944 (Cost $247,892) ------------- -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.6% -------------------------------------------------------------------------------- Texas 0.6% Harris County Health Facilities Development Corporation Revenue, Series 1999 5.375% due 07/01/2029 5,100 5,037 ------------- Total Municipal Bonds & Notes 5,037 (Cost $4,785) ------------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 2.1% -------------------------------------------------------------------------------- Federal Home Loan Bank 7.620% due 03/08/2005 15,000 15,421 Freddie Mac 8.000% due 01/01/2012 142 147 Small Business Administration 7.449% due 08/01/2010 2,395 2,528 ------------- Total U.S. Government Agencies 18,096 (Cost $17,898) ------------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 12.4% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (j) 3.625% due 07/15/2002 (b) 16,837 17,168 3.375% due 01/15/2007 14,367 14,525 3.625% due 01/15/2008 9,538 9,761 3.875% due 01/15/2009 14,307 14,879 3.625% due 04/15/2028 2,490 2,539 3.875% due 04/15/2029 8,096 8,643 U.S. Treasury Bonds 7.875% due 02/15/2021 900 1,143 6.000% due 02/15/2026 14,800 15,522 U.S. Treasury Notes 6.750% due 05/15/2005 11,900 12,867 U.S. Treasury Strips 0.000% due 02/15/2014 5,000 2,477 0.000% due 02/15/2015 6,500 3,009 0.000% due 11/15/2024 25,100 6,460 ------------- Total U.S. Treasury Obligations 108,993 (Cost $105,680) ------------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 74.6% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 23.1% ABN AMRO Mortgage Corp. 6.750% due 11/25/2028 9,750 9,679 Amortizing Residential Collateral Trust 5.790% due 09/25/2030 (d) 3,536 3,539 Bear Stearns Adjustable Rate Mortgage Trust 7.499% due 12/25/2030 (d) 21,109 21,348 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 91 Schedule of Investments (Cont.) Total Return Fund III March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CMC Securities Corp. II 8.447% due 04/25/2025 (d) $ 548 $ 547 DLJ Mortgage Acceptance Corp. 7.580% due 02/12/2006 (d) 13,600 14,401 Fannie Mae 6.500% due 12/18/2004 3,149 3,186 7.000% due 09/25/2021 6,591 6,781 Freddie Mac 6.500% due 08/15/2023 6,446 6,499 5.813% due 03/15/2025 (d) 12,778 12,818 7.000% due 02/15/2027 14,492 14,687 6.500% due 09/01/2028 60 60 6.500% due 06/01/2029 91 90 6.805% due 08/15/2032 (d) 5,259 5,390 General Electric Capital Mortgage Services, Inc. 6.750% due 12/25/2012 2,198 2,217 7.500% due 03/25/2027 15,000 15,408 6.000% due 07/25/2029 10,400 10,431 Government National Mortgage Association 6.482% due 02/16/2030 (d) 2,233 2,237 Greenwich Capital Acceptance, Inc. 9.686% due 11/25/2024 (d) 5 5 Impac Secured Assets Owner Trust 7.750% due 10/25/2030 11,586 11,840 Norwest Asset Securities Corp. 6.250% due 12/25/2028 12,554 11,659 PNC Mortgage Securities Corp. 6.500% due 12/25/2028 6,449 6,265 Residential Accredit Loans, Inc. 7.050% due 01/25/2026 1,807 1,813 7.250% due 01/25/2026 3,000 3,059 6.500% due 12/25/2028 24,000 23,536 Residential Funding Mortgage Securities I 7.750% due 10/25/2030 5,097 5,239 Resolution Trust Corp. 8.835% due 12/25/2023 730 739 6.950% due 05/25/2029 (d) 985 985 Structured Asset Mortgage Investments, Inc. 6.580% due 06/25/2029 (d) 8,904 9,045 ------------- 203,503 ------------- Fannie Mae 2.3% 6.252% due 08/01/2018 (d) 82 83 6.446% due 02/01/2031 (d) 56 57 6.500% due 04/16/2031 8,500 8,465 7.430% due 01/25/2023 7,299 7,293 7.500% due 02/01/2027 3,665 3,774 8.250% due 07/01/2017 48 50 8.500% due 02/01/2007 107 109 9.000% due 07/01/2005-06/01/2025 (g) 22 23 ------------- 19,854 ------------- Federal Housing Administration 0.9% 7.430% due 11/25/2019-11/25/2022 (g) 7,651 7,631 ------------- Freddie Mac 9.1% 6.750% due 10/01/2006 29 29 7.000% due 11/01/2011-05/14/2031 (g) 75,018 75,940 7.500% due 07/01/2011 312 322 7.813% due 07/01/2030 (d) 2,918 3,059 8.000% due 02/01/2006-03/01/2028 (g) 145 151 8.540% due 12/01/2022 (d) 580 596 ------------- 80,097 ------------- Government National Mortgage Association 39.2% 1.000% due 11/01/2039 295 307 6.000% due 02/15/2029-04/23/2031 (g) 21,245 20,875 6.500% due 09/15/2023-05/21/2031 (d)(g) 224,761 224,641 7.000% due 04/23/2031 74,000 75,157 7.375% due 06/20/2022-01/20/2026 (d)(g) 6,031 6,124 7.400% due 10/15/2001 6,715 6,956 7.620% due 10/20/2024-12/20/2026 (d)(g) 5,176 5,306 7.750% due 09/20/2023-08/20/2027 (d)(g) 4,930 5,049 10.250% due 02/15/2017 608 651 12.750% due 02/20/2015 4 5 ------------- 345,071 ------------- Stripped Mortgage-Backed Securities 0.0% Freddie Mac (IO) 6.500% due 04/15/2022 1,240 119 ------------- Total Mortgage-Backed Securities 656,275 (Cost $650,904) ------------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 5.4% -------------------------------------------------------------------------------- Advanta Mortgage Loan Trust 5.450% due 08/25/2029 (d) 12,305 12,353 Green Tree Financial Corp. 7.860% due 04/01/2031 600 614 Green Tree Recreational, Equipment, & Consumables 6.430% due 04/17/2006 1,233 1,245 NPF XII, Inc. 7.050% due 06/01/2003 3,000 3,044 PP&L Transition Bond Co. LLC 6.410% due 12/26/2003 7,356 7,399 Public Service 1.500% due 04/01/2001 11,500 11,500 SallieMae 6.602% due 04/25/2004 (d) 446 446 6.487% due 10/25/2005 (d) 2,921 2,919 5.901% due 10/25/2005 (d) 8,019 8,020 ------------- Total Asset-Backed Securities 47,540 (Cost $47,336) ------------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 2.2% -------------------------------------------------------------------------------- Province of Quebec 8.800% due 04/15/2003 1,000 1,076 Republic of Brazil 7.375% due 04/15/2006 (d) 8,765 7,944 Republic of Croatia 6.250% due 07/31/2010 (d) 2,425 2,343 Republic of Korea 8.750% due 04/15/2003 900 956 Republic of Panama 9.625% due 02/08/2011 7,550 7,493 ------------- Total Sovereign Issues 19,812 (Cost $19,833) ------------- -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES (h)(i) 7.8% -------------------------------------------------------------------------------- British Telecom PLC 4.726% due 07/27/2001 (d) EC 10,000 8,786 France Telecom 4.587% due 10/11/2001 (d) 10,000 8,785 Halifax Group Euro Finance 7.627% due 12/29/2049 9,700 9,001 Koninklijke PTT NV 5.013% due 06/13/2001 (d) 8,000 7,030 Nationwide Building Society 4.629% due 03/27/2003 (d) 10,000 8,793 Republic of Austria 5.500% due 01/15/2010 (f) 1,600 1,457 Republic of Germany 5.375% due 01/04/2010 (f) 1,000 927 5.250% due 07/04/2010 (f) 4,320 3,962 5.250% due 01/04/2011 (f) 4,310 3,952 6.250% due 01/04/2024 (f) 570 558 6.500% due 07/04/2027 (f) 2,300 2,325 6.250% due 01/04/2030 (f) 980 973 Royal Bank of Scotland Group PLC 0.000% due 12/01/2003 BP 6,000 7,351 UK Gilt 9.000% due 08/06/2012 2,400 4,637 ------------- Total Foreign Currency-Denominated Issues 68,537 (Cost $69,350) ------------- 92 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Government National Mortgage Association (OTC) 8.000% due 06/20/2031 Strike @ 98.000 Exp. 06/13/2001 $ 0 $ 0 ------------ Total Purchased Put Options 0 (Cost $1) ------------ -------------------------------------------------------------------------------- PREFERRED STOCK 0.4% -------------------------------------------------------------------------------- Shares TCI Communications, Inc. 9.720% due 12/31/2036 132,000 3,358 ------------ Total Preferred Stock 3,358 (Cost $3,676) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 6.1% -------------------------------------------------------------------------------- Principal Amount (000s) Commercial Paper 5.5% Abbey National North America 5.010% due 08/08/2001 $ 5,300 5,208 Coca Cola Co. 4.600% due 07/12/2001 600 592 Fannie Mae 4.700% due 05/16/2001 1,500 1,491 Federal Farm Credit Bank 4.630% due 08/29/2001 4,300 4,215 General Electric Capital Corp. 5.310% due 06/06/2001 800 793 Swedbank, Inc. 4.930% due 04/25/2001 2,000 1,994 5.020% due 08/08/2001 9,500 9,336 UBS Finance, Inc. 4.750% due 09/05/2001 14,400 14,103 4.740% due 09/06/2001 11,000 10,772 ------------ 48,504 ------------ Repurchase Agreement 0.6% State Street Bank 4.600% due 04/02/2001 5,283 5,283 (Dated 03/30/2001. Collateralized by Federal Home Loan Bank 5.875% due 08/15/2001 valued at $5,389 Repurchase proceeds are $5,285.) ------------ Total Short-Term Instruments 53,787 (Cost $53,783) ------------ Total Investments (a) 140.2% $ 1,233,379 (Cost $1,221,138) Written Options (c) (0.1%) (918) (Premiums $790) Other Assets and Liabilities (Net) (40.1%) (352,481) ------------ Net Assets 100.0% $ 879,980 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,221,461 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 15,714 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (3,796) ------------ Unrealized appreciation-net $ 11,918 ------------ (b) Securities with an aggregate market value of $5,686 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- Municipal Bond (06/2001) 1 $ (1) EuroBond 10 Year Note (06/2001) 826 646 U.S. Treasury 2 Year Note (06/2001) 1 (1) U.S. Treasury 5 Year Note (06/2001) 119 7 U.S. Treasury 10 Year Note (06/2001) 35 (9) U.S. Treasury 30 Year Bond (06/2001) 469 (338) Euribor Futures (06/2001) 6 11 Euribor Futures (03/2002) 79 84 Government of Japan 10 Year Note (06/2001) 3 (2) Eurodollar September Futures (09/2002) 94 4 Eurodollar March Futures (03/2003) 94 (3) Eurodollar June Futures (06/2002) 94 6 Eurodollar December Futures (12/2002) 94 0 ------------ $ 404 ------------ (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - CME Eurodollar December Futures Strike @ 95.00 Exp. 12/17/2001 36 $ 15 $ 10 Call - CBOT U.S. Treasury Note June Futures Strike @ 107.00 Exp. 05/26/2001 41 26 35 Put - CME Eurodollar December Futures Strike @ 95.25 Exp. 12/17/2001 200 100 100 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 297 162 162 Put - CBOT U.S. Treasury Note June Futures Strike @ 105.00 Exp. 05/26/2001 161 91 103 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/25/2001 4,000,000 38 70 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/25/2001 2,000,000 19 35 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 1,800,000 16 33 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/31/2001 3,600,000 33 66 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 5,400,000 52 98 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 06/04/2001 5,200,000 31 99 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/21/2001 1,700,000 52 23 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/22/2001 2,100,000 62 29 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 11/27/2001 1,700,000 49 24 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 12/03/2001 2,100,000 44 31 ------------------- $ 790 $ 918 ------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 93 Schedule of Investments (Cont.) Total Return Fund III March 31, 2001 -------------------------------------------------------------------------------- (e) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.295%. Broker: Goldman Sachs JY 580,000 $ (430) Exp. 04/14/2008 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.305%. Broker: Goldman Sachs 377,000 (282) Exp. 04/15/2002 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.669%. Broker: Goldman Sachs 1,250,000 (519) Exp. 05/08/2007 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2006 $ 10,900 158 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 06/15/2006 48,900 610 Receive fixed rate equal to 5.670% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 01/08/2004 BP 9,000 65 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.771%. Broker: Morgan Stanley Exp. 01/11/2011 JY 685,000 (225) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.777%. Broker: Goldman Sachs Exp. 01/12/2011 1,281,000 (426) Receive fixed rate equal to 5.560% and pay floating rate based on 6-month BP-LIBOR Broker: Morgan Stanley Exp. 02/27/2003 BP 65,600 169 Receive fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR Broker: Goldman Sachs Exp. 03/02/2004 21,800 98 Receive fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR Broker: Lehman Brothers Exp. 03/02/2004 11,800 53 Receive fixed rate equal to 5.471% and pay floating rate based on 6-month BP-LIBOR Broker: Goldman Sachs Exp. 03/15/2006 BP 11,900 82 Receive fixed rate equal to 5.484% and pay floating rate based on 6-month BP-LIBOR Broker: J.P. Morgan Exp. 03/15/2006 BP 6,200 47 Receive fixed rate equal to 5.421% and pay floating rate based on 6-month BP-LIBOR Broker: Lehman Brothers Exp. 03/15/2006 3,000 8 Receive fixed rate equal to 5.305% and pay floating rate based on 6-month BP-LIBOR Broker: Goldman Sachs Exp. 03/19/2006 8,900 (8) Receive floating rate based on 6-month BP-LIBOR and pay a fixed rate equal to 5.215%. Broker: Goldman Sachs Exp. 09/19/2002 8,900 (3) Receive fixed rate equal to 5.207% and pay floating rate based on 6-month BP-LIBOR Broker: Morgan Stanley Exp. 03/15/2004 8,200 (7) Receive fixed rate equal to 0.510% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 01/25/2005 $ 5,000 0 Receive a fixed rate equal to 0.250% and the Fund will pay to the counterparty at par in the event of default of CIT Group, Inc. 7.125% due 10/15/2004. Broker: Lehman Brothers Exp. 04/11/2003 25,000 1 ------------ $ (609) ------------ (f) Subject to financing transaction. (g) Securities are grouped by coupon or range of coupons and represent a range of maturities. (h) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Sell BP 5,249 05/2001 $ 259 Buy EC 6,000 04/2001 (187) Sell 27,683 04/2001 1366 Sell 21,746 06/2001 73 Buy 21,746 04/2001 (70) Buy JY 1,982,000 04/2001 (394) Sell 1,982,000 04/2001 279 Sell 1,982,000 06/2001 389 ----------- $ 1,715 ----------- (i) Principal amount denoted in indicated currency: BP - British Pound EC - Euro JY - Japanese Yen (j) Principal amount of the security is adjusted for inflation (k) Short sales open at March 31, 2001 were as follows: Type Coupon (%) Maturity Par Value Proceeds -------------------------------------------------------------------------------- U.S. Treasury Notes 5.750 10/02/2002 16,200 $ 16,586 $ 16,537 U.S. Treasury Notes 6.750 05/05/2005 57,400 62,063 61,665 UK Gilt 9.000 08/06/2012 2,400 4,638 4,772 -------------------- $ 83,287 $ 82,974 -------------------- 94 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments Moderate Duration Fund March 31, 2001 Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 22.0% -------------------------------------------------------------------------------- Banking & Finance 8.9% Bear Stearns Co., Inc 6.788% due 03/28/2003 (d) $ 2,900 $ 2,899 Beaver Valley Funding Corp. 8.250% due 06/01/2003 188 193 CIT Group, Inc. 6.375% due 08/01/2002 850 860 Ford Motor Credit Co. 6.895% due 01/17/2002 (d) 5,000 4,996 5.750% due 02/23/2004 4,300 4,298 6.125% due 03/20/2004 1,300 1,312 General Motors Acceptance Corp 5.450% due 09/15/2003 1,000 996 6.150% due 04/05/2007 350 342 Gold Eagle Capital Ltd. 11.078% due 04/15/2001 (d) 3,500 3,500 Household Finance Corp. 6.125% due 02/27/2003 3,000 3,024 Lehman Brothers Holdings, Inc. 6.375% due 05/07/2002 600 608 National Rural Utilities Cooperative Finance Corp. 5.721% due 08/13/2002 (d) 10,000 10,002 Nationsbank Corp. 6.078% due 04/15/2003 (d) 5,000 5,016 PSEG Capital Corp. 6.740% due 10/23/2001 1,100 1,111 Royal Bank of Scotland Group PLC 8.817% due 03/31/2049 3,600 3,900 Salomon, Smith Barney Holdings 5.891% due 07/23/2002 (d) 2,000 2,000 Sears Roebuck Acceptance Corp. 6.720% due 10/23/2002 3,000 3,043 Wells Fargo & Co. 6.025% due 05/02/2005 (d) 3,200 3,197 ------------- 51,297 ------------- Industrials 2.1% AMERCO 7.230% due 01/21/2027 500 483 Cargill, Inc. 5.818% due 01/14/2002 (d) 5,000 5,002 Eli Lilly & Co. 6.250% due 03/15/2003 100 102 HNA Holdings, Inc. 6.125% due 02/01/2004 150 155 Occidental Petroleum Corp. 6.400% due 04/01/2003 2,600 2,618 Philip Morris Cos., Inc. 7.250% due 09/15/2001 850 856 7.125% due 08/15/2002 100 102 TCI Communications, Inc. 5.520% due 04/03/2002 (d) 250 249 7.550% due 09/02/2003 500 523 Waste Management, Inc. 6.375% due 12/01/2003 2,000 2,004 ------------- 12,094 ------------- Utilities 11.0% British Telecommunications PLC 7.625% due 12/15/2005 6,200 6,422 Central Power & Light Co. 7.350% due 11/23/2001 (d) 10,000 10,012 Cincinnati Gas & Electric Co. 6.350% due 06/15/2003 1,200 1,213 CMS Energy Corp. 8.125% due 05/15/2002 750 760 DTE Capital Corp. 7.110% due 11/15/2038 (d) 7,710 7,872 GTE Corp. 6.540% due 12/01/2005 7,050 7,279 New York Telephone Co. 6.250% due 02/15/2004 100 102 Potomac Edison Co. 8.000% due 06/01/2006 1,000 1,014 Reliant Energy Resources 8.125% due 07/15/2005 10,000 10,475 SBC Communications Capital Corp. 6.375% due 04/01/2001 350 350 Southern California Edison Co. 6.375% due 01/15/2006 100 78 System Energy Resources, Inc. 7.710% due 08/01/2001 2,900 2,922 Tennessee Valley Authority 6.375% due 06/15/2005 250 261 Texas Utilities Corp. 7.013% due 06/25/2001 (d) 10,000 9,999 7.388% due 09/24/2001 (d) 5,000 4,986 ------------- 63,745 ------------- Total Corporate Bonds & Notes 127,136 (Cost $124,956) ------------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 7.9% -------------------------------------------------------------------------------- Fannie Mae 6.000% due 03/11/2003 400 409 6.350% due 06/10/2005 200 209 5.750% due 06/15/2005 250 255 7.000% due 07/15/2005 510 545 5.875% due 02/02/2006 200 206 6.625% due 03/21/2006 50 53 6.625% due 10/15/2007 1,195 1,273 6.625% due 09/15/2009 2,000 2,123 6.625% due 11/15/2010 1,045 1,113 Farmer Mac 5.860% due 03/03/2006 400 410 Federal Farm Credit Bank 5.600% due 01/30/2002 250 252 4.800% due 11/06/2003 250 250 5.750% due 03/05/2004 250 256 5.950% due 05/18/2005 500 514 Federal Home Loan Bank 5.755% due 06/24/2003 250 256 6.070% due 06/30/2003 100 103 5.415% due 02/24/2004 400 407 5.485% due 03/23/2004 400 407 6.340% due 06/13/2005 400 417 6.060% due 05/24/2006 350 363 5.890% due 08/11/2008 500 510 5.800% due 09/02/2008 750 759 6.225% due 04/13/2009 400 404 6.120% due 05/21/2009 350 360 Freddie Mac 7.375% due 05/15/2003 600 633 7.000% due 07/15/2005 850 909 Small Business Administration 7.449% due 08/01/2010 15,000 15,827 6.640% due 02/01/2011 16,000 16,103 ------------- Total U.S. Government Agencies 45,326 (Cost $43,787) ------------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 8.0% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (h) 3.625% due 07/15/2002 (b) 9,403 9,588 3.375% due 01/15/2007 5,084 5,139 3.625% due 01/15/2008 1,951 1,997 3.875% due 01/15/2009 27,439 28,537 U.S. Treasury Notes 7.000% due 07/15/2006 660 731 U.S. Treasury Strips 0.000% due 11/15/2021 1,200 365 ------------- Total U.S. Treasury Obligations 46,357 (Cost $45,964) ------------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 95 Schedule of Investments (Cont.) Moderate Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 93.4% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 33.7% Chase Mortgage Finance Corp. 7.372% due 04/25/2025 (d) $ 1,487 $ 1,518 7.000% due 04/25/2025 293 295 Criimi Mae Financial Corp. 7.000% due 01/01/2033 10,874 10,980 Fannie Mae 6.250% due 04/25/2007 642 644 6.250% due 06/25/2007 63 63 6.000% due 03/25/2009 1,490 1,425 6.750% due 11/25/2010 2,730 2,739 6.500% due 01/18/2019 1,194 1,200 6.350% due 03/25/2019 1,426 1,429 7.000% due 10/25/2020 112 114 6.850% due 06/25/2021 135 137 6.500% due 08/25/2021 28,509 28,686 7.000% due 09/25/2021 3,244 3,338 6.750% due 11/25/2021 150 154 5.750% due 12/20/2027 9,759 8,944 6.500% due 05/18/2028 31 31 Freddie Mac 7.000% due 10/15/2001 115 115 5.500% due 06/15/2003 197 197 7.000% due 05/15/2004 9,082 9,221 7.000% due 06/15/2005 15 15 7.000% due 11/15/2005 400 409 7.000% due 06/15/2006 294 295 6.500% due 10/15/2007 63 64 6.000% due 12/15/2008 5,084 5,114 7.000% due 07/15/2022 96 97 6.000% due 06/15/2023 23 23 6.500% due 08/15/2023 11,120 11,210 6.500% due 10/15/2023 1,245 1,238 7.000% due 11/15/2023 27 27 8.500% due 04/15/2025 2,407 2,576 8.000% due 02/15/2027 469 494 General Electric Capital Mortgage Services, Inc. 7.000% due 10/25/2027 14,238 14,351 GMAC Commercial Mortgage Asset Corp. 5.307% due 07/20/2002 (d) 13,181 13,181 Government National Mortgage Association 7.500% due 04/20/2027 2,664 2,764 5.750% due 02/16/2030 (d) 11,166 11,187 6.220% due 02/16/2030 (d) 8,418 8,440 5.600% due 10/16/2030 (d) 3,576 3,576 Impac Secured Assets CMN Owner Trust 8.000% due 07/25/2030 17,143 17,778 PNC Mortgage Securities Corp. 6.500% due 12/25/2028 5,000 4,939 7.000% due 06/25/2030 11,303 11,307 Residential Funding Mortgage Securities I 6.981% due 06/25/2008 1,900 1,920 7.000% due 05/25/2012 1,791 1,851 Saco I, Inc. 6.601% due 07/25/2030 (d) 9,884 10,071 ------------ 194,157 ------------ Fannie Mae 1.5% 5.500% due 06/01/2007 48 48 6.000% due 05/01/2005-02/01/2014 (g) 792 796 6.830% due 09/01/2017 (d) 393 401 6.839% due 01/01/2027 (d) 527 534 6.850% due 08/01/2018 (d) 265 270 7.000% due 05/01/2012 438 449 7.500% due 08/01/2015-07/01/2029 (g) 3,654 3,761 8.000% due 09/01/2026-10/01/2026 (g) 2,193 2,288 ------------ 8,547 ------------ Federal Housing Administration 1.7% 7.430% due 04/01/2022-06/01/2023 (g) 9,897 9,798 ------------ Freddie Mac 0.0% 7.500% due 07/01/2003 37 37 7.750% due 08/01/2001 2 2 ------------ 39 ------------ Government National Mortgage Association 56.5% 6.000% due 06/15/2028-06/15/2029 (g) 6,399 6,286 6.500% due 04/23/2031 (d) 142,970 142,926 7.000% due 03/15/2029-05/21/2031 (g) 52,408 53,117 7.375% due 03/20/2020-03/20/2028 (d)(g) 6,069 6,130 7.500% due 12/15/2028-04/23/2031 (g) 97,060 99,471 7.625% due 11/20/2017-11/20/2025 (d)(g) 512 525 8.000% due 04/15/2017-04/23/2031 (g) 15,572 16,265 9.000% due 06/15/2009 909 963 ------------ 325,683 ------------ Total Mortgage-Backed Securities 538,224 (Cost $533,509) ------------ -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 8.9% -------------------------------------------------------------------------------- AFC Home Equity Loan Trust 6.947% due 06/25/2030 (d) 4,453 4,461 Brazos Student Loan Finance Co. 7.210% due 06/01/2023 (d) 10,000 9,978 Chase Credit Card Master Trust 6.777% due 05/15/2007 2,119 2,133 Freemont Home Loan Owner Trust 7.042% due 12/25/2029 (d) 9,000 9,036 Green Tree Recreational, Equipment, & Consumables 6.430% due 04/17/2006 1,233 1,245 IMC Home Equity Loan Trust 5.893% due 03/25/2027 (d) 50 50 Option One Mortgage Loan Trust 6.003% due 06/25/2030 (d) 8,756 8,770 Provident Bank Home Equity Loan Trust 6.917% due 08/25/2031 (d) 15,572 15,587 The Money Store Home Equity Trust 6.040% due 08/15/2017 272 272 ------------ Total Asset-Backed Securities 51,532 (Cost $51,406) ------------ -------------------------------------------------------------------------------- SOVEREIGN ISSUES 1.4% -------------------------------------------------------------------------------- Hydro-Quebec 7.620% due 04/02/2001 1,000 1,000 6.500% due 09/29/2049 (d) 5,000 4,450 Republic of Brazil 7.375% due 04/15/2006 (d) 2,886 2,618 ------------ Total Sovereign Issues 8,068 (Cost $8,208) ------------ -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES (c)(e) 10.0% -------------------------------------------------------------------------------- Banque Centrale De Tunisie 7.500% due 08/06/2009 EC 6,000 5,469 Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 800 354 Republic of Austria 5.500% due 01/15/2010 (i) EC 1,000 911 Republic of Germany 5.000% due 08/19/2005 808 729 4.500% due 07/04/2009 (i) 6,800 5,934 5.375% due 01/04/2010 (i) 4,700 4,357 5.250% due 07/04/2010 (i) 20,880 19,148 5.250% due 01/04/2011 (i) 20,960 19,218 6.250% due 01/04/2024 (i) 370 362 6.500% due 07/04/2027 (i) 810 819 6.250% due 01/04/2030 (i) 350 347 ------------ Total Foreign Currency-Denominated Issues 57,648 (Cost $61,443) ------------ 96 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Value Shares (000s) -------------------------------------------------------------------------------- PREFERRED SECURITY 0.7% -------------------------------------------------------------------------------- DG Funding Trust 7.153% due 12/29/2049 (d) 410 $ 4,183 ------------ Total Preferred Security 4,183 (Cost $4,100) ------------ -------------------------------------------------------------------------------- PREFERRED STOCK 0.1% -------------------------------------------------------------------------------- TCI Communications, Inc. 10.000% due 05/31/2045 33,354 838 ------------ Total Preferred Stock 838 (Cost $852) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 7.0% -------------------------------------------------------------------------------- Principal Amount (000s) Commercial Paper 6.9% Abbey National North America 5.090% due 04/19/2001 $ 200 200 5.040% due 08/06/2001 400 393 American Express Credit Corp. 4.860% due 05/15/2001 1,400 1,392 Fannie Mae 4.700% due 05/16/2001 300 298 4.685% due 09/06/2001 700 686 4.695% due 09/06/2001 5,000 4,896 Freddie Mac 5.070% due 04/03/2001 500 500 General Electric Capital Corp. 4.990% due 04/03/2001 3,000 3,000 5.200% due 04/03/2001 1,400 1,400 5.200% due 04/18/2001 1,200 1,197 5.350% due 05/09/2001 700 696 National Rural Utilities Cooperative Finance Corp. 4.880% due 05/25/2001 1,800 1,787 Reseau Ferre De France 4.590% due 07/25/2001 13,500 13,290 SBC Communications, Inc. 5.290% due 04/10/2001 1,000 999 Swedbank, Inc. 5.150% due 04/25/2001 200 199 UBS Finance, Inc. 5.410% due 05/16/2001 1,600 1,589 4.850% due 08/07/2001 5,000 4,914 4.760% due 08/15/2001 1,300 1,276 4.820% due 08/15/2001 800 786 Verizon Global Funding 5.240% due 04/05/2001 400 400 ------------ 39,898 ------------ Repurchase Agreement 0.1% State Street Bank 4.600% due 04/02/2001 312 312 (Dated 03/30/2001. Collateralized by Fannie Mae ------------ 6.350% due 06/22/2001 valued at $322. Repurchase proceeds are $312.) U.S. Treasury Bills (b) 0.0% 4.913% due 05/17/2001 125 124 ------------ Total Short-Term Instruments 40,334 (Cost $40,350) ------------ Total Investments (a) 159.4% $ 919,646 (Cost $914,575) Other Assets and Liabilities (Net) (59.4%) (342,735) ------------ Net Assets 100.0% $ 576,911 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $914,603 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 9,914 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (4,871) ------------ Unrealized appreciation-net $ 5,043 ------------ (b) Securities with an aggregate market value of $1,796 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- EuroBond 10 Year Note (06/2001) 25 $ 14 Government of Japan 10 Year Note (06/2001) 1 4 U.S. Treasury 10 Year Note (06/2001) 19 7 U.S. Treasury 30 Year Bond (06/2001) 9 (19) 10 Year Agency June Futures (06/2001) 11 2 Eurodollar September Futures (09/2002) 15 (5) Eurodollar March Futures (03/2003) 15 (7) Eurodollar June Futures (06/2002) 15 (4) Eurodollar December Futures (12/2002) 15 (6) ------------ $ (14) ------------ (c) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy EC 9,798 04/2001 $ (519) Sell 9,933 04/2001 36 Buy 9,798 06/2001 (33) Buy JY 28,000 04/2001 (5) Sell 28,000 04/2001 13 Sell 28,000 06/2001 5 Sell N$ 827 04/2001 14 ---------- $ (489) ---------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Principal amount denoted in indicated currency: BP - British Pound EC - Euro JY - Japanese Yen N$ - New Zealand Dollar See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 97 Schedule of Investments (Cont.) Moderate Duration Fund March 31, 2001 -------------------------------------------------------------------------------- (f) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.669%. Broker: Goldman Sachs Exp. 05/18/2001 JY 500,000 $ (207) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.805%. Broker: Morgan Stanley Exp. 01/11/2011 913,000 (322) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.777%. Broker: Goldman Sachs Exp. 01/12/2011 301,000 (100) Receive a fixed rate equal to 5.305% and pay floating rate based on 6-month BP-LIBOR Broker: Goldman Sachs Exp. 03/19/2006 BP 5,800 (40) Receive floating rate based on 6-month BP-LIBOR and pay a fixed rate equal to 5.215%. Broker: Goldman Sachs Exp. 09/19/2002 5,800 8 Receive a fixed rate equal to 5.207% and pay floating rate based on 6-month BP-LIBOR Broker: Morgan Stanley Exp. 03/15/2004 50,000 (44) Receive fixed rate equal to 0.510% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 01/25/2005 $ 5,000 0 ------------- $ (705) ------------- (g) Securities are grouped by coupon or range of coupons and represent a range of maturities. (h) Principal amount of the security is adjusted for inflation. (i) Subject to financing transaction. 98 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments Low Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 46.8% -------------------------------------------------------------------------------- Banking & Finance 23.6% American General Finance 6.875% due 12/14/2001 $ 25,000 $ 25,373 Associates Corp. of North America 6.700% due 05/29/2001 400 401 5.400% due 08/27/2001 (d) 1,000 1,003 6.875% due 06/20/2002 20,000 20,420 6.950% due 08/01/2002 1,000 1,026 AT&T Capital Corp. 5.881% due 04/23/2002 (d) 10,000 10,024 Banco Nacional de Comercio Exterior 7.250% due 02/02/2004 1,800 1,814 Bank of America Corp. 7.200% due 09/15/2002 100 103 7.875% due 12/01/2002 100 104 6.625% due 06/15/2004 1,000 1,032 Bank One Corp. 7.250% due 08/01/2002 500 514 Bear Stearns Co., Inc. 4.370% due 06/28/2001 (d) 2,000 2,003 5.370% due 12/16/2002 (d) 2,800 2,805 6.125% due 02/01/2003 3,000 3,026 5.210% due 03/28/2003 (d) 8,600 8,597 6.200% due 03/30/2003 9,700 9,795 7.156% due 06/01/2004 (d) 3,000 2,965 Beaver Valley Funding Corp. 8.250% due 06/01/2003 3,311 3,401 Beneficial Corp. 5.409% due 01/09/2002 (d) 10,000 10,017 6.650% due 09/12/2002 5,000 5,090 6.575% due 12/16/2002 5,440 5,541 Capital One Bank 7.000% due 04/30/2001 300 300 5.820% due 06/23/2003 (d) 1,100 1,076 Case Credit Corp. 5.713% due 08/01/2001 (d) 4,750 4,604 Chrysler Financial Corp. LLC 5.120% due 08/08/2002 (d) 8,000 7,930 CIT Group, Inc. 5.190% due 09/13/2002 (d) 19,900 19,842 7.375% due 03/15/2003 1,000 1,033 Credit Asset Receivable 6.274% due 10/31/2003 30,349 30,461 Export-Import Bank Korea 6.500% due 02/10/2002 7,500 7,505 6.500% due 11/15/2006 6,700 6,827 7.100% due 03/15/2007 6,700 6,965 Finova Capital Corp. 6.316% due 04/08/2003 (d)(i) 1,000 820 5.193% due 06/18/2003 (d)(i) 6,000 4,920 Ford Motor Credit Co. 6.093% due 03/19/2002 (d) 18,857 18,818 5.939% due 07/16/2002 (d) 100 100 6.520% due 08/12/2002 13,000 13,223 6.000% due 01/14/2003 15,000 15,117 5.133% due 03/17/2003 (d) 3,000 2,978 6.125% due 04/28/2003 14,000 14,150 5.860% due 04/26/2004 (d) 19,000 18,841 7.500% due 03/15/2005 1,000 1,047 6.179% due 07/18/2005 (d) 400 394 General Motors Acceptance Corp. 7.125% due 05/01/2001 15,000 15,023 5.509% due 11/12/2002 (d) 17,400 17,417 5.609% due 11/12/2002 (d) 63,520 63,349 5.875% due 01/22/2003 500 503 6.750% due 03/15/2003 3,700 3,788 6.394% due 07/20/2003 (d) 7,822 7,814 5.550% due 09/15/2003 3,000 2,996 5.750% due 11/10/2003 5,000 5,011 6.396% due 01/20/2004 (d) 9,400 9,399 5.750% due 03/22/2004 (d) 5,000 5,000 6.536% due 04/05/2004 (d) 700 690 7.625% due 06/15/2004 1,000 1,051 6.850% due 06/17/2004 1,000 1,028 Gold Eagle Capital Ltd. 8.629% due 04/15/2001 (d) 20,000 20,006 Great Western Financial 8.600% due 02/01/2002 4,000 4,104 Heller Financial, Inc. 5.979% due 10/22/2001 (d) 1,000 1,001 5.858% due 04/28/2003 (d) 20,000 19,944 Hitachi Credit America 6.100% due 04/24/2001 25,000 25,013 Household Finance Corp. 6.490% due 04/09/2001 20,000 20,004 6.125% due 07/15/2002 11,000 11,090 7.625% due 01/15/2003 10,849 11,260 6.125% due 02/27/2003 1,500 1,513 5.116% due 06/24/2003 (d) 1,500 1,495 Industrial Bank of Korea 8.375% due 09/30/2002 5,000 5,177 Key Bank NA 6.052% due 04/24/2003 12,900 12,988 KFW International Finance, Inc. 5.000% due 01/22/2002 7,690 7,700 5.500% due 02/19/2002 7,887 7,936 5.375% due 05/10/2002 12,282 12,360 6.125% due 07/08/2002 18,589 18,890 Korea Development Bank 7.125% due 09/17/2001 28,963 29,154 7.900% due 02/01/2002 6,100 6,191 7.625% due 10/01/2002 21,200 21,742 6.500% due 11/15/2002 5,898 5,957 8.294% due 06/16/2003 (d) 3,500 3,430 6.625% due 11/21/2003 20,300 20,549 Lehman Brothers Holdings, Inc. 6.110% due 05/07/2002 (d) 5,000 5,027 6.186% due 07/08/2002 (d) 1,500 1,501 5.610% due 12/12/2002 (d) 1,500 1,506 5.240% due 04/04/2003 (d) 7,900 7,912 Marsh & McLennan Cos., Inc. 6.625% due 06/15/2004 1,000 1,033 Merrill Lynch & Co. 5.945% due 11/26/2001 (d) 80,600 80,825 5.779% due 01/15/2002 (d) 5,000 5,003 7.129% due 02/08/2002 (d) 25,000 25,078 6.130% due 04/07/2003 7,770 7,926 Metropolitan Life Insurance Co. 6.300% due 11/01/2003 17,850 18,140 Middletown Trust 11.750% due 07/15/2010 911 952 Midland Funding I 10.330% due 07/23/2002 1,335 1,388 Morgan Stanley Group, Inc. 5.228% due 03/11/2003 (d) 5,000 5,000 Nacional Financiera 10.625% due 11/22/2001 7,500 7,714 7.284% due 05/08/2003 (d) 7,000 7,180 Pemex Finance Ltd. 6.125% due 11/15/2003 13,933 13,849 PNC Bank NA 5.150% due 01/24/2002 (d) 20,000 20,012 Popular North American, Inc. 6.875% due 06/15/2001 5,000 5,018 7.375% due 09/15/2001 20,000 20,211 Popular, Inc. 6.200% due 04/30/2001 1,000 1,001 Qwest Capital Funding, Inc. 6.125% due 07/15/2002 5,250 5,282 Rothmans Holdings 6.500% due 05/06/2003 14,000 14,146 Salomon, Inc. 7.250% due 05/01/2001 3,700 3,706 7.300% due 05/15/2002 15,000 15,400 7.500% due 02/01/2003 3,000 3,118 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (j) 1,104 1,110 5.568% due 05/14/2002 (d) 25,150 25,174 5.891% due 07/23/2002 (d) 5,100 5,099 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 99 Schedule of Investments (Cont.) Low Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Seismic Ltd. 10.901% due 01/01/2002 (d) $ 10,000 $ 9,940 Shopping Center Associates 6.750% due 01/15/2004 11,725 11,920 Spieker Properties, Inc. 6.800% due 05/01/2004 2,000 2,040 Toyota Motor Credit Corp. 7.325% due 02/15/2002 (d) 11,600 11,620 Transamerica Finance Corp. 6.125% due 11/01/2001 5,000 5,032 Wachovia Corp. 6.075% due 05/02/2005 (d) 8,000 7,990 Wells Fargo & Co. 6.625% due 07/15/2004 1,000 1,037 6.025% due 05/02/2005 (d) 32,700 32,672 ------------ 1,084,140 ------------ Industrials 12.0% Allied Waste North America, Inc. 7.375% due 01/01/2004 5,000 4,925 AMR Corp. 9.125% due 10/24/2001 4,250 4,338 Atlas Air, Inc. 8.010% due 01/02/2010 9,778 9,932 Caterpillar, Inc. 9.750% due 06/01/2019 13,766 14,379 Cemex SA de CV 8.625% due 07/18/2003 10,000 10,300 Coastal Corp. 5.554% due 03/06/2002 (d) 32,200 32,200 Conoco, Inc. 5.900% due 04/15/2004 3,100 3,151 Cox Enterprises, Inc. 6.625% due 06/14/2002 3,000 3,035 6.425% due 05/01/2033 (d) 2,000 2,001 DaimlerChrysler North America Holding Corp. 5.790% due 12/16/2002 (d) 13,400 13,345 5.720% due 08/16/2004 (d) 1,000 975 6.900% due 09/01/2004 1,000 1,016 Delta Air Lines, Inc. 8.500% due 09/15/2001 205 208 6.650% due 03/15/2004 2,925 2,862 Eastman Chemical Co. 6.375% due 01/15/2004 250 244 Electric Lightwave, Inc. 6.050% due 05/15/2004 3,000 2,742 Enron Corp. 5.510% due 09/10/2001 (d) 1,000 1,001 8.000% due 08/15/2005 8,300 8,901 Federal-Mogul Corp. 7.500% due 07/01/2004 28,600 4,433 Ford Motor Co. 9.000% due 09/15/2001 500 508 Fred Meyer, Inc. 7.150% due 03/01/2003 13,500 13,999 General Motors Corp. 6.250% due 05/01/2005 7,000 7,065 Global Crossing Holding Ltd. 6.000% due 10/15/2013 7,500 7,110 HCA - The Healthcare Co. 8.130% due 08/04/2003 5,000 5,184 6.630% due 07/15/2045 7,000 7,071 HMH Properties, Inc. 7.875% due 08/01/2005 5,000 4,863 IMEXSA Export Trust 10.125% due 05/31/2003 5,718 5,564 International Game Technology 7.875% due 05/15/2004 500 508 Kroger Co. 6.340% due 06/01/2001 5,000 5,006 Lockheed Martin Corp. 6.850% due 05/15/2001 7,300 7,310 Nabisco, Inc. 6.700% due 06/15/2002 21,100 21,207 Occidental Petroleum Corp. 6.400% due 04/01/2003 15,945 16,057 Park Place Entertainment Corp. 7.950% due 08/01/2003 15,955 16,394 Petroleos Mexicanos 7.845% due 07/15/2005 (d) 10,400 10,426 7.769% due 07/15/2005 (d) 10,173 10,198 9.375% due 12/02/2008 5,500 5,734 Philip Morris Cos., Inc. 7.250% due 09/15/2001 500 504 7.500% due 01/15/2002 200 203 7.250% due 01/15/2003 4,050 4,174 8.250% due 10/15/2003 1,000 1,066 6.950% due 06/01/2006 25,000 25,031 Phillips Petroleum Co. 8.500% due 05/25/2005 2,000 2,201 Qwest Corp. 7.625% due 06/09/2003 25,000 25,930 5.650% due 11/01/2004 9,250 8,998 R & B Falcon Corp. 6.500% due 04/15/2003 11,000 11,094 Raytheon Co. 5.739% due 08/10/2001 (d) 500 501 Rollins Truck Leasing Co. 8.000% due 02/15/2003 3,000 3,143 Shoppers Food Warehouse Corp. 9.750% due 06/15/2004 10,500 10,978 Starwood Hotels & Resorts 6.750% due 11/15/2005 2,000 1,981 TCI Communications, Inc. 5.580% due 03/11/2003 (d) 3,000 3,018 Tenet Healthcare Corp. 7.875% due 01/15/2003 5,300 5,413 8.625% due 12/01/2003 9,700 10,078 Time Warner, Inc. 7.975% due 08/15/2004 1,950 2,080 TTX Co. 7.820% due 07/21/2003 61,000 64,243 Tyco International Group SA 6.875% due 09/05/2002 18,805 19,096 Union Oil Co. of California 9.100% due 08/15/2001 3,350 3,397 Waste Management, Inc. 6.500% due 05/15/2004 45,000 45,007 Yorkshire Power 6.154% due 02/25/2003 40,000 40,019 ------------ 552,347 ------------ Utilities 11.2% Arizona Public Service Co. 5.875% due 02/15/2004 5,600 5,599 Arkansas Power & Light 6.000% due 10/01/2003 450 450 BellSouth Telecommunications, Inc. 6.000% due 06/15/2002 3,000 3,036 British Telecommunications PLC 6.079% due 12/15/2003 (d) 9,900 9,904 7.625% due 12/15/2005 73,400 76,023 Calpine Corp. 9.250% due 02/01/2004 2,960 2,961 CenturyTel, Inc. 7.750% due 10/15/2012 32,000 32,590 Cinergy Corp. 6.125% due 04/15/2004 13,000 12,766 Cleveland Electric Illuminating Co. 8.550% due 11/15/2001 2,075 2,117 7.850% due 07/30/2002 3,500 3,609 9.500% due 05/15/2005 9,000 9,316 CMS Energy Corp. 8.125% due 05/15/2002 5,000 5,064 7.625% due 11/15/2004 15,400 15,295 8.000% due 07/01/2011 5,000 5,011 Connecticut Light & Power Co. 7.875% due 06/01/2001 500 502 8.590% due 06/05/2003 10,000 10,772 100 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- DTE Capital Corp. 8.350% due 11/15/2038 (d) $ 1,000 $ 1,021 Duke Energy Field Services 7.500% due 08/16/2005 1,000 1,053 Entergy Louisiana, Inc. 7.740% due 07/01/2002 3,308 3,314 8.500% due 06/01/2003 4,000 4,216 Entergy Mississippi, Inc. 7.750% due 02/15/2003 35,000 36,214 France Telecom 7.200% due 03/01/2006 29,300 29,818 Illinois Power Co. 6.250% due 07/15/2002 10,000 10,120 6.000% due 09/15/2003 12,500 12,634 Kentucky Power Co. 6.650% due 05/01/2003 1,000 1,002 Kinder Morgan, Inc. 6.450% due 11/30/2001 440 442 Niagara Mohawk Power Co. 7.125% due 07/01/2001 1,512 1,518 7.250% due 10/01/2002 16,634 16,988 Noram Energy Corp. 6.375% due 11/01/2003 2,000 2,043 Ohio Edison Co. 8.625% due 09/15/2003 5,000 5,339 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(i) 46,700 38,528 Scana Corp. 5.910% due 02/08/2002 (d) 1,000 1,001 Sprint Capital Corp. 9.500% due 04/01/2003 5,800 6,219 Texas Utilities Corp. 5.940% due 10/15/2001 13,155 13,217 6.500% due 08/16/2002 1,000 1,014 9.700% due 02/28/2003 4,695 5,075 6.750% due 03/01/2003 925 944 6.750% due 04/01/2003 3,875 3,958 6.875% due 08/01/2005 2,000 2,060 Toledo Edison Co. 8.180% due 07/30/2002 2,500 2,572 United Illuminating Co. 6.000% due 12/15/2003 13,000 13,137 Western Massachusetts Electric Co. 7.750% due 12/01/2002 4,847 4,853 Williams Cos., Inc. 5.889% due 11/15/2001 (d) 6,200 6,209 WorldCom, Inc. 6.125% due 08/15/2001 45,000 45,077 8.875% due 01/15/2006 45,170 46,653 6.125% due 04/15/2012 4,300 4,307 ------------ 515,561 ------------ Total Corporate Bonds & Notes 2,152,048 (Cost $2,154,130) ------------ -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 1.7% -------------------------------------------------------------------------------- Fannie Mae 4.625% due 10/15/2001 535 535 6.850% due 11/06/2003 30,000 30,415 7.125% due 09/19/2005 25,000 25,862 7.000% due 11/14/2005 15,085 15,613 Federal Home Loan Bank 6.240% due 08/24/2001 210 211 Freddie Mac 5.750% due 06/15/2001 750 752 6.500% due 02/04/2013 1,200 1,184 6.625% due 07/02/2013 1,195 1,184 Small Business Administration 8.250% due 01/25/2013 (d) 249 252 8.250% due 02/25/2014 (d) 705 708 ------------ Total U.S. Government Agencies 76,716 (Cost $75,476) ------------ -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 9.0% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (h) 3.625% due 07/15/2002 (b) 183,695 187,312 3.375% due 01/15/2007 (j) 50,333 50,884 3.625% due 01/15/2008 (j) 116,814 119,552 3.875% due 01/15/2009 (j) 55,935 58,173 U.S. Treasury Strips 0.000% due 02/15/2019 200 72 ------------ Total U.S. Treasury Obligations 415,993 (Cost $402,940) ------------ -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 108.2% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 25.4% Amortizing Residential Collateral Trust 5.790% due 09/25/2030 (d) 15,028 15,042 Bear Stearns Adjustable Rate Mortgage Trust 7.490% due 12/25/2030 (d) 17,118 17,297 7.499% due 12/25/2030 (d) 15,967 16,149 Cendant Mortgage Corp. 6.500% due 01/18/2016 455 456 Chase Commercial Mortgage Securities Corp. 7.600% due 12/18/2005 127 133 Chase Mortgage Finance Corp. 10.000% due 11/25/2009 12 12 6.500% due 06/25/2013 5,617 5,699 8.494% due 04/25/2025 (d) 1,487 1,518 6.750% due 07/25/2028 11,250 11,319 6.350% due 07/25/2029 4,186 4,243 Citicorp Mortgage Securities, Inc. 6.875% due 12/01/2019 (d) 375 373 6.750% due 05/25/2028 6,266 6,241 CMC Securities Corp. IV 7.250% due 10/25/2027 12,141 12,482 7.250% due 11/25/2027 10,106 10,389 Collateralized Mortgage Obligation Trust 7.375% due 01/20/2003 (d) 2 2 Commercial Trust 6.670% due 12/15/2003 (d) 3,267 3,134 Countrywide Funding Corp. 6.875% due 01/25/2035 (d) 1,906 1,901 Countrywide Home Loans 6.250% due 07/25/2009 208 208 6.900% due 12/25/2027 18,168 18,423 Criimi Mae Financial Corp. 7.000% due 01/01/2033 8,427 8,510 CS First Boston Mortgage Securities Corp. 6.960% due 01/20/2004 128 131 6.400% due 02/17/2004 119 121 7.500% due 02/25/2031 69,976 71,972 7.500% due 03/25/2031 29,978 30,273 Dime Savings 7.293% due 11/01/2018 (d) 1,143 1,058 DLJ Commercial Mortgage Corp. 7.571% due 09/05/2001 (d) 1,126 1,132 DLJ Mortgage Acceptance Corp. 11.000% due 08/01/2019 622 692 9.308% due 05/25/2024 (d) 826 838 5.978% due 06/25/2026 (d) 8,609 8,493 6.850% due 12/17/2027 165 171 Drexel Burnham Lambert Trust 6.063% due 05/01/2016 (d) 20 20 Enterprise Mortgage Acceptance Co. 6.110% due 07/15/2003 93 94 Fannie Mae 8.950% due 05/25/2003 13 13 9.000% due 07/25/2003 114 116 9.400% due 07/25/2003 30 30 6.875% due 06/25/2009 1,104 1,111 7.000% due 09/25/2016 10,368 10,505 9.250% due 10/25/2018 59 63 8.750% due 05/25/2019 9 9 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 101 Schedule of Investments (Cont.) Low Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 9.500% due 03/25/2020 $ 3,880 $ 4,284 9.500% due 05/25/2020 1,115 1,187 6.000% due 12/25/2020 18 17 9.000% due 03/25/2021 2,810 2,969 9.000% due 04/25/2021 96 103 8.000% due 12/25/2021 1,869 1,987 8.000% due 03/25/2022 20 20 5.663% due 04/25/2022 (d) 171 173 5.000% due 01/25/2024 4 4 First Nationwide Trust 7.750% due 10/25/2030 68,388 70,922 Freddie Mac 8.000% due 07/01/2006 35 37 6.000% due 07/15/2006 963 964 6.500% due 08/15/2006 1,473 1,480 8.500% due 01/01/2007 56 59 8.000% due 09/15/2007 673 687 5.750% due 01/15/2008 3,789 3,801 9.500% due 07/01/2010 61 64 6.500% due 08/15/2011 16,492 16,733 8.000% due 01/01/2012 83 83 12.500% due 09/30/2013 487 539 11.750% due 02/01/2014 2 2 6.750% due 06/15/2019 2,603 2,606 10.000% due 07/15/2019 210 225 9.000% due 11/15/2019 367 371 10.000% due 05/15/2020 151 161 7.500% due 12/15/2020 727 732 9.000% due 12/15/2020 2,507 2,640 9.500% due 01/15/2021 861 911 6.500% due 02/15/2021 893 898 8.000% due 04/15/2021 1,025 1,067 9.000% due 05/15/2021 173 181 9.500% due 09/01/2021 29 31 8.000% due 04/01/2022 426 446 8.000% due 11/01/2022 284 297 7.500% due 01/20/2024 3,044 3,064 8.500% due 08/01/2024 110 116 8.500% due 11/01/2024 916 962 6.250% due 04/15/2028 8,260 8,297 6.500% due 10/01/2028 63 63 6.947% due 08/15/2032 (d) 5,259 5,390 General Electric Capital Mortgage Services, Inc. 6.750% due 12/25/2012 2,198 2,217 7.500% due 11/25/2030 30,208 30,816 German American Capital Corp. 7.000% due 08/12/2010 (d) 6,800 7,185 Glendale Federal Savings & Loan 11.000% due 03/01/2010 15 16 7.490% due 03/25/2030 (d) 869 865 GMAC Commercial Mortgage Corp. 6.030% due 02/20/2003 (d) 1,328 1,329 6.476% due 09/20/2005 (d) 200 200 Golden Mortgage Loan 7.875% due 02/25/2031 (d) 17,840 18,100 Government National Mortgage Association 8.000% due 05/20/2020 2,838 2,865 Greenwich Capital Acceptance, Inc. 9.687% due 11/25/2024 (d) 25 25 Guardian Savings & Loan Association 7.557% due 09/25/2018 (d) 28 28 Home Savings of America 6.480% due 05/25/2027 (d) 1,116 1,107 Impac Secured Assets CMN Owner Trust 8.000% due 07/25/2030 100,857 104,598 Imperial Savings Association 8.839% due 06/25/2017 (d) 29 29 9.900% due 02/25/2018 333 337 International Mortgage Acceptance Corp. 12.250% due 03/01/2014 88 102 LB Commercial Conduit Mortgage Trust 6.330% due 11/18/2004 109 112 Mellon Residential Funding Corp. 6.400% due 06/26/2028 16,661 16,758 6.580% due 07/25/2029 (d) 17,411 17,622 Morgan Stanley Capital I 8.287% due 07/15/2005 93 97 7.258% due 01/16/2006 218 229 7.460% due 02/15/2020 25,873 27,175 Morgan Stanley Dean Witter Capital I 6.950% due 10/15/2026 (d) 317 317 Mortgage Capital Funding, Inc. 6.325% due 10/18/2007 20,401 20,830 Nationslink Funding Corp. 6.297% due 12/10/2002 5,000 5,101 Nomura Asset Securities Corp. 6.625% due 01/25/2009 163 163 Norwest Asset Securities Corp. 6.500% due 04/25/2028 1,280 1,302 6.500% due 01/25/2029 6,000 5,981 PNC Mortgage Securities Corp. 6.500% due 02/25/2028 3,864 3,857 6.750% due 05/25/2028 4,271 4,307 7.750% due 07/25/2030 53,197 54,614 7.500% due 05/25/2040 (d) 267 270 PNC Mortgage Trust 8.250% due 03/25/2030 3,396 3,501 Prudential Home Mortgage Securities 7.500% due 10/25/2007 729 746 7.000% due 01/25/2008 10,000 10,118 6.750% due 11/25/2008 5,285 5,315 7.000% due 08/25/2009 4,000 4,070 7.000% due 06/25/2023 2,665 2,683 6.050% due 04/25/2024 87 87 7.300% due 06/25/2024 774 780 Prudential-Bache Trust 6.676% due 09/01/2018 (d) 20 20 8.400% due 03/20/2021 2,981 3,119 Resecuritization Mortgage Trust 5.306% due 04/26/2021 (d) 6,886 6,843 Residential Accredit Loans, Inc. 6.500% due 02/25/2029 (d) 22,057 22,013 7.000% due 07/25/2029 482 487 Residential Asset Securitization Trust 6.500% due 09/25/2014 420 422 Residential Funding Mortgage Securities I 6.500% due 04/25/2009 14 14 7.500% due 12/25/2025 937 971 7.250% due 10/25/2027 14,920 14,963 6.250% due 11/25/2028 6,000 5,756 7.500% due 11/25/2030 36,779 36,787 Residential Funding Mortgage Securities, Inc. 7.000% due 07/25/2012 254 254 6.405% due 07/25/2019 (d) 705 693 7.500% due 08/25/2023 412 415 7.100% due 07/25/2027 3,808 3,815 7.000% due 10/25/2027 10,000 10,204 Resolution Trust Corp. 7.014% due 05/25/2019 (d) 3,100 3,091 6.860% due 08/25/2019 (d) 2,437 2,438 10.320% due 08/25/2021 350 349 8.625% due 10/25/2021 9,165 9,140 4.725% due 10/25/2021 427 408 6.940% due 10/25/2021 (d) 52 52 6.900% due 02/25/2027 2,880 2,800 9.000% due 09/25/2028 121 121 7.380% due 10/25/2028 (d) 710 719 6.209% due 10/25/2028 (d) 1,589 1,654 7.477% due 05/25/2029 (d) 1,988 2,031 Ryland Mortgage Securities Corp. 7.297% due 11/25/2021 (d) 400 400 Salomon Brothers Mortgage Securities VII 7.567% due 12/25/2017 (d) 1,349 1,369 8.391% due 12/25/2017 (d) 115 117 8.950% due 03/25/2024 (d) 815 832 9.120% due 09/25/2024 (d) 194 198 7.600% due 08/25/2030 14,156 14,454 Sasco Floating Rate Commercial Mortgage Trust 5.608% due 11/20/2001 (d) 1,254 1,256 102 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Sears Mortgage Securities 12.000% due 02/25/2014 $ 52 $ 54 7.431% due 10/25/2022 (d) 1,477 1,493 SLH Mortgage Trust 9.600% due 03/25/2021 216 215 Structured Asset Mortgage Investments, Inc. 6.902% due 06/25/2028 (d) 6,095 6,353 6.581% due 06/25/2029 (d) 29,054 29,515 9.030% due 06/25/2029 (d) 7,417 7,970 6.750% due 05/02/2030 3,819 3,771 Structured Asset Securities Corp. 6.750% due 07/25/2029 13,731 13,915 7.750% due 07/25/2030 26,348 27,057 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 9,071 9,071 Torrens Trust 5.424% due 07/15/2031 (d) 9,064 9,064 Union Planters Mortgage Finance Corp. 6.450% due 01/25/2028 6,000 6,025 Wells Fargo Mortgage-Backed Securities Trust 7.000% due 02/25/2016 154,405 158,204 ------------ 1,171,712 ------------ Fannie Mae 8.4% 6.000% due 05/01/2011 125 125 6.318% due 08/01/2029 18,057 18,296 6.500% due 09/01/2005-06/01/2008 (g) 696 708 6.748% due 11/01/2017 (d) 129 131 6.750% due 07/01/2017 (d) 329 333 6.758% due 04/01/2018 (d) 5,955 5,976 6.850% due 08/01/2017 (d) 37 37 6.857% due 12/01/2017-12/01/2023 (d)(g) 373 377 6.860% due 06/01/2017 (d) 70 71 7.000% due 04/01/2002-05/01/2012 (g) 266 272 7.282% due 01/01/2021 (d) 356 356 7.364% due 02/01/2028 (d) 5,087 5,274 7.434% due 07/25/2017 (d) 2,139 2,212 7.645% due 11/01/2017 (d) 277 279 7.766% due 11/01/2018 (d) 130 132 7.796% due 07/01/2017 (d) 435 443 8.000% due 03/01/2004-04/16/2031 (g) 325,049 335,205 8.290% due 10/01/2024 (d) 2,543 2,601 8.291% due 01/01/2024 (d) 103 106 8.351% due 04/01/2024 (d) 1,769 1,822 8.472% due 01/01/2024 (d) 28 29 8.484% due 01/01/2024 (d) 2,024 2,100 8.500% due 03/01/2008-01/01/2026 (g) 3,076 3,220 8.899% due 07/01/2023 (d) 1,245 1,268 9.000% due 01/01/2025 3 3 9.500% due 07/01/2024-11/01/2025 (g) 3,332 3,559 10.000% due 02/01/2004-01/01/2025 (g) 946 1,019 10.500% due 06/01/2005-12/01/2024 (g) 141 152 11.000% due 11/01/2020 39 43 11.250% due 12/01/2010-10/01/2015 (g) 100 112 11.500% due 12/01/2008-02/01/2020 (g) 54 60 11.750% due 02/01/2016 35 40 12.000% due 01/01/2015-10/01/2015 (g) 6 6 13.000% due 07/01/2015 5 6 13.250% due 09/01/2011 12 14 13.500% due 04/01/2014 3 4 15.500% due 10/01/2012-12/01/2012 (g) 51 62 15.750% due 12/01/2011 21 26 16.000% due 09/01/2012-12/01/2012 (g) 9 11 ------------ 386,490 ------------ Federal Housing Administration 1.2% 6.950% due 04/01/2014 2,029 2,068 7.400% due 02/01/2019 91 91 7.421% due 11/01/2019 447 445 7.430% due 10/01/2019-11/01/2025 (g) 53,446 53,253 ------------ 55,857 ------------ Freddie Mac 1.2% 6.000% due 09/01/2006-03/01/2011 (g) 8,960 9,076 6.500% due 02/01/2005 1 1 6.862% due 10/01/2027 (d) 1,006 1,037 7.000% due 05/14/2031 15,200 15,376 7.500% due 09/01/2006-03/01/2017 (d)(g) 241 242 7.625% due 01/01/2017 (d) 35 36 7.637% due 02/01/2020 (d) 2,007 2,038 8.000% due 03/01/2007-12/01/2024 (g) 3,792 3,950 8.250% due 10/01/2007-11/01/2007 (g) 22 23 8.337% due 11/01/2022 (d) 1,367 1,401 8.362% due 06/01/2024 (d) 548 563 8.365% due 11/01/2023 (d) 433 445 8.373% due 03/01/2024 (d) 64 66 8.376% due 10/01/2023 (d) 873 895 8.451% due 01/01/2024 (d) 1,599 1,645 8.500% due 07/01/2001-11/01/2025 (g) 10,498 11,008 8.511% due 07/01/2018 (d) 249 255 8.513% due 09/01/2023 (d) 221 227 8.535% due 12/01/2022 (d) 557 572 8.575% due 01/01/2024 (d) 694 720 8.750% due 04/01/2001-04/01/2002 (g) 14 14 9.000% due 05/01/2002-08/01/2022 (g) 2,725 2,891 9.250% due 07/01/2001 1 1 9.500% due 03/01/2001-02/01/2025 (g) 242 257 9.750% due 03/01/2001-11/01/2008 (g) 536 566 10.000% due 04/01/2015-10/01/2019 (g) 86 92 10.500% due 10/01/2010-02/01/2016 (g) 25 28 10.750% due 09/01/2009-08/01/2011 (g) 287 320 11.500% due 10/01/2015-01/01/2016 (g) 41 47 11.750% due 11/01/2010-08/01/2015 (g) 10 12 12.000% due 09/01/2013 2 2 14.000% due 09/01/2012-04/01/2016 (g) 10 10 14.500% due 12/01/2010 2 3 15.000% due 08/01/2011-12/01/2011 (g) 3 4 15.500% due 11/01/2011 0 0 16.000% due 04/01/2012 0 0 ------------ 53,823 ------------ Government National Mortgage Association 71.9% 6.375% due 05/20/2027 (d) 1,315 1,334 6.500% due 03/20/2023-04/23/2031 (d)(g) 111,439 111,415 7.000% due 03/15/2011-05/21/2031 (g) 452,672 459,180 7.125% due 11/20/2026 (d) 245 251 7.375% due 04/20/2016-06/20/2027 (d)(g) 36,190 36,731 7.500% due 02/15/2022-04/23/2031 (g) 1,309,585 1,342,645 7.625% due 10/20/2023-12/20/2027 (d)(g) 47,207 48,404 7.750% due 08/20/2022-07/20/2027 (d)(g) 64,425 65,942 8.000% due 07/15/2004-04/23/2031 (g) 1,060,864 1,094,119 8.500% due 12/15/2021-02/15/2031 (g) 111,934 116,268 9.000% due 06/20/2016-12/15/2030 (g) 31,879 33,309 9.500% due 10/15/2016-06/15/2025 (g) 105 112 9.750% due 07/15/2013-10/15/2017 (g) 424 459 10.000% due 10/15/2013-11/15/2025 (g) 105 116 10.500% due 11/15/2019-02/15/2021 (g) 15 17 11.000% due 09/15/2010 6 6 11.500% due 08/15/2018 33 37 11.750% due 08/15/2013-08/15/2015 (g) 46 53 12.000% due 06/20/2015 8 9 12.250% due 01/15/2014 36 41 13.000% due 10/15/2013 6 7 13.500% due 05/15/2011-11/15/2012 (g) 20 24 16.000% due 12/15/2011-02/15/2012 (g) 22 26 ------------ 3,310,505 ------------ Stripped Mortgage-Backed Securities 0.1% Fannie Mae (IO) 727.220% due 09/25/2006 20 80 6.000% due 02/25/2008 1,289 51 256.000% due 11/01/2008 19 78 6.500% due 03/25/2009 3,964 367 0.100% due 03/25/2009 (d) 13,512 214 7.500% due 03/25/2019 1,615 52 6.500% due 05/25/2019 6,869 390 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 103 Schedule of Investments (Cont.) Low Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 6.500% due 04/25/2020 $ 3,777 $ 207 7.000% due 05/25/2021 2,596 169 859.770% due 02/25/2022 16 200 6.500% due 03/25/2023 2,493 278 4.875% due 03/25/2024 (d) 5,879 269 Fannie Mae (PO) 0.000% due 09/25/2022 23 21 Freddie Mac (IO) 6.000% due 02/15/2006 7 0 998.181% due 07/15/2006 3 7 1019.460% due 08/15/2006 2 5 1194.390% due 12/15/2006 4 16 6.000% due 10/15/2007 192 7 6.000% due 02/15/2008 844 24 7.000% due 08/15/2018 4,260 164 6.500% due 05/15/2019 2,763 125 6.500% due 06/15/2019 1,399 67 1049.620% due 04/15/2021 11 92 6.500% due 04/15/2022 2,055 197 7.000% due 05/15/2023 265 31 4.000% due 01/15/2024 20,919 3,194 Prudential Home Mortgage Securities (IO) 0.300% due 04/25/2009 (d) 44,034 243 ------------ 6,548 ------------ Total Mortgage-Backed Securities 4,984,935 (Cost $4,959,493) ------------ -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 4.9% -------------------------------------------------------------------------------- Advanta Equipment Receivables 6.640% due 09/16/2002 348 350 Advanta Mortgage Loan Trust 7.760% due 05/25/2018 22,700 23,735 Amresco Residential Securities Mortgage Loan Trust 5.720% due 07/25/2027 (d) 85 85 Bayview Financial Revolving Mortgage 6.350% due 08/25/2029 (d) 6,900 6,960 Bombardier Capital Mortgage 6.605% due 09/15/2010 6,943 6,982 Capital Asset Research Funding LP 6.400% due 12/15/2004 58 58 Cento 6.013% due 03/02/2002 278 280 CIT Marine Trust 5.800% due 04/15/2010 200 202 Comed Transitional Funding Trust 5.290% due 06/25/2003 1,918 1,919 Community Program Loan Trust 4.500% due 10/01/2018 15,367 14,516 Compucredit Credit Card Master Trust 5.789% due 03/15/2007 (d) 32,000 32,000 Conseco Finance 6.940% due 11/15/2014 543 548 Contimortgage Home Equity Loan Trust 6.770% due 01/25/2018 1,000 1,012 Duck Auto Grantor Trust 5.650% due 03/15/2004 2,952 2,962 Embarcadero Aircraft Securitization Trust 5.644% due 08/15/2025 (d) 4,900 4,900 EQCC Home Equity Loan Trust 6.780% due 10/15/2027 (d) 229 229 Equity One ABS, Inc. 7.325% due 02/25/2032 9,400 9,653 GF Funding Corp. 6.890% due 01/20/2006 16,142 16,306 Green Tree Financial Corp. 6.550% due 02/15/2027 10,135 10,340 7.400% due 06/15/2027 12,743 13,356 Green Tree Floorplan Receivables Master Trust 5.921% due 11/15/2004 (d) 1,000 1,000 Green Tree Home Improvement Loan Trust 6.320% due 08/15/2008 970 971 5.334% due 08/15/2029 (d) 599 598 IMC Home Equity Loan Trust 5.223% due 10/20/2027 (d) 3,305 3,307 Irwin Home Equity 7.460% due 11/25/2004 18,321 18,856 Marriott Vacation Club Owner Trust 5.930% due 09/20/2017 (d) 8,294 8,288 Merit Securities Corp. 7.040% due 12/28/2033 16,618 16,697 New York City Tax Lien 6.350% due 07/10/2007 4,850 4,728 Oakwood Mortgage Investors, Inc. 6.950% due 08/15/2027 2,951 2,966 Ocwen Mortgage Loan Asset Backed Certificates 6.060% due 10/25/2029 (d) 561 562 Option One Mortgage Loan Trust 5.340% due 09/25/2030 (d) 5,686 5,695 Pacificamerica Home Equity Loan 5.270% due 03/25/2028 (d) 252 251 Providian Gateway Master Trust 5.849% due 03/16/2009 (d) 8,000 8,000 SallieMae 6.824% due 07/25/2004 (d) 21 21 6.628% due 04/25/2006 (d) 6,531 6,521 Saxon Asset Securities Trust 7.205% due 01/25/2019 275 283 5.760% due 05/25/2029 (d) 1,189 1,190 Southern Pacific Secured Assets Corp. 5.700% due 07/25/2029 (d) 274 273 The Money Store Home Equity Trust 5.344% due 06/15/2029 (d) 533 533 ------------ Total Asset-Backed Securities 227,133 (Cost $223,446) ------------ -------------------------------------------------------------------------------- SOVEREIGN ISSUES 0.8% -------------------------------------------------------------------------------- Province of Quebec 6.625% due 10/25/2001 (d) 250 250 Republic of Brazil 7.625% due 04/15/2006 (d) 6,248 5,663 United Mexican States 5.820% due 06/28/2001 10,500 10,519 9.616% due 04/07/2004 (d) 21,530 22,123 ------------ Total Sovereign Issues 38,555 (Cost $38,123) ------------ -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES 1.5% (e)(f) -------------------------------------------------------------------------------- British Telecom PLC 4.726% due 07/27/2001 (d) EC 16,000 14,020 Korea Development Bank 4.885% due 05/14/2001 DM 340 152 2.700% due 08/16/2002 JY 2,000,000 15,991 Republic of Austria 5.500% due 01/15/2010 EC 8,900 8,082 Republic of Colombia 7.000% due 03/06/2002 IL 36,220,000 16,287 United Mexican States 6.000% due 03/28/2002 JY 960,000 8,013 8.750% due 05/30/2002 BP 3,000 4,328 ------------ Total Foreign Currency-Denominated Issues 66,873 (Cost $74,176) ------------ -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 0.0% -------------------------------------------------------------------------------- U.S. Treasury Bond 6.000% due 06/30/2001 Strike @ 93.000 Exp. 05/26/2001 $ 150 2 ------------ Total Purchased Call Options 2 (Cost $3) ------------ 104 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Fannie Mae (OTC) 8.000% due 06/20/2031 Strike @ 93.734 Exp. 04/02/2001 $ 120,000 $ 0 Government National Mortgage Association (OTC) 8.000% due 06/20/2031 Strike @ 98.000 Exp. 06/13/2001 715,000 27 ------------ Total Purchased Put Options 27 (Cost $75) ------------ -------------------------------------------------------------------------------- PREFERRED STOCK 1.7% -------------------------------------------------------------------------------- Shares Home Ownership Funding 13.331% due 12/31/2049 3,000 2,265 Rhone-Poulenc SA 8.125% due 12/31/2049 13,000 327 SI Financing Trust I 9.500% due 06/30/2026 806,600 20,407 TCI Communications, Inc. 9.720% due 12/31/2036 224,700 5,719 8.720% due 01/31/2045 1,170,100 29,077 10.000% due 05/31/2045 800,300 20,088 ------------ Total Preferred Stock 77,883 (Cost $83,777) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 7.1% -------------------------------------------------------------------------------- Principal Amount (000s) Certificates of Deposit 0.1% Mexico Credit Link 11.384% due 02/22/2002 $ 5,000 5,127 Commercial Paper 6.7% Abbey National North America 5.070% due 08/06/2001 8,800 8,650 Fannie Mae 4.695% due 09/06/2001 83,800 82,060 Federal Home Loan Bank 4.675% due 09/07/2001 6,000 5,875 General Electric Capital Corp. 4.900% due 04/25/2001 33,000 32,897 Gillette Co. 4.910% due 08/21/2001 8,000 7,849 Glaxo Wellcome 4.970% due 04/30/2001 12,500 12,452 Halifax Building Society 4.600% due 08/02/2001 1,800 1,772 KFW International Finance, Inc. 4.840% due 08/08/2001 1,900 1,867 5.070% due 08/08/2001 3,700 3,636 Morgan Stanley Group, Inc. 5.050% due 04/11/2001 12,500 12,484 National Australia Funding 5.120% due 04/05/2001 12,500 12,495 National Rural Utilities Cooperative Finance Corp. 4.810% due 05/24/2001 4,000 3,972 4.910% due 05/25/2001 12,500 12,410 Swedbank, Inc. 4.930% due 04/25/2001 11,800 11,763 5.020% due 08/08/2001 200 197 4.900% due 08/23/2001 5,000 4,905 UBS Finance, Inc. 5.060% due 04/04/2001 28,800 28,792 5.030% due 08/07/2001 13,000 12,776 4.840% due 08/08/2001 9,500 9,336 5.010% due 08/08/2001 8,000 7,862 4.750% due 09/05/2001 17,000 16,649 4.740% due 09/12/2001 15,000 14,678 ------------ 305,377 ------------ Repurchase Agreement 0.3% State Street Bank 4.600% due 04/02/2001 14,789 14,789 ------------ (Dated 03/30/2001. Collateralized by Federal Farm Credit Bank 5.875% due 07/02/2001 valued at $15,086. Repurchase proceeds are $14,795.) U.S. Treasury Bills 0.0% 5.151% due 05/17/2001 (b)(g) 330 328 ------------ Total Short-Term Instruments 325,621 (Cost $325,580) ------------ Total Investments (a) 181.7% $ 8,365,786 (Cost $8,337,219) Written Options (c) (0.0%) (2,050) (Premiums $1,822) Other Assets and Liabilities (Net) (81.7%) (3,760,447) Net Assets 100.0% $ 4,603,289 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $8,337,305 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 82,621 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (54,140) Unrealized appreciation-net $ 28,481 ------------ (b) Securities with an aggregate market value of $10,468 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) ------------------------------------------------------------------------------- U.S. Treasury 5 Year Note (06/2001) 99 $ (26) U.S. Treasury 10 Year Note (06/2001) 48 21 U.S. Treasury 30 Year Bond (06/2001) 61 (69) Euribor Futures (03/2002) 294 342 Eurodollar September Futures (09/2002) 122 (41) Eurodollar March Futures (03/2003) 122 (58) Eurodollar June Futures (06/2002) 122 (36) Eurodollar December Futures (12/2002) 122 (51) ------------ $ 82 ------------ (c) Premiums received on written options: # of Type Contracts Premium Value ------------------------------------------------------------------------------- Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/31/2001 18,500,000 $ 171 $ 336 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 27,800,000 270 506 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 06/04/2001 26,600,000 157 503 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 9,300,000 86 169 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/21/2001 19,200,000 588 264 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/27/2001 19,200,000 550 272 ------------------------- $ 1,822 $ 2,050 ------------------------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 105 Schedule of Investments (Cont.) Low Duration Fund March 31, 2001 (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) ------------------------------------------------------------ Buy EC 102,029 04/2001 $ (5,410) Sell 102,029 04/2001 541 Buy 86,029 06/2001 (325) Sell BP 2,588 05/2001 127 Buy JY 2,967,100 04/2001 (576) Sell 2,967,100 04/2001 1,332 Sell 2,967,100 06/2001 598 ----------- $ (3,713) ----------- (f) Principal amount denoted in indicated currency: BP - British Pound DM - German Mark EC - Euro IL - Italian Lira JY - Japanese Yen (g) Securities are grouped by coupon or range of coupons and represent a range of maturities. (h) Principal amount of the security is adjusted for inflation. (i) Security is in default. (j) Subject to financing transaction. (k) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) ------------------------------------------------------------------------------- Receive fixed rate equal to 6.0% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 06/15/2006 $ 2,900 $ 53 Receive fixed rate equal to 5.633% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/02/2004 BP 23,300 305 Receive fixed rate equal to 5.626% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Exp. 02/01/2004 77,600 997 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.805%. Broker: Morgan Stanley Exp. 01/11/2011 JY 14,460,000 (5,083) Receive fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/02/2004 BP 175,100 1,585 Receive fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/02/2004 94,300 853 Receive fixed rate equal to 0.430% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 07/11/2003 $ 20,000 $ 1 Receive fixed rate equal to 0.230% and the Fund will pay to the counterparty at par in the event of default of Associates Corp. 6.000% due 04/15/2003. Broker: Warburg Dillon Read LLC Exp. 01/14/2003 43,000 1 Receive fixed rate equal to 0.510% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 01/25/2005 5,000 0 Receive fixed rate equal to 1.000% and the Fund will pay to the counterparty at par in the event of default of Enron Corp. 6.40% due 07/15/2006. Broker: Lehman Brothers Exp. 12/19/2001 25,000 0 Receive fixed rate equal to 1.25% and the Fund will pay to the counterparty at par in the event of default of MGM Mirage, Inc. Corporate Bond. Broker: Morgan Stanley Exp. 04/13/2001 20,000 0 ------------ $ (1,288) ------------ (l) Reverse repurchase agreements were entered into March 2, 2001 paying interest at 5.390%. The following security was segregated with collateral for reverse repurchase agreements: Type Maturity Value ------------------------------------------------------------------------------- Wells Fargo Mortgage-Backed Securities 02/25/2016 $ 158,204 ----------- (m) Short sales open at March 31, 2001 were as follows:
Coupon Type (%) Maturity Par Value Proceeds ------------------------------------------------------------------------------------- U.S. Treasury Notes 5.875 11/15/2004 137,080 $ 143,205 $ 142,647 U.S. Treasury Notes 6.000 08/15/2004 50,000 52,359 52,230 U.S. Treasury Notes 5.750 10/31/2002 123,200 126,138 125,874 U.S. Treasury Notes 6.750 05/15/2005 110,200 119,152 118,262 U.S. Treasury Notes 6.125 08/31/2002 16,400 16,833 16,748 U.S. Treasury Notes 5.750 11/15/2005 43,000 45,103 44,350 U.S. Treasury Notes 5.125 12/31/2002 103,400 104,927 104,470 U.S. Treasury Notes 4.250 11/15/2003 96,000 95,786 95,491 ------------------------ $ 703,503 $ 700,072 ------------------------
106 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments Low Duration Fund II March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 31.5% -------------------------------------------------------------------------------- Banking & Finance 28.9% Associates Corp. of North America 6.750% due 07/15/2001 $ 20,000 $ 20,103 5.750% due 11/01/2003 400 404 Beneficial Corp. 6.611% due 04/02/2002 (d) 3,000 3,003 Chrysler Financial Corp. LLC 5.100% due 06/18/2003 (d) 10,000 9,835 CIT Group, Inc. 7.375% due 03/15/2003 18,000 18,600 Countrywide Home Loans 6.850% due 06/15/2004 1,000 1,033 Donaldson, Lufkin & Jenrette, Inc. 7.250% due 07/18/2003 (d) 4,700 4,714 Ford Motor Credit Co. 7.750% due 11/15/2002 1,700 1,760 5.750% due 02/23/2004 800 800 6.125% due 03/20/2004 200 202 6.700% due 07/16/2004 900 921 7.213% due 07/18/2005 (d) 12,300 12,106 General Electric Capital Corp. 5.890% due 05/11/2001 800 801 General Motors Acceptance Corp. 7.125% due 05/01/2001 4,000 4,006 6.625% due 01/10/2002 4,000 4,050 6.625% due 10/01/2002 25 25 5.875% due 01/22/2003 4,000 4,026 7.625% due 05/05/2003 1,100 1,145 8.950% due 07/02/2009 10,279 11,079 Goldman Sachs Group, Inc. 6.600% due 07/15/2002 1,500 1,527 6.963% due 01/17/2003 (d) 3,000 3,005 Heller Financial, Inc. 5.956% due 07/24/2002 (d) 15,000 15,031 Hitachi Credit America 6.100% due 04/24/2001 20,000 20,010 Household Finance Corp. 6.700% due 06/15/2002 2,525 2,574 Lehman Brothers Holdings, Inc. 7.450% due 05/07/2002 (d) 5,200 5,228 Metropolitan Life Insurance Co. 6.300% due 11/01/2003 10,000 10,162 Morgan Stanley, Dean Witter & Co. 5.660% due 08/07/2003 (d) 2,400 2,403 Sears Roebuck Acceptance Corp. 6.720% due 10/23/2002 20,000 20,288 Wells Fargo & Co. 6.625% due 07/15/2004 105 109 Westdeutsche Landesbank 6.750% due 06/15/2005 5,000 5,129 ------------ 184,079 ------------ Industrials 1.5% Cargill, Inc. 6.871% due 01/14/2002 (d) 5,000 5,002 Caterpillar, Inc. 9.750% due 06/01/2019 3,871 4,043 Procter & Gamble Co. 5.250% due 09/15/2003 400 404 Times Mirror Co. 6.650% due 10/15/2001 200 202 Wal-Mart Stores, Inc. 6.550% due 08/10/2004 100 104 ------------ 9,755 ------------ Utilities 1.1% AT&T Corp. 5.125% due 04/01/2001 900 900 DTE Capital Corp. 6.170% due 06/15/2003 (d) 5,000 5,036 Southern California Gas Co. 5.670% due 01/18/2028 1,000 801 6,737 ------------ Total Corporate Bonds & Notes 200,571 (Cost $198,259) ------------ -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 1.1% -------------------------------------------------------------------------------- Fannie Mae 7.500% due 02/11/2002 175 179 6.250% due 11/15/2002 150 154 5.250% due 01/15/2003 935 946 6.500% due 08/15/2004 100 105 7.000% due 07/15/2005 75 80 6.625% due 09/15/2009 2,000 2,123 Federal Home Loan Bank 5.135% due 09/22/2003 400 402 6.340% due 11/05/2013 1,900 1,862 6.550% due 12/30/2013 1,085 1,071 ------------ Total U.S. Government Agencies 6,922 (Cost $6,496) ------------ -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 8.8% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (e) 3.625% due 07/15/2002 (b)(c) 4,701 4,794 3.375% due 01/15/2007 (c) 40,671 41,116 3.625% due 01/15/2008 (c) 3,685 3,771 3.875% due 01/15/2009 (c) 1,922 1,999 U.S. Treasury Notes 6.625% due 06/30/2001 75 75 5.875% due 11/30/2001 685 692 6.250% due 01/31/2002 480 488 6.375% due 08/15/2002 440 453 5.875% due 09/30/2002 240 246 5.750% due 08/15/2003 195 201 6.250% due 02/15/2003 315 326 4.750% due 02/15/2004 55 56 7.250% due 05/15/2004 325 351 5.875% due 11/15/2004 105 110 6.750% due 05/15/2005 370 400 6.625% due 05/15/2007 50 55 5.625% due 05/15/2008 800 836 ------------ Total U.S. Treasury Obligations 55,969 (Cost $55,021) ------------ -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 128.7% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 29.1% Bear Stearns Adjustable Rate Mortgage Trust 7.500% due 12/25/2030 (d) 2,616 2,646 7.490% due 12/25/2030 (d) 2,758 2,787 CMC Securities Corp. II 8.447% due 04/25/2025 (d) 1,095 1,094 Criimi Mae Financial Corp. 7.000% due 01/01/2033 10,874 10,980 CS First Boston Mortgage Securities Corp. 7.500% due 02/25/2031 22,597 23,241 DLJ Mortgage Acceptance Corp. 9.306% due 05/25/2024 (d) 417 423 Fannie Mae 6.150% due 09/25/2016 2,155 2,156 9.250% due 10/25/2018 59 63 8.000% due 11/25/2023 3,738 3,854 5.500% due 10/25/2030 (d) 7,477 7,490 First Nationwide Trust 7.750% due 10/25/2030 26,867 27,862 Freddie Mac 12.100% due 01/31/2009 975 1,038 12.900% due 05/01/2014 109 121 6.500% due 07/15/2017 298 299 6.000% due 05/15/2022 4,637 4,675 8.500% due 06/01/2025 119 124 7.500% due 08/15/2028 1,430 1,436 General Electric Capital Mortgage Services, Inc. 6.750% due 12/25/2012 2,198 2,217 Government National Mortgage Association 7.500% due 11/20/2023 1,000 1,031 7.750% due 01/17/2030 1,000 1,040 5.507% due 09/20/2030 (d) 4,288 4,277 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 107 Schedule of Investments (Cont.) Low Duration Fund II March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Guardian Savings & Loan Association 8.026% due 07/25/2019 (d) $ 39 $ 38 Nationslink Funding Corp. 5.921% due 04/10/2007 (d) 924 925 7.030% due 01/20/2008 184 193 Norwest Asset Securities Corp. 6.750% due 12/25/2027 2,169 2,179 6.500% due 04/25/2028 1,113 1,132 PNC Mortgage Securities Corp. 7.750% due 07/25/2030 7,151 7,342 Residential Funding Mortgage Securities, Inc. 7.500% due 10/25/2022 712 727 Resolution Trust Corp. 7.014% due 05/25/2019 (d) 674 672 7.379% due 10/25/2028 (d) 2,523 2,558 Ryland Mortgage Securities Corp. 14.000% due 11/25/2031 60 64 Salomon Brothers Mortgage Securities VII 8.450% due 11/25/2022 (d) 612 619 7.599% due 12/25/2030 2,331 2,380 Sears Mortgage Securities 7.431% due 10/25/2022 (d) 615 622 Structured Asset Mortgage Investments, Inc. 9.032% due 06/25/2029 (d) 7,966 8,560 6.750% due 05/02/2030 7,437 7,339 Structured Asset Securities Corp. 6.750% due 07/25/2029 4,366 4,410 7.750% due 07/25/2030 9,485 9,741 Union Planters Mortgage Finance Corp. 6.600% due 01/25/2028 13,000 13,157 Wells Fargo Mortgage-Backed Securities Trust 7.000% due 02/25/2016 23,269 23,842 ------------ 185,354 ------------ Fannie Mae 10.4% 6.840% due 11/01/2027 (d) 661 670 6.857% due 09/01/2028 (d) 1,748 1,772 7.490% due 10/01/2030 (d) 2,377 2,447 7.500% due 08/01/2029-09/01/2029 (f) 4,860 4,974 7.508% due 10/01/2030 (d) 5,855 6,029 7.510% due 08/01/2030-11/01/2039 (d)(f) 11,981 12,335 8.000% due 04/16/2031 36,000 37,125 8.250% due 01/01/2024 (d) 582 587 10.500% due 05/01/2012 615 676 ------------ 66,615 ------------ Federal Housing Administration 4.0% 7.200% due 05/01/2009 1,656 1,647 7.430% due 07/01/2024 23,636 23,575 ------------ 25,222 ------------ Freddie Mac 0.2% 6.500% due 06/01/2001 110 110 8.000% due 07/01/2024 241 252 8.500% due 06/01/2009-10/01/2010 236 244 8.581% due 07/01/2023 (d) 486 498 10.500% due 09/01/2015 8 8 ------------ 1,112 ------------ Government National Mortgage Association 85.0% 6.500% due 08/15/2023-04/23/2031 (d)(f) 52,822 52,887 7.000% due 03/15/2022-11/15/2023 (f) 16,064 16,398 7.375% due 04/20/2022-05/20/2027 (d)(f) 10,948 11,124 7.500% due 02/15/2022-04/23/2031 (f) 150,584 154,413 7.620% due 10/20/2025 (d) 7,320 7,504 7.750% due 07/20/2023-07/20/2025 (d)(f) 7,586 7,769 8.000% due 03/15/2023-04/23/2031 (f) 228,153 235,162 8.500% due 11/15/2029-01/15/2031 (f) 44,626 46,358 9.000% due 07/20/2016-10/15/2030 (f) 9,030 9,435 ------------ 541,050 ------------ Total Mortgage-Backed Securities 819,353 (Cost $813,967) ------------ -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 5.7% -------------------------------------------------------------------------------- Bay View Auto Trust 6.880% due 02/15/2003 2,138 2,148 Countrywide Asset-Backed Certificates 6.130% due 03/25/2031 (d) 77 76 Countrywide Home Equity Loan Trust 5.403% due 08/15/2025 (d) 6,715 6,713 Embarcadero Aircraft Securitization Trust 5.643% due 08/15/2025 (d) 3,013 3,013 First Alliance Mortgage Loan Trust 5.387% due 03/20/2031 (d) 9,806 9,819 Green Tree Financial Corp. 6.750% due 07/15/2025 37 38 Novastar Home Equity Loan 5.400% due 01/25/2030 (d) 8,097 8,107 The Money Store Home Equity Trust 6.490% due 10/15/2026 6,091 6,174 ------------ Total Asset-Backed Securities 36,088 (Cost $36,039) ------------ -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Government National Mortgage Association (OTC) 7.500% due 06/20/2031 Strike @ 96.625 Exp. 06/13/2001 131,000 5 ------------ Total Purchased Put Options 5 (Cost $10) ------------ -------------------------------------------------------------------------------- PREFERRED SECURITY 0.8% -------------------------------------------------------------------------------- Shares DG Funding Trust 7.152% due 12/29/2020 (d) 510 5,202 ------------ Total Preferred Security 5,202 (Cost $5,100) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 1.7% -------------------------------------------------------------------------------- Principal Amount (000s) Commercial Paper 0.6% American Express Credit Corp. 4.860% due 05/15/2001 $ 1,500 1,491 Fannie Mae 4.695% due 09/06/2001 800 784 General Electric Capital Corp. 5.410% due 04/03/2001 500 500 5.200% due 04/18/2001 100 100 4.940% due 05/30/2001 800 794 National Rural Utilities Cooperative Finance Corp. 4.880% due 05/25/2001 400 397 ------------ 4,066 ------------ Repurchase Agreement 1.0% State Street Bank 4.600% due 04/02/2001 6,617 6,617 (Dated 03/30/2001. Collateralized by Freddie Mac ------------ 7.000% due 03/15/2010 valued at $6,753. Repurchase proceeds are $6,620.) U.S. Treasury Bills 0.1% 4.760% due 05/17/2001 (b)(c) 145 144 ------------ Total Short-Term Instruments 10,827 (Cost $10,827) ------------ Total Investments (a) 178.3% $ 1,134,937 (Cost $1,125,719) Other Assets and Liabilities (Net) (78.3%) (498,313) ------------ Net Assets 100.0% $ 636,624 ------------ 108 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,126,129 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 10,841 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (2,033) ------------ Unrealized appreciation-net $ 8,808 ------------ (b) Securities with an aggregate market value of $478 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 2 Year Note (06/2001) 93 $ (66) U.S. Treasury 5 Year Note (06/2001) 8 (4) ------------ $ (70) ------------ (c) Subject to financing transaction. (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Principal amount of the security is adjusted for inflation. (f) Securities are grouped by coupon or range of coupons and represent a range of maturities. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 109 Schedule of Investments Low Duration Fund III March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 40.9% -------------------------------------------------------------------------------- Banking & Finance 16.9% Bank of America Corp. 8.125% due 02/01/2002 $ 1,000 $ 1,025 CIT Group, Inc. 5.190% due 09/13/2002 (d) 400 399 General Motors Acceptance Corp. 6.396% due 01/20/2004 (d) 1,000 1,000 5.999% due 07/21/2004 (d) 200 198 Goldman Sachs Group, Inc. 5.810% due 02/18/2002 (d) 665 668 Korea Development Bank 7.625% due 10/01/2002 1,000 1,026 National Rural Utilities Cooperative Finance Corp. 5.721% due 08/13/2002 (d) 1,000 1,000 Salomon, Smith Barney Holdings 5.567% due 05/14/2002 (d) 325 325 Spieker Properties LP - REITS 7.580% due 12/17/2001 1,000 1,016 Western Capital 10.665% due 01/07/2003 600 600 ------------ 7,257 ------------ Industrials 4.7% Cargill, Inc. 5.818% due 01/14/2002 (d) 1,000 1,000 TRW, Inc. 6.450% due 06/15/2001 1,000 999 ------------ 1,999 ------------ Utilities 19.3% British Telecommunications PLC 7.625% due 12/15/2005 200 207 Consolidated Edison, Inc. 5.093% due 06/15/2002 (d) 500 501 Entergy Gulf States, Inc. 6.410% due 08/01/2001 1,000 1,003 Florida Power & Light 6.875% due 12/01/2005 1,000 1,047 France Telecom 7.200% due 03/01/2006 300 305 Niagara Mohawk Power Co. 7.125% due 07/01/2001 756 759 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(j) 400 330 Philadelphia Electric 6.500% due 05/01/2003 1,500 1,532 Telekomunikacja Polska SA 7.125% due 12/10/2003 1,000 1,004 WorldCom, Inc. 6.125% due 08/15/2001 1,600 1,603 ------------ 8,291 ------------ Total Corporate Bonds & Notes 17,547 (Cost $17,408) ------------ -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 9.1% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (h) 3.625% due 07/15/2002 (b) 219 223 3.375% due 01/15/2007 2,984 3,017 3.625% due 01/15/2008 325 333 3.875% due 01/15/2009 320 333 ------------ Total U.S. Treasury Obligations 3,906 (Cost $3,825) ------------ -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 113.6% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 29.3% Bear Stearns Adjustable Rate Mortgage Trust 7.499% due 12/25/2030 (d) 180 182 7.490% due 12/25/2030 (d) 190 192 Countrywide Home Loans 7.750% due 04/25/2030 76 77 CS First Boston Mortgage Securities Corp. 7.500% due 02/25/2031 1,549 1,593 First Nationwide Trust 7.750% due 10/25/2030 2,037 2,112 Freddie Mac 5.613% due 11/15/2030 (d) 929 933 GMAC Commercial Mortgage Securities, Inc. 6.570% due 09/15/2033 886 911 Independent National Mortgage Corp. 7.250% due 11/25/2010 884 892 PNC Mortgage Securities Corp. 7.750% due 07/25/2030 505 518 Prudential Home Mortgage Securities 7.500% due 08/25/2024 921 949 Residential Funding Mortgage Securities I 7.750% due 11/25/2026 1,000 1,041 Salomon Brothers Mortgage Securities VII 7.599% due 11/25/2030 173 176 Structured Asset Securities Corp. 6.750% due 07/25/2029 1,373 1,387 Washington Mutual, Inc. 7.170% due 01/25/2040 (d) 98 101 Wells Fargo Mortgage-Backed Securities Trust 7.000% due 02/25/2016 1,472 1,508 ------------ 12,572 ------------ Fannie Mae 2.7% 7.508% due 09/01/2040 (d) 1,125 1,158 ------------ Freddie Mac 0.2% 8.750% due 10/01/2001 88 88 ------------ Government National Mortgage Association 81.4% 6.500% due 04/23/2031 (d) 1,000 1,000 7.000% due 05/20/2030-04/23/2031 (d)(i) 2,752 2,785 7.375% due 06/20/2027 (d) 506 513 7.500% due 04/23/2031 7,500 7,686 8.000% due 04/23/2031 19,900 20,533 8.500% due 10/20/2026-10/15/2030 (i) 2,365 2,452 ------------ 34,969 ------------ Total Mortgage-Backed Securities 48,787 (Cost $48,503) ------------ -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 6.1% -------------------------------------------------------------------------------- Bayview Financial Acquisition Trust 5.920% due 11/25/2030 (d) 1,300 1,300 Circuit City Credit Card Master Trust 5.393% due 02/15/2006 (d) 1,000 1,001 SallieMae 5.769% due 10/25/2005 (d) 305 305 ------------ Total Asset-Backed Securities 2,606 (Cost $2,604) ------------ -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Government National Mortgage Association (OTC) 7.000% due 05/21/2031 Strike @ 94.625 Exp. 05/04/2001 1,000 0 ------------ Total Purchased Put Options 0 (Cost $0) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 4.4% -------------------------------------------------------------------------------- Commercial Paper 3.9% American Express Credit Corp. 4.860% due 05/15/2001 300 298 Fannie Mae 4.685% due 09/06/2001 500 490 General Electric Capital Corp. 4.600% due 07/18/2001 300 296 Swedbank, Inc. 5.150% due 04/25/2001 400 399 4.790% due 08/15/2001 200 196 ------------ 1,679 ------------ 110 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Repurchase Agreement 0.5% State Street Bank 4.600% due 04/02/2001 $ 203 $ 203 ------------ (Dated 03/30/2001. Collateralized by Freddie Mac 5.500% due 02/13/2004 valued at $212. Repurchase proceeds are $203.) U.S. Treasury Bills 0.0% 4.910% due 05/17/2001 (b) 1 1 ------------ Total Short-Term Instruments 1,883 (Cost $1,883) ------------ Total Investments (a) 174.1% $ 74,729 (Cost $74,223) Written Options (c) (0.0%) (19) (Premiums $21) Other Assets and Liabilities (Net) (74.1%) (31,775) ------------ Net Assets 100.0% $ 42,935 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $74,223 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 593 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (87) ------------ Unrealized appreciation-net $ 506 ------------ (b) Securities with an aggregate market value of $224 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 2 Year Note (06/2001) 8 $ (6) U.S. Treasury 5 Year Note (06/2001) 5 2 U.S. Treasury 30 Year Bond (06/2001) 15 (5) Euribor Futures (03/2002) 3 3 ------------ $ (6) ------------ (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/31/2001 300,000 $ 2 $ 4 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 300,000 3 4 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 06/04/2001 300,000 2 5 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 12/03/2001 100,000 2 1 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/27/2001 200,000 6 2 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/21/2001 200,000 6 3 ------------------ $ 21 $ 19 ------------------ (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) ------------------------------------------------------------ Buy EC 1,371 04/2001 $ (73) Sell 1,371 04/2001 10 Buy 971 06/2001 (3) ---------- $ (66) ---------- (f) Principal amount denoted in indicated currency: BP - British Pound EC - Euro JY - Japanese Yen (g) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive a fixed rate equal to 5.633% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/02/2004 BP 200 $ 2 Receive a fixed rate equal to 5.626% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 02/02/2004 800 8 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.805%. Broker: Morgan Stanley Exp. 01/11/2011 JY 129,000 (45) Receive a fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/02/2004 BP 1,700 17 Receive a fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/02/2004 900 9 ------------ $ (9) ------------ (h) Principal amount of the security is adjusted for inflation. (i) Securities are grouped by coupon or range of coupons and represent a range of maturities. (j) Security is in default. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 111 Schedule of Investments Short-Term Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 63.1% -------------------------------------------------------------------------------- Banking & Finance 36.6% ABN AMRO Bank 6.625% due 10/31/2001 $ 2,000 $ 2,019 AT&T Capital Corp. 7.000% due 08/15/2001 2,300 2,313 Banco Nacional Obra Services 9.625% due 11/15/2003 3,900 4,115 Bank One Corp. 5.681% due 01/24/2002 (d) 2,000 2,002 BankBoston Corp. 6.125% due 03/15/2002 1,000 1,010 Bear Stearns Co., Inc. 5.270% due 09/21/2004 (d) 3,900 3,901 Chrysler Financial Corp. LLC 5.690% due 11/15/2001 1,200 1,204 CIT Group, Inc. 5.190% due 09/13/2002 (d) 6,300 6,282 Citigroup, Inc. 5.500% due 08/19/2003 (d) 11,040 11,273 DaimlerChrysler Financial Services North America LLC 5.250% due 10/22/2001 2,800 2,788 Dime Bancorp, Inc. 7.000% due 07/25/2001 2,400 2,406 Donaldson, Lufkin & Jenrette, Inc. 6.258% due 07/18/2003 (d) 8,000 8,024 DQE Capital Corp. 6.178% due 01/15/2002 (d) 2,000 2,001 Export-Import Bank Korea 6.500% due 02/10/2002 (d) 1,000 1,006 First USA Bank 5.458% due 05/15/2002 (d) 6,000 5,999 Ford Credit Canada 5.180% due 12/16/2002 (d) 10,000 9,990 Ford Motor Credit Co. 5.400% due 08/27/2006 (d) 6,840 6,840 5.092% due 03/19/2002 (d) 4,295 4,286 5.322% due 06/02/2003 (d) 2,500 2,497 6.178% due 07/18/2005 (d) 10,000 9,842 General Motors Acceptance Corp. 5.510% due 08/18/2003 (d) 16,575 16,560 6.396% due 01/20/2004 (d) 3,900 3,900 Golden State Holdings 6.750% due 08/01/2001 (d) 7,000 6,984 Goldman Sachs Group, Inc. 5.971% due 01/17/2003 (d) 5,000 5,009 Heller Financial, Inc. 5.116% due 06/25/2001 (d) 800 800 5.888% due 04/22/2002 (d) 12,900 12,899 6.500% due 07/22/2002 1,000 1,015 Korea Development Bank 7.125% due 09/17/2001 2,604 2,621 7.900% due 02/01/2002 900 913 7.625% due 10/01/2002 2,500 2,564 Lehman Brothers Holdings, Inc. 6.110% due 05/07/2002 (d) 3,000 3,016 6.771% due 04/04/2003 (d) 3,000 3,004 MBNA Corp. 5.360% due 09/13/2001 (d) 5,000 5,005 Merrill Lynch & Co. 5.805% due 08/01/2003 (d) 4,000 4,011 Morgan Stanley, Dean Witter & Co. 5.722% due 01/28/2002 (d) 8,600 8,616 National Consumer Coop Bank 7.151% due 04/02/2001 (d) 16,000 16,000 6.410% due 10/26/2001 (d) 10,000 10,010 Paine Webber Group, Inc. 6.238% due 07/15/2002 (d) 10,000 10,057 Protective Life Funding Trust 6.088% due 01/17/2003 (d) 2,000 2,003 PS Colorado Credit Corp. 5.843% due 05/30/2002 (d) 2,000 1,998 Qwest Capital Funding, Inc. 6.875% due 08/15/2001 15,430 15,522 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 3,312 3,330 6.018% due 07/18/2007 (d) 5,000 5,011 Transamerica Finance Corp. 5.307% due 12/14/2001 (d) 4,000 4,001 U.S. Bancorp 5.755% due 02/03/2003 (d) 3,700 3,714 ------------ 238,361 ------------ Industrials 15.2% Air Canada 6.037% due 07/31/2005 (d) 1,636 1,516 Clear Channel Communications, Inc. 5.583% due 06/15/2002 (d) 900 903 Coastal Corp. 6.125% due 07/21/2003 (d) 5,000 5,014 DaimlerChrysler North America Holding Corp. 6.670% due 09/25/2001 2,000 2,016 6.670% due 02/15/2002 5,900 5,989 5.640% due 08/23/2002 (d) 5,800 5,752 5.153% due 09/16/2002 (d) 7,000 6,921 5.790% due 12/16/2002 (d) 2,100 2,091 Enron Corp. 5.510% due 09/10/2001 (d) 3,000 3,002 HCA - The Healthcare Co. 6.442% due 09/19/2002 (d) 10,000 9,999 Lockheed Martin Corp. 6.850% due 05/15/2001 10,000 10,014 Petroleos Mexicanos 7.768% due 07/15/2005 (d) 2,000 2,005 9.375% due 12/02/2008 1,000 1,043 Racers 5.713% due 03/03/2003 (d) 10,000 10,005 Raytheon Co. 5.738% due 08/10/2001 (d) 10,000 10,012 Safeway, Inc. 7.000% due 09/15/2002 9,300 9,471 Staples, Inc. 6.195% due 11/26/2001 (d) 1,400 1,402 Time Warner, Inc. 6.100% due 12/30/2001 3,000 3,012 Tyco International Group SA 6.125% due 06/15/2001 6,074 6,079 Waste Management, Inc. 7.125% due 06/15/2001 3,000 3,004 ------------ 99,250 ------------ Utilities 11.3% Allete 6.498% due 10/20/2003 (d) 8,800 8,809 Appalachian Power Co. 5.360% due 06/27/2001 (d) 900 900 British Telecommunications PLC 6.078% due 12/15/2003 (d) 5,000 5,002 Central Power & Light Co. 5.830% due 02/22/2002 (d) 2,000 2,002 CenturyTel, Inc. 7.750% due 10/15/2002 2,000 2,037 Commonwealth Edison Co. 5.527% due 09/30/2003 (d) 2,000 2,001 Deutsche Telekom AG 7.750% due 06/15/2005 5,000 5,166 Dominion Resources, Inc. 5.683% due 09/16/2002 (d) 6,500 6,526 Exelon Corp. 5.625% due 11/01/2001 2,000 2,006 Indiana Michigan Power Co. 5.713% due 09/03/2002 (d) 1,000 1,001 Nevada Power Co. 5.990% due 08/20/2001 (d) 5,000 5,005 Oneok, Inc. 6.231% due 04/24/2002 (d) 5,000 5,009 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (c)(d) 1,900 1,568 7.375% due 11/01/2005 (c) 5,000 3,825 112 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Sierra Pacific Resources 6.298% due 04/20/2002 (d) $ 3,000 $ 2,550 6.248% due 04/20/2003 (d) 5,000 4,251 Texas Utilities Electric Co. 5.650% due 12/20/2002 (d) 3,090 3,091 Williams Cos., Inc. 5.888% due 11/15/2001 (d) 7,500 7,511 WorldCom, Inc. 5.575% due 11/26/2001 (d) 3,700 3,690 7.375% due 01/15/2003 1,500 1,518 ------------ 73,468 ------------ Total Corporate Bonds & Notes 411,079 (Cost $412,244) ------------ -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.3% -------------------------------------------------------------------------------- North Carolina 0.3% North Carolina State Education Assistance Authority Revenue Bonds, (GTD Insured), Series 2000 5.263% due 06/01/2009 (d) 2,000 2,000 ------------ Total Municipal Bonds & Notes 2,000 (Cost $2,000) ------------ -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 24.5% -------------------------------------------------------------------------------- Fannie Mae 5.750% due 04/15/2003 850 869 Federal Home Loan Bank 6.750% due 02/01/2002 70,000 70,244 6.375% due 11/15/2002 86,200 88,571 ------------ Total U.S. Government Agencies 159,684 (Cost $156,977) ------------ -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 44.4% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (k) 3.625% due 07/15/2002 149,347 152,287 3.625% due 01/15/2008 (j) 65,247 66,777 U.S. Treasury Notes 6.375% due 01/31/2002 70,000 70,175 ------------ Total U.S. Treasury Obligations 289,239 (Cost $286,251) ------------ -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 28.6% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 15.4% Bayview Financial Revolving Mortgage 6.350% due 08/25/2029 (d) 2,000 2,017 CDC Depositor Trust I 5.642% due 12/14/2001 (d) 361 362 CMC Securities Corp. 7.500% due 02/25/2023 814 812 Dime Savings 7.292% due 11/01/2018 (d) 170 157 DLJ Acceptance Trust 8.290% due 10/17/2020 (d) 433 444 DLJ Mortgage Acceptance Corp. 7.788% due 09/01/2021 (d) 20 20 Donaldson, Lufkin & Jenrette, Inc. 6.227% due 05/01/2026 (d) 78 79 Fannie Mae 7.250% due 04/25/2007 604 604 6.000% due 02/25/2008 862 866 6.264% due 07/25/2008 (d) 1,216 1,218 6.000% due 12/18/2014 2,874 2,875 6.250% due 06/18/2015 867 869 6.000% due 08/18/2016 22,706 22,828 6.150% due 09/25/2016 3,233 3,233 7.000% due 09/18/2017 6,056 6,083 5.650% due 10/25/2017 (d) 4,539 4,573 5.875% due 03/25/2018 15 15 7.000% due 12/25/2019 9,025 9,081 6.000% due 08/25/2020 1,585 1,586 5.000% due 02/25/2022 7 7 6.500% due 09/18/2023 1,520 1,536 8.915% due 06/25/2032 7,877 8,286 First Nationwide Trust 7.357% due 10/25/2018 (d) 3 3 Freddie Mac 7.000% due 08/15/2006 3,680 3,730 6.750% due 03/15/2007 585 589 6.500% due 10/25/2014 3,503 3,538 6.000% due 01/15/2019 786 789 6.000% due 07/15/2019 3,161 3,168 5.437% due 06/15/2023 (d) 362 363 General Electric Capital Mortgage Services, Inc. 6.750% due 12/25/2012 4,395 4,433 Greenwich Capital Acceptance, Inc. 7.709% due 04/25/2022 (d) 48 48 8.056% due 10/25/2022 (d) 19 19 Housing Securities, Inc. 6.000% due 02/25/2008 94 94 Independent National Mortgage Corp. 7.250% due 11/25/2010 3,534 3,570 Prudential Home Mortgage Securities 6.950% due 11/25/2022 233 230 Prudential-Bache Trust 6.764% due 09/01/2018 (d) 20 20 Residential Funding Mortgage Securities, Inc. 7.142% due 12/01/2018 930 949 Resolution Trust Corp. 7.441% due 05/25/2029 (d) 483 494 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 7,767 7,767 Washington Mutual 7.174% due 01/25/2040 2,952 3,044 ------------ 100,399 ------------ Fannie Mae 0.5% 7.000% due 06/01/2003 1,885 1,918 8.500% due 01/01/2026 1,453 1,519 ------------ 3,437 ------------ Freddie Mac 0.1% 7.500% due 11/01/2001 756 760 ------------ Government National Mortgage Association 12.5% 6.000% due 04/20/2030-05/20/2030 (d)(e) 23,076 23,279 6.500% due 03/20/2030 (d) 22,861 23,055 7.375% due 02/20/2024 (d) 9,220 9,353 7.380% due 04/20/2025 (d) 419 426 7.625% due 11/20/2026 (d) 10,231 10,485 7.750% due 09/20/2023-08/20/2027 (d)(e) 6,083 6,229 8.000% due 04/23/2031 3,950 4,077 8.500% due 06/20/2027 4,160 4,307 ------------ 81,211 ------------ Stripped Mortgage-Backed Securities 0.1% ABN AMRO Mortgage Corp. (IO) 6.750% due 08/25/2029 517 42 Fannie Mae (IO) 7.000% due 07/25/2006 776 21 6.500% due 06/25/2017 74 0 6.500% due 10/25/2023 1,074 120 Freddie Mac (IO) 7.000% due 06/15/2019 2,976 140 ------------ 323 ------------ Total Mortgage-Backed Securities 186,130 (Cost $184,862) ------------ -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 9.1% -------------------------------------------------------------------------------- Advanta Revolving Home Equity Loan Trust 5.420% due 01/25/2024 (d) 187 187 American Residential Eagle Trust 5.390% due 07/25/2029 (d) 1,454 1,458 Associates Manufactured Housing 7.000% due 03/15/2027 163 164 Brazos Student Loan Finance Co. 6.475% due 06/01/2023 (d) 20,000 19,955 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 113 Schedule of Investments (Cont.) Short-Term Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Capital Asset Research Funding LP 6.400% due 12/15/2004 $ 1,542 $ 1,544 CS First Boston Mortgage Securities Corp. 5.423% due 12/15/2030 (d) 3,842 3,846 Delta Funding Home Equity Loan Trust 5.573% due 09/15/2029 (d) 1,543 1,549 First Security Auto Owner Trust 5.580% due 06/15/2003 3,546 3,554 Ford Credit Auto Owner Trust 5.810% due 03/15/2002 121 122 Green Tree Home Improvement Loan Trust 5.333% due 08/15/2029 (d) 1,497 1,495 Metris Master Trust 5.657% due 04/20/2006 (d) 6,000 6,043 MLCC Mortgage Investors, Inc. 5.543% due 03/15/2025 (d) 2,763 2,774 Onyx Acceptance Auto Trust 6.180% due 04/15/2002 2 2 Salomon Brothers Mortgage Securities VII 5.390% due 12/25/2029 (d) 3,934 3,944 5.400% due 07/25/2029 (d) 2,731 2,736 5.743% due 12/15/2029 (d) 2,000 2,006 7.768% due 11/15/2029 (d) 1,369 1,375 Saxon Asset Securities Trust 7.585% due 12/25/2014 3,100 3,121 The Money Store Home Equity Trust 6.635% due 09/15/2014 2,163 2,167 6.345% due 11/15/2021 60 60 UAF Auto Grantor Trust 6.100% due 06/15/2004 676 681 UniCapital Equipment Contract 6.540% due 07/23/2002 435 435 USAA Auto Loan Grantor Trust 5.800% due 01/15/2005 213 214 ------------ Total Asset-Backed Securities 59,432 (Cost $59,230) ------------ -------------------------------------------------------------------------------- SOVEREIGN ISSUES 0.6% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (d) 1,760 1,595 Republic of Croatia 7.000% due 02/27/2002 1,000 1,002 Republic of Panama 7.875% due 02/13/2002 1,000 1,009 ------------ Total Sovereign Issues 3,606 (Cost $3,669) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 7.2% -------------------------------------------------------------------------------- Commercial Paper 7.1% Abbey National North America 5.070% due 05/02/2001 300 299 American Express Credit Corp. 5.150% due 04/04/2001 10,000 9,997 Coca-Cola Co. 4.990% due 04/12/2001 1,700 1,698 Federal Home Loan Bank 4.675% due 09/07/2001 1,900 1,860 General Electric Capital Corp. 5.290% due 06/06/2001 200 198 H.J. Heinz Co. 4.860% due 05/01/2001 3,000 2,988 Morgan Stanley, Dean Witter, Discover & Co. 5.050% due 04/11/2001 10,000 9,987 National Rural Utilities Cooperative Finance Corp. 4.910% due 05/25/2001 10,000 9,928 Reseau Ferre De France 4.620% due 08/16/2001 4,000 3,927 UBS Finance, Inc. 5.830% due 06/06/2001 100 99 Williams Cos., Inc. 7.231% due 04/10/2001 5,600 5,602 ------------ 46,583 ------------ Repurchase Agreement 0.1% State Street Bank 4.600% due 04/02/2001 424 424 ------------ (Dated 03/30/2001. Collateralized by Freddie Mac 7.000% due 03/15/2010 valued at $435. Repurchase proceeds are $424.) U.S. Treasury Bills 0.0% 4.890% due 05/17/2001 (b) 50 50 ------------ Total Short-Term Instruments 47,057 (Cost $47,059) ------------ Total Investments (a) 177.8% $ 1,158,227 (Cost $1,152,292) Other Assets and Liabilities (Net) (77.8%) (507,054) ------------ Net Assets 100.0% $ 651,173 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,152,249 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 9,111 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (3,133) ------------ Unrealized appreciation-net $ 5,978 ------------ (b) Securities with an aggregate market value of $50 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts Appreciation -------------------------------------------------------------------------------- United Kingdom 90 Day LIBOR Futures (03/2002) 30 $ 23 United Kingdom 90 Day LIBOR Futures (06/2002) 30 22 United Kingdom 90 Day LIBOR Futures (09/2002) 30 21 United Kingdom 90 Day LIBOR Futures (12/2002) 30 22 ------------ $ 88 ------------ (c) Security is in default. (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Securities are grouped by coupon or range of coupons and represent a range of maturities. (f) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Covered by Settlement Unrealized Type Currency Contract Month Appreciation -------------------------------------------------------------------------------- Sell BP 525 05/2001 $ 25 Sell N$ 40 04/2001 1 ------------ $ 26 ------------ (g) Principal amount denoted in indicated currency: BP - British Pound N$ - New Zealand Dollar 114 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes (h) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 0.470% and pay a fixed rate equal to 7.750%. Broker: Morgan Stanley Exp. 06/15/2005 $ 5,000 $ (367) Receive fixed rate equal to 0.430% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 07/11/2003 5,000 0 Receive fixed rate equal to 0.230% and the Fund will pay to the counterparty at par in the event of default of Associates Corp. 6.000% due 04/15/2003. Broker: Warburg Dillon Read LLC Exp. 01/14/2003 4,000 0 ------------ $ (367) ------------ (i) Reverse repurchase agreements were entered into on various days paying various interest rates. The following securities were segregated with collateral for reverse repurchase agreements: Type Maturity Value -------------------------------------------------------------------------------- Entered into on March 26, 2001 paying interest at 4.880% Government National Mortgage Assn. 7.375% 02/20/2024 $ 9,353 Government National Mortgage Assn. 7.625% 11/20/2026 10,485 Government National Mortgage Assn. 6.000% 05/20/2030 11,116 Government National Mortgage Assn. 6.000% 04/20/2030 12,163 Entered into on March 27, 2001 paying interest at 4.940% Fannie Mae 7.000% 12/25/2019 9,081 Fannie Mae 6.000% 08/18/2016 22,828 ------------ $ 75,026 ------------ (j) Subject to financing transaction. (k) Principal amount of the security is adjusted for inflation. (l) Short sales open at March 31, 2001 was as follows: Coupon Type (%) Maturity Par Value Proceeds -------------------------------------------------------------------------------- U.S. Treasury Notes 5.750 10/31/20 87,500 $ 89,587 $ 87,412 U.S. Treasury Notes 6.375 01/31/20 70,000 70,172 70,113 U.S. Treasury Notes 3.625 07/15/20 64,671 65,944 65,495 Federal Home Loan Bank 6.750 02/01/20 7,000 70,247 70,094 -------------------- $ 295,950 $ 293,114 -------------------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 115 Schedule of Investments Money Market Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 32.0% -------------------------------------------------------------------------------- Banking & Finance 28.7% ABN AMRO Mortgage Corp. 5.010% due 04/02/2001 $ 4,700 $ 4,700 Bank of America Corp. 5.110% due 06/11/2001 (a) 1,000 1,000 6.538% due 09/26/2001 (a) 9,000 9,001 6.960% due 10/26/2001 (a) 1,550 1,551 Bayerische Landesbank Girozentrale 6.800% due 09/28/2001 1,000 1,009 Citigroup, Inc. 6.741% due 08/13/2001 (a) 235 235 First USA Bank 5.408% due 05/10/2001 (a) 10,900 10,900 First Chicago NBD Corp. 6.818% due 08/20/2001 (a) 14,300 14,304 General Electric Capital Corp. 5.770% due 08/27/2001 5,650 5,660 6.672% due 09/04/2001 (a) 5,100 5,100 6.350% due 09/15/2001 3,775 3,791 Goldman Sachs Group, Inc. 4.920% due 04/04/2001 11,900 11,897 5.777% due 01/28/2002 (a) 2,000 2,002 Merrill Lynch & Co. 5.400% due 04/11/2001 3,000 2,996 5.471% due 05/30/2001 (a) 2,000 2,000 5.478% due 08/10/2001 (a) 4,100 4,101 Morgan Stanley, Dean Witter & Co. 5.593% due 08/15/2001 (a) 6,000 6,000 National Rural Utilities Cooperative Finance Corp. 4.950% due 04/24/2001 3,700 3,689 5.240% due 05/24/2001 700 695 5.340% due 05/24/2001 9,700 9,625 ------------- 100,256 ------------- Industrials 3.3% Monsanto Co. 4.980% due 08/15/2001 300 294 Wal-Mart Stores, Inc. 6.150% due 08/10/2001 4,200 4,215 Walt Disney Co. 5.070% due 04/03/2001 6,900 6,899 ------------- 11,408 ------------- Total Corporate Bonds & Notes 111,664 (Cost $111,664) ------------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 1.7% -------------------------------------------------------------------------------- Republic of Ireland 7.875% due 12/01/2001 1,000 1,020 Republic of Italy 4.806% due 06/28/2001 (a) 5,000 5,004 ------------- Total Sovereign Issues 6,024 (Cost $6,024) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 66.6% -------------------------------------------------------------------------------- Certificates of Deposit 5.2% First Union National Bank 5.543% due 08/24/2001 (a) 18,300 18,312 ------------- Commercial Paper 61.0% Abbey National North America 4.920% due 04/26/2001 5,200 5,183 5.420% due 04/26/2001 3,700 3,687 5.020% due 08/08/2001 1,200 1,179 4.710% due 09/06/2001 4,500 4,408 Abbott Laboratories 5.100% due 04/03/2001 5,200 5,199 Alcoa, Inc. 5.400% due 04/25/2001 1,400 1,395 4.950% due 04/30/2001 11,600 11,555 5.120% due 05/23/2001 1,500 1,489 American Express Credit Corp. 4.990% due 04/06/2001 8,800 8,795 Anz, Inc. 5.520% due 04/18/2001 15,000 14,963 Bellsouth Corp. 5.340% due 04/11/2001 9,400 9,387 CBA (de) Finance 4.960% due 04/23/2001 9,600 9,572 5.310% due 06/05/2001 2,500 2,476 5.020% due 08/09/2001 3,200 3,142 Coca-Cola Co. 6.260% due 04/12/2001 4,800 4,792 5.120% due 04/12/2001 7,800 7,789 Federal Home Loan Bank 4.675% due 09/07/2001 18,900 18,512 Freddie Mac 5.130% due 04/03/2001 600 600 Gannett Co., Inc. 5.370% due 04/16/2001 3,500 3,493 General Electric Capital Corp. 5.410% due 04/04/2001 800 800 Gillette Co. 5.500% due 04/18/2001 8,700 8,679 H.J. Heinz Co. 5.000% due 04/20/2001 4,100 4,090 KFW International Finance, Inc. 5.400% due 04/18/2001 5,300 5,287 5.170% due 06/27/2001 1,800 1,778 5.000% due 08/08/2001 8,400 8,251 Merck & Co., Inc. 5.450% due 04/02/2001 6,100 6,100 National Australia Funding, Inc. 5.100% due 04/05/2001 15,000 14,994 Swedbank, Inc. 5.390% due 04/12/2001 1,700 1,697 6.260% due 04/12/2001 1,300 1,298 UBS Finance, Inc. 4.970% due 08/01/2001 6,700 6,588 5.010% due 08/01/2001 6,100 5,997 USAA Capital Corp. 4.970% due 04/18/2001 15,000 14,967 Verizon Global Funding Corp. 4.950% due 05/07/2001 14,500 14,430 ------------- 212,572 ------------- Repurchase Agreement 0.4% State Street Bank 4.600% due 04/02/2001 1,466 1,466 ------------- (Dated 03/30/2001. Collateralized by Freddie Mac 7.000% due 03/15/2010 valued at $1,501. Repurchase proceeds are $1,467.) Total Short-Term Instruments 232,350 (Cost $232,350) ------------- Total Investments 100.3% $ 350,038 (Cost $350,038) Other Assets and Liabilities (Net) (1,108) (0.3%) ------------- Net Assets 100.0% $ 348,930 ------------- (a) Variable rate security. The rate listed is as of March 31, 2001. 116 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments Long-Term U.S. Government Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 6.6% -------------------------------------------------------------------------------- Banking & Finance 3.9% Associates Corp. of North America 5.800% due 04/20/2004 $ 2,500 $ 2,526 Bank One Corp. 5.462% due 05/07/2002 (d) 2,400 2,401 Countrywide Home Loans 6.850% due 06/15/2004 1,500 1,550 Ford Motor Credit Co. 6.985% due 06/02/2003 (d) 1,900 1,897 Goldman Sachs Group, Inc. 7.338% due 01/14/2002 (d) 3,000 3,015 Morgan Stanley, Dean Witter & Co. 7.010% due 04/22/2004 (d) 2,500 2,502 National Rural Utilities Cooperative Finance Corp. 5.721% due 08/13/2002 (d) 5,000 5,001 ------------- 18,892 ------------- Industrials 1.7% DaimlerChrysler North America Holding Corp. 7.750% due 05/27/2003 5,000 5,174 7.001% due 08/16/2004 (d) 3,000 2,924 ------------- 8,098 ------------- Utilities 1.0% Pacific Gas & Electric Co. 7.375% due 11/01/2005 (h) 3,000 2,295 Scana Corp. 7.448% due 07/15/2002 (d) 2,000 2,004 WorldCom, Inc. 6.980% due 11/26/2001 (d) 700 698 ------------- 4,997 ------------- Total Corporate Bonds & Notes 31,987 (Cost $32,578) ------------- -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.9% -------------------------------------------------------------------------------- California 0.9% Kern County California Pension Obligation Revenue Bonds, (MBIA Insured), Series 1995 7.260% 3,900 4,205 due 08/15/2014 ------------- Total Municipal Bonds & Notes 4,205 (Cost $4,074) ------------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 12.9% -------------------------------------------------------------------------------- Fannie Mae 6.850% due 11/06/2003 4,000 4,055 6.470% due 04/15/2009 1,000 1,010 0.000% due 01/15/2010 16,800 18,568 7.125% due 06/15/2010 3,500 3,852 7.125% due 01/15/2030 580 646 Federal Farm Credit Bank 6.000% due 03/07/2011 20,000 20,205 Federal Home Loan Bank 5.950% due 12/10/2008 250 248 6.410% due 09/30/2013 500 492 6.650% due 10/21/2013 300 298 Resolution Funding Corp. Principle Strip 0.000% due 01/15/2030 5,000 910 SallieMae 6.694% due 01/25/2007 (d) 498 499 Tennessee Valley Authority 7.125% due 05/01/2030 10,000 11,074 ------------- Total U.S. Government Agencies 61,857 (Cost $60,000) ------------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 60.4% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (f) 3.625% due 07/15/2002 (b) 12,026 12,263 3.625% due 01/15/2008 (g) 16,251 16,632 3.625% due 04/15/2028 3,248 3,312 3.875% due 04/15/2029 2,130 2,274 U.S. Treasury Bonds 14.000% due 11/15/2011 (g) 10,000 14,435 9.250% due 02/15/2016 9,800 13,538 8.875% due 08/15/2017 5,200 7,060 8.750% due 08/15/2020 (g) 52,800 72,436 8.125% due 05/15/2021 5,600 7,291 7.125% due 02/15/2023 (g) 4,000 4,751 6.250% due 08/15/2023 (g) 13,600 14,665 6.000% due 02/15/2026 (g) 7,700 8,076 5.500% due 08/15/2028 (g) 35,000 34,404 U.S. Treasury Notes 4.250% due 11/15/2003 (g) 21,250 20,719 U.S. Treasury Strips 0.000% due 05/15/2013 12,200 6,389 0.000% due 02/15/2019 26,600 9,524 0.000% due 05/15/2020 (g) 129,300 42,857 ------------- Total U.S. Treasury Obligations 290,626 (Cost $283,590) ------------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 56.7% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 29.1% Bank of America Mortgage Securities, Inc. 7.250% due 02/25/2031 2,000 1,999 Bear Stearns Mortgage Securities, Inc. 7.100% due 06/25/2024 385 382 7.512% due 06/25/2030 (d) 796 796 California Federal Bank 7.299% due 08/25/2030 (d) 576 580 Chase Mortgage Finance Corp. 8.493% due 04/25/2025 (d) 969 989 Countrywide Funding Corp. 6.500% due 01/25/2009 564 568 7.000% due 05/25/2024 8,000 7,791 Discover Card Master Trust I 6.792% due 04/16/2010 966 1,006 Fannie Mae 6.250% due 12/25/2013 82 81 5.650% due 10/25/2017 (d) 2,970 2,991 7.000% due 02/25/2020 1,523 1,539 6.950% due 07/25/2020 1,264 1,284 6.750% due 06/25/2021 2,633 109 8.000% due 03/25/2022 5 5 7.000% due 04/25/2022 910 910 7.000% due 06/25/2022 438 439 7.800% due 10/25/2022 407 425 7.000% due 10/25/2022 1,697 1,681 7.000% due 05/25/2023 69 69 6.900% due 05/25/2023 681 672 7.000% due 05/25/2023 1,368 1,410 7.000% due 06/25/2023 584 602 7.000% due 07/25/2023 58 58 6.500% due 08/25/2023 839 802 6.000% due 08/25/2023 145 132 4.500% due 10/25/2023 285 180 6.500% due 11/25/2023 2,000 1,953 6.500% due 12/25/2023 3,978 3,775 7.000% due 12/25/2023 1,659 1,671 6.500% due 01/25/2024 1,577 1,529 6.500% due 02/25/2024 317 302 6.000% due 05/17/2027 2,500 2,254 7.000% due 05/18/2027 1,657 1,631 First Boston Mortgage Securities Corp. 7.300% due 07/25/2023 1,531 1,526 Freddie Mac 9.500% due 01/15/2005 21 21 8.000% due 02/15/2015 443 462 6.000% due 01/15/2019 4,464 4,107 4.250% due 12/15/2021 441 433 7.000% due 07/15/2022 1,148 1,149 7.000% due 05/15/2023 280 281 7.000% due 08/15/2023 348 347 7.000% due 09/15/2023 844 856 6.250% due 09/15/2023 5,000 5,027 7.410% due 10/25/2023 1,319 1,342 6.500% due 11/15/2023 5,488 5,150 6.000% due 11/15/2023 1,008 967 6.500% due 11/25/2023 652 602 6.250% due 12/15/2023 523 493 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 117 Schedule of Investments (Cont.) Long-Term U.S. Government Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 6.500% due 12/15/2023 $ 1,085 $ 1,049 7.000% due 01/15/2024 104 107 7.500% due 01/20/2024 1,283 1,291 6.500% due 02/15/2024 203 185 6.500% due 03/15/2024 1,192 1,166 6.500% due 12/15/2024 2,212 2,225 7.500% due 02/15/2025 1,522 1,546 6.500% due 11/15/2027 1,205 1,053 6.500% due 01/15/2028 4,911 4,725 6.500% due 03/15/2029 272 234 6.000% due 05/15/2029 112 97 7.000% due 10/15/2030 9,000 9,208 General Electric Capital Mortgage Services, Inc. 9.000% due 10/25/2023 201 205 6.500% due 11/25/2023 3,000 2,915 6.500% due 01/25/2024 4,765 4,386 6.500% due 03/25/2024 934 927 7.000% due 10/25/2027 547 548 6.650% due 05/25/2028 4,561 4,599 German American Capital Corp. 7.000% due 08/12/2010 3,000 3,170 Government National Mortgage Association 7.000% due 03/16/2029 287 259 Independent National Mortgage Corp. 9.329% due 01/25/2025 (d) 37 38 6.930% due 05/25/2026 388 388 Mellon Residential Funding Corp. 6.460% due 07/25/2029 (d) 867 869 Merrill Lynch Mortgage Investors, Inc. 6.050% due 10/15/2008 2,428 2,438 6.210% due 03/20/2017 98 98 Norwest Asset Securities Corp. 6.750% due 07/25/2028 3,000 2,981 6.750% due 10/25/2028 973 971 PNC Mortgage Securities Corp. 7.500% due 01/25/2015 1,591 1,613 7.500% due 02/25/2027 1,754 1,816 6.750% due 04/25/2028 3,000 3,039 6.012% due 12/25/2030 (d) 6,986 6,999 Prudential Home Mortgage Securities 6.950% due 09/25/2023 73 68 6.500% due 11/25/2023 102 97 6.500% due 01/25/2024 1,460 1,355 8.000% due 06/25/2024 594 620 Residential Accredit Loans, Inc. 7.000% due 02/25/2028 2,000 2,037 Residential Funding Mortgage Securities I 8.766% due 03/25/2025 (d) 45 47 7.750% due 09/25/2026 1,100 1,124 7.500% due 04/25/2027 1,872 1,916 7.500% due 11/25/2030 4,101 4,085 Resolution Trust Corp. 7.441% due 05/25/2029 (d) 644 659 6.530% due 09/25/2029 1,005 1,007 Vendee Mortgage Trust 6.500% due 06/15/2024 2,323 2,252 ------------- 139,790 ------------- Fannie Mae 8.1% 6.500% due 05/01/2003-07/01/2005 (e) 6,108 6,203 6.626% due 12/01/2027 (d) 2,135 2,211 7.000% due 03/01/2004-03/01/2009 (e) 14,115 14,451 7.326% due 02/01/2028 (d) 380 393 7.383% due 01/01/2026 (d) 720 760 7.477% due 05/01/2025 (d) 1,372 1,437 7.500% due 02/01/2004-10/01/2004 (e) 3,163 3,230 7.970% due 10/01/2024 (d) 1,552 1,603 8.059% due 04/01/2028 (d) 2,242 2,304 8.246% due 08/01/2026 (d) 182 183 8.306% due 11/01/2023 (d) 2,384 2,430 8.444% due 08/01/2026 (d) 333 337 8.500% due 04/01/2028 1,404 1,489 9.000% due 08/01/2021-06/01/2027 (e) 1,484 1,572 9.094% due 10/01/2024 (d) 73 75 ------------- 38,678 ------------- Federal Housing Administration 5.7% 6.896% due 07/01/2020 3,395 3,267 7.000% due 11/25/2019 4,000 3,859 7.400% due 12/18/2018 1,536 1,528 7.421% due 11/01/2019 102 101 7.430% due 08/01/2019-06/01/2024 (e) 18,890 18,784 ------------- 27,539 ------------- Freddie Mac 4.0% 6.381% due 01/01/2028 (d) 2,402 2,464 6.742% due 09/01/2027 (d) 3,209 3,279 6.925% due 01/01/2028 (d) 1,528 1,565 7.000% due 07/01/2002 964 977 7.318% due 02/01/2028 (d) 1,782 1,854 7.450% due 03/25/2022 1,566 1,564 7.500% due 06/01/2004-10/01/2004 (e) 2,565 2,590 7.960% due 05/01/2022 (d) 94 97 8.000% due 05/01/2004 2,914 2,949 8.302% due 10/01/2026 (d) 769 786 8.349% due 06/01/2022 (d) 52 53 9.032% due 12/01/2024 (d) 1,052 1,089 ------------- 19,267 ------------- Government National Mortgage Association 8.9% 6.500% due 05/20/2030 (d) 14,691 14,842 6.800% due 10/15/2030 1,992 1,975 7.125% due 10/20/2026 (d) 55 56 7.375% due 02/20/2017-01/20/2028 (d)(e) 12,256 12,429 7.625% due 12/20/2017-11/20/2027 (d)(e) 7,160 7,341 7.750% due 09/20/2017-09/20/2026 (d)(e) 6,195 6,343 ------------- 42,986 ------------- Stripped Mortgage-Backed Securities 0.9% Fannie Mae (IO) 1187.600% due 08/25/2006 2 8 6.500% due 02/25/2007 44 2 6.500% due 07/25/2007 335 10 1197.960% due 08/25/2007 5 109 1014.600% due 09/25/2007 3 56 6.500% due 08/25/2020 120 7 6.500% due 09/25/2021 339 32 7.000% due 12/25/2021 134 15 Fannie Mae (PO) 0.000% due 03/25/2009 2,975 2,328 0.000% due 09/25/2023 1,538 1,158 Freddie Mac (IO) 7.000% due 03/15/2003 753 47 6.500% due 11/15/2003 1,364 108 7.000% due 02/15/2006 22 0 6.500% due 10/15/2006 86 4 819.100% due 02/15/2007 3 43 7.500% due 06/15/2007 239 16 6.500% due 10/15/2007 633 40 6.000% due 10/15/2007 62 4 6.500% due 11/15/2008 649 86 7.000% due 12/15/2023 1,318 167 Norwest Asset Securities Corp. (IO) 7.250% due 02/25/2012 820 79 ------------- 4,319 ------------- Total Mortgage-Backed Securities 272,579 (Cost $267,765) ------------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 5.5% -------------------------------------------------------------------------------- Chase Credit Card Master Trust 6.777% due 05/15/2007 859 865 Chase Manhattan Corp 6.750% due 08/25/2028 1,850 1,793 CS First Boston Mortgage Securities Corp. 5.423% due 12/15/2030 (d) 3,842 3,846 Green Tree Floorplan Receivables Master Trust 5.187% due 11/15/2004 (d) 3,000 3,001 HPSC Equipment Receivables LLC 5.307% due 11/22/2007 (d) 9,534 9,533 118 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Provident Bank Equipment Lease Trust 5.830% due 11/25/2011 (d) $ 4,330 $ 4,330 Residential Funding Mortgage Securities, Inc. 6.290% due 07/25/2013 502 501 SallieMae 6.464% due 07/25/2004 (d) 728 727 6.839% due 10/27/2025 (d) 1,963 1,939 ------------- Total Asset-Backed Securities 26,535 (Cost $26,522) ------------- -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 0.0% -------------------------------------------------------------------------------- U.S. Treasury Note June Futures (CBOT) Strike @ 107.00 Exp. 05/26/2001 15,000 44 Strike @ 112.00 Exp. 05/26/2001 50,000 8 Strike @ 110.00 Exp. 05/26/2001 15,000 33 ------------- Total Purchased Call Options 85 (Cost $104) ------------- -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- U.S. Treasury Bond June Futures (CBOT) Strike @ 93.00 Exp. 05/26/2001 100,000 16 U.S. Treasury Bond 9.250% due 02/15/2016 Strike @ 115.00 Exp. 05/01/2001 90,000 0 ------------- Total Purchased Put Options 16 (Cost $35) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 2.5% -------------------------------------------------------------------------------- Commercial Paper 1.5% Federal Home Loan Bank 4.675% due 09/07/2001 100 98 General Electric Capital Corp. 4.980% due 04/25/2001 2,500 2,492 National Rural Utilities Cooperative Finance Corp. 4.880% due 05/25/2001 4,500 4,468 ------------- 7,058 ------------- Repurchase Agreement 0.3% State Street Bank 4.600% due 04/02/2001 1,535 1,535 (Dated 03/30/2001. Collateralized ------------- by Freddie Mac 6.680% due 12/28/2001 valued at $1,569. Repurchase proceeds are $1,536.) U.S. Treasury Bills (b) 0.7% 3.450% due 05/17/2001 (e) 3,450 3,429 ------------- Total Short-Term Instruments 12,022 (Cost $12,022) ------------- Total Investments (a) 145.5% $ 699,912 (Cost $686,690) Written Options (c) (0.2%) (849) (Premiums $631) Other Assets and Liabilities (Net)(45.3%) (218,014) ------------- Net Assets 100.0% $ 481,049 ------------- -------------------------------------------------------------------------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $686,690 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 15,737 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (2,515) ------------- Unrealized appreciation-net $ 13,222 ------------- (b) Securities with an aggregate market value of $8,111 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 30 Year Bond (06/2001) 1,085 $ (2,000) U.S. Treasury 5 Year Note (06/2001) 634 56 Municipal Bond (06/2001) 8 4 ------------- $ (1,940) ------------- (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Call - CBOT U.S.Treasury Bond June Futures Strike @ 108.00 Exp. 05/26/2001 200 $167 $ 75 Put - CBOT U.S.Treasury Bond June Futures Strike @ 103.00 Exp. 05/26/2001 490 97 475 Call - CBOT 5 Year June Futures Strike @ 106.00 Exp. 05/26/2001 150 88 91 Call - CBOT U.S. Treasury Note June Futures Strike @ 110.00 Exp. 05/26/2001 10 4 2 Put - CBOT U.S.Treasury Note June Futures Strike @ 102.00 Exp. 05/26/2001 10 2 1 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 150 91 82 Call - CBOT U.S.Treasury Bond June Futures Strike @ 109.00 Exp. 05/26/2001 490 181 123 Call - CBOT U.S.Treasury Bond June Futures Strike @ 112.00 Exp. 05/26/2001 3 1 0 --------------------- $631 $ 849 --------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Securities are grouped by coupon or range of coupons and represent a range of maturities. (f) Principal amount of the security is adjusted for inflation. (g) Subject to financing transaction. (h) Security is in default. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 119 Schedule of Investments (Cont.) Long-Term U.S. Government Fund March 31, 2001 -------------------------------------------------------------------------------- (i) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR and pay a fixed rate equal to 6.826%. Broker: Morgan Stanley Exp. 10/26/2030 $ 4,110 $ (296) Receive floating rate based on 3-month LIBOR and pay a fixed rate equal to 6.778%. Broker: Goldman Sachs Exp. 02/15/2021 3,900 (258) Receive fixed rate equal to 0.230% and the Fund will pay to the counterparty at par in the event of default of Associates Corp. 6.000% due 04/15/2003. Broker: Warburg Dillon Read LLC Exp. 01/14/2003 3,000 0 ----------- $ (554) ----------- Fixed Unrealized Spread Notional Appreciation/ Type (%) Amount (Depreciation) -------------------------------------------------------------------------------- Receive On-The-Run 10-year Swap Spread and pay a fixed spread. The On-The-Run 10-year Swap Spread is the difference between the 10-year Swap Rate and the 10- year Treasury Rate. Broker: Bank of America Exp. 06/17/2002 1.3100 $ 53,750 $ (1,063) Receive a fixed spread and pay On-The-Run 10-year Swap Spread. The On-The-Run 10-year Swap Spread is the difference between the 10-year Swap Rate and the 10-year Treasury Rate. Broker: Bank of America Exp. 06/15/2001 1.0000 50,000 1,343 Receive the 10-year Swap Spread and pay a fixed spread. The 10-year Swap Spread is the difference between the 10-year Swap Rate and the 10-year Treasury Rate. Broker: Morgan Stanley Exp. 06/29/2015 1.3367 30,000 (508) Receive the 5-year Swap Spread and pay a fixed spread. The 5-year Swap Spread is the difference between the 5-year Swap Rate and the 5-year Treasury Rate. Broker: Goldman Sachs Exp. 05/15/2006 1.0500 10,000 77 ---------- $ (151) ---------- 120 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments Investment Grade Corporate Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 86.1% -------------------------------------------------------------------------------- Banking & Finance 8.9% Associates Corp. of North America 6.875% due 11/15/2008 $ 100 $ 104 CIT Group, Inc. 5.500% due 02/15/2004 100 99 J.P. Morgan & Co., Inc. 6.875% due 01/15/2007 100 104 PP&L Capital Funding, Inc. 7.750% due 04/15/2005 100 103 Wachovia Corp. 6.375% due 02/01/2009 100 99 ------------- 509 ------------- Industrials 51.7% American Airlines, Inc. 10.180% due 01/02/2013 150 165 AT&T Corp. 12.000% due 08/15/2007 100 111 Cliffs Drilling Co. 10.250% due 05/15/2003 100 103 Comcast Corp. 10.250% due 10/15/2001 28 29 Cox Communications, Inc. 7.000% due 08/15/2001 140 141 6.150% due 08/01/2003 100 101 6.875% due 06/15/2005 100 102 Delta Air Lines, Inc. 10.500% due 04/30/2016 200 228 Gulf Canada Resources Ltd. 8.350% due 08/01/2006 35 38 Harrahs Operating Co., Inc. 7.500% due 01/15/2009 100 100 HCA - The Healthcare Co. 8.160% due 09/19/2002 (d) 100 100 International Paper Co. 7.000% due 06/01/2001 100 100 MGM Grand, Inc. 6.950% due 02/01/2005 240 240 Mirage Resorts, Inc. 6.625% due 02/01/2005 100 99 Northwest Airlines, Inc. 8.520% due 04/07/2004 200 200 Park Place Entertainment Corp. 7.950% due 08/01/2003 215 221 RJ Reynolds Tobacco Holdings, Inc. 7.625% due 09/15/2003 100 100 Starwood Hotels & Resorts 6.750% due 11/15/2005 100 99 Tele-Communications, Inc. 8.250% due 01/15/2003 150 156 Turner Broadcasting System, Inc. 7.400% due 02/01/2004 115 120 United Air Lines, Inc. 10.125% due 03/22/2015 100 109 US Airways, Inc. 8.020% due 02/05/2019 100 109 Waste Management, Inc. 6.625% due 07/15/2002 100 100 7.700% due 10/01/2002 100 102 ------------- 2,973 ------------- Utilities 25.5% British Telecommunications PLC 7.722% due 12/15/2003 (d) 100 100 7.625% due 12/15/2005 100 104 CenturyTel, Inc. 7.750% due 10/15/2002 100 102 CMS Panhandle Holding Co. 6.125% due 03/15/2004 100 99 Deutsche Telekom 8.000% due 06/15/2010 100 102 Dominion Resources, Inc. 8.125% due 06/15/2010 100 111 Florida Power & Light 6.875% due 12/01/2005 100 105 France Telecom 7.750% due 03/01/2011 100 101 Niagara Mohawk Power Co. 7.750% due 05/15/2006 100 106 Progress Energy, Inc. 6.550% due 03/01/2004 100 102 Texas Utilities Corp. 5.940% due 10/15/2001 (d) 125 126 Vodafone Group PLC 7.750% due 02/15/2010 100 108 WorldCom, Inc. 7.375% due 01/15/2003 (d) 100 101 7.550% due 04/01/2004 100 102 ------------- 1,469 ------------- Total Corporate Bonds & Notes 4,951 (Cost $4,747) ------------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 3.9% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (c) 3.625% due 07/15/2002 (b) 219 223 ------------- Total U.S. Treasury Obligations 223 (Cost $218) ------------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 2.5% -------------------------------------------------------------------------------- Conseco Finance Securitizations Corp. 8.850% due 12/01/2031 130 146 ------------- Total Asset-Backed Securities 146 (Cost $130) ------------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 1.9% -------------------------------------------------------------------------------- United Mexican States 9.750% due 04/06/2005 100 107 ------------- Total Sovereign Issues 107 (Cost $103) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 4.3% -------------------------------------------------------------------------------- Repurchase Agreement 4.3% State Street Bank 4.600% due 04/02/2001 249 249 (Dated 03/30/2001. Collateralized by Federal Home Loan Bank 5.350% due 12/15/2003 valued at $259. Repurchase proceeds are $249.) ------------- Total Short Term Instruments 249 (Cost $249) ------------- Total Investments (a) 98.7% $ 5,676 (Cost $5,447) Other Assets and Liabilities (Net) 1.3% 75 ------------- Net Assets 100.0% $ 5,751 ------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $5,447 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 232 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (3) ------------- Unrealized appreciation-net $ 229 ------------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 121 Schedule of Investments (Cont.) Investment Grade Corporate Bond Fund March 31, 2001 -------------------------------------------------------------------------------- (b) Securities with an aggregate market value of $223 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 30 Year Bond (06/2001) 12 $ (1) Eurodollar September Futures (09/2002) 3 (1) -------------- $ (2) -------------- (c) Principal amount of the security is adjusted for inflation. (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy EC 240 04/2001 $ (13) Sell 240 04/2001 1 Buy 240 06/2001 (1) -------------- $ (13) -------------- (f) Principal amount denoted in indicated currency: BP - British Pound EC - Euro (g) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount Appreciation -------------------------------------------------------------------------------- Receive fixed rate equal to 5.626% and pay floating rate based on 6-month BP-LIBOR Broker: Morgan Stanley Exp. 02/02/2004 BP 100 $ 0 Receive floating rate based on 6-month BP-LIBOR and Pay fixed rate equal to 5.200% Broker: Goldman Sachs Exp. 06/16/2002 200 0 Receive fixed rate equal to 5.260% and pay floating rate based on 6-month BP-LIBOR Broker: Goldman Sachs Exp. 03/16/2004 200 0 -------------- $ 0 -------------- 122 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments High Yield Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 73.6% -------------------------------------------------------------------------------- Banking & Finance 4.5% Americo Life, Inc. 9.250% due 06/01/2005 $ 198 $ 193 Amethyst Financial Co. Ltd. 11.750% due 10/29/2001 3,944 3,944 Arvin Capital 9.500% due 02/01/2027 14,986 10,866 Bay View Capital Corp. 9.125% due 08/15/2007 2,900 2,277 Beaver Valley Funding Corp. 8.625% due 06/01/2007 14,197 14,946 9.000% due 06/01/2017 9,432 10,239 Choctaw Resort Development Enterprise 9.250% due 04/01/2009 1,400 1,430 Forest City Enterprises, Inc. 8.500% due 03/15/2008 10,719 10,357 General Motors Acceptance Corp. 5.722% due 04/29/2002 (d) 631 632 Golden State Holdings 6.750% due 08/01/2001 (d) 8,180 8,162 7.000% due 08/01/2003 3,073 3,048 7.125% due 08/01/2005 687 673 Host Marriott LP 8.375% due 02/15/2006 9,197 9,151 Lamar Media Corp. 9.625% due 12/01/2006 100 105 Presidential Life Insurance Corp. 7.875% due 02/15/2009 7,451 7,233 Reliance Group Holdings, Inc. 0.000% due 11/15/2049 (c)(e) 3,769 330 Sumitomo Bank Treasury Co. 9.400% due 12/29/2049 (d) 10,459 10,087 Telewest Credit Links 10.875% due 02/07/2005 14,000 11,839 Trizec Finance Ltd. 10.875% due 10/15/2005 13,772 14,047 ------------- 119,559 ------------- Industrials 59.7% 360 Networks, Inc. 13.000% due 05/01/2008 5,740 2,210 Abbey Healthcare Group 9.500% due 11/01/2002 11,346 11,431 Adelphia Business Solutions, Inc. 12.250% due 09/01/2004 5,679 5,310 Adelphia Communications Corp. 10.875% due 10/01/2010 15 16 Allied Waste North America, Inc. 7.375% due 01/01/2004 13,910 13,701 7.625% due 01/01/2006 7,438 7,252 8.875% due 04/01/2008 8,000 7,928 American Airlines, Inc. 10.610% due 03/04/2010 513 580 American Cellular Corp. 9.500% due 10/15/2009 6,000 5,820 American Media Operation, Inc. 10.250% due 05/01/2009 789 809 American Standard Cos., Inc. 7.125% due 02/15/2003 158 160 9.250% due 12/01/2016 1,177 1,183 Amerigas Partners LP 10.000% due 04/15/2006 4,900 4,895 10.125% due 04/15/2007 2,367 2,450 AM-FM, Inc. 8.750% due 06/15/2007 4,457 4,691 8.000% due 11/01/2008 4,144 4,320 Amphenol Corp. 9.875% due 05/15/2007 5,445 5,731 Archibald Candy Corp. 10.250% due 07/01/2004 3,155 1,672 Arco Chemical Co. 9.375% due 12/15/2005 4,425 4,561 Ball Corp. 7.750% due 08/01/2006 6,704 6,830 8.250% due 08/01/2008 5,206 5,323 Beckman Instruments, Inc. 7.100% due 03/04/2003 6,423 6,471 7.450% due 03/04/2008 12,717 12,559 Benedek Communications Corp. 0.000% due 05/15/2006 (c) 1,184 787 Bergen Brunswig Corp. 7.375% due 01/15/2003 6,950 6,912 7.250% due 06/01/2005 500 486 Beverly Enterprises, Inc. 9.000% due 02/15/2006 13,070 13,266 British Sky Broadcasting PLC 7.300% due 10/15/2006 6,733 6,616 6.875% due 02/23/2009 10,000 9,268 8.200% due 07/15/2009 21,299 21,296 Browning-Ferris Industries, Inc. 6.100% due 01/15/2003 3,234 3,150 7.875% due 03/15/2005 1,578 1,575 Building Materials Corp. 7.750% due 07/15/2005 971 553 8.000% due 10/15/2007 1,007 539 8.000% due 12/01/2008 10,601 5,672 Cadmus Communications Corp. 9.750% due 06/01/2009 2,250 2,109 Call-Net Enterprises, Inc. 8.000% due 08/15/2008 6,765 2,089 Canadian Forest Oil Ltd. 8.750% due 09/15/2007 11,372 11,656 Century Aluminum Co. 11.750% due 04/15/2008 6,050 6,171 Century Communications Corp. 9.750% due 02/15/2002 513 517 0.010% due 03/15/2003 15,743 12,752 9.500% due 03/01/2005 10,500 10,487 8.750% due 10/01/2007 2,998 2,893 CF Cable TV, Inc. 9.125% due 07/15/2007 9,149 9,319 Charter Communications Holdings LLC 8.250% due 04/01/2007 10,845 10,425 8.625% due 04/01/2009 3,944 3,816 10.000% due 04/01/2009 8,172 8,519 11.750% due 01/15/2010 35 24 9.920% due 04/01/2011 8,000 5,620 Clark R & M, Inc. 8.375% due 11/15/2007 2,392 1,854 Clearnet Communications, Inc. 0.000% due 05/01/2009 (c) 4,733 3,999 Cliffs Drilling Co. 10.250% due 05/15/2003 592 612 Columbus McKinnon 8.500% due 04/01/2008 8,306 7,019 Consolidated Container 10.125% due 07/15/2009 6,428 6,332 Constellation Brands, Inc. 8.000% due 02/15/2008 6,000 6,165 8.500% due 03/01/2009 4,000 4,040 Container Corp. of America 9.750% due 04/01/2003 789 807 11.250% due 05/01/2004 5,185 5,211 Continental Cablevision 9.500% due 08/01/2013 7,900 8,757 Cross Timbers Oil Co. 9.250% due 04/01/2007 1,136 1,198 8.750% due 11/01/2009 1,900 1,986 Crown Castle International Corp. 0.000% due 11/15/2007 1,775 1,473 10.750% due 08/01/2011 12,755 13,233 CSC Holdings, Inc. 9.250% due 11/01/2005 789 825 9.875% due 05/15/2006 671 704 7.875% due 12/15/2007 79 80 7.625% due 04/01/2011 9,150 8,978 9.875% due 02/15/2013 2,595 2,790 9.875% due 04/01/2023 3,155 3,407 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 123 Schedule of Investments (Cont.) High Yield Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Cumberland Farms 10.500% due 10/01/2003 $ 4,528 $ 4,415 Delta Air Lines, Inc. 10.790% due 03/26/2014 1,786 1,988 Diamond Cable Communication Co. 13.250% due 09/30/2004 1,184 1,160 11.750% due 12/15/2005 (d) 7,887 7,335 0.000% due 02/15/2007 (c) 2,700 1,944 Echostar Communications Corp. 9.250% due 02/01/2006 19,177 19,248 9.375% due 02/01/2009 6,704 6,754 Electric Lightwave, Inc. 6.050% due 05/15/2004 1,000 914 Energis PLC 9.750% due 06/15/2009 3,550 3,355 Fairpoint Communications, Inc. 9.500% due 05/01/2008 6,412 5,354 10.908% due 05/01/2008 (d) 3,550 3,345 Federal-Mogul Corp. 7.500% due 07/01/2004 5,719 886 7.375% due 01/15/2006 119 17 7.750% due 07/01/2006 7,473 1,084 Ferrellgas Partners LP 9.375% due 06/15/2006 11,931 11,573 Fisher Scientific International 7.125% due 12/15/2005 10,845 10,357 9.000% due 02/01/2008 12,249 12,280 Flag Ltd. 8.250% due 01/30/2008 22,141 20,147 Forest Oil Corp. 10.500% due 01/15/2006 2,828 2,984 Fox/Liberty Networks LLC 0.000% due 08/15/2007 (c) 7,690 7,036 Garden State Newspapers 8.750% due 10/01/2009 3,120 3,042 8.625% due 07/01/2011 3,076 2,999 Global Crossing Holding Ltd. 9.500% due 11/15/2009 3,944 3,717 6.000% due 10/15/2013 9,969 9,450 Golden Northwest Aluminum 12.000% due 12/15/2006 1,933 1,653 Gulf Canada Resources Ltd. 9.625% due 07/01/2005 2,233 2,311 8.375% due 11/15/2005 3,155 3,423 Harrahs Operating Co., Inc. 7.875% due 12/15/2005 10,206 10,257 7.500% due 01/15/2009 16,307 16,275 HCA - The Healthcare Co. 6.870% due 09/15/2003 1,026 1,035 6.910% due 06/15/2005 986 971 8.850% due 01/01/2007 5,350 5,791 7.000% due 07/01/2007 14,993 14,562 8.700% due 02/10/2010 450 476 8.360% due 04/15/2024 4,733 4,586 6.730% due 07/15/2045 3,944 3,985 Hercules, Inc. 11.125% due 11/15/2007 7,454 7,566 HMH Properties, Inc. 7.875% due 08/01/2005 28,334 27,554 Hollinger International Publishing 8.625% due 03/15/2005 198 201 9.250% due 02/01/2006 3,629 3,738 9.250% due 03/15/2007 537 556 Horseshoe Gaming Holding 8.625% due 05/15/2009 15,250 15,212 HS Resources, Inc. 9.875% due 12/01/2003 2,879 2,937 9.250% due 11/15/2006 12,365 12,860 Huntsman Corp. 9.500% due 07/01/2007 9,718 7,532 Huntsman ICI Chemicals LLC 10.125% due 07/01/2009 1,796 1,859 Huntsman Polymers Corp. 11.750% due 12/01/2004 3,629 3,030 Intermedia Communications, Inc. 0.000% due 05/15/2006 (c) 20,240 20,442 International Game Technology 7.875% due 05/15/2004 11,594 11,768 8.375% due 05/15/2009 11,121 11,455 ISP Holdings, Inc. 9.000% due 10/15/2003 16,374 14,245 John Q. Hammons Hotels 8.875% due 02/15/2004 2,312 2,231 9.750% due 10/01/2005 2,633 2,541 Jones Intercable, Inc. 8.875% due 04/01/2007 3,991 4,284 Jupiters Ltd. 8.500% due 03/01/2006 10,096 10,071 K Mart Corp. 12.350% due 01/01/2008 3,803 4,111 8.800% due 07/01/2010 902 818 9.350% due 01/02/2020 10,203 7,974 9.780% due 01/05/2020 7,552 6,432 Keebler Corp. 10.750% due 07/01/2006 4,733 5,020 KPNQWest BV 8.125% due 06/01/2009 19,560 17,115 L-3 Communications Corp. 10.375% due 05/01/2007 5,938 6,116 8.500% due 05/15/2008 466 472 Lear Corp. 8.250% due 02/01/2002 5,056 5,081 7.960% due 05/15/2005 4,315 4,352 Lenfest Communications 8.375% due 11/01/2005 8,400 9,156 10.500% due 06/15/2006 415 489 Level 3 Communications, Inc. 11.000% due 03/15/2008 4,338 3,416 9.125% due 05/01/2008 27,655 19,773 0.000% due 12/01/2008 (c) 9,425 4,571 11.250% due 03/15/2010 789 619 12.875% due 03/15/2010 18,000 6,930 Levi Strauss & Co. 6.800% due 11/01/2003 15,853 14,902 Leviathan Gas Corp. 10.375% due 06/01/2009 2,773 2,981 Lin Television Corp. 8.375% due 03/01/2008 10,035 9,082 Lyondell Chemical Co. 9.625% due 05/01/2007 12,174 12,539 Mail-Well Corp. 8.750% due 12/15/2008 8,026 6,862 Mandalay Resort Group 6.750% due 07/15/2003 16,077 15,554 9.250% due 12/01/2005 4,812 4,854 6.450% due 02/01/2006 79 74 10.250% due 08/01/2007 198 204 9.500% due 08/01/2008 395 413 Manor Care, Inc. 8.000% due 03/01/2008 3,000 3,068 Marsh Supermarkets, Inc. 8.875% due 08/01/2007 5,916 5,724 McLeodUSA, Inc. 0.000% due 03/01/2007 (c) 34,329 28,321 8.375% due 03/15/2008 4,023 3,430 9.500% due 11/01/2008 14,997 13,535 8.125% due 02/15/2009 3,815 3,205 11.500% due 05/01/2009 789 773 Mediacom LLC 9.500% due 01/15/2013 22,600 22,205 Metromedia Fiber Network, Inc. 10.000% due 11/15/2008 18,301 15,281 10.000% due 12/15/2009 11,910 9,945 MGM Grand, Inc. 6.950% due 02/01/2005 23,993 23,977 8.500% due 09/15/2010 15,000 15,680 124 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Mirage Resorts, Inc. 6.625% due 02/01/2005 $ 2,761 $ 2,733 7.250% due 10/15/2006 2,106 2,111 Newpark Resources, Inc. 8.625% due 12/15/2007 3,470 3,435 Nextel Communications, Inc. 0.000% due 09/15/2007 (c) 9,000 6,683 9.375% due 11/15/2009 20,333 17,334 Nextel Partners, Inc. 0.000% due 02/01/2009 (c) 14,701 9,151 11.000% due 03/15/2010 2,658 2,319 Nextlink Communications, Inc. 9.625% due 10/01/2007 7,099 4,224 10.750% due 06/01/2009 8,426 5,013 10.500% due 12/01/2009 8,037 4,943 NL Industries, Inc. 11.750% due 10/15/2003 1,135 1,158 NTL, Inc. 12.750% due 04/15/2005 553 528 11.500% due 02/01/2006 2,600 2,327 11.500% due 10/01/2008 5,026 4,448 Octel Developments PLC 10.000% due 05/01/2006 1,499 1,506 Omnicare, Inc. 5.000% due 12/01/2007 6,000 5,258 8.125% due 03/15/2011 6,000 6,150 Orion Network Systems, Inc. 0.000% due 01/15/2007 (c) 9,885 2,669 11.250% due 01/15/2007 11,535 4,268 P&L Coal Holdings 8.875% due 05/15/2008 15,025 15,739 Park Place Entertainment Corp. 8.875% due 09/15/2008 4,733 4,839 Petroleos Mexicanos 9.375% due 12/02/2008 6,310 6,578 PharMerica, Inc. 8.375% due 04/01/2008 14,607 13,950 Physician Sales and Service, Inc. 8.500% due 10/01/2007 3,696 3,049 Piedmont Aviation, Inc. 10.200% due 01/15/2005 1,163 1,187 10.250% due 03/28/2005 451 446 9.900% due 11/08/2006 865 841 Pioneer National Resources Co. 8.875% due 04/15/2005 15,853 16,755 8.250% due 08/15/2007 6,827 7,000 6.500% due 01/15/2008 5,482 5,086 Price Communications Wireless, Inc. 9.125% due 12/15/2006 7,947 8,205 Pride International, Inc. 9.375% due 05/01/2007 4,595 4,865 Primedia, Inc. 10.250% due 06/01/2004 3,155 3,234 8.500% due 02/01/2006 8,671 8,801 7.625% due 04/01/2008 6,507 6,279 Qwest Communications International, Inc. 7.500% due 11/01/2008 5,916 6,138 R & B Falcon Corp. 6.500% due 04/15/2003 6,144 6,196 9.125% due 12/15/2003 1,250 1,306 6.750% due 04/15/2005 3,569 3,645 9.125% due 12/15/2008 722 784 R.H. Donnelley, Inc. 9.125% due 06/01/2008 5,455 5,591 Racers 8.375% due 10/01/2007 17,242 14,021 Renaissance Media Group 0.000% due 04/15/2008 (c) 16,960 12,974 Rogers Cablesystems Ltd. 10.000% due 03/15/2005 3,155 3,392 Rogers Cantel, Inc. 8.300% due 10/01/2007 3,524 3,498 8.800% due 10/01/2007 1,065 1,068 9.375% due 06/01/2008 27,024 28,173 Rural Cellular Corp. 9.625% due 05/15/2008 11,502 10,582 Safety-Kleen Corp. 9.250% due 06/01/2008 (e) 22,459 281 9.250% due 05/15/2009 (e) 11,042 138 SC International Services, Inc. 9.250% due 09/01/2007 11,970 12,389 Scotia Pacific Co. LLC 7.710% due 01/20/2014 (d) 142 104 Silgan Holdings, Inc. 9.000% due 06/01/2009 11,556 11,556 Smith's Food & Drug Centers, Inc. 8.640% due 07/02/2012 222 239 Station Casinos, Inc. 10.125% due 03/15/2006 782 812 9.750% due 04/15/2007 5,403 5,565 8.875% due 12/01/2008 631 639 9.875% due 07/01/2010 789 793 Stone Container Corp. 8.812% due 10/01/2005 1,117 1,121 11.500% due 08/15/2006 3,826 3,998 Telecorp PCS, Inc. 10.625% due 07/15/2010 10,888 10,561 Telewest Communications PLC 9.625% due 10/01/2006 3,873 3,757 11.000% due 10/01/2007 (d) 5,136 5,059 11.250% due 11/01/2008 789 797 0.000% due 04/15/2009 (c) 6,746 3,997 9.875% due 02/01/2010 6,113 5,777 Tenet Healthcare Corp. 7.875% due 01/15/2003 789 806 8.625% due 12/01/2003 5,684 5,905 8.000% due 01/15/2005 5,731 5,910 8.625% due 01/15/2007 5,761 6,006 7.625% due 06/01/2008 18,945 19,158 8.125% due 12/01/2008 10,500 10,841 Time Warner Telecom, Inc. 10.125% due 02/01/2011 5,650 5,678 Triad Hospitals, Inc. 11.000% due 05/15/2009 1,653 1,827 Tritel PCS, Inc. 10.375% due 01/15/2011 13,250 12,753 U.S. Airways, Inc. 9.625% due 09/01/2003 17,648 17,805 9.330% due 01/01/2006 3,280 3,198 United Defense Industries, Inc. 8.750% due 11/15/2007 789 783 United Pan-Europe Communications NV 0.000% due 02/01/2009 (c) 6,502 2,406 10.875% due 08/01/2009 5,885 3,972 1.000% due 11/01/2009 7,000 2,485 13.750% due 02/01/2010 6,500 2,178 Vintage Petroleum, Inc. 9.000% due 12/15/2005 7,761 8,033 9.750% due 06/30/2009 2,009 2,200 VoiceStream Wireless Corp. 10.375% due 11/15/2009 3,155 3,471 Waste Management, Inc. 7.000% due 05/15/2005 513 520 WCG Corp. 8.250% due 03/15/2004 11,900 11,850 Western Gas Resources, Inc. 10.000% due 06/15/2009 5,700 6,071 Williams Communications Group, Inc. 10.700% due 10/01/2007 7,493 5,845 11.700% due 08/01/2008 2,000 1,570 10.875% due 10/01/2009 7,492 5,507 11.875% due 08/01/2010 6,000 4,650 World Color Press, Inc. 8.375% due 11/15/2008 513 526 7.750% due 02/15/2009 1,381 1,373 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 125 Schedule of Investments (Cont.) High Yield Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Worldwide Fiber, Inc. 12.000% due 08/01/2009 $ 5,969 $ 2,238 XO Communications, Inc. 12.250% due 06/01/2009 3,800 1,349 12.125% due 12/01/2009 5,000 1,575 Young Broadcasting, Inc. 9.000% due 01/15/2006 14,690 13,919 8.750% due 06/15/2007 127 117 10.000% due 03/01/2011 13,400 13,065 ------------- 1,577,388 ------------- Utilities 9.4% AES Corp. 8.750% due 12/15/2002 3,000 3,060 10.250% due 07/15/2006 2,299 2,397 8.500% due 11/01/2007 6,152 6,106 9.500% due 06/01/2009 16,944 17,961 9.375% due 09/15/2010 15 16 American Tower Corp. 9.375% due 02/01/2009 13,000 12,513 AT&T Canada, Inc. 0.000% due 06/15/2008 (c) 28,344 23,592 10.625% due 11/01/2008 7,572 8,403 AT&T Wireless Services, Inc. 7.875% due 03/01/2011 16,750 16,732 Azurix Corp. 10.375% due 02/15/2007 9,644 9,933 Calpine Corp. 9.250% due 02/01/2004 10,254 10,259 7.625% due 04/15/2006 3,550 3,568 8.750% due 07/15/2007 19,241 19,774 7.875% due 04/01/2008 5,748 5,756 7.750% due 04/15/2009 789 780 8.500% due 02/15/2011 6,700 6,893 Carolina Power & Light Energy, Inc. 6.117% due 07/29/2002 (d) 2,288 2,293 Chesapeake Energy Corp. 9.625% due 05/01/2005 3,000 3,285 CMS Energy Corp. 8.125% due 05/15/2002 3,579 3,625 6.750% due 01/15/2004 592 578 7.000% due 01/15/2005 7,887 7,565 9.875% due 10/15/2007 6,113 6,548 8.500% due 04/15/2011 9,000 8,756 France Telecom 7.750% due 03/01/2011 19,750 19,902 Giant Industries, Inc. 9.750% due 11/15/2003 150 149 9.000% due 09/01/2007 1,750 1,654 Key Energy Services, Inc. 8.375% due 03/01/2008 2,770 2,853 Mastec, Inc. 7.750% due 02/01/2008 7,250 6,978 Progress Energy, Inc. 6.550% due 03/01/2004 9,070 9,266 7.100% due 03/01/2011 9,070 9,348 Rocky River Realty 8.810% due 04/14/2007 (b) 2,912 3,085 Williams Cos., Inc. 7.259% due 11/15/2001 (d) 4,812 4,819 Wilmington Trust Co. - Tucson Electric 10.210% due 01/01/2009 500 531 10.732% due 01/01/2013 7,015 7,840 ------------- 246,818 ------------- Total Corporate Bonds & Notes 1,943,765 (Cost $2,093,227) ------------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 1.7% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 1.7% LTC Commercial Corp. 9.200% due 08/04/2023 2,235 2,421 7.970% due 04/15/2028 3,993 3,750 NationsBanc Mortgage Capital Corp. 8.035% due 05/25/2028 3,035 2,664 Red Mountain Funding Corp. 9.150% due 11/28/2027 4,517 3,075 Resolution Trust Corp. 6.900% due 02/25/2027 3,693 3,591 7.000% due 05/25/2027 4,417 4,412 Sasco Floating Rate Commercial Mortgage Trust 5.600% due 04/25/2003 (d) 23,504 23,379 ------------- 43,292 ------------- Stripped Mortgage-Backed Securities 0.0% Fannie Mae (IO) 7.000% due 07/25/2008 1,366 163 6.500% due 06/25/2017 32 0 7.000% due 04/25/2019 5,965 243 7.000% due 12/25/2021 2,107 230 636 ------------- Total Mortgage-Backed Securities 43,928 (Cost $43,762) ------------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 10.1% -------------------------------------------------------------------------------- Acterna LLC 9.688% due 09/01/2007 1,476 1,466 Adelphia Communications Corp. 9.190% due 10/01/2002 3,000 3,000 9.300% due 02/15/2004 7,000 6,999 Airplanes Pass Through Trust 10.875% due 03/15/2019 22,490 14,828 Airtrust 0.990% due 06/01/2013 8,912 3,347 Allied Waste Industries, Inc. 7.687% due 07/30/2006 1,824 1,807 7.812% due 07/30/2006 8,056 7,982 8.062% due 07/21/2007 912 904 8.125% due 07/30/2007 (d) 2,280 2,259 9.625% due 07/30/2007 (d) 3,191 3,163 9.687% due 07/30/2007 (d) 4,559 4,518 9.812% due 07/30/2007 (d) 2 2 Allied Waste North America, Inc. 7.937% due 07/30/2007 912 911 Bergen Brunswig Corp. 7.650% due 03/31/2005 3,397 3,386 7.912% due 03/31/2005 394 393 8.133% due 03/31/2005 849 847 8.207% due 03/31/2005 1,699 1,693 9.120% due 03/31/2005 4,246 4,233 9.200% due 03/31/2005 4,246 4,233 9.331% due 03/31/2005 4,246 4,233 7.650% due 03/31/2006 2,548 2,561 Charter Commercial Holdings LLC 8.150% due 03/31/2008 15,500 15,382 Conseco Finance 9.300% due 10/15/2030 8,000 8,464 Continental Airlines, Inc. 6.792% due 07/30/2004 10,000 9,788 Crown Castle 8.130% due 03/31/2008 3,000 3,013 Da Vita 8.000% due 03/31/2003 4,176 4,169 8.750% due 03/13/2006 492 491 9.187% due 03/31/2006 2,463 2,458 Emmis Communications Corp. 8.312% due 08/31/2009 16,500 16,500 Flag Ltd. 7.312% due 03/31/2006 2,323 2,318 Global Crossing Holding Ltd. 8.030% due 08/15/2006 3,000 3,004 Green Tree Financial Corp. 8.000% due 07/15/2018 6,000 5,297 126 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Huntsman Corp. 9.571% due 07/31/2004 $ 787 $ 754 7.750% due 06/30/2005 492 447 8.913% due 06/30/2005 688 626 9.375% due 06/30/2005 1,869 1,700 9.500% due 06/30/2005 138 125 9.571% due 06/30/2005 1,351 1,229 8.750% due 12/31/2005 3,000 2,876 Impress Metal 9.457% due 12/01/2006 1,015 1,016 Insight Midwest 8.187% due 12/15/2009 7,000 7,043 Ispat Inland Co. 9.508% due 07/09/2003 4,000 3,100 Morgan Stanley Aircraft Finance 8.700% due 03/15/2023 17,782 11,878 Nextel Communications, Inc. 8.400% due 03/31/2008 17,169 16,722 Primedia, Inc. 7.955% due 07/31/2004 4,975 4,968 Rural Cellular Corp. 9.068% due 10/03/2009 3,819 3,752 Starwood Hotels & Resorts 7.757% due 02/23/2003 7,758 7,786 8.131% due 02/23/2003 6,743 6,767 Stone Container Corp. 8.812% due 04/01/2003 (d) 1,466 1,471 8.875% due 10/01/2003 1,466 1,471 8.812% due 10/01/2003 (d) 4,136 4,148 8.875% due 10/01/2003 4,129 4,142 8.812% due 10/01/2005 1,117 1,119 Total Renal Care 8.062% due 03/31/2003 878 872 8.437% due 03/31/2003 4,095 4,088 9.875% due 03/31/2003 7,324 7,274 Triad Hospitals, Inc. 9.240% due 12/31/2005 1,324 1,330 9.390% due 12/31/2005 5,523 5,547 VoiceStream 8.500% due 02/15/2009 4,500 4,466 8.190% due 06/30/2009 16,000 15,887 ------------- Total Asset-Backed Securities 266,253 (Cost $281,973) ------------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 0.2% -------------------------------------------------------------------------------- United Mexican States 8.500% due 02/01/2006 5,719 5,848 ------------- Total Sovereign Issues 5,848 (Cost $5,703) ------------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 1.9% -------------------------------------------------------------------------------- Health Care 0.7% Tenet Healthcare Corp. 6.000% due 12/01/2005 3,664 3,316 Total Renal Care Holdings 7.000% due 05/15/2009 15,953 13,959 ------------- 17,275 ------------- Industrial 1.0% Pride International, Inc. 0.010% due 04/24/2018 9,268 4,147 Waste Management, Inc. 4.000% due 02/01/2002 24,338 23,607 ------------- 27,754 ------------- Utilities 0.2% Nextel Communications, Inc. 5.250% due 01/15/2010 2,000 1,293 Rogers Communications, Inc. 2.000% due 11/26/2005 4,400 3,286 ------------- 4,579 ------------- Total Convertible Bonds & Notes 49,608 (Cost $48,033) ------------- Value Shares (000s) -------------------------------------------------------------------------------- PREFERRED STOCK 3.1% -------------------------------------------------------------------------------- CSC Holdings, Inc. 11.125% due 04/01/2008 161,572 $ 17,611 Fresenius Medical Care 9.000% due 12/01/2006 28,250 28,674 7.875% due 02/01/2008 26,750 26,015 Newscorp Overseas Ltd. 8.625% due 12/31/2049 105,100 2,512 Primedia, Inc. 9.200% due 11/01/2009 55,300 4,797 8.625% due 04/01/2010 39,500 3,308 ------------- Total Preferred Stock 82,917 (Cost $85,373) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 6.0% -------------------------------------------------------------------------------- Principal Amount (000s) Commercial Paper 5.7% Abbey National North America 5.425% due 04/19/2001 $ 400 399 American Express Credit Corp. 6.240% due 04/06/2001 500 500 CBA (de) Finance 4.960% due 04/23/2001 2,300 2,293 Coca-Cola Co. 5.140% due 04/12/2001 2,000 1,997 4.600% due 07/12/2001 4,000 3,944 Fannie Mae 4.685% due 09/06/2001 4,600 4,505 General Electric Capital Corp. 5.120% due 04/04/2001 1,700 1,700 4.600% due 07/18/2001 3,000 2,956 Gillette Co. 5.430% due 04/17/2001 1,500 1,497 4.910% due 08/21/2001 6,000 5,887 KFW International Finance, Inc. 5.320% due 05/30/2001 4,000 3,966 Monsanto Co. 4.980% due 08/15/2001 15,200 14,925 National Rural Utilities Cooperative Finance Corp. 5.300% due 05/24/2001 3,200 3,176 Reseau Ferre De France 4.590% due 07/25/2001 1,000 984 Swedbank, Inc. 5.290% due 05/30/2001 1,800 1,785 5.020% due 08/08/2001 3,400 3,341 UBS Finance, Inc. 5.400% due 04/02/2001 19,000 19,000 5.060% due 04/04/2001 4,500 4,499 5.390% due 05/30/2001 4,000 3,965 5.290% due 06/06/2001 4,900 4,855 5.920% due 06/06/2001 12,700 12,584 5.190% due 06/13/2001 8,600 8,514 5.290% due 06/13/2001 18,000 17,819 5.010% due 08/01/2001 20,500 20,164 5.040% due 08/02/2001 2,000 1,967 5.010% due 08/08/2001 3,500 3,440 ------------- 150,662 ------------- Repurchase Agreement 0.3% State Street Bank 4.600% due 04/02/2001 8,039 8,039 (Dated 03/30/2001. Collateralized by Freddie Mac 7.000% due 03/15/2010 valued at $8,205. Repurchase proceeds are $8,042.) ------------- Total Short-Term Instruments 158,700 (Cost $158,649) ------------- Total Investments (a) 96.6% $ 2,551,020 (Cost $2,716,720) Other Assets and Liabilities (Net) 3.4% 91,122 ------------- Net Assets 100.0% $ 2,642,142 ------------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 127 Schedule of Investments (Cont.) High Yield Fund March 31, 2001 -------------------------------------------------------------------------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $2,721,008 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 31,646 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (201,634) ----------- Unrealized depreciation-net $ (169,988) ----------- (b) Restricted security. (c) Security becomes interest bearing at a future date. (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Security is in default. (f) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) ---------------------------------------------------------------- Buy C$ 2,539 05/2001 $ (10) Sell 2,539 05/2001 4 Buy EC 2,870 04/2001 (9) Sell 2,870 04/2001 152 Sell 2,870 06/2001 9 ------------ $ 146 ------------ (g) Principal amount denoted in indicated currency: C$ - Canadian Dollar EC - Euro (h) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount Appreciation -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 2.500% and the Fund will pay to the counterparty at par in the event of default of CMS Energy Corp. Bond with maximum maturity date of 12/01/2009. Broker: Morgan Stanley Exp. 06/26/2001 $ 13,750 $ 38 ----------- 128 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments Total Return Mortgage Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.2% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (b) 3.625% due 07/15/2002 $ 55 $ 55 ------------- Total U.S. Treasury Obligations 55 (Cost $55) ------------- MORTGAGE-BACKED SECURITIES 123.7% Collateralized Mortgage Obligations 48.6% Chase Mortgage Finance Corp. 7.000% due 07/25/2024 477 477 6.550% due 08/25/2028 576 580 6.250% due 12/25/2028 334 304 Citicorp Mortgage Securities, Inc. 6.500% due 05/25/2030 295 293 Countrywide Alternative Loan Trust 6.750% due 08/25/2028 85 85 Countrywide Home Loans 6.750% due 11/25/2027 10 10 6.500% due 03/25/2029 100 96 7.750% due 01/25/2031 249 256 DLJ Mortgage Acceptance Corp. 7.000% due 06/25/2028 138 141 Fannie Mae 6.900% due 08/25/2011 100 101 6.500% due 02/25/2019 725 727 7.750% due 08/25/2022 66 70 7.500% due 03/25/2023 100 106 7.625% due 04/25/2023 (d) 25 25 7.000% due 09/25/2023 17 17 6.750% due 09/25/2023 55 54 6.500% due 09/25/2023 37 37 6.500% due 10/25/2023 217 209 6.500% due 12/25/2023 176 168 7.100% due 12/25/2023 72 72 5.980% due 04/18/2028 (d) 111 111 Freddie Mac 6.000% due 06/15/2008 405 407 4.500% due 03/15/2021 47 45 3.500% due 12/15/2022 10 8 6.500% due 12/15/2023 48 46 6.500% due 03/15/2024 110 107 6.900% due 04/15/2026 946 961 8.000% due 06/15/2026 73 77 6.500% due 05/15/2027 73 71 7.000% due 01/15/2028 433 423 6.000% due 10/15/2028 153 143 General Electric Capital Mortgage Services, Inc. 5.250% due 11/25/2008 1,117 1,119 7.000% due 01/25/2028 100 101 6.750% due 06/25/2028 200 199 Government National Mortgage Association 7.500% due 04/20/2013 1,507 1,507 7.500% due 12/20/2022 70 71 7.000% due 07/16/2026 180 182 Mellon Residential Funding Corp. 6.580% due 07/25/2029 (d) 410 415 Norwest Asset Securities Corp. 6.250% due 09/25/2028 485 464 6.250% due 01/25/2029 167 165 PNC Mortgage Securities Corp. 6.750% due 09/25/2028 1,099 1,093 Residential Accredit Loans, Inc. 7.000% due 01/25/2028 306 308 Superannuation Members Home Loans Global Fund 6.835% due 06/15/2026 (d) 300 300 Vendee Mortgage Trust 7.750% due 05/15/2022 39 41 ------------- 12,192 ------------- Fannie Mae 20.0% 5.500% due 12/01/2030 $ 990 $ 940 5.805% due 10/01/2028 (d) 471 474 6.483% due 11/01/2018 (d) 40 40 6.500% due 04/16/2031 2,500 2,490 7.000% due 05/14/2031 500 505 7.217% due 08/01/2026 (d) 120 124 7.519% due 05/01/2023 (d) 156 161 8.114% due 04/01/2026 (d) 57 58 9.000% due 01/01/2020 215 229 ------------- 5,021 ------------- Federal Housing Administration 6.8% 7.430% due 06/01/2019 1,706 1,702 Freddie Mac 15.3% 6.000% due 10/01/2024-05/14/2031 (c) 2,645 2,579 6.759% due 02/01/2018 (d) 144 144 7.000% due 05/14/2031 1,000 1,012 7.894% due 11/01/2028 (d) 96 100 ------------- 3,835 ------------- Government National Mortgage Association 32.2% 7.125% due 10/20/2022 (d) 128 132 7.375% due 03/20/2016-03/20/2027 (c)(d) 1,184 1,200 7.500% due 05/15/2027-04/23/2031 (c) 4,616 4,729 7.625% due 12/20/2021-11/20/2026 (c)(d) 218 224 7.750% due 07/20/2022-07/20/2025 (c)(d) 475 487 8.000% due 04/23/2031 1,250 1,290 ------------- 8,062 ------------- Stripped Mortgage-Backed Securities 0.8% Fannie Mae (IO) 6.500% due 07/25/2007 37 1 Fannie Mae (PO) 0.000% due 07/25/2022 264 204 ------------- 205 ------------- Total Mortgage-Backed Securities 31,017 (Cost $30,390) ------------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 1.6% -------------------------------------------------------------------------------- Bayview Financial Acquisition Trust 6.103% due 07/25/2030 (d) 179 179 MLCC Mortgage Investors, Inc. 5.948% due 03/15/2025 (d) 222 222 ------------- Total Asset-Backed Securities 401 (Cost $400) ------------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 0.0% -------------------------------------------------------------------------------- Industrial 0.0% Clear Channel Communications, Inc. 1.500% due 12/01/2002 10 9 ------------- Total Convertible Bonds & Notes 9 (Cost $10) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 22.8% -------------------------------------------------------------------------------- Commercial Paper 22.6% Abbey National North America 5.020% due 08/08/2001 300 295 American Express Credit Corp. 5.620% due 04/06/2001 200 200 Becton Dickinson & Co. 6.110% due 04/25/2001 400 398 Executive Jet, Inc. 5.240% due 06/27/2001 500 494 General Electric Capital Corp. 5.370% due 04/04/2001 100 100 5.020% due 04/25/2001 400 399 Halifax PLC 4.600% due 08/02/2001 700 688 KFW International Finance, Inc. 5.450% due 04/24/2001 300 299 5.010% due 08/08/2001 200 197 National Rural Utilities Cooperative Finance Corp. 4.810% due 05/24/2001 700 696 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 129 Schedule of Investments (Cont.) Total Return Mortgage Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SBC Communications, Inc. 5.290% due 04/10/2001 $ 500 $ 499 Swedbank, Inc. 5.040% due 08/08/2001 400 393 UBS Finance, Inc. 5.460% due 06/06/2001 600 595 5.340% due 06/06/2001 400 396 ------------ 5,649 ------------ Repurchase Agreement 0.2% State Street Bank 4.600% due 04/02/2001 59 59 (Dated 03/30/2001. Collateralized by Fannie Mae 6.100% due 09/14/2001 valued at $61. Repurchase proceeds are $59.) ------------ Total Short-Term Instruments 5,708 (Cost $5,707) ------------ Total Investments (a) 148.3% $ 37,190 (Cost $36,562) Other Assets and Liabilities (Net) (48.3%) (12,122) ------------ Net Assets 100.0% $ 25,068 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $36,560 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 640 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (10) ------------ Unrealized appreciation-net $ 630 ------------ (b) Principal amount of the security is adjusted for inflation. (c) Securities are grouped by coupon or range of coupons and represent a range of maturities. (d) Variable rate security. The rate listed is as of March 31, 2001. 130 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments GNMA Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 5.3% -------------------------------------------------------------------------------- Small Business Administration 7.449% due 08/01/2010 $ 499 $ 527 ------------- Total U.S. Government Agencies 527 (Cost $500) ------------- U.S. TREASURY OBLIGATIONS 33.0% Treasury Inflation Protected Securities (d) 3.250% due 07/15/2002 109 111 3.375% due 01/15/2007 (e) 2,210 2,235 3.625% due 01/15/2008 108 111 U.S. Treasury Strips 0.000% due 05/15/2013 (e) 1,600 838 ------------- Total U.S. Treasury Obligations 3,295 (Cost $3,261) ------------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 98.1% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 31.1% ABN AMRO Mortgage Corp. 6.750% due 04/25/2029 229 201 Countrywide Home Loans 6.500% due 02/25/2009 144 143 Fannie Mae 7.000% due 05/25/2006 75 75 6.000% due 11/18/2017 128 129 6.500% due 02/25/2019 725 728 7.000% due 09/25/2021 1,850 168 6.500% due 09/25/2023 293 278 Freddie Mac 6.500% due 11/25/2023 129 122 7.500% due 08/15/2029 854 165 General Electric Capital Mortgage Services, Inc. 6.750% due 06/25/2028 50 50 Government National Mortgage Association 7.500% due 09/16/2027 563 562 Residential Accredit Loans, Inc. 7.000% due 01/25/2028 474 477 ------------- 3,098 ------------- Fannie Mae 1.0% 7.780% due 03/01/2018 (b) 42 44 9.000% due 07/01/2018 58 61 ------------- 105 ------------- Federal Housing Administration 1.6% 7.430% due 03/01/2022 163 162 ------------- Freddie Mac 6.7% 6.655% due 06/01/2030 (b) 99 100 6.871% due 05/01/2019 (b) 60 61 8.137% due 09/01/2040 475 505 ------------- 666 ------------- National Mortgage Association 56.3% 6.500% due 04/23/2031 (b) 1,000 1,000 7.375% due 05/20/2016-02/20/2026 (b)(c) 900 914 7.500% due 10/20/2030-04/23/2031 (b)(c) 2,139 2,184 7.625% due 12/20/2017 (b) 81 83 7.750% due 07/20/2018-08/20/2025 (b)(c) 270 276 8.000% due 05/21/2031 1,000 1,032 11.250% due 07/20/2015 117 129 ------------- 5,618 ------------- Stripped Mortgage-Backed Securities 1.4% Hilton Hotel Pool Trust (IO) 1.000% due 10/01/2016 2,987 137 ------------- Total Mortgage-Backed Securities 9,786 (Cost $9,684) ------------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 19.4% -------------------------------------------------------------------------------- Advanta Business Card Master Trust 6.457% due 04/20/2008 (b) $ 100 $ 102 Chase Funding Mortgage Loan Asset-Backed Certificates 7.330% due 10/25/2030 (b) 200 198 Conseco Finance 9.290% due 12/15/2029 500 529 CS First Boston Mortgage Securities Corp. 6.620% due 09/25/2009 12 12 Fingerhut Master Trust 6.487% due 02/15/2005 (b) 300 299 General Electric Capital Mortgage Services, Inc. 7.200% due 04/25/2029 292 280 Indymac Home Equity Loan Asset-Backed Trust 6.126% due 12/25/2031 (b) 200 202 NPF XII, Inc. 6.001% due 10/01/2003 (b) 300 300 The Money Store Home Equity Trust 6.345% due 11/15/2021 12 12 ------------- Total Asset-Backed Securities 1,934 (Cost $1,893) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 14.2% -------------------------------------------------------------------------------- Commercial Paper 13.0% CBA (de) Finance 4.990% due 04/23/2001 300 299 General Electric Capital Corp. 4.970% due 04/04/2001 200 200 National Rural Utilities Cooperative Finance Corp. 4.880% due 05/25/2001 400 397 Swedbank, Inc. 5.150% due 04/25/2001 400 399 ------------- 1,295 ------------- Repurchase Agreement 1.2% State Street Bank 4.600% due 04/02/2001 115 115 (Dated 03/30/2001. Collateralized by Freddie Mac 5.500% due 02/13/2004 valued at $121. Repurchase proceeds are $115.) ------------- Total Short-Term Instruments 1,410 (Cost $1,410) ------------- Total Investments (a) 170.0% $ 16,952 (Cost $16,748) Other Assets and Liabilities (Net) (70.0%) (6,978) ------------- Net Assets 100.0% $ 9,974 ------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $16,747 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 259 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (54) ------------- Unrealized appreciation-net $ 205 ------------- (b) Variable rate security. The rate listed is as of March 31, 2001. (c) Securities are grouped by coupon or range of coupons and represent a range of maturities. (d) Principal amount of the security is adjusted for inflation. (e) Subject to financing transaction. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 131 Schedule of Investments Real Return Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 35.7% -------------------------------------------------------------------------------- Banking & Finance 23.5% Allied Irish Banks 6.495% due 09/07/2006 (d) $ 1,200 $ 1,211 Allstate Financial Global Funding 7.125% due 09/26/2005 2,500 2,633 Associates Corp. of North America 5.400% due 08/27/2001 (d) 1,500 1,504 7.003% due 05/08/2003 (d) 1,500 1,503 AT&T Capital Corp. 7.110% due 09/13/2001 500 504 5.881% due 04/23/2002 (d) 1,000 1,002 Atlas Reinsurance PLC 9.071% due 04/04/2003 (d) 3,500 3,500 10.470% due 10/04/2004 (d) 4,400 4,400 Bear Stearns Co., Inc. 5.900% due 08/01/2002 (d) 500 500 5.270% due 09/21/2004 (d) 1,000 1,000 Chase Manhattan Corp. 5.360% due 12/10/2001 (d) 500 501 CIT Group, Inc. 6.750% due 05/14/2001 1,000 1,002 Citicorp 4.992% due 09/17/2001 (d) 335 335 Dime Bancorp, Inc. 7.000% due 07/25/2001 4,225 4,235 Donaldson, Lufkin & Jenrette, Inc. 7.210% due 04/25/2003 (d) 7,500 7,503 DQE Capital Corp. 7.233% due 01/15/2002 (d) 1,000 1,000 Export-Import Bank Korea 6.500% due 11/15/2006 2,500 2,547 Finova Capital Corp. 6.040% due 11/08/2002 (d) 2,800 2,299 First Union Corp. 7.550% due 08/18/2005 10,000 10,610 Florida Windstorm Underwriting Association 6.700% due 08/25/2004 500 511 Ford Motor Credit Co. 6.993% due 07/16/2002 (d) 1,000 1,000 6.885% due 02/13/2003 (d) 350 348 5.190% due 06/20/2003 (d) 18,500 18,484 General Motors Acceptance Corp. 5.273% due 12/09/2002 (d) 2,000 2,003 7.035% due 07/21/2003 (d) 3,500 3,505 Gold Eagle Capital Ltd. 11.078% due 04/15/2001 2,440 2,440 9.748% due 04/15/2001 1,000 1,000 Heller Financial, Inc. 6.893% due 04/26/2002 (d) 250 250 6.500% due 07/22/2002 1,000 1,015 7.500% due 08/23/2002 8,200 8,414 6.635% due 04/28/2003 (d) 3,000 2,992 Household Finance Corp. 5.772% due 08/06/2002 (d) 2,000 2,006 J.P. Morgan & Co., Inc. 6.654% due 02/15/2012 (d) 3,170 2,895 Juno RE Ltd. 10.367% due 06/26/2002 (d) 8,050 7,849 Korea Development Bank 5.885% due 03/01/2002 (d) 500 488 8.008% due 06/16/2003 (d) 500 490 Lehman Brothers Holdings, Inc. 5.388% due 06/03/2002 (d) 2,500 2,502 7.533% due 07/15/2002 (d) 600 604 7.015% due 09/03/2002 (d) 2,000 2,000 MBNA America Bank NA 6.560% due 04/25/2002 (d) 500 500 Merrill Lynch & Co. 6.791% due 11/01/2001 (d) 1,700 1,702 7.085% due 02/08/2002 (d) 400 401 6.768% due 02/04/2003 (d) 2,000 2,003 6.991% due 08/01/2003 (d) 4,000 4,011 Monumental Global Funding II 5.106% due 09/26/2003 (d) 2,000 2,001 Morgan Stanley, Dean Witter & Co. 6.883% due 04/15/2002 (d) 1,000 1,002 5.583% due 02/21/2003 (d) 1,500 1,502 6.767% due 03/13/2003 (d) 2,000 2,000 National Australia Bank Ltd. 6.035% due 05/19/2010 (d) 1,500 1,510 National Rural Utilities Cooperative Finance Corp. 6.880% due 05/31/2002 (d) 1,900 1,902 5.337% due 08/13/2002 (d) 10,000 10,002 National Westminster Bank PLC 5.520% due 09/16/2002 (d) 3,500 3,512 NeHi, Inc. 11.310% due 06/09/2003 (d) 3,000 3,030 Old Kent Bank 6.275% due 11/01/2005 (d) 1,000 999 Pemex Finance Ltd. 6.125% due 11/15/2003 367 364 Premium Asset Trust 7.078% due 11/27/2004 (d) 5,000 5,011 Protective Life Funding Trust 7.090% due 01/17/2003 (d) 1,000 1,002 Prudential Funding Corp. 5.968% due 10/18/2001 (d) 3,000 3,004 6.375% due 07/23/2006 2,000 2,026 PS Colorado Credit Corp. 7.398% due 05/30/2002 (d) 1,300 1,299 Qwest Capital Funding, Inc. 7.195% due 07/08/2002 (d) 1,000 1,001 Residential Reinsurance 10.836% due 06/01/2001 (d) 7,200 7,265 10.926% due 06/01/2001 (d) 9,000 9,000 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 17,433 17,528 6.962% due 04/28/2003 (d) 3,000 3,003 Seismic Ltd. 10.901% due 01/01/2002 (d) 2,500 2,485 Textron Financial Corp. 6.963% due 10/26/2001 (d) 2,500 2,504 7.033% due 09/17/2002 (d) 5,000 5,009 5.423% due 12/09/2002 (d) 1,000 1,002 Toyota Motor Credit Corp. 5.388% due 02/15/2002 (d) 400 401 Western Capital 10.665% due 01/07/2003 5,000 5,003 ------------- 211,569 ------------- Industrials 5.8% AIC Corp. 6.153% due 10/02/2002 (d) 250 250 Alpha Wind 11.321% due 05/23/2001 (d) 1,500 1,500 Coastal Corp. 7.330% due 07/21/2003 (d) 8,000 8,022 Cox Enterprises, Inc. 7.658% due 05/01/2033 (d) 2,000 2,001 DaimlerChrysler North America Holding Corp. 5.790% due 12/16/2002 (d) 2,000 1,992 7.078% due 08/16/2004 (d) 5,000 4,874 Delta Air Lines, Inc. 8.540% due 01/02/2007 3,734 3,825 Enron Corp. 5.510% due 09/10/2001 (d) 2,500 2,502 8.000% due 08/15/2005 3,000 3,217 Fred Meyer, Inc. 7.375% due 03/01/2005 2,000 2,095 Global Crossing Holding Ltd. 6.000% due 10/15/2013 1,250 1,185 HCA - The Healthcare Co. 6.442% due 09/19/2002 (d) 8,000 8,000 Petroleos Mexicanos 9.500% due 09/15/2027 4,750 4,976 Philip Morris Cos., Inc. 7.250% due 09/15/2001 1,000 1,007 132 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Raytheon Co. 7.020% due 08/10/2001 (d) $ 1,600 $ 1,602 Staples, Inc. 6.195% due 11/26/2001 (d) 2,000 2,002 United Air Lines, Inc. 5.272% due 12/02/2002 (d) 1,179 1,177 Waste Management, Inc. 7.100% due 08/01/2026 1,500 1,521 ------------- 51,748 ------------- Utilities 6.4% Allete 7.610% due 10/20/2003 (d) 2,500 2,503 Commonwealth Edison Co. 7.158% due 09/30/2002 (d) 1,000 1,001 Deutsche Telekom AG 7.750% due 06/15/2005 10,000 10,333 Dominion Resources, Inc. 7.230% due 09/16/2002 (d) 3,500 3,514 7.600% due 07/15/2003 5,000 5,206 Entergy Gulf States, Inc. 6.303% due 06/02/2003 (d) 4,500 4,506 Hawaiian Electric Industries, Inc. 7.783% due 04/15/2003 (d) 2,000 2,002 Oneok, Inc. 6.231% due 04/24/2002 (d) 2,000 2,003 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(i) 5,000 4,125 Public Service Enterprise Group, Inc. 5.408% due 06/15/2001 (d) 500 500 Scana Corp. 7.253% due 02/08/2002 (d) 1,900 1,902 7.393% due 07/15/2002 (d) 3,900 3,907 Sierra Pacific Resources 6.298% due 04/20/2002 (d) 1,000 850 7.340% due 04/20/2003 (d) 2,000 1,700 Sprint Capital Corp. 5.678% due 11/15/2001 (d) 1,000 1,001 5.410% due 06/10/2002 (d) 3,000 3,005 Texas Utilities Corp. 5.420% due 06/25/2001 (d) 1,300 1,300 5.781% due 09/24/2001 (d) 500 499 Vodafone Group PLC 5.080% due 12/19/2001 (d) 6,500 6,511 WorldCom, Inc. 7.375% due 01/15/2003 1,000 1,012 ------------- 57,380 ------------- Total Corporate Bonds & Notes 320,697 (Cost $319,838) ------------- -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.6% -------------------------------------------------------------------------------- Florida 0.4% Tampa, Florida Utility Tax & Special Revenue Bond, (AMBAC Insured), Series 2000 6.000% due 10/01/2004 3,580 3,853 ------------- New Mexico 0.0% New Mexico Mortgage Finance Authorities Revenue Bonds, (GNMA,FNMA, FHLMC Insured), Series 1997 7.000% due 07/01/2006 215 225 ------------- New York 0.0% New York City General Obligation Bonds 5.660% due 08/01/2002 (d) 76 76 ------------- Ohio 0.2% Hamilton, Ohio School Districts Gas Supply Revenue Bonds, Northern Ohio, (MBIA Insured), Series 1999 6.910% due 08/01/2001 1,500 1,512 ------------- Total Municipal Bonds & Notes 5,666 (Cost $5,510) ------------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 1.2% -------------------------------------------------------------------------------- Fannie Mae 5.440% due 03/13/2002 (d) 6,100 6,128 Federal Farm Credit Bank 2.868% due 02/14/2002 (d) 600 602 Federal Home Loan Bank 5.917% due 02/15/2002 (d) 2,485 2,497 SallieMae 6.779% due 10/25/2004 (d) 56 56 6.787% due 04/25/2006 (d) 1,245 1,243 6.694% due 01/25/2007 (d) 249 249 ------------- Total U.S. Government Agencies 10,775 (Cost $10,662) ------------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 107.8% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (g) 3.625% due 07/15/2002 (b)(c) 192,506 196,296 3.375% due 01/15/2007 (c) 166,955 168,782 3.625% due 01/15/2008 163,335 167,163 3.875% due 01/15/2009 (c) 151,184 157,231 3.625% due 04/15/2028 94,944 96,813 3.875% due 04/15/2029 (c) 170,847 182,379 ------------- Total U.S. Treasury Obligations 968,664 (Cost $935,531) ------------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 2.0% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 2.0% Bear Stearns Adjustable Rate Mortgage Trust 7.674% due 11/25/2030 (d) 4,754 4,775 CMC Securities Corp. 6.000% due 11/25/2008 207 207 Fannie Mae 5.462% due 10/25/2008 (d) 108 108 6.500% due 02/25/2029 126 105 Freddie Mac 7.000% due 07/15/2022 1,827 1,837 6.500% due 01/25/2028 100 98 7.000% due 10/15/2030 3,000 3,069 GMAC Commercial Mortgage Asset Corp. 5.307% due 07/20/2002 (d) 7,401 7,401 ------------- 17,600 ------------- Fannie Mae 0.0% 9.021% due 10/01/2024 (d) 410 424 ------------- Federal Housing Administration 0.0% 7.430% due 12/01/2020 296 296 ------------- Total Mortgage-Backed Securities 18,320 (Cost $18,228) ------------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 3.9% -------------------------------------------------------------------------------- AESOP Funding II LLC 5.830% due 11/20/2006 (d) 14,000 13,924 AFC Home Equity Loan Trust 5.270% due 03/25/2027 (d) 170 170 American Residential Eagle Trust 5.870% due 07/25/2029 (d) 5,453 5,466 Asset Backed Securities Corp. Home Equity 5.377% due 06/21/2029 (d) 4,451 4,465 Conseco Finance 7.890% due 07/15/2018 2,000 2,095 8.170% due 12/15/2025 2,000 2,103 Conseco Finance Home Loan Trust 8.880% due 06/15/2024 750 797 EQCC Home Equity Loan Trust 5.483% due 03/20/2029 (d) 165 165 IMC Home Equity Loan Trust 6.610% due 06/20/2013 28 28 MMCA Automobile Trust 6.300% due 06/15/2002 567 568 Onyx Acceptance Auto Trust 6.590% due 09/15/2002 187 188 6.350% due 10/15/2003 239 239 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 133 Schedule of Investments (Cont.) Real Return Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SallieMae 6.481% due 07/25/2004 (d) $ 52 $ 52 USAA Auto Loan Grantor Trust 5.800% due 01/15/2005 177 178 Voicestream Vender Facility 9.620% due 06/30/2009 5,000 4,965 ------------- Total Asset-Backed Securities 35,406 (Cost $35,210) ------------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 0.0% -------------------------------------------------------------------------------- United Mexican States 0.000% due 06/30/2003 718 9 ------------- Total Sovereign Issues 9 (Cost $0) ------------- -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES (e)(f) 1.1% -------------------------------------------------------------------------------- Caisse D'amort Dette Soc 3.800% due 07/25/2006 EC 5,084 4,553 Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 4,800 2,127 Newcourt Credit Group, Inc. 7.625% due 06/28/2001 C$ 500 318 Republic of France 3.000% due 07/25/2009 EC 2,553 2,177 United Mexican States 1.352% due 12/31/2019 (d) JY 70,000 547 ------------- Total Foreign Currency-Denominated 9,722 Issues (Cost $10,365) ------------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 0.4% -------------------------------------------------------------------------------- Industrial 0.4% Nabors Industries, Inc. 0.010% due 06/20/2020 $ 5,000 3,538 ------------- Total Convertible Bonds & Notes 3,538 (Cost $3,097) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 20.6% -------------------------------------------------------------------------------- Commercial Paper 20.5% Abbey National North America 5.240% due 04/10/2001 2,200 2,197 4.930% due 08/01/2001 7,100 6,983 American Express Credit Corp. 5.300% due 04/04/2001 5,000 4,999 6.250% due 04/06/2001 4,700 4,697 6.360% due 04/06/2001 600 600 Becton Dickinson & Co. 6.110% due 04/09/2001 600 599 Campbell Soup Co. 6.270% due 04/16/2001 300 299 Coca-Cola Co. 5.140% due 04/12/2001 2,000 1,997 Fannie Mae 4.700% due 05/16/2001 500 497 Federal Farm Credit Bank 4.630% due 08/29/2001 19,000 18,624 General Electric Capital Corp. 5.470% due 04/18/2001 700 699 4.900% due 04/25/2001 8,700 8,673 5.350% due 05/09/2001 9,000 8,951 4.870% due 05/30/2001 8,500 8,433 4.600% due 07/18/2001 1,600 1,577 Halifax PLC 5.300% due 06/06/2001 12,500 12,386 5.010% due 08/08/2001 900 884 KFW International Finance, Inc. 5.170% due 06/27/2001 19,000 18,778 5.010% due 08/08/2001 600 590 National Rural Utilities Cooperative Finance Corp. 5.130% due 04/17/2001 7,000 6,985 5.280% due 04/19/2001 4,300 4,289 4.880% due 05/25/2001 6,600 6,553 SBC Communications, Inc. 5.290% due 04/10/2001 6,400 6,392 Swedbank, Inc. 5.020% due 08/08/2001 4,600 4,521 UBS Finance, Inc. 5.470% due 04/09/2001 4,400 4,395 5.410% due 05/16/2001 600 596 5.290% due 06/13/2001 12,500 12,375 5.040% due 08/02/2001 2,500 2,459 5.070% due 08/08/2001 1,500 1,474 5.040% due 08/15/2001 2,800 2,749 4.750% due 09/05/2001 3,000 2,938 4.740% due 09/06/2001 8,600 8,422 Verizon Global Funding 5.010% due 05/16/2001 10,000 9,939 4.950% due 06/15/2001 3,500 3,464 Walt Disney Co. 4.900% due 08/07/2001 5,000 4,914 ------------- 184,928 ------------- Repurchase Agreement 0.1% State Street Bank 4.600% due 04/02/2001 673 673 (Dated 03/30/2001. Collateralized by Freddie Mac 6.680% due 12/28/2001 valued at $690. Repurchase proceeds are $673.) ------------- Total Short-Term Instruments 185,601 (Cost $185,577) ------------- Total Investments (a) 173.3% $ 1,558,398 (Cost $1,524,018) Other Assets and Liabilities (Net) (73.3%) (659,298) ------------- Net Assets 100.0% $ 899,122 ------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,524,669 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 36,825 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (3,096) ------------- Unrealized appreciation-net $ 33,729 ------------- (b) Securities with an aggregate market value of $889 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 2 Year Note (06/2001) 85 $ (88) United Kingdom 90 Day LIBOR Futures (09/2002) 38 (3) ------------- $ (91) ------------- (c) Subject to financing transaction. (d) Variable rate security. The rate listed is as of March 31, 2001. 134 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes -------------------------------------------------------------------------------- (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) ---------------------------------------------------------------- Sell C$ 560 04/2001 $ 7 Buy EC 7,813 04/2001 (26) Sell 7,813 04/2001 372 Sell 7,813 06/2001 26 Sell JY 78,994 04/2001 35 Buy 78,994 04/2001 (15) Sell 78,994 06/2001 15 Sell N$ 5,169 04/2001 89 --------------- $ 503 --------------- (f) Principal amount denoted in indicated currency: C$ - Canadian Dollar EC - Euro JY - Japanese Yen N$ - New Zealand Dollar (g) Principal amount of security is adjusted for inflation. (h) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 0.470% and pay a fixed rate equal to 7.750%. Broker: Morgan Stanley Exp. 06/15/2005 $ 10,000 $ (735) Receive floating rate based on 3-month LIBOR plus 0.500% and pay a fixed rate equal to 7.600%. Broker: Lehman Brothers Exp. 07/15/2003 5,000 (235) Receive floating rate based on 3-month LIBOR plus 1.000% and pay to the counterparty the notional amount of $5,000 in exchange for shares of Nabors Industries, Inc. due 6/20/2020 when the convertible debentures mature. Broker: Morgan Stanley Exp. 06/20/2003 3,042 (116) Receive fixed rate equal to 0.410% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Goldman Sachs Exp. 11/10/2002 1,000 0 ----------- $ (1,086) ----------- (i) Security is in default. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 135 Schedule of Investments Foreign Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- AUSTRALIA (e)(f) 2.2% -------------------------------------------------------------------------------- General Electric Capital Australia Funding 6.750% due 09/15/2007 A$ 750 $ 390 General Motors Acceptance Corp. 4.849% due 03/25/2002 (d) EC 10,300 9,038 Registered Australian Mortgage Securities 5.138% due 09/26/2032 (d) 2,840 2,498 Torrens Trust 5.424% due 07/15/2031 (d) $ 2,776 2,776 ------------- Total Australia 14,702 (Cost $15,826) ------------- -------------------------------------------------------------------------------- AUSTRIA (e)(f) 0.2% -------------------------------------------------------------------------------- Republic of Austria 5.500% due 01/15/2010 (i) EC 1,200 1,093 ------------- Total Austria 1,093 (Cost $1,041) ------------- -------------------------------------------------------------------------------- BELGIUM (e)(f) 2.4% -------------------------------------------------------------------------------- Kingdom of Belgium 9.000% due 03/28/2003 EC 5 5 5.100% due 11/21/2004 (d) BF 183,200 4,290 7.500% due 07/29/2008 (i) EC 10,500 10,669 5.000% due 09/28/2011 (i) 1,700 1,485 ------------- Total Belgium 16,449 (Cost $18,926) ------------- -------------------------------------------------------------------------------- BRAZIL (e)(f) 0.9% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (d) $ 7,040 6,380 ------------- Total Brazil 6,380 (Cost $6,570) ------------- -------------------------------------------------------------------------------- CANADA (e)(f) 9.2% -------------------------------------------------------------------------------- Beneficial Canada, Inc. 6.350% due 04/01/2002 C$ 3,440 2,211 Commonwealth of Canada 5.250% due 09/01/2003 640 410 6.000% due 09/01/2005 (i) 52,500 34,482 7.250% due 06/01/2007 (i) 34,500 24,151 5.500% due 06/01/2010 1,800 1,149 ------------- Total Canada 62,403 (Cost $63,801) ------------- -------------------------------------------------------------------------------- CAYMAN ISLANDS (e)(f) 1.2% -------------------------------------------------------------------------------- Capital Credit Card Corp. Ltd. 5.625% due 10/15/2004 DM 2,800 1,262 International Credit Receivable Japan 0.746% due 08/25/2005 JY 50,000 398 5.602% due 03/15/2010 1,800 1,585 MBNA American Euro 4.887% due 05/19/2004 (d) EC 8,100 7,116 ------------- Total Cayman Islands 10,361 (Cost $12,305) ------------- -------------------------------------------------------------------------------- DENMARK (e)(f) 1.7% -------------------------------------------------------------------------------- Lb Rheinland - PFALZ 4.750% due 04/04/2008 EC 5,330 4,633 Nykredit 6.000% due 10/01/2009 DK 29,895 3,415 Unikredit Realkredit 6.000% due 07/01/2029 27,036 3,098 ------------- Total Denmark 11,146 (Cost $10,934) ------------- -------------------------------------------------------------------------------- FRANCE (e)(f) 10.2% -------------------------------------------------------------------------------- Axa 2.500% due 01/01/2014 EC 835 729 Republic of France 5.500% due 04/25/2007 (i) 7,890 7,320 4.000% due 04/25/2009 (i) 8,250 6,924 3.000% due 07/25/2009 3,115 2,656 4.000% due 10/25/2009 (i) 46,070 38,104 5.500% due 04/25/2010 13,960 12,913 ------------- Total France 68,646 (Cost $70,890) ------------- -------------------------------------------------------------------------------- GERMANY (e)(f) 18.4% -------------------------------------------------------------------------------- Commerzbank AG 5.206% due 10/25/2032 (d) EC 6,200 5,470 Depfa Pfandbriefbank 4.750% due 07/15/2008 3,590 3,106 5.750% due 03/04/2009 (i) 3,560 3,270 DT Hypothekenbank 3.500% due 07/03/2006 7,000 5,798 Hypothekenbank in Essen AG 5.500% due 02/20/2007 1,690 1,620 Landesbank Baden-Wuerttemberg AG 5.500% due 04/02/2007 3,240 2,943 Republic of Germany 6.000% due 07/04/2007 (i) 26,200 24,913 5.250% due 01/04/2008 (i) 35,730 32,802 4.125% due 07/04/2008 (i) 21,500 18,375 4.500% due 07/04/2009 (i) 19,100 16,618 5.375% due 01/04/2010 (i) 1,750 1,615 6.250% due 01/04/2024 (i) 1,880 1,841 6.250% due 01/04/2030 (i) 1,700 1,688 Rheinische Hypothekenbank AG 4.250% due 09/24/2008 3,310 2,763 WestDeutsche Landersbank 4.750% due 09/28/2007 1,630 1,421 ------------- Total Germany 124,243 (Cost $123,367) ------------- -------------------------------------------------------------------------------- GREECE (e)(f) 0.4% -------------------------------------------------------------------------------- Hellenic Finance 2.000% due 07/15/2003 EC 1,600 1,409 Hellenic Republic 7.850% due 05/19/2003 (d) GD 293 266 7.890% due 06/17/2003 (d) 315 287 7.080% due 10/23/2003 (d) 1,103 1,018 ------------- Total Greece 2,980 (Cost $3,926) ------------- -------------------------------------------------------------------------------- ITALY (e)(f) 14.5% -------------------------------------------------------------------------------- Finmeccanica SpA 2.000% due 06/08/2005 EC 544 461 First Italian Auto Transaction 5.139% due 07/01/2008 (d) 7,230 6,363 Island Finance 5.404% due 03/30/2015 (d) 2,684 2,372 Republic of Italy 5.750% due 09/15/2002 (i) 26,400 23,681 7.750% due 11/01/2006 (i) 5,700 5,738 4.500% due 05/01/2009 (i) 64,110 54,593 4.250% due 11/01/2009 (i) 5,560 4,639 ------------- Total Italy 97,847 (Cost $100,861) ------------- 136 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- JAPAN (e)(f) 1.7% -------------------------------------------------------------------------------- Government of Japan 0.900% due 12/22/2008 (d)(i) JY 907,400 $ 7,180 International Credit Receivable Japan 1 Tranche A 0.863% due 08/25/2005 132,610 1,056 SHL Corp. Ltd. 1.031% due 12/25/2024 (d) 76,618 610 1.331% due 12/25/2024 (d) 76,000 605 ------------- Total Japan 9,451 (Cost $10,447) ------------- -------------------------------------------------------------------------------- MEXICO (e)(f) 0.9% -------------------------------------------------------------------------------- Petroleos Mexicanos 8.850% due 09/15/2007 $ 1,040 1,070 9.375% due 12/02/2008 1,290 1,345 United Mexican States 8.750% due 05/30/2002 BP 960 1,385 10.375% due 01/29/2003 DM 2,575 1,233 4.000% due 03/11/2004 JY 130,000 1,062 ------------- Total Mexico 6,095 (Cost $6,454) ------------- -------------------------------------------------------------------------------- NETHERLANDS (e)(f) 0.6% -------------------------------------------------------------------------------- Unilever NV 4.830% due 09/17/2001 (d) EC 4,800 4,204 ------------- Total Netherlands 4,204 (Cost $4,096) ------------- -------------------------------------------------------------------------------- NEW ZEALAND (e)(f) 0.9% -------------------------------------------------------------------------------- Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 13,430 5,951 ------------- Total New Zealand 5,951 (Cost $7,504) ------------- -------------------------------------------------------------------------------- PERU (e)(f) 0.3% -------------------------------------------------------------------------------- Republic of Peru 4.500% due 03/07/2017 (d) $ 2,700 1,843 ------------- Total Peru 1,843 (Cost $1,867) ------------- -------------------------------------------------------------------------------- SOUTH KOREA (e)(f) 2.7% -------------------------------------------------------------------------------- Export-Import Bank Korea 7.250% due 06/25/2001 $ 1,945 1,950 6.500% due 02/10/2002 (d) 800 801 KBC Bank Fund Trust IV 8.220% due 11/29/2049 EC 2,800 2,591 Korea Development Bank 4.885% due 05/14/2001 DM 7,310 3,286 2.770% due 05/21/2001 JY 500,000 3,995 2.450% due 09/10/2001 231,000 1,848 1.875% due 02/13/2002 466,000 3,726 ------------- Total South Korea 18,197 (Cost $19,514) ------------- -------------------------------------------------------------------------------- SPAIN (e)(f) 3.8% -------------------------------------------------------------------------------- Kingdom of Spain 5.150% due 07/30/2009 (i) EC 28,430 25,459 ------------- Total Spain 25,459 (Cost $28,157) ------------- -------------------------------------------------------------------------------- SUPRANATIONAL (e)(f) 1.3% -------------------------------------------------------------------------------- Eurofima 4.750% due 07/07/2004 (i) SK 60,900 5,885 International Bank for Reconstruction & Development 7.250% due 04/09/2001 N$ 6,400 2,581 ------------- Total Supranational 8,466 (Cost $10,093) ------------- -------------------------------------------------------------------------------- SWEDEN (e)(f) 0.7% -------------------------------------------------------------------------------- Kingdom of Sweden 13.000% due 06/15/2001 SK 11,200 $ 1,097 5.000% due 01/28/2009 37,800 3,746 ------------- Total Sweden 4,843 (Cost $5,233) ------------- -------------------------------------------------------------------------------- UNITED KINGDOM (e)(f) 7.5% -------------------------------------------------------------------------------- Abbey National Treasury Service PLC 5.250% due 01/21/2004 BP 2,670 3,766 British Telecommunications PLC 6.079% due 12/15/2003 (d) $ 5,180 5,182 Core 5.138% due 03/17/2009 (d) 3,360 3,339 Halifax Group Euro Finance 7.627% due 12/29/2049 EC 1,040 965 Haus Ltd. 5.124% due 12/10/2037 (d) 8,500 7,481 Holmes Financing PLC 5.859% due 07/15/2017 (d) 5,540 5,541 Lloyds TSB Capital 7.375% due 02/07/2049 BP 500 462 SCCR Series 1 Ltd. 5.373% due12/15/2031 (d) 1,414 1,247 United Kingdom Gilt 7.500% due 12/07/2006 (i) 4,800 7,678 7.250% due 12/07/2007 (i) 4,800 7,712 5.750% due 12/07/2009 (i) 4,690 7,078 ------------- Total United Kingdom 50,451 (Cost $52,225) ------------- -------------------------------------------------------------------------------- UNITED STATES (e)(f) 62.4% -------------------------------------------------------------------------------- Asset-Backed Securities 10.4% Advanta Mortgage Loan Trust 5.383% due 07/25/2026 (d) $ 227 227 AFC Home Equity Loan Trust 5.270% due 03/25/2027 (d) 681 681 5.350% due 07/25/2030 (d) 7,283 7,296 Americredit Automobile Receivable Trust 5.880% due 12/05/2003 161 162 Amresco Residential Securities Mortgage Loan Trust 6.000% due 06/25/2029 (d) 4,603 4,621 Banc One Auto Grantor Trust 6.270% due 11/20/2003 162 163 6.290% due 07/20/2004 321 323 Bayview Financial Acquisition Trust 7.170% due 02/25/2029 (d) 308 309 5.920% due 11/25/2030 (d) 5,100 5,100 Chase Manhattan Grantor Trust 6.610% due 09/15/2002 54 54 Conseco Finance 5.534% due 10/15/2031 (d) 1,176 1,181 CS First Boston Mortgage Securities Corp. 5.424% due 12/15/2030 (d) 5,859 5,865 Delta Funding Home Equity Loan Trust 7.380% due 12/15/2017 398 402 EQCC Home Equity Loan Trust 5.770% due 05/20/2010 757 756 5.484% due 03/20/2030 330 330 First Alliance Mortgage Loan Trust 5.238% due 12/20/2027 (d) 190 190 Green Tree Floorplan Receivables Master Trust 5.921% due 11/15/2004 (d) 2,500 2,501 Nissan Auto Receivables Grantor Trust 5.450% due 04/15/2004 1,108 1,112 Provident Bank Equipment Lease Trust 5.830% due 11/25/2011 (d) 1,732 1,732 Providian Gateway Master Trust 5.380% due 03/15/2007 5,800 5,800 Providian Home Equity Loan Trust 5.340% due 06/25/2025 (d) 3,342 3,346 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 137 Schedule of Investments (Cont.) Foreign Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- PSB Lending Home Loan Owner Trust 6.830% due 05/20/2018 $ 339 $ 342 Residential Asset Securities Corp. 5.770% due 01/25/2032 (d) 10,416 10,429 Residential Funding Mortgage Securities, Inc. 10.836% due 06/01/2001 11,100 11,100 Salomon Brothers Mortgage Securities VII 5.310% due 02/25/2031 (d) 5,734 5,734 USAA Auto Loan Grantor Trust 5.800% due 01/15/2005 478 482 ------------- 70,238 ------------- Corporate Bonds & Notes 12.6% Abbey National Capital Trust I 8.963% due 12/29/2049 2,000 2,218 Allegheny Energy Supply 6.325% due 05/01/2002 (d) 2,900 2,902 Alpha Wind 11.321% due 05/23/2001 (d) 2,000 2,000 Associates First Capital Corp. 5.810% due 01/25/2031 (d) 5,391 5,391 AT&T Capital Corp. 5.881% due 04/23/2002 (d) 675 677 Bancomext Trust Division 8.000% due 08/05/2003 390 397 Bear Stearns Co., Inc. 5.210% due 03/28/2003 (d) 2,670 2,669 Beckman Instruments, Inc. 7.100% due 03/04/2003 344 347 Capital One Bank 6.308% due 07/28/2003 (d) 12,000 11,797 CMS Energy Corp. 8.125% due 05/15/2002 546 553 DaimlerChrysler North America Holding Corp. 5.640% due 08/23/2002 (d) 3,900 3,868 DQE Capital Corp. 6.179% due 01/15/2002 (d) 800 800 Finova Capital Corp. 5.193% due 06/18/2003 (d)(j) 5,700 4,674 Ford Motor Credit Co. 1.000% due 12/22/2003 JY 107,000 854 6.089% due 07/19/2004 (d) $ 2,800 2,781 1.200% due 02/07/2005 JY 619,000 4,925 General Motors Acceptance Corp. 1.250% due 12/20/2004 208,000 1,665 Gold Eagle Capital Ltd. 11.079% due 04/15/2001 (d) $ 2,500 2,500 International Game Technology 7.875% due 05/15/2004 1,700 1,726 J.P. Morgan & Co., Inc. 6.655% due 02/15/2012 (d) 4,670 4,264 Jones Intercable, Inc. 8.875% due 04/01/2007 427 458 MGM Grand, Inc. 6.950% due 02/01/2005 180 180 NeHi, Inc. 11.379% due 06/09/2003 (d) 2,000 2,020 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(j) 2,700 2,228 Protective Life Funding Trust 6.089% due 01/17/2003 (d) 1,200 1,202 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (h) 13,375 13,449 5.629% due 02/11/2003 (d) 400 401 Sprint Capital Corp. 5.875% due 05/01/2004 690 678 Texas Utilities Corp. 7.389% due 09/24/2001 (d) 2,600 2,592 Texas Utilities Electric Co. 5.650% due 12/20/2002 (d) 1,500 1,501 WorldCom, Inc. 7.375% due 01/15/2003 (d) 3,100 3,136 ------------- 84,853 ------------- Mortgage-Backed Securities 22.5% Bank of America Mortgage Securities, Inc. 6.500% due 05/25/2029 291 286 Bear Stearns Adjustable Rate Mortgage Trust 6.944% due 02/25/2031 (d) 4,569 4,614 Chase Mortgage Finance Corp. 6.550% due 08/25/2028 1,906 1,924 Citicorp Mortgage Securities, Inc. 6.500% due 07/25/2028 1,766 1,775 6.500% due 03/25/2029 140 136 Crusade Global Trust 5.719% due 05/15/2021 (d) 13,119 13,152 Fannie Mae 8.495% due 07/01/2021 (d) 612 630 7.764% due 11/01/2022 (d) 800 827 7.583% due 01/01/2023 (d) 1,130 1,166 8.210% due 08/01/2023 (d) 921 947 Freddie Mac 6.000% due 03/15/2008 620 621 9.050% due 06/15/2019 51 54 8.266% due 06/01/2022 (d) 1,051 1,059 8.393% due 08/01/2022 (d) 607 622 General Electric Capital Mortgage Services, Inc. 6.250% due 07/25/2029 500 506 Government National Mortgage Association 7.625% due 11/20/2021 (d) 477 489 7.375% due 05/20/2022 (d) 45 46 7.750% due 07/20/2022 (d) 499 511 7.750% due 09/20/2022 (d) 314 322 7.375% due 05/20/2023 (d) 493 502 7.750% due 07/20/2023 (d) 533 545 7.750% due 07/20/2023 (d) 252 258 7.750% due 08/20/2023 (d) 238 244 7.750% due 09/20/2023 (d) 1,392 1,426 7.750% due 09/20/2023 (d) 621 636 7.125% due 10/20/2023 (d) 2,594 2,660 7.625% due 10/20/2024 (d) 212 217 7.375% due 04/20/2025 (d) 154 157 7.750% due 07/20/2025 (d) 3,312 3,391 7.750% due 09/20/2025 (d) 644 660 7.625% due 12/20/2025 (d) 250 257 7.750% due 09/20/2026 (d) 514 526 7.375% due 04/20/2027 (d) 1,271 1,290 6.000% due 04/15/2028-05/20/2030 (d)(g) 118,980 59,219 7.000% due 04/20/2030-05/20/2030 (d)(g) 10,384 5,840 6.500% due 04/23/2031 (d) 4,260 4,259 7.500% due 04/23/2031 12,600 12,915 Homeside Mortgage Securities Trust 5.929% due 01/20/2027 (d) 2,900 2,900 Medallion Trust 5.880% due 07/12/2031 (d) 4,844 4,846 Prudential Home Mortgage Securities 6.800% due 05/25/2024 480 464 Residential Funding Mortgage Securities, Inc. 6.500% due 05/25/2029 1,311 1,195 5.779% due 05/12/2032 (d) 12,805 12,821 Sasco Floating Rate Commercial Mortgage Trust 5.408% due 11/20/2001 (d) 1,900 1,901 Structured Asset Mortgage Investments, Inc. 6.581% due 06/25/2029 (d) 2,938 2,984 ------------- 151,800 ------------- Municipal Bonds & Notes 0.1% Massachusetts State Turnpike Authority Metro Highway System Revenue Bonds, (MBIA Insured), Series 1999 5.000% due 01/01/2037 1,000 941 ------------- Shares Preferred Security 1.0% DG Funding Trust 7.150% due 12/29/2049 (d) 640 6,528 ------------- 138 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- U.S. Government Agencies 2.7% Federal Home Loan Bank 5.805% due 02/15/2002 (d) $ 14,000 $ 14,066 Small Business Administration 6.640% due 02/10/2011 4,400 4,428 ------------- 18,494 ------------- Treasury Obligations 13.1% Treasury Inflation Protected Securities (h) 3.625% due 07/15/2002 (b)(i) 79,211 80,771 3.875% due 01/15/2009 2,348 2,442 3.625% due 04/15/2028 4,762 4,855 3.875% due 04/15/2029 213 228 ------------- 88,296 ------------- Total United States 421,150 (Cost $419,115) ------------- -------------------------------------------------------------------------------- PURCHASED CALL OPTION 0.0% -------------------------------------------------------------------------------- U.S. Treasury Bond (OTC) 5.500% due 02/15/2008 Strike @ 113.250 Exp. 25,000 0 06/01/2001 U.S. Treasury Note (OTC) 5.500% due 02/15/2008 Strike @ 112.19 Exp. 07/02/2001 215,000 15 U.S. Treasury Note Futures (CBOT) 6.000% due 06/30/2001 Strike @ 119.000 Exp. 05/26/2001 400 6 ------------- Total Purchased Call Options 21 (Cost $46) ------------- -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Republic of Germany (OTC) 4.500% due 07/04/2009 Strike @ 90.281 Exp. 05/02/2001 17,000 0 Republic of Germany (OTC) 5.250% due 01/04/2008 Strike @ 96.281 Exp. 05/02/2001 29,000 0 Republic of Germany (OTC) 5.250% due 01/04/2008 Strike @ 98.400 Exp. 05/02/2001 21,000 0 Republic of Germany (OTC) 5.250% due 01/04/2011 Strike @ 95.300 Exp. 05/02/2001 15,000 0 Republic of Germany (OTC) 6.000% due 07/04/2007 Strike @ 101.031 Exp. 05/02/2001 27,000 0 Republic of France (OTC) 4.000% due 10/25/2009 Strike @ 86.500 Exp. 05/02/2001 42,000 0 Government National Mortgage Association (OTC) 6.000% due 05/21/2031 Strike @ 90.281 Exp. 05/04/2001 145,000 0 Government National Mortgage Association (OTC) 7.500% due 05/21/2031 Strike @ 96.641 Exp. 05/04/2001 13,000 0 Interest Rate Swap (OTC) 7.500% due 05/01/2023 Strike @ 7.500 Exp. 04/29/2002 11,200 16 Japanese Government Bond (OTC) 10.800% due 06/20/2008 Strike @ 97.750 Exp. 05/02/2001 14,700,000 1 ------------- Total Purchased Put Options 17 (Cost $462) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 10.1% -------------------------------------------------------------------------------- Commercial Paper 9.2% Abbey National North America 5.040% due 08/06/2001 7,000 6,881 American Express Co. 5.320% due 04/04/2001 100 100 Becton Dickinson & Co. 4.800% due 07/25/2001 2,000 1,969 Coca-Cola Co. 4.600% due 07/12/2001 7,500 7,396 General Electric Capital Corp. 4.990% due 04/03/2001 1,800 1,800 4.980% due 04/25/2001 2,500 2,492 4.870% due 05/30/2001 10,000 9,918 4.600% due 07/18/2001 10,000 9,853 National Rural Utilities Cooperative Finance Corp. 4.880% due 05/25/2001 1,000 993 Reseau Ferre De France 4.590% due 07/25/2001 7,500 7,383 Swedbank, Inc. 5.150% due 04/25/2001 2,000 1,993 5.090% due 08/08/2001 4,000 3,931 UBS Finance, Inc. 5.340% due 04/04/2001 600 600 5.040% due 08/02/2001-08/15/2001 (g) 12,600 6,683 Verizon Global Funding 5.340% due 04/05/2001 300 300 ------------- 62,292 ------------- Repurchase Agreement 0.8% State Street Bank 4.600% due 04/02/2001 5,365 5,365 (Dated 03/30/2001. Collateralized by ------------- Freddie Mac 7.000% due 03/15/2010 valued at $5,476. Repurchase proceeds are $5,367.) U.S. Treasury Bills 0.1% 4.600% due 05/17/2001 (b) 585 581 ------------- Total Short-Term Instruments 68,238 (Cost $68,255) ------------- Total Investments (a) 154.2% $ 1,040,636 (Cost $1,061,915) Written Options (c) (0.3%) (2,046) (Premiums $696) Other Assets and Liabilities (363,749) (Net) (53.9%) ------------- Net Assets 100.0% $ 674,841 ------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,062,222 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 8,890 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (30,477) ------------- Unrealized depreciation-net $ (21,586) ------------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 139 Schedule of Investments (Cont.) Foreign Bond Fund March 31, 2001 (b) Securities with an aggregate market value of $7,367 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) ------------------------------------------------------------------------------ U.S. Treasury 10 Year Note 2,127 $ (502) (06/2001) EuroBond 10 Year Note (06/2001) 199 183 Government of Japan 10 Year 162 174 Note (06/2001) UK GILT LIF (06/2001) 15 (9) ------------- $ (154) ------------- (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - CME Eurodollar December Futures Strike @ 95.00 Exp. 12/17/2001 34 $ 14 $ 10 Call - CBOT U.S. Treasury Note June Futures Strike @ 107.00 Exp. 05/26/2001 35 22 30 Put - CME Eurodollar December Futures Strike @ 95.25 Exp. 12/17/2001 206 103 113 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 243 133 133 Put - OTC 3 Month LIBOR Interest Rate Swap Strike @ 7.50 Exp. 04/29/2002 16,000,000 362 1,689 Put - CBOT U.S. Treasury Note June Futures Strike @ 105.00 Exp. 05/26/2001 125 62 71 ----------------------------- $ 696 $ 2,046 ----------------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) ------------------------------------------------------------------------------- Buy A$ 1,600 04/2001 $ (106) Sell 2,584 04/2001 79 Buy C$ 5,813 04/2001 (32) Sell 11,560 04/2001 145 Sell SF 43,161 05/2001 208 Buy CP 349,600 04/2001 (26) Sell 349,600 04/2001 18 Sell DK 54,194 05/2001 344 Buy EC 161,227 04/2001 (1,425) Sell 146,971 04/2001 7,780 Sell 135,290 06/2001 510 Sell BP 10,726 05/2001 522 Sell H$ 121,000 05/2001 40 Buy 111,900 08/2001 (49) Sell 223,800 08/2001 172 Buy HF 341,600 08/2001 (29) Buy JY 5,209,915 04/2001 (1,027) Sell 5,209,915 04/2001 2,255 Sell 5,960,790 06/2001 1,136 Buy KW 1,262,100 04/2001 (159) Sell 1,262,100 04/2001 38 Sell N$ 21,385 04/2001 370 Buy PZ 28,050 04/2001 1,181 Sell 28,050 04/2001 (245) Sell SK 57,435 05/2001 361 Buy TB 28,140 04/2001 (23) Sell 28,140 04/2001 28 Buy TD 21,403 04/2001 (7) Sell 21,403 04/2001 (2) ------------ $ 12,057 ------------ (f) Principal amount denoted in indicated currency: A$ - Australian Dollar BF - Belgian Franc BP - British Pound C$ - Canadian Dollar CP - Chilean Peso DK - Danish Krone DM - Germany Mark EC - Euro GD - Greek Drachma H$ - Hong Kong Dollar HF - Hungarian Forint JY - Japanese Yen KW - Korean Won N$ - New Zealand Dollar PZ - Polish Zloty SF - Swiss Franc SK - Swedish Krona TB - Thai Baht TD - Taiwan Dollar (g) Securities are grouped together by coupon or range of coupons and represent a range of maturities. (h) Principal amount of the security is adjusted for inflation. (i) Subject to financing transaction. (j) Security is in default. (k) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive fixed rate equal to 6.949% and pay floating rate based on 6-month BP-LIBOR. Broker: Merrill Lynch Exp. 08/06/2003 BP 4,500 $ 240 Receive floating rate based on 6-month Australian Bank Bill and pay interest rate swap equal to 5.217% Broker: Morgan Stanley Exp. 03/15/2006 A$ 36,800 171 Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.248%. Broker: Royal Bank of Canada Exp. 08/02/2005 C$ 60,600 (1,492) Receive floating rate based on 3-Month H$-HIBOR and pay fixed rate equal to 6.910%.need to review the docs. Broker: Goldman Sachs Exp. 02/15/2006 H$ 293,000 (1,988) Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.515%. Broker: J.P. Morgan Exp. 05/10/2002 C$ 24,330 (302) 140 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 6-month JY-LIBOR and pay fixed rate equal to 2.020%. Broker: Goldman Sachs Exp. 05/18/2010 JY 1,776,00 $ (961) Receive fixed rate equal to 6.790% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 02/15/2006 $ 37,200 2,190 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2006 83,700 1,985 Receive fixed rate equal to 5.683% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Exp. 01/08/2004 BP 33,800 509 Receive floating rate based on 3-Month H$-HIBOR and pay fixed rate equal to 5.906%. Broker: Goldman Sachs Exp. 07/11/2006 H$ 419,000 (270) Receive fixed rate equal to 5.710% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 07/11/2006 $ 53,700 528 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2011 46,400 589 Receive fixed rate equal to 5.900% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 01/26/2004 BP 26,400 439 Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.410% Broker: Morgan Stanley Exp. 09/01/2002 11,000 (41) Receive fixed rate equal to 5.513% and pay floating rate based on 6-month BP-LIBOR Broker: Morgan Stanley Exp. 03/01/2004 11,000 99 Receive fixed rate equal to 6.343% and pay floating rate based on 6-month EURO-LIBOR Broker: Lehman Brothers Exp. 03/08/2016 EC 47,500 (25) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.465% Broker: Lehman Brothers Exp. 03/07/2016 BP 30,200 $ 49 Receive fixed rate equal to 6.273% and pay floating rate based on 6-month EURO-LIBOR Broker: Morgan Stanley Exp. 03/13/2016 EC 32,960 (68) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.778% Broker: Morgan Stanley Exp. 03/13/2016 BP 20,600 (50) Receive fixed rate equal to 5.471% and pay floating rate based on 6-month BP-LIBOR Broker: Goldman Sachs Exp. 03/15/2006 24,700 206 Receive fixed rate equal to 5.440% and pay floating rate based on 3-month LIBOR Broker: Goldman Sachs Exp. 03/19/2006 $ 9,500 13 Receive floating rate based on 3-month H$-HIBOR and pay fixed rate equal to 5.550%. Broker: Goldman Sachs Exp. 03/16/2006 H$ 73,800 51 Receive fixed rate equal to 5.467% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 03/15/2006 $ 18,400 1 Receive fixed rate equal to 5.225% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/19/2003 BP 53,370 27 Receive fixed rate equal to 5.133% and pay floating rate based on 3-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/19/2003 145,900 (136) ------------ $ 1,764 ------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 141 Schedule of Investments Global Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- AUSTRALIA (e)(f) 1.4% -------------------------------------------------------------------------------- General Motors Acceptance Corp. 4.849% due 03/25/2002 (d) EC 1,000 $ 879 Registered Australian Mortgage Securities 5.138% due 09/26/2032 (d) 621 546 Superannuation Members Home Loans Global Fund 6.835% due 06/15/2026 (d) $ 1,600 1,600 Torrens Trust 5.424% due 07/15/2031 (d) 1,388 1,388 ------------- Total Australia 4,413 (Cost $4,535) ------------- -------------------------------------------------------------------------------- AUSTRIA (e)(f) 0.2% -------------------------------------------------------------------------------- Republic of Austria 5.500% due 01/15/2010 EC 600 547 ------------- Total Austria 547 (Cost $521) ------------- -------------------------------------------------------------------------------- BELGIUM (e)(f) 1.3% -------------------------------------------------------------------------------- Kingdom of Belgium 6.750% due 11/21/2004 (d) BF 95,900 2,246 7.500% due 07/29/2008 (i) EC 900 915 5.000% due 09/28/2011 (i) 1,000 873 ------------- Total Belgium 4,034 (Cost $5,047) ------------- -------------------------------------------------------------------------------- BRAZIL 1.3% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (d) $ 4,286 3,885 ------------- Total Brazil 3,885 (Cost $3,988) ------------- -------------------------------------------------------------------------------- CANADA (e)(f) 8.2% -------------------------------------------------------------------------------- Beneficial Canada, Inc. 6.350% due 04/01/2002 C$ 1,460 938 Commonwealth of Canada 6.000% due 09/01/2005 (i) 16,000 10,510 7.000% due 12/01/2006 (i) 7,900 5,444 7.250% due 06/01/2007 (i) 11,000 7,700 5.500% due 06/01/2010 1,100 702 ------------- Total Canada 25,294 (Cost $25,982) ------------- -------------------------------------------------------------------------------- CAYMAN ISLANDS (e)(f) 1.2% -------------------------------------------------------------------------------- Geldilux Ltd. 4.931% due 02/12/2002 EC 3,500 3,080 International Credit Recovery-Japan 0.746% due 08/25/2005 JY 20,000 159 0.863% due 08/25/2005 63,422 505 ------------- Total Cayman Islands 3,744 (Cost $3,795) -------------------------------------------------------------------------------- DENMARK (e)(f) 1.3% -------------------------------------------------------------------------------- Lb Rheinland - PFALZ 4.750% due 04/04/2008 EC 2,130 1,852 Nykredit 6.000% due 10/01/2009 DK 14,921 1,706 Unikredit Realkredit 6.000% due 07/01/2029 3,488 400 ------------- Total Denmark 3,958 (Cost $3,863) ------------- -------------------------------------------------------------------------------- FRANCE (e)(f) 7.9% -------------------------------------------------------------------------------- Axa 2.500% due 01/01/2014 EC 405 353 Republic of France 5.500% due 04/25/2007 6,170 5,725 4.000% due 04/25/2009 (i) 2,260 1,897 3.000% due 07/25/2009 1,862 1,588 4.000% due 10/25/2009 (i) 16,080 13,301 5.500% due 04/25/2010 1,920 1,776 ------------- Total France 24,640 (Cost $24,761) ------------- -------------------------------------------------------------------------------- GERMANY (e)(f) 14.4% -------------------------------------------------------------------------------- Commerzbank AG 5.206% due 10/25/2032 (d) EC 3,700 3,264 Depfa Pfandbriefbank 4.750% due 07/15/2008 860 744 5.750% due 03/04/2009 (i) 860 790 DT Hypothekenbank 3.500% due 07/03/2006 4,000 3,320 Hypothekenbank in Essen AG 5.500% due 02/20/2007 (i) 1,350 1,223 Landesbank Baden-Wuerttemberg AG 5.500% due 04/02/2007 1,720 1,563 Republic of Germany 6.000% due 07/04/2007 (i) 7,280 6,922 5.250% due 01/04/2008 (i) 7,700 7,069 4.125% due 07/04/2008 (i) 18,550 15,852 4.000% due 07/04/2009 (i) 900 757 6.250% due 01/04/2030 (i) 900 893 Rheinische Hypothekenbank AG 4.250% due 09/24/2008 1,750 1,461 WestDeutsche Landersbank 4.750% due 09/28/2007 860 750 ------------- Total Germany 44,608 (Cost $44,125) ------------- -------------------------------------------------------------------------------- GREECE (e)(f) 0.8% -------------------------------------------------------------------------------- Hellenic Finance 2.000% due 07/15/2003 EC 500 440 Hellenic Republic 7.850% due 05/19/2003 (d) 440 399 7.890% due 06/17/2003 (d) 346 315 7.080% due 10/23/2003 (d) 1,595 1,471 ------------- Total Greece 2,625 (Cost $3,339) ------------- -------------------------------------------------------------------------------- ITALY (e)(f) 14.6% -------------------------------------------------------------------------------- Finmeccanica SpA 2.000% due 06/08/2005 EC 1,538 1,312 First Italian Auto Transaction 5.139% due 07/01/2008 (d) 3,900 3,432 International Credit Recovery 5.602% due 03/15/2010 800 704 Island Finance 5.404% due 01/15/2015 (d) 1,653 1,461 Republic of Italy 5.750% due 09/15/2002 (i) 7,200 6,458 4.750% due 07/01/2005 6,690 5,924 7.750% due 11/01/2006 (i) 3,100 3,120 4.500% due 05/01/2009 (i) 21,800 18,565 4.250% due 11/01/2009 2,470 2,061 5.500% due 11/01/2010 (i) 2,350 2,130 ------------- Total Italy 45,167 (Cost $45,890) ------------- 142 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- JAPAN (e)(f) 3.4% -------------------------------------------------------------------------------- Government of Japan 3.400% due 06/20/2005 (i) JY 15,500 $ 137 4.000% due 06/20/2005 (i) 32,700 296 2.900% due 12/20/2006 (i) 115,000 1,019 0.900% due 12/22/2008 (d)(i) 1,066,900 8,442 SHL Corp. Ltd. 1.031% due 12/25/2024 (d) 37,204 296 1.331% due 12/25/2024 (d) 41,000 327 ------------- Total Japan 10,517 (Cost $11,656) ------------- -------------------------------------------------------------------------------- MEXICO (e)(f) 1.2% -------------------------------------------------------------------------------- Petroleos Mexicanos 8.850% due 09/15/2007 $ 480 494 9.375% due 12/02/2008 650 678 United Mexican States 8.750% due 05/30/2002 BP 150 216 10.375% due 01/29/2003 DM 3,654 1,751 4.000% due 03/11/2004 JY 73,000 596 ------------- Total Mexico 3,735 (Cost $4,121) ------------- -------------------------------------------------------------------------------- NETHERLANDS (e)(f) 0.7% -------------------------------------------------------------------------------- Unilever NV 4.830% due 09/17/2001 (d) EC 2,500 2,189 ------------- Total Netherlands 2,189 (Cost $2,134) ------------- -------------------------------------------------------------------------------- NEW ZEALAND (e)(f) 1.9% -------------------------------------------------------------------------------- Commonwealth of New Zealand 5.500% due 04/15/2003 N$ 1,900 763 4.500% due 02/15/2016 11,421 5,061 ------------- Total New Zealand 5,824 (Cost $7,012) ------------- -------------------------------------------------------------------------------- PERU 0.4% -------------------------------------------------------------------------------- Republic of Peru 4.500% due 03/07/2017 (d) $ 1,700 1,160 ------------- Total Peru 1,160 (Cost $1,180) ------------- -------------------------------------------------------------------------------- SOUTH KOREA (e)(f) 2.7% -------------------------------------------------------------------------------- Export-Import Bank Korea 7.250% due 06/25/2001 $ 1,810 1,814 6.500% due 02/10/2002 500 500 KBC Bank Fund Trust IV 8.220% due 11/29/2049 EC 500 463 Korea Development Bank 4.885% due 05/14/2001 DM 520 234 2.770% due 05/21/2001 JY 100,000 799 2.450% due 09/10/2001 194,000 1,552 1.875% due 02/13/2002 380,000 3,039 ------------- Total South Korea 8,401 (Cost $8,784) ------------- -------------------------------------------------------------------------------- SPAIN (e)(f) 4.1% -------------------------------------------------------------------------------- Kingdom of Spain 4.950% due 07/30/2005 (i) EC 6,480 5,793 5.150% due 07/30/2009 (i) 6,830 6,117 4.000% due 01/31/2010 (i) 980 805 ------------- Total Spain 12,715 (Cost $12,649) ------------- -------------------------------------------------------------------------------- SUPRANATIONAL (e)(f) 1.0% -------------------------------------------------------------------------------- Asian Development Bank 5.375% due 09/15/2003 A$ 2,300 $ 1,133 Eurofima 4.750% due 07/07/2004 SK 4,700 454 International Bank for Reconstruction & Development 7.250% due 04/09/2001 N$ 4,000 1,613 ------------- Total Supranational 3,200 (Cost $3,974) ------------- -------------------------------------------------------------------------------- SWEDEN (e)(f) 1.0% -------------------------------------------------------------------------------- Kingdom of Sweden 13.000% due 06/15/2001 SK 10,300 1,009 5.000% due 01/28/2009 20,200 2,002 ------------- Total Sweden 3,011 (Cost $3,377) ------------- -------------------------------------------------------------------------------- UNITED KINGDOM (e)(f) 9.9% -------------------------------------------------------------------------------- Abbey National Treasury Service PLC 7.625% due 12/30/2002 BP 250 367 5.250% due 01/21/2004 150 212 BG Transco Holdings PLC 7.057% due 12/14/2009 (d) 1,060 1,499 British Telecommunications PLC 6.079% due 12/15/2003 (d) $ 2,600 2,601 Core 4.903% due 01/16/2006 (d)(k) DM 4,409 1,961 Equitable 8.000% due 08/29/2049 BP 2,100 1,579 Halifax Group Euro Finance 7.627% due 12/29/2049 EC 500 464 Haus Ltd. 4.886% due 12/10/2015 (d) 623 548 5.124% due 12/10/2037 (d) 4,200 3,697 Holmes Financing PLC 5.859% due 07/15/2017 (d) $ 3,200 3,201 5.166% due 12/15/2025 (d) EC 3,134 2,757 Lloyds TSB Bank PLC 5.625% due 07/15/2049 2,410 2,011 Royal Bank of Scotland Group PLC 6.770% due 03/31/2049 2,200 2,022 SCCR Series 1 Ltd. 5.373% due 12/15/2031 (d) BP 1,532 1,351 United Kingdom Gilt 7.500% due 12/07/2006 (i) 1,850 2,959 7.250% due 12/07/2007 (i) 1,850 2,972 Vodafone Group PLC 6.736% due 12/19/2001 (d) 500 501 Westlb Finance Curacao NV 8.500% due 06/02/2003 110 165 ------------- Total United Kingdom 30,867 (Cost $34,073) ------------- -------------------------------------------------------------------------------- UNITED STATES (e)(f) 82.7% -------------------------------------------------------------------------------- Asset-Backed Securities 10.5% AFC Home Equity Loan Trust 5.360% due 12/22/2027 (d) $ 616 616 5.350% due 07/25/2030 (d) 3,759 3,766 Americredit Automobile Receivable Trust 5.880% due 12/05/2003 161 162 Amresco Residential Securities Mortgage Loan Trust 6.000% due 06/25/2029 (d) 2,703 2,714 Argentina Funding Corp. 5.840% due 05/20/2003 (d) 300 301 Banc One Auto Grantor Trust 6.270% due 11/20/2003 86 86 6.290% due 07/20/2004 161 162 Bayview Financial Acquisition Trust 5.920% due 11/25/2030 (d) 3,200 3,200 Chase Manhattan Grantor Trust 6.610% due 09/15/2002 30 30 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 143 Schedule of Investments (Cont.) Global Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Conseco Finance 5.534% due 10/15/2031 (d) $ 905 $ 908 CS First Boston Mortgage Securities Corp. 5.424% due 12/15/2030 (d) 3,074 3,077 GMAC Mortgage Corp. Loan Trust 5.256% due 11/18/2015 (d) 1,690 1,691 Nissan Auto Receivables Grantor Trust 5.450% due 04/15/2004 505 506 Novastar Home Equity Loan 5.325% due 04/25/2028 (d) 2,099 2,074 Provident Bank Equipment Lease Trust 5.830% due 11/25/2011 (d) 866 866 Providian Gateway Master Trust 5.380% due 03/15/2007 (d) 3,000 3,000 Providian Home Equity Loan Trust 5.340% due 06/25/2025 (d) 318 319 PSB Lending Home Loan Owner Trust 6.830% due 05/20/2018 150 151 Residential Asset Securities Corp. 5.854% due 12/25/2013 (d) 1 1 Residential Funding Mortgage Securities, Inc. 10.836% due 06/01/2001 (d) 5,800 5,800 SallieMae 5.936% due 04/25/2004 (d) 138 138 5.979% due 10/25/2004 (d) 82 82 Salomon Brothers Mortgage Securities VII 5.310% due 02/25/2031 (d) 2,745 2,745 USAA Auto Loan Grantor Trust 5.800% due 01/15/2005 284 285 ------------ 32,680 ------------ Corporate Bonds & Notes 17.0% Abbey National Capital Trust I 8.963% due 12/29/2049 (d) 1,000 1,109 Allegheny Energy Supply 6.325% due 05/01/2002 (d) 1,400 1,401 Alpha Wind 11.321% due 05/23/2001 (d) 1,000 1,000 Associates Corp. of North America 5.400% due 08/27/2001 (d) 200 201 4.949% due 06/30/2003 (d) EC 800 707 Associates First Capital Corp. 5.810% due 01/25/2031 (d) $ 2,941 2,941 AT&T Capital Corp. 5.881% due 04/23/2002 (d) 1,800 1,804 Bancomext Trust Division 8.000% due 08/05/2003 180 183 Bear Stearns Co., Inc. 5.210% due 03/28/2003 (d) 1,390 1,390 Beckman Instruments, Inc. 7.100% due 03/04/2003 138 139 Capital One Bank 6.308% due 07/28/2003 (d) 500 492 CMS Energy Corp. 8.125% due 05/15/2002 164 166 DaimlerChrysler North America Holding Corp. 5.640% due 08/23/2002 (d) 960 952 DQE Capital Corp. 6.179% due 01/15/2002 (d) 400 400 Finova Capital Corp. 6.040% due 11/08/2002 (d)(l) 1,920 1,576 6.316% due 04/08/2003 (d)(l) 1,100 902 Ford Motor Credit Co. 1.000% due 12/22/2003 JY 55,000 439 6.089% due 07/19/2004 (d) $ 300 298 1.200% due 02/07/2005 JY 326,000 2,594 6.179% due 07/18/2005 (d) $ 2,400 2,362 Fuji Bank Ltd. 9.870% due 12/29/2049 (d) 100 83 General Motors Acceptance Corp. 9.000% due 10/15/2002 1,140 1,198 6.536% due 04/05/2004 (d) 1,200 1,183 6.875% due 09/09/2004 BP 730 1,056 5.000% due 01/18/2005 EC 800 685 5.500% due 02/02/2005 2,500 2,210 Gold Eagle Capital Ltd. 11.079% due 04/15/2001 (d) 1,500 1,500 Household Finance Corp. 5.773% due 08/06/2002 (d) 850 852 International Game Technology 7.875% due 05/15/2004 1,800 1,828 J.P. Morgan & Co., Inc. 6.655% due 02/15/2012 (d) 760 694 Jones Intercable, Inc. 8.875% due 04/01/2007 164 176 Lehman Brothers Holdings, Inc. 6.479% due 07/15/2002 (d) 500 503 Merrill Lynch & Co. 5.605% due 11/01/2001 (d) 700 701 MGM Grand, Inc. 6.950% due 02/01/2005 80 80 Morgan Stanley, Dean Witter & Co. 5.723% due 01/28/2002 (d) 1,000 1,002 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(l) 1,500 1,238 Protective Life Funding Trust 6.089% due 01/17/2003 (d) 600 601 Rollins Truck Leasing Co. 8.250% due 05/01/2002 1,000 1,027 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 8,829 8,877 6.204% due 10/21/2002 (d) BP 90 128 Sprint Capital Corp. 5.875% due 05/01/2004 $ 280 275 TCI Communications, Inc. 5.555% due 04/01/2002 (d) 2,600 2,585 Texas Utilities Electric Co. 5.650% due 12/20/2002 (d) 2,200 2,201 WorldCom, Inc. 7.375% due 01/15/2003 1,000 1,012 ------------ 52,751 ------------ Mortgage-Backed Securities 29.1% Chase Mortgage Finance Corp. 6.550% due 08/25/2028 1,260 1,271 Citicorp Mortgage Securities, Inc. 6.500% due 07/25/2028 2,477 2,491 6.500% due 03/25/2029 60 58 Crusade Global Trust 5.719% due 05/15/2021 (d) 6,377 6,393 Fannie Mae 7.500% due 11/01/2001 62 63 7.500% due 01/01/2002 194 196 7.000% due 01/01/2005 643 654 6.500% due 04/01/2009 356 364 15.750% due 12/01/2011 5 6 13.000% due 09/01/2013 20 24 9.000% due 04/01/2016 207 220 8.515% due 11/01/2023 (d) 174 180 8.079% due 03/01/2024 (d) 104 107 Federal Housing Administration 7.400% due 02/01/2021 1,175 1,169 7.430% due 06/01/2021 262 266 7.430% due 01/01/2024 248 247 Freddie Mac 6.000% due 03/15/2008 413 414 8.227% due 05/01/2023 (d) 374 381 General Electric Capital Mortgage Services, Inc. 6.250% due 07/25/2029 450 455 Government National Mortgage Association 13.500% due 02/15/2011 10 12 7.375% due 05/20/2022 (d) 22 23 7.750% due 07/20/2022 (d) 237 243 7.750% due 09/20/2022 (d) 344 352 7.750% due 09/20/2022 (d) 143 147 7.375% due 05/20/2023 (d) 291 297 7.375% due 06/20/2023 (d) 228 232 7.750% due 07/20/2023 (d) 295 302 7.750% due 07/20/2023 (d) 243 249 144 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 7.750% due 09/20/2023 (d) $ 180 $ 184 7.750% due 09/20/2023 (d) 497 509 7.625% due 12/20/2023 (d) 290 297 7.625% due 10/20/2024 (d) 185 190 7.625% due 12/20/2025 (d) 125 128 7.750% due 09/20/2026 (d) 206 210 7.625% due 11/20/2026 (d) 343 352 7.625% due 12/20/2026 (d) 414 424 6.000% due 04/15/2028-05/20/2030 (d)(j) 60,318 30,023 5.750% due 02/16/2030 (d) 4,313 4,320 7.000% due 04/20/2030-05/20/2030 (d)(j) 3,709 2,194 7.500% due 04/23/2031 26,900 27,573 Homeside Mortgage Securities Trust 5.929% due 01/20/2027 (d) 1,500 1,500 Independent National Mortgage Corp. 8.225% due 07/25/2025 (d) 273 275 J.P. Morgan Commercial Mortgage Finance Corp. 5.444% due 04/15/2010 (d) 486 486 Medallion Trust 5.880% due 07/12/2031 (d) 493 493 Residential Funding Mortgage Securities I 8.953% due 03/25/2025 (d) 450 467 Sasco Floating Rate Commercial Mortgage Trust 5.408% due 11/20/2001 (d) 1,085 1,086 Small Business Investment Cos. 7.640% due 03/10/2010 990 1,054 Structured Asset Mortgage Investments, Inc. 6.581% due 06/25/2029 (d) 1,540 1,565 Washington Mutual, Inc. 5.690% due 07/26/2003 (d) 213 213 ------------ 90,359 ------------ Municipal Bonds & Notes 0.4% California State General Obligation Bonds, Series 2000 6.400% due 12/01/2028 400 347 Chicago, Illinois General Obligations, (FGIC Insured), Series 2000 6.400% due 01/01/2029 125 118 Los Angeles, California Wastewater System Revenue Bonds, (FGIC Insured), Series 2000 6.700% due 06/01/2028 140 136 Massachusetts Bay Transportation Authority, (MBIA Insured), Series 1998 4.750% due 03/01/2021 500 473 ------------ 1,074 ------------ U.S. Government Agencies 9.6% Freddie Mac 6.450% due 04/29/2009 (i) 27,400 27,533 Small Business Administration 6.640% due 02/10/2011 2,300 2,315 ------------ 29,848 ------------ U.S. Treasury Obligations 15.4% Treasury Inflation Protected Securities (h) 3.625% due 07/15/2002 (b)(i) 44,054 44,921 3.625% due 04/15/2028 541 552 3.875% due 04/15/2029 (i) 2,129 2,273 ------------ 47,746 ------------ Shares Preferred Security 0.4% DG Funding Trust 7.150% due 12/29/2049 (d) 130 1,326 Preferred Stock 0.3% Pinto Totta International Finance 7.770% due 12/29/2049 1,000 989 ------------ Total United States 256,773 (Cost $254,642) ------------ -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 0.0% -------------------------------------------------------------------------------- U.S. Treasury Bond (OTC) 5.500% due 02/15/2008 Strike @ 113.250 Exp. 06/01/2001 $ 90,000 $ 0 U.S. Treasury Bond (OTC) 9.250% due 02/15/2016 Strike @ 156.00 Exp. 7/02/2001 17,000 2 U.S. Treasury Note (OTC) 5.500% due 02/15/2008 Strike @ 112.19 Exp. 07/02/2001 85,000 6 ------------ Total Purchased Call Options 8 (Cost $30) ------------ -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS (e)(f) 0.0% -------------------------------------------------------------------------------- Government National Mortgage Association (OTC) 6.000% due 05/21/2031 Strike @ 90.281 Exp. 05/04/2001 $ 95,000 0 Government National Mortgage Association (OTC) 7.500% due 05/21/2031 Strike @ 96.641 Exp. 05/04/2001 27,000 0 Interest Rate Swap (OTC) 7.500% due 05/01/2023 Strike @ 7.500 Exp. 04/29/2002 4,900 8 Japanese Government Bond (OTC) 1.800% due 06/20/2008 Strike @ 97.750 Exp. 05/02/2001 8,800,000 1 Japanese Yen vs. Eurodollar (OTC) 0.900% due 05/04/2001 Strike @ 88.788 Exp. 12/31/2008 JY 7,000,000 1 Republic of Germany (OTC) 6.500% due 07/04/2027 Strike @ 101.100 Exp. 05/02/2001 $ 2,000 0 ------------ Total Purchased Put Options 10 (Cost $208) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 4.1% -------------------------------------------------------------------------------- Commercial Paper 3.3% General Electric Capital Corp. 4.980% due 04/25/2001 2,000 1,994 4.690% due 05/30/2001 300 298 Swedbank, Inc. 4.860% due 05/30/2001 4,000 3,967 UBS Finance, Inc. 4.670% due 06/13/2001 4,000 3,961 ------------ 10,220 ------------ Repurchase Agreement 0.8% State Street Bank 4.600% due 04/02/2001 2,514 2,514 (Dated 03/30/2001. Collateralized by Freddie Mac 6.680% due 12/28/2001 valued at $2,565. Repurchase proceeds are $2,515.) ------------ Total Short-Term Instruments 12,734 (Cost $12,739) ------------ Total Investments (a) 165.7% $ 514,059 (Cost $522,425) Written Options (c) (0.3%) (922) (Premiums $328) Other Assets and Liabilities (202,939) (Net) (65.4%) ------------ Net Assets 100.0% $ 310,198 ------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 145 Schedule of Investments (Cont.) Global Bond Fund March 31, 2001 -------------------------------------------------------------------------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $522,804 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 6,303 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (15,048) ----------- Unrealized depreciation-net $ (8,745) ----------- (b) Securities with an aggregate market value of $3,224 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contract (Depreciation) -------------------------------------------------------------------------------- EuroBond 10 Year Note (06/2001) 123 $ 107 Municipal Bond (06/2001) 1 (1) Government of Japan 5 Year Note (06/2001) 1 1 Government of Japan 10 Year Note (06/2001) 54 59 United Kingdom Gilt (06/2001) 10 (7) U.S. Treasury 10 Year Note (06/2001) 843 (78) U.S. Treasury 30 Year Bond (06/2001) 158 72 ----------- $ 153 ------------ (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - CME Eurodollar December Futures Strike @ 95.00 Exp. 12/17/01 16 $ 7 $ 5 Call - CBOT U.S. Treasury Note June Futures Strike @ 107.00 Exp. 05/26/2001 15 10 13 Put - CME Eurodollar December Futures Strike @ 95.25 Exp. 12/17/2001 94 62 70 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 114 62 62 Put - OTC 3 Month LIBOR Interest Rate Swap Strike @ 7.50 Exp. 04/29/2002 7,000,000 158 739 Put - CBOT U.S. Treasury Note June Futures Strike @ 105.00 Exp. 05/26/2001 59 29 33 ------------------------ $ 328 $ 922 ------------------------ (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy A$ 4,993 04/2001 $ (332) Sell 3,701 04/2001 186 Buy C$ 12,407 04/2001 (134) Sell SF 22,582 05/2001 109 Buy CL 197,800 04/2001 (15) Sell 197,800 04/2001 10 Buy DK 9,905 05/2001 (63) Buy EC 41,213 04/2001 (2,024) Sell 36,538 04/2001 189 Buy 34,938 06/2001 (132) Buy BP 10,520 05/2001 (408) Sell H$ 71,000 05/2001 23 Buy 53,800 08/2001 (24) Sell 107,700 08/2001 83 Buy HF 198,700 08/2001 (17) Buy JY 8,603,214 04/2001 (3,857) Sell 8,633,336 04/2001 1841 Buy 7,501,943 06/2001 (1512) Sell 345,000 06/2001 42 Buy KW 662,500 04/2001 (83) Sell 662,500 04/2001 20 Sell N$ 21,501 04/2001 372 Buy PZ 13,050 04/2001 549 Sell 13,050 04/2001 (114) Sell SK 3,499 05/2001 22 Buy TB 13,700 04/2001 (11) Sell 13,700 04/2001 9 Buy TD 11,241 04/2001 (4) Sell 11,241 04/2001 3 ----------- $ (5,272) ----------- (f) Principal amount denoted in indicated currency: A$ - Australian Dollar BF - Belgian Franc BP - British Pound C$ - Canadian Dollar CL - Chilean Peso DK - Danish Krone DM - German Mark EC - Euro H$ - Hong Kong Dollar HF - Hungarian Forint JY - Japanese Yen KW - South Korean Won N$ - New Zealand Dollar PZ - Polish Zloty SF - Swiss Franc SK - Swedish Krona TB - Thai Baht TD - Taiwan Dollar (g) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive fixed rate equal to 5.935% and pay floating rate based on 6-month BP-LIBOR. Broker: Merrill Lynch Exp. 11/05/2003 BP 7,300 $ 171 Receive floating rate based on 6-month Australian Bank Bill and pay fixed rate equal to 5.217% Broker: Morgan Stanley Exp. 03/15/2006 A$ 15,350 71 Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.248%. Broker: Royal Bank of Canada Exp. 08/02/2005 C$ 29,700 (731) Receive floating rate based on 3-month H$ HIBOR and pay fixed rate equal to 6.910%. Broker: Goldman Sachs Exp. 02/15/2006 H$ 157,000 (1,065) Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.515%. Broker: J.P. Morgan Exp. 05/10/2002 C$ 11,910 (148) 146 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.035%. Broker: Goldman Sachs Exp. 05/18/2010 JY 1,160,000 $ (640) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.310%. Broker: Goldman Sachs Exp. 07/14/2005 693,000 (185) Receive a fixed rate equal to 6.790% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 02/15/2006 $ 19,900 1,172 Receive a fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2006 66,000 1,565 Receive a fixed rate equal to 5.683% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Exp. 01/08/2004 BP 18,900 285 Receive floating rate based on 3-month H$-HIBOR and pay a fixed rate equal to 5.906%. Broker: Goldman Sachs Exp. 07/11/2006 H$ 221,000 (142) Receive a fixed rate equal to 5.710% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 07/11/2006 $ 28,300 278 Receive a fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2011 32,200 409 Receive a fixed rate equal to 5.900% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 01/26/2004 BP 7,500 124 Receive floating rate based on 6-month BP-LIBOR and pay a fixed rate equal to 5.410% Broker: Morgan Stanley Exp. 09/01/2002 5,400 (20) Receive a fixed rate equal to 5.513% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Exp. 03/01/2004 5,400 49 Receive a fixed rate equal to 6.342% and pay floating rate based on 6-month Euro-LIBOR. Broker: Lehman Brothers Exp. 03/08/2016 EC 23,600 (12) Receive floating rate based on 6-month BP-LIBOR and pay a fixed rate equal to 5.465% Broker: Lehman Brothers Exp. 03/07/2016 BP 15,000 $ 25 Receive a fixed rate equal to 6.273% and pay floating rate based on 6-month Euro-LIBOR. Broker: Morgan Stanley Exp. 03/13/2016 EC 16,380 (34) Receive floating rate based on 6-month BP-LIBOR and pay a fixed rate equal to 5.578% Broker: Lehman Brothers Exp. 03/13/2016 BP 10,240 (25) Receive a fixed rate equal to 5.471% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/15/2006 17,100 142 Receive a fixed rate equal to 5.440% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 03/19/2006 $ 800 1 Receive floating rate based on 3-month H$-HIBOR and pay a fixed rate equal to 5.550% Broker: Goldman Sachs Exp. 03/16/2006 H$ 6,000 4 Receive a fixed rate equal to 5.467% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 03/15/2006 $ 7,650 0 Receive a fixed rate equal to 5.133% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 03/19/2003 BP 76,200 (71) ------------ $ 1,223 ------------ (h) Principal amount of the security is adjusted for inflation. (i) Subject to financing transaction. (j) Securities are grouped by coupon or a range of coupons and represent a range of maturities. (k) Restricted security. (l) Security is in default. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 147 Schedule of Investments Global Bond Fund II March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- AUSTRALIA (f)(g) 2.9% -------------------------------------------------------------------------------- General Motors Acceptance Corp. 4.849% due 03/25/2002 (d) EC 1,200 $ 1,053 Registered Australian Mortgage Securities 5.138% due 09/26/2032 (d) 399 351 Superannuation Members Home Loans Global Fund 6.835% due 06/15/2026 (d) $ 400 400 Torrens Trust 5.424% due 07/15/2031 (d) 408 408 ----------- Total Australia 2,212 (Cost $2,335) ----------- -------------------------------------------------------------------------------- AUSTRIA (f)(g) 0.7% -------------------------------------------------------------------------------- Republic of Austria 5.500% due 01/15/2010 EC 600 547 ----------- Total Austria 547 (Cost $512) ----------- -------------------------------------------------------------------------------- BELGIUM (f)(g) 1.7% -------------------------------------------------------------------------------- Kingdom of Belgium 6.750% due 11/21/2004 (d) BF 5,800 136 7.500% due 07/29/2008 (i) EC 900 915 5.000% due 09/28/2011 (i) 300 262 ----------- Total Belgium 1,313 (Cost $1,436) ----------- -------------------------------------------------------------------------------- BRAZIL 1.2% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (d) $ 1,012 917 ----------- Total Brazil 917 (Cost $942) ----------- -------------------------------------------------------------------------------- CANADA (f)(g) 9.0% -------------------------------------------------------------------------------- Beneficial Canada, Inc. 6.350% due 04/01/2002 C$ 330 212 Commonwealth of Canada 7.000% due 12/01/2006 (i) 8,900 6,133 5.500% due 06/01/2010 800 510 ----------- Total Canada 6,855 (Cost $7,126) ----------- -------------------------------------------------------------------------------- CAYMAN ISLANDS (f)(g) 0.6% -------------------------------------------------------------------------------- International Credit Recovery-Japan 0.863% due 08/25/2005 JY 17,297 138 0.746% due 08/25/2005 10,000 80 MBNA American Euro 4.887% due 05/19/2004 (d) EC 280 246 ----------- Total Cayman Islands 464 (Cost $545) ----------- -------------------------------------------------------------------------------- DENMARK (f)(g) 1.7% -------------------------------------------------------------------------------- Lb Rheinland - PFALZ 4.750% due 04/04/2008 EC 810 704 Nykredit 6.000% due 10/01/2009 DK 3,986 455 Unikredit Realkredit 6.000% due 07/01/2029 997 114 ----------- Total Denmark 1,273 (Cost $1,249) ----------- -------------------------------------------------------------------------------- FRANCE (f)(g) 7.9% -------------------------------------------------------------------------------- Axa 2.500% due 01/01/2014 EC 62 54 Compagnie Financiere de CIC-UE 6.379% due 10/29/2049 (d) $ 300 293 Republic of France 5.500% due 04/25/2007 (i) EC 470 436 4.000% due 04/25/2009 (i) 1,170 982 3.000% due 07/25/2009 (h) 310 264 4.000% due 10/25/2009 (i) 4,460 3,689 5.500% due 04/25/2010 330 305 ----------- Total France 6,023 (Cost $6,178) ----------- -------------------------------------------------------------------------------- GERMANY (f)(g) 20.2% -------------------------------------------------------------------------------- Commerzbank AG 5.206% due 10/25/2032 (d) EC 800 706 Depfa Pfandbriefbank 4.750% due 07/15/2008 130 112 5.750% due 03/04/2009 (i) 130 119 Hypothekenbank in Essen AG 5.500% due 02/20/2007 (i) 310 281 Landesbank Baden-Wuerttemberg AG 5.500% due 04/02/2007 DM 390 354 Republic of Germany 6.000% due 07/04/2007 (i) EC 430 409 5.250% due 01/04/2008 (i) 3,630 3,333 4.125% due 07/04/2008 (i) 3,200 2,735 4.500% due 07/04/2009 (i) 5,480 4,782 5.375% due 01/04/2010 (i) 1,960 1,809 6.250% due 01/04/2030 (i) 200 199 Rheinische Hypothekenbank AG 4.250% due 09/24/2008 390 326 WestDeutsche Landersbank 4.750% due 09/28/2007 190 166 ----------- Total Germany 15,331 (Cost $15,502) ----------- -------------------------------------------------------------------------------- GREECE (f)(g) 0.7% -------------------------------------------------------------------------------- Hellenic Republic 6.938% due 06/06/2001 (d) $ 400 401 7.890% due 06/17/2003 (d) GD 22 20 7.080% due 10/23/2003 (d) 99 91 ----------- Total Greece 512 (Cost $558) ----------- -------------------------------------------------------------------------------- ITALY (f)(g) 17.2% -------------------------------------------------------------------------------- Finmeccanica SpA 2.000% due 06/08/2005 EC 188 160 First Italian Auto Transaction 5.139% due 07/01/2008 (d) 890 783 International Credit Recovery 5.602% due 03/15/2010 300 264 Island Finance 5.404% due 03/30/2015 (d) 370 327 Republic of Italy 5.750% due 09/15/2002 (i) 2,700 2,422 4.750% due 07/01/2005 (i) 1,680 1,488 7.750% due 11/01/2006 (i) 700 705 4.500% due 05/01/2009 (i) 6,980 5,944 4.250% due 11/01/2009 720 601 5.500% due 11/01/2010 (i) 390 354 ------------ Total Italy 13,048 (Cost $13,312) ------------ 148 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- JAPAN (f)(g) 1.7% -------------------------------------------------------------------------------- Government of Japan 3.400% due 06/20/2005 (i) JY 39,000 $ 348 0.900% due 12/22/2008 (d)(i) 103,600 820 SHL Corp. Ltd. 1.031% due 12/25/2024 (d) 11,051 88 1.331% due 12/25/2024 (d) 5,000 40 ------------ Total Japan 1,296 (Cost $1,408) ------------ -------------------------------------------------------------------------------- MEXICO (f)(g) 1.6% -------------------------------------------------------------------------------- Petroleos Mexicanos 8.850% due 09/15/2007 $ 140 144 9.375% due 12/02/2008 190 198 United Mexican States 8.750% due 05/30/2002 BP 250 361 5.000% due 09/30/2002 JY 25,000 207 10.375% due 01/29/2003 DM 200 96 4.000% due 03/11/2004 JY 20,000 163 ------------ Total Mexico 1,169 (Cost $1,273) ------------ -------------------------------------------------------------------------------- NETHERLANDS (f)(g) 0.7% -------------------------------------------------------------------------------- Unilever NV 4.830% due 09/17/2001 (d) EC 600 525 ------------ Total Netherlands 525 (Cost $512) ------------ -------------------------------------------------------------------------------- NEW ZEALAND (f)(g) 0.7% -------------------------------------------------------------------------------- Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 1,130 501 ------------ Total New Zealand 501 (Cost $637) ------------ -------------------------------------------------------------------------------- PERU 0.5% -------------------------------------------------------------------------------- Republic of Peru 4.000% due 03/07/2017 $ 250 156 4.500% due 03/07/2017 (d) 300 205 ------------ Total Peru 361 (Cost $373) ------------ -------------------------------------------------------------------------------- SOUTH KOREA (f)(g) 2.2% -------------------------------------------------------------------------------- Export-Import Bank Korea 7.250% due 06/25/2001 $ 260 261 Korea Development Bank 4.885% due 05/14/2001 DM 440 198 2.450% due 09/10/2001 JY 37,000 296 1.875% due 02/13/2002 114,000 911 ------------ Total South Korea 1,666 (Cost $1,795) ------------ -------------------------------------------------------------------------------- SPAIN (f)(g) 4.2% -------------------------------------------------------------------------------- Kingdom of Spain 4.950% due 07/30/2005 (i) EC 1,620 1,448 5.150% due 07/30/2009 (i) 1,990 1,782 ------------ Total Spain 3,230 (Cost $3,217) ------------ -------------------------------------------------------------------------------- SUPRANATIONAL (f)(g) 2.4% -------------------------------------------------------------------------------- Asian Development Bank 5.375% due 09/15/2003 A$ 600 295 5.250% due 09/15/2004 600 294 Eurofima 4.750% due 07/07/2004 (i) SK 7,200 696 International Bank for Reconstruction & Development 7.250% due 04/09/2001 N$ 1,376 555 ------------ Total Supranational 1,840 (Cost $2,246) ------------ -------------------------------------------------------------------------------- SWEDEN (f)(g) 0.4% -------------------------------------------------------------------------------- Kingdom of Sweden 13.000% due 06/15/2001 SK 900 $ 88 5.000% due 01/28/2009 2,300 228 ------------ Total Sweden 316 (Cost $348) ------------ -------------------------------------------------------------------------------- UNITED KINGDOM (f)(g) 10.4% -------------------------------------------------------------------------------- Abbey National Treasury Service PLC 7.625% due 12/30/2002 BP 280 411 British Telecommunications PLC 6.079% due 12/15/2003 (d) $ 600 600 Core 5.138% due 03/17/2009 (d) 461 458 Equitable 8.000% due 08/29/2049 BP 700 526 Haus Ltd. 5.124% due 12/10/2037 (d) EC 1,500 1,320 Holmes Financing PLC 5.859% due 07/15/2017 (d) $ 700 700 Lloyds TSB Bank PLC 5.625% due 07/15/2049 EC 590 492 Royal Bank of Scotland Group PLC 6.770% due 03/31/2049 1,000 919 SCCR Series 1 Ltd. 5.373% due 12/15/2031 (d) 118 104 United Kingdom Gilt 7.500% due 12/07/2006 (i) BP 750 1,200 7.250% due 12/07/2007 750 1,204 ------------ Total United Kingdom 7,934 (Cost $8,913) ------------ -------------------------------------------------------------------------------- UNITED STATES (f)(g) 71.0% -------------------------------------------------------------------------------- Asset-Backed Securities 7.7% AFC Home Equity Loan Trust 5.360% due 12/22/2027 (d) $ 302 302 Amresco Residential Securities Mortgage Loan Trust 6.000% due 06/25/2029 (d) 438 440 Banc One Auto Grantor Trust 6.270% due 11/20/2003 8 8 Bayview Financial Acquisition Trust 5.920% due 11/25/2030 (d) 700 700 Chase Manhattan Grantor Trust 6.610% due 09/15/2002 4 4 Conseco Finance 5.534% due 10/15/2031 (d) 633 636 CS First Boston Mortgage Securities Corp. 5.424% due 12/15/2030 (d) 672 673 EQCC Home Equity Loan Trust 5.770% due 05/20/2010 106 106 Nissan Auto Receivables Grantor Trust 5.450% due 04/15/2004 39 39 Providian Gateway Master Trust 5.380% due 03/15/2007 800 800 Providian Home Equity Loan Trust 5.340% due 06/25/2025 (d) 477 478 PSB Lending Home Loan Owner Trust 6.830% due 05/20/2018 23 23 Residential Asset Securities Corp. 5.854% due 12/25/2013 (d) 0 0 Residential Funding Mortgage Securities, Inc. 10.836% due 06/01/2001 (d) 800 800 Salomon Brothers Mortgage Securities VII 5.584% due 11/15/2029 (d) 137 137 United Panama Mortgage Loan Asset Backed 5.500% due 10/25/2029 (d) 576 577 USAA Auto Loan Grantor Trust 5.800% due 01/15/2005 113 114 ------------ 5,837 ------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 149 Schedule of Investments (Cont.) Global Bond Fund II March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Corporate Bonds & Notes 12.3% Alpha Wind 11.321% due 05/23/2001 (d) $ 500 $ 500 Associates Corp. of North America 5.400% due 08/27/2001 (d) 100 100 Associates First Capital Corp. 5.810% due 01/25/2031 (d) 588 588 Bancomext Trust Division 8.000% due 08/05/2003 70 71 Bear Stearns Co., Inc. 5.210% due 03/28/2003 (d) 380 380 Beckman Instruments, Inc. 7.100% due 03/04/2003 22 22 Capital One Bank 6.308% due 07/28/2003 (d) 500 492 Citi Credit Card Master Trust 4.875% due 04/07/2007 DM 800 360 CMS Energy Corp. 8.125% due 05/15/2002 $ 26 26 Finova Capital Corp. 6.040% due 11/08/2002 (d)(k) 1,250 1,026 6.316% due 04/08/2003 (d)(k) 700 574 Ford Motor Credit Co. 1.000% due 12/22/2003 JY 14,000 112 1.200% due 02/07/2005 98,000 780 Gold Eagle Capital Ltd. 11.079% due 04/15/2001 (d) $ 500 500 Household Finance Corp. 5.773% due 08/06/2002 (d) 230 231 J.P. Morgan & Co., Inc. 6.655% due 02/15/2012 (d) 100 91 Jones Intercable, Inc. 8.875% due 04/01/2007 26 28 Lehman Brothers Holdings, Inc. 6.479% due 07/15/2002 (d) 400 403 MGM Grand, Inc. 6.950% due 02/01/2005 10 10 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (h) 2,042 2,053 6.204% due 10/21/2002 (d) BP 200 284 Sprint Capital Corp. 5.875% due 05/01/2004 $ 50 49 TCI Communications, Inc. 5.555% due 04/01/2002 (d) 300 298 Texas Utilities Corp. 5.420% due 06/25/2001 (d) 200 200 7.389% due 09/24/2001 (d) 200 199 ------------ 9,377 ------------ Mortgage-Backed Securities 29.3% Chase Mortgage Finance Corp. 6.550% due 08/25/2028 420 424 Citicorp Mortgage Securities, Inc. 6.500% due 07/25/2028 255 256 6.500% due 03/25/2029 10 10 Crusade Global Trust 5.719% due 05/15/2030 (d) 1,403 1,407 Fannie Mae 7.000% due 02/25/2020 99 100 Government National Mortgage Association 5.750% due 02/16/2030 (d) 1,232 1,233 5.800% due 02/16/2030 (d) 1,334 1,337 6.000% due 06/20/2030-06/15/2029 (d)(e) 15,602 8,193 7.625% due 11/20/2021 (d) 36 37 7.750% due 07/20/2022 (d) 578 592 7.750% due 09/20/2023 (d) 348 356 7.750% due 07/20/2025 (d) 285 292 7.750% due 09/20/2025 (d) 33 34 7.625% due 12/20/2025 (d) 18 18 7.750% due 09/20/2026 (d) 21 21 7.625% due 11/20/2026 (d) 515 527 7.625% due 11/20/2026 (d) 242 248 7.625% due 12/20/2026 (d) 49 50 7.000% due 04/20/2030-05/20/2030 (d)(e) 3,062 1,845 Homeside Mortgage Securities Trust 5.929% due 01/20/2027 (d) 300 300 Medallion Trust 5.880% due 07/12/2031 (d) 821 821 Puma Finance Ltd. 5.916% due 04/15/2031 (d) 332 349 Residential Funding Mortgage Securities, Inc. 5.779% due 05/12/2032 (d) 2,245 2,248 Sasco Floating Rate Commercial Mortgage Trust 5.408% due 11/20/2001 (d) 380 380 Structured Asset Mortgage Investments, Inc. 6.581% due 06/25/2029 (d) 205 208 Structured Asset Securities Corp. 7.398% due 02/25/2030 (d) 1,034 1,036 ------------ 22,322 ------------ Municipal Bonds & Notes 0.8% California State General Obligation, (FGIC Insured), Series 1997 4.750% due 12/01/2028 300 280 Long Island Power Authority New York Electric System, (FSA Insured), Series 1998 5.125% due 12/01/2022 300 297 ------------ 577 ------------ U.S. Government Agencies 0.8% Small Business Administration 6.640% due 02/10/2011 600 604 U.S. Treasury Obligations 19.2% Treasury Inflation Protected Securities (h) 3.625% due 07/15/2002 (b)(i) 12,920 13,175 3.875% due 04/15/2029 319 341 U.S. Treasury Bonds 9.250% due 02/15/2016 600 829 8.875% due 02/15/2019 100 137 8.125% due 05/15/2021 100 130 ------------ 14,612 ------------ Preferred Security 0.9% Shares DG Funding Trust 7.153% due 12/29/2049 (d) 70 714 ------------ Total United States 54,043 (Cost $53,858) ------------ -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 0.0% -------------------------------------------------------------------------------- Principal Amount (000s) U.S. Treasury Note Futures (CBOT) Strike @ 119.000 Exp. 05/26/2001 $ 350 5 ------------ Total Purchased Call Options (Cost $7) 5 ------------ -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Government National Mortgage Association (OTC) 6.000% due 05/21/2031 Strike @ 90.281 Exp. 05/04/2001 24,000 0 Interest Rate Swap (OTC) 7.500% due 05/01/2023 Strike @ 7.500 Exp. 04/29/2002 700 1 Japanese Government Bond (OTC) 10.800% due 05/01/2023 Strike @ 97.750 Exp. 05/02/2001 1,300,000 0 U.S. Treasury Bond (OTC) 3.625% due 07/15/2002 Strike @ 95.500 Exp. 04/30/2001 13,620 0 ------------ Total Purchased Put Options 1 (Cost $36) ------------ 150 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 3.8% -------------------------------------------------------------------------------- Commercial Paper 2.7% Coca-Cola Co. 4.600% due 07/12/2001 $ 1,100 $ 1,085 General Electric Capital Corp. 4.970% due 04/04/2001 500 500 Halifax Building Society 5.080% due 08/08/2001 400 393 UBS Finance, Inc. 5.050% due 08/02/2001 100 98 ----------- 2,076 ----------- Repurchase Agreement 1.1% State Street Bank 4.600% due 04/02/2001 847 847 (Dated 03/30/2001. Collateralized by Freddie Mac 6.680% due 12/28/2001 valued at $869. Repurchase proceeds are $847.) ----------- Total Short-Term Instruments 2,923 (Cost $2,924) ----------- Total Investments (a) 163.4% $ 124,305 (Cost $127,242) Written Options (c) (0.2%) (141) (Premiums $56) Other Assets and Liabilities (48,071) (Net) (63.2%) ----------- Net Assets 100.0% $ 76,093 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $127,266 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 1,191 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (4,152) ------------ Unrealized depreciation-net (2,961) ------------ (b) Securities with an aggregate market value of $1,334 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contract (Depreciation) -------------------------------------------------------------------------------- EuroBond 10 Year Note (06/2001) 14 $ 14 Government of Japan 10 Year Note (06/2001) 13 10 United Kingdom Gilt (06/2001) 8 2 U.S. Treasury 10 Year Note (06/2001) 317 (77) ------------ $ (51) ------------ (c) Premiums received on written options: # of Type Contract Premium Value -------------------------------------------------------------------------------- Put - CME Eurodollar December Futures Strike @ 95.00 Exp. 12/17/2001 4 $ 2 $ 1 Call - CBOT U.S. Treasury Note June Futures Strike @ 107.00 Exp. 05/26/2001 3 2 3 Put - CME Eurodollar December Futures Strike @ 95.25 Exp. 12/17/2001 24 12 13 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 20 11 11 Put - OTC 3 Month LIBOR Interest Rate Swap Strike @ 7.50 Exp. 04/29/2002 1,000,000 22 105 Put - CBOT U.S. Treasury Note June Futures Strike @ 105.00 Exp. 05/26/2001 14 7 8 ------------------------- $ 56 $ 141 ------------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Securities are grouped together by coupon or range of coupons and represent a range of maturities. (f) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Sell A$ 1,450 04/2001 $ 65 Buy 269 05/2001 (2) Sell C$ 808 04/2001 10 Sell SF 5,302 05/2001 26 Sell DK 6,074 05/2001 39 Buy EC 12,608 04/2001 (100) Sell 11,741 04/2001 622 Sell 10,910 06/2001 41 Sell BP 2,479 05/2001 121 Sell H$ 13,000 05/2001 4 Buy 15,600 08/2001 (7) Sell 31,200 08/2001 24 Buy HF 47,700 08/2001 (4) Buy JY 669,475 04/2001 (132) Sell 670,601 04/2001 271 Sell 741,925 06/2001 145 Buy KW 181,300 04/2001 (23) Sell 181,300 04/2001 5 Sell N$ 2,623 04/2001 46 Sell SK 3,725 05/2001 23 Buy TB 3,800 04/2001 (3) Sell 3,800 04/2001 2 Buy TD 3,092 04/2001 (1) Sell 3,092 04/2001 1 ------------ $ 1,173 ------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 151 Schedule of Investments (Cont.) Global Bond Fund II March 31, 2001 -------------------------------------------------------------------------------- (g) Principal amount denoted in indicated currency: A$ - Australian Dollar BF - Belgian Franc BP - British Pound C$ - Canadian Dollar DK - Danish Krone DM - German Mark EC - Euro GD - Greek Drachma H$ - Hong Kong Dollar HF - Hungarian Forint JY - Japanese Yen KW - South Korean Won N$ - New Zealand Dollar SK - Swedish Krona SF - Swiss Franc TB - Thai Baht TD - Taiwan Dollar (h) Principal amount of the security is adjusted for inflation. (i) Subject to financing transaction. (j) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive fixed rate equal to 5.935% and pay floating rate based on 6 month BP-LIBOR. Broker: Merrill Lynch Exp. 11/05/2003 BP 1,700 $ 40 Receive floating rate based on 6-month Australian Bank Bill and pay fixed rate equal to 5.217%. Broker: Morgan Stanley Exp. 03/15/2006 A$ 3,600 17 Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.248%. Broker: Royal Bank of Canada Exp. 08/02/2005 C$ 8,500 (209) Receive floating rate based on 3-month H$-HIBOR and pay fixed rate equal to 6.910%. Broker: Goldman Sachs Exp. 02/15/2006 H$ 36,000 (244) Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.515%. Broker: J.P. Morgan Exp. 05/10/2002 C$ 3,400 (42) Receive floating rate based on 6-month JY-LIBOR and pay fixed rate equal to 2.020%. Broker: Goldman Sachs Exp. 05/18/2010 JY 226,000 (122) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.310%. Broker: Goldman Sachs Exp. 07/14/2005 232,000 (62) Receive fixed rate equal to 6.790% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 02/15/2006 4,600 271 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2006 36,300 744 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 06/15/2006 100 2 Receive fixed rate equal to 5.683% and pay floating rate based on 6 month BP-LIBOR. Broker: Morgan Stanley Exp. 01/08/2004 BP 4,200 63 Receive floating rate based on 3-month H$-HIBOR and pay fixed rate equal to 5.906%. Broker: Goldman Sachs Exp. 07/11/2006 H$ 50,000 (68) Receive fixed rate equal to 5.710% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 07/11/2006 $ 6,400 63 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2011 8,000 101 Receive fixed rate equal to 5.900% and pay floating rate based on 6 month BP-LIBOR. Broker: Goldman Sachs Exp. 01/26/2004 BP 2,400 40 Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.410%. Broker: Morgan Stanley Exp. 09/01/2002 1,300 (5) Receive fixed rate equal to 5.513% and pay floating rate based on 6 month BP-LIBOR. Broker: Morgan Stanley Exp. 03/01/2004 1,300 12 Receive fixed rate equal to 6.343% and pay floating rate based on 6 month EURO-LIBOR. Broker: Lehman Brothers Exp. 03/08/2016 EC 5,500 (3) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.465%. Broker: Lehman Brothers Exp. 03/07/2016 BP 3,500 6 152 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Receive fixed rate equal to 6.273% and pay floating rate based on 6 month EURO-LIBOR. Broker: Morgan Stanley Exp. 03/13/2016 EC 3,810 $ (8) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.578%. Broker: Morgan Stanley Exp. 03/13/2016 BP 2,380 (6) Receive fixed rate equal to 5.471% and pay floating rate based on 6 month BP-LIBOR. Broker: Goldman Sachs Exp. 03/15/2006 4,000 33 Receive fixed rate equal to 5.440% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 03/19/2006 $ 600 1 Receive floating rate based on 3-month H$-HIBOR and pay fixed rate equal to 5.550%. Broker: Goldman Sachs Exp. 03/16/2006 H$ 4,300 0 Receive fixed rate equal to 5.467% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 03/15/2006 $ 1,800 0 Receive fixed rate equal to 5.133% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 03/19/2003 BP 22,200 (21) ----------- $ 603 ----------- (k) Security is in default. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 153 Schedule of Investments Emerging Markets Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- BERMUDA 0.1% -------------------------------------------------------------------------------- IMEXA Export Trust 10.125% due 05/31/2003 $ 102 $ 91 ------------- Total Bermuda 91 (Cost $92) ------------- -------------------------------------------------------------------------------- BRAZIL 29.1% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (b) $ 1,795 1,627 7.687% due 04/15/2009 (b) 250 210 14.500% due 10/15/2009 2,500 2,702 8.000% due 04/15/2014 4,631 3,586 6.000% due 04/15/2024 750 516 7.625% due 04/15/2024 (b) 1,100 833 8.875% due 04/15/2024 3,350 2,278 10.125% due 05/15/2027 500 382 12.250% due 03/06/2030 2,600 2,295 11.000% due 08/17/2040 2,950 2,340 ------------- Total Brazil 16,769 (Cost $17,232) ------------- -------------------------------------------------------------------------------- BULGARIA 1.0% -------------------------------------------------------------------------------- Republic of Bulgaria 6.312% due 07/28/2011 (b) $ 250 188 6.312% due 07/28/2024 (b) 500 373 ------------- Total Bulgaria 561 (Cost $604) ------------- -------------------------------------------------------------------------------- CROATIA 4.2% -------------------------------------------------------------------------------- Republic of Croatia 6.250% due 07/31/2006 (b) $ 1,456 1,423 6.250% due 07/31/2010 (b) 993 971 ------------- Total Croatia 2,394 (Cost $2,384) ------------- -------------------------------------------------------------------------------- MALAYSIA 2.6% -------------------------------------------------------------------------------- Republic of Malaysia 6.875% due 05/15/2001 $ 1,500 1,522 ------------- Total Malaysia 1,522 (Cost $1,499) ------------- -------------------------------------------------------------------------------- MEXICO 20.1% -------------------------------------------------------------------------------- United Mexican States 0.000% due 06/30/2003 $ 9,459 118 10.375% due 02/17/2009 250 275 9.875% due 02/01/2010 1,000 1,076 11.375% due 09/15/2016 250 289 8.125% due 12/30/2019 3,250 2,919 6.250% due 12/31/2019 4,075 3,683 7.412% due 12/31/2019 (b) 1,025 1,003 7.515% due 12/31/2019 400 391 7.532% due 12/31/2019 1,150 1,125 11.500% due 05/15/2026 575 696 ------------- Total Mexico 11,575 (Cost $11,291) ------------- -------------------------------------------------------------------------------- MOROCCO 1.0% -------------------------------------------------------------------------------- Morroco Restructured Tranche A 7.652% due 01/01/2009 $ 658 584 ------------- Total Morocco 584 (Cost $593) ------------- -------------------------------------------------------------------------------- NIGERIA 0.8% -------------------------------------------------------------------------------- Central Bank of Nigeria 6.250% due 11/15/2020 $ 750 469 Central Bank of Nigeria - Warrant 0.000% due 11/15/2020 1 0 ------------- Total Nigeria 469 (Cost $430) ------------- -------------------------------------------------------------------------------- PANAMA 4.7% -------------------------------------------------------------------------------- Republic of Panama 7.875% due 02/13/2002 $ 50 50 7.733% due 05/14/2002 69 70 9.625% due 02/08/2011 600 596 4.500% due 07/17/2014 1,375 1,148 8.875% due 09/30/2027 500 439 9.375% due 04/01/2029 400 403 ------------- Total Panama 2,706 (Cost $2,637) ------------- -------------------------------------------------------------------------------- PERU 2.6% -------------------------------------------------------------------------------- Republic of Peru 4.000% due 03/07/2017 $ 2,100 1,313 4.500% due 03/07/2017 250 170 ------------- Total Peru 1,483 (Cost $1,473) ------------- -------------------------------------------------------------------------------- PHILIPPINES 0.7% -------------------------------------------------------------------------------- Republic of Philippines 6.500% due 12/01/2017 $ 500 405 ------------- Total Philippines 405 (Cost $392) ------------- -------------------------------------------------------------------------------- POLAND 4.1% -------------------------------------------------------------------------------- Republic of Poland 6.000% due 10/27/2014 $ 1,315 1,281 3.750% due 10/27/2024 1,450 1,058 ------------- Total Poland 2,339 (Cost $2,226) ------------- -------------------------------------------------------------------------------- QATAR 2.1% -------------------------------------------------------------------------------- State of Qatar 9.750% due 06/15/2030 $ 1,125 1,198 ------------- Total Qatar 1,198 (Cost $1,084) ------------- -------------------------------------------------------------------------------- RUSSIA 13.4% -------------------------------------------------------------------------------- Russian Federation 9.250% due 11/27/2001 $ 1,250 1,257 11.750% due 06/10/2003 2,900 2,834 8.750% due 07/24/2005 700 575 8.250% due 03/31/2010 353 238 11.000% due 07/24/2018 650 486 12.750% due 06/24/2028 1,850 1,622 5.000% due 03/31/2030 647 262 5.000% due 03/31/2030 1,004 411 ------------- Total Russia 7,685 (Cost $7,213) ------------- -------------------------------------------------------------------------------- SOUTH AFRICA 0.9% -------------------------------------------------------------------------------- Republic of South Africa 9.125% due 05/19/2009 $ 500 522 ------------- Total South Africa 522 (Cost $514) ------------- -------------------------------------------------------------------------------- SOUTH KOREA 3.0% -------------------------------------------------------------------------------- Korea Development Bank 7.125% due 09/17/2001 $ 500 503 Republic of Korea 8.875% due 04/15/2008 1,100 1,221 ------------- Total South Korea 1,724 (Cost $1,641) ------------- 154 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- VENEZUELA 5.9% -------------------------------------------------------------------------------- Republic of Venezuela 7.375% due 12/18/2 (b) $ 1,500 $ 1,255 6.750% due 03/31/2020 1,475 1,136 9.250% due 09/15/2027 1,430 993 Republic of Venezuela - Warrant 0.000% due 04/15/2020 6 0 ------------- Total Venezuela 3,384 (Cost $3,371) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 5.1% -------------------------------------------------------------------------------- Commercial Paper 5.1% Abbey National North America 5.090% due 04/19/2001 $ 100 100 4.870% due 05/02/2001 1,000 996 American Express Credit Corp. 5.100% due 04/06/2001 200 200 General Electric Capital Corp. 4.970% due 04/04/2001 200 200 UBS Finance, Inc. 5.340% due 05/16/2001 300 298 5.040% due 08/02/2001 600 590 5.070% due 08/08/2001 300 294 Verizon Global Funding 4.950% due 06/15/2001 300 297 ------------- Total Short-Term Instruments 2,975 (Cost $2,975) ------------- Total Investments (a) 101.4% $ 58,386 (Cost $57,651) Other Assets and Liabilities (Net) (1.4%) (788) ------------- Net Assets 100.0% $ 57,598 ------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $58,137 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 1,278 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (1,029) ------------- Unrealized appreciation-net $ 249 ------------- (b) Variable rate security. The rate listed is as of March 31, 2001. (c) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy HF 909,150 05/2001 $ (75) Sell 550,000 05/2001 127 Buy 158,130 08/2001 (26) Buy 48,055 09/2001 (8) Buy PZ 750 05/2001 27 ------------- $ 45 ------------- (d) Principal amount denoted in indicated currency: HF - Hungarian Forint PZ - Polish Zloty See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 155 Schedule of Investments Strategic Balanced Fund March 31, 2001 Value Shares (000s) -------------------------------------------------------------------------------- PIMCO FUNDS (b) 93.5% -------------------------------------------------------------------------------- StocksPLUS 3,982,096 $ 40,618 Total Return 2,761,234 29,048 ------------- Total PIMCO Funds 69,666 (Cost $80,568) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 5.7% -------------------------------------------------------------------------------- Principal Amount (000s) Repurchase Agreement 5.7% State Street Bank 4.600% due 04/02/2001 $ 4,279 4,279 (Dated 03/30/2001. Collateralized by Freddie Mac 6.680% due 12/28/2001 valued at $4,369. Repurchase proceeds are $4,281.) ------------- Total Short-Term Instruments 4,279 (Cost $4,279) ------------- Total Investments (a) 99.2% $ 73,945 (Cost $84,847) Other Assets and Liabilities 559 (Net) 0.8% ------------- Net Assets 100.0% $ 74,504 ------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $85,450 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 1,059 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (12,564) ------------- Unrealized depreciation-net $ (11,505) ------------- (b) Institutional Class shares of each PIMCO Fund. 156 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments Convertible Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES (c)(d) 56.9% -------------------------------------------------------------------------------- Banking & Finance 2.8% Hellenic Finance 2.000% due 07/15/2003 EC 500 $ 440 JMH Finance Ltd. 4.750% due 09/06/2007 $ 1,200 1,226 Swiss Life Finance Ltd. 2.000% due 05/20/2003 EC 600 505 0.750% due 05/20/2005 SF 750 429 ------------- 2,600 ------------- Energy 1.2% Diamond Offshore Drilling 3.750% due 02/15/2007 $ 1,060 1,077 ------------- Health Care 6.3% Millennium Pharmaceuticals 5.500% due 01/15/2007 1,500 1,513 Roche Holdings, Inc. 0.010% due 01/19/2015 3,650 2,665 Wellpoint Health Network, Inc. 0.000% due 07/02/2019 2,000 1,613 ------------- 5,791 ------------- Industrial 23.0% Allergan, Inc. 0.000% due 11/01/2020 2,600 1,619 Burr-Brown Corp. 4.250% due 02/15/2007 1,000 1,110 Celestica, Inc. 0.000% due 08/01/2020 3,500 1,247 Comverse Technology, Inc. 1.500% due 12/01/2005 2,000 1,713 Corning, Inc. 0.000% due 11/08/2015 1,700 1,003 Dupont Photomasks, Inc. 0.000% due 07/24/2004 1,300 1,181 Exodus Communications, Inc. 5.250% due 02/15/2008 2,000 1,320 4.750% due 07/15/2008 2,000 1,073 Omnicom Group, Inc. 2.250% due 01/06/2013 550 960 Sanmina Corp. 4.250% due 05/01/2004 1,200 1,353 Solectron Corp. 0.000% due 01/27/2019 2,625 1,280 0.000% due 05/08/2020 2,500 1,259 Tyco International Ltd. 0.000% due 11/17/2020 3,300 2,446 Universal Health Services 0.426% due 06/23/2020 2,000 1,183 Young & Rubicam, Inc. 3.000% due 01/15/2005 2,500 2,344 ------------- 21,091 ------------- Technology 11.0% Analog Devices, Inc. 4.750% due 10/01/2005 1,700 1,509 ASM Lithography Holding 2.500% due 04/09/2005 NL 1,500 783 Bisys Group, Inc. 4.000% due 03/15/2006 $ 1,250 1,313 Juniper Networks, Inc. 4.750% due 03/15/2007 2,000 1,465 Lattice Semiconductor Co. 4.750% due 11/01/2006 600 662 STMicroelectronics NV 0.010% due 09/22/2009 900 960 U.S. Cellular Corp. 0.010% due 06/15/2015 3,350 1,968 VERITAS Software Corp. 1.856% due 08/13/2006 1,000 1,441 ------------- 10,101 ------------- Utilities 12.6% AES Corp. 4.500% due 08/15/2005 750 1,407 Alliant Energy Resources, Inc. 7.250% due 02/15/2030 33 1,541 AT&T - Liberty Media Group 4.000% due 11/15/2029 2,200 1,436 3.500% due 01/15/2031 1,500 1,127 Cienna Corp. 3.750% due 02/01/2008 2,000 1,563 Comcast Corp. 0.000% due 12/19/2020 1,000 820 Kerr-McGee Corp. 5.250% due 02/15/2010 1,000 1,235 Nabors Industries, Inc. 0.000% due 02/05/2021 2,000 1,156 Nextel Communications, Inc. 5.250% due 01/15/2010 2,000 1,293 ------------- 11,578 ------------- Total Convertible Bonds & Notes 52,238 (Cost $61,854) ------------- -------------------------------------------------------------------------------- CONVERTIBLE PREFERRED STOCK 34.6% -------------------------------------------------------------------------------- Shares Banking & Finance 4.7% Metlife Capital Trust I Cvt. Pfd. 8.000% due 05/15/2003 41,000 3,875 Union Pacific Capital Trust Cvt. Pfd. 6.250% due 04/21/2028 9,200 453 ------------- 4,328 ------------- Energy 12.8% Apache Corp. Cvt. Pfd. 6.500% due 05/15/2002 37,000 1,796 Kerr-McGee Corp. Cvt. Pfd. 5.500% due 08/01/2004 58,900 3,156 Mirant Trust I Cvt. Pfd. 6.250% due 10/01/2030 50,000 3,725 Valero Energy Cvt. Pfd. 7.750% due 08/18/2003 100,500 3,035 ------------- 11,712 ------------- Industrial 10.6% Cox Communications, Inc. Cvt. Pfd. 7.000% due 08/16/2002 46,000 2,736 Express Scripts Exchange Trust Cvt. Pfd. 7.000% due 11/15/2003 26,000 2,053 Qwest Trends Trust Cvt. Pfd. 5.750% due 11/17/2003 25,000 1,534 Tribune Co. Cvt. Pfd. 2.000% due 05/15/2029 35,100 3,405 ------------- 9,728 ------------- Utilities 6.5% AES Trust VII Cvt. Pfd. 6.000% due 05/15/2008 24,400 1,565 Duke Energy Corp. Cvt. Pfd. 8.250% due 05/18/2004 100,000 2,724 Enron Corp. Cvt. Pfd. 7.000% due 07/31/2002 28,000 1,026 MediaOne Group, Inc. Cvt. Pfd. 6.250% due 08/15/2001 9,500 625 5,940 ------------- Total Convertible Preferred Stock 31,708 (Cost $28,836) ------------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 157 Schedule of Investments (Cont.) Convertible Fund March 31, 2001 Value Shares (000s) -------------------------------------------------------------------------------- COMMON STOCKS 2.7% -------------------------------------------------------------------------------- Communications 0.0% Leap Wireless International,Inc. (b) 344 $ 10 ------------- Health Care 0.6% Elan Corp. PLC (b) 10,114 528 ------------- Technology 2.1% AOL Time Warner, Inc. (b) 2,100 84 EMC Corp. (b) 60,668 1,784 McData Corp. `A' (b) 2,233 42 ------------- 1,910 ------------- Total Common Stocks 2,448 (Cost $3,994) ------------- Total Investments (a) 94.2% $ 86,394 (Cost $94,684) Other Assets and Liabilities (Net) 5.8% 5,296 ------------- Net Assets 100.0% $ 91,690 ------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $94,699 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 6,705 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (15,010) ------------- Unrealized depreciation-net $ (8,305) ------------- (b) Non-income producing security. (c) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy EC 2,111 04/2001 $ (7) Sell 2,111 04/2001 111 Sell 2,111 06/2001 7 Buy JY 148,448 04/2001 (30) Sell 93,323 04/2001 41 Sell 93,323 06/2001 18 Sell SF 772 05/2001 4 ------------- $ 144 ------------- (d) Principal amount denoted in indicated currency: EC - Euro JY - Japanese Yen SF - Swiss Franc 158 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments European Convertible Bond March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES (b)(c) 67.1% -------------------------------------------------------------------------------- Banking & Finance 24.5% Axa 2.500% due 01/01/2014 EC 165 $ 144 Fortis (NL) NV 1.500% due 07/29/2004 200 183 Swiss America Holdings 2.250% due 06/10/2004 $ 150 149 Swiss Life Finance Ltd. 2.000% due 05/20/2003 200 202 0.750% due 05/20/2005 250 143 2.000% due 05/20/2005 200 205 Verizon Global Funding Corp. 4.250% due 09/15/2005 200 202 ------------- 1,228 ------------- Health Care 5.9% Roche Holdings, Inc. 0.000% due 04/20/2010 200 113 0.000% due 01/19/2015 250 183 ------------- 296 ------------- Industrial 33.3% Finmeccanica SpA 2.000% due 06/08/2005 EC 200 171 France Telecom 4.125% due 11/29/2004 250 210 Hutchison Whampoa International 2.875% due 09/15/2003 $ 200 193 Koninklijke Ahold NV 4.000% due 05/19/2005 EC 150 157 Nestle Australia Ltd. 1.250% due 04/27/2005 $ 200 192 Siemens Nederland NV 1.000% due 08/10/2005 EC 200 161 Tecnost International NV 1.000% due 11/03/2005 200 175 Usinor 3.875% due 01/01/2005 248 215 Vivendi Universal 1.250% due 01/01/2004 226 192 ------------- 1,666 ------------- Technology 3.4% STMicroelectronics NV 0.000% due 11/16/2010 $ 250 168 ------------- Total Convertible Bonds & Notes 3,358 (Cost $3,523) ------------- -------------------------------------------------------------------------------- CONVERTIBLE PREFERRED STOCK 3.3% -------------------------------------------------------------------------------- Shares Utilities 3.3% MediaOne Group, Inc. Cvt. Pfd. 6.250% due 08/15/2001 2,500 165 ------------- Total Convertible Preferred Stock 165 (Cost $209) ------------- -------------------------------------------------------------------------------- COMMON STOCKS 1.9% -------------------------------------------------------------------------------- Health Care 1.9% Elan Corp. PLC 1,815 93 ------------- Total Common Stocks 93 (Cost $92) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 23.7% -------------------------------------------------------------------------------- Principal Amount (000s) Commercial Paper 19.9% Abbey National North America 5.060% due 08/01/2001 $ 200 197 CBA (de) Finance 5.040% due 04/23/2001 100 100 CDC 5.450% due 04/11/2001 300 300 General Electric Capital Corp. 5.070% due 04/04/2001 200 200 KFW International Finance, Inc. 5.340% due 04/24/2001 200 199 ------------- 996 ------------- Repurchase Agreement 3.8% State Street Bank 4.600% due 04/02/2001 194 194 (Dated 03/30/2001. Collateralized by Fannie Mae 0.000% due 04/17/2001 valued at $200. Repurchase proceeds are $194.) ------------- Total Short-Term Instruments 1,190 (Cost $1,189) ------------- Total Investments (a) 96.0% $ 4,806 (Cost $5,013) Other Assets and Liabilities (Net) 4.0% 201 ------------- Net Assets 100.0% $ 5,007 ------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $5,013 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 25 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (232) ------------- Unrealized depreciation-net $ (207) ------------- (b) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy EC 1,875 04/2001 $ (6) Sell 1,875 04/2001 99 Sell 1,875 06/2001 7 Sell SF 257 05/2001 1 ----------- $ 101 ----------- (c) Principal amount denoted in indicated currency: EC - Euro SF - Swiss Franc See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 159 Schedule of Investments StocksPLUS Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 29.0% -------------------------------------------------------------------------------- Banking & Finance 11.7% Atlas Reinsurance PLC 9.820% due 10/04/2004 (d) $ 7,000 $ 7,000 Bear Stearns Co., Inc. 6.125% due 02/01/2003 1,100 1,109 Beaver Valley Funding Corp. 8.250% due 06/01/2003 1,193 1,226 Capital One Bank 7.610% due 06/23/2003 (d) 5,400 5,282 Chrysler Financial Corp. LLC 5.745% due 02/10/2003 (d) 9,600 9,476 Donaldson, Lufkin & Jenrette, Inc. 6.022% due 04/25/2003 (d) 6,900 6,903 Ford Credit Canada 6.820% due 12/16/2002 (d) 3,800 3,796 Ford Motor Credit Co. 6.699% due 03/19/2002 (d) 590 589 5.938% due 07/16/2002 (d) 6,800 6,798 6.850% due 03/17/2003 (d) 500 496 General Motors Acceptance Corp. 6.190% due 04/15/2001 (d) 1,000 1,001 Gold Eagle Capital Ltd. 11.078% due 04/15/2001 (d) 10,000 10,000 Golden State Holdings 6.525% due 08/01/2003 (d) 6,000 5,815 Lehman Brothers Holdings, Inc. 6.972% due 06/03/2002 (d) 600 601 6.478% due 07/15/2002 (d) 3,005 3,025 MBNA Corp. 6.980% due 09/13/2001 (d) 3,100 3,103 Nacional Financiera 8.575% due 05/08/2003 (d) 6,000 6,134 National Australia Bank Ltd. 7.385% due 05/19/2010 (d) 11,700 11,781 NationsBank Corp. 3.733% due 02/18/2002 (d) 100 100 Old Kent Bank 6.275% due 11/01/2005 (d) 4,500 4,495 Republic New York Corp. 6.652% due 10/28/2002 (d) 100 100 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (g) 3,400 3,419 6.980% due 02/11/2003 (d) 5,000 5,007 6.530% due 03/26/2003 (d) 5,000 5,013 Western Capital 10.665% due 01/07/2003 16,300 16,310 ------------- 118,579 ------------- Industrials 8.5% Air Canada 6.037% due 07/31/2005 (d) 9,818 9,094 Cemex SA de CV 9.250% due 06/17/2002 300 309 Clear Channel Communications, Inc. 7.210% due 06/15/2002 (d) 600 602 CSX Corp. 7.365% due 06/24/2002 (d) 6,900 6,905 Enron Corp. 5.510% due 09/10/2001 (d) 1,000 1,001 8.000% due 08/15/2005 1,100 1,180 Kroger Co. 6.340% due 06/01/2001 2,000 2,002 Petroleos Mexicanos 7.768% due 07/15/2005 (d) 20,000 20,050 Raytheon Co. 5.738% due 08/10/2001 (d) 8,900 8,910 Rollins Truck Leasing Co. 8.250% due 05/01/2002 29,900 30,708 TCI Communications, Inc. 7.236% due 03/11/2003 (d) 4,000 4,024 TRW, Inc. 6.450% due 06/15/2001 400 400 Waste Management, Inc. 6.000% due 05/15/2001 1,500 1,498 ------------- 86,683 ------------- Utilities 8.8% British Telecommunications PLC 7.722% due 12/15/2003 (d) $ 10,300 10,304 Central Power & Light Co. 7.420% due 11/23/2001 (d) 3,600 3,604 El Paso Energy Corp. 6.328% due 07/15/2001 (d) 4,800 4,803 Entergy Arkansas, Inc. 7.720% due 03/01/2003 3,700 3,829 Marlin Water Trust 7.090% due 12/15/2001 4,049 4,085 Montana Power Co. 7.000% due 04/06/2001 (d) 1,200 1,201 Nevada Power Co. 5.623% due 06/12/2001 (d) 13,000 13,000 Niagara Mohawk Power Co. 7.125% due 07/01/2001 6,805 6,833 Sprint Capital Corp. 6.927% due 06/10/2002 (d) 1,100 1,102 System Energy Resources, Inc. 7.710% due 08/01/2001 250 252 Texas Utilities Corp. 7.210% due 06/25/2001 (d) 1,900 1,900 5.940% due 10/15/2001 28,725 28,860 6.410% due 11/21/2001 1,000 1,009 Western Massachusetts Electric Co. 7.750% due 12/01/2002 1,882 1,884 Williams Cos., Inc. 7.180% due 11/15/2001 (d) 6,900 6,910 ------------- 89,576 ------------- Total Corporate Bonds & Notes 294,838 (Cost $292,845) ------------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 13.3% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (g) 3.625% due 07/15/2002 (b) 114,252 116,500 3.625% due 01/15/2008 17,775 18,192 ------------- Total U.S. Treasury Obligations 134,692 (Cost $131,282) ------------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 75.5% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 14.7% Bank Mart 6.883% due 03/01/2019 (j) 3,908 3,961 California Federal Savings & Loan 7.323% due 07/25/2018 (d) 19 19 Countrywide Home Loans 6.050% due 04/25/2029 4,653 4,678 CS First Boston Mortgage Securities Corp. 6.960% due 01/20/2004 1,710 1,746 DLJ Acceptance Trust 7.910% due 10/17/2020 (d) 123 126 Fannie Mae 5.700% due 06/25/2017 62 62 6.761% due 04/25/2020 (d) 18 18 6.500% due 05/18/2024 2,976 3,011 Freddie Mac 7.000% due 06/15/2023 107 107 6.500% due 08/15/2023 6,446 6,499 Fund America Investors Corp. II 8.079% due 06/25/2023 (d) 97 97 General Electric Capital Mortgage Services, Inc. 6.300% due 09/25/2023 1,616 1,620 6.250% due 10/25/2028 614 617 6.250% due 12/25/2028 1,464 1,406 Government National Mortgage Association 6.220% due 02/16/2030 (d) 13,670 13,704 7.250% due 02/16/2030 (d) 23,419 23,463 6.070% due 02/16/2030 (d) 24,934 25,059 6.236% due 06/20/2030 (d) 18,358 18,387 6.236% due 09/20/2030 (d) 289 290 160 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Greenwich Capital Acceptance, Inc. 8.302% due 04/25/2022 (d) $ 166 $ 165 8.230% due 10/25/2022 (d) 5 5 Housing Securities, Inc. 7.320% due 07/25/2032 (d) 400 400 J.P. Morgan & Co., Inc. 6.817% due 01/25/2018 (d) 237 232 Norwest Asset Securities Corp. 6.750% due 08/25/2029 7,443 7,507 PNC Mortgage Securities Corp. 6.625% due 03/25/2028 6,557 6,603 7.500% due 05/25/2040 (d) 5,511 5,589 Resecuritization Mortgage Trust 5.991% due 04/26/2021 (d) 217 215 Residential Funding Mortgage Securities, Inc. 6.798% due 03/25/2018 (d) 1,395 1,387 Resolution Trust Corp. 8.000% due 06/25/2026 562 565 Structured Asset Mortgage Investments, Inc. 9.030% due 06/25/2029 (d) 16,209 17,417 Structured Asset Securities Corp. 7.599% due 09/25/2036 (d) 735 749 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 3,911 3,911 ------------- 149,615 ------------- Fannie Mae 12.4% 6.252% due 12/01/2023 (d) 20 20 6.320% due 05/01/2017 (d) 229 233 6.328% due 02/01/2027-02/01/2031 (d)(i) 686 696 6.446% due 04/01/2018-08/01/2029 (d)(i) 2,677 2,721 6.500% due 09/01/2005 4,723 4,811 7.500% due 04/16/2031 80,000 81,750 7.900% due 05/01/2022 (d) 224 225 8.000% due 04/16/2031 34,000 35,063 ------------- 125,519 ------------- Freddie Mac 0.3% 6.768% due 07/01/2019 (d) 2,373 2,409 7.616% due 12/01/2022 (d) 507 519 8.161% due 06/01/2022 (d) 314 320 8.500% due 04/01/2025-06/01/2025 (i) 181 190 ------------- 3,438 ------------- Government National Mortgage Association 48.0% 6.750% due 07/20/2018-08/20/2026 (d)(i) 14,714 15,064 7.000% due 04/23/2031 101,000 102,579 7.125% due 12/20/2022-12/20/2027 (d)(i) 6,462 6,624 7.375% due 02/20/2026-02/20/2028 (d)(i) 14,566 14,756 7.500% due 08/15/2028-04/23/2031 (i) 198,300 203,306 8.000% due 04/23/2031 141,000 145,347 ------------- 487,676 ------------- Stripped Mortgage-Backed Securities 0.1% Fannie Mae (IO) 7.000% due 07/25/2006 155 4 6.500% due 09/25/2008 161 13 6.500% due 02/25/2021 (d) 1,364 60 7.000% due 07/25/2021 546 61 6.500% due 03/25/2023 2,420 270 Freddie Mac (IO) 6.500% due 08/15/2006 803 23 ------------- 431 ------------- Total Mortgage-Backed Securities 766,679 (Cost $764,294) ------------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 9.6% -------------------------------------------------------------------------------- AFC Home Equity Loan Trust 5.200% due 06/25/2028 (d) 5,893 5,878 Amresco Residential Securities Mortgage Loan Trust 6.810% due 07/25/2027 (d) 15 15 5.868% due 05/25/2028 (d) 154 154 Argentina Funding Corp. 5.840% due 05/20/2003 (d) 16,000 16,037 Bayview Financial Acquisition Trust 6.080% due 02/25/2029 (d) 4,493 4,514 Cross Country Master Credit Card Trust II 5.663% due 06/15/2006 (d) 15,400 15,532 Green Tree Home Improvement Loan Trust 6.742% due 11/15/2029 (d) 6,085 6,087 Green Tree Recreational, Equipment, & Consumables 6.430% due 04/17/2006 1,233 1,245 Novastar Home Equity Loan 5.325% due 04/25/2028 (d) 2,632 2,600 SallieMae 5.841% due 07/25/2004 (d) 187 187 5.901% due 10/25/2005 (d) 5,818 5,818 5.961% due 04/25/2006 (d) 2,407 2,404 Salomon Brothers Mortgage Securities VII 5.390% due 02/25/2030 (d) 18,646 18,694 Starwood Hotel 7.241% due 02/23/2003 8,702 8,653 The Money Store Home Equity Trust 6.550% due 09/15/2021 280 280 6.345% due 11/15/2021 120 120 USAA Auto Loan Grantor Trust 6.100% due 02/15/2006 9,530 9,667 ------------- Total Asset-Backed Securities 97,885 (Cost $97,302) ------------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 11.5% -------------------------------------------------------------------------------- Hydro-Quebec 5.187% due 09/29/2049 (d) 1,200 1,068 Republic of Brazil 7.375% due 04/15/2006 (d) 26,356 23,886 Republic of Croatia 7.000% due 02/27/2002 3,000 3,006 Republic of Germany 3.000% due 06/15/2001 90,000 78,934 Republic of Panama 7.930% due 05/10/2002 824 832 United Mexican States 10.021% due 04/07/2004 (d) 9,000 9,248 ------------- Total Sovereign Issues 116,974 (Cost $119,870) ------------- -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES (e)(f) 2.0% -------------------------------------------------------------------------------- Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 9,750 4,320 Korea Development Bank 2.560% due 06/26/2001 JY 1,000,000 8,000 United Mexican States 8.750% due 05/30/2002 BP 3,000 4,330 7.000% due 06/02/2003 C$ 6,000 3,806 ------------- Total Foreign 20,456 Currency-Denominated Issues ------------- (Cost $23,395) -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 0.0% -------------------------------------------------------------------------------- U.S. Treasury Note (OTC) 5.750% due 11/15/2005 Strike @ 110.875 Exp. 07/02/2001 $ 100,000 16 ------------- Total Purchased Call Options 16 (Cost $16) ------------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 161 Schedule of Investments (Cont.) StocksPLUS Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Government National Mortgage Association (OTC) 7.000% due 05/21/2031 Strike @ 94.641 Exp. 05/04/2001 $ 100,000 $ 0 Government National Mortgage Association (OTC) 7.500% due 06/20/2031 Strike @ 95.625 Exp. 06/13/2001 369,000 15 PNC Mortgage Securities (OTC) 7.500% due 05/25/2040 Strike @ 100.000 Exp. 04/01/2005 6,200 0 ------------- Total Purchased Put Options (Cost $37) 15 ------------- -------------------------------------------------------------------------------- PREFERRED SECURITY 0.1% -------------------------------------------------------------------------------- Shares DG Funding Trust 7.153% due 12/29/2049 (d) 110 1,122 ------------- Total Preferred Security (Cost $1,103) 1,122 ------------- -------------------------------------------------------------------------------- PREFERRED STOCK 0.8% -------------------------------------------------------------------------------- TCI Communications, Inc. 9.720% due 12/31/2036 303,565 7,726 ------------- Total Preferred Stock (Cost $7,996) 7,726 ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 10.2% -------------------------------------------------------------------------------- Principal Amount (000s) Commercial Paper 8.6% American Express Credit Corp. 4.940% due 05/15/2001 $ 6,600 6,561 Gannett Co., Inc. 5.000% due 04/20/2001 24,700 24,637 KFW International Finance, Inc. 4.820% due 05/30/2001 9,900 9,823 Monsanto Co. 4.650% due 08/16/2001 3,600 3,535 Swedbank, Inc. 4.930% due 04/25/2001 9,900 9,869 4.700% due 09/05/2001 14,900 14,592 UBS Finance, Inc. 5.400% due 04/02/2001 15,900 15,900 4.820% due 08/15/2001 2,000 1,964 ------------- 86,881 ------------- Repurchase Agreement 1.6% State Street Bank 4.600% due 03/30/2001 5,844 5,844 (Dated 03/30/2001. Collateralized by Fannie Mae 5.600% due 07/25/2003 valued at $5,965. Repurchase proceeds are $5,846.) Daiwa Securities 5.150% due 04/02/2001 10,000 10,000 (Dated 03/30/2001. Collateralized by U.S. Treasury Bill due 06/28/2001 valued at $10,316. Repurchase proceeds are $10,004.) ------------- 15,844 ------------- U.S. Treasury Bills (b)(i) 0.0% 4.915% due 05/17/2001 510 507 ------------- Total Short-Term Instruments 103,232 (Cost $103,239) ------------- Total Investments (a) 152.0% 1,543,635 (Cost $1,541,379) Written Options (c) (0.1% (815) (Premiums $756) Other Assets and Liabilities (Net) (51.9%) (527,337) ------------- Net Assets 100.0% $ 1,015,483 ------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,541,331 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 9,728 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (7,424) ------------- Unrealized appreciation-net $ 2,304 ------------- (b) Securities with an aggregate market value of $86,796 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- S&P 500 Index (06/2001) 1,054 $ (27,301) S&P 500 Index (09/2001) 1,573 396 U.S. Treasury 5 Year Note (06/2001) 977 (599) ------------- $ (27,504) ------------- (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Call - CME S&P June Futures Strike @ 1,380.00 Exp. 06/15/2001 56 $ 203 $ 25 Put - CME S&P June Futures Strike @ 1,160.00 Exp. 06/15/2001 56 302 665 Put - CME S&P June Futures Strike @ 1,050.00 Exp. 06/15/2001 28 251 125 ------------------------ $ 756 $ 815 ------------------------ (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Sell BP 3,902 05/2001 $ 192 Sell C$ 5,773 04/2001 72 Buy EC 73,359 04/2001 (235) Sell 74,823 04/2001 3,715 Sell 73,359 06/2001 275 Buy HF 2,300,000 09/2001 (171) Buy JY 1,436,697 04/2001 (285) Sell 1,436,697 04/2001 634 Sell 1,436,697 06/2001 282 Sell N$ 10,942 04/2001 187 ------------- $ 4,666 ------------- 162 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes -------------------------------------------------------------------------------- (f) Principal amount denoted in indicated currency: BP - British Pound C$ - Canadian Dollar EC - Euro HF - Hungarian Forint JY - Japanese Yen N$ - New Zealand Dollar (g) Principal amount of the security is adjusted for inflation. (h) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount/Units Appreciation -------------------------------------------------------------------------------- Receive total return on S&P 500 Index and pay floating rate based on 1-month LIBOR plus 0.200%. Broker: Morgan Stanley Exp. 07/06/2001 $ 32,704 $ 0 Receive total return on S&P 500 Index and pay floating rate based on 1-month LIBOR plus 0.300%. Broker: Lehman Brothers Exp. 07/31/2001 4,188 0 Receive total return on S&P 500 Index and pay floating rate based on 1-month LIBOR plus 0.250%. Broker: Morgan Stanley Exp. 10/03/2001 38,761 0 Receive total return on S&P 500 Index and pay floating rate based on 1-month LIBOR plus 0.320%. Broker: J.P. Morgan Exp. 03/20/2002 54,693 0 Receive total return on S&P 500 Index and pay floating rate based on 1 month LIBOR plus 0.180%. Broker: J.P. Morgan Exp. 04/30/2001 11,569 0 Receive a fixed rate equal to 1.290% and the Fund will pay to the counterparty at par in the event of default in of the United Mexican States at 9.750% due 04/06/2005. Broker: J.P. Morgan Exp. 06/19/2002 15,500 2 Receive a fixed rate equal to 0.400% and the Fund will pay to the counterparty at par in the event of default of Enron Corp. Bond. Broker: Morgan Stanley Exp. 06/16/2001 50,000 2 ------------ $ 4 ------------ (i) Securities are grouped by coupon or range of coupons and represent a range of maturities. (j) Restricted security. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 163 Schedule of Investments Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 105.2% -------------------------------------------------------------------------------- Arizona 4.1% Phoenix Industrial Development Authority Revenue Bonds, (GNMA/FNMA/FHLMC Insured), Series 2000-1A 5.875% due 06/01/2016 $ 1,000 $ 1,047 Pima County, Arizona Industrial Development Authority Multi-Family Revenue Bonds, (HUD SECT 8 Insured), Series 1998 5.375% due 06/01/2010 1,210 1,283 Scottsdale, Arizona Industrial Development Authority Hospital Revenue Bonds, (AMBAC Insured), Series 1997-A 6.500% due 09/01/2004 880 962 ------------ 3,292 ------------ California 12.2% Alameda, California Harbor Bay Business Park Assessment Revenue Bonds, Series 1998 5.000% due 09/02/2006 360 360 Capistrano, California Unified School District Special Tax Bonds, Series 1999 5.000% due 09/01/2008 350 356 Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, (MBIA-IBC), Series 1999 0.000% due 01/15/2026 (c) 1,565 1,054 Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, Series 1995 0.000% due 01/01/2026 (c) 1,000 272 Foothill Eastern Transportation Corridor Agency Toll Road Revenue Bonds, (MBIA Insured), Series 1999 0.000% due 01/15/2027 (c) 1,500 978 Irvine, California Special Assessment Bonds, (MBIA-IBC Insured), Series 1998 4.800% due 09/02/2004 150 151 4.900% due 09/02/2005 310 312 5.000% due 09/02/2006 150 151 Irvine, California Special Assessment Bonds, Series 1999 5.000% due 09/02/2005 350 352 5.100% due 09/02/2006 535 541 5.200% due 09/02/2007 255 258 Lake Elsinore, California School Refunding Bonds, Series 1998 5.000% due 09/01/2006 350 352 Los Angeles County, California Transportation Commission Sales Tax Revenue Refunding Bonds, Series 1991-B 6.500% due 07/01/2013 1,000 1,027 Los Angeles, California Community Redevelopment Agency Certificates of Participation Revenue Bonds, Series 1984 7.550% due 11/01/2008 1,075 1,199 Orange County, California Improvement Bonds, Series 1998-A 4.900% due 09/02/2005 245 246 Pittsburg, California Infrastructure Refunding Bonds, Series 1998-A 4.900% due 09/02/2003 150 154 5.000% due 09/02/2004 150 156 Riverside County, California Special Tax Refunding Bonds, Series 1999 4.200% due 09/01/2001 300 301 4.700% due 09/01/2005 170 171 Roseville, California Special Tax Bonds, Series 1999 5.000% due 09/01/2004 350 354 Sacramento County, California Refunding Bonds, Series 1998 4.900% due 09/02/2005 300 302 South Tahoe, California Joint Powers Financing Authority Revenue Bonds, Series 1999-A 7.300% due 10/01/2007 350 358 West Sacramento, California Refunding Bonds, Series 1998 5.000% due 09/02/2004 350 355 ------------ 9,760 ------------ Colorado 6.3% Arapahoe County, Colorado Capital Trust Fund Highway Revenue Bonds, (MBIA Insured), Series 1986 6.150% due 08/31/2026 1,500 1,607 Colorado Housing & Finance Authority Revenue Bonds, (FHA/VA Mortgages Insured), Series 2000-C3 5.700% due 10/01/2022 1,000 1,044 Colorado Housing & Finance Authority Revenue Bonds, Series 2000-D3 6.750% due 04/01/2015 250 280 Colorado Housing & Finance Authority Bonds, Series 2000-B3 6.700% due 10/01/2016 250 278 Colorado Housing & Financial Authority Revenue Bonds, Series 2000 5.150% due 08/01/2007 500 509 Denver, Colorado Health & Hospital Revenue Bonds, Series 1998-A 5.000% due 12/01/2009 1,390 1,310 ------------ 5,028 ------------ Florida 1.3% Gainesville, Florida Revenue Bonds, Series 1979 6.200% due 10/01/2002 210 213 Orange County, Florida Health Facilities Authority Revenue Bonds, (MBIA Insured), Series 1996 6.250% due 10/01/2011 290 335 Orlando, Florida Waste Water System Revenue Bonds, Series 1997-A 6.042% due 10/01/2015 (d) 500 477 ------------ 1,025 ------------ Georgia 0.3% Georgia Municipal Electric Authority Revenue Bonds, (MBIA-IBC Insured), Series 1997 6.500% due 01/01/2012 200 234 ------------ Hawaii 3.2% Hawaii State Housing Financial & Development Corporation Single Family Mortgage Pure Revenue Bonds, Series 1998 4.850% due 07/01/2029 1,500 1,509 Honolulu Hawaii City & County General Obligation Bonds, (MBIA-IBC), Series 1993 5.450% due 09/11/2008 1,000 1,085 ------------ 2,594 ------------ Illinois 8.7% Chicago, Illinois Board of Education General Obligation Bonds, (FGIC Insured), Series 1998 0.000% due 12/01/2020 1,000 352 Chicago, Illinois General Obligation Bonds, (MBIA Insured), Series 2001 0.000% due 01/01/2020 (c) 1,290 762 Chicago, Illinois Park District General Obligation Bonds, (FGIC Insured), Series 1999 4.750% due 01/01/2026 2,750 2,553 Fox Lake, Illinois Water & Sewer Revenue Bonds, (AMBAC Insured), Series 1996 5.750% due 05/01/2013 1,135 1,196 Illinois Educational Facilities Authority Revenues Bonds, Series 1993 5.610% due 07/01/2012 2,000 2,141 ------------ 7,004 ------------ 164 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Indiana 2.5% Indianapolis, Indiana Local Public Improvement Bonds Bank Transportation Revenue Bonds, Series 1992 6.750% due 02/01/2014 $ 1,000 $ 1,179 South Bend, Indiana Redevelopment Authority Lease Revenue Bonds, Series 2000 5.200% due 02/01/2012 230 238 5.500% due 02/01/2015 180 187 5.100% due 02/01/2011 405 420 ------------ 2,024 ------------ Kentucky 7.1% Kentucky State Turnpike Authority Economic Development Road Revenue Bonds, Series 1993 7.294% due 06/06/2012 5,000 5,668 ------------ Louisiana 0.3% Louisiana Local Government Revenue Bonds, (MBIA Insured), Series 2000 5.700% due 01/01/2010 250 268 ------------ Massachusetts 3.2% Massachusetts Housing Finance Agency Revenue Bonds, (AMBAC Insured), Series 1993 5.950% due 10/01/2008 1,500 1,569 Massachusetts State Development Finance Agency Revenue Bonds, (ACA Insured), Series 1999 4.600% due 03/01/2009 400 393 Massachusetts State Development Finance Agency Revenue Bonds, Series 1998 4.700% due 11/01/2007 210 213 4.800% due 11/01/2008 90 91 Massachusetts State Health Facilities Authority Revenue Bonds, Series 1993 5.500% due 10/01/2002 270 265 ------------ 2,531 ------------ Michigan 2.3% Michigan State Environmental Protection General Obligation Bonds, Series 1992 6.250% due 11/01/2012 1,100 1,286 University of Michigan Revenue Bonds, Series 1995 3.750% due 12/01/2027 600 600 ------------ 1,886 ------------ Minnesota 1.3% New Richland, Minnesota Revenue Bonds, Series 1998 4.500% due 08/01/2004 1,000 1,017 ------------ Nevada 0.6% Nevada State General Obligation Bonds, (FGIC Insured), Series 2001 6.690% due 05/15/2028 500 467 ------------ New Hampshire 3.7% New Hampshire Health & Educational Facilities Authority Revenue Bonds, (AMBAC Insured), Series 2002 5.125% due 07/01/2016 2,980 2,969 ------------ New Jersey 20.7% New Jersey Economic Development Authority Revenue Bonds, Series 1998 5.600% due 01/01/2012 1,000 892 0.010% due 04/01/2013 1,595 744 6.375% due 04/01/2018 1,500 1,530 6.375% due 04/01/2031 7,000 7,089 New Jersey Economic Development Authority Revenue Bonds, Series 1999 6.625% due 09/15/2012 3,500 3,650 New Jersey State Highway Authority Gadern Street Parkway General Revenue Bonds, (FGIC Insured), Series 2001 5.500% due 01/01/2015 2,500 2,670 ------------ 16,575 ------------ New Mexico 0.4% Santa Fe County, New Mexico El Castillo Retirement Nursing Home Bonds, Series 1998-A 5.250% due 05/15/2007 315 293 ------------ New York 2.6% Nassau County, New York Tobacco Settlement Corp. Revenue Bonds, Series 1999 5.250% due 07/15/2011 1,000 1,011 New York State Dormitory Authority Revenue Bonds, (ACA Insured), Series 2000 5.850% due 07/01/2010 1,000 1,047 ------------ 2,058 ------------ North Dakota 2.6% Mercer County North Dakota Pollution Control Revenue Bonds, Series 1991 6.900% due 02/01/2019 2,000 2,057 ------------ Pennsylvania 0.1% Delaware County, Pennsylvania Hospital Revenue Bonds, Series 1998 4.900% due 12/01/2008 100 93 ------------ Puerto Rico 1.2% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 5.750% due 07/01/2010 750 813 6.000% due 07/01/2026 150 156 ------------ 969 ------------ South Carolina 3.5% Medical University South Carolina Hospital Facilities Revenue Bonds, Series 1999 5.700% due 07/01/2012 1,000 1,022 South Carolina State Public Service Authority Revenue Bonds, Series 1993 6.838% due 06/28/2013 1,700 1,820 ------------ 2,842 ------------ Tennessee 2.3% Nashville & Davidson County, Tennessee Revenue Bonds, Series 1998 4.450% due 08/01/2007 1,000 1,014 Sullivan County, Tennessee Industrial Development Revenue Bonds, (GNMA Insured), Series 1995 6.250% due 07/20/2015 750 797 ------------ 1,811 ------------ Texas 12.0% Bexar, Texas Metro Water District Waterworks System Revenue Bonds, (MBIA Insured), Series 1998 0.000% due 05/01/2035 2,190 339 Brazos River Authority Texas Revenue Bonds, (MBIA Insured), Series 1998 4.900% due 10/01/2015 1,500 1,517 Dallas-Fort Worth International Airport Facility Improvement Corp. Revenue Bonds, Series 2000 5.950% due 05/01/2029 1,000 1,021 Del Rio Texas Waterworks & Sewer System Revenue Bonds, (MBIA Insured), Series 1993 5.500% due 06/01/2015 2,400 2,436 Houston Independent School District General Obligation Ltd Bonds, (PSF Insured), Series 1999 4.750% due 02/15/2026 1,000 915 Katy, Texas Independent School District General Obligation Ltd Bonds, (PSF-GTD Insured), Series 1998 4.750% due 02/15/2024 1,500 1,384 Lamar, Texas Independent School District General Obligation Bonds, (PSF-GTD Insured), Series 1998 4.750% due 02/15/2020 1,750 1,659 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 165 Schedule of Investments (Cont.) Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Midlothian, Texas Independent School District General Obligation Bonds, (PSF-GTD Insured), Series 1999 0.010% due 02/15/2018 $ 1,000 $ 365 ------------ 9,636 ------------ Washington, DC 1.1% District of Columbia General Obligation Bonds, (LOC-Bank of America), Series 1991 3.850% due 06/01/2003 900 900 ------------ West Virginia 1.6% West Virginia State Parkways Economic Development & Tourism Authority Revenue Bonds, (FGIC Insured), Series 1993 7.839% due 05/16/2019 1,200 1,265 ------------ Total Municipal Bonds & Notes 84,266 (Cost $81,840) ------------ -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.1% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (b) 3.625% due 07/15/2002 109 111 ------------ Total U.S. Treasury Obligations 111 (Cost $109) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 0.6% -------------------------------------------------------------------------------- Money Market Fund 0.4% SSgA Tax Free Money Market 3.080% due 04/02/2001 334 334 U.S. Treasury Bills 0.2% 4.862% due 05/17/2001 140 139 ------------ Total Short-Term Instruments 473 (Cost $473) ------------ Total Investments (a) 105.9% $ 84,850 (Cost $82,422) Other Assets and Liabilities (Net) (5.9%) (4,714) ------------ Net Assets 100.0% $ 80,136 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $82,422 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 2,763 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (335) ------------ Unrealized appreciation-net $ 2,428 ------------ (b) Principal amount of the security is adjusted for inflation. (c) Security becomes interest bearing at a future date. (d) Variable rate security. The rate listed is as of March 31, 2001. 166 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments Short Duration Municipal Income Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 95.6% -------------------------------------------------------------------------------- Alaska 2.9% Valdez, Alaska Marine Term Ref-Exxon Pipeline Co. Revenue Bonds, Series 1993 3.700% due 12/01/2033 $ 400 $ 400 ------------ Arizona 3.7% Maricopa County, Arizona Pollution Central Revenue Bonds, Series 1994 3.700% due 05/01/2029 500 500 ------------ California 7.7% East Bay, California Municipal Utility Water System Revenue, Series 1993 5.200% due 06/01/2008 1,000 1,048 ------------ Colorado 5.6% Arapahoe County, Colorado Capital Trust Fund Highway Revenue Bonds, (MBIA Insured), Series 1986 6.150% due 08/31/2026 250 268 Denver, Colorado Health & Hospital Revenue Bonds, Series 1998-A 5.000% due 12/01/2002 500 502 ------------ 770 ------------ Florida 14.6% Atlantic Beach, Florida Health Care Revenue Bonds, (ACA Insured), Series 1999 5.000% 500 502 due 10/01/2001 Dade County, Florida Health Facilities Authority Hospital Revenue Bonds, Series 1990 3.750% due 09/01/2020 300 300 Gulf Breeze Florida Revenue Bonds, (MBIA Insured), Series 1997 4.372% due 12/01/2017 (b) 500 479 Orlando, Florida Waste Water System Revenue Bonds, Series 1997-A 6.112% due 10/01/2015 (b) 750 716 ------------ 1,997 ------------ Hawaii 8.9% Hawaii Airport Systems Revenue Bonds, (MBIA Insured), Series 1991 6.600% due 07/01/2004 500 513 Hawaii State General Obligation Bonds, Series 1993 5.500% due 07/01/2001 500 503 Hawaii State Housing Finance & Development Corp. Revenue Bonds, (FNMA Insured), Series 1998 4.250% due 07/01/2001 195 195 ------------ 1,211 ------------ Illinois 2.4% Illinois Educational Facilities Authority Revenues, Series 1993 5.610% due 07/01/2012 300 321 ------------ Kansas 3.7% Burlington, Kansas Pollution Control Revenue Bonds, (MBIA Insured), Series 1991 7.000% due 06/01/2031 500 512 ------------ Maine 4.0% Eastport, Maine Industrial Development Revenue Bonds, (LOC-Wachovia Bank), Series 1989 4.750% due 11/15/2001 250 251 5.100% due 11/15/2003 300 301 ------------ 552 ------------ Massachusetts 3.4% Massachusetts Housing Finance Agency Revenue Bonds, (AMBAC Insured), Series 1993 5.950% due 10/01/2008 250 262 Massachusetts State Health & Educational Facilities Authority Revenue Bonds, Series 1985 3.700% due 01/01/2035 200 200 ------------ 462 ------------ Missouri 5.1% Missouri State Housing Development Community Mortgage Revenue Bonds, (GNMA/FNMA Insured), Series 1996 7.100% due 09/01/2027 175 192 St. Louis, Missouri Airport Revenue Bonds, Series 2000 6.250% due 01/01/2002 500 508 ------------ 700 ------------ Nevada 3.6% Carson City, Nevada School District General Obligation Bond, (FGIC Insured), Series 1990 6.600% due 04/01/2001 485 485 ------------ New Jersey 11.2% New Jersey Economic Development Authority Revenue Bonds, Series 1998 6.375% due 04/01/2018 500 510 6.375% due 04/01/2031 1,000 1,013 ------------ 1,523 ------------ New York 3.7% New York State Dormitory Authority Revenue Bonds, (MBIA Insured), Series 1999 4.300% due 07/01/2002 500 506 ------------ Pennsylvania 3.7% Dauphin County, Pennsylvania General Authority Bond, (AMBAC Insured), Series 1997 4.450% due 09/01/2032 500 503 ------------ Puerto Rico 2.0% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 5.750% due 07/01/2010 250 271 ------------ Rhode Island 3.8% Convention Center Authority Rhode Island Revenue Bonds, (MBIA Insured), Series 1991 6.700% due 05/15/2020 500 512 ------------ Texas 3.7% Dallas-Fort Worth International Airport Facility Improvement Corp. Revenue Bonds, Series 2000 5.950% due 05/01/2029 500 510 ------------ Utah 0.8% Carbon County, Utah Pollution Central Revenue Bonds, Series 1994 3.750% due 11/01/2024 115 115 ------------ Wisconsin 1.1% Oshkosh Water Revenue Bonds, Series 1999 4.700% due 01/01/20 150 151 ------------ Total Municipal Bonds & Notes 13,049 (Cost $12,861) ------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 167 Schedule of Investments (Cont.) Short Duration Municipal Income Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 0.2% -------------------------------------------------------------------------------- Money Market Fund 0.1% SSgA Tax Free Money Market 3.080% due 04/02/2001 $ 17 $ 17 ------------ U.S. Treasury Bills 0.1% 4.890% due 05/17/2001 10 10 ------------ Total Short-Term Instruments 27 (Cost $27) ------------ Total Investments (a) 95.8% $ 13,076 (Cost $12,888) Other Assets and Liabilities (Net) 4.2% 580 ------------ Net Assets 100.0% $ 13,656 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $12,888 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 203 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (15) ------------ Unrealized appreciation-net $ 188 ------------ (b) Variable rate security. The rate listed is as of March 31, 2001. 168 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Schedule of Investments California Intermediate Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 100.4% -------------------------------------------------------------------------------- California 75.1% A B C California Unified School District General Obligation, (FGIC Insured), Series 2000 0.000% due 08/01/2029 $ 1,715 $ 384 A B C California Unified School District General Obligation, (FGIC Insured), Series 2001 0.000% due 08/01/2026 1,600 422 0.000% due 08/01/2027 1,145 286 0.000% due 08/01/2028 1,310 310 0.000% due 08/01/2030 1,850 390 0.000% due 08/01/2031 1,285 257 0.000% due 08/01/2032 1,965 373 0.000% due 08/01/2033 1,670 300 0.000% due 08/01/2034 1,755 299 Alameda, California Harbor Bay Business Park Assessment Revenue Bonds, Series 1998 5.500% due 09/02/2012 3,500 3,506 Anaheim, California Public Financing Authority Revenue Bonds, (AMBAC Insured), Series 1999 4.625% due 10/01/2027 150 157 Antioch, California Public Financing Authority Reassessment Revenue Bonds, Series 1998-B 5.500% due 09/02/2008 495 509 California Educational Facilities Authority Revenue Bonds, Series 1997-A 5.700% due 135 146 10/01/2015 California Health Facilities Financing Authority Revenue Bonds, (CA MTG Insured), Series 2000 5.000% due 09/01/2010 350 366 California Health Facilities Financing Authority Revenue Bonds, (MBIA Insured), Series 1998-A 5.375% due 08/15/2030 1,100 1,117 California Health Facilities Financing Authority Revenue Bonds, Series 1998-B 5.250% due 10/01/2014 3,000 3,025 California Housing Financial Agency Revenue Bonds, (AMBAC FHA Insured),Series 1996 5.950% due 02/01/2011 100 108 California Pollution Central Financing Authority Revenue Bonds, (MBIA Insured), Series 1996 5.350% due 12/01/2016 1,000 1,013 California Pollution Control Financing Authority Revenue Bonds, Series 1999-A 4.500% due 08/01/2003 150 152 California State Department of Water Resources Central Valley Project Revenue Bonds, Series 1993 5.700% due 12/01/2016 1,750 1,829 California State Department Veteran Affairs Home Revenue Bonds, Series 2000-B 4.900% due 12/01/2005 500 507 California State General Obligation Bonds, (FGIC Insured), Series 1997 5.000% due 10/01/2004 325 343 California State General Obligation Bonds, (MBIA Insured), Series 1991 6.600% due 02/01/2011 1,000 1,187 California State General Obligation Bonds, (MBIA Insured), Series 1992 7.500% due 10/01/2007 400 482 California State General Obligation Bonds, Series 1991 6.500% due 09/01/2010 1,730 2,037 California State General Obligation Bonds, Series 1997-BL 5.300% due 12/01/2012 400 421 California State General Obligation Bonds, Series 2000 5.250% due 03/01/2005 100 106 5.250% due 03/01/2013 300 318 5.700% due 12/01/2032 1,775 1,811 6.310% due 01/01/2027 (d) 1,500 1,435 California State General Obligation Bonds, Series 2001 5.500% due 03/01/2012 2,000 2,183 5.125% due 03/01/2031 500 497 California State Public Works Board Lease Revenue Bonds, Series 1994-A 6.375% due 11/01/2014 500 560 California Statewide Communities Development Authority Apartment Development Revenue Bonds, Series 1998-A-3 5.100% due 05/15/2025 2,000 2,010 California Statewide Communities Development Authority Certificates of Participation, (AMBAC Insured), Series 1995 3.600% due 07/01/2015 (d) 1,100 1,100 California Statewide Communities Development Authority Certificates of Participation, Series 1994 6.500% due 07/01/2015 1,000 1,115 California Statewide Communities Development Authority Revenue Bonds, Series 2001 5.125% due 10/01/2030 1,950 1,925 Capistrano, California Unified School District Community Facilities District Special Tax Bonds, Series 1997 7.100% due 09/01/2021 2,000 2,357 Capistrano, California Unified School District Community Facilities District Special Tax Bonds, Series 1999 5.700% due 09/01/2020 1,500 1,483 Chico, California Public Financing Authority Revenue Bonds, (FSA Insured), Series 1996 5.200% due 04/01/2011 485 512 Chula Vista, California Special Tax Bonds, Series 2000-1 6.350% due 09/01/2017 230 239 6.400% due 09/01/2018 120 124 Corona, California Community Facilities District Special Tax Bonds, Series 1998 5.875% due 09/01/2023 1,000 996 East Bay, California Municipal District Wastewater Treatment System Revenue, Series 1993 5.550% due 06/01/2020 (d) 6,000 6,328 East Bay, California Municipal Utility District Wastewater Treatment System Revenue Bonds, (AMBAC Insured), Series 1993 6.420% due 06/01/2013 3,450 3,749 East Bay, California Regional Park District General Obligation Bonds, Series 1998 5.000% due 09/01/2017 2,000 2,025 Evergreen, California School District General Obligation Bonds, (FGIC Insured), Series 2000-C 10.000% due 09/01/2005 465 586 10.000% due 09/01/2006 380 497 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 169 Schedule of Investments (Cont.) California Intermediate Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, Series 1995 0.000% due 01/01/2026 $ 1,000 $ 272 Foothill Eastern Transportation Corridor Agency Toll Road Revenue Bonds, (MBIA Insured), Series 1999 5.875% due 01/15/2027 2,500 1,630 Fresno, California Special Tax, Series 1998 4.750% due 09/01/2005 980 983 Livermore Valley, California Joint Unified School District General Obligation Bonds, (MBIA Insured), Series 2000 6.500% due 08/01/2003 1,000 1,073 Livermore-Amador Water Management Agency California Revenue Bonds, (AMBAC Insured), Series 2001 5.000% due 08/01/2031 3,500 3,441 Long Beach, California Harbor Revenue Bonds, (MBIA Insured), Series 1995 6.500% due 220 243 05/15/2005 Long Beach, California Harbor Revenue Bonds, Series 1993 4.700% due 05/15/2004 150 155 Los Angeles County, California Transportation Commission Certificates of Participation, Series 1992-B 6.250% due 07/01/2004 500 527 Los Angeles, California Community Redevelopment Agency Certificates of Participation Revenue Bonds, Series 1984 7.550% due 11/01/2008 390 435 Los Angeles, California State Building Authority Lease Revenue Bonds, Series 1999-A 4.600% due 10/01/2007 150 157 Los Angeles, California Unified School District General Obligation Bonds, (MBIA Insured), Series 1999-C 4.750% due 07/01/2010 30 32 Metropolitan Water District Southern California General Obligation Bonds, Series 1993-A1 7.250% due 03/01/2007 150 177 Metropolitan Water District Southern California Revenue Bonds, Series 1993 6.050% due 10/30/2020 (d) 600 623 Orange County, California Community Facilities District Special Tax, Series 2000 5.600% due 08/15/2011 455 460 5.700% due 08/15/2012 485 490 5.800% due 08/15/2013 600 604 6.200% due 08/15/2018 1,025 1,033 Orange County, California Local Transportation Authority Sales Tax Revenue Bonds, (AMBAC-TCRS Insured), Series 1992 6.200% due 02/14/2011 3,250 3,816 Orange County, California Revenue Bonds, (MBIA Insured), Series 1995-A 6.000% due 06/01/2010 1,000 1,148 Oxnard, California Improvement Bond Act 1915 Special Assessment, Series 1997 5.500% due 09/02/2004 1,205 1,232 Pacific Housing & Finance Agency, California Revenue Bonds, (MBIA Insured), Series 1999 4.625% due 12/01/2004 250 259 Pioneers Memorial Healthcare District, California General Obligation Bonds, (AMBAC Insured), Series 1998 5.125% due 10/01/2024 1,000 999 Port of Oakland, California Revenue Bonds, (FGIC Insured), Series 2000 5.500% due 11/01/2009 500 546 Rancho, California Water District Financing Authority Revenue Bonds, (FGIC Insured), Series 1995 5.875% due 11/01/2010 900 989 Redding, California Electric System Revenue Certificates of Participation, (FGIC Insured), Series 1993 5.684% due 06/28/2019 500 516 Riverside County, California Asset Leasing Corp. Revenue Bonds, (MBIA Insured), Series 2000 5.200% due 11/01/2010 250 273 Sacramento County, California Sanitation District Financing Authority Revenue Bonds, Series 2000-A 4.900% due 12/01/2007 1,000 1,068 5.100% due 12/01/2009 1,000 1,082 5.100% due 12/01/2010 1,000 1,083 Sacramento, California Municipal Utility District Electric Revenue, Series 1993 5.300% due 2,500 2,649 11/15/2005 Sacramento, California Municipal Utility District Revenue Bonds, Series 1983-M 9.000% due 04/01/2013 960 1,287 San Francisco, California City & County Airport Commission International Airport Revenue Bonds, (FGIC Insured), Series 1996-12-A 5.625% due 05/01/2005 400 428 San Francisco, California City & County Airport Commission International Airport Revenue Bonds, (FSA Insured), Series 1998-16A 5.500% due 05/01/2015 300 315 San Francisco, California City & County Airport Commission International Airport Revenue Bonds, (MBIA Insured), Series 1996-14A 8.000% due 05/01/2005 500 578 San Francisco, California City & County Airport Common International Airport Revenue Bonds, Series 1998 4.500% due 05/01/2026 1,750 1,584 San Jose, California Multifamily Housing Revenue Bonds, (LOC-Bay View Bank N.A. & LOC-Federal Home Loan Bank Insured), Series 1999 4.950% due 06/01/2039 1,000 1,046 San Jose, California Redevelopment Agency Tax Allocation, (MBIA Insured), Series 1993 6.000% due 08/01/2010 600 690 San Pablo, California Redevelopment Agency Revenue Bonds, Series 1979 8.000% due 135 160 10/01/2011 Santa Margarita/Dana Point Authority, California Revenue Bonds, (MBIA Insured), Series 1994-A 7.250% due 08/01/2006 150 176 South Tahoe, California Joint Powers Financing Authority Revenue Bonds, Series 1999-A 7.300% due 10/01/2007 150 154 Stockton, California Certificates of Participation, Series 1999 4.750% due 08/01/2006 120 125 West Sacramento California Import Bridge Act 1915, Series 1998 4.800% due 09/02/2002 1,160 1,166 Western Riverside County, California Regional Wastewater Authority Revenue Bonds, (LOC-Dexia Credit Local France), Series 1996 3.600% due 04/01/2028 1,400 1,400 ------------- 88,986 ------------- 170 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Illinois 1.3% Illinois Educational Facilities Authority Revenues, Series 1993 1.000% due 07/01/2012 $ 1,400 $ 1,499 ------------ New Hampshire 2.3% New Hampshire Health & Educational Facilities Authority Revenue Bonds, (AMBAC Insured), Series 2002 5.250% due 07/01/2014 2,690 2,748 ------------ Puerto Rico 17.7% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 5.750% due 07/01/2020 5,000 5,182 Puerto Rico Commonwealth Aqueduct & Sewer Authority Revenue Bonds, (FSA Surety Bond Insured), Series 1985-A 9.000% due 07/01/2009 3,000 3,497 Puerto Rico Commonwealth General Obligation Bonds, (MBIA Insured), Series 1995 5.200% due 410 441 07/01/2006 Puerto Rico Commonwealth Highway & Transportation Authority Revenue Bonds, Series 1993-X 5.200% due 07/01/2003 500 518 5.350% due 07/01/2005 5,000 5,233 Puerto Rico Commonwealth Infrastructure Financing Authority Revenue Bonds, (AMBAC Insured), Series 1998-A 5.250% due 07/01/2010 150 163 Puerto Rico Electric Power Authority Power Revenue Bonds, Series 1995-X 6.125% due 07/01/2021 500 559 Puerto Rico Industrial Tourist Educational, Medical & Environmental Control Facilities Revenue Bonds, Series 2000 5.300% due 11/15/2005 250 260 Puerto Rico Industrial Tourist Environmental Central Facilities Revenue Bonds, Series 2000 5.300% due 11/15/2004 150 155 Puerto Rico Municipal Finance Agency General Obligation Bonds, (FSA Insured), Series 1999-A 5.000% due 08/01/2004 1,000 1,050 Puerto Rico Public Finance Corp. Revenue Bonds, (AMBAC Insured), Series 1998-A 5.000% 500 535 due 06/01/2007 University of Puerto Rico Revenues Bonds, (MBIA Insured), Series 1995 6.250% due 3,000 3,368 06/01/2006 ------------- 20,961 ------------- Virgin Islands 4.0% Virgin Islands Public Finance Authority Revenue Bonds, Series 1998-C 5.500% due 10/01/2008 3,000 3,197 5.500% due 10/01/2007 1,500 1,599 4,796 Total Municipal Bonds & Notes 118,990 (Cost $113,888) -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.2% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities 3.625% due 07/15/2002 (b)(c) 219 223 ------------- Total U.S. Treasury Obligations 223 (Cost $219) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 0.2% -------------------------------------------------------------------------------- Money Market Fund 0.2% Reich & Tang California Money Market 2.630% due 04/02/2001 267 267 ------------- Total Short-Term Instruments 267 (Cost $267) ------------- Total Investments (a) 100.8% $ 119,480 (Cost $114,374) Other Assets and Liabilities (1,016) (Net) (0.8%) ------------- Net Assets 100.0% $ 118,464 ------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $114,374 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 5,137 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (31) ------------- Unrealized appreciation-net $ 5,106 ------------- (b) Securities with an aggregate market value of $223 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts Appreciation -------------------------------------------------------------------------------- U.S. Treasury 30 Year Bond 50 $ 92 (06/2001) ------------- (c) Principal amount of the security is adjusted for inflation. (d) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 171 Schedule of Investments California Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 95.6% -------------------------------------------------------------------------------- California 65.3% California Health Facilities Financing Authority Revenue Bonds, Series 1998 3.800% due 09/01/2028 $ 100 $ 100 California Pollution Control Financing Authority Revenue Bonds, Series 1991 3.600% due 10/01/2011 (d) 300 300 California State Department Water Center Revenue Bonds, Series 1993 8.375% due 12/01/2003 150 169 California State General Obligation, Series 2001 5.125% due 03/01/2031 625 621 California Statewide Communities Development Authority Revenue Bonds, Series 2001 5.125% due 10/01/2030 400 395 Capistrano, California Unified School District Community Facilities District Special Tax Bonds, Series 1999 5.700% due 09/01/2020 400 395 Chula Vista, California Special Tax Bonds, Series 2000-1 6.400% due 09/01/2018 125 130 Corona, California Community Facilities District Special Tax Bonds, Series 1998 5.875% 150 149 due 09/01/2023 East Bay, California Municipal Utility District Wastewater Treatment System Revenue Bonds, (AMBAC Insured), Series 1993 6.420% due 06/01/2013 (d) 400 435 Foothill Eastern Transportation Corridor Agency Toll Road Revenue Bonds, (MBIA Insured), Series 1999 0.000% due 01/15/2027 500 326 Irvine Ranch California Water District Certificate Participation, (LOC-Toronto Dominio Bank Insured), Series 1986 3.600% due 08/01/2016 (d) 300 300 Livermore-Amador Water Management Agency California Revenue Bonds, (AMBAC Insured), Series 2001 5.000% due 08/01/2031 200 197 Los Angeles County, California Transportation Commission Certificates of Participation, Series 1992-B 6.250% due 07/01/2004 500 527 Los Angeles County, Caliifornia Metropolitan Transportation Authority Sales Tax Revenue Bonds, Series 1999 4.750% due 07/01/2026 500 472 Los Angeles, California Department of Water & Power Waterworks Revenue Bonds, (MBIA Insured), Series 1994 6.375% due 07/01/2034 350 387 Metropolitan Water District Southern California Revenue Bonds, Series 1993 6.370% due 10/30/2020 (d) 200 207 Orange County, California Local Transportation Authority Sales Tax Revenue Bonds, (AMBAC-TCRS Insured), Series 1992 6.200% due 02/14/2011 750 881 Orange County, California Revenue Bonds, (MBIA Insured), Series 1995-A 6.000% due 06/01/2010 400 459 Orange County, California Santa Ana District Certificate Participation, (SPA-DEXIA Public Finance Insured), Series 2000 3.600% due 08/01/2030 (d) 400 400 Pioneers Memorial Healthcare District, California General Obligation Bonds, (AMBAC Insured), Series 1998 5.125% due 10/01/2024 400 400 San Francisco, California City & County Airport Common International Airport Revenue Bonds, Series 1998 4.500% due 05/01/2026 500 453 San Jose, California Redevelopment Agency Tax Allocation, (MBIA Insured), Series 1993 6.000% due 300 345 08/01/2010 Southern California Public Power Authority Revenue Bonds, (FSA-CR Insured), Series 1993 5.000% due 110 112 07/01/2015 Tustin, California Import Bridge Act 1915 Special Assessment, (LOC- KBC Bank Insured), Series 1996 3.600% due 09/02/2013 (d) 100 100 ------------- 8,260 ------------- New Jersey 4.4% New Jersey Economic Development Authority Revenue Bonds, Series 1998 6.375% due 04/01/2031 555 562 ------------- Puerto Rico 22.5% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 5.750% due 07/01/2020 500 518 Puerto Rico Commonwealth Aqueduct & Sewer Authority Revenue Bonds, (FSA Surety Bond Insured), Series 1985-A 9.000% due 07/01/2009 2,000 2,332 ------------- 2,850 ------------- Virgin Islands 3.4% Virgin Islands Public Finance Authority Revenue Bonds, Series 1998-C 5.500% due 10/01/2008 405 432 ------------- Total Municipal Bonds & Notes 12,104 (Cost $11,670) ------------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.9% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities 3.625% due 07/15/2002 (b)(c) 109 111 ------------- Total U.S. Treasury Obligations 111 (Cost $109) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 0.8% -------------------------------------------------------------------------------- Money Market Fund 0.8% Reich & Tang California Money Market 2.630% due 04/02/2001 105 105 ------------- Total Short-Term Instruments 105 (Cost $105) ------------- Total Investments (a) 97.3% $ 12,320 (Cost $11,884) Other Assets and Liabilities (Net) 2.7% 337 ------------- Net Assets 100.0% $ 12,657 ------------- 172 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $11,883 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 439 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (2) ----------- Unrealized appreciation-net $ 437 ----------- (b) Securities with an aggregate market value of $109 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contract (Depreciation) -------------------------------------------------------------------------------- Municipal Bond CBT (06/2001) 9 $ (8) ----------- (c) Principal amount of the security is adjusted for inflation. (d) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 173 Schedule of Investments New York Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 90.0% -------------------------------------------------------------------------------- New Jersey 21.2% New Jersey Economic Development Authority Revenue Bonds, Series 1998 6.375% due 04/01/2031 $ 850 $ 861 ------------ New York 66.2% Amherst, New York General Obligation, (FGIC Insured), Series 1999-A 5.500% due 12/01/2008 150 164 Edmeston, New York Central School District General Obligation, (MBIA Insured), Series 1999 5.100% due 06/15/2007 150 160 Long Island Power Authority Revenue Bonds, Series 1998 3.750% due 05/01/2033 200 200 Nassau County, New York Individual Development Agency Civic Facilities Revenue Bonds, (LOC-Morgan Guaranty Trust), Series 1998 3.850% due 03/01/2028 (b) 100 100 Nassau County, New York Tobacco Settlement Corp. Revenue Bonds, Series 1999 5.250% 150 152 due 07/15/2011 New York City, New York Individual Development Agency Special Facilities Revenue Bonds, Series 1998 5.250% due 12/01/2032 400 364 New York City, New York Individual Development Individual Development Revenue Bonds, Series 1997 5.650% due 10/01/2028 150 137 New York General Obligation, Series 1997-D 5.250% due 08/01/2021 100 101 New York State Dormitory Authority Revenue Bonds, (AMBAC Insured), Series 1998 5.000% due 07/01/2002 150 153 4.750% due 08/01/2027 150 138 New York State Dormitory Authority Revenue Bonds, (FSA Insured), Series 1998 4.750% 150 157 due 07/01/2008 New York State Dormitory Authority Revenue Bonds, Series 2000 6.000% due 07/01/2010 150 162 New York State Local Government Assistance Corp. Revenue Bonds, (MBIA Insured), Series 1997-B 5.125% due 04/01/2013 150 156 New York State Power Authority Revenue & General Purpose, Series 1972-E 5.500% due 125 133 01/01/2010 New York State Urban Development Corp. Revenue Bonds, Series 1999 5.000% 150 156 due 01/01/2005 Rockland County, New York Solid Waste Management Authority Revenue Bonds, Series 1999-A 4.800% due 12/15/2005 145 150 Suffolk County, New York Individual Development Agency Research Facility Revenue Bonds, (LOC-Morgan Guaranty Trust), Series 1993 3.950% due 07/01/2023 (b) 100 100 ------------ 2,683 ------------ Puerto Rico 2.6% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 6.000% due 07/01/2026 100 104 ------------ Total Municipal Bonds & Notes 3,648 (Cost $3,534) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 8.1% -------------------------------------------------------------------------------- Money Market Fund 7.7% Reich & Tang New York Money Market 2.900% due 04/02/2001 201 201 SSgA Tax Free Money Market 3.080% due 04/02/2001 109 109 ------------ 310 ------------ U.S. Treasury Bills 0.4% 4.890% due 05/17/2001 15 15 ------------ Total Short-Term Instruments 325 (Cost $325) ------------ Total Investments (a) 98.1% $ 3,973 (Cost $3,859) Other Assets and Liabilities (Net) 1.9% 79 ------------ Net Assets 100.0% $ 4,052 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $3,859 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 114 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. 0 ------------ Unrealized appreciation-net $ 114 ------------ (b) Variable rate security. The rate listed is as of March 31, 2001. 174 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Notes to Financial Statements March 31, 2001 1. Organization PIMCO Funds: Pacific Investment Management Series (the "Trust") was established as a Massachusetts business trust on February 19, 1987. The Trust is registered under the Investment Company Act of 1940 (the "Act"), as amended, as an open-end investment management company. The Trust currently consists of 39 separate investment funds (the "Funds"). The Trust may offer up to six classes of shares: Institutional, Administrative, A, B, C and D. Each share class has identical voting rights (except that shareholders of a class have exclusive voting rights regarding any matter relating solely to that class of shares). The Long Duration Fund had not commenced operations as of March 31, 2001. Information presented in these financial statements pertains to the Institutional and Administrative Classes (the "Institutional Classes") of the Trust. Certain detailed financial information for the A, B, C and D Classes (the "Other Classes") is provided separately and is available upon request. 2. Significant Accounting Policies The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America. The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America 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. Security Valuation. Portfolio securities and other financial instruments for which market quotations are readily available are stated at market value. Market value is determined on the basis of last reported sales prices, or if no sales are reported, as is the case for most securities traded over-the-counter, the mean between representative bid and asked quotations obtained from a quotation reporting system or from established market makers. Fixed income securities, including those to be purchased under firm commitment agreements, are normally valued on the basis of quotes obtained from brokers and dealers or pricing services. Short-term investments which mature in 60 days or less are valued at amortized cost, which approximates market value. Certain fixed income securities for which daily market quotations are not readily available may be valued, pursuant to guidelines established by the Board of Trustees, with reference to fixed income securities whose prices are more readily obtainable. Securities Transactions and Investment Income. Securities transactions are recorded as of the trade date. Securities purchased or sold on a when-issued or delayed-delivery basis may be settled a month or more after the trade date. Realized gains and losses from securities sold are recorded on the identified cost basis. Dividend income is recorded on the ex-dividend date, except certain dividends from foreign securities where the ex-dividend date may have passed, are recorded as soon as the Fund is informed of the ex-dividend date. Interest income, adjusted for the accretion of discounts and amortization of premiums, is recorded on the accrual basis. Dividends and Distributions to Shareholders. Dividends from net investment income, if any, of each Fund, except the Strategic Balanced, Convertible and StocksPLUS Funds, are declared on each day the Trust is open for business and are distributed to shareholders monthly. Dividends from net investment income, if any, of the Strategic Balanced, Convertible, European Convertible and StocksPLUS Funds are declared and distributed to shareholders quarterly. Net realized capital gains earned by a Fund, if any, will be distributed no less frequently than once each year. Income dividends and capital gain distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for such items as wash sales, foreign currency transactions, net operating losses and capital loss carryforwards. Distributions reflected as a tax basis return of capital in the accompanying Statements of Changes in Net Assets have been reclassified to paid in capital. In addition, other amounts have been reclassified between undistributed net investment income, accumulated undistributed net realized gains or losses and paid in capital to more appropriately conform financial accounting to tax characterizations of dividends and distributions. Foreign Currency. Foreign currencies, investments, and other assets and liabilities are translated into U.S. dollars at the exchange rates prevailing at the end of the period. Fluctuations in the value of these assets and liabilities resulting from changes in exchange rates are recorded as unrealized foreign currency gains (losses). Realized gains (losses) and unrealized appreciation (depreciation) on investment securities and income and expenses are translated on the respective dates of such transactions. The effect of changes in foreign currency exchange rates on investments in securities are not segregated in the Statements of Operations from the effects of changes in market prices of those securities, but are included with the net realized and unrealized gain or loss on investment securities. Multiclass Operations. Each class offered by the Trust has equal rights as to assets and voting privileges. Income and non-class specific expenses of each Fund, except the Strategic Balanced, Convertible, European Convertible and StocksPLUS Funds, are allocated daily to each class of shares based on the relative value of settled shares. Income and non-class specific expenses of the Strategic Balanced, Convertible and StocksPLUS Funds are allocated daily to each class of shares based on the relative net assets of each class. Realized and unrealized capital gains and losses of each Fund are allocated daily to each class of shares based on the relative net assets of each class. Federal Income Taxes. Each Fund intends to qualify as a regulated investment company and distribute all of its taxable income and net realized gains, if applicable, to shareholders. Accordingly, no provision for Federal income taxes has been made. 3.31.01 | PIMCO Funds Annual Report 175 Notes to Financial Statements (Cont.) March 31, 2001 Financing Transactions. Certain Funds may enter into financing transactions consisting of the sale by the Fund of securities, together with a commitment to repurchase similar securities at a future date. The difference between the selling price and the future purchase price is an adjustment to interest income. If the counterparty to whom the Fund sells the security becomes insolvent, a Fund's right to repurchase the security may be restricted; the value of the security may change over the term of the financing transaction; and the return earned by a Fund with the proceeds of a financing transaction may not exceed transaction costs. Futures and Options. Certain Funds are authorized to enter into futures contracts and options. A Fund may use futures contracts and options to manage its exposure to the securities markets or to movements in interest rates and currency values. The primary risks associated with the use of futures contracts and options are imperfect correlation between the change in market value of the securities held by a Fund and the prices of futures contracts and options, the possibility of an illiquid market, and the inability of the counterparty to meet the terms of the contract. Futures contracts and purchased options are valued based upon their quoted daily settlement prices. The premium received for a written option is recorded as an asset with an equal liability which is marked to market based on the option's quoted daily settlement price. Fluctuations in the value of such instruments are recorded as unrealized appreciation (depreciation) until terminated, at which time realized gains and losses are recognized. Forward Currency Transactions. Certain Funds are authorized to enter into forward foreign exchange contracts for the purpose of hedging against foreign exchange risk arising from the Fund's investment or anticipated investment in securities denominated in foreign currencies. A Fund also may enter into these contracts for purposes of increasing exposure to a foreign currency or to shift exposure to foreign currency fluctuations from one country to another. All commitments are marked to market daily at the applicable translation rates and any resulting unrealized gains or losses are recorded. Realized gains or losses are recorded at the time the forward contract matures or by delivery of the currency. Risks may arise upon entering into these contracts from the potential inability of counterparties to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Swaps. Certain Funds are authorized to enter into interest rate, total return and currency exchange swap agreements in order to obtain a desired return at a lower cost than if the Fund had invested directly in the asset that yielded the desired return. Swaps involve commitments to exchange components of income (generally interest or returns) pegged to the underlying assets based on a notional principal amount. Swaps are marked to market daily based upon quotations from market makers and the change, if any, is recorded as unrealized gains or losses in the Statements of Operations. A Fund bears the risk of loss of the amount expected to be received under a swap agreement in the event of the default or bankruptcy of a counterparty. Short Sales. Certain Funds have entered into short sales transactions during the fiscal year. A short sale is a transaction in which a Fund sells securities it does not own in anticipation of a decline in the market price of the securities. The Fund is obligated to deliver securities at the market price at the time the short position is closed. Possible losses from short sales may be unlimited, whereas losses from purchases cannot exceed the total amount invested. Stripped Mortgage-Backed Securities (SMBS). SMBS represent a participation in, or are secured by and payable from, mortgage loans on real property, and may be structured in classes with rights to receive varying proportions of principal and interest. SMBS include interest-only securities (IOs), which receive all of the interest, and principal-only securities (POs), which receive all of the principal. If the underlying mortgage assets experience greater than anticipated payments of principal, a Fund may fail to recoup some or all of its initial investment in these securities. The market value of these securities is highly sensitive to changes in interest rates. Delayed Delivery Transactions. Certain Funds may purchase or sell securities on a when-issued or delayed delivery basis. These transactions involve a commitment by a Fund to purchase or sell securities for a predetermined price or yield, with payment and delivery taking place beyond the customary settlement period. When delayed delivery purchases are outstanding, a Fund will set aside and maintain until the settlement date in a segregated account, liquid assets in an amount sufficient to meet the purchase price. When purchasing a security on a delayed delivery basis, a Fund assumes the rights and risks of ownership of the security, including the risk of price and yield fluctuations, and takes such fluctuations into account when determining its net asset value. A Fund may dispose of or renegotiate a delayed delivery transaction after it is entered into, and may sell when-issued securities before they are delivered, which may result in a capital gain or loss. When the Fund has sold a security on a delayed delivery basis, the Fund does not participate in future gains and losses with respect to the security. Forward sales commitments are accounted for by the Fund in the same manner as forward currency contracts discussed above. Inflation-Indexed Bonds. Inflation-indexed bonds are fixed income securities whose principal value is periodically adjusted to the rate of inflation. The interest rate on these bonds is generally fixed at issuance at a rate lower than typical bonds. Over the life of an inflation-indexed bond, however, interest will be paid based on a principal value which is adjusted for inflation. Any increase in the principal amount of an inflation-indexed bond will be considered interest income, even though investors do not receive their principal until maturity. Repurchase Agreements. Each Fund may engage in repurchase transactions. Under the terms of a typical repurchase agreement, the Fund takes possession of an underlying debt obligation subject to an obligation of the seller to repurchase, and the Fund to resell, the obligation at an agreed-upon price and time. The market value of the collateral must be equal at all times to the total amount of the repurchase obligations, including interest. Generally, in the event of counterparty default, the Fund has the right to use the collateral to offset losses incurred. 176 PIMCO Funds Annual Report | 3.31.01 Reverse Repurchase Agreements. Certain Funds are authorized to enter into reverse repurchase agreements. In a reverse repurchase agreement, the Fund sells to a financial institution a security that it holds with an agreement to repurchase the same security at an agreed-upon price and date. A reverse repurchase agreement involves the risk that the market value of the security sold by the Fund may decline below the repurchase price of the security. Restricted Securities. Certain Funds are permitted to invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. 3. Fees, Expenses, and Related Party Transactions Investment Advisory Fee. Pacific Investment Management Company (PIMCO) is a wholly owned subsidiary partnership of PIMCO Advisors L.P. and serves as investment adviser (the "Adviser") to the Trust, pursuant to an investment advisory contract. The Adviser receives a monthly fee from each Fund at an annual rate based on average daily net assets of the Fund. The Advisory Fee is charged at an annual rate of 0.15% for the Money Market Fund, 0.20% for the Short Duration Municipal Income Fund, 0.40% for the Convertible and StocksPLUS Funds, 0.45% for the Emerging Markets Bond Fund, 0.50% for the European Convertible Fund and 0.25% for all other Funds. Administration Fee. PIMCO serves as administrator (the "Administrator"), and provides administrative services to the Trust for which it receives from each Fund a monthly administrative fee based on each share class' average daily net assets. The Administration Fee for the Institutional Classes is charged at the annual rate of 0.18% for the Total Return and Low Duration Funds, 0.19% for the Short Duration Municipal Income Fund, 0.20% for the Moderate Duration, Short-Term and Money Market Funds, 0.24% for the California Intermediate Municipal Bond, California Municipal Bond and New York Intermediate Municipal Bond Funds, 0.30% for the Global Bond and Global Bond II Funds, 0.40% for the Emerging Markets Bond Fund and 0.25% for all other Funds. The Administration Fee for the A, B and C Classes is charged at an annual rate of 0.35% for the Short-Term, Money Market, Municipal Bond, California Intermediate Municipal Bond, California Municipal Bond and New York Municipal Bond Funds, 0.45% for the Foreign Bond and Global Bond II Funds, 0.55% for the Emerging Markets Bond Fund and 0.40% for all other Funds. The Administration Fee for Class D is charged at the annual rate of 0.25% for the Short-Term, Total Return, and Low Duration Funds, 0.35% for the California Intermediate Municipal Bond, California Municipal Bond, New York Municipal Bond, Municipal Bond, and Short Duration Municipal Income Funds, 0.45% for the Foreign Bond Fund, 0.55% for the Emerging Markets Bond Fund and 0.40% for all other Funds. Strategic Balanced Fund Fees. Effective September 29, 2000, the Strategic Balanced Fund changed investment objectives to a "fund of funds" and as such does not pay any fees to PIMCO under the Trust's investment advisory agreement in return for the advisory and asset allocation services provided by PIMCO. The Fund does, however, indirectly pay its proportionate share of the advisory fees paid to PIMCO by the Underlying Funds in which the Fund invests. The Fund pays administrative fees to PIMCO at an annual rate of 0.05% based on the average daily net assets attributable in the aggregate to the Fund's Institutional Class and Administrative Class shares. The Fund also indirectly pays its proportionate share of the administrative fees charged by PIMCO to the Underlying Funds in which the Fund invests. Distribution and Servicing Fees. PIMCO Funds Distributors LLC, ("PFD"), a wholly-owned subsidiary of PIMCO Advisors L.P., serves as the distributor of the Trust's shares. The Trust is permitted to reimburse, out of the Administrative Class assets of each Fund offering Administrative Class shares in an amount up to 0.25% on an annual basis of the average daily net assets of that class, financial intermediaries that provide services in connection with the distribution of shares or administration of plans or programs that use Fund shares as their funding medium. The effective rate paid to PFD was 0.25% during current fiscal year. Pursuant to the Distribution and Servicing Plans adopted by the A, B, C and D Classes of the Trust, the Trust compensates PFD or an affiliate with respect to Class D for services provided and expenses incurred in connection with assistance rendered in the sale of shares and services rendered to shareholders and for maintenance of shareholder accounts of the A, B, C and D Classes. The Trust paid PFD distribution and servicing fees at an effective rate as set forth below (calculated as a percentage of each Fund's average daily net assets attributable to each class): Distribution Fee (%) Servicing Fee (%) -------------------------------------------------------------------------------- Class A Money Market Fund -- 0.10 All other Funds -- 0.25 Class B All Funds 0.75 0.25 Class C Total Return, Long-Term U.S. Gov't., High Yield, Total Return Mortgage, Foreign Bond, Global Bond II, Emerging Markets Bond, Strategic Balanced and Convertible Bond Funds 0.75 0.25 Low Duration, Real Return Bond, StocksPLUS and Municipal Bond Funds 0.50 0.25 Short-Term Fund 0.30 0.25 Money Market Fund -- 0.10 Class D All Funds -- 0.25 PFD also receives the proceeds of the initial sales charges paid by the shareholders upon the purchase of Class A shares, except for the Money Market Fund, and the contingent deferred sales charges paid by the shareholders upon certain redemptions of A, B and C Class shares. For the period ended March 31, 2001, PFD received $14,039,941 representing commissions (sales charges) and contingent deferred sales charges. 3.31.01 | PIMCO Funds Annual Report 177 Notes to Financial Statements (Cont.) March 31, 2001 Expenses. The Trust is responsible for the following expenses: (i) salaries and other compensation of any of the Trust's executive officers and employees who are not officers, directors, stockholders or employees of PIMCO or its subsidiaries or affiliates; (ii) taxes and governmental fees; (iii) brokerage fees and commissions and other portfolio transaction expenses; (iv) the costs of borrowing money, including interest expense; (v) fees and expenses of the Trustees who are not "interested persons" of PIMCO or the Trust, and any counsel retained exclusively for their benefit; (vi) extraordinary expenses, including costs of litigation and indemnification expenses; (vii) organization expense and (viii) any expenses allocated or allocable to a specific class of shares, which include service fees payable with respect to the Administrative Class shares and may include certain other expenses as permitted by the Trust's Multiple Class Plan adopted pursuant to Rule 18f-3 under the Act and subject to review and approval by the Trustees. The ratio of expenses to average net assets per share class, as disclosed in Financial Highlights, may differ from the annual fund operating expenses per share class as disclosed in the Prospectus for the reasons set forth above. PIMCO has agreed to waive a portion of Investment Grade Corporate Bond, Convertible, European Convertible, Short Duration Municipal Income, California Intermediate Municipal Bond, California Municipal Bond and New York Intermediate Municipal Bond Funds administrative fees to the extent that the payment of each Fund's pro rate share of Trustee fees and organizational expenses cause the actual expense ratios to rise above the rates disclosed in the then-current prospectus plus 0.49 basis points as set forth below (calculated as a percentage of each Fund's average daily net assets attributable to each class):
Inst'l Class Admn. Class Class A Class B Class C Class D -------------------------------------------------------------------------------------------------------------------- Investment Grade Corporate Bond Fund 0.50% 0.75% -- -- -- -- Convertible Fund 0.65% 0.90% 1.05% 1.80% 1.80% 1.05% European Convertible Bond Fund 0.75% 1.00% 1.15% -- -- 1.05% Short Duration Municipal Income Fund 0.39% 0.64% -- -- -- 0.80% California Intermediate Municipal Bond Fund 0.49% 0.75% 0.85% -- -- 0.85% California Municipal Bond Fund 0.49% 0.74% 0.85% -- -- 0.85% New York Municipal Bond Fund 0.49% 0.74% 0.89% -- -- 0.87%
PIMCO may be reimbursed for these waived amounts in future periods. Each unaffiliated Trustee receives an annual retainer of $45,000**, plus $3,000 for each Board of Trustees meeting attended in person and $500 for each meeting attended telephonically, plus reimbursement of related expenses. In addition, each committee chair receives an annual retainer of $1,500. These expenses are allocated to the Funds of the Trust according to their respective net assets. ** Effective January 1, 2001, the annual retainer for the unaffiliated Trustee is equal to $60,000. 178 PIMCO Funds Annual Report | 3.31.01 4. Purchases and Sales of Securities Purchases and sales of securities (excluding short-term investments) for the period ended March 31, 2001, were as follows (amounts in thousands):
U.S. Government/Agency All Other ----------------------------------------------------------------------------------- Purchases Sales Purchases Sales ----------------------------------------------------------------------------------------------------------------------------- Total Return Fund $ 222,602,527 $ 197,986,156 $ 24,585,355 $ 29,666,864 Total Return Fund II 12,319,793 11,647,524 425,261 421,573 Total Return Fund III 6,235,037 6,077,758 342,867 292,393 Moderate Duration Fund 2,227,429 2,036,150 345,733 202,321 Low Duration Fund 20,847,584 18,096,892 2,684,950 1,693,694 Low Duration Fund II 3,276,044 2,817,135 303,386 157,021 Low Duration Fund III 231,594 200,286 24,005 20,923 Short-Term Fund 1,098,486 721,233 534,843 255,803 Long-Term U.S. Government Fund 6,836,016 6,798,278 91,885 24,440 Investment Grade Corporate Bond Fund 8,689 8,482 11,960 7,117 High Yield Fund 0 0 1,404,633 1,942,746 Total Return Mortgage Fund 191,474 166,061 8,458 1,769 GNMA Fund 132,021 125,324 3,379 531 Real Return Bond Fund 2,672,335 2,007,218 592,915 86,773 Foreign Bond Fund 2,889,041 2,885,954 1,374,920 1,157,516 Global Bond Fund 1,455,292 1,434,116 700,101 556,587 Global Bond Fund II 351,826 368,896 208,602 174,075 Emerging Markets Bond Fund 0 0 430,286 410,116 Strategic Balanced Fund 457,515 496,733 130,468 151,976 Convertible Fund 0 0 306,691 337,797 European Convertible Fund 0 0 8,881 6,292 StocksPLUS Fund 3,196,677 2,697,059 707,315 830,795 Municipal Bond Fund 108 0 218,600 193,470 Short Duration Municipal Bond Fund 0 0 30,583 28,172 California Intermediate Municipal Bond Fund 108 0 49,465 38,049 California Municipal Bond Fund 218 0 327,131 238,379 New York Municipal Bond Fund 0 0 32,246 31,733
5. Transactions in Written Call and Put Options Transactions in written call and put options were as follows (amounts in thousands):
------------------------------------------------------------------------------------------------- Total Return Total Return II Total Return III Moderate Duration Low Duration Fund Fund Fund Fund Fund ------------------------------------------------------------------------------------------------- Premium ------------------------------------------------------------------------------------------------- Balance at 03/31/2000 $ 31,722 $ 1,090 $ 558 $ 250 $ 3,873 Sales 106,979 2,853 6,348 272 3,939 Closing Buys (48,176) (1,556) (4,219) (85) (361) Expirations (52,921) (1,625) (1,698) (437) (3,597) Exercised (1,849) 0 (199) 0 (2,032) ------------------------------------------------------------------------------------------------- Balance at 03/31/2001 $ 35,755 $ 762 $ 790 $ 0 $ 1,822 ------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------- Low Duration II Low Duration III Long-Term Foreign Bond Global Bond Fund Fund U.S. Gov't Fund Fund Fund ------------------------------------------------------------------------------------------------- Premium ------------------------------------------------------------------------------------------------- Balance at 03/31/2000 $ 289 $ 23 $ 579 $ 473 $ 213 Sales 122 46 4,925 1,986 768 Closing Buys (88) (25) (4,137) (424) (117) Expirations (323) (16) (736) (1,329) (531) Exercised 0 (7) 0 (10) (5) ------------------------------------------------------------------------------------------------- Balance at 03/31/2001 $ 0 $ 21 $ 631 $ 696 $ 328 ------------------------------------------------------------------------------------------------- -------------------------------------------------------- Global Bond Strategic StocksPLUS Fund II Balanced Fund Fund -------------------------------------------------------- Premium -------------------------------------------------------- Balance at 03/31/2000 $ 40 $ 692 $ 1,231 Sales 258 643 9,853 Closing Buys (66) (275) 3,255 Expirations (175) (1,060) (13,583) Exercised (1) 0 0 -------------------------------------------------------- Balance at 03/31/2001 $ 56 $ 0 $ 756 --------------------------------------------------------
3.31.01 | PIMCO Funds Annual Report 179 Notes to Financial Statements (Cont.) March 31, 2001 6. Shares of Beneficial Interest The Trust may issue an unlimited number of shares of beneficial interest with a $.0001 par value. Changes in shares of beneficial interest were as follows (shares and amounts in thousands):
Total Return Fund Total Return Fund II ------------------------------------------------- ------------------------------------------- Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount Receipts for shares sold Institutional Class 1,049,394 $10,686,192 911,222 $9,137,242 57,731 $ 570,675 66,740 $653,040 Administrative Class 272,618 2,801,443 218,285 2,193,159 6,262 62,044 3,294 31,950 Other Classes 278,473 2,858,874 215,631 2,171,970 0 0 0 0 Shares issued in reorganization Institutional Class 0 0 0 0 0 0 0 0 Administrative Class 0 0 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 0 0 Issued as reinvestment of distributions Institutional Class 150,080 1,529,088 116,974 1,172,270 7,254 71,901 5,709 55,668 Administrative Class 19,472 198,869 11,320 113,239 381 3,782 286 2,786 Other Classes 12,054 123,077 12,790 128,441 0 0 0 0 Cost of shares redeemed Institutional Class (681,617) (6,936,468) (623,571) (6,242,527) (39,185) (389,100) (39,438) (384,235) Administrative Class (107,873) (1,104,430) (95,333) (953,360) (5,002) (49,423) (3,124) (30,450) Other Classes (118,243) (1,205,155) (122,336) (1,223,161) 0 0 0 0 Net Increase (decrease) resulting from Fund share transactions 874,358 $8,951,490 644,982 $6,497,273 27,441 $ 269,879 33,467 $328,759 ---------------------------- ------------------------------------------------- ------------------------------------------- Total Return Fund III ------------------------------------------- Year Ended Year Ended 03/31/2001 03/31/2000 Shares Amount Shares Amount Receipts for shares sold Institutional Class 25,145 $ 221,365 27,684 $ 246,232 Administrative Class 19 163 942 8,282 Other Classes 0 0 0 0 Shares issued in reorganization Institutional Class 0 0 0 0 Administrative Class 0 0 0 0 Other Classes 0 0 0 0 Issued as reinvestment of distributions Institutional Class 5,186 46,166 3,669 32,584 Administrative Class 71 637 22 195 Other Classes 0 0 0 0 Cost of shares redeemed Institutional Class (8,505) (75,805) (11,285) (99,748) Administrative Class (29) (259) (5) (40) Other Classes 0 0 0 0 Net Increase (decrease) resulting from Fund share transactions 21,887 $ 192,267 21,027 $ 187,505 ---------------------------- --------------------------------------------
Short-Term Fund Money Market Fund ------------------------------------------- ---------------------------------------------- Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount Receipts for shares sold Institutional Class 55,902 $557,919 120,611 $1,202,372 145,605 $ 145,605 382,805 $382,805 Administrative Class 760 7,559 1,778 17,721 16,511 16,510 45,030 45,030 Other Classes 11,858 118,255 13,899 138,529 2,312,652 2,312,653 6,791,637 6,791,637 Shares issued in reorganization Institutional Class 0 0 0 0 0 0 0 0 Administrative Class 0 0 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 0 0 Issued as reinvestment of distributions Institutional Class 2,860 28,548 2,198 21,902 12,820 12,820 14,007 14,008 Administrative Class 27 271 24 234 485 485 426 426 Other Classes 457 4,561 499 4,967 7,633 7,633 6,923 6,923 Cost of shares redeemed Institutional Class (65,673) (655,344) (113,004) (1,126,670) (327,450) (327,450) (414,090) (414,090) Administrative Class (1,849) (18,406) (656) (6,533) (19,622) (19,622) (44,939) (44,939) Other Classes (10,683) (106,536) (14,093) (140,433) (2,341,229) (2,341,229) (6,778,173) (6,778,173) Net Increase (decrease) resulting from Fund share transactions (6,341) $(63,173) 11,256 $112,089 (192,595) $(192,595) 3,626 $ 3,627 ---------------------------- ------------------------------------------- ---------------------------------------------- Long-Term U.S. Government Fund ---------------------------------------------- Year Ended Year Ended 03/31/2001 03/31/2000 ---------------------------------------------- Shares Amount Shares Amount ---------------------------------------------- Receipts for shares sold Institutional Class 18,130 $ 185,685 17,536 $ 170,823 Administrative Class 5,916 61,908 4,792 47,739 Other Classes 11,785 122,155 6,812 66,187 Shares issued in reorganization Institutional Class 0 0 0 0 Administrative Class 0 0 0 0 Other Classes 0 0 0 0 Issued as reinvestment of distributions Institutional Class 1,175 11,990 1,110 10,760 Administrative Class 268 2,736 246 2,386 Other Classes 372 3,801 396 3,859 Cost of shares redeemed Institutional Class (19,535) (204,230) (13,014) (124,451) Administrative Class (2,979) (30,338) (2,075) (20,024) Other Classes (6,251) (63,811) (6,842) (66,603) Net Increase (decrease) resulting from Fund share transactions 8,881 $ 89,896 8,961 $ 90,676 ---------------------------- ----------------------------------------------
180 PIMCO Funds Annual Report | 3.31.01
Moderate Duration Fund Low Duration Fund Low Duration Fund II --------------------------------------- ------------------------------------------ ------------------------------------- Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount 27,897 $ 271,662 20,710 $200,422 247,498 $2,441,784 287,904 $ 2,852,869 40,536 $ 394,918 13,865 $136,132 0 0 0 0 9,991 98,789 8,814 87,882 8 82 26 251 0 0 0 0 32,296 318,860 53,936 534,201 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 3,123 30,441 2,170 20,913 22,292 220,160 20,182 199,668 3,649 35,794 2,647 25,816 0 0 0 0 902 8,907 747 7,388 0 1 1 12 0 0 0 0 1,911 18,884 1,912 18,941 0 0 0 0 (13,959) (135,840) (14,158) (137,218) (226,741) (2,235,908) (290,438) (2,872,755) (28,675) (280,932) (9,884) (96,194) 0 0 0 0 (7,883) (78,115) (10,124) (100,890) (7) (73) (2,291) (22,782) 0 0 0 0 (28,214) (278,280) (49,060) (485,171) 0 0 0 0 17,061 $ 166,263 8,722 $ 84,117 52,052 $515,081 23,873 $ 242,133 15,511 $ 149,790 4,364 $ 43,235 --------------------------------------- ------------------------------------------ ------------------------------------- Low Duration Fund III ---------------------------------------- Year Ended Year Ended 03/31/2001 03/31/2000 Shares Amount Shares Amount 2,567 $ 25,072 1,305 $ 12,807 0 0 4 46 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 269 2,621 174 1,702 0 1 0 - 0 0 - - (1,841) (18,040) (791) (7,810) 0 0 (4) (43) 0 0 0 0 995 $ 9,654 688 $ 6,703 ----------------------------------------
Investment Grade Corporate Fund Bond High Yield Fund Total Return Mortgage Fund ------------------------- -------------------------------------------- -------------------------------------- Period from 04/28/2000 Year Ended Year Ended Year Ended Year Ended to 03/31/2001 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount 500 $ 5,000 79,092 $792,834 112,421 $1,221,190 1,923 $ 19,192 5 $ 51 0 0 22,374 224,073 23,707 255,416 0 0 0 0 0 0 52,126 522,135 55,214 597,715 516 5,324 18 176 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 38 397 11,673 116,900 16,391 176,340 124 1,270 24 235 0 0 3,726 37,198 2,363 25,317 0 0 0 0 0 0 3,496 34,732 3,722 40,061 10 104 1 5 0 0 (162,673) (1,605,873) (129,621) (1,380,777) (496) (5,092) (34) (342) 0 0 (13,874) (138,474) (12,693) (135,307) 0 0 0 0 0 0 (38,440) (385,505) (48,358) (518,612) (88) (904) (21) (212) 538 $ 5,397 (42,500) $(401,980) 23,146 $281,343 1,989 $ 19,894 (7) $ (87) ------------------------- -------------------------------------------- -------------------------------------- GNMA Fund --------------------------------- Year Ended Year Ended 03/31/2001 03/31/2000 Shares Amount Shares Amount 908 $ 9,067 3 $ 27 0 0 0 0 1 10 0 0 0 0 0 0 0 0 0 0 0 0 0 0 53 530 26 261 0 0 0 0 0 0 0 0 (441) (4,496) (5) (48) 0 0 0 0 0 0 0 0 521 $ 5,111 24 $ 240 ---------------------------------
3.31.01 | PIMCO Funds Annual Report 181 Notes to Financial Statements (Cont.) March 31, 2001 Shares of Beneficial Interest (Cont.) The Trust may issue an unlimited number of shares of beneficial interest with a $.0001 par value. Changes in shares of beneficial interest were as follows (shares and amounts in thousands):
Real Return Bond Fund Foreign Bond Fund ----------------------------------------------------------------------------------- Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount Receipts for shares sold Institutional Class 41,127 $ 412,572 20,255 $197,599 17,028 $ 172,052 $ 17,555 $ 178,740 Administrative Class 6,218 62,788 0 0 1,466 14,864 463 4,784 Other Classes 23,900 242,511 5,672 55,389 8,035 81,245 7,466 76,013 Shares issued in reorganization Institutional Class 0 0 0 0 0 0 0 0 Administrative Class 0 0 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 0 0 Issued as reinvestment of distributions Institutional Class 3,032 30,496 451 4,405 3,087 31,126 2,850 28,907 Administrative Class 120 1,223 0 0 53 540 32 324 Other Classes 743 7,495 145 1,416 842 8,494 609 6,155 Cost of shares redeemed Institutional Class (11,491) (115,763) (1,320) (12,861) (15,445) (155,946) (28,226) (286,997) Administrative Class (1,400) (14,142) 0 0 (348) (3,524) (211) (2,130) Other Classes (3,027) (30,405) (841) (8,197) (3,749) (37,903) (4,535) (45,879) Net Increase (decrease) resulting from Fund share transactions 59,222 $ 596,775 24,362 $237,751 10,969 $ 110,948 $ (3,997) $ (40,083) --------------------------------------------- --------------------------------------- ----------------------------------------- Global Bond Fund -------------------------------------------- Year Ended Year Ended 03/31/2001 03/31/2000 Shares Amount Shares Amount Receipts for shares sold Institutional Class 17,392 $ 150,687 9,839 $ 90,144 Administrative Class 340 2,952 795 7,497 Other Classes 0 0 0 0 Shares issued in reorganization Institutional Class 0 0 0 0 Administrative Class 0 0 0 0 Other Classes 0 0 0 0 Issued as reinvestment of distributions Institutional Class 1,336 11,553 1,162 10,736 Administrative Class 14 123 19 172 Other Classes 0 0 0 0 Cost of shares redeemed Institutional Class (12,471) (107,207) (8,187) (74,885) Administrative Class (350) (3,030) (701) (6,530) Other Classes 0 0 0 0 Net Increase (decrease) resulting from Fund share transactions 6,261 $ 55,078 2,927 $ 27,134 ------------------------------------------- --------------------------------------------
European Convertible Fund StocksPLUS Fund Municipal Bond Fund --------------------------------------------------------------------------------------------------- Period from 11/30/2000 Year Ended Year Ended Year Ended Year Ended to 03/31/2001 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Receipts for shares sold Institutional Class 499 $ 4,990 15,120 $ 192,570 15,093 $218,329 2,478 $ 23,749 443 $ 4,203 Administrative Class 0 0 1,533 19,575 4,321 63,727 262 2,528 315 3,032 Other Classes 1 10 15,643 203,143 35,815 512,940 2,162 21,007 1,697 16,283 Shares issued in reorganization Institutional Class 0 0 0 0 0 0 0 0 0 0 Administrative Class 0 0 0 0 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 0 0 0 0 Issued as reinvestment of distributions Institutional Class 2 20 3,690 45,695 7,047 99,393 71 685 25 239 Administrative Class 0 0 274 3,338 530 7,404 20 193 12 113 Other Classes 0 0 4,049 49,151 9,584 133,688 104 1,006 134 1,286 Cost of shares redeemed Institutional Class 0 0 (21,472) (275,526) (14,080) (201,504) (806) (7,753) (450) (4,329) Administrative Class 0 0 (317) (3,869) (3,619) (52,930) (134) (1,304) (135) (1,268) Other Classes 0 0 (24,600) (314,693) (32,255) (455,756) (1,711) (16,427)(2,276) (21,656) Net Increase (decrease) resulting from Fund share transactions 502 $ 5,020 (6,080) $ (80,616) 22,436 $325,291 2,446 $ 23,684 (235) $ (2,097) -------------------------------------- --------------- ---------------------------------------- -----------------------------------
182 PIMCO Funds Annual Report | 3.31.01
Global Bond Fund II Emerging Markets Bond Fund Strategic Balanced Fund ------------------------------------ ------------------------------------ ------------------------------------- Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount 737 $ 6,935 6,377 $ 59,618 4,173 $ 34,602 2,116 $ 16,701 315 $ 3,779 880 $ 8,040 0 0 0 0 120 1,010 3,429 25,789 14 151 75 956 406 3,819 460 4,394 413 3,495 125 979 823 9,610 704 12,505 0 0 0 0 0 0 0 0 0 0 2,758 35,908 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2,379 30,872 567 5,308 268 2,526 579 4,821 111 888 493 5,725 552 7,091 0 0 0 0 172 1,434 114 915 5 63 3 45 71 671 58 545 18 154 9 73 197 2,217 161 2,065 (3,782) (35,563) (558) (5,204) (720) (5,860) (1,248) (9,797) (6,058) (76,927) (2,101) (26,925) 0 0 0 0 (932) (7,791) (1,993) (15,204) (27) (325) (23) (293) (391) (3,685) (595) (5,615) (210) (1,800) (37) (311) (751) (8,994) (949) (11,948) (2,392) $(22,515) 6,010 $56,264 3,613 $ 30,065 2,626 $ 20,033 (4,989) $(64,701) 4,439 $58,316 ------------------------------------ ------------------------------------ ------------------------------------- Convertible Fund ---------------------------------------- Year Ended Year Ended 03/31/2001 03/31/2000 Shares Amount Shares Amount 6,602 $ 90,224 13,295 $ 176,112 28 410 0 0 1,596 22,419 1,059 14,391 0 0 0 0 0 0 0 0 0 0 0 0 563 7,572 137 1,984 0 1 0 0 81 1,074 8 120 (12,009) (155,586) (2,763) (41,632) 0 0 0 0 (450) (6,093) (61) (841) (3,589) $(39,979) 11,675 $ 150,134 ---------------------------------------
California California Intermediate Municipal Short Duration Municipal Income Fund Municipal Bond Fund Bond Fund ------------------------------------------ ------------------------------------ ------------------ Period from Period from Period from Year Ended 08/31/1999 Year Ended 08/31/1999 05/16/2000 03/31/2001 to 03/31/2000 3/31/2001 to 03/31/2000 to 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount 1,361 $ 13,744 1,050 $ 10,500 11,124 $ 112,569 885 $ 8,840 2,106 $ 21,136 0 0 0 0 156 1,550 1 10 0 0 0 0 1 10 4,161 42,117 190 1,889 80 819 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 57 575 24 241 294 3,049 9 91 79 807 0 0 0 0 6 66 0 0 0 0 0 0 0 0 108 1,124 1 12 0 4 (1,149) (11,638) 0 0 (3,996) (40,783) (56) (556) (1,031) (10,590) 0 0 0 0 (1) (10) 0 0 0 0 0 0 0 0 (1,691) (17,630) (12) (119) (11) (110) 269 $ 2,681 1,075 $ 10,751 10,161 $ 102,052 1,018 $ 10,167 1,223 $ 12,066 ------------------------------------------ ------------------------------------ ------------------- New York Municipal Bond Fund --------------------------------- Period from Year Ended 08/31/1999 3/31/2001 to 03/31/2000 --------------------------------- Shares Amount Shares Amount --------------------------------- 28 $ 300 300 $ 3,000 0 0 0 0 27 285 2 20 0 0 0 0 0 0 0 0 0 0 0 0 17 171 8 76 0 0 0 0 0 2 0 0 0 0 0 0 0 0 0 0 (1) (11) 0 0 71 $ 747 310 $ 3,096 ----------------------------------
3.31.01 | PIMCO Funds Annual Report 183 Notes to Financial Statements (Cont.) March 31, 2001 7. Reorganization The Acquiring Fund, as listed below, acquired the assets and certain liabilities of the Acquired Fund, also listed below, in a tax-free exchange for shares of the Acquiring Fund, pursuant to a plan of reorganization approved by the Acquired Fund's shareholders (amounts in thousands):
Value of Total Net Shares Shares Total Net Total Net Assets of Acquired Issued by Issued by Assets of Assets of Acquiring Fund's Acquiring Acquiring Acquiring Acquiring Fund After Unrealized Acquiring Fund Acquired Fund Date Fund Fund Fund Fund Acquisition Depreciation ------------------------------------------------------------------------------------------------------------------------------------ PIMCO PIMCO Strategic Balanced Fund Balanced Fund 09/17/1999 5,137 $ 66,780 $ 66,780 $ 105,993 $172,774 $ (45)
8. Acquisition by Allianz AG On May 5, 2000, Allianz AG completed the acquisition of approximately 70% of the outstanding partnership interest in PIMCO Advisors L.P. ("PIMCO Advisors"), of which PIMCO is a subsidiary partnership. As a result of this transaction, PIMCO Advisors, and its subsidiaries, are now controlled by Allianz AG, a leading provider of financial services, particularly in Europe. PIMCO remains operationally independent, continues to operate under its existing name, and now leads the global fixed-income efforts of Allianz AG. Key employees at each PIMCO Advisors' investment units, including PIMCO's Bill Gross, have signed long-term employment contracts and have significant profit-sharing and retention arrangements to ensure continuity of the investment process and staff. The Allianz Group manages assets of approximately (Euro)713.3 billion as of December 31, 2000, including more than 300 mutual funds for retail and institutional clients around the world. 9. In-Kind Transactions For the period ended March 31, 2001, the following funds realized gains or losses from in-kind redemptions of approximately (amounts in thousands) Realized Gains Realized Losses -------------------------------------------------------------------------------- High Yield Fund $ 0 $ (70,521) Strategic Balanced Fund 59 0 10. Federal Income Tax Matters As of March 31, 2001, the Funds listed in the table below had remaining capital loss carryforwards that were realized or acquired in prior years. Use of the acquired capital loss carryforwards may be limited under current tax laws. Additionally, the California Intermediate Municipal Bond, Convertible Bond, Foreign Bond, Global Bond, Global Bond II, GNMA, High Yield, Investment Grade Corporate, Low Duration, Low Duration II, Low Duration III, Moderate Duration, Real Return, Short-Term, StocksPLUS, and Total Return Funds realized capital losses and/or foreign currency losses during the period November 1, 2000 through March 31, 2001 which the Funds elected to deter to the following fiscal year pursuant to income tax regulations. The amounts are $75,517, $5,480,569, $7,607,826, $20,939,942, $1,281,094, $4,945, $57,057,816, $1,251, $11,492,366, $99,011, $91,234, $258,567, $243,361, $721,218, $214,462,097, $17,936,702, respectively. Each Fund will resume capital gain distributions in the future to the extent gains are realized in excess of the available carryforwards.
Capital Loss Carryforwards -------------------------------------------- Realized Losses Acquired Losses Expiration ----------------------------------------------------------------------------------------------- Total Return Fund III $ 7,950,236 $ 0 3/31/2008 Moderate Duration 920,418 0 3/31/2008 Low Duration Fund 36,222,381 0 3/31/2008 Low Duration Fund II 2,514,750 0 3/31/2008 Low Duration Fund III 151,000 0 3/31/2009 Low Duration Fund III 336,265 0 3/31/2008 Short-Term Fund 326,974 0 3/31/2009 Short-Term Fund 412,413 0 3/31/2008 Short-Term Fund 109,956 0 3/31/2007 Long-Term U.S. Government Fund 4,671,320 0 3/31/2008 High Yield Fund 150,615,064 0 3/31/2009 High Yield Fund 39,492,722 0 3/31/2008 High Yield Fund 0 48,559,227 3/31/2003 Strategic Balance Fund 1,711,676 0 3/31/2009 StocksPLUS Fund 86,222,244 0 3/31/2009 Convertible Fund 3,488,828 0 3/31/2009
184 PIMCO Funds Annual Report | 3.31.01 Report of Independent Accountants To the Trustees and Institutional and Administrative Class Shareholders of the PIMCO Funds: Pacific Investment Management Series In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations, of changes in net assets and of cash flows and the financial highlights for the Institutional and Administrative Class shares present fairly, in all material respects, the financial position of the Total Return Fund, Total Return Fund II, Total Return Fund III, Moderate Duration Fund, Low Duration Fund, Low Duration Fund II, Low Duration Fund III, Short-Term Fund, Money Market Fund, Long-Term U.S. Government Fund, Investment Grade Corporate Bond Fund, High Yield Fund, Total Return Mortgage Fund, GNMA Fund, Real Return Bond Fund, Foreign Bond Fund, Global Bond Fund, Global Bond Fund II, Emerging Markets Bond Fund, Strategic Balanced Fund, Convertible Fund, European Convertible Fund, StocksPLUS Fund, Municipal Bond Fund, Short Duration Municipal Income Fund, California Intermediate Municipal Bond Fund, California Municipal Bond Fund, and New York Municipal Bond Fund (hereafter referred to as the "Funds") at March 31, 2001, the results of each of their operations, the changes in each of their net assets and cash flows for the Short-Term, Long-Term U.S. Government Fund, Real Return Bond Fund, Foreign Bond Fund, Global Bond Fund and Global Bond Fund II and the financial highlights for the Institutional and Administrative Class shares for each of the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Funds' management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with auditing standards generally accepted in the United States of America which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at March 31, 2001 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion. PricewaterhouseCoopers LLP Kansas City, Missouri May 23, 2001 3.31.01 | PIMCO Funds Annual Report 185 Federal Income Tax Information (unaudited) As required by the Internal Revenue Code regulations, shareholders must be notified within 60 days of the Trust's fiscal year end (March 31, 2001) regarding the status of the dividend received deduction for corporations. Dividend Received Deduction. Corporate shareholders are generally entitled to take the dividend received deduction on the portion of a Fund's dividend distribution that qualifies under tax law. The percentage of the following Fund's fiscal 2001 ordinary income dividends that qualifies for the corporate dividend received deduction is set forth below: Total Return Fund 1.22% Total Return Fund III 0.66% Moderate Duration Fund 1.30% Low Duration Fund 2.55% Low Duration Fund II 0.84% High Yield Fund 2.99% Foreign Bond Fund 0.41% Global Bond Fund II 0.40% Strategic Balanced Fund 7.48% Convertible Fund 17.46% European Convertible Fund 0.96% StocksPLUS Fund 15.77% For the benefit of shareholders of the Municipal Bond, Short Duration Municipal Income, California Municipal Bond, California Intermediate Municipal Bond and New York Municipal Bond Funds, this is to inform you that 100.00%, 97.83%, 100.00%, 100.00%, and 100.00%, respectively, of the dividends paid by the Funds during its fiscal year qualify as exempt-interest dividends. Shareholders are advised to consult their own tax advisor with respect to the tax consequences of their investment in the Trust. In January 2002, you will be advised on IRS Form 1099-DIV as to the federal tax status of the dividends and distributions received by you in calendar year 2001. 186 PIMCO Funds Annual Report | 3.31.01 Pacific Investment Management Company LLC (PIMCO) is responsible for the management and administration of the PIMCO Funds: Pacific Investment Management Series. Founded in 1971, PIMCO currently manages assets in excess of $219 billion on behalf of mutual fund and institutional clients located around the world. Renowned for its fixed income management expertise, PIMCO manages assets for many of the largest corporations, foundations, endowments, and governmental bodies in the United States and the world. Trustees and Officers Brent R. Harris Chairman and Trustee R. Wesley Burns President and Trustee Guilford C. Babcock Trustee E. Philip Cannon Trustee Vern O. Curtis Trustee J. Michael Hagan Trustee Thomas P. Kemp Trustee William J. Popejoy Trustee Garlin G. Flynn Secretary John P. Hardaway Treasurer Investment Adviser and Administrator Pacific Investment Management Company LLC 840 Newport Center Drive, Suite 300 Newport Beach, CA 92660 Custodian State Street Bank & Trust Company 801 Pennsylvania Kansas City, MO 64105 Transfer Agent National Financial Data Services 330 W. 9th Street, 4th Floor Kansas City, MO 64105 Counsel Dechert 1775 Eye Street, N.W. Washington, D.C. 20006-2401 Independent Accountants PricewaterhouseCoopers LLP 1055 Broadway Kansas City, MO 64105 PIMCO Funds Distributors LLC 2187 Atlantic Street, Stamford, CT 06902 This report is submitted for the general information of the shareholders of the PIMCO Funds. It is not authorized for distribution to prospective investors unless accompanied or preceded by an effective prospectus for the PIMCO Funds, which contains information covering its investment policies as well as other pertinent information. PIMCO ------- FUNDS 840 NEWPORT CENTER DRIVE, SUITE 300 NEWPORT BEACH, CA 92660 800.927.4648 www.pimco.com A Quarterly Publication from PIMCO Funds SPRING 2001 [GRAPHIC] Fixed Income Manager of the Year. Again. How Bill Gross and PIMCO became Morningstar's only two-time winner. Go paperless Gross & McCulley Six time-tested Inside: PIMCO Funds 5 with eDelivery |6 talk shop |9 investment principles |Annual Report
[LOGO OF PIMCO FUNDS] Access to the highest standard Encore! They did it again. This January, Bill Gross and the PIMCO bond team were named Morningstar's 2000 Fixed Income Fund Manager of the Year--making them the only repeat winner in the awards' 14 year history. What sets your bond managers apart from the pack? Here's the story. They're like the Oscars of the mutual fund world. Each January, Morningstar bestows its Manager of the Year awards, honoring those in three categories--domestic stock, international stock and fixed income--who "demonstrate excellent investment skill and the courage to differ from consensus." Oustanding performance in a given year is a leading criterion, but not enough to win. Recipients must also boast an exceptional long-term record. In fixed income last year, all roads led to Bill Gross and PIMCO. "Gross and his team hit on all cylinders in 2000, while steering clear of a bond market full of land mines," states Morningstar. They go on to cite that over the past 10 years, PIMCO's flagship Total Return Fund has outpaced the overall bond market (as represented by the Lehman Brothers Aggregate Bond Index) by a substantial margin. A LEADING ROLE PIMCO's winning bond management formula took root more than 25 years ago, when Gross helped pioneer a total return approach to bond investing--one that focused on income plus capital appreciation, rather than income alone. Today, it's the backbone of PIMCO's bond portfolios. Yet a total return approach to fixed income has since achieved widespread acceptance. " Two simple concepts--secular forecasting and innovation--are the reasons why PIMCO remains at the top of its field in the bond arena." --Bill Gross So when it comes to PIMCO's enduring success, there are clearly additional factors at work. One of the most significant is a drive for innovation. Gross's progressive, often contrarian mindset has become firmly embedded in the PIMCO bond culture. It's what led the team to invest early on in a number of breakthrough bond instruments: mortgage-backed securities in the 1970s, financial futures in the 1980s, and TIPS (Treasury Inflation-Protected Securities) in the late 1990s, to name a few. That's not to say that PIMCO is always looking to be first out of the gate. They sat out on the 80s junk bond craze, for example, waiting until the dust settled to form their sector strategy--a relatively conservative one. SETTING THE STAGE Further distinguishing PIMCO's bond management is its big-picture platform. The team gathers every May for a three-day Secular Forum to address the longer-term issues facing the bond market and the economy. To encourage out-of-the box thinking, PIMCO invites key outsiders to join in the discussion, including top academics and chiefs of industry. The forum culminates in the creation of a three- to five-year outlook, which serves as a guiding light for the PIMCO bond team. A LITTLE IMPROV Still, given even the most visionary top-down strategy, outperforming in the bond world is usually the result of making several small but savvy moves. For Gross and company, such decisions are not an exact science. "I've experimented over time with models and statistical " Because Gross won the award two years ago, we'd have preferred someone else, but no one really came close." -Morningstar 1/01 methodologies," Gross once said in an interview with Worth magazine." I find that the minute it looks like I have a successful model or discipline, that's about the time it collapses." Rather, the PIMCO team employs a number of "value-adding" strategies, which range from yield curve positioning to cost-effective trading, shifting their emphasis as economic conditions demand. State-of-the-art analytical capabilities also play a pivotal role. "Our enthusiastic embrace of technology nearly 20 years ago paved the way for additional performance throughout those years," Gross observes. Today, a hefty, ongoing investment in technology--much of it proprietary--continues to give the team a leg up on the competition. GREAT DIALOGUE It's significant to note that although Morningstar's Manager of the Year Awards are typically given to specific individuals, in this case the honor was extended to Bill Gross and the PIMCO bond team. And Gross himself is adamant about crediting his colleagues, collectively, for PIMCO's success. That's because there's a 138-person team powering PIMCO's bond management prowess. While individual managers head up specific funds, they all participate in setting PIMCO's strategic direction. Ultimately, it's the pooling of talents--the "best of the best" from various bond market disciplines--that makes for a winning combination. . Bill Gross at Your Fingertips Want to find out what Bill Gross and his colleagues are thinking now? Visit the PIMCO Funds Bond Center at www.pimcofunds.com/bondcenter. You'll find timely commentaries from your fund manager as well as other members of the PIMCO bond team. Past performance is no guarantee of future results. The Morningstar Fund Manager of the Year Award winners are chosen based upon Morningstar's own research and in-depth evaluation by its senior editorial staff. Average annual total return measures performance assuming that all dividend and capital gain distributions were reinvested. For the 1-, 5- & 10-year periods, Total Return A at NAV returned 12.27%, 7.81% & 8.62%; Total Return A w/4.5% maximum initial sales charge returned 7.22%, 6.83% & 8.12%; and Lehman Aggregate Bond Index returned 12.53%, 7.48% & 7.98%, respectively. The Lehman Aggregate Bond Index is generally considered to be representative of the bond market in general and it is not possible to invest directly in it. Bill Gross and team at PIMCO's Newport Beach, CA trading floor. [PHOTO] online update www.pimcofunds.com for Timely Market Commentary Increased market volatility has many investors concerned. If you are looking for expert analysis on what it all means, turn to PIMCO Funds Online. Last year we redesigned the PIMCO Funds Web site (www.pimcofunds.com) in order to provide you with more commentary from our investment professionals. Consider how our site's content might help you make sense of today's investment environment. DAILY MANAGER COMMENTARY End-of-day reports from PIMCO's fund managers covering everything from economic outlooks, to investment strategies, to breaking news analysis. BOND CENTER The latest information on the economy and the bond market from PIMCO's renowned fixed-income experts. You'll find manager newsletters and interviews, a comprehensive bond investing glossary, sector strategy white papers and more. INNOVATION CENTER Up-to-date market intelligence and commentary on the tech sector from PIMCO's specialists. Included in this section is "PIMCO's Theme Approach to Tech Investing," which evaluates eight key industries driving the sector. FUND INFORMATION The definitive story on each PIMCO Fund. In addition to in-depth performance data, each fund profile includes an overview, statistics at a glance, ratings and rankings, portfolio analysis, manager commentary, investment process, media highlights, and related literature. Virtual Stuff PIMCO Renaissance Fund--a multi-cap value fund--has been benefiting from the recent boom in value investing...not to mention some savvy moves by portfolio manager John Schneider. Now you can read all about his winning approach to the sector at www.pimcofunds.com. To download Bringing Value to Light, an in-depth profile on Schneider, just follow these simple steps: 1. From our Home page (www.pimcofunds.com) click on "Fund Information" 2. Select "Renaissance Fund" 3. Click on the "Literature" tab 4. Under Manager Profiles, select "John Schneider Profile". [PHOTO] Past performance is no guarantee of future results. Investment return will fluctuate and the value of an investor's shares will fluctuate and may be worth more or less than original cost when redeemed. The fund may invest up to 15% in foreign securities, which may entail greater risk due to foreign economic and political developments. This article will contain the current opinion of the manager and does not represent a recommendation of any particular security, strategy or investment product. Such opinions are subject to change without notice. This article is distributed for educational purposes and should not be considered investment advice. Go Paperless with eDelivery PIMCO Funds Online is proud to introduce its new eDelivery service. eDelivery is the electronic transmission of shareholder communications to you online--eliminating the paper mailings you've gotten in the past. HERE'S HOW IT WORKS When you sign up for eDelivery, you'll receive shareholder communications--including annual and semi-annual reports, prospectuses, proxy statements and newsletters--via the Internet. As materials become available, we'll send you an e-mail notification containing the Internet address (URL) where you can view and print the material. Please note that in order to eliminate paper mailings from being sent to your home, each person in your household must enroll separately. BENEFITS TO SHAREHOLDERS There are several compelling reasons to sign up for eDelivery. For example, the service is a faster and more convenient way to receive your shareholder communications. In addition, it is environmentally sound. And of course, it helps eliminate mailbox clutter! FREE SERVICE There is no charge for PIMCO Funds eDelivery. However, you may incur charges from Internet service providers and telephone companies while accessing the Internet. PRIVACY PROTECTION Rest assured that PIMCO considers customer privacy to be a fundamental aspect of our relationship with shareholders. Along these lines, we have developed policies to safeguard any personal information you provide to us, while allowing us to service your account professionally and responsively. Be sure to review our complete privacy policy when you enroll for eDelivery. NEXT STEPS To start enjoying the convenience of receiving shareholder communications online, follow these simple steps... . Sign up Complete the short eDelivery Enrollment Form, which outlines the complete terms and conditions of the service, by going to www.pimcofunds.com/edelivery. Remember, each account holder in your household must enroll separately. We will e-mail you a confirmation when we receive your Form. . Watch for notification Your participation in eDelivery will begin with the next quarterly cycle after you enroll. As soon as communications are accessible, we will e-mail you a notification with the Internet address where you can view and print the communications. . Discontinuing service Enrollment in eDelivery has no expiration date. If you change your mind, however, and would like to cancel your enrollment, simply go to www.pimcofunds.com/edelivery and click on the "change/cancel" link. The Web site articles will contain the current opinions of the managers and do not represent a recommendation of any particular security, strategy or investment product. Such opinions are subject to change without notice. Articles are distributed for educational purposes and should not be considered investment advice. Information regarding any fees and expenses may be obtained by calling 1-888-87-PIMCO. Please contact your financial advisor for any questions you might have relating to the PIMCO Funds and as always read the prospectus carefully before investing or sending money. Spring 2001 | access 5 The Big Picture [GRAPHIC] PIMCO's Bill Gross and Paul McCulley discuss the economy and financial markets [PHOTO] Bill Gross [PHOTO] Paul McCulley Widely regarded as America's most influential authority on the bond market, Bill Gross is the portfolio manager of PIMCO Total Return Fund--the country's largest bond fund.* Paul McCulley is an economist, monetary policy specialist, and a managing director of PIMCO. Q What's been happening with the economy recently? Bill: On a cyclical basis, we're seeing a classic inventory correction and the resulting contraction in the manufacturing and technology sectors. There are also several long-term excesses unraveling simultaneously, in particular, the deflating bubbles of consumer spending, investment and borrowing. They were self-reinforcing on the way up, and they're now a vicious cycle on the way down. Combine that with the dramatic rise in layoffs and surging unemployment claims, and the result is falling consumer confidence levels. And in a consumption-driven economy like ours, consumer confidence is vital. Q Do you see the economy rebounding anytime soon? Paul: I think we'll be mired in a recession until late in the year. Things will start to turn around once the current inventory correction runs its course, but a big bounce for the economy after that is unlikely due to restrained consumption. It looks more like we'll have a recovery with GDP growth of perhaps 2 or 3%. Why won't consumer spending snap back? Bill: Right now, consumer confidence is on the decline and real personal wealth in the U.S. has plunged along with equity market prices. We're also looking at a negative personal savings rate, stimulated by years of excess consumption beyond the average consumer's means. This combination makes it likely that debt-laden and increasingly anxious consumers will start saving again--reliquifying, if you will--in turn holding back the rate of consumption and the economy relative to the last several years. Q How is the Fed likely to respond? Paul: The Fed has already made several interest rate cuts since the beginning of the year, and we believe it will continue to ease aggressively. We think the Fed funds target rate needs to fall to at least 4%, but the longer the Fed waits to get to that target, the less effective the cuts will be and the deeper they'll have to go. In our view it is imperative for the Fed to reverse the downward trend in confidence at both the business and consumer levels. This would encourage risk capital to return to the financial markets. Q Is monetary policy alone going to bring a recovery? Paul: Certainly, slashing interest rates, which fosters new debt creation, can help. But I don't believe that Fed easing alone will be enough to generate a healthy recovery. We also need new fiscal policy in the form of an aggressive tax cut to transfer the government's surplus back into the private sector. Tax cuts put money in consumers' pockets and should alleviate some of the pressure they're feeling today. I also think the tax cut we need now should be aimed at the "average" American wage earner. It should be retroactive, and the bulk of it should go into effect in the near term. 6 access | Spring 2001 Q What's going on overseas? Paul: We expect global growth to continue to decelerate. The slowdown in Europe will be less severe than in the U.S., since consumer confidence should hold up and real incomes will get a boost from tax reductions. Inflation is contained, which gives the European Central Bank room to ease. We remain fairly negative on Japan. Its economy should continue to weaken. Consumer confidence remains low despite huge fiscal stimulus packages that have swelled public debt, while still more public spending will be needed to support Japan's ailing banks. The government is meanwhile taking a "go-slow" approach to fixing the banking system, which isn't helping matters. Q Where do you see value in the bond Q market today? Bill: We'll continue to focus on higher quality, longer duration investments. Most of our higher-quality exposure will come from mortgage-backed securities, as the Treasury market has fully priced in the effects of further Fed easing. Where possible, we intend to keep duration above-benchmark as current monetary policy effectively caps long-term interest rates. While we remain defensive in high yield, we may look to take advantage of select opportunities in the corporate sector as signs of a recovery emerge. In the current environment, core European bonds offer compelling value because the yields offered don't fully price in the anticipated slowdown in the region. Yields on the short end are particularly attractive because of anticipated easing by the European Central Bank. Although our long position on the Euro has not been positive, we think it will gain in value given the current weakness in the U.S. Q Finally, Bill, what about the long-term Q prospects for the financial markets? Bill: I think we're at an important juncture in the economy that's pointing toward lower corporate profits and a swing back to long-run historical return averages for the financial markets over the next several years. That means something along the lines of 6-7% returns for bonds and 8-9% for stocks. In terms of structural influences on the economy, "New Age" technology and globalization trends have accelerated competition --a positive development for the consumer due to lower inflation but a negative one for U.S. corporate profit margins. You also have to consider the reverse-wealth effect I alluded to earlier. Greater savings mean less overall consumption and less economic activity, so the days of 5-6% GDP growth are likely to turn into 2-3% this decade, which will keep the financial markets from growing at the pace we've seen over the last several years. There's also a demographic shift underway, with the boomer generation beginning to move out of stocks and into fixed income. This marginal decline in demand won't help equity prices and, with relatively low interest rates holding sway, total returns for fixed income are also limited. In short, we're entering an era of diminished expectations, and investors would be wise to plan for their long-term financial needs with this reality in mind. . Monthly on the Web Each month, Bill Gross and Paul McCulley offer their insights on the economy and the markets. Be sure to check out their newsletters, Investment Outlook and Fed Focus, online at www.pimcofunds.com. Since the personal savings rate in the U.S. is so low, it means the economy isn't likely to get a boost from consumers any time soon. Personal savings as a percentage of disposable income. [GRAPH] [PLOT POINTS TO COME] Source: Goldman Sachs. * Source: net assets by Simfund as of 3/31/01. Past performance is no guarantee of future results. The views of Mr. Gross and Mr. McCulley are not indicative of the past or future performance of any PIMCO Funds. These charts are not indicative of the past or future performance of any PIMCO Fund. There is no guarantee that these or any other investment techniques will be effective under all market conditions. Please see the prospectus for more complete information on the PIMCO Total Return Fund & Real Return Bond Fund. Spring 2001 | access 7 quick takes What's happening at PIMCO? Read on for the latest news from PIMCO Funds, including media highlights, fund updates, company announcements and more. BOND SMARTS The unparalleled leadership PIMCO has in the fixed-income marketplace was detailed in this November 2000 Mutual Funds magazine article. As part of the piece, Bill Gross and his portfolio management team, including Paul McCulley, were highlighted for their accurate interest rate calls and index-beating performance. The article goes as far as saying, "pension fund managers, financial advisors, and individual investors regard investing in PIMCO's roster of 15 domestic and international bond funds as a foregone conclusion." [GRAPHIC] PIMCO Funds: Pacific Investment Management Series Annual Report dated March 31, 2001 The line graph inserted at the top of page 7 in the section "Economic Outlook" is entitled "Personal Savings as a percentage of disposable income" and illustrates the fact that personal savings are declining. The graph shows one line representing the 3-month moving average (%) of personal savings over the period from mid-1997 through mid-2000. TURNING VALUE INTO A GOLD MINE This December 18th Business Week article on John Schneider, manager of PIMCO Value and PIMCO Renaissance Funds, reports that he was "right in the market's sweet spot this year." In the piece, Mr. Schneider discusses his value investing philosophy, his strategy for the year and his outlook for various sectors of the stock market. . Keep current at www.pimocofunds.com To get the latest updates from PIMCO, be sure to check out the News column on our Home page. There, we'll post breaking PIMCO news, including any important announcements related to your investment. PIMCO TOTAL RETURN IS AMERICA'S BEST-SELLING MUTUAL FUND According to industry reports, PIMCO Total Return Fund was the country's best-selling mutual fund in the first quarter of 2000. As Reuters stated (4/26/01), "...the $38 billion king of bond funds, the PIMCO Total Return Fund, outsold all other stock and bond funds for the three consecutive months--a rare occurrence in the mutual fund industry." WSJ CHANGES FUND LISTING CRITERIA If you're perusing the mutual fund tables in the Wall Street Journal and no longer find a PIMCO Fund listed--don't worry! The newspaper recently decided to reduce the number of mutual fund prices it publishes. Now, only funds with $50 million or more in assets are listed. With over 12,000 active mutual funds in the U.S. marketplace (Morningstar, 3/31/01), it's easy to understand why they can't print them all! Remember, daily pricing for all PIMCO Funds is always available through our Web site, www.pimco-funds.com. Or, you can contact your financial advisor. Certain products & services may not be offered at certain broker/dealers. The opinions expressed in the articles mentioned will contain the current opinions of the managers and do not represent a recommendation of any particular security, strategy or investment product. Such opinions are subject to change without notice. These articles are distributed for educational purposes and should not be considered investment advice. The average annual total return measures performance assuming that all dividend and capital gain distributions were reinvested. "Best-selling mutual fund" based on new net flows calculated by Simfund as of 3/31/01. 8 access | Spring 2001 Six Tried-and-True Principles for Any Investor Having a firm grasp of some investing fundamentals can help you set realistic goals and stick to your financial plan. The professionals at PIMCO Funds have compiled the following set of time-tested investment principles, which they themselves adhere to. Review them with your financial advisor, who can help you establish your own, personal investment approach. 1 KEEP A LONG-TERM VIEW Keep in mind the historical returns of stocks and bonds (about 11.0% and 5.7%, respectively) when setting your financial goals. Treat any outperformance as a bonus. Remember--time is your ally! By focusing on long-term results, you'll find it easier to ride out short-term volatility. 2 BE DISCIPLINED Often the most successful portfolio managers are those that follow a proven investment process. The key is that they choose an investment discipline and adhere to it. By establishing a clear financial plan, you'll have a logical framework for your own financial decisions. 3 INVEST RESPONSIBLY Define your objectives and risk tolerance and consider them hard and fast parameters. While making big bets can sometimes reap big rewards, they often lead to steep losses instead. That's why many top portfolio managers, like those at PIMCO, look to optimize the balance between risk and reward. 4 UNDERSTAND WHAT YOU INVEST IN If you can't explain in simple terms why you're investing in a particular security, you should rethink the investment. And you should always have a clear understanding of any risks involved. Your financial advisor should prove an invaluable resource along these lines. 5 STAY DIVERSIFIED No one can predict the next top-performing asset class. That's why the importance of asset allocation is virtually undisputed. To achieve broad diversification, you should invest your assets across different sectors and industries as well as different asset classes. Remember to periodically rebalance to ensure the proper mix. 6 KNOW THE VALUE OF PROFESSIONAL ADVICE A more challenging investment climate has dissuaded many investors from trying to go it alone. That's why more and more investors are turning to professional management. And of course, a financial advisor can help you construct a solid financial plan, make sound investment choices, and guide you through times of volatility. Past performance is no guarantee of future results. Diversification does not ensure against loss. There is no guarantee that these investment strategies will work under all market conditions and each investor should evaluate their ability to invest for a long term especially during periods of downturn in the market. Historical stock and bond returns are represented by the S&P 500 Index & Long-Term Government Bonds for the 1926-2000 period. Source: Ibbotson. It is not possible to invest directly in an unmanaged index. Spring 2001 | access 9 [GRAPHIC] Morningstar chose two bond funds for its 401(k) plan. And they're both ours. For more information on PIMCO's complete range of bond funds, including PIMCO Total Return and High Yield Funds, call your financial advisor today. [LOGO OF PIMCO FUNDS] Past performance is no guarantee of future results. Selection of these funds by Morningstar was not based solely on performance. Morningstar chose institutional class shares for use in its plan. Expense ratios differ by share class. For additional details on the PIMCO Funds, call for a free prospectus that contains more complete information including charges and expenses. Please read this information carefully before you invest or send money. MARCH 31, 2001 Annual Report Pacific Investment Management Series Share Classes A B C SHORT DURATION BOND FUNDS Money Market Fund Short-Term Fund Low Duration Fund INTERMEDIATE DURATION BOND FUNDS Total Return Fund Total Return Mortgage Fund LONG DURATION BOND FUNDS Long-Term U.S. Government Fund INFLATION-INDEXED BOND FUNDS Real Return Bond Fund TAX-EXEMPT BOND FUNDS Municipal Bond Fund California Interm. Municipal Bond Fund California Municipal Bond Fund New York Municipal Bond Fund INTERNATIONAL BOND FUNDS Global Bond Fund II Foreign Bond Fund Emerging Markets Bond Fund HIGH YIELD BOND FUNDS High Yield Fund CONVERTIBLE FUNDS Convertible Fund STOCK AND BOND FUNDS Strategic Balanced Fund ENHANCED INDEX STOCK FUNDS StocksPLUS Fund [LOGO OF PIMCO FUNDS] Table of Contents Chairman's Letter ........................................................... 3 Fund Summaries ........................................................... 4-39 Schedules of Investments ............................................... 41-129 Fund Schedule of Fund Summary Investments California Interm. Muni. Bond Fund ...................... 4 ............... 41 California Municipal Bond Fund .......................... 6 ............... 44 Convertible Fund. ....................................... 8 ............... 46 Emerging Markets Bond Fund .............................. 10 ............... 48 Foreign Bond Fund ....................................... 12 ............... 50 Global Bond Fund II ..................................... 14 ............... 56 High Yield Fund ......................................... 16 ............... 62 Long-Term U.S. Government Fund .......................... 18 ............... 68 Low Duration Fund ....................................... 20 ............... 72 Money Market Fund ....................................... 22 ............... 80 Municipal Bond Fund ..................................... 24 ............... 81 New York Municipal Bond Fund ............................ 26 ............... 84 Real Return Bond Fund ................................... 28 ............... 85 Short-Term Fund ......................................... 30 ............... 89 StocksPLUS Fund ......................................... 32 ............... 93 Strategic Balanced Fund ................................. 34 ............... 97 Total Return Fund ....................................... 36 ............... 98 Total Return Mortgage Fund .............................. 38 ...............128 Financial Highlights .................................................. 130-139 Statements of Assets and Liabilities .................................. 140-142 Statements of Operations .............................................. 143-145 Statements of Changes in Net Assets ................................... 146-150 Statements of Cash Flows .................................................. 151 Notes to Financial Statements ......................................... 152-160 [PHOTO] Dear Shareholder: It's a good time to be a bond manager. Against the backdrop of a languishing U.S. stock market, the Lehman Brothers Aggregate Bond Index, considered to be representative of the bond market as whole, returned 12.53% in the past 12 months. These strong results surely demonstrate that bonds can be as much a vehicle for capital appreciation as they are a source of income and stability. They also underscore the importance of portfolio diversification. The 59.76% and 21.68% declines of the NASDAQ and S&P 500 Index since this time last year have rattled many investors. If you're among them, remember--the theory of asset allocation holds that different asset classes will outperform and underperform at different times. That's why it's so important to diversify your investments across stocks, bonds and cash, as well as different sectors and investment styles. Above all, you should work with your financial advisor to develop a sound investment plan--and then stick to it. Time in the market has proven to be far more significant than timing the market when it comes to long-term investment performance. Be assured that each of the PIMCO Funds in this report seeks to moderate risk by diversifying across a range of securities that meets its investment objective. As to our Funds' performance this past year, I'm pleased to once again report strong relative results across the board. I encourage you to review the fund information and commentaries on the following pages carefully. If you have any questions, contact your financial advisor or call us at 1-800-426-0107. And be sure to visit our Web site at www.pimcofunds.com. As always, thank you for the trust you've placed in us. Sincerely, /s/ Brent R. Harris Brent R. Harris Chairman of the Board April 28, 2001 3.31.01 | PIMCO Funds Annual Report 3 A TAX-EXEMPT BOND FUND PIMCO CA Intermediate Municipal Bond Fund OBJECTIVE: Seek high current income exempt from federal and California income tax. PORTFOLIO: Intermediate maturity municipal securities. DURATION RANGE: 3-7 years FUND INCEPTION DATE: 8/31/99 TOTAL NET ASSETS: $118.5 million PORTFOLIO MANAGER: Mark McCray [PHOTO] Mark McCray Portfolio Manager Mr. McCray is responsible for municipal bond portfolios at PIMCO. Previously he was Co-Head of Municipal Bond Trading at Goldman Sachs & Co. and has over 10 years of investment experience. Fund Highlights . 10.19% return outperformed benchmark and Lipper Fund Average. . Fed easing and slowing economy made for a strong bond market. . High quality bias drove performance in the face of an energy crisis. . Municipals look attractive going forward. Municipals turn in a strong performance I am pleased to report that PIMCO California Intermediate Municipal Bond Fund delivered strong returns for the one-year period ended March 31, 2001, returning 10.19%. The Fund outpaced its benchmark, the Lehman California Intermediate Municipal Bond Index, which returned 9.29%, and handily beat the Lipper California Intermediate Municipal Debt Fund Category Average, which returned 8.98%. Bonds anchor the market The Fund's performance was supported by one of the strongest bond markets in recent memory. In mid-2000, the Federal Reserve discontinued its tightening campaign. Towards the end of the year, the bond market, sensing an economic slowdown and possible Fed rate cuts, pushed Treasury yields down significantly. The California municipal bond market followed suit, helped by strengthened demand for high quality amid concerns over the California energy crisis. In the first quarter of 2001, the bond market proved prescient, as the Federal Reserve slashed interest rates three times, lowering the Federal Funds rate from 6.50% to 5.00% by March 31. High quality, alternate investments, drive performance The PIMCO California Intermediate Municipal Bond Fund maintained an above-benchmark duration for most of the year, which helped returns as California municipal yields fell across all maturities. The Fund's high quality credit stance also enhanced returns. Diversification into non-California debt that qualified for California tax-exemption boosted returns as California municipal debt lagged in the latter half of the year in response to the California energy crisis. In addition, holdings of longer-term insured bonds also contributed to returns. The Fund's emphasis on longer-maturity issues, which offered attractive risk-adjusted yields, hurt performance as these yields dropped less than intermediate- and short-maturity yields. Finding value in municipals Going forward, we anticipate a global economic slowdown, with the United States leading the way. Given this environment, we believe that the bond market is poised to perform relatively well, however risks of credit erosion as the economy slows continue to argue for a bias towards higher quality assets. As for the Fund, we expect to extend duration above the benchmark in order to take advantage of falling rates in anticipation of continued U.S. economic weakness and further Fed action. We hope to emphasize longer-maturity issues, which we feel continue to offer attractive risk-adjusted yields. In order to mitigate the impact of the energy crisis, we intend to continue to invest in non-California debt that qualifies for state tax-exemption, and also increase our holdings of insured California bonds. Finally, we expect to maintain our high quality stance, as California municipal credit premiums are likely to widen given slower economic growth and higher energy prices. 4 PIMCO Funds Annual Report | 3.31.01 PIMCO CA Interm. Municipal Bond Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (8/31/99) PIMCO CA Interm. Municipal Bond Fund A Shares 10.19% -- -- -- 8.28% PIMCO CA Interm. Municipal Bond Fund A Shares (adjusted) 6.89% -- -- -- 6.22% Lipper CA Intermediate Muni. Debt Fund Avg. 8.98% -- -- -- -- Lehman Bros. CA Intermediate Insured Municipal Bond Index 9.29% -- -- -- --
MATURITY PROFILE Less than 1 year 12% 1-5 years 21% 5-10 years 41% 10-20 years 16% 20-30 years 9% Over 30 years 1% Duration 6.7 years SECTOR BREAKDOWN Municipal Bonds & Notes 99.6% Other 0.4% QUALITY BREAKDOWN AAA 52.4% AA 23.8% A 8.1% BBB 10.6% BB 5.1% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] CALIFORNIA INTERMEDIATE MUNICIPAL BOND FUND Lehman Bros. PIMCO CA CA Interm. Interm. Muni. Insured Muni. MONTH Bond A Bond Index -------------------------------------------------------------------------------- 08/31/1999 9,700 10,000 09/30/1999 9,766 10,064 10/31/1999 9,691 9,998 11/30/1999 9,770 10,080 12/31/1999 9,724 9,987 01/31/2000 9,753 10,044 02/29/2000 9,813 10,099 03/31/2000 9,986 10,247 04/30/2000 9,959 10,170 05/31/2000 10,003 10,197 06/30/2000 10,189 10,426 07/31/2000 10,320 10,569 08/31/2000 10,466 10,734 09/30/2000 10,431 10,673 10/31/2000 10,495 10,736 11/30/2000 10,543 10,784 12/31/2000 10,716 10,957 01/31/2001 10,888 11,152 02/28/2001 10,904 11,150 03/31/2001 11,004 11,200 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. Rather than stretch for maximum yield, PIMCO's municipal bond team seeks to maximize after-tax total return. The portfolio is scrutinized using a process that models the potential changes in yield and price as the underlying variables of the CA municipal marketplace change. * Past performance is no guarantee of future results. The Fund may invest at least 80% of its assets in debt securities exempt from federal income tax. The Fund may invest 10% of its assets in high yield bonds, lower-rated securities generally involve greater risk to principal than investments in higher-rated securities and may at times invest in derivatives and mortgage related securities. The Fund may invest at least 65% of its assets in bond issuers of California exempt from regular federal income tax and California income tax. The Fund may realize gains and shareholders will incur a tax liability from time to time. Income from the Fund is subject to state and local taxes & may at times be subject to the alternative minimum tax. It is important to note that a fund concentrating in a single state is subject to greater risk of adverse economic conditions and regulatory changes than a fund with broader geographical diversification. This Fund is non-diversified, which means that it may concentrate its assets in a smaller number of issuers than a diversified Fund. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 5 A TAX-EXEMPT BOND FUND PIMCO CA Municipal Bond Fund OBJECTIVE: Seek high current income exempt from federal and California income tax. PORTFOLIO: Investment grade municipal bonds. DURATION RANGE: 3-12 years FUND INCEPTION DATE: 5/16/00 TOTAL NET ASSETS: 12.7 million PORTFOLIO MANAGER: Mark McCray [PHOTO] Mark McCray Portfolio Manager Mr. McCray is responsible for municipal bond portfolios at PIMCO. Previously he was Co-Head of Municipal Bond Trading at Goldman Sachs & Co. and has over 10 years of investment experience. Fund Highlights . Fund has performed strongly since its 5/16/00 launch. . Fed easing and slowing economy made for a strong bond market. . High quality bias boosted returns in light of the CA energy crisis. . Expect to maintain our high-quality stance in anticipation of widening CA muni spreads. PIMCO California Municipal Bond Fund's primary investment objective is to seek high current income exempt from federal and California income taxes. The Fund's inception date is May 16, 2000. Bonds anchor the market In mid-2000, the Federal Reserve discontinued its tightening campaign, as the economy began to feel the effects of higher interest rates. The bond market, sensing an economic slowdown and possible Fed rate cuts, pushed Treasury yields down significantly by the end of the year. In the first quarter of 2001, the bond market proved prescient, as the Federal Reserve slashed interest rates three times, lowering the Federal Funds rate from 6.50% to 5.00% by March 31. In California, limited supply and increased demand, aggressive Fed rate cuts, and investor's preference for high quality contributed to a strong municipal debt market. Focusing on quality In keeping with our high quality stance, the Fund's average credit quality as of March 31, 2001, was AA+, with a majority of the portfolio invested in AAA-rated municipal securities and a limited allocation to lower investment-grade issues. The Fund's average maturity was 11.96 years. Finding value in municipals Going forward, we anticipate a global economic slowdown, with the United States leading the way. Given this environment, we believe that the bond market is poised to perform relatively well, however risks of credit erosion as the economy slows continue to argue for a bias towards higher quality assets. As for the Fund, we expect to extend duration above the benchmark in order to take advantage of falling rates in anticipation of continued U.S. economic weakness and further Fed action. In order to mitigate the impact of the energy crisis, we intend to invest in non-California debt that qualifies for state tax-exemption, and also increase our holdings of insured California bonds. Finally, we expect to maintain our high quality stance, as California municipal credit premiums are likely to widen given slower economic growth and higher energy prices. 6 PIMCO Funds Annual Report | 3.31.01 PIMCO CA Municipal Bond Fund Performance & Statistics CUMULATIVE TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception* (5/16/00) PIMCO CA Municipal Bond Fund A Shares -- -- -- -- 12.09% PIMCO CA Municipal Bond Fund A Shares (adjusted) -- -- -- -- 8.72% Lipper CA Municipal Debt Fund Avg. -- -- -- -- -- Lehman Bros. CA Insured Muni. Bond Index -- -- -- -- --
MATURITY PROFILE Less than 1 year 7% 1-5 years 31% 5-10 years 24% 10-20 years 15% 20-30 years 23% Duration 7.0 years SECTOR BREAKDOWN Municipal Bonds & Notes 98.2% Other 1.8% QUALITY BREAKDOWN AAA 60.6% AA 21.8% A 4.2% BBB 8.0% BB 5.4% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] CALIFORNIA MUNICIPAL BOND FUND Lehman Bros. PIMCO CA CA Insured Municipal Muni. Bond MONTH Bond A Index -------------------------------------------------------------------------------- 05/31/2000 9,700 10,000 06/30/2000 9,901 10,321 07/31/2000 10,036 10,475 08/31/2000 10,175 10,715 09/30/2000 10,147 10,658 10/31/2000 10,204 10,745 11/30/2000 10,261 10,830 12/31/2000 10,470 11,071 01/31/2001 10,626 11,175 02/28/2001 10,699 11,194 03/31/2001 10,768 11,284 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. Rather than stretch for maximum yield, PIMCO's municipal bond team seeks to maximize after-tax total return. The portfolio is scrutinized using a process that models the potential changes in yield and price as the underlying variables of the CA municipal marketplace change. * Inception returns are cumulative since the fund is less than 1 year old. Past performance is no guarantee of future results. The Fund may realize gains and shareholders will incur a tax liability from time to time. Income from the Fund is subject to state and local taxes & may at times be subject to the alternative minimum tax. The Fund may invest up to 10% in high-yield lower- rated securities, which generally involves greater risk to principal than higher-rated bonds. The Fund may also invest in derivative instruments and mortgage-backed securities. It is important to note that a fund concentrating in a single state is subject to greater risk of adverse economic conditions and regulatory changes than a fund with broader geographical diversification. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 7 A CONVERTIBLE FUND PIMCO Convertible Fund OBJECTIVE: Maximum total return. PORTFOLIO: Convertible securities. DURATION RANGE: N/A FUND INCEPTION DATE: 3/31/99 TOTAL NET ASSETS: $91.7 million PORTFOLIO MANAGER: Sandra Durn [PHOTO] Sandra Durn Portfolio Manager Ms. Durn is head of convertible bond strategies at PIMCO. Previously the lead convertible securities portfolio manager at Nicholas-Applegate Capital Management, she has seven years of investment experience. Fund Highlights . Although the Fund has performed strongly since inception, it trailed its benchmark for the 1-year period. . Stock market correction hurt convertibles as defaults and downgrades increased within the corporate bond market. . Will continue to emphasize quality while looking to take advantage of attractively valued issues that are poised to recover. Tough times all around PIMCO Convertible Fund had a difficult year, with Class A shares declining 22.68% for the one-year period ended March 31, 2001. This performance trailed the Fund's benchmark, the First Boston Convertibles Index, which fell 18.84%, and underperformed the average for its Lipper category, which fell 15.31%. The Fund does, however, continue to outperform over the longer term, beating both its benchmark and its Lipper category average since inception. Equity losses spread to convertibles Slow growth in the U.S., combined with three rate cuts by the Federal Reserve, drove Treasury yields down and bond prices up over the past year. That same slow growth, combined with a flight to quality, severely hurt returns in the equity markets. These losses spread to the convertible universe, as the First Boston Convertible Index slid almost as much as the S&P 500 over the past year. Generally, higher quality convertible securities outperformed lower quality issues as defaults and downgrades increased within the corporate bond market. Low delta contains losses PIMCO Convertible Fund's below-index delta, or its sensitivity to underlying stock prices, helped returns amid sharp declines in global equity markets. The Fund's high quality stance, emphasizing investment-grade convertibles, was positive for returns as investors sought the downside protection that these issues offer. The Fund's exposure to telecom and technology issues was, however, rough on performance as these industries suffered from disappointing earnings and pressure on profit margins amid slower capital investment by businesses both in the U.S. and abroad. Economic weakness in the near term We believe that the U.S. economy will continue to struggle over the next two or three quarters, leading a worldwide slowdown. Banks throughout the world, including our own Federal Reserve, will cut interest rates in order to mitigate this slowdown. In general, we expect bonds to perform relatively well in this environment, with the strength of the bond market providing protection as the investment value of convertibles begins to stabilize. We intend to maintain PIMCO Convertible Fund's emphasis on high quality, holding mostly investment-grade convertibles, as these issues offer relatively significant downside protection. We plan to target the Fund's delta below-index to minimize the impact of potentially adverse equity market performance while keeping an eye toward companies in the technology and telecom sectors that are poised to recover from the market correction and that offer compelling valuations. The Fund will continue to invest in non-cyclical sectors such as healthcare that are relatively immune from the economic slowdown. 8 PIMCO Funds Annual Report | 3.31.01 PIMCO Convertible Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (3/31/99) PIMCO Convertible Fund A Shares -22.68% -- -- -- 11.34% PIMCO Convertible Fund A Shares (adjusted) -26.16% -- -- -- 8.81% PIMCO Convertible Fund B Shares -23.24% -- -- -- 10.43% PIMCO Convertible Fund B Shares (adjusted) -26.86% -- -- -- 8.61% PIMCO Convertible Fund C Shares (adjusted) -23.93% -- -- -- 10.51% Lipper Convertible Securities Fund Avg. -15.31% -- -- -- -- First Boston Convertible Bond Index -18.84% -- -- -- --
MATURITY PROFILE Less than 1 year 18% 1-5 years 37% 5-10 years 1% 10-20 years 36% 20-30 years 8% Duration 1.3 years SECTOR BREAKDOWN Convertible Bonds & Notes 60.5% Convertible Preferred Stock 36.7% Other 2.8% QUALITY BREAKDOWN AA 8.6% A 30.9% BBB 38.8% BB 12.2% B 9.5% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] CONVERTIBLE FUND First Boston PIMCO PIMCO PIMCO Convertible MONTH Convertible A Convertible B Convertible C Bond Index -------------------------------------------------------------------------------- 03/31/1999 9,550 10,000 10,000 10,000 04/30/1999 10,006 10,471 10,471 10,405 05/31/1999 10,184 10,650 10,650 10,309 06/30/1999 10,727 11,219 11,229 10,754 07/31/1999 10,747 11,239 11,240 10,612 08/31/1999 10,727 11,199 11,209 10,643 09/30/1999 10,833 11,308 11,319 10,671 10/31/1999 11,263 11,747 11,758 11,040 11/30/1999 12,084 12,595 12,607 11,888 12/31/1999 13,523 14,083 14,105 13,695 01/31/2000 13,814 14,346 14,357 13,489 02/29/2000 15,285 15,871 15,882 14,905 03/31/2000 15,314 15,885 15,904 14,584 04/30/2000 14,283 14,811 14,831 13,873 05/31/2000 13,836 14,334 14,355 13,129 06/30/2000 14,585 15,107 15,117 13,982 07/31/2000 14,156 14,661 14,671 13,560 08/31/2000 15,246 15,765 15,785 14,603 09/30/2000 14,991 15,531 15,545 14,396 10/31/2000 14,297 14,799 14,812 13,734 11/30/2000 12,497 12,937 12,943 12,071 12/31/2000 13,421 13,882 13,897 12,623 01/31/2001 13,825 14,258 14,272 13,363 02/28/2001 12,325 12,700 12,717 12,339 03/31/2001 11,840 11,795 12,212 11,837 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The portfolio's risk/reward profile is then dynamically managed in order to modestly participate with rising equity prices while protecting against declines. Disciplined company/credit analysis maximizes the portfolio's capital appreciation potential. * Past performance is no guarantee of future results. The Fund may invest up to 35% of its assets in high yield securities which are lower rated securities, 20% in foreign currencies which can involve special risks due to foreign economic and political developments, emerging markets, and investing in smaller companies. The Fund may have to convert securities before it would otherwise choose to, which may have an adverse effect on the Fund's ability to achieve its investment objective. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 9 AN INTERNATIONAL BOND FUND PIMCO Emerging Markets Bond Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management (non-U.S.). PORTFOLIO: Primarily emerging markets bonds. DURATION RANGE: 0-8 years FUND INCEPTION DATE: 7/31/97 TOTAL NET ASSETS: $57.6 million PORTFOLIO MANAGER: Mohamed El-Erian [PHOTO] Mohamed El-Erian Portfolio Manager Dr. El-Erian is a managing director and head of the firm's emerging markets portfolio management team. His past experience includes 15 years with the IMF leading policy work on debt and country issues. Fund Highlights . 12.46% return soundly beat Lipper Average. . Slowing worldwide growth pushed emerging markets bonds higher. . Underweight exposure to Argentina proved to be a prescient move. . Expect higher-quality bonds to perform relatively well in the months ahead. Emerging Markets post strong year PIMCO Emerging Markets Bond Fund delivered strong results for its shareholders, with Class A shares returning 12.46% for the one-year period ended March 31, 2001. This performance outpaced the Fund's benchmark, the J.P. Morgan Emerging Markets Bond Index, which returned 9.65%, and soundly beat the Lipper Emerging Markets Debt Fund Average's return of 5.22%. Slowing growth boosts bonds Emerging market bonds thrived on signs of a slowing economy worldwide, led by the U.S. and the three Federal Reserve rate cuts totaling 150 basis points. Emerging markets bonds performed well for most of the year, buoyed by improved economic fundamentals, stronger economic growth, improvements in liability management, and successful conclusions to debt restructuring. Concerns about possible contagion effects from problem countries such as Argentina and Turkey, however, dragged the sector down in early 2001. Steering clear of Argentina proves wise PIMCO Emerging Markets Bond Fund's performance was greatly helped by our underweight position relative to the benchmark in Argentina, as continued financial deterioration, political uncertainty and weakening growth weighed heavily on the market. The Fund's overweight in Brazil also helped returns due to improved liability management, low inflation, strong economic growth and aggressive central bank easings. An emphasis in Bulgaria further boosted returns as it received a favorable ratings upgrade and its political situation stabilized. The Fund's overweight in Peru was mostly negative for performance during the year as the political situation there became uncertain and the country had a temporary disruption of its Brady Bond payments. This was mitigated by an agreement with the IMF on an economic program for 2001. Quality the key We believe that worldwide economic growth will continue to slow. Banks throughout the world, including our own Federal Reserve, will cut interest rates in order to mitigate this slowdown. In general, we expect bonds to perform relatively well in this environment, especially within the higher quality segment. In particular, countries with demonstrably sustainable economic growth and stable political situations should excel. We expect to maintain PIMCO Emerging Markets Bond Fund's high quality bias, keeping its average credit quality above the benchmark. We intend to keep underweight positions in Argentina and Turkey as both countries will continue wrestling with domestic challenges. Meanwhile, we hope to continue overweighting Brazil, where positive fundamentals will likely more than offset short term regional volatility, and to modestly overweight Mexico, given its continued economic improvement and the high probability of a ratings upgrade. We will also continue our strategy of seeking opportunities in non-index countries, and owning issues with high liquidity that provide the flexibility necessary in order to react to dynamic changes in emerging market economies. 10 PIMCO Funds Annual Report | 3.31.01 PIMCO Emerging Markets Bond Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (7/31/97) PIMCO Emerging Markets Bond Fund A Shares 12.46% 7.66% -- -- 7.04% PIMCO Emerging Markets Bond Fund A Shares (adjusted) 7.40% 6.02% -- -- 5.71% PIMCO Emerging Markets Bond Fund B Shares 11.59% 6.83% -- -- 6.21% PIMCO Emerging Markets Bond Fund B Shares (adjusted) 6.71% 6.06% -- -- 5.62% PIMCO Emerging Markets Bond Fund C Shares (adjusted) 10.76% 6.90% -- -- 6.27% Lipper Emerging Markets Debt Fund Average 5.22% 1.82% -- -- -- J.P. Morgan Emerging Markets Bond Index Plus 9.65% 6.57% -- -- --
MATURITY PROFILE Less than 1 year 30% 1-5 years 7% 5-10 years 26% 10-20 years 18% 20-30 years 15% Over 30 years 4% Duration 5.0 years COUNTRY ALLOCATION Brazil 28.7% Mexico 19.8% Russia 13.2% Venezuela 5.8% Short-Term Instruments 5.1% Other 27.4% QUALITY BREAKDOWN AAA 4.9% AA 1.1% BBB 41.6% BB 43.7% B 8.7% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] EMERGING MARKETS BOND FUND PIMCO Emerging PIMCO Emerging PIMCO Emerging J.P. Morgan Emerging MONTH Markets A Markets B Markets C Markets Bond Index -------------------------------------------------------------------------------- 07/31/1997 9,550 10,000 10,000 10,000 08/31/1997 9,434 9,870 9,872 9,960 09/30/1997 9,693 10,134 10,135 10,264 10/31/1997 8,587 8,970 8,971 9,082 11/30/1997 9,038 9,436 9,437 9,513 12/31/1997 9,266 9,668 9,669 9,841 01/31/1998 9,277 9,673 9,674 9,822 02/28/1998 9,538 9,940 9,941 10,103 03/31/1998 9,822 10,228 10,229 10,354 04/30/1998 9,844 10,245 10,245 10,379 05/31/1998 9,524 9,905 9,905 10,025 06/30/1998 9,209 9,571 9,571 9,735 07/31/1998 9,347 9,706 9,706 9,802 08/31/1998 6,741 6,994 6,994 6,985 09/30/1998 7,263 7,531 7,532 7,668 10/31/1998 7,641 7,916 7,919 8,165 11/30/1998 8,250 8,542 8,544 8,645 12/31/1998 8,147 8,430 8,432 8,429 01/31/1999 7,862 8,130 8,133 8,117 02/28/1999 8,016 8,285 8,288 8,233 03/31/1999 8,556 8,838 8,840 8,857 04/30/1999 9,267 9,565 9,569 9,462 05/31/1999 8,684 8,959 8,961 8,922 06/30/1999 8,943 9,221 9,224 9,321 07/31/1999 8,883 9,153 9,155 9,128 08/31/1999 8,867 9,129 9,133 9,115 09/30/1999 9,260 9,529 9,533 9,434 10/31/1999 9,557 9,828 9,832 9,798 11/30/1999 9,814 10,087 10,090 10,075 12/31/1999 10,273 10,552 10,556 10,620 01/31/2000 10,044 10,310 10,314 10,410 02/29/2000 10,635 10,911 10,915 11,080 03/31/2000 10,899 11,175 11,184 11,429 04/30/2000 10,690 10,947 10,970 11,211 05/31/2000 10,479 10,724 10,746 10,925 06/30/2000 10,969 11,218 11,242 11,479 07/31/2000 11,232 11,481 11,505 11,826 08/31/2000 11,621 11,872 11,897 12,243 09/30/2000 11,465 11,705 11,729 12,077 10/31/2000 11,270 11,499 11,523 11,805 11/30/2000 11,325 11,548 11,572 11,745 12/31/2000 11,723 11,945 11,971 12,284 01/31/2001 12,217 12,441 12,467 12,911 02/28/2001 12,159 12,378 12,405 12,706 03/31/2001 12,259 12,219 12,497 12,532 Investment Process The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The manager is guided by risk-adjusted real yields. His goal is to identify not only which countries to overweight or underweight, but where on each country's yield curve the Fund should take an exposure. * Past performance is no guarantee of future results. This Fund may invest at least 80% of its assets in issuers that economically are tied to countries with emerging securities markets. Investing in foreign securities may entail greater risk due to foreign economic and political developments, this risk may be enhanced when investing in emerging markets. The Fund may also invest in high yield securities, lower-rated securities generally involve greater risk to principal than investments in higher-rated securities and may at times invest in derivatives. This Fund is non-diversified, which means that it may concentrate its assets in a smaller number of issuers than a diversified Fund. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 11 AN INTERNATIONAL BOND FUND PIMCO Foreign Bond Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management (non-U.S.). PORTFOLIO: Primarily investment grade foreign bonds. DURATION RANGE: 3-7 years FUND INCEPTION DATE: 12/02/92 TOTAL NET ASSETS: $674.8 million PORTFOLIO MANAGER: Sudi Mariappa Sudi Mariappa Portfolio Manager Mr. Mariappa is lead portfolio manager of PIMCO Foreign Bond and Global Bond II Funds and oversees the firm's Asian trading and portfolio management group in Japan. He has 14 years of investment experience. Fund Highlights . 10.82% return betters benchmark and Lipper Average. . Central bank actions and a volatile Euro caused market opportunities to shift throughout the year. . European exposure boosted returns due to a year-end rally. . Continued global slowdown could lead to central bank rate cuts, creating a positive environment for foreign bonds. Staying ahead of the pack I am pleased to report that PIMCO Foreign Bond Fund had a strong twelve months, with Class A shares posting a 10.82% return for the year ending March 31, 2001. This performance surpassed the returns of the Fund's benchmark and its Lipper Average. The Foreign Bond Fund has now significantly outperformed its Lipper Average for the 1-, 3-, 5-year and since-inception periods. The year's ups and downs Foreign bond markets offered a mixed bag of opportunities during the year. Japan is a perfect example. Japanese bonds underperformed in 2000, but aggressive actions by the Bank of Japan in the first quarter of 2001 allowed the country's bond market to finish on a high. European bonds were also up and down during the year. A record low Euro dragged down Europe's bond market for most of 2000, until the currency's comeback late in 2000 drew capital back to European markets. But investor confidence fell again in the beginning of 2001 when the European Central Bank (ECB) unexpectedly failed to cut rates. Emerging markets bonds showed some strength in 2000 but interest quickly cooled off as investors became more risk averse and more concerned about credit problems in Turkey and Argentina. European bonds provide lift The Fund's overweight position in core European bonds boosted performance due to an end-of-year rally in the European bond markets. Short-term exposure was particularly beneficial because of the expectations that early-maturity interest rates had peaked. Extending the Fund's average duration late in the year was also a positive as yields fell worldwide in response to slower growth. Our underweight position in Japan relative to the benchmark hurt overall returns as Japanese Government Bonds maintained their strong performance with the Japanese economy continuing to flounder. The Fund's fairly small long position in the Euro also detracted from performance, since the currency fell amidst concern that the ECB would keep interest rates relatively high, limiting growth prospects. Opportunities going forward Looking ahead, we expect to see improving foreign bond market opportunities. We believe global growth will continue to slow as the economic downturn in the U.S. spreads to other countries. Global central banks will likely try to help by cutting rates, and they will probably do so more aggressively than investors currently anticipate. This should create a good environment for foreign bonds. To succeed in this market, we intend to maintain an above-benchmark duration for the Fund and focus on shorter maturities. In terms of country allocations, we plan to overweight core Europe and the U.K., underweight Japan, and remain cautious toward emerging markets bonds. 12 PIMCO Funds Annual Report | 3.31.01 PIMCO Foreign Bond Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (12/2/92) PIMCO Foreign Bond Fund A Shares 10.82% 6.51% 9.69% -- 9.43% PIMCO Foreign Bond Fund A Shares (adjusted) 5.83% 4.89% 8.69% -- 8.83% PIMCO Foreign Bond Fund B Shares 9.94% 5.72% 8.88% -- 8.76% PIMCO Foreign Bond Fund B Shares (adjusted) 4.94% 4.85% 8.60% -- 8.76% PIMCO Foreign Bond Fund C Shares (adjusted) 8.96% 5.70% 8.88% -- 8.62% Lipper International Income Fund Avg. 0.00% 1.71% 2.82% -- -- J.P. Morgan Non-U.S. Index (Hedged) 10.36% 7.91% 9.92% -- --
MATURITY PROFILE Less than 1 year 22% 1-5 years 19% 5-10 years 59% Duration 6.0 years COUNTRY ALLOCATION United States 40.5% Germany 11.9% Italy 9.4% France 6.6% Canada 6.0% Short-Term Instruments 6.6% Other 19.0% QUALITY BREAKDOWN AAA 67.4% AA 21.1% A 4.9% BBB 3.9% BB 2.7% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] FOREIGN BOND FUND J.P. Morgan Non-U.S. PIMCO PIMCO PIMCO Index MONTH Foreign A Foreign B Foreign C (Hedged) -------------------------------------------------------------------------------- 12/31/1992 9,550 10,000 10,000 10,000 01/31/1993 9,625 10,073 10,073 10,091 02/28/1993 9,833 10,286 10,286 10,274 03/31/1993 9,867 10,314 10,314 10,280 04/30/1993 9,863 10,304 10,304 10,281 05/31/1993 9,949 10,387 10,387 10,338 06/30/1993 10,180 10,623 10,623 10,549 07/31/1993 10,337 10,781 10,781 10,667 08/31/1993 10,584 11,033 11,033 10,889 09/30/1993 10,622 11,067 11,067 10,936 10/31/1993 10,776 11,221 11,221 11,082 11/30/1993 10,803 11,242 11,242 11,159 12/31/1993 11,068 11,511 11,511 11,390 01/31/1994 11,079 11,515 11,515 11,333 02/28/1994 10,782 11,200 11,200 11,078 03/31/1994 10,590 10,994 10,994 10,977 04/30/1994 10,486 10,879 10,879 10,899 05/31/1994 10,329 10,709 10,709 10,779 06/30/1994 10,135 10,501 10,501 10,669 07/31/1994 10,195 10,557 10,557 10,739 08/31/1994 10,091 10,442 10,442 10,636 09/30/1994 10,104 10,448 10,448 10,645 10/31/1994 10,139 10,477 10,477 10,687 11/30/1994 10,285 10,622 10,622 10,838 12/31/1994 10,214 10,541 10,541 10,813 01/31/1995 10,280 10,601 10,601 10,931 02/28/1995 10,343 10,660 10,660 11,072 03/31/1995 10,347 10,656 10,656 11,297 04/30/1995 10,596 10,905 10,905 11,477 05/31/1995 11,008 11,322 11,322 11,854 06/30/1995 10,938 11,243 11,243 11,814 07/31/1995 11,142 11,445 11,445 11,963 08/31/1995 11,351 11,651 11,651 12,067 09/30/1995 11,508 11,806 11,806 12,258 10/31/1995 11,697 11,991 11,991 12,395 11/30/1995 12,152 12,450 12,450 12,667 12/31/1995 12,328 12,623 12,623 12,785 01/31/1996 12,627 12,919 12,919 12,939 02/29/1996 12,354 12,632 12,632 12,787 03/31/1996 12,550 12,826 12,826 12,893 04/30/1996 12,850 13,125 13,125 13,047 05/31/1996 12,895 13,163 13,163 13,136 06/30/1996 13,037 13,299 13,299 13,245 07/31/1996 13,160 13,417 13,417 13,345 08/31/1996 13,478 13,733 13,733 13,522 09/30/1996 13,851 14,107 14,107 13,810 10/31/1996 14,189 14,442 14,442 14,038 11/30/1996 14,528 14,780 14,780 14,319 12/31/1996 14,601 14,845 14,845 14,339 01/31/1997 14,826 15,067 15,070 14,518 02/28/1997 14,900 15,133 15,136 14,611 03/31/1997 14,708 14,929 14,932 14,533 04/30/1997 14,840 15,054 15,057 14,690 05/31/1997 14,912 15,117 15,120 14,767 06/30/1997 15,205 15,406 15,409 15,018 07/31/1997 15,424 15,619 15,622 15,257 08/31/1997 15,356 15,539 15,542 15,275 09/30/1997 15,683 15,859 15,862 15,545 10/31/1997 15,495 15,658 15,661 15,645 11/30/1997 15,700 15,856 15,860 15,757 12/31/1997 15,924 16,072 16,075 15,962 01/31/1998 16,149 16,289 16,292 16,174 02/28/1998 16,293 16,424 16,428 16,318 03/31/1998 16,491 16,615 16,618 16,464 04/30/1998 16,542 16,666 16,660 16,548 05/31/1998 16,680 16,793 16,786 16,774 06/30/1998 16,756 16,860 16,853 16,847 07/31/1998 17,016 17,111 17,104 17,003 08/31/1998 16,875 16,959 16,952 17,338 09/30/1998 17,256 17,332 17,325 17,749 10/31/1998 16,894 16,956 16,949 17,722 11/30/1998 17,205 17,258 17,251 17,914 12/31/1998 17,441 17,482 17,475 17,892 01/31/1999 17,793 17,825 17,818 18,114 02/28/1999 17,613 17,634 17,627 17,993 03/31/1999 17,715 17,726 17,719 18,207 04/30/1999 17,938 17,937 17,930 18,438 05/31/1999 17,651 17,639 17,632 18,363 06/30/1999 17,431 17,406 17,399 18,078 07/31/1999 17,433 17,397 17,391 18,031 08/31/1999 17,302 17,257 17,250 18,063 09/30/1999 17,388 17,333 17,326 18,132 10/31/1999 17,461 17,395 17,388 18,176 11/30/1999 17,489 17,412 17,405 18,281 12/31/1999 17,636 17,546 17,539 18,336 01/31/2000 17,539 17,450 17,432 18,338 02/29/2000 17,734 17,644 17,615 18,473 03/31/2000 17,982 17,891 17,848 18,743 04/30/2000 18,038 17,946 17,885 18,844 05/31/2000 18,141 18,048 17,975 18,995 06/30/2000 18,271 18,178 18,092 19,086 07/31/2000 18,419 18,326 18,227 19,224 08/31/2000 18,395 18,302 18,191 19,227 09/30/2000 18,631 18,536 18,413 19,393 10/31/2000 18,672 18,577 18,442 19,550 11/30/2000 18,943 18,846 18,699 19,896 12/31/2000 19,289 19,191 19,028 20,117 01/31/2001 19,569 19,469 19,292 20,355 02/28/2001 19,675 19,574 19,387 20,530 03/31/2001 19,932 19,831 19,627 20,685 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The manager then uses a top-down country bond allocation model to determine the countries with the best risk-adjusted yields. Bottom-up strategies, including sector rotation and credit research, aid in issue selection. * Past performance is no guarantee of future results. This Fund may invest at least 85% of its assets in foreign securities, which may entail greater risk due to foreign economic and political developments, may at times invest in derivatives and mortgage related securities. The Fund may invest up to 10% in high yield securities, lower rated securities generally involves greater risk to principal than investment in higher rated securities. This Fund is non- diversified, which means that it may concentrate its assets in a smaller number of issuers than a diversified Fund. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 13 AN INTERNATIONAL BOND FUND PIMCO Global Bond Fund II OBJECTIVE: Maximum total return, consistent with preservation of capital (U.S. and non-U.S.). PORTFOLIO: Primarily investment grade U.S. and foreign bonds. DURATION RANGE: 3-7 years FUND INCEPTION DATE: 10/02/95 TOTAL NET ASSETS: $76.1 million PORTFOLIO MANAGER: Sudi Mariappa Sudi Mariappa Portfolio Manager Mr. Mariappa is lead portfolio manager of PIMCO Foreign Bond and Global Bond II Funds and oversees the firm's Asian trading and portfolio management group in Japan. He has 14 years of investment experience. Fund Highlights . 11.43% return beat Lipper Average by a substantial margin. . U.S. was best-performing market in 2000, although global bond markets rallied later in the year. . Slow global growth could lead to central bank rate cuts, creating a positive environment for bonds worldwide. Far better than average I am very pleased to report that PIMCO Global Bond Fund II's Class A shares returned 11.43% for the year ending March 31, 2001. This strong performance was significantly better than the 2.75% return of the Lipper Global Income Fund Average and also surpassed the annual return of its benchmark. The Fund has now outperformed its Lipper Average for the 1-, 3-, 5-year and since-inception periods. U.S. led 2000 The U.S. was the best-performing bond market for most of 2000, thanks to a slowing economy and investor flight to quality. Global bond markets rallied later in the fiscal year, with Japanese Government Bonds (JGBs) in particular performing well as aggressive steps by the Bank of Japan to counter a deflationary spiral propped up its bond market. European bonds lagged for much of the year, held back by the weak Euro and the fact that the European Central Bank (ECB) was the only major bank that didn't tighten interest rates. European bonds provide lift The Fund's overweight position in core European bonds boosted performance due to an end-of-year rally in the European bond markets. Short-term exposure was particularly beneficial because of the expectations that early-maturity interest rates had peaked. Extending the Fund's average duration late in the year was also a positive as yields fell worldwide in response to slower growth. Our underweight position in Japan relative to the benchmark hurt overall returns as JGBs maintained their strong performance with the Japanese economy continuing to flounder. The Fund's fairly small long position in the Euro also detracted from performance, since the currency fell amidst concern that the ECB would keep interest rates relatively high, limiting growth prospects. Forecast good for bonds At PIMCO, we expect global growth to continue to slow. We believe global central banks will cut rates to help, and that they will do so more aggressively than investors currently anticipate. This should create a good environment for bonds. We are positioning the Global Bond Fund II by maintaining an above-benchmark duration and focusing on shorter maturities. In terms of country allocations, we plan to overweight core Europe and the U.K., remain underweight in Japan due to high debt levels, and emphasize lower coupon mortgages in the U.S. We will remain cautious toward emerging markets bonds. 14 PIMCO Funds Annual Report | 3.31.01 PIMCO Global Bond Fund II Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (10/2/95) PIMCO Global Bond Fund II A Shares 11.43% 5.84% 8.18% -- 8.72% PIMCO Global Bond Fund II A Shares (adjusted) 6.42% 4.23% 7.19% -- 7.81% PIMCO Global Bond Fund II B Shares 10.60% 5.05% 7.29% -- 7.89% PIMCO Global Bond Fund II B Shares (adjusted) 5.60% 4.16% 7.01% -- 7.77% PIMCO Global Bond Fund II C Shares (adjusted) 9.60% 5.04% 7.29% -- 7.89% Lipper Global Income Fund Average 2.75% 1.74% 4.05% -- -- J.P. Morgan Global Index (hedged) 10.85% 7.65% 9.06% -- --
MATURITY PROFILE Less than 1 year 39% 1-5 years 17% 5-10 years 44% Duration 6.7 years COUNTRY ALLOCATION United States 43.5% Germany 12.3% Italy 10.5% United Kingdom 6.4% Canada 5.5% Short-Term Instruments 2.4% Other 19.4% QUALITY BREAKDOWN AAA 70.0% AA 19.5% A 4.6% BBB 3.4% BB 2.5% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] GLOBAL BOND FUND II PIMCO PIMCO PIMCO J.P. Morgan Global Bond Global Bond Global Bond Global Index MONTH II A II B II C (Hedged) -------------------------------------------------------------------------------- 10/31/1995 9,550 10,000 10,000 10,000 11/30/1995 9,869 10,334 10,334 10,191 12/31/1995 10,030 10,502 10,502 10,302 01/31/1996 10,220 10,702 10,702 10,406 02/29/1996 10,026 10,499 10,499 10,257 03/31/1996 10,045 10,512 10,512 10,279 04/30/1996 10,170 10,625 10,625 10,334 05/31/1996 10,162 10,606 10,596 10,373 06/30/1996 10,256 10,677 10,677 10,471 07/31/1996 10,299 10,718 10,718 10,530 08/31/1996 10,552 10,964 10,964 10,614 09/30/1996 10,799 11,214 11,214 10,814 10/31/1996 11,031 11,458 11,448 11,009 11/30/1996 11,303 11,724 11,724 11,215 12/31/1996 11,274 11,697 11,686 11,188 01/31/1997 11,370 11,778 11,778 11,283 02/28/1997 11,448 11,852 11,852 11,334 03/31/1997 11,290 11,681 11,681 11,255 04/30/1997 11,424 11,812 11,812 11,392 05/31/1997 11,514 11,896 11,896 11,468 06/30/1997 11,710 12,092 12,092 11,638 07/31/1997 11,954 12,335 12,335 11,886 08/31/1997 11,910 12,282 12,282 11,844 09/30/1997 12,131 12,502 12,503 12,043 10/31/1997 11,989 12,347 12,348 12,176 11/30/1997 12,074 12,427 12,428 12,254 12/31/1997 12,208 12,558 12,559 12,405 01/31/1998 12,318 12,665 12,664 12,581 02/28/1998 12,389 12,729 12,729 12,632 03/31/1998 12,556 12,893 12,893 12,714 04/30/1998 12,610 12,941 12,941 12,777 05/31/1998 12,677 13,002 13,002 12,936 06/30/1998 12,734 13,053 13,049 13,030 07/31/1998 12,888 13,201 13,197 13,113 08/31/1998 12,750 13,052 13,048 13,412 09/30/1998 13,034 13,337 13,333 13,754 10/31/1998 12,818 13,106 13,102 13,724 11/30/1998 12,986 13,269 13,264 13,821 12/31/1998 13,097 13,373 13,369 13,821 01/31/1999 13,388 13,662 13,658 13,961 02/28/1999 13,182 13,445 13,441 13,774 03/31/1999 13,264 13,520 13,516 13,900 04/30/1999 13,390 13,641 13,636 14,031 05/31/1999 13,184 13,422 13,418 13,947 06/30/1999 13,021 13,249 13,245 13,789 07/31/1999 13,008 13,227 13,223 13,760 08/31/1999 12,948 13,158 13,154 13,775 09/30/1999 13,012 13,215 13,210 13,846 10/31/1999 13,046 13,241 13,237 13,873 11/30/1999 13,025 13,212 13,208 13,921 12/31/1999 13,080 13,259 13,255 13,922 01/31/2000 13,021 13,192 13,188 13,933 02/29/2000 13,173 13,338 13,334 14,074 03/31/2000 13,354 13,513 13,509 14,307 04/30/2000 13,372 13,524 13,519 14,343 05/31/2000 13,418 13,560 13,556 14,428 06/30/2000 13,563 13,697 13,693 14,553 07/31/2000 13,672 13,800 13,796 14,671 08/31/2000 13,707 13,826 13,822 14,739 09/30/2000 13,862 13,974 13,970 14,829 10/31/2000 13,900 14,004 13,999 14,958 11/30/2000 14,063 14,159 14,154 15,240 12/31/2000 14,229 14,316 14,312 15,448 01/31/2001 14,529 14,610 14,605 15,609 02/28/2001 14,657 14,729 14,725 15,762 03/31/2001 14,881 14,851 14,941 15,859 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The manager then uses a top-down country bond allocation model to determine the countries with the best risk-adjusted yields. Bottom-up strategies, including sector rotation and credit research, aid in issue selection. * Past performance is no guarantee of future results. The Fund may invest at least 65% of its assets in three countries (one of which may be the U.S.), which may entail greater risk due to foreign economic and political developments. The Fund may also invest 10% in high yield securities, lower- rated securities generally involve greater risk to principal than investments in higher-rated securities and may at times invest in derivatives and mortgage related securities. This Fund is non-diversified, which means that it may concentrate its assets in a smaller number of issuers than a diversified Fund. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 15 A HIGH YIELD BOND FUND PIMCO High Yield Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management. PORTFOLIO: Primarily high yield bonds. DURATION RANGE: 2-6 years FUND INCEPTION DATE: 12/15/92 TOTAL NET ASSETS: $2.6 billion PORTFOLIO MANAGER: Ben Trosky [PHOTO] Ben Trosky Portfolio Manager Mr. Trosky is a Managing Director and a senior member of PIMCO's portfolio management and investment strategy groups. He has over 20 years of investment experience. Fund Highlights . 5.44% return outperformed Lipper Average, which returned -3.20%. . Although rising default rates hurt the sector, Fed rate cuts sparked a high yield rally in early 2001. . High credit quality exposure was key to the Fund's solid returns. . Continue to favor relatively high quality going forward. Outpacing Lipper Average It is my pleasure to report that PIMCO High Yield Fund Class A shares returned 5.44% for the year ending March 31, 2001, significantly outperforming the Lipper High Current Yield Funds Average return of -3.20%. The Fund did, however, underperform its benchmark, the Lehman Intermediate BB Corporate Index, which rose 11.08%. Fed sparks rally After months of deteriorating economic conditions, the Federal Reserve cut rates three times in the first quarter of 2001. This aggressive easing sparked a rally that had high yield bonds outperforming investment-grade sectors in January. Default rates continued to rise, however, and downgrades outpaced upgrades as the economy slowed further. Credit quality the key PIMCO High Yield Fund's focus on the upper credit quality tiers of the high yield market helped preserve capital and generate positive returns. An emphasis on non-cyclical industries enhanced performance as this segment was relatively immune to the economic slowdown. The Fund also benefited from its overweight position in industries with steady cash flow, such as cable operators and gaming concerns. The Fund's overweight position in telecommunications-related issues hurt performance as reduced growth and limited access to capital caused this sector to lag. The Fund's relatively low exposure to single-B-rated credits detracted from performance when compared to the benchmark as this sector benefited the most from the first-quarter spike. Quality is the watchword While the high yield market staged a strong rally to begin 2001, we remain cautious given our forecast for a continued slowdown in the U.S. economy and further contraction of corporate profits. In this environment, we believe that maintaining a defensive posture will be instrumental in preserving capital while providing superior relative performance. We expect to maintain the portfolio's relatively high average quality of BB and to favor larger issues with multiple underwriters. We intend to be overweight in areas we believe to have improving fundamentals as well as in areas with strong cash flows. We will stay underweight in issues from cyclical sectors as they are more sensitive to a slowing economy. 16 PIMCO Funds Annual Report | 3.31.01 PIMCO High Yield Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (12/15/92) PIMCO High Yield Fund A Shares 5.44% 2.83% 6.86% -- 9.00% PIMCO High Yield Fund A Shares (adjusted) 0.70% 1.27% 5.88% -- 8.40% PIMCO High Yield Fund B Shares 4.66% 2.06% 6.07% -- 8.33% PIMCO High Yield Fund B Shares (adjusted) -0.17% 1.24% 5.78% -- 8.33% PIMCO High Yield Fund C Shares (adjusted) 3.69% 2.07% 6.08% -- 8.21% Lipper High Current Yield Fund Average -3.20% -2.07% 3.77% -- -- Lehman Bros. Int. BB-rated Corp. Index 11.08% 4.95% 7.40% -- --
MATURITY PROFILE Less than 1 year 12% 1-5 years 32% 5-10 years 49% 10-20 years 6% 20-30 years 1% Duration 3.7 years SECTOR BREAKDOWN Corporate Bonds & Notes 76.2% Asset-Backed Securities 10.5% Short-Term Instruments 6.2% Other 7.1% QUALITY BREAKDOWN AAA 5.6% AA 1.1% A 2.1% BBB 14.4% BB 44.0% B 32.8% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] HIGH YIELD FUND Lehman Bros. PIMCO High PIMCO High PIMCO High Int. BB-rated MONTH Yield A Yield B Yield C Corp. Index -------------------------------------------------------------------------------- 12/31/1992 9,550 10,000 10,000 10,000 01/31/1993 9,764 10,218 10,218 10,211 02/28/1993 9,941 10,398 10,398 10,361 03/31/1993 10,138 10,597 10,597 10,478 04/30/1993 10,243 10,700 10,700 10,566 05/31/1993 10,315 10,769 10,769 10,644 06/30/1993 10,592 11,052 11,052 10,870 07/31/1993 10,664 11,120 11,120 10,980 08/31/1993 10,780 11,235 11,235 11,107 09/30/1993 10,831 11,281 11,281 11,188 10/31/1993 11,118 11,573 11,573 11,338 11/30/1993 11,200 11,652 11,652 11,368 12/31/1993 11,293 11,742 11,742 11,465 01/31/1994 11,530 11,981 11,981 11,657 02/28/1994 11,525 11,969 11,969 11,644 03/31/1994 11,177 11,601 11,601 11,288 04/30/1994 11,076 11,489 11,489 11,221 05/31/1994 11,154 11,562 11,562 11,231 06/30/1994 11,166 11,567 11,567 11,265 07/31/1994 11,267 11,666 11,666 11,402 08/31/1994 11,359 11,753 11,753 11,523 09/30/1994 11,434 11,824 11,824 11,544 10/31/1994 11,436 11,819 11,819 11,571 11/30/1994 11,387 11,761 11,761 11,492 12/31/1994 11,520 11,892 11,892 11,563 01/31/1995 11,629 11,997 11,997 11,749 02/28/1995 11,945 12,315 12,315 12,106 03/31/1995 12,115 12,484 12,484 12,220 04/30/1995 12,376 12,746 12,746 12,465 05/31/1995 12,731 13,104 13,104 12,831 06/30/1995 12,832 13,200 13,200 12,944 07/31/1995 13,000 13,365 13,365 13,062 08/31/1995 13,096 13,456 13,456 13,138 09/30/1995 13,275 13,634 13,634 13,280 10/31/1995 13,465 13,822 13,822 13,384 11/30/1995 13,625 13,978 13,978 13,553 12/31/1995 13,852 14,202 14,202 13,767 01/31/1996 14,072 14,419 14,419 13,990 02/29/1996 14,083 14,422 14,422 13,940 03/31/1996 13,968 14,295 14,295 13,867 04/30/1996 14,025 14,345 14,345 13,862 05/31/1996 14,068 14,381 14,381 13,881 06/30/1996 14,122 14,427 14,427 14,031 07/31/1996 14,243 14,542 14,542 14,107 08/31/1996 14,471 14,766 14,766 14,221 09/30/1996 14,804 15,097 15,097 14,527 10/31/1996 14,948 15,236 15,236 14,729 11/30/1996 15,267 15,554 15,554 15,026 12/31/1996 15,416 15,696 15,696 15,059 01/31/1997 15,570 15,837 15,842 15,203 02/28/1997 15,805 16,067 16,071 15,386 03/31/1997 15,593 15,842 15,846 15,203 04/30/1997 15,755 15,997 16,002 15,392 05/31/1997 16,110 16,346 16,351 15,655 06/30/1997 16,343 16,573 16,578 15,857 07/31/1997 16,760 16,984 16,989 16,330 08/31/1997 16,750 16,962 16,967 16,174 09/30/1997 17,026 17,232 17,237 16,428 10/31/1997 17,038 17,232 17,237 16,484 11/30/1997 17,197 17,381 17,387 16,600 12/31/1997 17,386 17,562 17,567 16,752 01/31/1998 17,680 17,847 17,852 16,953 02/28/1998 17,770 17,927 17,932 17,031 03/31/1998 17,903 18,051 18,056 17,140 04/30/1998 17,943 18,080 18,085 17,228 05/31/1998 18,029 18,156 18,161 17,340 06/30/1998 18,157 18,272 18,279 17,446 07/31/1998 18,344 18,447 18,454 17,536 08/31/1998 17,603 17,691 17,698 17,052 09/30/1998 17,821 17,898 17,905 17,414 10/31/1998 17,639 17,705 17,712 17,191 11/30/1998 18,378 18,436 18,443 17,603 12/31/1998 18,452 18,497 18,504 17,714 01/31/1999 18,690 18,724 18,731 17,897 02/28/1999 18,531 18,554 18,561 17,764 03/31/1999 18,679 18,689 18,697 17,892 04/30/1999 18,985 18,984 18,992 18,075 05/31/1999 18,617 18,605 18,612 17,856 06/30/1999 18,608 18,584 18,592 17,815 07/31/1999 18,652 18,618 18,625 17,883 08/31/1999 18,574 18,528 18,536 17,770 09/30/1999 18,580 18,523 18,530 17,843 10/31/1999 18,552 18,484 18,491 17,782 11/30/1999 18,802 18,722 18,730 17,933 12/31/1999 18,894 18,803 18,810 18,104 01/31/2000 18,804 18,713 18,709 17,975 02/29/2000 18,843 18,752 18,739 18,009 03/31/2000 18,463 18,373 18,347 17,838 04/30/2000 18,498 18,408 18,371 17,899 05/31/2000 18,400 18,310 18,262 17,906 06/30/2000 18,746 18,655 18,595 18,293 07/31/2000 18,888 18,796 18,725 18,597 08/31/2000 19,154 19,061 18,978 18,883 09/30/2000 19,091 18,999 18,902 18,790 10/31/2000 18,696 18,605 18,499 18,507 11/30/2000 18,337 18,248 18,133 18,410 12/31/2000 18,733 18,642 18,514 18,779 01/31/2001 19,499 19,405 19,260 19,470 02/28/2001 19,700 19,605 19,447 19,748 03/31/2001 19,464 19,369 19,200 19,815 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The Fund focuses on upper-tier credits of the high yield market because historically they have delivered the best risk-return profile. Importantly, income, capital appreciation and capital preservation are all considered in structuring the portfolio. * Past performance is no guarantee of future results. This Fund may invest at least 65% of its assets in high yield securities rated below investment grade but rated at least B by Moody's or S&P. This Fund may also invest in foreign securities, which may entail greater risk due to foreign economic and political developments, and may at times invest in derivatives and mortgage- related securities. An investment in high yield securities, lower rated securities generally involves greater risk to principal than an investment in higher-rated bonds. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 17 A LONG DURATION BOND FUND PIMCO Long-Term U.S. Government Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management. PORTFOLIO: Primarily longer-term U.S. Government securities. DURATION RANGE: Greater than or equal to 8 years FUND INCEPTION DATE: 7/01/91 TOTAL NET ASSETS: $481.0 million PORTFOLIO MANAGER: Jim Keller [PHOTO] Jim Keller Portfolio Manager Mr. Keller is the Treasury/futures specialist at PIMCO. He currently serves on the U.S. Treasury Borrowing Advisory Committee and has 14 years of investment experience. Fund Highlights . 15.07% return substantially outpaced Lipper Average. . Treasury yields rallied as the Fed eased and the economy slowed. . Above-benchmark duration contributed to outperformance. . Foresee continued economic weakness, which bodes well for high-quality bonds. Beating its benchmark PIMCO Long-Term U.S. Government Fund delivered strong results for its shareholders, with Class A shares returning 15.07% for the one-year period ended March 31, 2001. This performance significantly bettered both the Fund's benchmark, the Lehman Long-Term U.S. Treasury Index, which returned 12.83%, and the Lipper General U.S. Government Fund Average, which returned 11.41%. Bond market shows strength PIMCO Long-Term U.S. Government Fund's total return for the year was supported by one of the stronger bond markets in recent memory. With the economy slowing sharply, default rates and downgrades rising in the corporate sector and investors anticipating further aggressive Federal Reserve easing, Treasury securities became the bond investment of choice. As a result, yields fell, prices rose, and higher quality bonds outperformed lower quality issues. Longer duration pays off The Fund's emphasis throughout the year on an above-benchmark duration boosted returns, as Treasury yields fell substantially across all maturity dates. In addition, the Fund's holdings in higher quality areas of the bond market like mortgages helped performance for most of the year as their relatively high yields and solid credit quality offset increased market volatility. Real return bonds also boosted returns as real yields outperformed the nominal yields on similar issues. The Fund's underweight in intermediate term securities detracted slightly from performance as these yields fell further than their longer-term counterparts. The Fund's modest exposure to corporate securities also hurt performance due to widening yield premiums as concerns about a slowing economy drove investors to higher quality areas of the bond market. Economic weakness to continue We believe that the U.S. economy will continue to struggle over the next two or three quarters, leading a worldwide slowdown. Banks throughout the world, including our own Federal Reserve, will cut interest rates in order to mitigate this slowdown. As a result, bonds should continue to perform well. In the months ahead, we intend to target the Fund's duration above the benchmark as the weak economy and the prospects for further Fed easing put a ceiling on rates. We expect to remain underweight in intermediate-term issues in favor of more attractively priced longer maturity bonds. We further hope to maintain our high quality stance in the face of continued economic weakness and credit erosion, emphasizing mortgages and real return bonds. 18 PIMCO Funds Annual Report | 3.31.01 PIMCO Long-Term U.S. Gov't. Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (7/1/91) PIMCO Long-Term U.S. Gov't. Fund A Shares 15.07% 7.60% 9.20% -- 10.87% PIMCO Long-Term U.S. Gov't. Fund A Shares (adjusted) 9.89% 5.96% 8.20% -- 10.35% PIMCO Long-Term U.S. Gov't. Fund B Shares 14.22% 6.79% 8.36% -- 10.28% PIMCO Long-Term U.S. Gov't. Fund B Shares (adjusted) 9.22% 5.91% 8.07% -- 10.28% PIMCO Long-Term U.S. Gov't. Fund C Shares (adjusted) 13.24% 6.80% 8.39% -- 10.07% Lipper General U.S. Gov't. Fund Avg. 11.41% 5.84% 6.48% -- -- Lehman Long-Term Treasury Index 12.83% 7.56% 9.09% -- --
MATURITY PROFILE 1-5 years 6% 5-10 years 14% 10-20 years 37% 20-30 years 43% Duration 11.0 years SECTOR BREAKDOWN U.S. Treasury Obligations 41.5% Mortgage-Backed Securities 39.0% U.S. Government Agencies 8.8% Other 10.7% QUALITY BREAKDOWN AAA 95.0% AA 2.3% A 2.7% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] LONG-TERM U.S. GOVERNMENT FUND
PIMCO Lehman Int. PIMCO Long-Term PIMCO Long-Term Long-Term U.S. Lehman Long-Term & 20+ yr. Lehman Bros. MONTH U.S. Gov't. A U.S. Gov't. B Gov't. C Treas. Index Treas. Index Agg. Bond Index ------------------------------------------------------------------------------------------------------------------------------- 06/30/1991 9,550 10,000 10,000 10,000 10,000 10,000 07/31/1991 9,678 10,128 10,128 10,149 10,157 10,139 08/31/1991 10,051 10,511 10,511 10,499 10,508 10,358 09/30/1991 10,385 10,855 10,855 10,830 10,831 10,568 10/31/1991 10,435 10,900 10,900 10,854 10,848 10,686 11/30/1991 10,572 11,037 11,037 10,914 10,900 10,784 12/31/1991 11,265 11,755 11,755 11,565 11,550 11,104 01/31/1992 10,944 11,413 11,413 11,202 11,191 10,953 02/29/1992 10,997 11,462 11,462 11,268 11,250 11,024 03/31/1992 10,958 11,416 11,416 11,144 11,126 10,962 04/30/1992 10,901 11,350 11,350 11,133 11,102 11,041 05/31/1992 11,287 11,745 11,745 11,442 11,414 11,249 06/30/1992 11,447 11,906 11,906 11,608 11,564 11,404 07/31/1992 11,986 12,458 12,458 12,091 12,046 11,637 08/31/1992 12,223 12,697 12,697 12,175 12,123 11,755 09/30/1992 12,436 12,911 12,911 12,367 12,300 11,894 10/31/1992 12,123 12,579 12,579 12,107 12,046 11,736 11/30/1992 12,247 12,701 12,701 12,153 12,112 11,739 12/31/1992 12,567 13,025 13,025 12,486 12,443 11,926 01/31/1993 12,898 13,361 13,361 12,842 12,777 12,154 02/28/1993 13,413 13,886 13,886 13,271 13,187 12,367 03/31/1993 13,482 13,948 13,948 13,304 13,217 12,419 04/30/1993 13,583 14,046 14,046 13,407 13,315 12,505 05/31/1993 13,632 14,088 14,088 13,451 13,371 12,521 06/30/1993 14,304 14,776 14,776 14,020 13,901 12,748 07/31/1993 14,508 14,978 14,978 14,246 14,133 12,820 08/31/1993 15,058 15,538 15,538 14,818 14,663 13,045 09/30/1993 15,103 15,577 15,577 14,870 14,703 13,081 10/31/1993 15,177 15,644 15,644 14,977 14,809 13,130 11/30/1993 14,761 15,208 15,208 14,594 14,468 13,018 12/31/1993 14,856 15,296 15,296 14,640 14,505 13,088 01/31/1994 15,191 15,632 15,632 14,992 14,828 13,265 02/28/1994 14,593 15,009 15,009 14,377 14,253 13,035 03/31/1994 13,995 14,383 14,383 13,746 13,651 12,713 04/30/1994 13,751 14,124 14,124 13,584 13,488 12,612 05/31/1994 13,703 14,066 14,066 13,494 13,388 12,610 06/30/1994 13,619 13,972 13,972 13,366 13,259 12,582 07/31/1994 13,953 14,304 14,304 13,819 13,722 12,832 08/31/1994 13,980 14,321 14,321 13,717 13,605 12,848 09/30/1994 13,539 13,860 13,860 13,285 13,161 12,659 10/31/1994 13,446 13,755 13,755 13,238 13,119 12,648 11/30/1994 13,400 13,700 13,700 13,316 13,203 12,620 12/31/1994 13,702 13,999 13,999 13,521 13,411 12,707 01/31/1995 14,055 14,350 14,350 13,869 13,767 12,958 02/28/1995 14,537 14,833 14,833 14,263 14,141 13,266 03/31/1995 14,701 14,992 14,992 14,385 14,269 13,348 04/30/1995 14,948 15,235 15,235 14,641 14,517 13,534 05/31/1995 16,089 16,387 16,387 15,764 15,584 14,058 06/30/1995 16,268 16,561 16,561 15,947 15,759 14,161 07/31/1995 15,981 16,259 16,259 15,692 15,518 14,129 08/31/1995 16,338 16,612 16,612 16,041 15,849 14,300 09/30/1995 16,686 16,956 16,956 16,336 16,128 14,439 10/31/1995 17,091 17,359 17,359 16,793 16,558 14,627 11/30/1995 17,506 17,771 17,771 17,213 16,942 14,846 12/31/1995 17,960 18,220 18,220 17,671 17,364 15,054 01/31/1996 17,983 18,233 18,233 17,671 17,376 15,154 02/29/1996 17,140 17,369 17,369 16,817 16,586 14,891 03/31/1996 16,819 17,034 17,034 16,483 16,271 14,787 04/30/1996 16,441 16,640 16,640 16,207 16,014 14,704 05/31/1996 16,457 16,645 16,645 16,123 15,939 14,674 06/30/1996 16,783 16,963 16,963 16,467 16,268 14,871 07/31/1996 16,723 16,892 16,892 16,473 16,274 14,912 08/31/1996 16,601 16,758 16,758 16,267 16,072 14,887 09/30/1996 17,057 17,208 17,208 16,716 16,505 15,146 10/31/1996 17,784 17,929 17,929 17,373 17,133 15,482 11/30/1996 18,447 18,587 18,587 17,953 17,667 15,747 12/31/1996 18,017 18,142 18,142 17,517 17,263 15,601 01/31/1997 17,924 18,026 18,043 17,393 17,139 15,648 02/28/1997 17,959 18,050 18,068 17,400 17,146 15,687 03/31/1997 17,507 17,586 17,602 16,954 16,721 15,514 04/30/1997 17,897 17,966 17,980 17,363 17,115 15,746 05/31/1997 18,103 18,161 18,176 17,557 17,304 15,895 06/30/1997 18,454 18,503 18,518 17,896 17,633 16,083 07/31/1997 19,473 19,513 19,527 18,947 18,618 16,517 08/31/1997 18,976 19,002 19,017 18,420 18,136 16,376 09/30/1997 19,466 19,481 19,497 18,927 18,608 16,618 10/31/1997 20,122 20,124 20,140 19,564 19,198 16,859 11/30/1997 20,307 20,295 20,313 19,825 19,443 16,936 12/31/1997 20,648 20,621 20,640 20,158 19,747 17,107 01/31/1998 21,026 20,984 21,003 20,567 20,129 17,326 02/28/1998 20,877 20,823 20,842 20,419 19,999 17,313 03/31/1998 20,971 20,904 20,923 20,462 20,043 17,373 04/30/1998 21,084 21,004 21,023 20,537 20,117 17,464 05/31/1998 21,487 21,393 21,412 20,930 20,475 17,629 06/30/1998 21,983 21,874 21,892 21,415 20,919 17,779 07/31/1998 21,961 21,852 21,855 21,325 20,845 17,817 08/31/1998 22,881 22,768 22,757 22,287 21,704 18,107 09/30/1998 23,801 23,683 23,643 23,103 22,427 18,531 10/31/1998 23,149 23,034 22,981 22,754 22,155 18,433 11/30/1998 23,230 23,115 23,043 22,929 22,281 18,537 12/31/1998 23,337 23,221 23,133 22,881 22,265 18,593 01/31/1999 23,507 23,391 23,290 23,087 22,448 18,726 02/28/1999 22,435 22,324 22,214 21,951 21,442 18,399 03/31/1999 22,521 22,409 22,285 21,900 21,406 18,501 04/30/1999 22,548 22,436 22,296 21,931 21,433 18,559 05/31/1999 22,135 22,025 21,875 21,587 21,136 18,397 06/30/1999 21,922 21,814 21,652 21,358 20,940 18,338 07/31/1999 21,789 21,681 21,504 21,255 20,847 18,260 08/31/1999 21,612 21,505 21,317 21,173 20,779 18,251 09/30/1999 21,828 21,720 21,518 21,329 20,931 18,463 10/31/1999 21,868 21,759 21,544 21,342 20,938 18,531 11/30/1999 21,721 21,614 21,386 21,197 20,812 18,529 12/31/1999 21,389 21,283 21,044 20,881 20,496 18,440 01/31/2000 21,479 21,372 21,122 21,180 20,785 18,380 02/29/2000 22,121 22,011 21,741 21,819 21,405 18,602 03/31/2000 22,712 22,599 22,306 22,566 22,091 18,847 04/30/2000 22,578 22,466 22,161 22,385 21,912 18,793 05/31/2000 22,449 22,338 22,021 22,304 21,844 18,784 06/30/2000 23,129 23,014 22,675 22,788 22,284 19,175 07/31/2000 23,538 23,422 23,063 23,180 22,663 19,349 08/31/2000 24,059 23,939 23,559 23,709 23,136 19,630 09/30/2000 23,772 23,655 23,265 23,422 22,768 19,753 10/31/2000 24,184 24,064 23,653 23,787 23,094 19,884 11/30/2000 24,977 24,853 24,412 24,539 23,759 20,209 12/31/2000 25,641 25,514 25,045 25,116 24,271 20,584 01/31/2001 25,782 25,654 25,165 25,158 24,344 20,921 02/28/2001 26,282 26,152 25,638 25,589 24,713 21,103 03/31/2001 26,133 26,003 25,479 25,461 24,626 21,209
Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. Rather than react to short-term events with extreme duration shifts, the Fund operates within a moderate duration range in accordance with the firm's long-term outlook. PIMCO's interest rate volatility forecast is key and guides sector and security decisions. * Past performance is no guarantee of future results. The Fund may invest at least 65% of its assets in securities that are issued or guaranteed by the U.S. Government or agencies. The Fund is not guaranteed by the U.S. Government, the guarantee is to timely repayment of principal and interest of the securities held by the Fund. The Fund's net asset value and yield are not guaranteed by the U.S. Government nor its agencies. Guarantee does not eliminate market risk. The Fund may at times invest in derivatives and mortgage related securities. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 19 A SHORT DURATION BOND FUND PIMCO Low Duration Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management. PORTFOLIO: Primarily shorter-term, investment grade bonds. DURATION RANGE: 1-3 years FUND INCEPTION DATE: 5/11/87 TOTAL NET ASSETS: $4.6 billion PORTFOLIO MANAGER: Bill Gross [PHOTO] Bill Gross Portfolio Manager Managing Director and co-founder of PIMCO, Mr. Gross is widely regarded as the world's foremost fixed income authority. He has over 30 years of investment experience. Recently, Mr. Gross and the PIMCO bond team were named Morningstar's 2000 Fixed Income Manager of the Year--making them the only two-time winner of the prestigious award. Fund Highlights . 8.93% return kept pace with Lipper Average. . Fund's performance was supported by a strong U.S. bond market. . Above-Index duration boosted returns. . Continued economic weakness should bode well for higher-quality bonds. Solid results highlight year I am pleased to report an 8.93% total return for PIMCO Low Duration Fund's Class A shares for the year ending March 31, 2001. This result underper-formed the Fund's benchmark Merrill Lynch 1-3 Year Treasury Index return of 9.60% but virtually mirrored its Lipper Average, which returned 8.97%. Bond market shows strength PIMCO Low Duration Fund's total return for the year was supported by one of the stronger bond markets in recent years. With the economy slowing sharply, default rates and downgrades rising in the corporate sector and investors anticipating further aggressive Federal Reserve easing, Treasury yields fell and higher quality bonds outperformed lower quality issues. Longer duration pays off PIMCO Low Duration Fund's emphasis throughout the year on longer-than-benchmark duration boosted returns, as yields on short- to intermediate-maturity fell substantially. In addition, our broader-than-index maturity distribution enhanced performance as these yields fell the most. The Fund's allocation to mortgage-backed securities also helped returns as higher yields offset the incremental risk associated with this sector. The Fund's position in investment-grade corporate debt slightly hurt performance as concerns about a slowing economy drove investors to higher quality areas of the bond market. Below-investment-grade holdings also hurt performance, as corporate profitability eroded and default rates increased. Economic weakness to continue We believe that growth will weaken globally, led by the U.S., which will continue to struggle over the next two or three quarters. We expect bonds to perform relatively well in this environment, although risk of further credit erosion is a very real concern. We therefore intend to target the Fund's duration above the benchmark and continue to focus on high quality areas of the bond market like mortgage-backed securities, which offer strong credit quality and attractive yields. In addition, we anticipate maintaining a broad maturity structure to take advantage of value across the entire yield curve, especially in mortgages and high-quality corporates. 20 PIMCO Funds Annual Report | 3.31.01 PIMCO Low Duration Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (5/11/87) PIMCO Low Duration Fund A Shares 8.93% 5.93% 6.55% 6.85% 7.38% PIMCO Low Duration Fund A Shares (adjusted) 5.67% 4.86% 5.90% 6.53% 7.15% PIMCO Low Duration Fund B Shares 8.12% 5.13% 5.75% 6.30% 6.98% PIMCO Low Duration Fund B Shares (adjusted) 3.12% 4.24% 5.43% 6.30% 6.98% PIMCO Low Duration Fund C Shares (adjusted) 7.39% 5.40% 6.03% 6.33% 6.86% Lipper Shrt. Inv. Grade Debt Fund Average 8.97% 5.81% 5.94% 6.29% -- Merrill Lynch 1-3 yr. Treasury Index 9.60% 6.44% 6.43% 6.48% --
MATURITY PROFILE 1-5 years 93% 5-10 years 6% Over 30 years 1% Duration 2.2 years SECTOR BREAKDOWN Mortgage-Backed Securities 59.6% Corporate Bonds & Notes 25.7% Other 14.7% QUALITY BREAKDOWN AAA 69.4% AA 4.5% A 14.8% BBB 9.7% BB 1.6% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] LOW DURATION FUND PIMCO Low PIMCO Low PIMCO Low Merrill Lynch 1-3 MONTH Duration A Duration B Duration C yr. Treas. Index ------------------------------------------------------------------------------- 05/31/1987 9,700 10,000 10,000 10,000 06/30/1987 9,786 10,083 10,085 10,109 07/31/1987 9,819 10,109 10,114 10,158 08/31/1987 9,813 10,097 10,104 10,167 09/30/1987 9,785 10,063 10,072 10,127 10/31/1987 9,940 10,215 10,227 10,351 11/30/1987 10,048 10,320 10,334 10,414 12/31/1987 10,103 10,370 10,387 10,480 01/31/1988 10,266 10,531 10,550 10,648 02/29/1988 10,337 10,598 10,619 10,735 03/31/1988 10,398 10,653 10,677 10,756 04/30/1988 10,437 10,687 10,713 10,772 05/31/1988 10,457 10,700 10,728 10,756 06/30/1988 10,551 10,788 10,821 10,868 07/31/1988 10,603 10,835 10,869 10,876 08/31/1988 10,641 10,867 10,904 10,899 09/30/1988 10,735 10,956 10,996 11,026 10/31/1988 10,830 11,046 11,088 11,136 11/30/1988 10,840 11,050 11,094 11,106 12/31/1988 10,884 11,087 11,134 11,132 01/31/1989 10,970 11,168 11,217 11,219 02/28/1989 10,983 11,175 11,226 11,219 03/31/1989 11,021 11,206 11,260 11,270 04/30/1989 11,147 11,327 11,384 11,443 05/31/1989 11,372 11,548 11,608 11,614 06/30/1989 11,615 11,788 11,852 11,831 07/31/1989 11,781 11,948 12,015 12,006 08/31/1989 11,723 11,882 11,950 11,932 09/30/1989 11,778 11,929 12,000 12,003 10/31/1989 11,928 12,075 12,149 12,184 11/30/1989 12,032 12,172 12,250 12,299 12/31/1989 12,089 12,222 12,303 12,348 01/31/1990 12,077 12,202 12,284 12,358 02/28/1990 12,155 12,274 12,359 12,416 03/31/1990 12,216 12,328 12,416 12,457 04/30/1990 12,204 12,308 12,399 12,482 05/31/1990 12,405 12,502 12,597 12,673 06/30/1990 12,534 12,625 12,723 12,806 07/31/1990 12,667 12,750 12,853 12,966 08/31/1990 12,687 12,761 12,867 13,005 09/30/1990 12,752 12,819 12,927 13,111 10/31/1990 12,840 12,898 13,010 13,255 11/30/1990 12,988 13,039 13,155 13,386 12/31/1990 13,123 13,167 13,286 13,548 01/31/1991 13,238 13,275 13,398 13,672 02/28/1991 13,339 13,367 13,494 13,754 03/31/1991 13,447 13,468 13,598 13,846 04/30/1991 13,605 13,619 13,753 13,977 05/31/1991 13,706 13,711 13,849 14,062 06/30/1991 13,788 13,785 13,927 14,119 07/31/1991 13,936 13,924 14,070 14,242 08/31/1991 14,130 14,110 14,260 14,437 09/30/1991 14,309 14,280 14,436 14,593 10/31/1991 14,428 14,390 14,550 14,750 11/30/1991 14,578 14,531 14,695 14,903 12/31/1991 14,817 14,761 14,930 15,131 01/31/1992 14,824 14,759 14,932 15,107 02/29/1992 14,893 14,818 14,995 15,160 03/31/1992 14,895 14,813 14,992 15,154 04/30/1992 14,995 14,903 15,086 15,293 05/31/1992 15,142 15,040 15,228 15,432 06/30/1992 15,279 15,166 15,359 15,590 07/31/1992 15,476 15,353 15,551 15,765 08/31/1992 15,573 15,440 15,643 15,903 09/30/1992 15,723 15,579 15,786 16,055 10/31/1992 15,723 15,568 15,780 15,959 11/30/1992 15,726 15,562 15,777 15,933 12/31/1992 15,885 15,710 15,930 16,084 01/31/1993 16,029 15,842 16,067 16,251 02/28/1993 16,213 16,015 16,245 16,390 03/31/1993 16,299 16,090 16,325 16,439 04/30/1993 16,371 16,151 16,390 16,541 05/31/1993 16,384 16,154 16,397 16,495 06/30/1993 16,541 16,300 16,548 16,616 07/31/1993 16,593 16,339 16,591 16,655 08/31/1993 16,749 16,483 16,740 16,800 09/30/1993 16,807 16,530 16,792 16,855 10/31/1993 16,917 16,628 16,894 16,888 11/30/1993 16,927 16,628 16,898 16,892 12/31/1993 17,040 16,728 17,002 16,954 01/31/1994 17,127 16,801 17,081 17,063 02/28/1994 17,047 16,714 16,995 16,954 03/31/1994 16,966 16,624 16,907 16,870 04/30/1994 16,904 16,552 16,838 16,810 05/31/1994 16,878 16,517 16,806 16,834 06/30/1994 16,907 16,546 16,827 16,884 07/31/1994 17,057 16,693 16,970 17,029 08/31/1994 17,124 16,758 17,028 17,089 09/30/1994 17,091 16,726 16,989 17,050 10/31/1994 17,083 16,718 16,974 17,088 11/30/1994 17,080 16,714 16,964 17,012 12/31/1994 17,064 16,699 16,942 17,050 01/31/1995 17,216 16,848 17,086 17,288 02/28/1995 17,426 17,053 17,287 17,525 03/31/1995 17,491 17,117 17,344 17,623 04/30/1995 17,704 17,325 17,547 17,780 05/31/1995 18,019 17,634 17,852 18,091 06/30/1995 18,106 17,718 17,931 18,188 07/31/1995 18,106 17,718 17,924 18,263 08/31/1995 18,296 17,904 18,105 18,372 09/30/1995 18,453 18,058 18,253 18,461 10/31/1995 18,584 18,187 18,376 18,617 11/30/1995 18,794 18,392 18,576 18,782 12/31/1995 19,010 18,604 18,782 18,926 01/31/1996 19,143 18,734 18,906 19,087 02/29/1996 19,013 18,607 18,770 19,006 03/31/1996 18,998 18,592 18,747 18,989 04/30/1996 18,998 18,592 18,740 19,005 05/31/1996 19,009 18,603 18,744 19,044 06/30/1996 19,196 18,785 18,920 19,181 07/31/1996 19,253 18,841 18,969 19,256 08/31/1996 19,342 18,928 19,047 19,323 09/30/1996 19,609 19,189 19,302 19,498 10/31/1996 19,883 19,458 19,565 19,717 11/30/1996 20,144 19,713 19,813 19,868 12/31/1996 20,081 19,652 19,744 19,868 01/31/1997 20,242 19,809 19,896 19,962 02/28/1997 20,317 19,882 19,961 20,007 03/31/1997 20,227 19,795 19,866 20,000 04/30/1997 20,466 20,028 20,092 20,163 05/31/1997 20,630 20,189 20,245 20,301 06/30/1997 20,784 20,340 20,388 20,440 07/31/1997 21,113 20,661 20,700 20,665 08/31/1997 21,094 20,643 20,671 20,684 09/30/1997 21,271 20,816 20,837 20,841 10/31/1997 21,420 20,962 20,976 20,996 11/30/1997 21,476 21,016 21,029 21,047 12/31/1997 21,632 21,170 21,176 21,191 01/31/1998 21,790 21,324 21,320 21,396 02/28/1998 21,858 21,390 21,378 21,415 03/31/1998 21,943 21,474 21,452 21,502 04/30/1998 22,055 21,583 21,553 21,603 05/31/1998 22,187 21,713 21,674 21,718 06/30/1998 22,234 21,759 21,709 21,831 07/31/1998 22,332 21,854 21,793 21,933 08/31/1998 22,412 21,933 21,863 22,209 09/30/1998 22,860 22,372 22,291 22,503 10/31/1998 22,817 22,329 22,240 22,613 11/30/1998 22,942 22,452 22,354 22,594 12/31/1998 23,075 22,582 22,472 22,673 01/31/1999 23,170 22,675 22,555 22,763 02/28/1999 23,040 22,548 22,420 22,652 03/31/1999 23,229 22,733 22,595 22,810 04/30/1999 23,343 22,844 22,694 22,883 05/31/1999 23,261 22,764 22,606 22,868 06/30/1999 23,266 22,769 22,599 22,940 07/31/1999 23,259 22,762 22,583 23,012 08/31/1999 23,266 22,769 22,581 23,079 09/30/1999 23,431 22,930 22,732 23,229 10/31/1999 23,520 23,017 22,809 23,291 11/30/1999 23,612 23,107 22,889 23,335 12/31/1999 23,647 23,142 22,914 23,368 01/31/2000 23,610 23,105 22,871 23,359 02/29/2000 23,772 23,264 23,020 23,515 03/31/2000 23,939 23,427 23,169 23,661 04/30/2000 23,984 23,472 23,204 23,722 05/31/2000 24,049 23,535 23,257 23,820 06/30/2000 24,331 23,810 23,520 24,067 07/31/2000 24,469 23,946 23,645 24,219 08/31/2000 24,733 24,205 23,891 24,398 09/30/2000 24,850 24,318 23,993 24,573 10/31/2000 24,842 24,311 23,977 24,705 11/30/2000 25,029 24,493 24,147 24,939 12/31/2000 25,351 24,809 24,449 25,236 01/31/2001 25,755 25,204 24,828 25,552 02/28/2001 25,873 25,320 24,934 25,718 03/31/2001 26,077 25,520 25,121 25,933 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The manager then employs a number of value-adding strategies, including duration management, sector allocation and liquidity management. Investment in a wide range of short-term instruments further enhances total return potential. * Past performance is no guarantee of future results. The fund may invest up to 20% in foreign securities, which may entail greater risk due to foreign economic and political developments. The Fund may invest up to 10% in high yield securities, lower rated securities generally involves greater risk to principal than investment in higher rated securities, may at times invest in derivatives and mortgage related securities. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 21 A SHORT DURATION BOND FUND PIMCO Money Market Fund OBJECTIVE: Maximum current income, consistent with preservation of capital and daily liquidity. PORTFOLIO: Primarily money market instruments. DURATION RANGE: Less than or equal to 90 days dollar-weighted average maturity. FUND INCEPTION DATE: 3/01/91 TOTAL NET ASSETS: $348.9 million PORTFOLIO MANAGER: Paul McCulley [PHOTO] Paul McCulley Portfolio Manager Mr. McCulley is Managing Director, responsible for supervising short-term investment strategies at PIMCO. He has 19 years of investment experience. Fund Highlights . Fund has beaten Lipper Average over the 1-, 3- 5-year and since inception periods. . Sector strategies were positive for performance, as was a slowing U.S. economy. . Anticipate continued economic weakness, which bodes well for higher-quality issues. Long-term performance remains strong PIMCO Money Market Fund posted solid results for the 12-month period ended March, 31, 2001. Our Class A shares returned 5.94%, slightly trailing the benchmark, but once again surpassing the Lipper Money Market Fund Average. As of the end of this fiscal year, the Fund has beaten its Lipper Index over the 1-, 3-, 5-year and since-inception periods. Slowing economy drives down yields Slower U.S. growth, combined with three rate cuts by the Federal Reserve, drove Treasury yields down and bond prices up over the past year. High quality commercial paper yields also fell modestly, particularly during the second half of the period. Sector strategies bring results Our performance during the year was aided by holdings in high quality commercial paper and short-maturity corporates. These securities paid an attractive yield premium compared to similar maturity Treasuries. In fact, over the year the yield difference between three-month commercial paper yields and relative Treasuries grew by 0.18%, reaching 0.58% on March 31, 2001. Unfortunately, Fed easing at the end of the fiscal year drove down commercial paper yields. We were therefore forced to reinvest assets at lower rates, which reduced our return potential. Stay focused on commercial paper Looking ahead, we expect the U.S. economy to continue struggling. The Federal Reserve will probably ease again to mitigate this slowdown, with the nominal fed funds rate moving down to the 4% range. Commercial paper rates could continue to fall in this environment, but their premium over like-maturity Treasury issues may rise. We believe that higher quality issues will offer the best risk/reward tradeoffs in this market. Our core investments for the Fund going forward will therefore be high-quality domestic and Yankee commercial paper. We also intend to keep a modest allocation in short maturity corporate issues and floating rate notes to enhance portfolio yields. We believe these securities will pose minimal interest rate and credit risk. Overall, we plan to maintain an average portfolio maturity of one month to ensure sufficient liquidity. 22 PIMCO Funds Annual Report | 3.31.01 PIMCO Money Market Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (3/1/91) PIMCO Money Market Fund A Shares 5.94% 5.21% 5.13% 4.61% 4.62% PIMCO Money Market Fund B Shares 5.02% 4.34% 4.25% 3.70% 3.71% PIMCO Money Market Fund C Shares 5.94% 5.25% 5.16% 4.63% 4.64% Lipper Money Market Fund Avg. 5.68% 5.04% 5.01% 4.58% -- Salomon Brothers 3-Mo. T-bill Index 6.02% 5.29% 5.27% 4.84% --
MATURITY PROFILE Less than 1 year 100% Duration 47 days SECTOR BREAKDOWN Short-Term Instruments 66.4% Corporate Bonds & Notes 31.9% Other 1.7% QUALITY BREAKDOWN AAA 58.7% AA 40.7% A 0.6% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] MONEY MARKET FUND
Solomon Lipper Money PIMCO Money PIMCO Money PIMCO Money Bros. 3 Mo. Market Fund MONTH Market A Market B Market C T-Bill Index Avg. -------------------------------------------------------------------------------------------- 02/28/1991 10,000 10,000 10,000 10,000 10,000 03/31/1991 10,048 10,041 10,048 10,052 10,052 04/30/1991 10,096 10,081 10,096 10,100 10,102 05/31/1991 10,146 10,122 10,146 10,149 10,152 06/30/1991 10,189 10,158 10,189 10,195 10,196 07/31/1991 10,234 10,196 10,234 10,244 10,245 08/31/1991 10,280 10,233 10,280 10,293 10,293 09/30/1991 10,322 10,267 10,322 10,338 10,337 10/31/1991 10,363 10,299 10,363 10,383 10,382 11/30/1991 10,402 10,330 10,402 10,425 10,424 12/31/1991 10,451 10,370 10,451 10,463 10,467 01/31/1992 10,485 10,396 10,485 10,500 10,505 02/29/1992 10,515 10,418 10,515 10,533 10,538 03/31/1992 10,546 10,441 10,546 10,568 10,572 04/30/1992 10,577 10,463 10,577 10,602 10,604 05/31/1992 10,606 10,484 10,606 10,637 10,636 06/30/1992 10,635 10,503 10,635 10,669 10,667 07/31/1992 10,664 10,523 10,664 10,701 10,698 08/31/1992 10,688 10,539 10,688 10,731 10,726 09/30/1992 10,712 10,554 10,712 10,758 10,751 10/31/1992 10,735 10,570 10,735 10,785 10,777 11/30/1992 10,758 10,584 10,758 10,812 10,802 12/31/1992 10,785 10,602 10,785 10,841 10,829 01/31/1993 10,806 10,615 10,806 10,870 10,855 02/28/1993 10,827 10,629 10,827 10,895 10,878 03/31/1993 10,852 10,645 10,852 10,922 10,903 04/30/1993 10,874 10,659 10,874 10,949 10,927 05/31/1993 10,893 10,671 10,893 10,976 10,950 06/30/1993 10,917 10,687 10,917 11,003 10,974 07/31/1993 10,940 10,701 10,940 11,032 10,998 08/31/1993 10,964 10,717 10,964 11,061 11,023 09/30/1993 10,987 10,730 10,987 11,088 11,048 10/31/1993 11,011 10,746 11,011 11,117 11,072 11/30/1993 11,036 10,762 11,036 11,145 11,096 12/31/1993 11,059 10,776 11,059 11,174 11,122 01/31/1994 11,083 10,791 11,083 11,203 11,147 02/28/1994 11,104 10,805 11,104 11,230 11,171 03/31/1994 11,130 10,821 11,130 11,261 11,198 04/30/1994 11,155 10,838 11,155 11,295 11,226 05/31/1994 11,186 10,860 11,186 11,332 11,257 06/30/1994 11,219 10,884 11,219 11,371 11,290 07/31/1994 11,253 10,908 11,253 11,412 11,325 08/31/1994 11,293 10,938 11,293 11,454 11,363 09/30/1994 11,330 10,966 11,330 11,497 11,402 10/31/1994 11,372 10,997 11,372 11,544 11,444 11/30/1994 11,417 11,032 11,417 11,592 11,487 12/31/1994 11,466 11,070 11,466 11,645 11,537 01/31/1995 11,520 11,113 11,520 11,699 11,589 02/28/1995 11,568 11,152 11,568 11,750 11,637 03/31/1995 11,620 11,195 11,620 11,808 11,692 04/30/1995 11,669 11,234 11,669 11,865 11,745 05/31/1995 11,726 11,281 11,726 11,923 11,801 06/30/1995 11,779 11,324 11,779 11,979 11,855 07/31/1995 11,832 11,366 11,832 12,036 11,910 08/31/1995 11,884 11,408 11,884 12,093 11,964 09/30/1995 11,933 11,445 11,933 12,147 12,016 10/31/1995 11,986 11,489 11,986 12,203 12,070 11/30/1995 12,073 11,562 12,073 12,257 12,122 12/31/1995 12,131 11,609 12,131 12,313 12,175 01/31/1996 12,184 11,650 12,184 12,369 12,229 02/29/1996 12,234 11,690 12,234 12,419 12,277 03/31/1996 12,283 11,729 12,283 12,472 12,326 04/30/1996 12,333 11,769 12,333 12,523 12,375 05/31/1996 12,389 11,812 12,389 12,577 12,426 06/30/1996 12,433 11,846 12,433 12,629 12,474 07/31/1996 12,484 11,885 12,484 12,684 12,527 08/31/1996 12,540 11,931 12,540 12,740 12,579 09/30/1996 12,588 11,966 12,588 12,794 12,628 10/31/1996 12,638 12,006 12,638 12,851 12,680 11/30/1996 12,689 12,044 12,689 12,905 12,731 12/31/1996 12,738 12,083 12,738 12,960 12,784 01/31/1997 12,791 12,124 12,791 13,016 12,838 02/28/1997 12,837 12,160 12,838 13,067 12,886 03/31/1997 12,885 12,199 12,887 13,124 12,938 04/30/1997 12,938 12,241 12,940 13,181 12,991 05/31/1997 12,995 12,286 12,998 13,239 13,047 06/30/1997 13,046 12,327 13,050 13,294 13,102 07/31/1997 13,101 12,368 13,105 13,351 13,158 08/31/1997 13,160 12,414 13,162 13,409 13,215 09/30/1997 13,211 12,455 13,215 13,465 13,271 10/31/1997 13,270 12,500 13,274 13,524 13,328 11/30/1997 13,321 12,540 13,326 13,581 13,384 12/31/1997 13,381 12,586 13,386 13,639 13,442 01/31/1998 13,438 12,632 13,444 13,699 13,502 02/28/1998 13,489 12,671 13,496 13,754 13,554 03/31/1998 13,543 12,722 13,551 13,815 13,613 04/30/1998 13,599 12,774 13,607 13,873 13,668 05/31/1998 13,656 12,827 13,666 13,932 13,727 06/30/1998 13,712 12,880 13,722 13,990 13,783 07/31/1998 13,770 12,934 13,782 14,048 13,843 08/31/1998 13,825 12,986 13,837 14,109 13,902 09/30/1998 13,881 13,039 13,894 14,167 13,959 10/31/1998 13,934 13,089 13,952 14,223 14,015 11/30/1998 13,987 13,138 14,004 14,276 14,070 12/31/1998 14,046 13,194 14,064 14,329 14,125 01/31/1999 14,094 13,238 14,112 14,382 14,180 02/28/1999 14,139 13,281 14,158 14,431 14,228 03/31/1999 14,188 13,327 14,209 14,485 14,282 04/30/1999 14,242 13,378 14,263 14,539 14,333 05/31/1999 14,290 13,423 14,312 14,594 14,386 06/30/1999 14,341 13,470 14,362 14,648 14,438 07/31/1999 14,396 13,523 14,418 14,705 14,480 08/31/1999 14,450 13,573 14,473 14,764 14,538 09/30/1999 14,506 13,626 14,529 14,822 14,595 10/31/1999 14,566 13,682 14,589 14,883 14,654 11/30/1999 14,624 13,736 14,647 14,942 14,716 12/31/1999 14,694 13,802 14,717 15,006 14,781 01/31/2000 14,754 13,859 14,779 15,072 14,847 02/29/2000 14,815 13,916 14,841 15,137 14,911 03/31/2000 14,886 13,983 14,914 15,208 14,980 04/30/2000 14,947 14,040 14,975 15,280 15,047 05/31/2000 15,017 14,106 15,046 15,355 15,121 06/30/2000 15,095 14,179 15,124 15,427 15,195 07/31/2000 15,168 14,247 15,196 15,501 15,272 08/31/2000 15,247 14,321 15,277 15,578 15,350 09/30/2000 15,324 14,394 15,355 15,656 15,427 10/31/2000 15,401 14,466 15,432 15,738 15,507 11/30/2000 15,478 14,539 15,509 15,818 15,582 12/31/2000 15,562 14,617 15,593 15,902 15,660 01/31/2001 15,635 14,686 15,666 15,984 15,736 02/28/2001 15,703 14,751 15,733 16,053 15,801 03/31/2001 15,771 14,814 15,801 16,124 15,867
Investment Process -------------------------------------------------------------------------------- The Fund emphasizes current income and preservation of capital by applying PIMCO's analytical, research and trading skills. Although the Fund is largely restricted to investing in traditional money market instruments of the highest quality, there is some scope for performance enhancement through modest shifts in duration, yield curve and sector exposure as well as through intensive bottom-up credit and quantitative research. * Past performance is no guarantee of future results. Money market funds are neither insured nor guaranteed by FDIC or any other government agency and there can be no assurance that any money market fund will be able to maintain a net asset value of $1.00 per share. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 23 A NATIONAL TAX-EXEMPT BOND FUND PIMCO Municipal Bond Fund OBJECTIVE: High current income exempt from federal income tax, consistent with preservation of capital. PORTFOLIO: Investment grade municipal bonds. DURATION RANGE: 3-10 years FUND INCEPTION DATE: 12/31/97 TOTAL NET ASSETS: $80.1 million PORTFOLIO MANAGER: Mark McCray [PHOTO] Mark McCray Portfolio Manager Mr. McCray is responsible for municipal bond portfolios at PIMCO. Previously he was Co-Head of Municipal Bond Trading at Goldman Sachs & Co. and he has over 10 years of investment experience. Fund Highlights . 10.74% return outpaced Lipper Average. . Fed easing caused municipals to rally, with short-term yields dropping the most. . Quality issue selection boosted returns. . Moving forward, barbell approach should take maximum advantage of Fed easing and attractive risk-adjusted yields among longer-duration issues. Munis post solid year PIMCO Municipal Bond Fund delivered strong results for its shareholders, with Class A shares returning 10.74% for the one-year period ended March 31, 2001. This performance was slightly under the Fund's benchmark, the Lehman Municipal Bond Index, which returned 10.93%, but outperformed the Lipper Municipal Debt Fund Average, which returned 9.91%. Strong bond market The U.S. economy slowed considerably over the course of our fiscal year. The Federal Reserve began this period with a rate increase aimed at fighting inflation fears and ended the year with three rate cuts (for a total of 150 basis points) aimed at fighting recession. This environment was generally very favorable for bonds, with high quality bonds typically outperforming lower quality securities. Municipal bonds did very well in this environment, with short-term municipal yields falling further than their longer-term counterparts in response to Fed easings. Issue selection brings results PIMCO Municipal Bond Fund's emphasis on high quality issues greatly enhanced returns as investors focused on credit quality when attempting to counter diminishing corporate profitability. Quality issue selection also played a key role in increasing returns, helped by above-benchmark allocation to revenue bonds as well as holdings in the healthcare and housing industries, two sectors that are relatively less afflicted by an economic downturn. The Fund's below-benchmark duration for most of the year hurt returns due to the overall decline in municipal yields. An underweight position in shorter-maturity bonds also detracted from performance as these were the yields that fell the most in response to Fed easing. Economic weakness in the near term We believe that the U.S. economy will continue to struggle over the next two or three quarters, leading a worldwide slowdown. Banks throughout the world, including our own Federal Reserve, will likely cut interest rates in order to mitigate this slowdown. As a result, municipal bonds should produce attractive tax-adjusted returns under weakening U.S. economic growth due to overall solid credit quality in the municipal market and attractive tax-adjusted yields. In the months ahead, we intend to target the Municipal Bond Fund's duration slightly above the benchmark as slowing growth puts a cap on longer-term yields and municipal yields rally amid further Fed cuts. We expect to maintain our barbell approach, emphasizing a combination of short-duration issues to take advantage of Fed easing and longer-duration securities to take advantage of attractive risk-adjusted yields. We further hope to maintain our high quality stance in the face of continued economic weakness and credit erosion, but selectively add lower-tier issues where we see value. 24 PIMCO Funds Annual Report | 3.31.01 PIMCO Municipal Bond Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (12/31/97) PIMCO Municipal Bond Fund A Shares 10.74% 4.62% -- -- 4.48% PIMCO Municipal Bond Fund A Shares (adjusted) 7.42% 3.56% -- -- 3.51% PIMCO Municipal Bond Fund B Shares 9.92% 3.84% -- -- 3.70% PIMCO Municipal Bond Fund B Shares (adjusted) 4.92% 2.90% -- -- 2.84% PIMCO Municipal Bond Fund C Shares (adjusted) 9.20% 4.10% -- -- 3.96% Lipper Gen. Municipal Debt Fund Avg. 9.91% 4.04% -- -- -- Lehman Bros. General Municipal Bond Index 10.93% 5.59% -- -- --
MATURITY PROFILE 1-5 years 37% 5-10 years 28% 10-20 years 22% 20-30 years 13% Duration 7.2 years SECTOR BREAKDOWN Municipal Bonds & Notes 99.3% Other 0.7% QUALITY BREAKDOWN AAA 53.1% AA 13.6% A 6.8% BBB 18.7% BB 7.8% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] MUNICIPAL BOND FUND
Lehman Bros. PIMCO Municipal PIMCO Municipal PIMCO Municipal Municipal Bond DATE Bond A Bond B Bond C Index ------------------------------------------------------------------------------------------------ 12/31/1997 9,700 10,000 10,000 10,000 01/31/1998 9,812 10,108 10,110 10,103 02/28/1998 9,763 10,052 10,056 10,106 03/31/1998 9,768 10,051 10,057 10,115 04/30/1998 9,700 9,976 9,984 10,070 05/31/1998 9,890 10,164 10,174 10,229 06/30/1998 9,921 10,188 10,201 10,269 07/31/1998 9,928 10,189 10,205 10,294 08/31/1998 10,109 10,369 10,388 10,454 09/30/1998 10,242 10,499 10,520 10,585 10/31/1998 10,218 10,467 10,491 10,585 11/30/1998 10,242 10,485 10,511 10,622 12/31/1998 10,251 10,487 10,516 10,648 01/31/1999 10,384 10,617 10,648 10,775 02/28/1999 10,316 10,541 10,572 10,727 03/31/1999 10,322 10,541 10,575 10,742 04/30/1999 10,338 10,551 10,587 10,769 05/31/1999 10,260 10,465 10,503 10,707 06/30/1999 10,070 10,264 10,303 10,553 07/31/1999 10,088 10,275 10,316 10,591 08/31/1999 9,979 10,158 10,201 10,506 09/30/1999 9,963 10,136 10,180 10,510 10/31/1999 9,833 9,997 10,043 10,397 11/30/1999 9,932 10,092 10,140 10,507 12/31/1999 9,837 9,988 10,039 10,428 01/31/2000 9,778 9,922 9,975 10,383 02/29/2000 9,878 10,018 10,074 10,504 03/31/2000 10,101 10,237 10,295 10,734 04/30/2000 10,049 10,178 10,239 10,670 05/31/2000 10,002 10,124 10,186 10,615 06/30/2000 10,227 10,345 10,411 10,896 07/31/2000 10,351 10,464 10,533 11,048 08/31/2000 10,512 10,621 10,693 11,218 09/30/2000 10,503 10,605 10,679 11,159 10/31/2000 10,599 10,697 10,773 11,281 11/30/2000 10,572 10,662 10,741 11,367 12/31/2000 10,812 10,898 10,981 11,647 01/31/2001 10,908 10,988 11,074 11,763 02/28/2001 11,067 11,141 11,231 11,800 03/31/2001 11,187 10,953 11,347 11,907
Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. Rather than stretch for maximum yield, PIMCO's municipal bond team seeks to maximize after-tax total return. The portfolio is scrutinized using a process that models the potential changes in yield and price as the underlying variables of the overall municipal marketplace change. * Past performance is no guarantee of future results. The Fund may invest at least 80% of its assets in debt securities exempt from federal income tax. The Fund may invest 10% of its assets in high yield bonds, lower-rated securities generally involve greater risk to principal than investments in higher-rated securities and may at times invest in derivatives and mortgage related securities. The Fund may invest more than 25% of its assets in bond issuers of California and New York. The Fund may realize gains and shareholders will incur a tax liability from time to time. Income from the Fund is subject to state and local taxes & may at times be subject to the alternative minimum tax. It is important to note that a fund concentrating in a single state is subject to greater risk of adverse economic conditions and regulatory changes than a fund with broader geographical diversification. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 25 A TAX-EXEMPT BOND FUND PIMCO NY Municipal Bond Fund OBJECTIVE: Seek high current income exempt from federal and New York income tax. Capital appreciation is a secondary objective. PORTFOLIO: Primarily intermediate maturity municipal securities (exempt from federal and New York income tax). FUND INCEPTION DATE: 8/31/99 DURATION RANGE: 3-12 years TOTAL NET ASSETS: $4.1 million PORTFOLIO MANAGER: Mark McCray [PHOTO] Mark McCray Portfolio Manager Mr. McCray is responsible for municipal bond portfolios at PIMCO. Previously Co-Head of Municipal Bond Trading at Goldman Sachs & Co., he has over 10 years of investment experience. Fund Highlights . 12.38% return soundly beat Lipper Average. . Fed easing caused municipals to rally, with short-term yields dropping the most. . Focus on higher quality was key to outperformance. . Foresee relatively strong bond market ahead. NY Muni beats benchmark PIMCO NY Municipal Bond Fund delivered strong results for its shareholders, with Class A shares returning 12.38% for the one-year period ended March 31, 2001. This performance beat out the Fund's benchmark, the Lehman NY Insured Municipal Bond Index, which returned 12.13%, and soundly beat the average for its Lipper category, which returned 9.91%. Strong bond market Treasury yields fell this year as the U.S. economy slowed considerably. The Federal Reserve began this period with a rate increase aimed at fighting inflation fears and ended the year with three rate cuts (for a total of 150 basis points) aimed at fighting recession. This environment was generally very favorable for bonds, with high quality bonds typically outperforming lower quality securities. Municipal bonds did very well in this environment, with short-term municipal yields falling further than their longer-term counterparts in response to Fed easings. Issue selection brings results PIMCO Municipal Bond Fund's emphasis on shorter-maturity bonds helped performance as short-maturity NY municipal yields fell further than their longer-term counterparts. The Fund's bias toward high quality issues also enhanced returns as investors focused on credit quality when attempting to counter deteriorating credit and a slowing economy. The Fund's below-benchmark duration for most of the year hurt returns as New York municipal yields fell throughout the course of the year. Economic weakness in the near term We believe that the U.S. economy will continue to struggle over the next two or three quarters, leading a worldwide slowdown. Banks throughout the world, including our own Federal Reserve, will cut interest rates in order to mitigate this slowdown. As a result, New York municipal bonds should continue to produce attractive tax-adjusted returns under weakening U.S. economic growth due to their overall solid credit quality and attractive tax-adjusted yields. In the months ahead, we intend to target the Fund's duration above the benchmark as a weak economy and the prospects for further Fed easing put a cap on short- and intermediate-term municipal yields. We expect to maintain our barbell approach, emphasizing a combination of short-duration issues to take advantage of Fed easing and longer-duration securities to take advantage of attractive risk-adjusted yields. We further hope to maintain our high quality stance in the face of continued economic weakness and credit erosion, but selectively add lower-tier issues where we see value. 26 PIMCO Funds Annual Report | 3.31.01 PIMCO NY Municipal Bond Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (8/31/99) PIMCO NY Municipal Bond Fund A Shares 12.38% -- -- -- 8.81% PIMCO NY Municipal Bond Fund A Shares (adjusted) 9.01% -- -- -- 6.74% Lipper New York Intermediate Municipal Debt Fund Average 9.91% -- -- -- -- Lehman Bros. NY Ins. Municipal Bond Index 12.13% -- -- -- -- Lehman Bros. Intermediate NY Ins. Municipal Bond Index 10.73% -- -- -- --
MATURITY PROFILE Less than 1 year 20% 1-5 years 33% 5-10 years 23% 10-20 years 6% 20-30 years 9% Over 30 years 9% Duration 5.4 years SECTOR BREAKDOWN Municipal Bonds & Notes 91.8% Short-Term Instruments 8.2% QUALITY BREAKDOWN AAA 35.1% AA 20.3% A 15.5% BBB 29.1% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] NEW YORK MUNICIPAL BOND FUND PIMCO NY NY Interm. NY Ins. Municipal Municipal Municipal Bond MONTH Bond A Bond Index Index -------------------------------------------------------------------------------- 08/31/1999 9,700 10,000 10,000 09/30/1999 9,735 10,031 9,987 10/31/1999 9,655 9,983 9,848 11/30/1999 9,740 10,062 9,986 12/31/1999 9,701 10,019 9,883 01/31/2000 9,653 9,983 9,826 02/29/2000 9,712 10,037 9,973 03/31/2000 9,866 10,183 10,227 04/30/2000 9,807 10,146 10,128 05/31/2000 9,770 10,116 10,080 06/30/2000 10,006 10,363 10,407 07/31/2000 10,117 10,499 10,545 08/31/2000 10,321 10,652 10,731 09/30/2000 10,337 10,612 10,665 10/31/2000 10,461 10,707 10,800 11/30/2000 10,524 10,763 10,894 12/31/2000 10,731 10,993 11,235 01/31/2001 10,875 11,176 11,332 02/28/2001 10,952 11,162 11,342 03/31/2001 11,087 11,276 11,467 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. Rather than stretch for maximum yield, PIMCO's municipal bond team seeks to maximize after-tax total return. The portfolio is scrutinized using a process that models the potential changes in yield and price as the underlying variables of the NY municipal marketplace change. * Past performance is no guarantee of future results. The Fund may invest at least 80% of its assets in debt securities exempt from federal income tax. The Fund may invest 10% of its assets in high yield bonds, lower-rated securities generally involve greater risk to principal than investments in higher-rated securities and may at times invest in derivatives and mortgage related securities. The Fund may invest at least 65% of its assets in bond issuers of New York exempt from regular federal income tax and New York income tax. The Fund may realize gains and shareholders will incur a tax liability from time to time. Income from the Fund is subject to state and local taxes & may at times be subject to the alternative minimum tax. It's important to note that a fund concentrating in a single state is subject to greater risk of adverse economic conditions and regulatory changes than a fund with broader geographical diversification. This Fund is non-diversified, which means that it may concentrate its assets in a smaller number of issuers than a diversified Fund. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 27 AN INFLATION-INDEXED BOND FUND PIMCO Real Return Bond Fund OBJECTIVE: Maximum real return, consistent with preservation of real capital and prudent investment management. PORTFOLIO: Primarily inflation-indexed bonds. DURATION RANGE: N/A FUND INCEPTION DATE: 1/29/97 TOTAL NET ASSETS: $899.1 million PORTFOLIO MANAGER: John Brynjolfsson [PHOTO] John Brynjolfsson Portfolio Manager A renowned expert in his field, Mr. Brynjolfsson is co-author of Inflation-Protection Bonds and co-editor of The Handbook of Inflation-Indexed Bonds. He has 15 years of investment experience. Fund Highlights . 13.97% return beat benchmark and Lipper Average. . Treasury Inflation Protection Securities (TIPS) outperformed conventional bonds as the CPI increased more than the markets expected. . TIPS should continue to do well as the U.S. economic slowdown persists in the months ahead. Ahead of the competition PIMCO Real Return Bond Fund continued to deliver strong results to our shareholders in the year ending March 31, 2001. During this time, our 13.97% return topped both the benchmark and the Lipper Short U.S. Government Fund Average. This Fund has now outperformed its Lipper Average for the 1-, 3-year and since-inception periods. Falling real yields support TIPS The U.S. economy slowed considerably over the course of our fiscal year. As evidence, consider that the Federal Reserve began this period with a rate increase aimed at fighting inflation fears. The Fed ended the period with three rate cuts (for a total of 150 basis points) aimed at fighting recession. The net result was that real yields (nominal yield minus inflation) fell by an average of 80 basis points over the year. The yields on short and intermediate issues declined more than the yields on longer-term issues. Treasury Inflation Protection Securities (TIPS) did very well in this environment, outperforming similar maturity conventional bonds. Longer duration strategy on the mark Duration management played an important role in our performance this year. To get the maximum benefit from falling real yields, we maintained a longer-than-benchmark average duration. We also overweighted intermediate maturities, which saw more dramatic yield decreases than longer maturities. The Fund's performance was also helped by our above-benchmark exposure to inflation adjustments. This strategy proved effective as the Consumer Price Index increased more than the markets expected. Our portfolio yield was enhanced through the use of cash-management strategies. High quality corporate securities and asset-backed securities added value over traditional shorter-term investments. Favorable outlook for TIPS We believe the U.S. economy will continue to struggle over the next two to three quarters. We foresee the Federal Reserve easing rates down to 4%, or less, to mitigate the slowdown. TIPS should perform well in this type of market. We will be continuing many of our current strategies for the Fund going forward. We intend to keep the duration of the portfolio above-benchmark, with an overweighting in intermediate maturity TIPS. This should put us in a strong position when the real yield curve steepens in anticipation of more Fed easing. We will also be minimizing exposure to non-U.S. real return bonds going forward, as U.S. real yields are comparatively high. 28 PIMCO Funds Annual Report | 3.31.01 PIMCO Real Return Bond Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (1/29/97) PIMCO Real Return Bond Fund A Shares 13.97% 9.24% -- -- 7.65% PIMCO Real Return Bond Fund A Shares (adjusted) 10.55% 8.14% -- -- 6.87% PIMCO Real Return Bond Fund B Shares 13.12% 8.44% -- -- 6.86% PIMCO Real Return Bond Fund B Shares (adjusted) 8.12% 7.58% -- -- 6.47% PIMCO Real Return Bond Fund C Shares (adjusted) 12.42% 8.71% -- -- 7.11% Lipper Short U.S. Government Fund Avg. 9.16% 5.85% -- -- -- Lehman Bros. Inflation Linked Treas. Index 13.70% 7.94% -- -- --
MATURITY PROFILE Less than 1 year 6% 1-5 years 4% 5-10 years 57% 10-20 years 1% 20-30 years 32% Duration 2.0 years SECTOR BREAKDOWN U.S. Treasury Obligations 62.2% Corporate Bonds & Notes 20.6% Short-Term Instruments 11.9% Other 5.3% QUALITY BREAKDOWN AAA 76.5% AA 7.1% A 8.0% BBB 5.0% BB 3.1% B 0.3% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] REAL RETURN BOND FUND Lehman Bros. Infl. PIMCO Real PIMCO Real PIMCO Real Linked MONTH Return A Return B Return C Treas. Index -------------------------------------------------------------------------------- 01/31/1997 9,700 10,000 10,000 10,000 02/28/1997 9,735 10,029 10,032 10,033 03/31/1997 9,651 9,927 9,928 9,896 04/30/1997 9,698 9,978 9,977 9,956 05/31/1997 9,750 10,028 10,027 10,010 06/30/1997 9,726 9,997 9,996 9,978 07/31/1997 9,841 10,110 10,108 10,072 08/31/1997 9,858 10,121 10,124 10,103 09/30/1997 9,874 10,131 10,142 10,123 10/31/1997 9,995 10,249 10,263 10,227 11/30/1997 10,044 10,293 10,309 10,284 12/31/1997 9,989 10,230 10,249 10,241 01/31/1998 10,044 10,280 10,301 10,291 02/28/1998 10,030 10,260 10,282 10,282 03/31/1998 10,047 10,274 10,298 10,277 04/30/1998 10,097 10,318 10,344 10,315 05/31/1998 10,135 10,350 10,379 10,388 06/30/1998 10,167 10,376 10,407 10,414 07/31/1998 10,242 10,446 10,479 10,463 08/31/1998 10,246 10,444 10,479 10,486 09/30/1998 10,481 10,676 10,715 10,697 10/31/1998 10,533 10,722 10,763 10,721 11/30/1998 10,514 10,697 10,739 10,710 12/31/1998 10,466 10,640 10,685 10,646 01/31/1999 10,617 10,787 10,834 10,769 02/28/1999 10,589 10,752 10,802 10,693 03/31/1999 10,649 10,806 10,859 10,689 04/30/1999 10,822 10,973 11,029 10,760 05/31/1999 10,897 11,043 11,101 10,834 06/30/1999 10,879 11,018 11,079 10,841 07/31/1999 10,894 11,029 11,090 10,835 08/31/1999 10,947 11,075 11,139 10,854 09/30/1999 10,989 11,111 11,178 10,896 10/31/1999 11,007 11,122 11,191 10,918 11/30/1999 11,088 11,198 11,269 10,984 12/31/1999 11,021 11,122 11,195 10,896 01/31/2000 11,084 11,178 11,254 10,945 02/29/2000 11,161 11,250 11,329 11,047 03/31/2000 11,494 11,578 11,662 11,369 04/30/2000 11,636 11,715 11,802 11,520 05/31/2000 11,600 11,672 11,760 11,490 06/30/2000 11,751 11,816 11,909 11,635 07/31/2000 11,840 11,899 11,994 11,734 08/31/2000 11,949 12,000 12,099 11,821 09/30/2000 12,044 12,088 12,189 11,883 10/31/2000 12,169 12,205 12,311 12,026 11/30/2000 12,344 12,372 12,484 12,201 12/31/2000 12,456 12,476 12,591 12,332 01/31/2001 12,772 12,783 12,905 12,590 02/28/2001 13,005 13,008 13,136 12,803 03/31/2001 13,102 12,902 13,229 12,926 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The manager focuses on duration management and manages yield curve exposure based on the firm's outlook for real yields. Although the Fund is mainly invested in U.S. Treasury-Inflation Protection Securities (TIPS), sector rotation allows the manager to invest in other areas where he finds value on an inflation-adjusted basis. * Past performance is no guarantee of future results. The fund may invest up to 35% in foreign securities, which may entail greater risk due to foreign economic and political developments. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 29 A SHORT DURATION BOND FUND PIMCO Short-Term Fund OBJECTIVE: Maximum current income, consistent with preservation of capital and daily liquidity. PORTFOLIO: Primarily short-term investment grade bonds. DURATION RANGE: 0-1 year FUND INCEPTION DATE: 10/07/87 TOTAL NET ASSETS: $651.2 million PORTFOLIO MANAGER: Paul McCulley [PHOTO] Paul McCulley Portfolio Manager Mr. McCulley is Managing Director responsible for supervising short-term investment strategies at PIMCO. He has 19 years of investment experience. Fund Highlights . 7.23% return outpaced Lipper Average. . Fund's performance was supported by a strong U.S. bond market. . Above-Index duration boosted returns. . Continued economic weakness bodes well for higher-quality issues. Beating its benchmark I am pleased to report that PIMCO Short-Term Fund delivered strong results for our shareholders, with Class A shares returning 7.23% for the one-year period ended March 31, 2001. The Fund outperformed its benchmark, the Salomon 3-Month Treasury Bill Index, which returned 6.02%, and the Lipper Fund Average for its peers, which returned 7.10%. Bond market shows strength PIMCO Short-Term Fund's total return for the year was supported by one of the stronger bond markets in recent years. With the economy slowing sharply, default rates and downgrades rising in the corporate sector and investors anticipating further aggressive Federal Reserve easing, Treasury securities became the bond investment of choice. As a result, yields fell and higher-quality bonds outperformed lower-quality issues. Longer duration pays off PIMCO Short-Term Fund's emphasis throughout the year on an above-index duration boosted returns, as short-term interest rates fell substantially. In addition, investment-grade corporate holdings added to returns as Fed easing sparked a renewed belief in the economy that allowed corporates to gain ground. With real yields falling, real return bonds also added to relative returns, outperforming like-duration Treasuries. The Fund's small position in below-investment-grade corporate debt hurt performance as corporate profitability eroded and default rates increased. Economic weakness to continue We believe that growth will weaken globally, led by the U.S., which will continue to struggle over the next two or three quarters. We expect to maintain our extended duration position as weaker growth puts a cap on interest rates and benefits bond prices. Longer duration will also offset refinancing risk arising from mortgage holdings, which are expected to remain an emphasis in the portfolio given their relatively high yields and strong credit quality. Additionally, we intend to take advantage of relatively high yield premiums on select short-maturity, high-quality corporate issues. 30 PIMCO Funds Annual Report | 3.31.01 PIMCO Short-Term Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (10/7/87) PIMCO Short-Term Fund A Shares 7.23% 5.73% 6.10% 5.45% 6.08% PIMCO Short-Term Fund A Shares (adjusted) 5.09% 5.02% 5.67% 5.24% 5.92% PIMCO Short-Term Fund B Shares 6.44% 4.95% 5.35% 4.92% 5.67% PIMCO Short-Term Fund B Shares (adjusted) 1.44% 4.04% 5.02% 4.92% 5.67% PIMCO Short-Term Fund C Shares (adjusted) 5.91% 5.42% 5.79% 5.14% 5.77% Lipper Ultra-Short Obligations Fund Avg. 7.10% 5.69% 5.81% 5.43% -- Salomon Brothers 3-Mo. T-bill Index 6.02% 5.29% 5.27% 4.84% --
MATURITY PROFILE Less than 1 year 83% 1-5 years 7% 5-10 years 10% Duration 0.5 years SECTOR BREAKDOWN Corporate Bonds & Notes 35.5% U.S. Treasury Obligations 25.0% Mortgage-Backed Securities 16.1% U.S Government Agencies 13.8% Asset-Backed Securities 5.1% Other 4.5% QUALITY BREAKDOWN AAA 44.4% AA 10.7% A 23.9% BBB 18.3% BB 2.7% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] SHORT-TERM FUND Solomon PIMCO Short- PIMCO Short- PIMCO Short- Bros. 3- MONTH Term A Term B Term C month T-Bill -------------------------------------------------------------------------------- 10/31/1987 9,800 10,000 10,000 10,000 11/30/1987 9,855 10,049 10,053 10,051 12/31/1987 9,912 10,100 10,108 10,099 01/31/1988 9,976 10,160 10,172 10,148 02/29/1988 10,015 10,193 10,209 10,194 03/31/1988 10,067 10,240 10,260 10,244 04/30/1988 10,120 10,287 10,311 10,294 05/31/1988 10,173 10,336 10,364 10,347 06/30/1988 10,228 10,385 10,416 10,401 07/31/1988 10,277 10,429 10,464 10,460 08/31/1988 10,340 10,486 10,526 10,520 09/30/1988 10,405 10,546 10,589 10,583 10/31/1988 10,494 10,628 10,676 10,648 11/30/1988 10,561 10,690 10,742 10,715 12/31/1988 10,620 10,743 10,799 10,785 01/31/1989 10,693 10,811 10,871 10,858 02/28/1989 10,766 10,878 10,943 10,934 03/31/1989 10,858 10,963 11,033 11,013 04/30/1989 10,937 11,036 11,111 11,095 05/31/1989 11,033 11,127 11,207 11,179 06/30/1989 11,114 11,201 11,285 11,257 07/31/1989 11,205 11,286 11,374 11,336 08/31/1989 11,262 11,335 11,429 11,413 09/30/1989 11,336 11,403 11,502 11,487 10/31/1989 11,439 11,500 11,603 11,565 11/30/1989 11,513 11,567 11,675 11,640 12/31/1989 11,576 11,623 11,737 11,717 01/31/1990 11,629 11,670 11,789 11,794 02/28/1990 11,698 11,732 11,855 11,865 03/31/1990 11,773 11,800 11,927 11,945 04/30/1990 11,819 11,839 11,970 12,022 05/31/1990 11,927 11,941 12,078 12,104 06/30/1990 12,002 12,009 12,150 12,183 07/31/1990 12,083 12,082 12,228 12,263 08/31/1990 12,144 12,136 12,288 12,343 09/30/1990 12,223 12,207 12,364 12,418 10/31/1990 12,314 12,288 12,452 12,495 11/30/1990 12,410 12,377 12,545 12,569 12/31/1990 12,507 12,466 12,641 12,650 01/31/1991 12,594 12,545 12,725 12,723 02/28/1991 12,660 12,604 12,789 12,785 03/31/1991 12,715 12,651 12,842 12,851 04/30/1991 12,792 12,720 12,915 12,913 05/31/1991 12,861 12,781 12,982 12,975 06/30/1991 12,906 12,818 13,025 13,035 07/31/1991 12,979 12,883 13,096 13,097 08/31/1991 13,060 12,955 13,174 13,159 09/30/1991 13,129 13,016 13,239 13,217 10/31/1991 13,203 13,081 13,311 13,275 11/30/1991 13,233 13,104 13,339 13,328 12/31/1991 13,285 13,147 13,388 13,377 01/31/1992 13,332 13,186 13,432 13,424 02/29/1992 13,358 13,203 13,454 13,466 03/31/1992 13,380 13,218 13,474 13,512 04/30/1992 13,434 13,263 13,525 13,555 05/31/1992 13,473 13,293 13,562 13,600 06/30/1992 13,524 13,336 13,611 13,640 07/31/1992 13,578 13,380 13,661 13,681 08/31/1992 13,611 13,404 13,690 13,720 09/30/1992 13,645 13,430 13,720 13,754 10/31/1992 13,657 13,434 13,729 13,788 11/30/1992 13,672 13,440 13,740 13,823 12/31/1992 13,710 13,470 13,775 13,860 01/31/1993 13,754 13,505 13,816 13,897 02/28/1993 13,789 13,531 13,848 13,929 03/31/1993 13,851 13,582 13,906 13,964 04/30/1993 13,896 13,619 13,949 13,998 05/31/1993 13,949 13,662 13,999 14,033 06/30/1993 14,004 13,706 14,050 14,068 07/31/1993 14,053 13,746 14,095 14,104 08/31/1993 14,088 13,772 14,126 14,141 09/30/1993 14,122 13,797 14,157 14,176 10/31/1993 14,170 13,835 14,201 14,213 11/30/1993 14,221 13,877 14,249 14,249 12/31/1993 14,286 13,932 14,310 14,286 01/31/1994 14,309 13,946 14,330 14,323 02/28/1994 14,323 13,953 14,342 14,357 03/31/1994 14,299 13,920 14,313 14,398 04/30/1994 14,320 13,932 14,332 14,441 05/31/1994 14,329 13,931 14,336 14,488 06/30/1994 14,393 13,985 14,398 14,538 07/31/1994 14,460 14,041 14,461 14,590 08/31/1994 14,515 14,086 14,513 14,644 09/30/1994 14,529 14,092 14,525 14,698 10/31/1994 14,565 14,127 14,558 14,758 11/30/1994 14,576 14,137 14,565 14,820 12/31/1994 14,637 14,196 14,624 14,889 01/31/1995 14,708 14,266 14,691 14,957 02/28/1995 14,842 14,395 14,822 15,023 03/31/1995 14,873 14,426 14,848 15,097 04/30/1995 15,031 14,579 15,003 15,169 05/31/1995 15,181 14,724 15,148 15,243 06/30/1995 15,230 14,771 15,194 15,315 07/31/1995 15,321 14,860 15,280 15,388 08/31/1995 15,390 14,927 15,346 15,461 09/30/1995 15,533 15,066 15,484 15,530 10/31/1995 15,644 15,173 15,589 15,602 11/30/1995 15,788 15,312 15,728 15,670 12/31/1995 15,920 15,441 15,857 15,743 01/31/1996 15,995 15,514 15,927 15,813 02/29/1996 16,022 15,540 15,951 15,878 03/31/1996 16,072 15,588 15,997 15,945 04/30/1996 16,146 15,660 16,067 16,010 05/31/1996 16,228 15,740 16,146 16,079 06/30/1996 16,316 15,825 16,230 16,147 07/31/1996 16,362 15,869 16,271 16,216 08/31/1996 16,463 15,967 16,368 16,287 09/30/1996 16,619 16,119 16,521 16,357 10/31/1996 16,751 16,246 16,648 16,429 11/30/1996 16,900 16,391 16,793 16,498 12/31/1996 16,964 16,453 16,851 16,569 01/31/1997 17,064 16,550 16,946 16,641 02/28/1997 17,138 16,622 17,015 16,706 03/31/1997 17,144 16,628 17,020 16,779 04/30/1997 17,240 16,721 17,112 16,851 05/31/1997 17,363 16,840 17,230 16,925 06/30/1997 17,477 16,951 17,337 16,996 07/31/1997 17,612 17,082 17,467 17,070 08/31/1997 17,663 17,131 17,514 17,143 09/30/1997 17,780 17,244 17,626 17,215 10/31/1997 17,819 17,282 17,662 17,291 11/30/1997 17,895 17,357 17,736 17,363 12/31/1997 17,994 17,452 17,828 17,438 01/31/1998 18,098 17,553 17,928 17,515 02/28/1998 18,160 17,613 17,985 17,585 03/31/1998 18,280 17,729 18,100 17,662 04/30/1998 18,362 17,809 18,178 17,736 05/31/1998 18,443 17,887 18,255 17,813 06/30/1998 18,505 17,948 18,311 17,886 07/31/1998 18,614 18,054 18,414 17,961 08/31/1998 18,620 18,059 18,416 18,038 09/30/1998 18,743 18,179 18,532 18,112 10/31/1998 18,812 18,246 18,595 18,184 11/30/1998 18,874 18,306 18,652 18,252 12/31/1998 18,952 18,381 18,725 18,319 01/31/1999 19,024 18,451 18,792 18,387 02/28/1999 19,100 18,525 18,862 18,449 03/31/1999 19,234 18,654 18,990 18,520 04/30/1999 19,320 18,738 19,072 18,588 05/31/1999 19,322 18,740 19,070 18,659 06/30/1999 19,388 18,804 19,131 18,728 07/31/1999 19,454 18,868 19,190 18,801 08/31/1999 19,516 18,928 19,246 18,876 09/30/1999 19,602 19,012 19,325 18,950 10/31/1999 19,694 19,101 19,410 19,027 11/30/1999 19,786 19,191 19,495 19,103 12/31/1999 19,864 19,266 19,567 19,186 01/31/2000 19,917 19,318 19,620 19,270 02/29/2000 20,021 19,418 19,712 19,353 03/31/2000 20,149 19,542 19,833 19,444 04/30/2000 20,221 19,613 19,900 19,535 05/31/2000 20,329 19,717 20,002 19,631 06/30/2000 20,453 19,837 20,118 19,723 07/31/2000 20,557 19,938 20,216 19,818 08/31/2000 20,684 20,062 20,335 19,916 09/30/2000 20,802 20,176 20,447 20,016 10/31/2000 20,892 20,263 20,531 20,120 11/30/2000 21,059 20,425 20,691 20,223 12/31/2000 21,225 20,586 20,848 20,330 01/31/2001 21,370 20,726 20,984 20,436 02/28/2001 21,511 20,863 21,118 20,524 03/31/2001 21,605 20,955 21,205 20,614 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The Fund then employs a variety of value-added strategies geared to enhance yield, including duration extension, credit quality positioning, cost-effective trading and investment in an expanded set of financial instruments. * Past performance is no guarantee of future results. The fund may invest up to 5% in foreign securities, which may entail greater risk due to foreign economic and political developments. Investment in high yield, lower rated securities generally involves greater risk to principal than investment in higher rated securities. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 31 AN ENHANCED INDEX STOCK FUND PIMCO StocksPLUS Fund OBJECTIVE: Total return which exceeds that of the S&P 500. PORTFOLIO: Primarily S&P 500 Index futures and short-term bonds. DURATION RANGE: 0-1 year FUND INCEPTION DATE: 5/13/93 TOTAL NET ASSETS: $1.0 billion PORTFOLIO MANAGER: Bill Gross [PHOTO] Bill Gross Portfolio Manager Managing Director and co-founder of PIMCO, Mr. Gross is widely regarded as the world's foremost fixed income authority. He has over 30 years of investment experience. Recently, Mr. Gross and the PIMCO bond team were named Morningstar's 2000 Fixed Income Manager of the Year--making them the only two-time winner of the prestigious award. Fund Highlights . Fund slightly outperformed the S&P 500 Index in line with its objective. . Strong bond market helped returns, but couldn't overcome the stock market correction. . High quality bonds should remain the focus this year. What is StocksPLUS? PIMCO StocksPLUS Fund is an enhanced index stock fund that seeks total return in excess of the Standard & Poor's 500 Index (S&P 500) through investment in S&P 500 futures. These futures are purchased with a small percentage of the Fund's assets, freeing the remaining assets for investment in an actively managed portfolio of short-term, investment-grade bonds that can add incremental return beyond that of the S&P 500. S&P 500 melts down As its returns tend to shadow the S&P 500, the Fund had a difficult year, with Class A shares declining 21.31% for the one-year period ended March 31, 2001. This return slightly outperformed the S&P 500, which fell 21.68%, as well as the Lipper Large-Cap Core Fund Average, which fell 22.12%. Bonds can't carry stock wipeout Slow growth in the U.S., combined with three rate cuts by the Federal Reserve, drove Treasury yields down and bond prices up over the past year. That same slow growth, combined with a flight to quality, severely hurt returns in the equity markets. Generally, higher-quality bonds outperformed lower-quality bonds as defaults and downgrades increased within the corporate bond market. Mortgage-backed securities stay strong The StocksPLUS Fund's above-index duration boosted overall returns as short-term interest rates fell significantly. The Fund's fixed-income holdings in higher- quality areas of the bond market like mortgage-backed securities helped performance due to their relatively high yields and lower volatility. Real return bonds also boosted returns as real yields fell. The Fund's modest exposure to lower-quality, high-yield bonds hurt performance as concerns about a slowing economy drove investors to higher-quality areas of the bond market. Economic weakness in the near term We believe that the U.S. economy will continue to struggle over the next two or three quarters, leading a worldwide slowdown. Banks throughout the world, including our own Federal Reserve, will cut interest rates in order to mitigate this slowdown. In general, we expect bonds to perform relatively well in this environment, with higher-quality areas of the bond market doing best as credit deterioration continues amid slower growth. Going forward, we expect to maintain duration at or near the one-year maximum as slowing growth puts a ceiling on rates. This should also help to offset refinancing risk from mortgage holdings, which we expect to continue emphasizing in order to take advantage of relatively high yields and strong credit quality. We also expect to take advantage of relatively high yield premiums on select short-maturity, high-quality corporate issues and continue to favor real return bonds as real yields are expected to decline in the face of slowing global economic activity. 32 PIMCO Funds Annual Report | 3.31.01 PIMCO StocksPLUS Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (5/13/93) PIMCO StockPLUS Fund A Shares -21.31% 2.61% 13.60% -- 15.43% PIMCO StockPLUS Fund A Shares (adjusted) -23.67% 1.57% 12.91% -- 14.99% PIMCO StockPLUS Fund B Shares -21.91% 1.84% 12.75% -- 14.67% PIMCO StockPLUS Fund B Shares (adjusted) -25.48% 1.15% 12.53% -- 14.67% PIMCO StockPLUS Fund C Shares (adjusted) -22.38% 2.11% 13.04% -- 14.86% Lipper Large-Cap Core Fund Avg. -22.12% 1.88% 11.64% -- -- S&P 500 Index -21.68% 3.05% 14.18% -- --
MATURITY PROFILE Less than 1 year 39% 1-5 years 61% Duration 1.1 years SECTOR BREAKDOWN Mortgage-Backed Securities 49.7% Corporate Bonds & Notes 19.1% U.S. Treasury Obligations 8.7% Sovereign Issues 7.6% Short-Term Instruments 6.7% Asset-Backed Securities 6.3% Other 1.9% QUALITY BREAKDOWN AAA 74.0% AA 6.4% A 3.4% BBB 11.2% BB 5.0% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] STOCKSPLUS FUND PIMCO PIMCO PIMCO S&P 500 MONTH StocksPLUS A StocksPLUS B StocksPLUS C Index -------------------------------------------------------------------------------- 05/31/1993 9,700 10,000 10,000 10,000 06/30/1993 9,749 10,043 10,044 10,029 07/31/1993 9,727 10,015 10,016 9,989 08/31/1993 10,094 10,383 10,397 10,368 09/30/1993 9,993 10,276 10,289 10,288 10/31/1993 10,211 10,487 10,501 10,501 11/30/1993 10,092 10,362 10,376 10,401 12/31/1993 10,271 10,544 10,560 10,527 01/31/1994 10,605 10,880 10,899 10,885 02/28/1994 10,275 10,534 10,550 10,589 03/31/1994 9,818 10,052 10,084 10,128 04/30/1994 9,938 10,175 10,198 10,258 05/31/1994 10,120 10,350 10,384 10,426 06/30/1994 9,902 10,126 10,158 10,170 07/31/1994 10,284 10,510 10,546 10,504 08/31/1994 10,750 10,978 11,018 10,935 09/30/1994 10,563 10,784 10,823 10,668 10/31/1994 10,729 10,942 10,983 10,907 11/30/1994 10,397 10,593 10,642 10,510 12/31/1994 10,529 10,729 10,768 10,666 01/31/1995 10,816 11,009 11,061 10,943 02/28/1995 11,299 11,493 11,550 11,369 03/31/1995 11,603 11,800 11,849 11,705 04/30/1995 11,975 12,165 12,228 12,049 05/31/1995 12,513 12,706 12,774 12,531 06/30/1995 12,783 12,969 13,039 12,822 07/31/1995 13,185 13,375 13,448 13,247 08/31/1995 13,270 13,454 13,528 13,280 09/30/1995 13,829 14,006 14,096 13,841 10/31/1995 13,801 13,971 14,061 13,791 11/30/1995 14,461 14,624 14,720 14,397 12/31/1995 14,736 14,892 15,003 14,674 01/31/1996 15,259 15,421 15,522 15,174 02/29/1996 15,296 15,448 15,550 15,314 03/31/1996 15,494 15,638 15,755 15,462 04/30/1996 15,683 15,818 15,938 15,690 05/31/1996 16,039 16,165 16,288 16,094 06/30/1996 16,187 16,304 16,428 16,156 07/31/1996 15,429 15,537 15,655 15,442 08/31/1996 15,750 15,850 15,985 15,768 09/30/1996 16,667 16,760 16,902 16,655 10/31/1996 17,194 17,277 17,426 17,114 11/30/1996 18,466 18,544 18,706 18,408 12/31/1996 18,067 18,134 18,292 18,043 01/31/1997 19,177 19,218 19,402 19,171 02/28/1997 19,303 19,345 19,548 19,321 03/31/1997 18,446 18,461 18,657 18,527 04/30/1997 19,573 19,591 19,797 19,633 05/31/1997 20,812 20,817 21,036 20,828 06/30/1997 21,667 21,667 21,886 21,761 07/31/1997 23,438 23,407 23,661 23,493 08/31/1997 22,170 22,122 22,378 22,177 09/30/1997 23,311 23,261 23,519 23,392 10/31/1997 22,554 22,505 22,755 22,610 11/30/1997 23,474 23,394 23,670 23,657 12/31/1997 23,908 23,810 24,101 24,063 01/31/1998 24,214 24,115 24,409 24,329 02/28/1998 25,842 25,702 26,032 26,084 03/31/1998 27,128 26,971 27,305 27,420 04/30/1998 27,457 27,279 27,617 27,695 05/31/1998 26,897 26,701 27,053 27,219 06/30/1998 27,943 27,723 28,097 28,325 07/31/1998 27,633 27,393 27,763 28,023 08/31/1998 23,394 23,188 23,513 23,972 09/30/1998 25,186 24,932 25,288 25,507 10/31/1998 27,178 26,912 27,273 27,582 11/30/1998 28,722 28,408 28,806 29,254 12/31/1998 30,537 30,167 30,623 30,940 01/31/1999 31,560 31,159 31,631 32,233 02/28/1999 30,493 30,100 30,558 31,232 03/31/1999 31,765 31,340 31,808 32,481 04/30/1999 33,013 32,556 33,062 33,739 05/31/1999 32,145 31,670 32,166 32,943 06/30/1999 34,003 33,479 34,015 34,771 07/31/1999 32,881 32,344 32,865 33,685 08/31/1999 32,700 32,143 32,685 33,519 09/30/1999 31,954 31,407 31,939 32,600 10/31/1999 33,990 33,398 33,958 34,663 11/30/1999 34,534 33,889 34,481 35,367 12/31/1999 36,488 35,807 36,422 37,451 01/31/2000 34,620 33,935 34,525 35,570 02/29/2000 34,066 33,361 33,972 34,896 03/31/2000 37,248 36,470 37,115 38,310 04/30/2000 36,082 35,322 35,949 37,157 05/31/2000 35,339 34,537 35,180 36,394 06/30/2000 36,187 35,370 36,042 37,292 07/31/2000 35,706 34,899 35,534 36,708 08/31/2000 38,084 37,224 37,882 38,988 09/30/2000 35,989 35,176 35,795 36,930 10/31/2000 35,802 34,993 35,580 36,774 11/30/2000 33,106 32,358 32,862 33,875 12/31/2000 33,374 32,621 33,128 34,040 01/31/2001 34,652 33,870 34,374 35,248 02/28/2001 31,430 30,720 31,156 32,034 03/31/2001 29,311 28,650 29,069 30,005 Investment Process -------------------------------------------------------------------------------- Taking an innovative approach, the Fund combines a non-leveraged position in S&P 500 Index futures with an actively managed, short duration fixed-income portfolio. In doing so, the Fund seeks to capture the performance of the S&P 500 Index plus an incremental return based on the fixed income component. The manager adds value primarily through duration management, credit risk management and investment in a variety of high quality, short-term securities. * Past performance is no guarantee of future results. This Fund may invest substantially all of its assets in S&P 500 derivatives, backed by a portfolio of Fixed Income Instruments. The fund may invest up to 20% in foreign securities, which may entail greater risk due to foreign economic and political developments. The Fund may invest up to 10% in high yield securities, lower rated securities generally involves greater risk to principal than investment in higher rated securities, may at times invest in derivatives and mortgage related securities. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 33 A STOCK AND BOND FUND PIMCO Strategic Balanced Fund OBJECTIVE: Maximum total return. PORTFOLIO: S&P 500 Index futures and short-and intermediate-term investment grade bonds. DURATION RANGE: 0-6 years FUND INCEPTION DATE: 6/28/96 TOTAL NET ASSETS: $74.5 million PORTFOLIO MANAGER: Bill Gross [PHOTO] Bill Gross Portfolio Manager Managing Director and co-founder of PIMCO, Mr. Gross is widely regarded as the world's foremost fixed income authority. He has over 30 years of investment experience. Recently, Mr. Gross and the PIMCO bond team were named Morningstar's 2000 Fixed Income Manager of the Year--making them the only two-time winner of the prestigious award. Fund Highlights . Fund outperfomed its benchmark for the 1-year period. . Bond holdings tempered stock decline. . Bonds should perform relatively well in the months ahead amidst continued economic weakness. Balance holds steady PIMCO Strategic Balanced Fund is designed to provide broad exposure to both stocks and bonds by investing in a blended portfolio made up of the PIMCO StocksPLUS Fund and PIMCO Total Return Fund. The Fund's Class A shares returned -8.58% for the one-year period ended March 31, 2001, underperforming the Lipper Balanced Fund Average, which returned -6.26%. The Fund did, however, outperform its benchmark--a blend of 60% of the S&P 500 Index and 40% of the Lehman Brothers Aggregate Bond Index--which returned -9.09%. The Fund also outpaced its Lipper Average over the 3-year and since-inception periods. Bond returns beat out stocks Slow growth in the U.S., combined with three rate cuts by the Federal Reserve, drove Treasury yields down and bond prices up over the past year. That same slow growth combined with a flight to quality severely hurt returns in the equity markets. Generally, higher quality bonds outperformed lower quality bonds as defaults and downgrades increased within the corporate bond market. The Fund's asset allocation at the end of the quarter modestly favored stocks, with a 53% weight for stocks and a 47% weighting for bonds. Focus on bonds boosts returns The Strategic Balanced Fund's slight overweight toward bonds for much of the year boosted overall returns, while falling interest rates helped the short-term bonds backing its equity exposure. The Fund's fixed-income exposure to higher quality areas of the bond market like mortgage-backed securities helped performance due to their relatively high yields and lower volatility. More importantly, the Fund's substantial underweighting to lower quality, high yield corporate bonds dramatically enhanced returns. Real return bonds also boosted returns as real yields fell. Compared to the benchmark, the Fund's underweight in corporates did hurt returns in the first quarter of 2001. For most of the year, this strategy proved correct. But, when the Fed began easing rates, we saw a short-lived rally in the corporate bond market. Our minimal exposure meant we did not reap all the benefits of that rally. Additionally, the Fund's small Euro position was slightly negative as the Euro failed to rally against the dollar as U.S. growth slowed and growth in Europe remained solid. Economic weakness in the near term We believe that the U.S. economy will continue to struggle over the next two or three quarters, leading a worldwide slowdown. Banks throughout the world, including our own Federal Reserve, will cut interest rates in order to mitigate this slowdown. In general, we expect bonds to perform relatively well in this environment, with higher quality areas of the bond market doing best as credit deterioration continues amid slower growth. We anticipate targeting a neutral 60/40 percent equity/bond mix in the months ahead in light of stock market volatility and the potential for still further corporate earnings disappointments. In particular, we will extend our fixed-income duration one year above the benchmark and maintain our high quality focus, with an emphasis on short-term Eurozone issues. 34 PIMCO Funds Annual Report | 3.31.01 PIMCO Strategic Balanced Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (6/28/96) PIMCO Strategic Balanced Fund A Shares -8.58% 3.81% -- -- 11.21% PIMCO Strategic Balanced Fund A Shares (adjusted) -12.70% 2.22% -- -- 10.14% PIMCO Strategic Balanced Fund B Shares -9.28% 3.05% -- -- 10.40% PIMCO Strategic Balanced Fund B Shares (adjusted) -13.37% 2.28% -- -- 10.11% PIMCO Strategic Balanced Fund C Shares (adjusted) -10.13% 3.00% -- -- 10.36% Lipper Balanced Fund Average -6.26% 3.26% -- -- -- 60% S&P 500 40% LBAG -9.09% 5.01% -- -- -- S&P 500 Index -21.68% 3.05% -- -- --
SECTOR BREAKDOWN StocksPLUS Fund 55.0% Total Return Fund 39.2% Short-Term Instruments 5.8% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] STRATEGIC BALANCED FUND
PIMCO PIMCO PIMCO Lipper Strategic Strategic Strategic 60% S&P 500 Balanced S&P 500 MONTH Balanced A Balanced B Balanced C 40% LBAG Index Index ------------------------------------------------------------------------------------------------------------------- 06/30/1996 9,550 10,000 10,000 10,000 10,000 10,000 07/31/1996 9,289 9,720 9,720 9,746 9,743 9,558 08/31/1996 9,430 9,860 9,860 9,863 9,896 9,760 09/30/1996 9,875 10,319 10,319 10,264 10,262 10,309 10/31/1996 10,148 10,598 10,598 10,525 10,480 10,593 11/30/1996 10,707 11,176 11,176 11,075 10,968 11,394 12/31/1996 10,506 10,959 10,959 10,902 10,834 11,168 01/31/1997 10,944 11,409 11,409 11,324 11,165 11,866 02/28/1997 11,002 11,463 11,463 11,388 11,206 11,959 03/31/1997 10,648 11,087 11,087 11,057 10,880 11,468 04/30/1997 11,129 11,581 11,581 11,520 11,208 12,152 05/31/1997 11,589 12,053 12,053 11,984 11,666 12,892 06/30/1997 11,939 12,410 12,410 12,363 12,041 13,470 07/31/1997 12,666 13,157 13,157 13,086 12,726 14,542 08/31/1997 12,212 12,678 12,678 12,602 12,322 13,727 09/30/1997 12,657 13,130 13,130 13,090 12,814 14,479 10/31/1997 12,473 12,932 12,932 12,904 12,581 13,995 11/30/1997 12,795 13,258 13,258 13,286 12,811 14,643 12/31/1997 12,995 13,457 13,457 13,477 13,001 14,895 01/31/1998 13,169 13,628 13,628 13,635 13,092 15,059 02/28/1998 13,688 14,158 14,158 14,221 13,611 16,145 03/31/1998 14,150 14,626 14,626 14,678 14,028 16,972 04/30/1998 14,269 14,740 14,740 14,797 14,125 17,143 05/31/1998 14,118 14,575 14,575 14,700 13,982 16,848 06/30/1998 14,522 14,983 14,983 15,109 14,235 17,533 07/31/1998 14,438 14,888 14,888 15,025 14,068 17,346 08/31/1998 13,075 13,473 13,473 13,819 12,856 14,838 09/30/1998 13,840 14,253 14,253 14,480 13,411 15,789 10/31/1998 14,458 14,882 14,882 15,156 13,913 17,073 11/30/1998 14,918 15,346 15,346 15,742 14,422 18,108 12/31/1998 15,486 15,922 15,922 16,305 14,954 19,151 01/31/1999 15,852 16,288 16,288 16,760 15,193 19,952 02/28/1999 15,340 15,754 15,754 16,331 14,829 19,332 03/31/1999 15,834 16,250 16,250 16,759 15,195 20,105 04/30/1999 16,214 16,630 16,630 17,170 15,693 20,884 05/31/1999 15,873 16,271 16,271 16,866 15,452 20,391 06/30/1999 16,465 16,871 16,871 17,406 15,878 21,522 07/31/1999 16,103 16,487 16,461 17,051 15,581 20,851 08/31/1999 16,040 16,422 16,397 16,996 15,418 20,747 09/30/1999 15,840 16,215 16,189 16,796 15,220 20,179 10/31/1999 16,472 16,850 16,824 17,459 15,662 21,456 11/30/1999 16,623 16,991 16,967 17,671 15,831 21,892 12/31/1999 17,165 17,543 17,518 18,261 16,299 23,181 01/31/2000 16,424 16,771 16,745 17,687 15,890 22,017 02/29/2000 16,289 16,634 16,608 17,572 15,852 21,600 03/31/2000 17,314 17,650 17,628 18,696 16,786 23,713 04/30/2000 16,919 17,248 17,212 18,337 16,479 22,999 05/31/2000 16,811 17,110 17,086 18,108 16,324 22,527 06/30/2000 17,046 17,363 17,325 18,526 16,585 23,083 07/31/2000 16,990 17,292 17,268 18,420 16,540 22,722 08/31/2000 17,785 18,060 18,037 19,213 17,278 24,133 09/30/2000 17,155 17,413 17,393 18,653 16,915 22,859 10/31/2000 17,142 17,385 17,365 18,655 16,900 22,762 11/30/2000 16,622 16,857 16,821 17,894 16,286 20,968 12/31/2000 16,818 17,050 17,017 18,079 16,692 21,070 01/31/2001 17,271 17,494 17,476 18,583 17,046 21,818 02/28/2001 16,426 16,621 16,602 17,631 16,384 19,828 03/31/2001 15,828 15,809 15,986 16,996 15,855 18,572
Investment Process -------------------------------------------------------------------------------- The Strategic Balanced Fund seeks to provide broad exposure to both equity and fixed income classes. The Fund's equity exposure is achieved by investment in the PIMCO StocksPLUS Fund and the fixed income exposure is obtained by investment in the PIMCO Total Return Fund. Allocation decisions are based on PIMCO's consensus economic forecasts of business cycle phases. * Past performance is no guarantee of future results. The fund may invest up to 20% in foreign securities, which may entail greater risk due to foreign economic and political developments. The Fund may invest up to 10% in high yield securities, lower rated securities generally involves greater risk to principal than investment in higher rated securities, may at times invest in derivatives and mortgage related securities. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 35 AN INTERMEDIATE DURATION BOND FUND PIMCO Total Return Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management. PORTFOLIO: Primarily an intermediate-term portfolio of investment grade bonds. DURATION RANGE: 3-6 years FUND INCEPTION DATE: 5/11/87 TOTAL NET ASSETS: $42.5 billion PORTFOLIO MANAGER: Bill Gross [PHOTO] Bill Gross Portfolio Manager Managing Director and co-founder of PIMCO, Mr. Gross is widely regarded as the world's foremost fixed income authority. He has over 30 years of investment experience. Recently, Mr. Gross and the PIMCO bond team were named Morningstar's 2000 Fixed Income Manager of the Year--making them the only two-time winner of the prestigious award. Fund Highlights . 12.27% return soundly beat Lipper Average. . Returns were buoyed by a strong bond market. . Focus on higher quality key to outperformance. . Foresee relatively strong bond market ahead. A very good year I am pleased to report that PIMCO Total Return Fund delivered strong results for our shareholders, with Class A shares returning 12.27% for the one-year period ended March 31, 2001. This performance slightly trailed the Fund's benchmark, but once again soundly beat the Lipper Intermediate Investment-Grade Debt Fund Average. A lift from the market The Fund's performance was supported by one of the strongest bond markets in recent history, with the Lehman Brothers Aggregate Bond Index, a good proxy for the bond market as a whole, up 12.53% for the year ending March 31, 2001. The market thrived on signs of a slowing economy and three Federal Reserve rate cuts totaling 150 basis points. Higher quality focus PIMCO Total Return Fund's focus on higher quality areas of the bond market greatly enhanced performance during this year. In particular, compared to the benchmark, we were overweighted in mortgage-backed securities, which provided relatively high yields and lower market volatility. In addition, our above-average duration for much of the year helped performance as interest rates in general fell. The Fund's corporate bond exposure first helped and then hindered performance for the year. Compared to the benchmark, the Fund was very underweight in lower-quality high-yield corporates. For most of the year, this strategy proved correct. But, when the Fed began easing rates in the first quarter of 2001, we saw a short-lived rally in the corporate bond market. Our minimal exposure meant we did not reap all the benefits of that rally. Bond market should hold steady We believe that the U.S. economy will continue to struggle over the next two to three quarters. We expect bonds to perform relatively well in this environment, although risks of credit erosion remain a very real concern. As for the Fund, we anticipate keeping duration about one year above the benchmark and remaining focused on high-quality issues. In terms of sector strategies, we plan to continue overweighting mortgages, which we believe still offer relatively high yields and strong credit quality. We also plan to overweight real return bonds. We expect to underweight the Fund's corporate holdings because of the weaker growth and profit forecasts. But, we will selectively add top-quality corporate issues with compelling valuations. Elsewhere, we will look to increase the Fund's exposure to core European bonds, which should offer value as the economy slows and the European Central Bank eases interest rates. 36 PIMCO Funds Annual Report | 3.31.01 PIMCO Total Return Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (5/11/87) PIMCO Total Return Fund A Shares 12.27% 6.99% 7.81% 8.62% 8.82% PIMCO Total Return Fund A Shares (adjusted) 7.22% 5.35% 6.83% 8.12% 8.46% PIMCO Total Return Fund B Shares 11.44% 6.18% 7.02% 8.08% 8.42% PIMCO Total Return Fund B Shares (adjusted) 6.44% 5.30% 6.71% 8.08% 8.42% PIMCO Total Return Fund C Shares (adjusted) 10.44% 6.19% 7.02% 7.84% 8.02% Lipper Intermediate Investment Grade Debt Fund Avg. 11.21% 5.86% 6.61% 7.57% -- Lehman Bros. Agg. Bond Index 12.53% 6.88% 7.48% 7.98% --
MATURITY PROFILE Less than 1 year 2% 1-5 years 54% 5-10 years 20% 10-20 years 9% 20-30 years 14% Over 30 years 1% Duration 5.6 years SECTOR BREAKDOWN Mortgage-Backed Securities 50.8% Corporate Bonds & Notes 23.1% U.S. Treasury Obligations 8.9% Short-Term Instruments 7.7% Other 9.5% QUALITY BREAKDOWN AAA 73.5% AA 4.1% A 14.3% BBB 6.9% BB 1.2% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] TOTAL RETURN FUND PIMCO Total PIMCO Total PIMCO Total Lehman Bros. MONTH Return A Return B Return C Agg. Bond Index -------------------------------------------------------------------------------- 05/31/1987 9,550 10,000 10,000 10,000 06/30/1987 9,668 10,117 10,117 10,138 07/31/1987 9,641 10,082 10,082 10,130 08/31/1987 9,615 10,048 10,048 10,076 09/30/1987 9,371 9,787 9,787 9,861 10/31/1987 9,666 10,089 10,089 10,212 11/30/1987 9,733 10,152 10,152 10,294 12/31/1987 9,818 10,233 10,233 10,434 01/31/1988 10,215 10,642 10,642 10,801 02/29/1988 10,329 10,753 10,753 10,929 03/31/1988 10,233 10,646 10,646 10,827 04/30/1988 10,176 10,581 10,581 10,768 05/31/1988 10,122 10,518 10,518 10,696 06/30/1988 10,360 10,759 10,759 10,954 07/31/1988 10,343 10,735 10,735 10,897 08/31/1988 10,388 10,775 10,775 10,925 09/30/1988 10,581 10,969 10,969 11,172 10/31/1988 10,744 11,132 11,132 11,383 11/30/1988 10,644 11,021 11,021 11,244 12/31/1988 10,688 11,059 11,059 11,257 01/31/1989 10,816 11,184 11,184 11,419 02/28/1989 10,744 11,102 11,102 11,336 03/31/1989 10,790 11,143 11,143 11,385 04/30/1989 11,027 11,382 11,382 11,624 05/31/1989 11,291 11,647 11,647 11,929 06/30/1989 11,667 12,028 12,028 12,292 07/31/1989 11,910 12,271 12,271 12,554 08/31/1989 11,700 12,047 12,047 12,368 09/30/1989 11,754 12,096 12,096 12,431 10/31/1989 12,031 12,374 12,374 12,737 11/30/1989 12,132 12,470 12,470 12,858 12/31/1989 12,152 12,483 12,483 12,893 01/31/1990 11,944 12,262 12,262 12,740 02/28/1990 11,971 12,283 12,283 12,781 03/31/1990 11,957 12,261 12,261 12,790 04/30/1990 11,784 12,074 12,074 12,673 05/31/1990 12,165 12,457 12,457 13,048 06/30/1990 12,366 12,655 12,655 13,258 07/31/1990 12,563 12,847 12,847 13,441 08/31/1990 12,361 12,632 12,632 13,261 09/30/1990 12,368 12,632 12,632 13,371 10/31/1990 12,535 12,793 12,793 13,541 11/30/1990 12,846 13,103 13,103 13,832 12/31/1990 13,067 13,320 13,320 14,048 01/31/1991 13,192 13,440 13,440 14,222 02/28/1991 13,372 13,615 13,615 14,343 03/31/1991 13,536 13,774 13,774 14,442 04/30/1991 13,753 13,986 13,986 14,598 05/31/1991 13,850 14,077 14,077 14,684 06/30/1991 13,867 14,086 14,086 14,676 07/31/1991 14,061 14,275 14,275 14,880 08/31/1991 14,436 14,647 14,647 15,202 09/30/1991 14,773 14,980 14,980 15,510 10/31/1991 14,919 15,119 15,119 15,682 11/30/1991 15,043 15,235 15,235 15,826 12/31/1991 15,550 15,740 15,740 16,296 01/31/1992 15,418 15,596 15,596 16,074 02/29/1992 15,547 15,720 15,720 16,179 03/31/1992 15,482 15,644 15,644 16,088 04/30/1992 15,558 15,711 15,711 16,204 05/31/1992 15,874 16,021 16,021 16,510 06/30/1992 16,069 16,210 16,210 16,737 07/31/1992 16,456 16,591 16,591 17,078 08/31/1992 16,591 16,717 16,717 17,251 09/30/1992 16,848 16,966 16,966 17,456 10/31/1992 16,695 16,802 16,802 17,224 11/30/1992 16,703 16,800 16,800 17,228 12/31/1992 16,990 17,079 17,079 17,502 01/31/1993 17,298 17,378 17,378 17,838 02/28/1993 17,677 17,749 17,749 18,150 03/31/1993 17,772 17,836 17,836 18,226 04/30/1993 17,922 17,976 17,976 18,353 05/31/1993 17,957 18,001 18,001 18,376 06/30/1993 18,342 18,375 18,375 18,709 07/31/1993 18,448 18,471 18,471 18,815 08/31/1993 18,861 18,873 18,873 19,145 09/30/1993 18,931 18,934 18,934 19,197 10/31/1993 19,060 19,051 19,051 19,269 11/30/1993 18,886 18,868 18,868 19,105 12/31/1993 19,038 19,008 19,008 19,209 01/31/1994 19,262 19,221 19,221 19,468 02/28/1994 18,912 18,861 18,861 19,130 03/31/1994 18,505 18,444 18,444 18,658 04/30/1994 18,316 18,245 18,245 18,509 05/31/1994 18,223 18,141 18,141 18,507 06/30/1994 18,148 18,067 18,056 18,466 07/31/1994 18,513 18,430 18,408 18,832 08/31/1994 18,559 18,476 18,443 18,856 09/30/1994 18,318 18,236 18,192 18,578 10/31/1994 18,289 18,207 18,152 18,562 11/30/1994 18,283 18,201 18,136 18,521 12/31/1994 18,270 18,189 18,111 18,648 01/31/1995 18,590 18,507 18,417 19,017 02/28/1995 19,019 18,934 18,831 19,470 03/31/1995 19,193 19,107 18,991 19,589 04/30/1995 19,523 19,435 19,306 19,863 05/31/1995 20,134 20,044 19,897 20,631 06/30/1995 20,114 20,024 19,865 20,783 07/31/1995 20,118 20,028 19,857 20,736 08/31/1995 20,419 20,328 20,143 20,986 09/30/1995 20,668 20,576 20,377 21,191 10/31/1995 20,974 20,881 20,666 21,466 11/30/1995 21,421 21,325 21,094 21,788 12/31/1995 21,781 21,684 21,436 22,094 01/31/1996 21,951 21,853 21,590 22,240 02/29/1996 21,409 21,313 21,044 21,854 03/31/1996 21,235 21,140 20,861 21,702 04/30/1996 21,140 21,045 20,754 21,580 05/31/1996 21,074 20,980 20,678 21,536 06/30/1996 21,403 21,307 20,988 21,825 07/31/1996 21,450 21,354 21,021 21,885 08/31/1996 21,424 21,328 20,981 21,848 09/30/1996 21,908 21,810 21,443 22,229 10/31/1996 22,469 22,369 21,979 22,721 11/30/1996 22,993 22,890 22,478 23,111 12/31/1996 22,699 22,597 22,177 22,896 01/31/1997 22,771 22,669 22,241 22,966 02/28/1997 22,814 22,712 22,270 23,023 03/31/1997 22,532 22,431 21,980 22,768 04/30/1997 22,930 22,828 22,354 23,109 05/31/1997 23,157 23,054 22,560 23,327 06/30/1997 23,421 23,317 22,803 23,604 07/31/1997 24,068 23,960 23,417 24,240 08/31/1997 23,851 23,745 23,190 24,034 09/30/1997 24,230 24,122 23,545 24,388 10/31/1997 24,512 24,402 23,801 24,742 11/30/1997 24,614 24,504 23,889 24,856 12/31/1997 24,893 24,781 24,142 25,106 01/31/1998 25,268 25,155 24,493 25,428 02/28/1998 25,190 25,077 24,402 25,408 03/31/1998 25,266 25,153 24,460 25,497 04/30/1998 25,354 25,241 24,534 25,630 05/31/1998 25,641 25,526 24,794 25,873 06/30/1998 25,882 25,766 25,012 26,092 07/31/1998 25,957 25,841 25,070 26,148 08/31/1998 26,359 26,241 25,443 26,573 09/30/1998 27,139 27,018 26,181 27,196 10/31/1998 26,949 26,829 25,979 27,052 11/30/1998 27,041 26,920 26,052 27,205 12/31/1998 27,195 27,073 26,182 27,287 01/31/1999 27,347 27,225 26,316 27,482 02/28/1999 26,833 26,713 25,808 27,002 03/31/1999 27,053 26,932 26,004 27,152 04/30/1999 27,178 27,056 26,106 27,238 05/31/1999 26,873 26,753 25,798 26,999 06/30/1999 26,820 26,700 25,730 26,913 07/31/1999 26,710 26,590 25,607 26,799 08/31/1999 26,723 26,603 25,602 26,785 09/30/1999 27,012 26,891 25,863 27,096 10/31/1999 27,093 26,971 25,925 27,196 11/30/1999 27,147 27,025 25,961 27,194 12/31/1999 26,995 26,874 25,798 27,063 01/31/2000 26,846 26,726 25,640 26,974 02/29/2000 27,166 27,044 25,930 27,300 03/31/2000 27,557 27,434 26,285 27,660 04/30/2000 27,472 27,349 26,188 27,581 05/31/2000 27,458 27,335 26,157 27,568 06/30/2000 28,029 27,904 26,682 28,142 07/31/2000 28,276 28,149 26,901 28,397 08/31/2000 28,711 28,583 27,297 28,809 09/30/2000 28,800 28,671 27,365 28,990 10/31/2000 28,973 28,843 27,510 29,182 11/30/2000 29,529 29,397 28,022 29,659 12/31/2000 30,120 29,985 28,563 30,209 01/31/2001 30,547 30,411 28,951 30,703 02/28/2001 30,831 30,694 29,203 30,971 03/31/2001 30,942 30,804 29,290 31,126 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO investment professionals develop a 3 to 5-year outlook for the global economy and interest rates. Quarterly meetings are then held to forecast specific influencing factors, including interest rate volatility, yield curve movements and credit trends. Taken together, these sessions set the basic portfolio parameters. Bottom-up strategies are then meshed with the top-down strategies to create value. * Past performance is no guarantee of future results. The fund may invest up to 20% in foreign securities, which may entail greater risk due to foreign economic and political developments. Investment in high yield, lower rated securities generally involves greater risk to principal than investment in higher rated securities. Mortgage-backed securities may be sensitive to changes in prevailing interest rates, when they rise the value generally declines. There is no assurance that the private guarantors or insurers will meet their obligations. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 37 AN INTERMEDIATE DURATION BOND FUND PIMCO Total Return Mortgage Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management. PORTFOLIO: Primarily mortgage-backed securities. DURATION RANGE: 2-6 years FUND INCEPTION DATE: 7/31/97 TOTAL NET ASSETS: 25.1 million PORTFOLIO MANAGER: Scott Simon [PHOTO] Scott Simon Portfolio Manager An acclaimed expert in his field, Mr. Simon is head of mortgage securities at PIMCO and is a senior member of its portfolio management and investment strategy groups. He has 18 years of investment experience. Fund Highlights . 12.68% return surpassed benchmark and Lipper Average. . Slowing U.S. economy was positive for bond performance. . Above-index duration helped relative return. . Continued economic weakness bodes well for high-quality mortgages, especially GNMA issues. Returns outpace benchmark PIMCO Total Return Mortgage Fund Class A shares returned 12.68% for the one-year period ended March 31, 2001. This performance surpassed our benchmark and the Lipper U.S. Mortgage Fund Average. The Fund also outperformed its Lipper Average for the 3-year and since-inception periods. Strong bond market The U.S. economy slowed considerably over the year ending March 31, 2001. While we started this period with the Fed raising rates on inflation fears, we ended with three consecutive rate cuts (for a total of 150 basis points). This environment was generally very favorable for bonds. But, we also saw downgrades and defaults, driving investors toward higher-quality securities. As for the mortgage-backed market, the lower rates encouraged homeowners to refinance, increasing the risk of prepayment. We believe, however, that the additional yield offered by mortgage-backed securities offsets that risk. Longer duration boosts return To get the maximum benefit from falling rates, we kept the Fund's duration slightly longer than its benchmark. This strategy was instrumental in helping us to outperform our benchmark. Protecting ourselves against prepayment risk was also a significant factor in our relative performance last year. For example, our investments in Commercial Mortgage Backed Securities (CMBS) enhanced returns, because these securities are less vulnerable to prepayment risk. The Fund's relative performance was hindered slightly by our GNMA (Ginnie Mae) investments, at the expense of Freddie Mac and Fannie Mae. Our strategy was based on investors' concerns that the federal government would restrict the activities of Freddie Mac and Fannie Mae. These concerns abated, however, and these issues actually outperformed Ginnie Maes. Quality is the watchword We believe that the U.S. economy will continue to struggle over the next several quarters. Banks worldwide will most likely ease rates to mitigate this slowdown, including our own Federal Reserve. In general we expect bonds to perform relatively well in this environment, with higher-quality areas doing best. Our strategy for the Fund in this type of market is to maintain our above-index duration and our focus on quality. In terms of specific sector plays, we intend to stay overweight in GNMA securities, as their government guaranty becomes more valuable when credit quality is deteriorating. These securities also add yield during a period of decreasing interest rates. 38 PIMCO Funds Annual Report | 3.31.01 PIMCO Total Return Mortgage Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (7/31/97) PIMCO Total Return Mortgage Fund A Shares 12.68% 7.27% -- -- 7.72% PIMCO Total Return Mortgage Fund A Shares (adjusted) 7.61% 5.65% -- -- 6.38% PIMCO Total Return Mortgage Fund B Shares 11.84% 6.47% -- -- 6.92% PIMCO Total Return Mortgage Fund B Shares (adjusted) 6.84% 5.58% -- -- 6.23% PIMCO Total Return Mortgage Fund C Shares (adjusted) 10.82% 6.47% -- -- 6.92% Lipper U.S. Mortgage Fund Avg. 11.48% 6.08% -- -- -- Lehman Brothers Mortgage Index 12.64% 6.97% -- -- --
MATURITY PROFILE Less than 1 year 7% 1-5 years 68% 5-10 years 20% 10-20 years 2% 20-30 years 2% Over 30 years 1% Duration 3.2 years SECTOR BREAKDOWN Mortgage-Backed Securities 83.4% Short-Term Instruments 15.3% Other 1.3% QUALITY BREAKDOWN AAA 97.1% AA 2.9% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] TOTAL RETURN MORTGAGE FUND PIMCO Total PIMCO Total PIMCO Total Return Mort. Return Mort. Return Mort. Lehman MONTH Fund A Fund B Fund C Mortgage Index -------------------------------------------------------------------------------- 07/31/1997 9,550 10,000 10,000 10,000 08/31/1997 9,557 10,000 10,000 9,976 09/30/1997 9,705 10,149 10,149 10,103 10/31/1997 9,847 10,290 10,290 10,215 11/30/1997 9,890 10,329 10,329 10,248 12/31/1997 10,004 10,442 10,442 10,342 01/31/1998 10,111 10,547 10,547 10,445 02/28/1998 10,127 10,559 10,559 10,467 03/31/1998 10,162 10,588 10,588 10,511 04/30/1998 10,228 10,651 10,651 10,570 05/31/1998 10,314 10,733 10,733 10,641 06/30/1998 10,379 10,794 10,794 10,691 07/31/1998 10,418 10,828 10,828 10,746 08/31/1998 10,541 10,949 10,949 10,843 09/30/1998 10,656 11,063 11,063 10,974 10/31/1998 10,612 11,010 11,010 10,960 11/30/1998 10,656 11,049 11,049 11,015 12/31/1998 10,684 11,070 11,070 11,061 01/31/1999 10,747 11,128 11,128 11,140 02/28/1999 10,688 11,061 11,061 11,096 03/31/1999 10,755 11,124 11,124 11,170 04/30/1999 10,806 11,170 11,170 11,222 05/31/1999 10,744 11,099 11,099 11,159 06/30/1999 10,730 11,078 11,078 11,120 07/31/1999 10,688 11,028 11,028 11,045 08/31/1999 10,680 11,013 11,013 11,044 09/30/1999 10,824 11,155 11,155 11,223 10/31/1999 10,874 11,200 11,200 11,288 11/30/1999 10,924 11,244 11,244 11,294 12/31/1999 10,899 11,211 11,211 11,267 01/31/2000 10,825 11,128 11,128 11,169 02/29/2000 10,986 11,287 11,287 11,298 03/31/2000 11,131 11,428 11,428 11,422 04/30/2000 11,090 11,379 11,379 11,430 05/31/2000 11,082 11,363 11,363 11,435 06/30/2000 11,286 11,565 11,565 11,680 07/31/2000 11,394 11,669 11,669 11,755 08/31/2000 11,578 11,851 11,851 11,933 09/30/2000 11,691 11,960 11,960 12,056 10/31/2000 11,769 12,033 12,032 12,143 11/30/2000 11,957 12,216 12,215 12,326 12/31/2000 12,181 12,438 12,437 12,524 01/31/2001 12,369 12,623 12,621 12,719 02/28/2001 12,484 12,729 12,729 12,792 03/31/2001 12,543 12,479 12,778 12,866 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The manager then seeks to add value primarily through interest rate strategies and by exploiting many areas of the mortgage market. PIMCO's advanced proprietary analytics are critical to issue selection and risk management. * Past performance is no guarantee of future results. This Fund concentrates on investments in mortgage securities, which may entail greater risk than a fully diversified fund. The Fund may invest in U.S. dollar-denominated securities of foreign issuers, securities less than AAA ratings but not lower than BBB ratings and may invest in derivative instruments. See page 40 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 39 Footnotes The following notes and definitions should help provide a more complete understanding of the performance figures. Past performance is no guarantee of future results. Investment return will fluctuate and the value of an investor's shares will fluctuate and may be worth more or less than original cost when redeemed. The average annual total return measures performance assuming that all dividend and capital gain distributions were reinvested. Emerging Markets Bond, Global Bond II & Real Return Bond Fund Instl. shares and retail shares commenced operations on the same day but for the rest of the PIMS Funds the returns represent the blended performance of the Fund's retail shares (Class A, B or C) and the prior performance of the Fund's Institutional shares, adjusted, as necessary, to reflect retail share current sales charges and different operating expenses. The retail shares were first offered in January 1997 for the PIMS Funds except CA Intermediate Municipal A on 10/99 & D on 1/00, CA Muni A on 8/00 & D on 5/00, NY Municipal A on 10/99 & D on 1/00, Convertible on 5/99, Municipal Bond on 4/98, Strategic Balanced on 5/99 & Total Return Mortgage on 8/00, respectively. Returns for Class A shares adjusted include the effect of the 4.5% maximum initial sales charge for the PIMS Funds except for CA Intermediate Municipal, CA Municipal, Low Duration, Municipal, NY Municipal, Real Return & StocksPLUS are all 3% and Short-Term Bond Fund is 2%, respectively. Returns for Class B shares include the effect of paying the contingent deferred sales charge (CDSC), which declines from 5% in the first year to 0% at the beginning of the seventh year. Returns are for Class C shares. Returns for Class C shares have a 1% CDSC, which may apply in the first year of ownership. The credit quality of the investment in the portfolio does not apply to the stability or safety of the fund. Duration is a measure of the Fund's price sensitivity expressed in years. The Growth of $10,000 does include the effect of the maximum initial sales charge only associated with class A shares. Money market funds are neither insured nor guaranteed by FDIC or any other government agency and there can be no assurance that any money market fund will be able to maintain a net asset value of $1.00 per share. Savings accounts & CD's are guaranteed as to repayment of principal and interest by an agency of the U.S. government. However, the investment return and principal value of bonds and bond funds will fluctuate. The Lipper Averages are calculated by Lipper, Inc. It is the total return performance average of funds that are tracked by Lipper that have the same Fund Classification. Lipper does not take into account sales charges. Lehman CA Intermediate Index is an unmanaged index comprised of California Municipal Bond issues with a maturity range of 5-10 Years. Lehman CA Insured Muni. is an unmanaged index comprised of insured California Municipal Bond Issues. First Boston Convertible Bond Index is an unmanaged market index comprised of convertible bonds. J.P. Morgan Emerging Markets Bond Index tracks total returns for Brady Bonds. Countries covered are Argentina, Brazil, Bulgaria, Ecuador, Mexico, Nigeria, Panama, Peru, Poland and Venezuela. J.P. Morgan Non-U.S. (Hedged) is an unmanaged market index representative of the total return performance in U.S. dollars of major non-U.S. bond markets. J.P. Morgan Global (Hedged) is an unmanaged market index representative of the total return performance in U.S. dollars on a hedged basis of major world bond markets. Lehman Intermediate BB High Yield is an unmanaged market index comprised of various fixed income securities rated BB. Lehman Long Term Treasury is an unmanaged index comprised of various fixed income maturities greater than 10 years. Merrill Lynch 1-3 Yr. Treasury is an unmanaged market index made up of U.S. Treasury issues with maturities from 1-3 years. Salomon 3-month T-bill is an unmanaged index representing monthly return equivalents of yield averages of the last 3-month Treasury Bill issues. Lehman General Municipal is an unmanaged index representative of the tax-exempt bond market. The index is made up of all investment grade municipal bonds issued after 12/31/90 having a remaining maturity of at least one-year. Lehman NY Insured Muni is an unmanaged index comprised of insured New York Municipal Bond issues. Lehman Inflation Linked Treasury is an unmanaged market index comprised of all U.S. Inflation Linked Treasuries. S&P 500 Index is an unmanaged market index generally considered to be representative of the stock market as a whole. 60% S&P/ 40% LBAG is an unmanaged index comprised of 60% of the return of the S&P 500 Index and 40% of the Lehman Brothers Aggregate Bond Index. Lehman Aggregate Bond is an unmanaged market index representative of the U.S. Taxable fixed income universe. Lehman Mortgage is an unmanaged market index representing fixed rate mortgage issued by GNMA, FNMA and FHLMC. It is not possible to invest directly in an unmanaged index. The funds also offer other share classes, which are subject to different fees and expenses (which may affect performance), have different minimum investment requirements and are entitled to different services. Information regarding such classes may be obtained by calling 1-888-87-PIMCO. For additional details on the Funds, contact your financial advisor to receive a current prospectus that contains more complete information, including charges and expenses. Please read the prospectus carefully before you invest or send money. PIMCO Funds Distributors LLC, 2187 Atlantic Street, Stamford, CT, 06902, www.pimcofunds.com, 1-888-87-PIMCO. 40 PIMCO Funds Annual Report | 3.31.01 PIMCO Schedule of Investments A, B, and C Classes California Intermediate Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 100.4% -------------------------------------------------------------------------------- California 75.1% A B C California Unified School District General Obligation, (FGIC Insured), Series 2000 0.000% due 08/01/2029 $ 1,715 $ 384 A B C California Unified School District General Obligation, (FGIC Insured), Series 2001 0.000% due 08/01/2026 1,600 422 0.000% due 08/01/2027 1,145 286 0.000% due 08/01/2028 1,310 310 0.000% due 08/01/2030 1,850 390 0.000% due 08/01/2031 1,285 257 0.000% due 08/01/2032 1,965 373 0.000% due 08/01/2033 1,670 300 0.000% due 08/01/2034 1,755 299 Alameda, California Harbor Bay Business Park Assessment Revenue Bonds, Series 1998 5.500% due 09/02/2012 3,500 3,506 Anaheim, California Public Financing Authority Revenue Bonds, (AMBAC Insured), Series 1999 4.625% due 10/01/2027 150 157 Antioch, California Public Financing Authority Reassessment Revenue Bonds, Series 1998-B 5.500% due 09/02/2008 495 509 California Educational Facilities Authority Revenue Bonds, Series 1997-A 5.700% due 10/01/2015 135 146 California Health Facilities Financing Authority Revenue Bonds, (CA MTG Insured), Series 2000 5.000% due 09/01/2010 350 366 California Health Facilities Financing Authority Revenue Bonds, (MBIA Insured), Series 1998-A 5.375% due 08/15/2030 1,100 1,117 California Health Facilities Financing Authority Revenue Bonds, Series 1998-B 5.250% due 10/01/2014 3,000 3,025 California Housing Financial Agency Revenue Bonds, (AMBAC FHA Insured), Series 1996 5.950% due 02/01/2011 100 108 California Pollution Central Financing Authority Revenue Bonds, (MBIA Insured), Series 1996 5.350% due 12/01/2016 1,000 1,013 California Pollution Control Financing Authority Revenue Bonds, Series 1999-A 4.500% due 08/01/2003 150 152 California State Department of Water Resources Central Valley Project Revenue Bonds, Series 1993 5.700% due 12/01/2016 1,750 1,829 California State Department Veteran Affairs Home Revenue Bonds, Series 2000-B 4.900% due 12/01/2005 500 507 California State General Obligation Bonds, (FGIC Insured), Series 1997 5.000% due 10/01/2004 325 343 California State General Obligation Bonds, (MBIA Insured), Series 1991 6.600% due 02/01/2011 1,000 1,187 California State General Obligation Bonds, (MBIA Insured), Series 1992 7.500% due 10/01/2007 400 482 California State General Obligation Bonds, Series 1991 6.500% due 09/01/2010 1,730 2,037 California State General Obligation Bonds, Series 1997-BL 5.300% due 12/01/2012 400 421 California State General Obligation Bonds, Series 2000 5.250% due 03/01/2005 100 106 5.250% due 03/01/2013 300 318 5.700% due 12/01/2032 1,775 1,811 6.310% due 01/01/2027 (d) 1,500 1,435 California State General Obligation Bonds, Series 2001 5.500% due 03/01/2012 2,000 2,183 5.125% due 03/01/2031 500 497 California State Public Works Board Lease Revenue Bonds, Series 1994-A 6.375% due 11/01/2014 500 560 California Statewide Communities Development Authority Apartment Development Revenue Bonds, Series 1998-A-3 5.100% due 05/15/2025 2,000 2,010 California Statewide Communities Development Authority Certificates of Participation, (AMBAC Insured), Series 1995 3.600% due 07/01/2015 (d) 1,100 1,100 California Statewide Communities Development Authority Certificates of Participation, Series 1994 6.500% due 07/01/2015 1,000 1,115 California Statewide Communities Development Authority Revenue Bonds, Series 2001 5.125% due 10/01/2030 1,950 1,925 Capistrano, California Unified School District Community Facilities District Special Tax Bonds, Series 1997 7.100% due 09/01/2021 2,000 2,357 Capistrano, California Unified School District Community Facilities District Special Tax Bonds, Series 1999 5.700% due 09/01/2020 1,500 1,483 Chico, California Public Financing Authority Revenue Bonds, (FSA Insured), Series 1996 5.200% due 04/01/2011 485 512 Chula Vista, California Special Tax Bonds, Series 2000-1 6.350% due 09/01/2017 230 239 6.400% due 09/01/2018 120 124 Corona, California Community Facilities District Special Tax Bonds, Series 1998 5.875% due 09/01/2023 1,000 996 East Bay, California Municipal District Wastewater Treatment System Revenue, Series 1993 5.550% due 06/01/2020 (d) 6,000 6,328 East Bay, California Municipal Utility District Wastewater Treatment System Revenue Bonds, (AMBAC Insured), Series 1993 6.420% due 06/01/2013 3,450 3,749 East Bay, California Regional Park District General Obligation Bonds, Series 1998 5.000% due 09/01/2017 2,000 2,025 Evergreen, California School District General Obligation Bonds, (FGIC Insured), Series 2000-C 10.000% due 09/01/2005 465 586 10.000% due 09/01/2006 380 497 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 41 PIMCO Schedule of Investments A, B, and C Classes (Cont.) California Intermediate Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, Series 1995 0.000% due 01/01/2026 $ 1,000 $ 272 Foothill Eastern Transportation Corridor Agency Toll Road Revenue Bonds, (MBIA Insured), Series 1999 5.875% due 01/15/2027 2,500 1,630 Fresno, California Special Tax, Series 1998 4.750% due 09/01/2005 980 983 Livermore Valley, California Joint Unified School District General Obligation Bonds, (MBIA Insured), Series 2000 6.500% due 08/01/2003 1,000 1,073 Livermore-Amador Water Management Agency California Revenue Bonds, (AMBAC Insured), Series 2001 5.000% due 08/01/2031 3,500 3,441 Long Beach, California Harbor Revenue Bonds, (MBIA Insured), Series 1995 6.500% due 05/15/2005 220 243 Long Beach, California Harbor Revenue Bonds, Series 1993 4.700% due 05/15/2004 150 155 Los Angeles County, California Transportation Commission Certificates of Participation, Series 1992-B 6.250% due 07/01/2004 500 527 Los Angeles, California Community Redevelopment Agency Certificates of Participation Revenue Bonds, Series 1984 7.550% due 11/01/2008 390 435 Los Angeles, California State Building Authority Lease Revenue Bonds, Series 1999-A 4.600% due 10/01/2007 150 157 Los Angeles, California Unified School District General Obligation Bonds, (MBIA Insured), Series 1999-C 4.750% due 07/01/2010 30 32 Metropolitan Water District Southern California General Obligation Bonds, Series 1993-A1 7.250% due 03/01/2007 150 177 Metropolitan Water District Southern California Revenue Bonds, Series 1993 6.050% due 10/30/2020 (d) 600 623 Orange County, California Community Facilities District Special Tax, Series 2000 5.600% due 08/15/2011 455 460 5.700% due 08/15/2012 485 490 5.800% due 08/15/2013 600 604 6.200% due 08/15/2018 1,025 1,033 Orange County, California Local Transportation Authority Sales Tax Revenue Bonds, (AMBAC-TCRS Insured), Series 1992 6.200% due 02/14/2011 3,250 3,816 Orange County, California Revenue Bonds, (MBIA Insured), Series 1995-A 6.000% due 06/01/2010 1,000 1,148 Oxnard, California Improvement Bond Act 1915 Special Assessment, Series 1997 5.500% due 09/02/2004 1,205 1,232 Pacific Housing & Finance Agency, California Revenue Bonds, (MBIA Insured), Series 1999 4.625% due 12/01/2004 250 259 Pioneers Memorial Healthcare District, California General Obligation Bonds, (AMBAC Insured), Series 1998 5.125% due 10/01/2024 1,000 999 Port of Oakland, California Revenue Bonds, (FGIC Insured), Series 2000 5.500% due 11/01/2009 500 546 Rancho, California Water District Financing Authority Revenue Bonds, (FGIC Insured), Series 1995 5.875% due 11/01/2010 900 989 Redding, California Electric System Revenue Certificates of Participation, (FGIC Insured), Series 1993 5.684% due 06/28/2019 500 516 Riverside County, California Asset Leasing Corp. Revenue Bonds, (MBIA Insured), Series 2000 5.200% due 11/01/2010 250 273 Sacramento County, California Sanitation District Financing Authority Revenue Bonds, Series 2000-A 4.900% due 12/01/2007 1,000 1,068 5.100% due 12/01/2009 1,000 1,082 5.100% due 12/01/2010 1,000 1,083 Sacramento, California Municipal Utility District Electric Revenue, Series 1993 5.300% due 11/15/2005 2,500 2,649 Sacramento, California Municipal Utility District Revenue Bonds, Series 1983-M 9.000% due 04/01/2013 960 1,287 San Francisco, California City & County Airport Commission International Airport Revenue Bonds, (FGIC Insured), Series 1996-12-A 5.625% due 05/01/2005 400 428 San Francisco, California City & County Airport Commission International Airport Revenue Bonds, (FSA Insured), Series 1998-16A 5.500% due 05/01/2015 300 315 San Francisco, California City & County Airport Commission International Airport Revenue Bonds, (MBIA Insured), Series 1996-14A 8.000% due 05/01/2005 500 578 San Francisco, California City & County Airport Common International Airport Revenue Bonds, Series 1998 4.500% due 05/01/2026 1,750 1,584 San Jose, California Multifamily Housing Revenue Bonds, (LOC-Bay View Bank N.A. & LOC-Federal Home Loan Bank Insured), Series 1999 4.950% due 06/01/2039 1,000 1,046 San Jose, California Redevelopment Agency Tax Allocation, (MBIA Insured), Series 1993 6.000% due 08/01/2010 600 690 San Pablo, California Redevelopment Agency Revenue Bonds, Series 1979 8.000% due 10/01/2011 135 160 Santa Margarita/Dana Point Authority, California Revenue Bonds, (MBIA Insured), Series 1994-A 7.250% due 08/01/2006 150 176 South Tahoe, California Joint Powers Financing Authority Revenue Bonds, Series 1999-A 7.300% due 10/01/2007 150 154 Stockton, California Certificates of Participation, Series 1999 4.750% due 08/01/2006 120 125 West Sacramento California Import Bridge Act 1915, Series 1998 4.800% due 09/02/2002 1,160 1,166 Western Riverside County, California Regional Wastewater Authority Revenue Bonds, (LOC-Dexia Credit Local France), Series 1996 3.600% due 04/01/2028 1,400 1,400 ----------- 88,986 ----------- 42 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Illinois 1.3% Illinois Educational Facilities Authority Revenues, Series 1993 1.000% due 07/01/2012 $ 1,400 $ 1,499 ----------- New Hampshire 2.3% New Hampshire Health & Educational Facilities Authority Revenue Bonds, (AMBAC Insured), Series 2002 5.250% due 07/01/2014 2,690 2,748 ----------- Puerto Rico 17.7% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 5.750% due 07/01/2020 5,000 5,182 ----------- Puerto Rico Commonwealth Aqueduct & Sewer Authority Revenue Bonds, (FSA Surety Bond Insured), Series 1985-A 9.000% due 07/01/2009 3,000 3,497 Puerto Rico Commonwealth General Obligation Bonds, (MBIA Insured), Series 1995 5.200% due 07/01/2006 410 441 Puerto Rico Commonwealth Highway & Transportation Authority Revenue Bonds, Series 1993-X 5.200% due 07/01/2003 500 518 5.350% due 07/01/2005 5,000 5,233 Puerto Rico Commonwealth Infrastructure Financing Authority Revenue Bonds, (AMBAC Insured), Series 1998-A 5.250% due 07/01/2010 150 163 Puerto Rico Electric Power Authority Power Revenue Bonds, Series 1995-X 6.125% due 07/01/2021 500 559 Puerto Rico Industrial Tourist Educational, Medical & Environmental Control Facilities Revenue Bonds, Series 2000 5.300% due 11/15/2005 250 260 Puerto Rico Industrial Tourist Environmental Central Facilities Revenue Bonds, Series 2000 5.300% due 11/15/2004 150 155 Puerto Rico Municipal Finance Agency General Obligation Bonds, (FSA Insured), Series 1999-A 5.000% due 08/01/2004 1,000 1,050 Puerto Rico Public Finance Corp. Revenue Bonds, (AMBAC Insured), Series 1998-A 5.000% due 06/01/2007 500 535 University of Puerto Rico Revenues Bonds, (MBIA Insured), Series 1995 6.250% due 06/01/2006 3,000 3,368 ----------- 20,961 ----------- Virgin Islands 4.0% Virgin Islands Public Finance Authority Revenue Bonds, Series 1998-C 5.500% due 10/01/2008 3,000 3,197 5.500% due 10/01/2007 1,500 1,599 ----------- 4,796 ----------- Total Municipal Bonds & Notes 118,990 (Cost $113,888) ----------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.2% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities 3.625% due 07/15/2002 (b)(c) 219 223 ----------- Total U.S. Treasury Obligations 223 (Cost $219) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 0.2% -------------------------------------------------------------------------------- Money Market Fund 0.2% Reich & Tang California Money Market 2.630% due 04/02/2001 $ 267 $ 267 ----------- Total Short-Term Instruments 267 (Cost $267) ----------- Total Investments (a) 100.8% $ 119,480 (Cost $114,374) Other Assets and Liabilities (Net) (0.8%) (1,016) ----------- Net Assets 100.0% $ 118,464 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $114,374 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 5,137 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (31) ----------- Unrealized appreciation-net $ 5,106 ----------- (b) Securities with an aggregate market value of $223 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts Appreciation -------------------------------------------------------------------------------- U.S. Treasury 30 Year Bond (06/2001) 50 $ 92 ------------ (c) Principal amount of the security is adjusted for inflation. (d) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 43 PIMCO Schedule of Investments A, B, and C Classes California Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 95.6% -------------------------------------------------------------------------------- California 65.3% California Health Facilities Financing Authority Revenue Bonds, Series 1998 3.800% due 09/01/2028 $ 100 $ 100 California Pollution Control Financing Authority Revenue Bonds, Series 1991 3.600% due 10/01/2011 (d) 300 300 California State Department Water Center Revenue Bonds, Series 1993 8.375% due 12/01/2003 150 169 California State General Obligation, Series 2001 5.125% due 03/01/2031 625 621 California Statewide Communities Development Authority Revenue Bonds, Series 2001 5.125% due 10/01/2030 400 395 Capistrano, California Unified School District Community Facilities District Special Tax Bonds, Series 1999 5.700% due 09/01/2020 400 395 Chula Vista, California Special Tax Bonds, Series 2000-1 6.400% due 09/01/2018 125 130 Corona, California Community Facilities District Special Tax Bonds, Series 1998 5.875% due 09/01/2023 150 149 East Bay, California Municipal Utility District Wastewater Treatment System Revenue Bonds, (AMBAC Insured), Series 1993 6.420% due 06/01/2013 (d) 400 435 Foothill Eastern Transportation Corridor Agency Toll Road Revenue Bonds, (MBIA Insured), Series 1999 0.000% due 01/15/2027 500 326 Irvine Ranch California Water District Certificate Participation, (LOC-Toronto Dominio Bank Insured), Series 1986 3.600% due 08/01/2016 (d) 300 300 Livermore-Amador Water Management Agency California Revenue Bonds, (AMBAC Insured), Series 2001 5.000% due 08/01/2031 200 197 Los Angeles County, California Transportation Commission Certificates of Participation, Series 1992-B 6.250% due 07/01/2004 500 527 Los Angeles County, Caliifornia Metropolitan Transportation Authority Sales Tax Revenue Bonds, Series 1999 4.750% due 07/01/2026 500 472 Los Angeles, California Department of Water & Power Waterworks Revenue Bonds, (MBIA Insured), Series 1994 6.375% due 07/01/2034 350 387 Metropolitan Water District Southern California Revenue Bonds, Series 1993 6.370% due 10/30/2020 (d) 200 207 Orange County, California Local Transportation Authority Sales Tax Revenue Bonds, (AMBAC-TCRS Insured), Series 1992 6.200% due 02/14/2011 750 881 Orange County, California Revenue Bonds, (MBIA Insured), Series 1995-A 6.000% due 06/01/2010 400 459 Orange County, California Santa Ana District Certificate Participation, (SPA-DEXIA Public Finance Insured), Series 2000 3.600% due 08/01/2030 (d) 400 400 Pioneers Memorial Healthcare District, California General Obligation Bonds, (AMBAC Insured), Series 1998 5.125% due 10/01/2024 400 400 San Francisco, California City & County Airport Common International Airport Revenue Bonds, Series 1998 4.500% due 05/01/2026 500 453 San Jose, California Redevelopment Agency Tax Allocation, (MBIA Insured), Series 1993 6.000% due 08/01/2010 300 345 Southern California Public Power Authority Revenue Bonds, (FSA-CR Insured), Series 1993 5.000% due 07/01/2015 110 112 Tustin, California Import Bridge Act 1915 Special Assessment, (LOC- KBC Bank Insured), Series 1996 3.600% due 09/02/2013 (d) 100 100 ----------- 8,260 ----------- New Jersey 4.4% New Jersey Economic Development Authority Revenue Bonds, Series 1998 6.375% due 04/01/2031 555 562 ----------- Puerto Rico 22.5% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 5.750% due 07/01/2020 500 518 Puerto Rico Commonwealth Aqueduct & Sewer Authority Revenue Bonds, (FSA Surety Bond Insured), Series 1985-A 9.000% due 07/01/2009 2,000 2,332 ----------- 2,850 ----------- Virgin Islands 3.4% Virgin Islands Public Finance Authority Revenue Bonds, Series 1998-C 5.500% due 10/01/2008 405 432 ----------- Total Municipal Bonds & Notes 12,104 (Cost $11,670) -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.9% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities 3.625% due 07/15/2002 (b)(c) 109 111 ----------- Total U.S. Treasury Obligations 111 (Cost $109) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 0.8% -------------------------------------------------------------------------------- Money Market Fund 0.8% Reich & Tang California Money Market 2.630% due 04/02/2001 105 105 ----------- Total Short-Term Instruments 105 (Cost $105) ----------- Total Investments (a) 97.3% $ 12,320 (Cost $11,884) Other Assets and Liabilities (Net) 2.7% 337 ----------- Net Assets 100.0% $ 12,657 ----------- 44 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $11,883 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 439 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (2) ----------- Unrealized appreciation-net $ 437 ----------- (b) Securities with an aggregate market value of $109 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts (Depreciation) -------------------------------------------------------------------------------- Municipal Bond CBT (06/2001) 9 $ (8) (c) Principal amount of the security is adjusted for inflation. (d) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 45 PIMCO Schedule of Investments A, B, and C Classes Convertible Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES (c)(d) 56.9% -------------------------------------------------------------------------------- Banking & Finance 2.8% Hellenic Finance 2.000% due 07/15/2003 EC 500 $ 440 JMH Finance Ltd. 4.750% due 09/06/2007 $ 1,200 1,226 Swiss Life Finance Ltd. 2.000% due 05/20/2003 EC 600 505 0.750% due 05/20/2005 SF 750 429 ----------- 2,600 ----------- Energy 1.2% Diamond Offshore Drilling 3.750% due 02/15/2007 $ 1,060 1,077 ----------- Health Care 6.3% Millennium Pharmaceuticals 5.500% due 01/15/2007 1,500 1,513 Roche Holdings, Inc. 0.010% due 01/19/2015 3,650 2,665 Wellpoint Health Network, Inc. 0.000% due 07/02/2019 2,000 1,613 ----------- 5,791 ----------- Industrial 23.0% Allergan, Inc. 0.000% due 11/01/2020 2,600 1,619 Burr-Brown Corp. 4.250% due 02/15/2007 1,000 1,110 Celestica, Inc. 0.000% due 08/01/2020 3,500 1,247 Comverse Technology, Inc. 1.500% due 12/01/2005 2,000 1,713 Corning, Inc. 0.000% due 11/08/2015 1,700 1,003 Dupont Photomasks, Inc. 0.000% due 07/24/2004 1,300 1,181 Exodus Communications, Inc. 5.250% due 02/15/2008 2,000 1,320 4.750% due 07/15/2008 2,000 1,073 Omnicom Group, Inc. 2.250% due 01/06/2013 550 960 Sanmina Corp. 4.250% due 05/01/2004 1,200 1,353 Solectron Corp. 0.000% due 01/27/2019 2,625 1,280 0.000% due 05/08/2020 2,500 1,259 Tyco International Ltd. 0.000% due 11/17/2020 3,300 2,446 Universal Health Services 0.426% due 06/23/2020 2,000 1,183 Young & Rubicam, Inc. 3.000% due 01/15/2005 2,500 2,344 ----------- 21,091 ----------- Technology 11.0% Analog Devices, Inc. 4.750% due 10/01/2005 1,700 1,509 ASM Lithography Holding 2.500% due 04/09/2005 NL 1,500 783 Bisys Group, Inc. 4.000% due 03/15/2006 $ 1,250 1,313 Juniper Networks, Inc. 4.750% due 03/15/2007 2,000 1,465 Lattice Semiconductor Co. 4.750% due 11/01/2006 600 662 STMicroelectronics NV 0.010% due 09/22/2009 900 960 U.S. Cellular Corp. 0.010% due 06/15/2015 3,350 1,968 VERITAS Software Corp. 1.856% due 08/13/2006 1,000 1,441 ----------- 10,101 ----------- Utilities 12.6% AES Corp. 4.500% due 08/15/2005 750 1,407 Alliant Energy Resources, Inc. 7.250% due 02/15/2030 33 1,541 AT&T - Liberty Media Group 4.000% due 11/15/2029 2,200 1,436 3.500% due 01/15/2031 1,500 1,127 Cienna Corp. 3.750% due 02/01/2008 2,000 1,563 Comcast Corp. 0.000% due 12/19/2020 1,000 820 Kerr-McGee Corp. 5.250% due 02/15/2010 1,000 1,235 Nabors Industries, Inc. 0.000% due 02/05/2021 2,000 1,156 Nextel Communications, Inc. 5.250% due 01/15/2010 2,000 1,293 ----------- 11,578 ----------- Total Convertible Bonds & Notes 52,238 (Cost $61,854) ----------- -------------------------------------------------------------------------------- CONVERTIBLE PREFERRED STOCK 34.6% -------------------------------------------------------------------------------- Shares Banking & Finance 4.7% Metlife Capital Trust I Cvt. Pfd. 8.000% due 05/15/2003 41,000 3,875 Union Pacific Capital Trust Cvt. Pfd. 6.250% due 04/21/2028 9,200 453 ----------- 4,328 ----------- Energy 12.8% Apache Corp. Cvt. Pfd. 6.500% due 05/15/2002 37,000 1,796 Kerr-McGee Corp. Cvt. Pfd. 5.500% due 08/01/2004 58,900 3,156 Mirant Trust I Cvt. Pfd. 6.250% due 10/01/2030 50,000 3,725 Valero Energy Cvt. Pfd. 7.750% due 08/18/2003 100,500 3,035 ----------- 11,712 ----------- Industrial 10.6% Cox Communications, Inc. Cvt. Pfd. 7.000% due 08/16/2002 46,000 2,736 Express Scripts Exchange Trust Cvt. Pfd. 7.000% due 11/15/2003 26,000 2,053 Qwest Trends Trust Cvt. Pfd. 5.750% due 11/17/2003 25,000 1,534 Tribune Co. Cvt. Pfd. 2.000% due 05/15/2029 35,100 3,405 ----------- 9,728 ----------- Utilities 6.5% AES Trust VII Cvt. Pfd. 6.000% due 05/15/2008 24,400 1,565 Duke Energy Corp. Cvt. Pfd. 8.250% due 05/18/2004 100,000 2,724 Enron Corp. Cvt. Pfd. 7.000% due 07/31/2002 28,000 1,026 MediaOne Group, Inc. Cvt. Pfd. 6.250% due 08/15/2001 9,500 625 5,940 ----------- Total Convertible Preferred Stock 31,708 (Cost $28,836) ----------- 46 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Value Shares (000s) -------------------------------------------------------------------------------- COMMON STOCKS 2.7% -------------------------------------------------------------------------------- Communications 0.0% Leap Wireless International,Inc. (b) 344 $ 10 ----------- Health Care 0.6% Elan Corp. PLC (b) 10,114 528 ----------- Technology 2.1% AOL Time Warner, Inc. (b) 2,100 84 EMC Corp. (b) 60,668 1,784 McData Corp. `A' (b) 2,233 42 ----------- 1,910 ----------- Total Common Stocks 2,448 (Cost $3,994) ----------- Total Investments (a) 94.2% $ 86,394 (Cost $94,684) Other Assets and Liabilities (Net) 5.8% 5,296 ----------- Net Assets 100.0% $ 91,690 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $94,699 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 6,705 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (15,010) ----------- Unrealized appreciation-net $ (8,305) ----------- (b) Non-income producing security. (c) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy EC 2,111 04/2001 $ (7) Sell 2,111 04/2001 111 Sell 2,111 06/2001 7 Buy JY 148,448 04/2001 (30) Sell 93,323 04/2001 41 Sell 93,323 06/2001 18 Sell SF 772 05/2001 4 ------------- $ 144 ------------- (d) Principal amount denoted in indicated currency: EC - Euro JY - Japanese Yen NL - Netherlands Guilder SF - Swiss Franc See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 47 PIMCO Schedule of Investments A, B, and C Classes Emerging Markets Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- BERMUDA 0.1% -------------------------------------------------------------------------------- IMEXA Export Trust 10.125% due 05/31/2003 $ 102 $ 91 ----------- Total Bermuda 91 (Cost $92) ----------- -------------------------------------------------------------------------------- BRAZIL 29.1% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (b) $ 1,795 1,627 7.687% due 04/15/2009 (b) 250 210 14.500% due 10/15/2009 2,500 2,702 8.000% due 04/15/2014 4,631 3,586 6.000% due 04/15/2024 750 516 7.625% due 04/15/2024 (b) 1,100 833 8.875% due 04/15/2024 3,350 2,278 10.125% due 05/15/2027 500 382 12.250% due 03/06/2030 2,600 2,295 11.000% due 08/17/2040 2,950 2,340 ----------- Total Brazil 16,769 (Cost $17,232) ----------- -------------------------------------------------------------------------------- BULGARIA 1.0% -------------------------------------------------------------------------------- Republic of Bulgaria 6.312% due 07/28/2011 (b) $ 250 188 6.312% due 07/28/2024 (b) 500 373 ----------- Total Bulgaria 561 (Cost $604) ----------- -------------------------------------------------------------------------------- CROATIA 4.2% -------------------------------------------------------------------------------- Republic of Croatia 6.250% due 07/31/2006 (b) $ 1,456 1,423 6.250% due 07/31/2010 (b) 993 971 ----------- Total Croatia 2,394 (Cost $2,384) ----------- -------------------------------------------------------------------------------- MALAYSIA 2.6% -------------------------------------------------------------------------------- Republic of Malaysia 6.875% due 05/15/2001 $ 1,500 1,522 ----------- Total Malaysia 1,522 (Cost $1,499) ----------- -------------------------------------------------------------------------------- MEXICO 20.1% -------------------------------------------------------------------------------- United Mexican States 0.000% due 06/30/2003 $ 9,459 118 10.375% due 02/17/2009 250 275 9.875% due 02/01/2010 1,000 1,076 11.375% due 09/15/2016 250 289 8.125% due 12/30/2019 3,250 2,919 6.250% due 12/31/2019 4,075 3,683 7.412% due 12/31/2019 (b) 1,025 1,003 7.515% due 12/31/2019 400 391 7.532% due 12/31/2019 1,150 1,125 11.500% due 05/15/2026 575 696 ----------- Total Mexico 11,575 (Cost $11,291) ----------- -------------------------------------------------------------------------------- MOROCCO 1.0% -------------------------------------------------------------------------------- Moroco Restructured Tranche A 7.652% due 01/01/2009 $ 658 584 ----------- Total Morocco 584 (Cost $593) ----------- -------------------------------------------------------------------------------- NIGERIA 0.8% -------------------------------------------------------------------------------- Central Bank of Nigeria 6.250% due 11/15/2020 $ 750 469 Central Bank of Nigeria - Warrant 0.000% due 11/15/2020 1 0 ----------- Total Nigeria 469 (Cost $430) ----------- -------------------------------------------------------------------------------- PANAMA 4.7% -------------------------------------------------------------------------------- Republic of Panama 7.875% due 02/13/2002 $ 50 $ 50 7.733% due 05/14/2002 69 70 9.625% due 02/08/2011 600 596 4.500% due 07/17/2014 1,375 1,148 8.875% due 09/30/2027 500 439 9.375% due 04/01/2029 400 403 ----------- Total Panama 2,706 (Cost $2,637) ----------- -------------------------------------------------------------------------------- PERU 2.6% -------------------------------------------------------------------------------- Republic of Peru 4.000% due 03/07/2017 $ 2,100 1,313 4.500% due 03/07/2017 250 170 ----------- Total Peru 1,483 (Cost $1,473) ----------- -------------------------------------------------------------------------------- PHILIPPINES 0.7% -------------------------------------------------------------------------------- Republic of Philippines 6.500% due 12/01/2017 $ 500 405 ----------- Total Philippines 405 (Cost $392) ----------- -------------------------------------------------------------------------------- POLAND 4.1% -------------------------------------------------------------------------------- Republic of Poland 6.000% due 10/27/2014 $ 1,315 1,281 3.750% due 10/27/2024 1,450 1,058 ----------- Total Poland 2,339 (Cost $2,226) ----------- -------------------------------------------------------------------------------- QATAR 2.1% -------------------------------------------------------------------------------- State of Qatar 9.750% due 06/15/2030 $ 1,125 1,198 ----------- Total Qatar 1,198 (Cost $1,084) ----------- -------------------------------------------------------------------------------- RUSSIA 13.4% -------------------------------------------------------------------------------- Russian Federation 9.250% due 11/27/2001 $ 1,250 1,257 11.750% due 06/10/2003 2,900 2,834 8.750% due 07/24/2005 700 575 8.250% due 03/31/2010 353 238 11.000% due 07/24/2018 650 486 12.750% due 06/24/2028 1,850 1,622 5.000% due 03/31/2030 647 262 5.000% due 03/31/2030 1,004 411 ----------- Total Russia 7,685 (Cost $7,213) ----------- -------------------------------------------------------------------------------- SOUTH AFRICA 0.9% -------------------------------------------------------------------------------- Republic of South Africa 9.125% due 05/19/2009 $ 500 522 ----------- Total South Africa 522 (Cost $514) ----------- -------------------------------------------------------------------------------- SOUTH KOREA 3.0% -------------------------------------------------------------------------------- Korea Development Bank 7.125% due 09/17/2001 $ 500 503 Republic of Korea 8.875% due 04/15/2008 1,100 1,221 ----------- Total South Korea 1,724 (Cost $1,641) ----------- 48 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- VENEZUELA 5.9% -------------------------------------------------------------------------------- Republic of Venezuela 7.375% due 12/18/2007 (b) $ 1,500 $ 1,255 6.750% due 03/31/2020 1,475 1,136 9.250% due 09/15/2027 1,430 993 Republic of Venezuela - Warrant 0.000% due 04/15/2020 6 0 ----------- Total Venezuela 3,384 (Cost $3,371) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 5.1% -------------------------------------------------------------------------------- Commercial Paper 5.1% Abbey National North America 5.090% due 04/19/2001 100 100 4.870% due 05/02/2001 1,000 996 American Express Credit Corp. 5.100% due 04/06/2001 200 200 General Electric Capital Corp. 4.970% due 04/04/2001 200 200 UBS Finance, Inc. 5.340% due 05/16/2001 300 298 5.040% due 08/02/2001 600 590 5.070% due 08/08/2001 300 294 Verizon Global Funding 4.950% due 06/15/2001 300 297 ----------- Total Short-Term Instruments 2,975 (Cost $2,975) ----------- Total Investments (a) 101.4% $ 58,386 (Cost $57,651) Other Assets and Liabilities (Net) (1.4%) (788) ----------- Net Assets 100.0% $ 57,598 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $58,137 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 1,278 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (1,029) ----------- Unrealized appreciation-net $ 249 ----------- (b) Variable rate security. The rate listed is as of March 31, 2001. (c) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy HF 909,150 05/2001 $ (75) Sell 550,000 05/2001 127 Buy 158,130 08/2001 (26) Buy 48,055 09/2001 (8) Buy PZ 750 05/2001 27 -------------- $ 45 -------------- (d) Principal amount denoted in indicated currency: HF - Hungarian Forint PZ - Polish Zloty See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 49 PIMCO Schedule of Investments A, B, and C Classes Foreign Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- AUSTRALIA (e)(f) 2.2% -------------------------------------------------------------------------------- General Electric Capital Australia Funding 6.750% due 09/15/2007 A$ 750 $ 390 General Motors Acceptance Corp. 4.849% due 03/25/2002 (d) EC 10,300 9,038 Registered Australian Mortgage Securities 5.138% due 09/26/2032 (d) 2,840 2,498 Torrens Trust 5.424% due 07/15/2031 (d) $ 2,776 2,776 ----------- Total Australia 14,702 (Cost $15,826) ----------- -------------------------------------------------------------------------------- AUSTRIA (e)(f) 0.2% -------------------------------------------------------------------------------- Republic of Austria 5.500% due 01/15/2010 (i) EC 1,200 1,093 ----------- Total Austria 1,093 (Cost $1,041) ----------- -------------------------------------------------------------------------------- BELGIUM (e)(f) 2.4% -------------------------------------------------------------------------------- Kingdom of Belgium 9.000% due 03/28/2003 EC 5 5 5.100% due 11/21/2004 (d) BF 183,200 4,290 7.500% due 07/29/2008 (i) EC 10,500 10,669 5.000% due 09/28/2011 (i) 1,700 1,485 ----------- Total Belgium 16,449 (Cost $18,926) ----------- -------------------------------------------------------------------------------- BRAZIL (e)(f) 0.9% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (d) $ 7,040 6,380 ----------- Total Brazil 6,380 (Cost $6,570) ----------- -------------------------------------------------------------------------------- CANADA (e)(f) 9.2% -------------------------------------------------------------------------------- Beneficial Canada, Inc. 6.350% due 04/01/2002 C$ 3,440 2,211 Commonwealth of Canada 5.250% due 09/01/2003 640 410 6.000% due 09/01/2005 (i) 52,500 34,482 7.250% due 06/01/2007 (i) 34,500 24,151 5.500% due 06/01/2010 1,800 1,149 ----------- Total Canada 62,403 (Cost $63,801) ----------- -------------------------------------------------------------------------------- CAYMAN ISLANDS (e)(f) 1.2% -------------------------------------------------------------------------------- Capital Credit Card Corp. Ltd. 5.625% due 10/15/2004 DM 2,800 1,262 International Credit Receivable Japan 0.746% due 08/25/2005 JY 50,000 398 5.602% due 03/15/2010 1,800 1,585 MBNA American Euro 4.887% due 05/19/2004 (d) EC 8,100 7,116 ----------- Total Cayman Islands 10,361 (Cost $12,305) ----------- -------------------------------------------------------------------------------- DENMARK (e)(f) 1.7% -------------------------------------------------------------------------------- Lb Rheinland - PFALZ 4.750% due 04/04/2008 EC 5,330 4,633 Nykredit 6.000% due 10/01/2009 DK 29,895 3,415 Unikredit Realkredit 6.000% due 07/01/2029 27,036 3,098 ----------- Total Denmark 11,146 (Cost $10,934) ----------- -------------------------------------------------------------------------------- FRANCE (e)(f) 10.2% -------------------------------------------------------------------------------- Axa 2.500% due 01/01/2014 EC 835 $ 729 Republic of France 5.500% due 04/25/2007 (i) 7,890 7,320 4.000% due 04/25/2009 (i) 8,250 6,924 3.000% due 07/25/2009 3,115 2,656 4.000% due 10/25/2009 (i) 46,070 38,104 5.500% due 04/25/2010 13,960 12,913 ----------- Total France 68,646 (Cost $70,890) ----------- -------------------------------------------------------------------------------- GERMANY (e)(f) 18.4% -------------------------------------------------------------------------------- Commerzbank AG 5.206% due 10/25/2032 (d) EC 6,200 5,470 Depfa Pfandbriefbank 4.750% due 07/15/2008 3,590 3,106 5.750% due 03/04/2009 (i) 3,560 3,270 DT Hypothekenbank 3.500% due 07/03/2006 7,000 5,798 Hypothekenbank in Essen AG 5.500% due 02/20/2007 1,690 1,620 Landesbank Baden-Wuerttemberg AG 5.500% due 04/02/2007 3,240 2,943 Republic of Germany 6.000% due 07/04/2007 (i) 26,200 24,913 5.250% due 01/04/2008 (i) 35,730 32,802 4.125% due 07/04/2008 (i) 21,500 18,375 4.500% due 07/04/2009 (i) 19,100 16,618 5.375% due 01/04/2010 (i) 1,750 1,615 6.250% due 01/04/2024 (i) 1,880 1,841 6.250% due 01/04/2030 (i) 1,700 1,688 Rheinische Hypothekenbank AG 4.250% due 09/24/2008 3,310 2,763 WestDeutsche Landersbank 4.750% due 09/28/2007 1,630 1,421 ----------- Total Germany 124,243 (Cost $123,367) ----------- -------------------------------------------------------------------------------- GREECE (e)(f) 0.4% -------------------------------------------------------------------------------- Hellenic Finance 2.000% due 07/15/2003 EC 1,600 1,409 Hellenic Republic 7.850% due 05/19/2003 (d) GD 293 266 7.890% due 06/17/2003 (d) 315 287 7.080% due 10/23/2003 (d) 1,103 1,018 ----------- Total Greece 2,980 (Cost $3,926) ----------- -------------------------------------------------------------------------------- ITALY (e)(f) 14.5% -------------------------------------------------------------------------------- Finmeccanica SpA 2.000% due 06/08/2005 EC 544 461 First Italian Auto Transaction 5.139% due 07/01/2008 (d) 7,230 6,363 Island Finance 5.404% due 03/30/2015 (d) 2,684 2,372 Republic of Italy 5.750% due 09/15/2002 (i) 26,400 23,681 7.750% due 11/01/2006 (i) 5,700 5,738 4.500% due 05/01/2009 (i) 64,110 54,593 4.250% due 11/01/2009 (i) 5,560 4,639 ----------- Total Italy 97,847 (Cost $100,861) ----------- 50 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- JAPAN (e)(f) 1.7% -------------------------------------------------------------------------------- Government of Japan 0.900% due 12/22/2008 (d)(i) JY 907,400 $ 7,180 International Credit Receivable Japan 1 Tranche A 0.863% due 08/25/2005 132,610 1,056 SHL Corp. Ltd. 1.031% due 12/25/2024 (d) 76,618 610 1.331% due 12/25/2024 (d) 76,000 605 ----------- Total Japan 9,451 (Cost $10,447) ----------- -------------------------------------------------------------------------------- MEXICO (e)(f) 0.9% -------------------------------------------------------------------------------- Petroleos Mexicanos 8.850% due 09/15/2007 $ 1,040 1,070 9.375% due 12/02/2008 1,290 1,345 United Mexican States 8.750% due 05/30/2002 BP 960 1,385 10.375% due 01/29/2003 DM 2,575 1,233 4.000% due 03/11/2004 JY 130,000 1,062 ----------- Total Mexico 6,095 (Cost $6,454) ----------- -------------------------------------------------------------------------------- NETHERLANDS (e)(f) 0.6% -------------------------------------------------------------------------------- Unilever NV 4.830% due 09/17/2001 (d) EC 4,800 4,204 ----------- Total Netherlands 4,204 (Cost $4,096) ----------- -------------------------------------------------------------------------------- NEW ZEALAND (e)(f) 0.9% -------------------------------------------------------------------------------- Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 13,430 5,951 ----------- Total New Zealand 5,951 (Cost $7,504) ----------- -------------------------------------------------------------------------------- PERU (e)(f) 0.3% -------------------------------------------------------------------------------- Republic of Peru 4.500% due 03/07/2017 (d) $ 2,700 1,843 ----------- Total Peru 1,843 (Cost $1,867) ----------- -------------------------------------------------------------------------------- SOUTH KOREA (e)(f) 2.7% -------------------------------------------------------------------------------- Export-Import Bank Korea 7.250% due 06/25/2001 $ 1,945 1,950 6.500% due 02/10/2002 (d) 800 801 KBC Bank Fund Trust IV 8.220% due 11/29/2049 EC 2,800 2,591 Korea Development Bank 4.885% due 05/14/2001 DM 7,310 3,286 2.770% due 05/21/2001 JY 500,000 3,995 2.450% due 09/10/2001 231,000 1,848 1.875% due 02/13/2002 466,000 3,726 ----------- Total South Korea 18,197 (Cost $19,514) ----------- -------------------------------------------------------------------------------- SPAIN (e)(f) 3.8% -------------------------------------------------------------------------------- Kingdom of Spain 5.150% due 07/30/2009 (i) EC 28,430 25,459 ----------- Total Spain 25,459 (Cost $28,157) ----------- -------------------------------------------------------------------------------- SUPRANATIONAL (e)(f) 1.3% -------------------------------------------------------------------------------- Eurofima 4.750% due 07/07/2004 (i) SK 60,900 5,885 International Bank for Reconstruction & Development 7.250% due 04/09/2001 N$ 6,400 2,581 ----------- Total Supranational 8,466 (Cost $10,093) ----------- -------------------------------------------------------------------------------- SWEDEN (e)(f) 0.7% -------------------------------------------------------------------------------- Kingdom of Sweden 13.000% due 06/15/2001 SK 11,200 $ 1,097 5.000% due 01/28/2009 37,800 3,746 ----------- Total Sweden 4,843 (Cost $5,233) ----------- -------------------------------------------------------------------------------- UNITED KINGDOM (e)(f) 7.5% -------------------------------------------------------------------------------- Abbey National Treasury Service PLC 5.250% due 01/21/2004 BP 2,670 3,766 British Telecommunications PLC 6.079% due 12/15/2003 (d) $ 5,180 5,182 Core 5.138% due 03/17/2009 (d) 3,360 3,339 Halifax Group Euro Finance 7.627% due 12/29/2049 EC 1,040 965 Haus Ltd. 5.124% due 12/10/2037 (d) 8,500 7,481 Holmes Financing PLC 5.859% due 07/15/2017 (d) 5,540 5,541 Lloyds TSB Capital 7.375% due 02/07/2049 BP 500 462 SCCR Series 1 Ltd. 5.373% due12/15/2031 (d) 1,414 1,247 United Kingdom Gilt 7.500% due 12/07/2006 (i) 4,800 7,678 7.250% due 12/07/2007 (i) 4,800 7,712 5.750% due 12/07/2009 (i) 4,690 7,078 ----------- Total United Kingdom 50,451 (Cost $52,225) ----------- -------------------------------------------------------------------------------- UNITED STATES (e)(f) 62.4% -------------------------------------------------------------------------------- Asset-Backed Securities 10.4% Advanta Mortgage Loan Trust 5.383% due 07/25/2026 (d) $ 227 227 AFC Home Equity Loan Trust 5.270% due 03/25/2027 (d) 681 681 5.350% due 07/25/2030 (d) 7,283 7,296 Americredit Automobile Receivable Trust 5.880% due 12/05/2003 161 162 Amresco Residential Securities Mortgage Loan Trust 6.000% due 06/25/2029 (d) 4,603 4,621 Banc One Auto Grantor Trust 6.270% due 11/20/2003 162 163 6.290% due 07/20/2004 321 323 Bayview Financial Acquisition Trust 7.170% due 02/25/2029 (d) 308 309 5.920% due 11/25/2030 (d) 5,100 5,100 Chase Manhattan Grantor Trust 6.610% due 09/15/2002 54 54 Conseco Finance 5.534% due 10/15/2031 (d) 1,176 1,181 CS First Boston Mortgage Securities Corp. 5.424% due 12/15/2030 (d) 5,859 5,865 Delta Funding Home Equity Loan Trust 7.380% due 12/15/2017 398 402 EQCC Home Equity Loan Trust 5.770% due 05/20/2010 757 756 5.484% due 03/20/2030 330 330 First Alliance Mortgage Loan Trust 5.238% due 12/20/2027 (d) 190 190 Green Tree Floorplan Receivables Master Trust 5.921% due 11/15/2004 (d) 2,500 2,501 Nissan Auto Receivables Grantor Trust 5.450% due 04/15/2004 1,108 1,112 Provident Bank Equipment Lease Trust 5.830% due 11/25/2011 (d) 1,732 1,732 Providian Gateway Master Trust 5.380% due 03/15/2007 5,800 5,800 Providian Home Equity Loan Trust 5.340% due 06/25/2025 (d) 3,342 3,346 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 51 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Foreign Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- PSB Lending Home Loan Owner Trust 6.830% due 05/20/2018 $ 339 $ 342 Residential Asset Securities Corp. 5.770% due 01/25/2032 (d) 10,416 10,429 Residential Funding Mortgage Securities, Inc. 10.836% due 06/01/2001 11,100 11,100 Salomon Brothers Mortgage Securities VII 5.310% due 02/25/2031 (d) 5,734 5,734 USAA Auto Loan Grantor Trust 5.800% due 01/15/2005 478 482 ----------- 70,238 ----------- Corporate Bonds & Notes 12.6% Abbey National Capital Trust I 8.963% due 12/29/2049 2,000 2,218 Allegheny Energy Supply 6.325% due 05/01/2002 (d) 2,900 2,902 Alpha Wind 11.321% due 05/23/2001 (d) 2,000 2,000 Associates First Capital Corp. 5.810% due 01/25/2031 (d) 5,391 5,391 AT&T Capital Corp. 5.881% due 04/23/2002 (d) 675 677 Bancomext Trust Division 8.000% due 08/05/2003 390 397 Bear Stearns Co., Inc. 5.210% due 03/28/2003 (d) 2,670 2,669 Beckman Instruments, Inc. 7.100% due 03/04/2003 344 347 Capital One Bank 6.308% due 07/28/2003 (d) 12,000 11,797 CMS Energy Corp. 8.125% due 05/15/2002 546 553 DaimlerChrysler North America Holding Corp. 5.640% due 08/23/2002 (d) 3,900 3,868 DQE Capital Corp. 6.179% due 01/15/2002 (d) 800 800 Finova Capital Corp. 5.193% due 06/18/2003 (d)(j) 5,700 4,674 Ford Motor Credit Co. 1.000% due 12/22/2003 JY 107,000 854 6.089% due 07/19/2004 (d) $ 2,800 2,781 1.200% due 02/07/2005 JY 619,000 4,925 General Motors Acceptance Corp. 1.250% due 12/20/2004 208,000 1,665 Gold Eagle Capital Ltd. 11.079% due 04/15/2001 (d) $ 2,500 2,500 International Game Technology 7.875% due 05/15/2004 1,700 1,726 J.P. Morgan & Co., Inc. 6.655% due 02/15/2012 (d) 4,670 4,264 Jones Intercable, Inc. 8.875% due 04/01/2007 427 458 MGM Grand, Inc. 6.950% due 02/01/2005 180 180 NeHi, Inc. 11.379% due 06/09/2003 (d) 2,000 2,020 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(j) 2,700 2,228 Protective Life Funding Trust 6.089% due 01/17/2003 (d) 1,200 1,202 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (h) 13,375 13,449 5.629% due 02/11/2003 (d) 400 401 Sprint Capital Corp. 5.875% due 05/01/2004 690 678 Texas Utilities Corp. 7.389% due 09/24/2001 (d) 2,600 2,592 Texas Utilities Electric Co. 5.650% due 12/20/2002 (d) 1,500 1,501 WorldCom, Inc. 7.375% due 01/15/2003 (d) 3,100 3,136 ----------- 84,853 ----------- Mortgage-Backed Securities 22.5% Bank of America Mortgage Securities, Inc. 6.500% due 05/25/2029 291 286 Bear Stearns Adjustable Rate Mortgage Trust 6.944% due 02/25/2031 (d) 4,569 4,614 Chase Mortgage Finance Corp. 6.550% due 08/25/2028 1,906 1,924 Citicorp Mortgage Securities, Inc. 6.500% due 07/25/2028 1,766 1,775 6.500% due 03/25/2029 140 136 Crusade Global Trust 5.719% due 05/15/2021 (d) 13,119 13,152 Fannie Mae 8.495% due 07/01/2021 (d) 612 630 7.764% due 11/01/2022 (d) 800 827 7.583% due 01/01/2023 (d) 1,130 1,166 8.210% due 08/01/2023 (d) 921 947 Freddie Mac 6.000% due 03/15/2008 620 621 9.050% due 06/15/2019 51 54 8.266% due 06/01/2022 (d) 1,051 1,059 8.393% due 08/01/2022 (d) 607 622 General Electric Capital Mortgage Services, Inc. 6.250% due 07/25/2029 500 506 Government National Mortgage Association 7.625% due 11/20/2021 (d) 477 489 7.375% due 05/20/2022 (d) 45 46 7.750% due 07/20/2022 (d) 499 511 7.750% due 09/20/2022 (d) 314 322 7.375% due 05/20/2023 (d) 493 502 7.750% due 07/20/2023 (d) 533 545 7.750% due 07/20/2023 (d) 252 258 7.750% due 08/20/2023 (d) 238 244 7.750% due 09/20/2023 (d) 1,392 1,426 7.750% due 09/20/2023 (d) 621 636 7.125% due 10/20/2023 (d) 2,594 2,660 7.625% due 10/20/2024 (d) 212 217 7.375% due 04/20/2025 (d) 154 157 7.750% due 07/20/2025 (d) 3,312 3,391 7.750% due 09/20/2025 (d) 644 660 7.625% due 12/20/2025 (d) 250 257 7.750% due 09/20/2026 (d) 514 526 7.375% due 04/20/2027 (d) 1,271 1,290 6.000% due 04/15/2028-05/20/2030 (d)(g) 118,980 59,219 7.000% due 04/20/2030-05/20/2030 (d)(g) 10,384 5,840 6.500% due 04/23/2031 (d) 4,260 4,259 7.500% due 04/23/2031 12,600 12,915 Homeside Mortgage Securities Trust 5.929% due 01/20/2027 (d) 2,900 2,900 Medallion Trust 5.880% due 07/12/2031 (d) 4,844 4,846 Prudential Home Mortgage Securities 6.800% due 05/25/2024 480 464 Residential Funding Mortgage Securities, Inc. 6.500% due 05/25/2029 1,311 1,195 5.779% due 05/12/2032 (d) 12,805 12,821 Sasco Floating Rate Commercial Mortgage Trust 5.408% due 11/20/2001 (d) 1,900 1,901 Structured Asset Mortgage Investments, Inc. 6.581% due 06/25/2029 (d) 2,938 2,984 ----------- 151,800 ----------- Municipal Bonds & Notes 0.1% Massachusetts State Turnpike Authority Metro Highway System Revenue Bonds, (MBIA Insured), Series 1999 5.000% due 01/01/2037 1,000 941 ----------- Shares Preferred Security 1.0% DG Funding Trust 7.150% due 12/29/2049 (d) 640 6,528 ----------- 52 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- U.S. Government Agencies 2.7% Federal Home Loan Bank 5.805% due 02/15/2002 (d) $ 14,000 $ 14,066 Small Business Administration 6.640% due 02/10/2011 4,400 4,428 ----------- 18,494 ----------- U.S. Treasury Obligations 13.1% Treasury Inflation Protected Securities (h) 3.625% due 07/15/2002 (b)(i) 79,211 80,771 3.875% due 01/15/2009 2,348 2,442 3.625% due 04/15/2028 4,762 4,855 3.875% due 04/15/2029 213 228 ----------- 88,296 ----------- Total United States 421,150 (Cost $419,115) ----------- -------------------------------------------------------------------------------- PURCHASED CALL OPTION 0.0% -------------------------------------------------------------------------------- U.S. Treasury Bond (OTC) 5.500% due 02/15/2008 Strike @ 113.250 Exp. 06/01/2001 25,000 0 U.S. Treasury Note (OTC) 5.500% due 02/15/2008 Strike @ 112.19 Exp. 07/02/2001 215,000 15 U.S. Treasury Note Futures (CBOT) 6.000% due 06/30/2001 Strike @ 119.000 Exp. 05/26/2001 400 6 ----------- Total Purchased Call Options 21 (Cost $46) ----------- -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Republic of Germany (OTC) 4.500% due 07/04/2009 Strike @ 90.281 Exp. 05/02/2001 17,000 0 Republic of Germany (OTC) 5.250% due 01/04/2008 Strike @ 96.281 Exp. 05/02/2001 29,000 0 Republic of Germany (OTC) 5.250% due 01/04/2008 Strike @ 98.400 Exp. 05/02/2001 21,000 0 Republic of Germany (OTC) 5.250% due 01/04/2011 Strike @ 95.300 Exp. 05/02/2001 15,000 0 Republic of Germany (OTC) 6.000% due 07/04/2007 Strike @ 101.031 Exp. 05/02/2001 27,000 0 Republic of France (OTC) 4.000% due 10/25/2009 Strike @ 86.500 Exp. 05/02/2001 42,000 0 Government National Mortgage Association (OTC) 6.000% due 05/21/2031 Strike @ 90.281 Exp. 05/04/2001 145,000 0 Government National Mortgage Association (OTC) 7.500% due 05/21/2031 Strike @ 96.641 Exp. 05/04/2001 13,000 0 Interest Rate Swap (OTC) 7.500% due 05/01/2023 Strike @ 7.500 Exp. 04/29/2002 11,200 16 Japanese Government Bond (OTC) 10.800% due 06/20/2008 Strike @ 97.750 Exp. 05/02/2001 14,700,000 1 ----------- Total Purchased Put Options 17 (Cost $462) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 10.1% -------------------------------------------------------------------------------- Commercial Paper 9.2% Abbey National North America 5.040% due 08/06/2001 $ 7,000 $ 6,881 American Express Co. 5.320% due 04/04/2001 100 100 Becton Dickinson & Co. 4.800% due 07/25/2001 2,000 1,969 Coca-Cola Co. 4.600% due 07/12/2001 7,500 7,396 General Electric Capital Corp. 4.990% due 04/03/2001 1,800 1,800 4.980% due 04/25/2001 2,500 2,492 4.870% due 05/30/2001 10,000 9,918 4.600% due 07/18/2001 10,000 9,853 National Rural Utilities Cooperative Finance Corp. 4.880% due 05/25/2001 1,000 993 Reseau Ferre De France 4.590% due 07/25/2001 7,500 7,383 Swedbank, Inc. 5.150% due 04/25/2001 2,000 1,993 5.090% due 08/08/2001 4,000 3,931 UBS Finance, Inc. 5.340% due 04/04/2001 600 600 5.040% due 08/02/2001-08/15/2001 (g) 12,600 6,683 Verizon Global Funding 5.340% due 04/05/2001 300 300 ----------- 62,292 ----------- Repurchase Agreement 0.8% State Street Bank 4.600% due 04/02/2001 5,365 5,365 (Dated 03/30/2001. Collateralized by Freddie Mac ----------- 7.000% due 03/15/2010 valued at $5,476. Repurchase proceeds are $5,367.) U.S. Treasury Bills 0.1% 4.600% due 05/17/2001 (b) 585 581 ----------- Total Short-Term Instruments 68,238 Cost $68,255) ----------- Total Investments (a) 154.2% $ 1,040,636 (Cost $1,061,915) Written Options (c) (0.3%) (2,046) (Premiums $696) Other Assets and Liabilities (Net) (53.9%) (363,749) ----------- Net Assets 100.0% $ 674,841 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,062,222 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 8,890 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (30,477) ----------- Unrealized depreciation-net $ (21,586) ----------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 53 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Foreign Bond Fund March 31, 2001 -------------------------------------------------------------------------------- (b) Securities with an aggregate market value of $7,367 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 10 Year Note (06/2001) 2,127 $ (502) EuroBond 10 Year Note (06/2001) 199 183 Government of Japan 10 Year Note (06/2001) 162 174 UK GILT LIF (06/2001) 15 (9) -------------- $ (154) -------------- (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - CME Eurodollar December Futures Strike @ 95.00 Exp. 12/17/2001 34 $ 14 $ 10 Call - CBOT U.S. Treasury Note June Futures Strike @ 107.00 Exp. 05/26/2001 35 22 30 Put - CME Eurodollar December Futures Strike @ 95.25 Exp. 12/17/2001 206 103 113 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 243 133 133 Put - OTC 3 Month LIBOR Interest Rate Swap Strike @ 7.50 Exp. 04/29/2002 16,000,000 362 1,689 Put - CBOT U.S. Treasury Note June Futures Strike @ 105.00 Exp. 05/26/2001 125 62 71 --------------------------- $ 696 $ 2,046 --------------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy A$ 1,600 04/2001 $ (106) Sell 2,584 04/2001 79 Buy C$ 5,813 04/2001 (32) Sell 11,560 04/2001 145 Sell SF 43,161 05/2001 208 Buy CP 349,600 04/2001 (26) Sell 349,600 04/2001 18 Sell DK 54,194 05/2001 344 Buy EC 161,227 04/2001 (1,425) Sell 146,971 04/2001 7,780 Sell 135,290 06/2001 510 Sell BP 10,726 05/2001 522 Sell H$ 121,000 05/2001 40 Buy 111,900 08/2001 (49) Sell 223,800 08/2001 172 Buy HF 341,600 08/2001 (29) Buy JY 5,209,915 04/2001 (1,027) Sell 5,209,915 04/2001 2,255 Sell 5,960,790 06/2001 1,136 Buy KW 1,262,100 04/2001 (159) Sell 1,262,100 04/2001 38 Sell N$ 21,385 04/2001 370 Buy PZ 28,050 04/2001 1,181 Sell 28,050 04/2001 (245) Sell SK 57,435 05/2001 361 Buy TB 28,140 04/2001 (23) Sell 28,140 04/2001 28 Buy TD 21,403 04/2001 (7) Sell 21,403 04/2001 (2) -------------- $ 12,057 -------------- (f) Principal amount denoted in indicated currency: A$ - Australian Dollar BF - Belgian Franc BP - British Pound C$ - Canadian Dollar CP - Chilean Peso DK - Danish Krone DM - Germany Mark EC - Euro GD - Greek Drachma H$ - Hong Kong Dollar HF - Hungarian Forint JY - Japanese Yen KW - Korean Won N$ - New Zealand Dollar PZ - Polish Zloty SF - Swiss Franc SK - Swedish Krona TB - Thai Baht TD - Taiwan Dollar (g) Securities are grouped together by coupon or range of coupons and represent a range of maturities. (h) Principal amount of the security is adjusted for inflation. (i) Subject to financing transaction. (j) Security is in default. (k) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive fixed rate equal to 6.949% and pay floating rate based on 6-month BP-LIBOR. Broker: Merrill Lynch Exp. 08/06/2003 BP 4,500 $ 240 Receive floating rate based on 6-month Australian Bank Bill and pay interest rate swap equal to 5.217% Broker: Morgan Stanley Exp. 03/15/2006 A$ 36,800 171 Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.248%. Broker: Royal Bank of Canada Exp. 08/02/2005 C$ 60,600 (1,492) Receive floating rate based on 3-Month H$-HIBOR and pay fixed rate equal to 6.910%. need to review the docs. Broker: Goldman Sachs Exp. 02/15/2006 H$ 293,000 (1,988) Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.515%. Broker: J.P. Morgan Exp. 05/10/2002 C$ 24,330 (302) Receive floating rate based on 6-month JY-LIBOR and pay fixed rate equal to 2.020%. Broker: Goldman Sachs Exp. 05/18/2010 JY 1,776,000 (961) 54 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive fixed rate equal to 6.790% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 02/15/2006 $ 37,200 $ 2,190 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2006 83,700 1,985 Receive fixed rate equal to 5.683% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Exp. 01/08/2004 BP 33,800 509 Receive floating rate based on 3-Month H$-HIBOR and pay fixed rate equal to 5.906%. Broker: Goldman Sachs Exp. 07/11/2006 H$ 419,000 (270) Receive fixed rate equal to 5.710% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 07/11/2006 $ 53,700 528 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2011 46,400 589 Receive fixed rate equal to 5.900% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 01/26/2004 BP 26,400 439 Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.410% Broker: Morgan Stanley Exp. 09/01/2002 11,000 (41) Receive fixed rate equal to 5.513% and pay floating rate based on 6-month BP-LIBOR Broker: Morgan Stanley Exp. 03/01/2004 11,000 99 Receive fixed rate equal to 6.343% and pay floating rate based on 6-month EURO-LIBOR Broker: Lehman Brothers Exp. 03/08/2016 EC 47,500 (25) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.465% Broker: Lehman Brothers Exp. 03/07/2016 BP 30,200 49 Receive fixed rate equal to 6.273% and pay floating rate based on 6-month EURO-LIBOR Broker: Morgan Stanley Exp. 03/13/2016 EC 32,960 (68) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.778% Broker: Morgan Stanley Exp. 03/13/2016 BP 20,600 $ (50) Receive fixed rate equal to 5.471% and pay floating rate based on 6-month BP-LIBOR Broker: Goldman Sachs Exp. 03/15/2006 24,700 206 Receive fixed rate equal to 5.440% and pay floating rate based on 3-month LIBOR Broker: Goldman Sachs Exp. 03/19/2006 $ 9,500 13 Receive floating rate based on 3-month H$-HIBOR and pay fixed rate equal to 5.550%. Broker: Goldman Sachs Exp. 03/16/2006 H$ 73,800 51 Receive fixed rate equal to 5.467% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 03/15/2006 $ 18,400 1 Receive fixed rate equal to 5.225% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/19/2003 BP 53,370 27 Receive fixed rate equal to 5.133% and pay floating rate based on 3-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/19/2003 145,900 (136) ----------- $ 1,764 ----------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 55 PIMCO Schedule of Investments A, B, and C Classes Global Bond Fund II March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- AUSTRALIA (f)(g) 2.9% -------------------------------------------------------------------------------- General Motors Acceptance Corp. 4.849% due 03/25/2002 (d) EC 1,200 $ 1,053 Registered Australian Mortgage Securities 5.138% due 09/26/2032 (d) 399 351 Superannuation Members Home Loans Global Fund 6.835% due 06/15/2026 (d) $ 400 400 Torrens Trust 5.424% due 07/15/2031 (d) 408 408 ----------- Total Australia 2,212 (Cost $2,335) ----------- -------------------------------------------------------------------------------- AUSTRIA (f)(g) 0.7% -------------------------------------------------------------------------------- Republic of Austria 5.500% due 01/15/2010 EC 600 547 ----------- Total Austria 547 (Cost $512) ----------- -------------------------------------------------------------------------------- BELGIUM (f)(g) 1.7% -------------------------------------------------------------------------------- Kingdom of Belgium 6.750% due 11/21/2004 (d) BF 5,800 136 7.500% due 07/29/2008 (i) EC 900 915 5.000% due 09/28/2011 (i) 300 262 ----------- Total Belgium 1,313 (Cost $1,436) ----------- -------------------------------------------------------------------------------- BRAZIL 1.2% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (d) $ 1,012 917 ----------- Total Brazil 917 (Cost $942) ----------- -------------------------------------------------------------------------------- CANADA (f)(g) 9.0% -------------------------------------------------------------------------------- Beneficial Canada, Inc. 6.350% due 04/01/2002 C$ 330 212 Commonwealth of Canada 7.000% due 12/01/2006 (i) 8,900 6,133 5.500% due 06/01/2010 800 510 ----------- Total Canada 6,855 (Cost $7,126) ----------- -------------------------------------------------------------------------------- CAYMAN ISLANDS (f)(g) 0.6% -------------------------------------------------------------------------------- International Credit Recovery-Japan 0.863% due 08/25/2005 JY 17,297 138 0.746% due 08/25/2005 10,000 80 MBNA American Euro 4.887% due 05/19/2004 (d) EC 280 246 ----------- Total Cayman Islands 464 (Cost $545) ----------- -------------------------------------------------------------------------------- DENMARK (f)(g) 1.7% -------------------------------------------------------------------------------- Lb Rheinland - PFALZ 4.750% due 04/04/2008 EC 810 704 Nykredit 6.000% due 10/01/2009 DK 3,986 455 Unikredit Realkredit 6.000% due 07/01/2029 997 114 ----------- Total Denmark 1,273 (Cost $1,249) ----------- -------------------------------------------------------------------------------- FRANCE (f)(g) 7.9% -------------------------------------------------------------------------------- Axa 2.500% due 01/01/2014 EC 62 54 Compagnie Financiere de CIC-UE 6.379% due 10/29/2049 (d) $ 300 293 Republic of France 5.500% due 04/25/2007 (i) EC 470 436 4.000% due 04/25/2009 (i) 1,170 982 3.000% due 07/25/2009 (h) 310 264 4.000% due 10/25/2009 (i) 4,460 3,689 5.500% due 04/25/2010 330 305 ----------- Total France 6,023 (Cost $6,178) ----------- -------------------------------------------------------------------------------- GERMANY (f)(g) 20.2% -------------------------------------------------------------------------------- Commerzbank AG 5.206% due 10/25/2032 (d) EC 800 706 Depfa Pfandbriefbank 4.750% due 07/15/2008 130 112 5.750% due 03/04/2009 (i) 130 119 Hypothekenbank in Essen AG 5.500% due 02/20/2007 (i) 310 281 Landesbank Baden-Wuerttemberg AG 5.500% due 04/02/2007 DM 390 354 Republic of Germany 6.000% due 07/04/2007 (i) EC 430 409 5.250% due 01/04/2008 (i) 3,630 3,333 4.125% due 07/04/2008 (i) 3,200 2,735 4.500% due 07/04/2009 (i) 5,480 4,782 5.375% due 01/04/2010 (i) 1,960 1,809 6.250% due 01/04/2030 (i) 200 199 Rheinische Hypothekenbank AG 4.250% due 09/24/2008 390 326 WestDeutsche Landersbank 4.750% due 09/28/2007 190 166 ----------- Total Germany 15,331 (Cost $15,502) ----------- -------------------------------------------------------------------------------- GREECE (f)(g) 0.7% -------------------------------------------------------------------------------- Hellenic Republic 6.938% due 06/06/2001 (d) $ 400 401 7.890% due 06/17/2003 (d) GD 22 20 7.080% due 10/23/2003 (d) 99 91 ----------- Total Greece 512 (Cost $558) ----------- -------------------------------------------------------------------------------- ITALY (f)(g) 17.2% -------------------------------------------------------------------------------- Finmeccanica SpA 2.000% due 06/08/2005 EC 188 160 First Italian Auto Transaction 5.139% due 07/01/2008 (d) 890 783 International Credit Recovery 5.602% due 03/15/2010 300 264 Island Finance 5.404% due 03/30/2015 (d) 370 327 Republic of Italy 5.750% due 09/15/2002 (i) 2,700 2,422 4.750% due 07/01/2005 (i) 1,680 1,488 7.750% due 11/01/2006 (i) 700 705 4.500% due 05/01/2009 (i) 6,980 5,944 4.250% due 11/01/2009 720 601 5.500% due 11/01/2010 (i) 390 354 ----------- Total Italy 13,048 (Cost $13,312) ----------- 56 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- JAPAN (f)(g) 1.7% -------------------------------------------------------------------------------- Government of Japan 3.400% due 06/20/2005 (i) JY 39,000 $ 348 0.900% due 12/22/2008 (d)(i) 103,600 820 SHL Corp. Ltd. 1.031% due 12/25/2024 (d) 11,051 88 1.331% due 12/25/2024 (d) 5,000 40 ----------- Total Japan 1,296 (Cost $1,408) ----------- -------------------------------------------------------------------------------- MEXICO (f)(g) 1.6% -------------------------------------------------------------------------------- Petroleos Mexicanos 8.850% due 09/15/2007 $ 140 144 9.375% due 12/02/2008 190 198 United Mexican States 8.750% due 05/30/2002 BP 250 361 5.000% due 09/30/2002 JY 25,000 207 10.375% due 01/29/2003 DM 200 96 4.000% due 03/11/2004 JY 20,000 163 ----------- Total Mexico 1,169 (Cost $1,273) ----------- -------------------------------------------------------------------------------- NETHERLANDS (f)(g) 0.7% -------------------------------------------------------------------------------- Unilever NV 4.830% due 09/17/2001 (d) EC 600 525 Total Netherlands 525 (Cost $512) -------------------------------------------------------------------------------- NEW ZEALAND (f)(g) 0.7% -------------------------------------------------------------------------------- Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 1,130 501 ----------- Total New Zealand 501 (Cost $637) ----------- -------------------------------------------------------------------------------- PERU 0.5% -------------------------------------------------------------------------------- Republic of Peru 4.000% due 03/07/2017 $ 250 156 4.500% due 03/07/2017 (d) 300 205 ----------- Total Peru 361 (Cost $373) ----------- -------------------------------------------------------------------------------- SOUTH KOREA (f)(g) 2.2% -------------------------------------------------------------------------------- Export-Import Bank Korea 7.250% due 06/25/2001 $ 260 261 Korea Development Bank 4.885% due 05/14/2001 DM 440 198 2.450% due 09/10/2001 JY 37,000 296 1.875% due 02/13/2002 114,000 911 ----------- Total South Korea 1,666 (Cost $1,795) ----------- -------------------------------------------------------------------------------- SPAIN (f)(g) 4.2% -------------------------------------------------------------------------------- Kingdom of Spain 4.950% due 07/30/2005 (i) EC 1,620 1,448 5.150% due 07/30/2009 (i) 1,990 1,782 ----------- Total Spain 3,230 (Cost $3,217) ----------- -------------------------------------------------------------------------------- SUPRANATIONAL (f)(g) 2.4% -------------------------------------------------------------------------------- Asian Development Bank 5.375% due 09/15/2003 A$ 600 295 5.250% due 09/15/2004 600 294 Eurofima 4.750% due 07/07/2004 (i) SK 7,200 696 International Bank for Reconstruction & Development 7.250% due 04/09/2001 N$ 1,376 555 ----------- Total Supranational 1,840 (Cost $2,246) ----------- -------------------------------------------------------------------------------- SWEDEN (f)(g) 0.4% -------------------------------------------------------------------------------- Kingdom of Sweden 13.000% due 06/15/2001 SK 900 $ 88 5.000% due 01/28/2009 2,300 228 ----------- Total Sweden 316 (Cost $348) ----------- -------------------------------------------------------------------------------- UNITED KINGDOM (f)(g) 10.4% -------------------------------------------------------------------------------- Abbey National Treasury Service PLC 7.625% due 12/30/2002 BP 280 411 British Telecommunications PLC 6.079% due 12/15/2003 (d) $ 600 600 Core 5.138% due 03/17/2009 (d) 461 458 Equitable 8.000% due 08/29/2049 BP 700 526 Haus Ltd. 5.124% due 12/10/2037 (d) EC 1,500 1,320 Holmes Financing PLC 5.859% due 07/15/2017 (d) $ 700 700 Lloyds TSB Bank PLC 5.625% due 07/15/2049 EC 590 492 Royal Bank of Scotland Group PLC 6.770% due 03/31/2049 1,000 919 SCCR Series 1 Ltd. 5.373% due 12/15/2031 (d) 118 104 United Kingdom Gilt 7.500% due 12/07/2006 (i) BP 750 1,200 7.250% due 12/07/2007 750 1,204 ----------- Total United Kingdom 7,934 (Cost $8,913) ----------- -------------------------------------------------------------------------------- UNITED STATES (f)(g) 71.0% -------------------------------------------------------------------------------- Asset-Backed Securities 7.7% AFC Home Equity Loan Trust 5.360% due 12/22/2027 (d) $ 302 302 Amresco Residential Securities Mortgage Loan Trust 6.000% due 06/25/2029 (d) 438 440 Banc One Auto Grantor Trust 6.270% due 11/20/2003 8 8 Bayview Financial Acquisition Trust 5.920% due 11/25/2030 (d) 700 700 Chase Manhattan Grantor Trust 6.610% due 09/15/2002 4 4 Conseco Finance 5.534% due 10/15/2031 (d) 633 636 CS First Boston Mortgage Securities Corp. 5.424% due 12/15/2030 (d) 672 673 EQCC Home Equity Loan Trust 5.770% due 05/20/2010 106 106 Nissan Auto Receivables Grantor Trust 5.450% due 04/15/2004 39 39 Providian Gateway Master Trust 5.380% due 03/15/2007 800 800 Providian Home Equity Loan Trust 5.340% due 06/25/2025 (d) 477 478 PSB Lending Home Loan Owner Trust 6.830% due 05/20/2018 23 23 Residential Asset Securities Corp. 5.854% due 12/25/2013 (d) 0 0 Residential Funding Mortgage Securities, Inc. 10.836% due 06/01/2001 (d) 800 800 Salomon Brothers Mortgage Securities VII 5.584% due 11/15/2029 (d) 137 137 United Panama Mortgage Loan Asset Backed 5.500% due 10/25/2029 (d) 576 577 USAA Auto Loan Grantor Trust 5.800% due 01/15/2005 113 114 ----------- 5,837 ----------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 57 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Global Bond Fund II March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Corporate Bonds & Notes 12.3% Alpha Wind 11.321% due 05/23/2001 (d) $ 500 $ 500 Associates Corp. of North America 5.400% due 08/27/2001 (d) 100 100 Associates First Capital Corp. 5.810% due 01/25/2031 (d) 588 588 Bancomext Trust Division 8.000% due 08/05/2003 70 71 Bear Stearns Co., Inc. 5.210% due 03/28/2003 (d) 380 380 Beckman Instruments, Inc. 7.100% due 03/04/2003 22 22 Capital One Bank 6.308% due 07/28/2003 (d) 500 492 Citi Credit Card Master Trust 4.875% due 04/07/2007 DM 800 360 CMS Energy Corp. 8.125% due 05/15/2002 $ 26 26 Finova Capital Corp. 6.040% due 11/08/2002 (d)(k) 1,250 1,026 6.316% due 04/08/2003 (d)(k) 700 574 Ford Motor Credit Co. 1.000% due 12/22/2003 JY 14,000 112 1.200% due 02/07/2005 98,000 780 Gold Eagle Capital Ltd. 11.079% due 04/15/2001 (d) $ 500 500 Household Finance Corp. 5.773% due 08/06/2002 (d) 230 231 J.P. Morgan & Co., Inc. 6.655% due 02/15/2012 (d) 100 91 Jones Intercable, Inc. 8.875% due 04/01/2007 26 28 Lehman Brothers Holdings, Inc. 6.479% due 07/15/2002 (d) 400 403 MGM Grand, Inc. 6.950% due 02/01/2005 10 10 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (h) 2,042 2,053 6.204% due 10/21/2002 (d) BP 200 284 Sprint Capital Corp. 5.875% due 05/01/2004 $ 50 49 TCI Communications, Inc. 5.555% due 04/01/2002 (d) 300 298 Texas Utilities Corp. 5.420% due 06/25/2001 (d) 200 200 7.389% due 09/24/2001 (d) 200 199 ------------ 9,377 ------------ Mortgage-Backed Securities 29.3% Chase Mortgage Finance Corp. 6.550% due 08/25/2028 420 424 Citicorp Mortgage Securities, Inc. 6.500% due 07/25/2028 255 256 6.500% due 03/25/2029 10 10 Crusade Global Trust 5.719% due 05/15/2030 (d) 1,403 1,407 Fannie Mae 7.000% due 02/25/2020 99 100 Government National Mortgage Association 5.750% due 02/16/2030 (d) 1,232 1,233 5.800% due 02/16/2030 (d) 1,334 1,337 6.000% due 06/20/2030-06/15/2029 (d)(e) 15,602 8,193 7.625% due 11/20/2021 (d) 36 37 7.750% due 07/20/2022 (d) 578 592 7.750% due 09/20/2023 (d) 348 356 7.750% due 07/20/2025 (d) 285 292 7.750% due 09/20/2025 (d) 33 34 7.625% due 12/20/2025 (d) 18 18 7.750% due 09/20/2026 (d) 21 21 7.625% due 11/20/2026 (d) 515 527 7.625% due 11/20/2026 (d) 242 248 7.625% due 12/20/2026 (d) 49 50 7.000% due 04/20/2030-05/20/2030 (d)(e) 3,062 1,845 Homeside Mortgage Securities Trust 5.929% due 01/20/2027 (d) 300 300 Medallion Trust 5.880% due 07/12/2031 (d) 821 821 Puma Finance Ltd. 5.916% due 04/15/2031 (d) 332 349 Residential Funding Mortgage Securities, Inc. 5.779% due 05/12/2032 (d) 2,245 2,248 Sasco Floating Rate Commercial Mortgage Trust 5.408% due 11/20/2001 (d) 380 380 Structured Asset Mortgage Investments, Inc. 6.581% due 06/25/2029 (d) 205 208 Structured Asset Securities Corp. 7.398% due 02/25/2030 (d) 1,034 1,036 ------------ 22,322 ------------ Municipal Bonds & Notes 0.8% California State General Obligation, (FGIC Insured), Series 1997 4.750% due 12/01/2028 300 280 Long Island Power Authority New York Electric System, (FSA Insured), Series 1998 5.125% due 12/01/2022 300 297 ------------ 577 ------------ U.S. Government Agencies 0.8% Small Business Administration 6.640% due 02/10/2011 600 604 U.S. Treasury Obligations 19.2% Treasury Inflation Protected Securities (h) 3.625% due 07/15/2002 (b)(i) 12,920 13,175 3.875% due 04/15/2029 319 341 U.S. Treasury Bonds 9.250% due 02/15/2016 600 829 8.875% due 02/15/2019 100 137 8.125% due 05/15/2021 100 130 ------------ 14,612 ------------ Preferred Security 0.9% Shares DG Funding Trust 7.153% due 12/29/2049 (d) 70 714 ------------ Total United States 54,043 (Cost $53,858) ------------ -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 0.0% -------------------------------------------------------------------------------- Principal Amount (000s) U.S. Treasury Note Futures (CBOT) Strike @ 119.000 Exp. 05/26/2001 $ 350 5 ------------ Total Purchased Call Options 5 (Cost $7) ------------ -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Government National Mortgage Association (OTC) 6.000% due 05/21/2031 Strike @ 90.281 Exp. 05/04/2001 24,000 0 Interest Rate Swap (OTC) 7.500% due 05/01/2023 Strike @ 7.500 Exp. 04/29/2002 700 1 Japanese Government Bond (OTC) 10.800% due 05/01/2023 Strike @ 97.750 Exp. 05/02/2001 1,300,000 0 U.S. Treasury Bond (OTC) 3.625% due 07/15/2002 Strike @ 95.500 Exp. 04/30/2001 13,620 0 ------------ Total Purchased Put Options 1 (Cost $36) ------------ 58 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 3.8% -------------------------------------------------------------------------------- Commercial Paper 2.7% Coca-Cola Co. 4.600% due 07/12/2001 $ 1,100 $ 1,085 General Electric Capital Corp. 4.970% due 04/04/2001 500 500 Halifax Building Society 5.080% due 08/08/2001 400 393 UBS Finance, Inc. 5.050% due 08/02/2001 100 98 ------------ 2,076 ------------ Repurchase Agreement 1.1% State Street Bank 4.600% due 04/02/2001 847 847 (Dated 03/30/2001. Collateralized by Freddie Mac 6.680% due 12/28/2001 valued at $869. Repurchase proceeds are $847.) ------------ Total Short-Term Instruments 2,923 (Cost $2,924) ------------ Total Investments (a) 163.4% $ 124,305 (Cost $127,242) Written Options (c) (0.2%) (141) (Premiums $56) Other Assets and Liabilities (Net) (63.2%) (48,071) ------------ Net Assets 100.0% $ 76,093 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $127,266 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 1,191 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (4,152) ------------ Unrealized depreciation-net $ (2,961) ------------ (b) Securities with an aggregate market value of $1,334 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- EuroBond 10 Year Note (06/2001) 14 $ 14 Government of Japan 10 Year Note (06/2001) 13 10 United Kingdom Gilt (06/2001) 8 2 U.S. Treasury 10 Year Note (06/2001) 317 (77) ------------ $ (51) ------------ (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - CME Eurodollar December Futures Strike @ 95.00 Exp. 12/17/2001 4 $ 2 $ 1 Call - CBOT U.S. Treasury Note June Futures Strike @ 107.00 Exp. 05/26/2001 3 2 3 Put - CME Eurodollar December Futures Strike @ 95.25 Exp. 12/17/2001 24 12 13 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 20 11 11 Put - OTC 3 Month LIBOR Interest Rate Swap Strike @ 7.50 Exp. 04/29/2002 1,000,000 22 105 Put - CBOT U.S. Treasury Note June Futures Strike @ 105.00 Exp. 05/26/2001 14 7 8 ------------------------ $ 56 $ 141 ------------------------ (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Securities are grouped together by coupon or range of coupons and represent a range of maturities. (f) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Sell A$ 1,450 04/2001 $ 65 Buy 269 05/2001 (2) Sell C$ 808 04/2001 10 Sell SF 5,302 05/2001 26 Sell DK 6,074 05/2001 39 Buy EC 12,608 04/2001 (100) Sell 11,741 04/2001 622 Sell 10,910 06/2001 41 Sell BP 2,479 05/2001 121 Sell H$ 13,000 05/2001 4 Buy 15,600 08/2001 (7) Sell 31,200 08/2001 24 Buy HF 47,700 08/2001 (4) Buy JY 669,475 04/2001 (132) Sell 670,601 04/2001 271 Sell 741,925 06/2001 145 Buy KW 181,300 04/2001 (23) Sell 181,300 04/2001 5 Sell N$ 2,623 04/2001 46 Sell SK 3,725 05/2001 23 Buy TB 3,800 04/2001 (3) Sell 3,800 04/2001 2 Buy TD 3,092 04/2001 (1) Sell 3,092 04/2001 1 ------------ $ 1,173 ------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 59 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Global Bond Fund II March 31, 2001 (g) Principal amount denoted in indicated currency: A$ - Australian Dollar BF - Belgian Franc BP - British Pound C$ - Canadian Dollar DK - Danish Krone DM - German Mark EC - Euro GD - Greek Drachma H$ - Hong Kong Dollar HF - Hungarian Forint JY - Japanese Yen KW - South Korean Won N$ - New Zealand Dollar SK - Swedish Krona SF - Swiss Franc TB - Thai Baht TD - Taiwan Dollar (h) Principal amount of the security is adjusted for inflation. (i) Subject to financing transaction. (j) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive fixed rate equal to 5.935% and pay floating rate based on 6 month BP-LIBOR. Broker: Merrill Lynch Exp. 11/05/2003 BP 1,700 $ 40 Receive floating rate based on 6-month Australian Bank Bill and pay fixed rate equal to 5.217%. Broker: Morgan Stanley Exp. 03/15/2006 A$ 3,600 17 Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.248%. Broker: Royal Bank of Canada Exp. 08/02/2005 C$ 8,500 (209) Receive floating rate based on 3-month H$-HIBOR and pay fixed rate equal to 6.910%. Broker: Goldman Sachs Exp. 02/15/2006 H$ 36,000 (244) Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.515%. Broker: J.P. Morgan Exp. 05/10/2002 C$ 3,400 (42) Receive floating rate based on 6-month JY-LIBOR and pay fixed rate equal to 2.020%. Broker: Goldman Sachs Exp. 05/18/2010 JY 226,000 (122) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.310%. Broker: Goldman Sachs Exp. 07/14/2005 232,000 (62) Receive fixed rate equal to 6.790% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 02/15/2006 4,600 271 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2006 36,300 744 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 06/15/2006 100 2 Receive fixed rate equal to 5.683% and pay floating rate based on 6 month BP-LIBOR. Broker: Morgan Stanley Exp. 01/08/2004 BP 4,200 63 Receive floating rate based on 3-month H$-HIBOR and pay fixed rate equal to 5.906%. Broker: Goldman Sachs Exp. 07/11/2006 H$ 50,000 (68) Receive fixed rate equal to 5.710% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 07/11/2006 $ 6,400 63 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2011 8,000 101 Receive fixed rate equal to 5.900% and pay floating rate based on 6 month BP-LIBOR. Broker: Goldman Sachs Exp. 01/26/2004 BP 2,400 40 Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.410%. Broker: Morgan Stanley Exp. 09/01/2002 1,300 (5) Receive fixed rate equal to 5.513% and pay floating rate based on 6 month BP-LIBOR. Broker: Morgan Stanley Exp. 03/01/2004 1,300 12 Receive fixed rate equal to 6.343% and pay floating rate based on 6 month EURO-LIBOR. Broker: Lehman Brothers Exp. 03/08/2016 EC 5,500 (3) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.465%. Broker: Lehman Brothers Exp. 03/07/2016 BP 3,500 6 60 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Receive fixed rate equal to 6.273% and pay floating rate based on 6 month EURO-LIBOR. Broker: Morgan Stanley Exp. 03/13/2016 EC 3,810 $ (8) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.578%. Broker: Morgan Stanley Exp. 03/13/2016 BP 2,380 (6) Receive fixed rate equal to 5.471% and pay floating rate based on 6 month BP-LIBOR. Broker: Goldman Sachs Exp. 03/15/2006 4,000 33 Receive fixed rate equal to 5.440% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 03/19/2006 $ 600 1 Receive floating rate based on 3-month H$-HIBOR and pay fixed rate equal to 5.550%. Broker: Goldman Sachs Exp. 03/16/2006 H$ 4,300 0 Receive fixed rate equal to 5.467% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 03/15/2006 $ 1,800 0 Receive fixed rate equal to 5.133% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 03/19/2003 BP 22,200 (21) ------------ $ 603 ------------ (k) Security is in default. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 61 PIMCO Schedule of Investments A, B, and C Classes High Yield Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 73.6% -------------------------------------------------------------------------------- Banking & Finance 4.5% Americo Life, Inc. 9.250% due 06/01/2005 $ 198 $ 193 Amethyst Financial Co. Ltd. 11.750% due 10/29/2001 3,944 3,944 Arvin Capital 9.500% due 02/01/2027 14,986 10,866 Bay View Capital Corp. 9.125% due 08/15/2007 2,900 2,277 Beaver Valley Funding Corp. 8.625% due 06/01/2007 14,197 14,946 9.000% due 06/01/2017 9,432 10,239 Choctaw Resort Development Enterprise 9.250% due 04/01/2009 1,400 1,430 Forest City Enterprises, Inc. 8.500% due 03/15/2008 10,719 10,357 General Motors Acceptance Corp. 5.722% due 04/29/2002 (d) 631 632 Golden State Holdings 6.750% due 08/01/2001 (d) 8,180 8,162 7.000% due 08/01/2003 3,073 3,048 7.125% due 08/01/2005 687 673 Host Marriott LP 8.375% due 02/15/2006 9,197 9,151 Lamar Media Corp. 9.625% due 12/01/2006 100 105 Presidential Life Insurance Corp. 7.875% due 02/15/2009 7,451 7,233 Reliance Group Holdings, Inc. 0.000% due 11/15/2049 (c)(e) 3,769 330 Sumitomo Bank Treasury Co. 9.400% due 12/29/2049 (d) 10,459 10,087 Telewest Credit Links 10.875% due 02/07/2005 14,000 11,839 Trizec Finance Ltd. 10.875% due 10/15/2005 13,772 14,047 ------------ 119,559 ------------ Industrials 59.7% 360 Networks, Inc. 13.000% due 05/01/2008 5,740 2,210 Abbey Healthcare Group 9.500% due 11/01/2002 11,346 11,431 Adelphia Business Solutions, Inc. 12.250% due 09/01/2004 5,679 5,310 Adelphia Communications Corp. 10.875% due 10/01/2010 15 16 Allied Waste North America, Inc. 7.375% due 01/01/2004 13,910 13,701 7.625% due 01/01/2006 7,438 7,252 8.875% due 04/01/2008 8,000 7,928 American Airlines, Inc. 10.610% due 03/04/2010 513 580 American Cellular Corp. 9.500% due 10/15/2009 6,000 5,820 American Media Operation, Inc. 10.250% due 05/01/2009 789 809 American Standard Cos., Inc. 7.125% due 02/15/2003 158 160 9.250% due 12/01/2016 1,177 1,183 Amerigas Partners LP 10.000% due 04/15/2006 4,900 4,895 10.125% due 04/15/2007 2,367 2,450 AM-FM, Inc. 8.750% due 06/15/2007 4,457 4,691 8.000% due 11/01/2008 4,144 4,320 Amphenol Corp. 9.875% due 05/15/2007 5,445 5,731 Archibald Candy Corp. 10.250% due 07/01/2004 3,155 1,672 Arco Chemical Co. 9.375% due 12/15/2005 4,425 4,561 Ball Corp. 7.750% due 08/01/2006 6,704 6,830 8.250% due 08/01/2008 5,206 5,323 Beckman Instruments, Inc. 7.100% due 03/04/2003 6,423 6,471 7.450% due 03/04/2008 12,717 12,559 Benedek Communications Corp. 0.000% due 05/15/2006 (c) 1,184 787 Bergen Brunswig Corp. 7.375% due 01/15/2003 6,950 6,912 7.250% due 06/01/2005 500 486 Beverly Enterprises, Inc. 9.000% due 02/15/2006 13,070 13,266 British Sky Broadcasting PLC 7.300% due 10/15/2006 6,733 6,616 6.875% due 02/23/2009 10,000 9,268 8.200% due 07/15/2009 21,299 21,296 Browning-Ferris Industries, Inc. 6.100% due 01/15/2003 3,234 3,150 7.875% due 03/15/2005 1,578 1,575 Building Materials Corp. 7.750% due 07/15/2005 971 553 8.000% due 10/15/2007 1,007 539 8.000% due 12/01/2008 10,601 5,672 Cadmus Communications Corp. 9.750% due 06/01/2009 2,250 2,109 Call-Net Enterprises, Inc. 8.000% due 08/15/2008 6,765 2,089 Canadian Forest Oil Ltd. 8.750% due 09/15/2007 11,372 11,656 Century Aluminum Co. 11.750% due 04/15/2008 6,050 6,171 Century Communications Corp. 9.750% due 02/15/2002 513 517 0.010% due 03/15/2003 15,743 12,752 9.500% due 03/01/2005 10,500 10,487 8.750% due 10/01/2007 2,998 2,893 CF Cable TV, Inc. 9.125% due 07/15/2007 9,149 9,319 Charter Communications Holdings LLC 8.250% due 04/01/2007 10,845 10,425 8.625% due 04/01/2009 3,944 3,816 10.000% due 04/01/2009 8,172 8,519 11.750% due 01/15/2010 35 24 9.920% due 04/01/2011 8,000 5,620 Clark R & M, Inc. 8.375% due 11/15/2007 2,392 1,854 Clearnet Communications, Inc. 0.000% due 05/01/2009 (c) 4,733 3,999 Cliffs Drilling Co. 10.250% due 05/15/2003 592 612 Columbus McKinnon 8.500% due 04/01/2008 8,306 7,019 Consolidated Container 10.125% due 07/15/2009 6,428 6,332 Constellation Brands, Inc. 8.000% due 02/15/2008 6,000 6,165 8.500% due 03/01/2009 4,000 4,040 Container Corp. of America 9.750% due 04/01/2003 789 807 11.250% due 05/01/2004 5,185 5,211 Continental Cablevision 9.500% due 08/01/2013 7,900 8,757 Cross Timbers Oil Co. 9.250% due 04/01/2007 1,136 1,198 8.750% due 11/01/2009 1,900 1,986 Crown Castle International Corp. 0.000% due 11/15/2007 1,775 1,473 10.750% due 08/01/2011 12,755 13,233 CSC Holdings, Inc. 9.250% due 11/01/2005 789 825 9.875% due 05/15/2006 671 704 7.875% due 12/15/2007 79 80 7.625% due 04/01/2011 9,150 8,978 9.875% due 02/15/2013 2,595 2,790 9.875% due 04/01/2023 3,155 3,407 62 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Cumberland Farms 10.500% due 10/01/2003 $ 4,528 $ 4,415 Delta Air Lines, Inc. 10.790% due 03/26/2014 1,786 1,988 Diamond Cable Communication Co. 13.250% due 09/30/2004 1,184 1,160 11.750% due 12/15/2005 (d) 7,887 7,335 0.000% due 02/15/2007 (c) 2,700 1,944 Echostar Communications Corp. 9.250% due 02/01/2006 19,177 19,248 9.375% due 02/01/2009 6,704 6,754 Electric Lightwave, Inc. 6.050% due 05/15/2004 1,000 914 Energis PLC 9.750% due 06/15/2009 3,550 3,355 Fairpoint Communications, Inc. 9.500% due 05/01/2008 6,412 5,354 10.908% due 05/01/2008 (d) 3,550 3,345 Federal-Mogul Corp. 7.500% due 07/01/2004 5,719 886 7.375% due 01/15/2006 119 17 7.750% due 07/01/2006 7,473 1,084 Ferrellgas Partners LP 9.375% due 06/15/2006 11,931 11,573 Fisher Scientific International 7.125% due 12/15/2005 10,845 10,357 9.000% due 02/01/2008 12,249 12,280 Flag Ltd. 8.250% due 01/30/2008 22,141 20,147 Forest Oil Corp. 10.500% due 01/15/2006 2,828 2,984 Fox/Liberty Networks LLC 0.000% due 08/15/2007 (c) 7,690 7,036 Garden State Newspapers 8.750% due 10/01/2009 3,120 3,042 8.625% due 07/01/2011 3,076 2,999 Global Crossing Holding Ltd. 9.500% due 11/15/2009 3,944 3,717 6.000% due 10/15/2013 9,969 9,450 Golden Northwest Aluminum 12.000% due 12/15/2006 1,933 1,653 Gulf Canada Resources Ltd. 9.625% due 07/01/2005 2,233 2,311 8.375% due 11/15/2005 3,155 3,423 Harrahs Operating Co., Inc. 7.875% due 12/15/2005 10,206 10,257 7.500% due 01/15/2009 16,307 16,275 HCA - The Healthcare Co. 6.870% due 09/15/2003 1,026 1,035 6.910% due 06/15/2005 986 971 8.850% due 01/01/2007 5,350 5,791 7.000% due 07/01/2007 14,993 14,562 8.700% due 02/10/2010 450 476 8.360% due 04/15/2024 4,733 4,586 6.730% due 07/15/2045 3,944 3,985 Hercules, Inc. 11.125% due 11/15/2007 7,454 7,566 HMH Properties, Inc. 7.875% due 08/01/2005 28,334 27,554 Hollinger International Publishing 8.625% due 03/15/2005 198 201 9.250% due 02/01/2006 3,629 3,738 9.250% due 03/15/2007 537 556 Horseshoe Gaming Holding 8.625% due 05/15/2009 15,250 15,212 HS Resources, Inc. 9.875% due 12/01/2003 2,879 2,937 9.250% due 11/15/2006 12,365 12,860 Huntsman Corp. 9.500% due 07/01/2007 9,718 7,532 Huntsman ICI Chemicals LLC 10.125% due 07/01/2009 1,796 1,859 Huntsman Polymers Corp. 11.750% due 12/01/2004 3,629 3,030 Intermedia Communications, Inc. 0.000% due 05/15/2006 (c) 20,240 20,442 International Game Technology 7.875% due 05/15/2004 11,594 11,768 8.375% due 05/15/2009 11,121 11,455 ISP Holdings, Inc. 9.000% due 10/15/2003 16,374 14,245 John Q. Hammons Hotels 8.875% due 02/15/2004 2,312 2,231 9.750% due 10/01/2005 2,633 2,541 Jones Intercable, Inc. 8.875% due 04/01/2007 3,991 4,284 Jupiters Ltd. 8.500% due 03/01/2006 10,096 10,071 K Mart Corp. 12.350% due 01/01/2008 3,803 4,111 8.800% due 07/01/2010 902 818 9.350% due 01/02/2020 10,203 7,974 9.780% due 01/05/2020 7,552 6,432 Keebler Corp. 10.750% due 07/01/2006 4,733 5,020 KPNQWest BV 8.125% due 06/01/2009 19,560 17,115 L-3 Communications Corp. 10.375% due 05/01/2007 5,938 6,116 8.500% due 05/15/2008 466 472 Lear Corp. 8.250% due 02/01/2002 5,056 5,081 7.960% due 05/15/2005 4,315 4,352 Lenfest Communications 8.375% due 11/01/2005 8,400 9,156 10.500% due 06/15/2006 415 489 Level 3 Communications, Inc. 11.000% due 03/15/2008 4,338 3,416 9.125% due 05/01/2008 27,655 19,773 0.000% due 12/01/2008 (c) 9,425 4,571 11.250% due 03/15/2010 789 619 12.875% due 03/15/2010 18,000 6,930 Levi Strauss & Co. 6.800% due 11/01/2003 15,853 14,902 Leviathan Gas Corp. 10.375% due 06/01/2009 2,773 2,981 Lin Television Corp. 8.375% due 03/01/2008 10,035 9,082 Lyondell Chemical Co. 9.625% due 05/01/2007 12,174 12,539 Mail-Well Corp. 8.750% due 12/15/2008 8,026 6,862 Mandalay Resort Group 6.750% due 07/15/2003 16,077 15,554 9.250% due 12/01/2005 4,812 4,854 6.450% due 02/01/2006 79 74 10.250% due 08/01/2007 198 204 9.500% due 08/01/2008 395 413 Manor Care, Inc. 8.000% due 03/01/2008 3,000 3,068 Marsh Supermarkets, Inc. 8.875% due 08/01/2007 5,916 5,724 McLeodUSA, Inc. 0.000% due 03/01/2007 (c) 34,329 28,321 8.375% due 03/15/2008 4,023 3,430 9.500% due 11/01/2008 14,997 13,535 8.125% due 02/15/2009 3,815 3,205 11.500% due 05/01/2009 789 773 Mediacom LLC 9.500% due 01/15/2013 22,600 22,205 Metromedia Fiber Network, Inc. 10.000% due 11/15/2008 18,301 15,281 10.000% due 12/15/2009 11,910 9,945 MGM Grand, Inc. 6.950% due 02/01/2005 23,993 23,977 8.500% due 09/15/2010 15,000 15,680 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 63 PIMCO Schedule of Investments A, B, and C Classes (Cont.) High Yield Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Mirage Resorts, Inc. 6.625% due 02/01/2005 $ 2,761 $ 2,733 7.250% due 10/15/2006 2,106 2,111 Newpark Resources, Inc. 8.625% due 12/15/2007 3,470 3,435 Nextel Communications, Inc. 0.000% due 09/15/2007 (c) 9,000 6,683 9.375% due 11/15/2009 20,333 17,334 Nextel Partners, Inc. 0.000% due 02/01/2009 (c) 14,701 9,151 11.000% due 03/15/2010 2,658 2,319 Nextlink Communications, Inc. 9.625% due 10/01/2007 7,099 4,224 10.750% due 06/01/2009 8,426 5,013 10.500% due 12/01/2009 8,037 4,943 NL Industries, Inc. 11.750% due 10/15/2003 1,135 1,158 NTL, Inc. 12.750% due 04/15/2005 553 528 11.500% due 02/01/2006 2,600 2,327 11.500% due 10/01/2008 5,026 4,448 Octel Developments PLC 10.000% due 05/01/2006 1,499 1,506 Omnicare, Inc. 5.000% due 12/01/2007 6,000 5,258 8.125% due 03/15/2011 6,000 6,150 Orion Network Systems, Inc. 0.000% due 01/15/2007 (c) 9,885 2,669 11.250% due 01/15/2007 11,535 4,268 P&L Coal Holdings 8.875% due 05/15/2008 15,025 15,739 Park Place Entertainment Corp. 8.875% due 09/15/2008 4,733 4,839 Petroleos Mexicanos 9.375% due 12/02/2008 6,310 6,578 PharMerica, Inc. 8.375% due 04/01/2008 14,607 13,950 Physician Sales and Service, Inc. 8.500% due 10/01/2007 3,696 3,049 Piedmont Aviation, Inc. 10.200% due 01/15/2005 1,163 1,187 10.250% due 03/28/2005 451 446 9.900% due 11/08/2006 865 841 Pioneer National Resources Co. 8.875% due 04/15/2005 15,853 16,755 8.250% due 08/15/2007 6,827 7,000 6.500% due 01/15/2008 5,482 5,086 Price Communications Wireless, Inc. 9.125% due 12/15/2006 7,947 8,205 Pride International, Inc. 9.375% due 05/01/2007 4,595 4,865 Primedia, Inc. 10.250% due 06/01/2004 3,155 3,234 8.500% due 02/01/2006 8,671 8,801 7.625% due 04/01/2008 6,507 6,279 Qwest Communications International, Inc. 7.500% due 11/01/2008 5,916 6,138 R & B Falcon Corp. 6.500% due 04/15/2003 6,144 6,196 9.125% due 12/15/2003 1,250 1,306 6.750% due 04/15/2005 3,569 3,645 9.125% due 12/15/2008 722 784 R.H. Donnelley, Inc. 9.125% due 06/01/2008 5,455 5,591 Racers 8.375% due 10/01/2007 17,242 14,021 Renaissance Media Group 0.000% due 04/15/2008 (c) 16,960 12,974 Rogers Cablesystems Ltd. 10.000% due 03/15/2005 3,155 3,392 Rogers Cantel, Inc. 8.300% due 10/01/2007 3,524 3,498 8.800% due 10/01/2007 1,065 1,068 9.375% due 06/01/2008 27,024 28,173 Rural Cellular Corp. 9.625% due 05/15/2008 11,502 10,582 Safety-Kleen Corp. 9.250% due 06/01/2008 (e) 22,459 281 9.250% due 05/15/2009 (e) 11,042 138 SC International Services, Inc. 9.250% due 09/01/2007 11,970 12,389 Scotia Pacific Co. LLC 7.710% due 01/20/2014 (d) 142 104 Silgan Holdings, Inc. 9.000% due 06/01/2009 11,556 11,556 Smith's Food & Drug Centers, Inc. 8.640% due 07/02/2012 222 239 Station Casinos, Inc. 10.125% due 03/15/2006 782 812 9.750% due 04/15/2007 5,403 5,565 8.875% due 12/01/2008 631 639 9.875% due 07/01/2010 789 793 Stone Container Corp. 8.812% due 10/01/2005 1,117 1,121 11.500% due 08/15/2006 3,826 3,998 Telecorp PCS, Inc. 10.625% due 07/15/2010 10,888 10,561 Telewest Communications PLC 9.625% due 10/01/2006 3,873 3,757 11.000% due 10/01/2007 (d) 5,136 5,059 11.250% due 11/01/2008 789 797 0.000% due 04/15/2009 (c) 6,746 3,997 9.875% due 02/01/2010 6,113 5,777 Tenet Healthcare Corp. 7.875% due 01/15/2003 789 806 8.625% due 12/01/2003 5,684 5,905 8.000% due 01/15/2005 5,731 5,910 8.625% due 01/15/2007 5,761 6,006 7.625% due 06/01/2008 18,945 19,158 8.125% due 12/01/2008 10,500 10,841 Time Warner Telecom, Inc. 10.125% due 02/01/2011 5,650 5,678 Triad Hospitals, Inc. 11.000% due 05/15/2009 1,653 1,827 Tritel PCS, Inc. 10.375% due 01/15/2011 13,250 12,753 U.S. Airways, Inc. 9.625% due 09/01/2003 17,648 17,805 9.330% due 01/01/2006 3,280 3,198 United Defense Industries, Inc. 8.750% due 11/15/2007 789 783 United Pan-Europe Communications NV 0.000% due 02/01/2009 (c) 6,502 2,406 10.875% due 08/01/2009 5,885 3,972 1.000% due 11/01/2009 7,000 2,485 13.750% due 02/01/2010 6,500 2,178 Vintage Petroleum, Inc. 9.000% due 12/15/2005 7,761 8,033 9.750% due 06/30/2009 2,009 2,200 VoiceStream Wireless Corp. 10.375% due 11/15/2009 3,155 3,471 Waste Management, Inc. 7.000% due 05/15/2005 513 520 WCG Corp. 8.250% due 03/15/2004 11,900 11,850 Western Gas Resources, Inc. 10.000% due 06/15/2009 5,700 6,071 Williams Communications Group, Inc. 10.700% due 10/01/2007 7,493 5,845 11.700% due 08/01/2008 2,000 1,570 10.875% due 10/01/2009 7,492 5,507 11.875% due 08/01/2010 6,000 4,650 World Color Press, Inc. 8.375% due 11/15/2008 513 526 7.750% due 02/15/2009 1,381 1,373 64 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Worldwide Fiber, Inc. 12.000% due 08/01/2009 $ 5,969 $ 2,238 XO Communications, Inc. 12.250% due 06/01/2009 3,800 1,349 12.125% due 12/01/2009 5,000 1,575 Young Broadcasting, Inc. 9.000% due 01/15/2006 14,690 13,919 8.750% due 06/15/2007 127 117 10.000% due 03/01/2011 13,400 13,065 ------------ 1,577,388 ------------ Utilities 9.4% AES Corp. 8.750% due 12/15/2002 3,000 3,060 10.250% due 07/15/2006 2,299 2,397 8.500% due 11/01/2007 6,152 6,106 9.500% due 06/01/2009 16,944 17,961 9.375% due 09/15/2010 15 16 American Tower Corp. 9.375% due 02/01/2009 13,000 12,513 AT&T Canada, Inc. 0.000% due 06/15/2008 (c) 28,344 23,592 10.625% due 11/01/2008 7,572 8,403 AT&T Wireless Services, Inc. 7.875% due 03/01/2011 16,750 16,732 Azurix Corp. 10.375% due 02/15/2007 9,644 9,933 Calpine Corp. 9.250% due 02/01/2004 10,254 10,259 7.625% due 04/15/2006 3,550 3,568 8.750% due 07/15/2007 19,241 19,774 7.875% due 04/01/2008 5,748 5,756 7.750% due 04/15/2009 789 780 8.500% due 02/15/2011 6,700 6,893 Carolina Power & Light Energy, Inc. 6.117% due 07/29/2002 (d) 2,288 2,293 Chesapeake Energy Corp. 9.625% due 05/01/2005 3,000 3,285 CMS Energy Corp. 8.125% due 05/15/2002 3,579 3,625 6.750% due 01/15/2004 592 578 7.000% due 01/15/2005 7,887 7,565 9.875% due 10/15/2007 6,113 6,548 8.500% due 04/15/2011 9,000 8,756 France Telecom 7.750% due 03/01/2011 19,750 19,902 Giant Industries, Inc. 9.750% due 11/15/2003 150 149 9.000% due 09/01/2007 1,750 1,654 Key Energy Services, Inc. 8.375% due 03/01/2008 2,770 2,853 Mastec, Inc. 7.750% due 02/01/2008 7,250 6,978 Progress Energy, Inc. 6.550% due 03/01/2004 9,070 9,266 7.100% due 03/01/2011 9,070 9,348 Rocky River Realty 8.810% due 04/14/2007 (b) 2,912 3,085 Williams Cos., Inc. 7.259% due 11/15/2001 (d) 4,812 4,819 Wilmington Trust Co. - Tucson Electric 10.210% due 01/01/2009 500 531 10.732% due 01/01/2013 7,015 7,840 ------------ 246,818 ------------ Total Corporate Bonds & Notes 1,943,765 (Cost $2,093,227) ------------ -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 1.7% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 1.7% LTC Commercial Corp. 9.200% due 08/04/2023 2,235 2,421 7.970% due 04/15/2028 3,993 3,750 NationsBanc Mortgage Capital Corp. 8.035% due 05/25/2028 3,035 2,664 Red Mountain Funding Corp. 9.150% due 11/28/2027 4,517 3,075 Resolution Trust Corp. 6.900% due 02/25/2027 3,693 3,591 7.000% due 05/25/2027 4,417 4,412 Sasco Floating Rate Commercial Mortgage Trust 5.600% due 04/25/2003 (d) 23,504 23,379 ------------ 43,292 ------------ Stripped Mortgage-Backed Securities 0.0% Fannie Mae (IO) 7.000% due 07/25/2008 1,366 163 6.500% due 06/25/2017 32 0 7.000% due 04/25/2019 5,965 243 7.000% due 12/25/2021 2,107 230 ------------ 636 ------------ Total Mortgage-Backed Securities 43,928 (Cost $43,762) ------------ -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 10.1% -------------------------------------------------------------------------------- Acterna LLC 9.688% due 09/01/2007 1,476 1,466 Adelphia Communications Corp. 9.190% due 10/01/2002 3,000 3,000 9.300% due 02/15/2004 7,000 6,999 Airplanes Pass Through Trust 10.875% due 03/15/2019 22,490 14,828 Airtrust 0.990% due 06/01/2013 8,912 3,347 Allied Waste Industries, Inc. 7.687% due 07/30/2006 1,824 1,807 7.812% due 07/30/2006 8,056 7,982 8.062% due 07/21/2007 912 904 8.125% due 07/30/2007 (d) 2,280 2,259 9.625% due 07/30/2007 (d) 3,191 3,163 9.687% due 07/30/2007 (d) 4,559 4,518 9.812% due 07/30/2007 (d) 2 2 Allied Waste North America, Inc. 7.937% due 07/30/2007 912 911 Bergen Brunswig Corp. 7.650% due 03/31/2005 3,397 3,386 7.912% due 03/31/2005 394 393 8.133% due 03/31/2005 849 847 8.207% due 03/31/2005 1,699 1,693 9.120% due 03/31/2005 4,246 4,233 9.200% due 03/31/2005 4,246 4,233 9.331% due 03/31/2005 4,246 4,233 7.650% due 03/31/2006 2,548 2,561 Charter Commercial Holdings LLC 8.150% due 03/31/2008 15,500 15,382 Conseco Finance 9.300% due 10/15/2030 8,000 8,464 Continental Airlines, Inc. 6.792% due 07/30/2004 10,000 9,788 Crown Castle 8.130% due 03/31/2008 3,000 3,013 Da Vita 8.000% due 03/31/2003 4,176 4,169 8.750% due 03/13/2006 492 491 9.187% due 03/31/2006 2,463 2,458 Emmis Communications Corp. 8.312% due 08/31/2009 16,500 16,500 Flag Ltd. 7.312% due 03/31/2006 2,323 2,318 Global Crossing Holding Ltd. 8.030% due 08/15/2006 3,000 3,004 Green Tree Financial Corp. 8.000% due 07/15/2018 6,000 5,297 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 65 PIMCO Schedule of Investments A, B, and C Classes (Cont.) High Yield Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Huntsman Corp. 9.571% due 07/31/2004 $ 787 $ 754 7.750% due 06/30/2005 492 447 8.913% due 06/30/2005 688 626 9.375% due 06/30/2005 1,869 1,700 9.500% due 06/30/2005 138 125 9.571% due 06/30/2005 1,351 1,229 8.750% due 12/31/2005 3,000 2,876 Impress Metal 9.457% due 12/01/2006 1,015 1,016 Insight Midwest 8.187% due 12/15/2009 7,000 7,043 Island Inland Co. 9.508% due 07/09/2003 4,000 3,100 Morgan Stanley Aircraft Finance 8.700% due 03/15/2023 17,782 11,878 Nextel Communications, Inc. 8.400% due 03/31/2008 17,169 16,722 Primedia, Inc. 7.955% due 07/31/2004 4,975 4,968 Rural Cellular Corp. 9.068% due 10/03/2009 3,819 3,752 Starwood Hotels & Resorts 7.757% due 02/23/2003 7,758 7,786 8.131% due 02/23/2003 6,743 6,767 Stone Container Corp. 8.812% due 04/01/2003 (d) 1,466 1,471 8.875% due 10/01/2003 1,466 1,471 8.812% due 10/01/2003 (d) 4,136 4,148 8.875% due 10/01/2003 4,129 4,142 8.812% due 10/01/2005 1,117 1,119 Total Renal Care 8.062% due 03/31/2003 878 872 8.437% due 03/31/2003 4,095 4,088 9.875% due 03/31/2003 7,324 7,274 Triad Hospitals, Inc. 9.240% due 12/31/2005 1,324 1,330 9.390% due 12/31/2005 5,523 5,547 VoiceStream 8.500% due 02/15/2009 4,500 4,466 8.190% due 06/30/2009 16,000 15,887 ------------ Total Asset-Backed Securities 266,253 (Cost $281,973) ------------ -------------------------------------------------------------------------------- SOVEREIGN ISSUES 0.2% -------------------------------------------------------------------------------- United Mexican States 8.500% due 02/01/2006 5,719 5,848 ------------ Total Sovereign Issues 5,848 (Cost $5,703) ------------ -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 1.9% -------------------------------------------------------------------------------- Health Care 0.7% Tenet Healthcare Corp. 6.000% due 12/01/2005 3,664 3,316 Total Renal Care Holdings 7.000% due 05/15/2009 15,953 13,959 ------------ 17,275 ------------ Industrial 1.0% Pride International, Inc. 0.010% due 04/24/2018 9,268 4,147 Waste Management, Inc. 4.000% due 02/01/2002 24,338 23,607 ------------ 27,754 ------------ Utilities 0.2% Nextel Communications, Inc. 5.250% due 01/15/2010 2,000 1,293 Rogers Communications, Inc. 2.000% due 11/26/2005 4,400 3,286 ------------ 4,579 ------------ Total Convertible Bonds & Notes 49,608 (Cost $48,033) ------------ Value Shares (000s) -------------------------------------------------------------------------------- PREFERRED STOCK 3.1% -------------------------------------------------------------------------------- CSC Holdings, Inc. 11.125% due 04/01/2008 161,572 $ 17,611 Fresenius Medical Care 9.000% due 12/01/2006 28,250 28,674 7.875% due 02/01/2008 26,750 26,015 Newscorp Overseas Ltd. 8.625% due 12/31/2049 105,100 2,512 Primedia, Inc. 9.200% due 11/01/2009 55,300 4,797 8.625% due 04/01/2010 39,500 3,308 ------------ Total Preferred Stock 82,917 (Cost $85,373) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 6.0% -------------------------------------------------------------------------------- Principal Amount (000s) Commercial Paper 5.7% Abbey National North America 5.425% due 04/19/2001 $ 400 399 American Express Credit Corp. 6.240% due 04/06/2001 500 500 CBA (de) Finance 4.960% due 04/23/2001 2,300 2,293 Coca-Cola Co. 5.140% due 04/12/2001 2,000 1,997 4.600% due 07/12/2001 4,000 3,944 Fannie Mae 4.685% due 09/06/2001 4,600 4,505 General Electric Capital Corp. 5.120% due 04/04/2001 1,700 1,700 4.600% due 07/18/2001 3,000 2,956 Gillette Co. 5.430% due 04/17/2001 1,500 1,497 4.910% due 08/21/2001 6,000 5,887 KFW International Finance, Inc. 5.320% due 05/30/2001 4,000 3,966 Monsanto Co. 4.980% due 08/15/2001 15,200 14,925 National Rural Utilities Cooperative Finance Corp. 5.300% due 05/24/2001 3,200 3,176 Reseau Ferre De France 4.590% due 07/25/2001 1,000 984 Swedbank, Inc. 5.290% due 05/30/2001 1,800 1,785 5.020% due 08/08/2001 3,400 3,341 UBS Finance, Inc. 5.400% due 04/02/2001 19,000 19,000 5.060% due 04/04/2001 4,500 4,499 5.390% due 05/30/2001 4,000 3,965 5.290% due 06/06/2001 4,900 4,855 5.920% due 06/06/2001 12,700 12,584 5.190% due 06/13/2001 8,600 8,514 5.290% due 06/13/2001 18,000 17,819 5.010% due 08/01/2001 20,500 20,164 5.040% due 08/02/2001 2,000 1,967 5.010% due 08/08/2001 3,500 3,440 ------------ 150,662 ------------ Repurchase Agreement 0.3% State Street Bank 4.600% due 04/02/2001 8,039 8,039 (Dated 03/30/2001. Collateralized by Freddie Mac 7.000% due 03/15/2010 valued at $8,205. Repurchase proceeds are $8,042.) ------------ Total Short-Term Instruments 158,700 (Cost $158,649) ------------ Total Investments (a) 96.6% $ 2,551,020 (Cost $2,716,720) Other Assets and Liabilities (Net) 3.4% 91,122 ------------ Net Assets 100.0% $ 2,642,142 ------------ 66 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes -------------------------------------------------------------------------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $2,721,008 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 31,646 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (201,634) ------------ Unrealized depreciation-net $ (169,988) ------------ (b) Restricted security. (c) Security becomes interest bearing at a future date. (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Security is in default. (f) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy C$ 2,539 05/2001 $ (10) Sell 2,539 05/2001 4 Buy EC 2,870 04/2001 (9) Sell 2,870 04/2001 152 Sell 2,870 06/2001 9 ------------ $ 146 ------------ (g) Principal amount denoted in indicated currency: C$ - Canadian Dollar EC - Euro (h) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount Appreciation -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 2.500% and the Fund will pay to the counterparty at par in the event of default of CMS Energy Corp. Bond with maximum maturity date of 12/01/2009. Broker: Morgan Stanley Exp. 06/26/2001 $ 13,750 $ 38 ------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 67 PIMCO Schedule of Investments A, B, and C Classes Long-Term U.S. Government Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 6.6% -------------------------------------------------------------------------------- Banking & Finance 3.9% Associates Corp. of North America 5.800% due 04/20/2004 $ 2,500 $ 2,526 Bank One Corp. 5.462% due 05/07/2002 (d) 2,400 2,401 Countrywide Home Loans 6.850% due 06/15/2004 1,500 1,550 Ford Motor Credit Co. 6.985% due 06/02/2003 (d) 1,900 1,897 Goldman Sachs Group, Inc. 7.338% due 01/14/2002 (d) 3,000 3,015 Morgan Stanley, Dean Witter & Co. 7.010% due 04/22/2004 (d) 2,500 2,502 National Rural Utilities Cooperative Finance Corp. 5.721% due 08/13/2002 (d) 5,000 5,001 ------------ 18,892 ------------ Industrials 1.7% DaimlerChrysler North America Holding Corp. 7.750% due 05/27/2003 5,000 5,174 7.001% due 08/16/2004 (d) 3,000 2,924 ------------ Utilities 1.0% Pacific Gas & Electric Co. 7.375% due 11/01/2005 (h) 3,000 2,295 Scana Corp. 7.448% due 07/15/2002 (d) 2,000 2,004 WorldCom, Inc. 6.980% due 11/26/2001 (d) 700 698 ------------ 4,997 ------------ Total Corporate Bonds & Notes 31,987 (Cost $32,578) ------------ -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.9% -------------------------------------------------------------------------------- California 0.9% Kern County California Pension Obligation Revenue Bonds, (MBIA Insured), Series 1995 7.260% due 08/15/2014 3,900 4,205 ------------ Total Municipal Bonds & Notes 4,205 (Cost $4,074) ------------ -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 12.9% -------------------------------------------------------------------------------- Fannie Mae 6.850% due 11/06/2003 4,000 4,055 6.470% due 04/15/2009 1,000 1,010 0.000% due 01/15/2010 16,800 18,568 7.125% due 06/15/2010 3,500 3,852 7.125% due 01/15/2030 580 646 Federal Farm Credit Bank 6.000% due 03/07/2011 20,000 20,205 Federal Home Loan Bank 5.950% due 12/10/2008 250 248 6.410% due 09/30/2013 500 492 6.650% due 10/21/2013 300 298 Resolution Funding Corporation Principle Strip 0.000% due 01/15/2030 5,000 910 SallieMae 6.694% due 01/25/2007 (d) 498 499 Tennessee Valley Authority 7.125% due 05/01/2030 10,000 11,074 ------------ Total U.S. Government Agencies 61,857 (Cost $60,000) ------------ -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 60.4% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (f) 3.625% due 07/15/2002 (b) 12,026 12,263 3.625% due 01/15/2008 (g) 16,251 16,632 3.625% due 04/15/2028 3,248 3,312 3.875% due 04/15/2029 2,130 2,274 U.S. Treasury Bonds 14.000% due 11/15/2011 (g) 10,000 14,435 9.250% due 02/15/2016 9,800 13,538 8.875% due 08/15/2017 5,200 7,060 8.750% due 08/15/2020 (g) 52,800 72,436 8.125% due 05/15/2021 5,600 7,291 7.125% due 02/15/2023 (g) 4,000 4,751 6.250% due 08/15/2023 (g) 13,600 14,665 6.000% due 02/15/2026 (g) 7,700 8,076 5.500% due 08/15/2028 (g) 35,000 34,404 U.S. Treasury Notes 4.250% due 11/15/2003 (g) 21,250 20,719 U.S. Treasury Strips 0.000% due 05/15/2013 12,200 6,389 0.000% due 02/15/2019 26,600 9,524 0.000% due 05/15/2020 (g) 129,300 42,857 ------------ Total U.S. Treasury Obligations 290,626 (Cost $283,590) ------------ -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 56.7% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 29.1% Bank of America Mortgage Securities, Inc. 7.250% due 02/25/2031 2,000 1,999 Bear Stearns Mortgage Securities, Inc. 7.100% due 06/25/2024 385 382 7.512% due 06/25/2030 (d) 796 796 California Federal Bank 7.299% due 08/25/2030 (d) 576 580 Chase Mortgage Finance Corp. 8.493% due 04/25/2025 (d) 969 989 Countrywide Funding Corp. 6.500% due 01/25/2009 564 568 7.000% due 05/25/2024 8,000 7,791 Discover Card Master Trust I 6.792% due 04/16/2010 966 1,006 Fannie Mae 6.250% due 12/25/2013 82 81 5.650% due 10/25/2017 (d) 2,970 2,991 7.000% due 02/25/2020 1,523 1,539 6.950% due 07/25/2020 1,264 1,284 6.750% due 06/25/2021 2,633 109 8.000% due 03/25/2022 5 5 7.000% due 04/25/2022 910 910 7.000% due 06/25/2022 438 439 7.800% due 10/25/2022 407 425 7.000% due 10/25/2022 1,697 1,681 7.000% due 05/25/2023 69 69 6.900% due 05/25/2023 681 672 7.000% due 05/25/2023 1,368 1,410 7.000% due 06/25/2023 584 602 7.000% due 07/25/2023 58 58 6.500% due 08/25/2023 839 802 6.000% due 08/25/2023 145 132 4.500% due 10/25/2023 285 180 6.500% due 11/25/2023 2,000 1,953 6.500% due 12/25/2023 3,978 3,775 7.000% due 12/25/2023 1,659 1,671 6.500% due 01/25/2024 1,577 1,529 6.500% due 02/25/2024 317 302 6.000% due 05/17/2027 2,500 2,254 7.000% due 05/18/2027 1,657 1,631 First Boston Mortgage Securities Corp. 7.300% due 07/25/2023 1,531 1,526 Freddie Mac 9.500% due 01/15/2005 21 21 8.000% due 02/15/2015 443 462 6.000% due 01/15/2019 4,464 4,107 4.250% due 12/15/2021 441 433 7.000% due 07/15/2022 1,148 1,149 7.000% due 05/15/2023 280 281 7.000% due 08/15/2023 348 347 7.000% due 09/15/2023 844 856 6.250% due 09/15/2023 5,000 5,027 7.410% due 10/25/2023 1,319 1,342 6.500% due 11/15/2023 5,488 5,150 6.000% due 11/15/2023 1,008 967 6.500% due 11/25/2023 652 602 6.250% due 12/15/2023 523 493 68 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 6.500% due 12/15/2023 $ 1,085 $ 1,049 7.000% due 01/15/2024 104 107 7.500% due 01/20/2024 1,283 1,291 6.500% due 02/15/2024 203 185 6.500% due 03/15/2024 1,192 1,166 6.500% due 12/15/2024 2,212 2,225 7.500% due 02/15/2025 1,522 1,546 6.500% due 11/15/2027 1,205 1,053 6.500% due 01/15/2028 4,911 4,725 6.500% due 03/15/2029 272 234 6.000% due 05/15/2029 112 97 7.000% due 10/15/2030 9,000 9,208 General Electric Capital Mortgage Services, Inc. 9.000% due 10/25/2023 201 205 6.500% due 11/25/2023 3,000 2,915 6.500% due 01/25/2024 4,765 4,386 6.500% due 03/25/2024 934 927 7.000% due 10/25/2027 547 548 6.650% due 05/25/2028 4,561 4,599 German American Capital Corp. 7.000% due 08/12/2010 3,000 3,170 Government National Mortgage Association 7.000% due 03/16/2029 287 259 Independent National Mortgage Corp. 9.329% due 01/25/2025 (d) 37 38 6.930% due 05/25/2026 388 388 Mellon Residential Funding Corp. 6.460% due 07/25/2029 (d) 867 869 Merrill Lynch Mortgage Investors, Inc. 6.050% due 10/15/2008 2,428 2,438 6.210% due 03/20/2017 98 98 Norwest Asset Securities Corp. 6.750% due 07/25/2028 3,000 2,981 6.750% due 10/25/2028 973 971 PNC Mortgage Securities Corp. 7.500% due 01/25/2015 1,591 1,613 7.500% due 02/25/2027 1,754 1,816 6.750% due 04/25/2028 3,000 3,039 6.012% due 12/25/2030 (d) 6,986 6,999 Prudential Home Mortgage Securities 6.950% due 09/25/2023 73 68 6.500% due 11/25/2023 102 97 6.500% due 01/25/2024 1,460 1,355 8.000% due 06/25/2024 594 620 Residential Accredit Loans, Inc. 7.000% due 02/25/2028 2,000 2,037 Residential Funding Mortgage Securities I 8.766% due 03/25/2025 (d) 45 47 7.750% due 09/25/2026 1,100 1,124 7.500% due 04/25/2027 1,872 1,916 7.500% due 11/25/2030 4,101 4,085 Resolution Trust Corp. 7.441% due 05/25/2029 (d) 644 659 6.530% due 09/25/2029 1,005 1,007 Vendee Mortgage Trust 6.500% due 06/15/2024 2,323 2,252 ------------ 139,790 ------------ Fannie Mae 8.1% 6.500% due 05/01/2003-07/01/2005 (e) 6,108 6,203 6.626% due 12/01/2027 (d) 2,135 2,211 7.000% due 03/01/2004-03/01/2009 (e) 14,115 14,451 7.326% due 02/01/2028 (d) 380 393 7.383% due 01/01/2026 (d) 720 760 7.477% due 05/01/2025 (d) 1,372 1,437 7.500% due 02/01/2004-10/01/2004 (e) 3,163 3,230 7.970% due 10/01/2024 (d) 1,552 1,603 8.059% due 04/01/2028 (d) 2,242 2,304 8.246% due 08/01/2026 (d) 182 183 8.306% due 11/01/2023 (d) 2,384 2,430 8.444% due 08/01/2026 (d) 333 337 8.500% due 04/01/2028 1,404 1,489 9.000% due 08/01/2021-06/01/2027 (e) 1,484 1,572 9.094% due 10/01/2024 (d) 73 75 ------------ 38,678 ------------ Federal Housing Administration 5.7% 6.896% due 07/01/2020 3,395 3,267 7.000% due 11/25/2019 4,000 3,859 7.400% due 12/18/2018 1,536 1,528 7.421% due 11/01/2019 102 101 7.430% due 08/01/2019-06/01/2024 (e) 18,890 18,784 ------------ 27,539 ------------ Freddie Mac 4.0% 6.381% due 01/01/2028 (d) 2,402 2,464 6.742% due 09/01/2027 (d) 3,209 3,279 6.925% due 01/01/2028 (d) 1,528 1,565 7.000% due 07/01/2002 964 977 7.318% due 02/01/2028 (d) 1,782 1,854 7.450% due 03/25/2022 1,566 1,564 7.500% due 06/01/2004-10/01/2004 (e) 2,565 2,590 7.960% due 05/01/2022 (d) 94 97 8.000% due 05/01/2004 2,914 2,949 8.302% due 10/01/2026 (d) 769 786 8.349% due 06/01/2022 (d) 52 53 9.032% due 12/01/2024 (d) 1,052 1,089 ------------ 19,267 ------------ Government National Mortgage Association 8.9% 6.500% due 05/20/2030 (d) 14,691 14,842 6.800% due 10/15/2030 1,992 1,975 7.125% due 10/20/2026 (d) 55 56 7.375% due 02/20/2017-01/20/2028 (d)(e) 12,256 12,429 7.625% due 12/20/2017-11/20/2027 (d)(e) 7,160 7,341 7.750% due 09/20/2017-09/20/2026 (d)(e) 6,195 6,343 ------------ 42,986 ------------ Stripped Mortgage-Backed Securities 0.9% Fannie Mae (IO) 1187.600% due 08/25/2006 2 8 6.500% due 02/25/2007 44 2 6.500% due 07/25/2007 335 10 1197.960% due 08/25/2007 5 109 1014.600% due 09/25/2007 3 56 6.500% due 08/25/2020 120 7 6.500% due 09/25/2021 339 32 7.000% due 12/25/2021 134 15 Fannie Mae (PO) 0.000% due 03/25/2009 2,975 2,328 0.000% due 09/25/2023 1,538 1,158 Freddie Mac (IO) 7.000% due 03/15/2003 753 47 6.500% due 11/15/2003 1,364 108 7.000% due 02/15/2006 22 0 6.500% due 10/15/2006 86 4 819.100% due 02/15/2007 3 43 7.500% due 06/15/2007 239 16 6.500% due 10/15/2007 633 40 6.000% due 10/15/2007 62 4 6.500% due 11/15/2008 649 86 7.000% due 12/15/2023 1,318 167 Norwest Asset Securities Corp. (IO) 7.250% due 02/25/2012 820 79 ------------ 4,319 ------------ Total Mortgage-Backed Securities 272,579 (Cost $267,765) ------------ -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 5.5% -------------------------------------------------------------------------------- Chase Credit Card Master Trust 6.777% due 05/15/2007 859 865 Chase Manhattan Corp 6.750% due 08/25/2028 1,850 1,793 CS First Boston Mortgage Securities Corp. 5.423% due 12/15/2030 (d) 3,842 3,846 Green Tree Floorplan Receivables Master Trust 5.187% due 11/15/2004 (d) 3,000 3,001 HPSC Equipment Receivables LLC 5.307% due 11/22/2007 (d) 9,534 9,533 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 69 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Long-Term U.S. Government Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Provident Bank Equipment Lease Trust 5.830% due 11/25/2011 (d) $ 4,330 $ 4,330 Residential Funding Mortgage Securities, Inc. 6.290% due 07/25/2013 502 501 SallieMae 6.464% due 07/25/2004 (d) 728 727 6.839% due 10/27/2025 (d) 1,963 1,939 ------------ Total Asset-Backed Securities 26,535 (Cost $26,522) ------------ -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 0.0% -------------------------------------------------------------------------------- U.S. Treasury Note June Futures (CBOT) Strike @ 107.00 Exp. 05/26/2001 15,000 44 Strike @ 112.00 Exp. 05/26/2001 50,000 8 Strike @ 110.00 Exp. 05/26/2001 15,000 33 ------------ Total Purchased Call Options 85 (Cost $104) ------------ -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- U.S. Treasury Bond June Futures (CBOT) Strike @ 93.00 Exp. 05/26/2001 100,000 16 U.S. Treasury Bond 9.250% due 02/15/2016 Strike @ 115.00 Exp. 05/01/2001 90,000 0 ------------ Total Purchased Put Options 16 (Cost $35) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 2.5% -------------------------------------------------------------------------------- Commercial Paper 1.5% Federal Home Loan Bank 4.675% due 09/07/2001 100 98 General Electric Capital Corp. 4.980% due 04/25/2001 2,500 2,492 National Rural Utilities Cooperative Finance Corp. 4.880% due 05/25/2001 4,500 4,468 ------------ 7,058 ------------ Repurchase Agreement 0.3% State Street Bank 4.600% due 04/02/2001 1,535 1,535 (Dated 03/30/2001. Collateralized by ------------ Freddie Mac 6.680% due 12/28/2001 valued at $1,569. Repurchase proceeds are $1,536.) U.S. Treasury Bills (b) 0.7% 3.450% due 05/17/2001 (e) 3,450 3,429 ------------ Total Short-Term Instruments 12,022 (Cost $12,022) ------------ Total Investments (a) 145.5% $ 699,912 (Cost $686,690) Written Options (c) (0.2%) (849) (Premiums $631) Other Assets and Liabilities (Net) (45.3%) (218,014) ------------ Net Assets 100.0% $ 481,049 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $686,690 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 15,737 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (2,515) ------------ Unrealized appreciation-net $ 13,222 ------------ (b) Securities with an aggregate market value of $8,111 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 30 Year Bond (06/2001) 1,085 $ (2,000) U.S. Treasury 5 Year Note (06/2001) 634 56 Municipal Bond (06/2001) 8 4 ------------ $ (1,940) ------------ (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Call - CBOT U.S. Treasury Bond June Futures Strike @ 108.00 Exp. 05/26/2001 200 $ 167 $ 75 Put - CBOT U.S. Treasury Bond June Futures Strike @ 103.00 Exp. 05/26/2001 490 97 475 Call - CBOT 5 Year June Futures Strike @ 106.00 Exp. 05/26/2001 150 88 91 Call - CBOT U.S. Treasury Note June Futures Strike @ 110.00 Exp. 05/26/2001 10 4 2 Put - CBOT U.S. Treasury Note June Futures Strike @ 102.00 Exp. 05/26/2001 10 2 1 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 150 91 82 Call - CBOT U.S. Treasury Bond June Futures Strike @ 109.00 Exp. 05/26/2001 490 181 123 Call - CBOT U.S. Treasury Bond June Futures Strike @ 112.00 Exp. 05/26/2001 3 1 0 ------------------------ $ 631 $ 849 ------------------------ (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Securities are grouped by coupon or range of coupons and represent a range of maturities. (f) Principal amount of the security is adjusted for inflation. (g) Subject to financing transaction. (h) Security is in default. 70 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes -------------------------------------------------------------------------------- (i) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR and pay a fixed rate equal to 6.826%. Broker: Morgan Stanley Exp. 10/26/2030 $ 4,110 $ (296) Receive floating rate based on 3-month LIBOR and pay a fixed rate equal to 6.778%. Broker: Goldman Sachs Exp. 02/15/2021 3,900 (258) Receive fixed rate equal to 0.230% and the Fund will pay to the counterparty at par in the event of default of Associates Corp. 6.000% due 04/15/2003. Broker: Warburg Dillon Read LLC Exp. 01/14/2003 3,000 0 ------------ $ (554) ------------ Fixed Unrealized Spread Notional Appreciation/ Type (%) Amount (Depreciation) -------------------------------------------------------------------------------- Receive On-The-Run 10-year Swap Spread and pay a fixed spread. The On-The-Run 10-year Swap Spread is the difference between the 10-year Swap Rate and the 10-year Treasury Rate. Broker: Bank of America Exp. 06/17/2002 1.3100 $ 53,750 $ (1,063) Receive a fixed spread and pay On-The-Run 10-year Swap Spread. The On-The-Run 10-year Swap Spread is the difference between the 10-year Swap Rate and the 10-year Treasury Rate. Broker: Bank of America Exp. 06/15/2001 1.0000 50,000 1,343 Receive the 10-year Swap Spread and pay a fixed spread. The 10-year Swap Spread is the difference between the 10-year Swap Rate and the 10-year Treasury Rate. Broker: Morgan Stanley Exp. 06/29/2015 1.3367 30,000 (508) Receive the 5-year Swap Spread and pay a fixed spread. The 5-year Swap Spread is the difference between the 5-year Swap Rate and the 5-year Treasury Rate. Broker: Goldman Sachs Exp. 05/15/2006 1.0500 10,000 77 ------------ $ (151) ------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 71 PIMCO Schedule of Investments A, B, and C Classes Low Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 46.8% -------------------------------------------------------------------------------- Banking & Finance 23.6% American General Finance 6.875% due 12/14/2001 $ 25,000 $ 25,373 Associates Corp. of North America 6.700% due 05/29/2001 400 401 5.400% due 08/27/2001 (d) 1,000 1,003 6.875% due 06/20/2002 20,000 20,420 6.950% due 08/01/2002 1,000 1,026 AT&T Capital Corp. 5.881% due 04/23/2002 (d) 10,000 10,024 Banco Nacional de Comercio Exterior 7.250% due 02/02/2004 1,800 1,814 Bank of America Corp. 7.200% due 09/15/2002 100 103 7.875% due 12/01/2002 100 104 6.625% due 06/15/2004 1,000 1,032 Bank One Corp. 7.250% due 08/01/2002 500 514 Bear Stearns Co., Inc. 4.370% due 06/28/2001 (d) 2,000 2,003 5.370% due 12/16/2002 (d) 2,800 2,805 6.125% due 02/01/2003 3,000 3,026 5.210% due 03/28/2003 (d) 8,600 8,597 6.200% due 03/30/2003 9,700 9,795 7.156% due 06/01/2004 (d) 3,000 2,965 Beaver Valley Funding Corp. 8.250% due 06/01/2003 3,311 3,401 Beneficial Corp. 5.409% due 01/09/2002 (d) 10,000 10,017 6.650% due 09/12/2002 5,000 5,090 6.575% due 12/16/2002 5,440 5,541 Capital One Bank 7.000% due 04/30/2001 300 300 5.820% due 06/23/2003 (d) 1,100 1,076 Case Credit Corp. 5.713% due 08/01/2001 (d) 4,750 4,604 Chrysler Financial Corp. LLC 5.120% due 08/08/2002 (d) 8,000 7,930 CIT Group, Inc. 5.190% due 09/13/2002 (d) 19,900 19,842 7.375% due 03/15/2003 1,000 1,033 Credit Asset Receivable 6.274% due 10/31/2003 30,349 30,461 Export-Import Bank Korea 6.500% due 02/10/2002 7,500 7,505 6.500% due 11/15/2006 6,700 6,827 7.100% due 03/15/2007 6,700 6,965 Finova Capital Corp. 6.316% due 04/08/2003 (d)(i) 1,000 820 5.193% due 06/18/2003 (d)(i) 6,000 4,920 Ford Motor Credit Co. 6.093% due 03/19/2002 (d) 18,857 18,818 5.939% due 07/16/2002 (d) 100 100 6.520% due 08/12/2002 13,000 13,223 6.000% due 01/14/2003 15,000 15,117 5.133% due 03/17/2003 (d) 3,000 2,978 6.125% due 04/28/2003 14,000 14,150 5.860% due 04/26/2004 (d) 19,000 18,841 7.500% due 03/15/2005 1,000 1,047 6.179% due 07/18/2005 (d) 400 394 General Motors Acceptance Corp. 7.125% due 05/01/2001 15,000 15,023 5.509% due 11/12/2002 (d) 17,400 17,417 5.609% due 11/12/2002 (d) 63,520 63,349 5.875% due 01/22/2003 500 503 6.750% due 03/15/2003 3,700 3,788 6.394% due 07/20/2003 (d) 7,822 7,814 5.550% due 09/15/2003 3,000 2,996 5.750% due 11/10/2003 5,000 5,011 6.396% due 01/20/2004 (d) 9,400 9,399 5.750% due 03/22/2004 (d) 5,000 5,000 6.536% due 04/05/2004 (d) 700 690 7.625% due 06/15/2004 1,000 1,051 6.850% due 06/17/2004 1,000 1,028 Gold Eagle Capital Ltd. 8.629% due 04/15/2001 (d) 20,000 20,006 Great Western Financial 8.600% due 02/01/2002 4,000 4,104 Heller Financial, Inc. 5.979% due 10/22/2001 (d) 1,000 1,001 5.858% due 04/28/2003 (d) 20,000 19,944 Hitachi Credit America 6.100% due 04/24/2001 25,000 25,013 Household Finance Corp. 6.490% due 04/09/2001 20,000 20,004 6.125% due 07/15/2002 11,000 11,090 7.625% due 01/15/2003 10,849 11,260 6.125% due 02/27/2003 1,500 1,513 5.116% due 06/24/2003 (d) 1,500 1,495 Industrial Bank of Korea 8.375% due 09/30/2002 5,000 5,177 Key Bank NA 6.052% due 04/24/2003 12,900 12,988 KFW International Finance, Inc. 5.000% due 01/22/2002 7,690 7,700 5.500% due 02/19/2002 7,887 7,936 5.375% due 05/10/2002 12,282 12,360 6.125% due 07/08/2002 18,589 18,890 Korea Development Bank 7.125% due 09/17/2001 28,963 29,154 7.900% due 02/01/2002 6,100 6,191 7.625% due 10/01/2002 21,200 21,742 6.500% due 11/15/2002 5,898 5,957 8.294% due 06/16/2003 (d) 3,500 3,430 6.625% due 11/21/2003 20,300 20,549 Lehman Brothers Holdings, Inc. 6.110% due 05/07/2002 (d) 5,000 5,027 6.186% due 07/08/2002 (d) 1,500 1,501 5.610% due 12/12/2002 (d) 1,500 1,506 5.240% due 04/04/2003 (d) 7,900 7,912 Marsh & McLennan Cos., Inc. 6.625% due 06/15/2004 1,000 1,033 Merrill Lynch & Co. 5.945% due 11/26/2001 (d) 80,600 80,825 5.779% due 01/15/2002 (d) 5,000 5,003 7.129% due 02/08/2002 (d) 25,000 25,078 6.130% due 04/07/2003 7,770 7,926 Metropolitan Life Insurance Co. 6.300% due 11/01/2003 17,850 18,140 Middletown Trust 11.750% due 07/15/2010 911 952 Midland Funding I 10.330% due 07/23/2002 1,335 1,388 Morgan Stanley Group, Inc. 5.228% due 03/11/2003 (d) 5,000 5,000 Nacional Financiera 10.625% due 11/22/2001 7,500 7,714 7.284% due 05/08/2003 (d) 7,000 7,180 Pemex Finance Ltd. 6.125% due 11/15/2003 13,933 13,849 PNC Bank NA 5.150% due 01/24/2002 (d) 20,000 20,012 Popular North American, Inc. 6.875% due 06/15/2001 5,000 5,018 7.375% due 09/15/2001 20,000 20,211 Popular, Inc. 6.200% due 04/30/2001 1,000 1,001 Qwest Capital Funding, Inc. 6.125% due 07/15/2002 5,250 5,282 Rothmans Holdings 6.500% due 05/06/2003 14,000 14,146 Salomon, Inc. 7.250% due 05/01/2001 3,700 3,706 7.300% due 05/15/2002 15,000 15,400 7.500% due 02/01/2003 3,000 3,118 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (j) 1,104 1,110 5.568% due 05/14/2002 (d) 25,150 25,174 5.891% due 07/23/2002 (d) 5,100 5,099 72 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Seismic Ltd. 10.901% due 01/01/2002 (d) $ 10,000 $ 9,940 Shopping Center Associates 6.750% due 01/15/2004 11,725 11,920 Spieker Properties, Inc. 6.800% due 05/01/2004 2,000 2,040 Toyota Motor Credit Corp. 7.325% due 02/15/2002 (d) 11,600 11,620 Transamerica Finance Corp. 6.125% due 11/01/2001 5,000 5,032 Wachovia Corp. 6.075% due 05/02/2005 (d) 8,000 7,990 Wells Fargo & Co. 6.625% due 07/15/2004 1,000 1,037 6.025% due 05/02/2005 (d) 32,700 32,672 ------------ 1,084,140 ------------ Industrials 12.0% Allied Waste North America, Inc. 7.375% due 01/01/2004 5,000 4,925 AMR Corp. 9.125% due 10/24/2001 4,250 4,338 Atlas Air, Inc. 8.010% due 01/02/2010 9,778 9,932 Caterpillar, Inc. 9.750% due 06/01/2019 13,766 14,379 Cemex SA de CV 8.625% due 07/18/2003 10,000 10,300 Coastal Corp. 5.554% due 03/06/2002 (d) 32,200 32,200 Conoco, Inc. 5.900% due 04/15/2004 3,100 3,151 Cox Enterprises, Inc. 6.625% due 06/14/2002 3,000 3,035 6.425% due 05/01/2033 (d) 2,000 2,001 DaimlerChrysler North America Holding Corp. 5.790% due 12/16/2002 (d) 13,400 13,345 5.720% due 08/16/2004 (d) 1,000 975 6.900% due 09/01/2004 1,000 1,016 Delta Air Lines, Inc. 8.500% due 09/15/2001 205 208 6.650% due 03/15/2004 2,925 2,862 Eastman Chemical Co. 6.375% due 01/15/2004 250 244 Electric Lightwave, Inc. 6.050% due 05/15/2004 3,000 2,742 Enron Corp. 5.510% due 09/10/2001 (d) 1,000 1,001 8.000% due 08/15/2005 8,300 8,901 Federal-Mogul Corp. 7.500% due 07/01/2004 28,600 4,433 Ford Motor Co. 9.000% due 09/15/2001 500 508 Fred Meyer, Inc. 7.150% due 03/01/2003 13,500 13,999 General Motors Corp. 6.250% due 05/01/2005 7,000 7,065 Global Crossing Holding Ltd. 6.000% due 10/15/2013 7,500 7,110 HCA - The Healthcare Co. 8.130% due 08/04/2003 5,000 5,184 6.630% due 07/15/2045 7,000 7,071 HMH Properties, Inc. 7.875% due 08/01/2005 5,000 4,863 IMEXSA Export Trust 10.125% due 05/31/2003 5,718 5,564 International Game Technology 7.875% due 05/15/2004 500 508 Kroger Co. 6.340% due 06/01/2001 5,000 5,006 Lockheed Martin Corp. 6.850% due 05/15/2001 7,300 7,310 Nabisco, Inc. 6.700% due 06/15/2002 21,100 21,207 Occidental Petroleum Corp. 6.400% due 04/01/2003 15,945 16,057 Park Place Entertainment Corp. 7.950% due 08/01/2003 15,955 16,394 Petroleos Mexicanos 7.845% due 07/15/2005 (d) 10,400 10,426 7.769% due 07/15/2005 (d) 10,173 10,198 9.375% due 12/02/2008 5,500 5,734 Philip Morris Cos., Inc. 7.250% due 09/15/2001 500 504 7.500% due 01/15/2002 200 203 7.250% due 01/15/2003 4,050 4,174 8.250% due 10/15/2003 1,000 1,066 6.950% due 06/01/2006 25,000 25,031 Phillips Petroleum Co. 8.500% due 05/25/2005 2,000 2,201 Qwest Corp. 7.625% due 06/09/2003 25,000 25,930 5.650% due 11/01/2004 9,250 8,998 R & B Falcon Corp. 6.500% due 04/15/2003 11,000 11,094 Raytheon Co. 5.739% due 08/10/2001 (d) 500 501 Rollins Truck Leasing Co. 8.000% due 02/15/2003 3,000 3,143 Shoppers Food Warehouse Corp. 9.750% due 06/15/2004 10,500 10,978 Starwood Hotels & Resorts 6.750% due 11/15/2005 2,000 1,981 TCI Communications, Inc. 5.580% due 03/11/2003 (d) 3,000 3,018 Tenet Healthcare Corp. 7.875% due 01/15/2003 5,300 5,413 8.625% due 12/01/2003 9,700 10,078 Time Warner, Inc. 7.975% due 08/15/2004 1,950 2,080 TTX Co. 7.820% due 07/21/2003 61,000 64,243 Tyco International Group SA 6.875% due 09/05/2002 18,805 19,096 Union Oil Co. of California 9.100% due 08/15/2001 3,350 3,397 Waste Management, Inc. 6.500% due 05/15/2004 45,000 45,007 Yorkshire Power 6.154% due 02/25/2003 40,000 40,019 ------------ 552,347 ------------ Utilities 11.2% Arizona Public Service Co. 5.875% due 02/15/2004 5,600 5,599 Arkansas Power & Light 6.000% due 10/01/2003 450 450 BellSouth Telecommunications, Inc. 6.000% due 06/15/2002 3,000 3,036 British Telecommunications PLC 6.079% due 12/15/2003 (d) 9,900 9,904 7.625% due 12/15/2005 73,400 76,023 Calpine Corp. 9.250% due 02/01/2004 2,960 2,961 CenturyTel, Inc. 7.750% due 10/15/2012 32,000 32,590 Cinergy Corp. 6.125% due 04/15/2004 13,000 12,766 Cleveland Electric Illuminating Co. 8.550% due 11/15/2001 2,075 2,117 7.850% due 07/30/2002 3,500 3,609 9.500% due 05/15/2005 9,000 9,316 CMS Energy Corp. 8.125% due 05/15/2002 5,000 5,064 7.625% due 11/15/2004 15,400 15,295 8.000% due 07/01/2011 5,000 5,011 Connecticut Light & Power Co. 7.875% due 06/01/2001 500 502 8.590% due 06/05/2003 10,000 10,772 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 73 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Low Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- DTE Capital Corp. 8.350% due 11/15/2038 (d) $ 1,000 $ 1,021 Duke Energy Field Services 7.500% due 08/16/2005 1,000 1,053 Entergy Louisiana, Inc. 7.740% due 07/01/2002 3,308 3,314 8.500% due 06/01/2003 4,000 4,216 Entergy Mississippi, Inc. 7.750% due 02/15/2003 35,000 36,214 France Telecom 7.200% due 03/01/2006 29,300 29,818 Illinois Power Co. 6.250% due 07/15/2002 10,000 10,120 6.000% due 09/15/2003 12,500 12,634 Kentucky Power Co. 6.650% due 05/01/2003 1,000 1,002 Kinder Morgan, Inc. 6.450% due 11/30/2001 440 442 Niagara Mohawk Power Co. 7.125% due 07/01/2001 1,512 1,518 7.250% due 10/01/2002 16,634 16,988 Noram Energy Corp. 6.375% due 11/01/2003 2,000 2,043 Ohio Edison Co. 8.625% due 09/15/2003 5,000 5,339 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(i) 46,700 38,528 Scana Corp. 5.910% due 02/08/2002 (d) 1,000 1,001 Sprint Capital Corp. 9.500% due 04/01/2003 5,800 6,219 Texas Utilities Corp. 5.940% due 10/15/2001 13,155 13,217 6.500% due 08/16/2002 1,000 1,014 9.700% due 02/28/2003 4,695 5,075 6.750% due 03/01/2003 925 944 6.750% due 04/01/2003 3,875 3,958 6.875% due 08/01/2005 2,000 2,060 Toledo Edison Co. 8.180% due 07/30/2002 2,500 2,572 United Illuminating Co. 6.000% due 12/15/2003 13,000 13,137 Western Massachusetts Electric Co. 7.750% due 12/01/2002 4,847 4,853 Williams Cos., Inc. 5.889% due 11/15/2001 (d) 6,200 6,209 WorldCom, Inc. 6.125% due 08/15/2001 45,000 45,077 8.875% due 01/15/2006 45,170 46,653 6.125% due 04/15/2012 4,300 4,307 ------------ 515,561 ------------ Total Corporate Bonds & Notes 2,152,048 (Cost $2,154,130) ------------ -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 1.7% -------------------------------------------------------------------------------- Fannie Mae 4.625% due 10/15/2001 535 535 6.850% due 11/06/2003 30,000 30,415 7.125% due 09/19/2005 25,000 25,862 7.000% due 11/14/2005 15,085 15,613 Federal Home Loan Bank 6.240% due 08/24/2001 210 211 Freddie Mac 5.750% due 06/15/2001 750 752 6.500% due 02/04/2013 1,200 1,184 6.625% due 07/02/2013 1,195 1,184 Small Business Administration 8.250% due 01/25/2013 (d) 249 252 8.250% due 02/25/2014 (d) 705 708 ------------ Total U.S. Government Agencies 76,716 (Cost $75,476) ------------ -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 9.0% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (h) 3.625% due 07/15/2002 (b) 183,695 187,312 3.375% due 01/15/2007 (j) 50,333 50,884 3.625% due 01/15/2008 (j) 116,814 119,552 3.875% due 01/15/2009 (j) 55,935 58,173 U.S. Treasury Strips 0.000% due 02/15/2019 200 72 ------------ Total U.S. Treasury Obligations 415,993 (Cost $402,940) ------------ -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 108.2% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 25.4% Amortizing Residential Collateral Trust 5.790% due 09/25/2030 (d) 15,028 15,042 Bear Stearns Adjustable Rate Mortgage Trust 7.490% due 12/25/2030 (d) 17,118 17,297 7.499% due 12/25/2030 (d) 15,967 16,149 Cendant Mortgage Corp. 6.500% due 01/18/2016 455 456 Chase Commercial Mortgage Securities Corp. 7.600% due 12/18/2005 127 133 Chase Mortgage Finance Corp. 10.000% due 11/25/2009 12 12 6.500% due 06/25/2013 5,617 5,699 8.494% due 04/25/2025 (d) 1,487 1,518 6.750% due 07/25/2028 11,250 11,319 6.350% due 07/25/2029 4,186 4,243 Citicorp Mortgage Securities, Inc. 6.875% due 12/01/2019 (d) 375 373 6.750% due 05/25/2028 6,266 6,241 CMC Securities Corp. IV 7.250% due 10/25/2027 12,141 12,482 7.250% due 11/25/2027 10,106 10,389 Collateralized Mortgage Obligation Trust 7.375% due 01/20/2003 (d) 2 2 Commercial Trust 6.670% due 12/15/2003 (d) 3,267 3,134 Countrywide Funding Corp. 6.875% due 01/25/2035 (d) 1,906 1,901 Countrywide Home Loans 6.250% due 07/25/2009 208 208 6.900% due 12/25/2027 18,168 18,423 Criimi Mae Financial Corp. 7.000% due 01/01/2033 8,427 8,510 CS First Boston Mortgage Securities Corp. 6.960% due 01/20/2004 128 131 6.400% due 02/17/2004 119 121 7.500% due 02/25/2031 69,976 71,972 7.500% due 03/25/2031 29,978 30,273 Dime Savings 7.293% due 11/01/2018 (d) 1,143 1,058 DLJ Commercial Mortgage Corp. 7.571% due 09/05/2001 (d) 1,126 1,132 DLJ Mortgage Acceptance Corp. 11.000% due 08/01/2019 622 692 9.308% due 05/25/2024 (d) 826 838 5.978% due 06/25/2026 (d) 8,609 8,493 6.850% due 12/17/2027 165 171 Drexel Burnham Lambert Trust 6.063% due 05/01/2016 (d) 20 20 Enterprise Mortgage Acceptance Co. 6.110% due 07/15/2003 93 94 Fannie Mae 8.950% due 05/25/2003 13 13 9.000% due 07/25/2003 114 116 9.400% due 07/25/2003 30 30 6.875% due 06/25/2009 1,104 1,111 7.000% due 09/25/2016 10,368 10,505 9.250% due 10/25/2018 59 63 8.750% due 05/25/2019 9 9 74 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 9.500% due 03/25/2020 $ 3,880 $ 4,284 9.500% due 05/25/2020 1,115 1,187 6.000% due 12/25/2020 18 17 9.000% due 03/25/2021 2,810 2,969 9.000% due 04/25/2021 96 103 8.000% due 12/25/2021 1,869 1,987 8.000% due 03/25/2022 20 20 5.663% due 04/25/2022 (d) 171 173 5.000% due 01/25/2024 4 4 First Nationwide Trust 7.750% due 10/25/2030 68,388 70,922 Freddie Mac 8.000% due 07/01/2006 35 37 6.000% due 07/15/2006 963 964 6.500% due 08/15/2006 1,473 1,480 8.500% due 01/01/2007 56 59 8.000% due 09/15/2007 673 687 5.750% due 01/15/2008 3,789 3,801 9.500% due 07/01/2010 61 64 6.500% due 08/15/2011 16,492 16,733 8.000% due 01/01/2012 83 83 12.500% due 09/30/2013 487 539 11.750% due 02/01/2014 2 2 6.750% due 06/15/2019 2,603 2,606 10.000% due 07/15/2019 210 225 9.000% due 11/15/2019 367 371 10.000% due 05/15/2020 151 161 7.500% due 12/15/2020 727 732 9.000% due 12/15/2020 2,507 2,640 9.500% due 01/15/2021 861 911 6.500% due 02/15/2021 893 898 8.000% due 04/15/2021 1,025 1,067 9.000% due 05/15/2021 173 181 9.500% due 09/01/2021 29 31 8.000% due 04/01/2022 426 446 8.000% due 11/01/2022 284 297 7.500% due 01/20/2024 3,044 3,064 8.500% due 08/01/2024 110 116 8.500% due 11/01/2024 916 962 6.250% due 04/15/2028 8,260 8,297 6.500% due 10/01/2028 63 63 6.947% due 08/15/2032 (d) 5,259 5,390 General Electric Capital Mortgage Services, Inc. 6.750% due 12/25/2012 2,198 2,217 7.500% due 11/25/2030 30,208 30,816 German American Capital Corp. 7.000% due 08/12/2010 (d) 6,800 7,185 Glendale Federal Savings & Loan 11.000% due 03/01/2010 15 16 7.490% due 03/25/2030 (d) 869 865 GMAC Commercial Mortgage Corp. 6.030% due 02/20/2003 (d) 1,328 1,329 6.476% due 09/20/2005 (d) 200 200 Golden Mortgage Loan 7.875% due 02/25/2031 (d) 17,840 18,100 Government National Mortgage Association 8.000% due 05/20/2020 2,838 2,865 Greenwich Capital Acceptance, Inc. 9.687% due 11/25/2024 (d) 25 25 Guardian Savings & Loan Association 7.557% due 09/25/2018 (d) 28 28 Home Savings of America 6.480% due 05/25/2027 (d) 1,116 1,107 Impac Secured Assets CMN Owner Trust 8.000% due 07/25/2030 100,857 104,598 Imperial Savings Association 8.839% due 06/25/2017 (d) 29 29 9.900% due 02/25/2018 333 337 International Mortgage Acceptance Corp. 12.250% due 03/01/2014 88 102 LB Commercial Conduit Mortgage Trust 6.330% due 11/18/2004 109 112 Mellon Residential Funding Corp. 6.400% due 06/26/2028 16,661 16,758 6.580% due 07/25/2029 (d) 17,411 17,622 Morgan Stanley Capital I 8.287% due 07/15/2005 93 97 7.258% due 01/16/2006 218 229 7.460% due 02/15/2020 25,873 27,175 Morgan Stanley Dean Witter Capital I 6.950% due 10/15/2026 (d) 317 317 Mortgage Capital Funding, Inc. 6.325% due 10/18/2007 20,401 20,830 Nationslink Funding Corp. 6.297% due 12/10/2002 5,000 5,101 Nomura Asset Securities Corp. 6.625% due 01/25/2009 163 163 Norwest Asset Securities Corp. 6.500% due 04/25/2028 1,280 1,302 6.500% due 01/25/2029 6,000 5,981 PNC Mortgage Securities Corp. 6.500% due 02/25/2028 3,864 3,857 6.750% due 05/25/2028 4,271 4,307 7.750% due 07/25/2030 53,197 54,614 7.500% due 05/25/2040 (d) 267 270 PNC Mortgage Trust 8.250% due 03/25/2030 3,396 3,501 Prudential Home Mortgage Securities 7.500% due 10/25/2007 729 746 7.000% due 01/25/2008 10,000 10,118 6.750% due 11/25/2008 5,285 5,315 7.000% due 08/25/2009 4,000 4,070 7.000% due 06/25/2023 2,665 2,683 6.050% due 04/25/2024 87 87 7.300% due 06/25/2024 774 780 Prudential-Bache Trust 6.676% due 09/01/2018 (d) 20 20 8.400% due 03/20/2021 2,981 3,119 Resecuritization Mortgage Trust 5.306% due 04/26/2021 (d) 6,886 6,843 Residential Accredit Loans, Inc. 6.500% due 02/25/2029 (d) 22,057 22,013 7.000% due 07/25/2029 482 487 Residential Asset Securitization Trust 6.500% due 09/25/2014 420 422 Residential Funding Mortgage Securities I 6.500% due 04/25/2009 14 14 7.500% due 12/25/2025 937 971 7.250% due 10/25/2027 14,920 14,963 6.250% due 11/25/2028 6,000 5,756 7.500% due 11/25/2030 36,779 36,787 Residential Funding Mortgage Securities, Inc. 7.000% due 07/25/2012 254 254 6.405% due 07/25/2019 (d) 705 693 7.500% due 08/25/2023 412 415 7.100% due 07/25/2027 3,808 3,815 7.000% due 10/25/2027 10,000 10,204 Resolution Trust Corp. 7.014% due 05/25/2019 (d) 3,100 3,091 6.860% due 08/25/2019 (d) 2,437 2,438 10.320% due 08/25/2021 350 349 8.625% due 10/25/2021 9,165 9,140 4.725% due 10/25/2021 427 408 6.940% due 10/25/2021 (d) 52 52 6.900% due 02/25/2027 2,880 2,800 9.000% due 09/25/2028 121 121 7.380% due 10/25/2028 (d) 710 719 6.209% due 10/25/2028 (d) 1,589 1,654 7.477% due 05/25/2029 (d) 1,988 2,031 Ryland Mortgage Securities Corp. 7.297% due 11/25/2021 (d) 400 400 Salomon Brothers Mortgage Securities VII 7.567% due 12/25/2017 (d) 1,349 1,369 8.391% due 12/25/2017 (d) 115 117 8.950% due 03/25/2024 (d) 815 832 9.120% due 09/25/2024 (d) 194 198 7.600% due 08/25/2030 14,156 14,454 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 75 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Low Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Sasco Floating Rate Commercial Mortgage Trust 5.608% due 11/20/2001 (d) $ 1,254 $ 1,256 Sears Mortgage Securities 12.000% due 02/25/2014 52 54 7.431% due 10/25/2022 (d) 1,477 1,493 SLH Mortgage Trust 9.600% due 03/25/2021 216 215 Structured Asset Mortgage Investments, Inc. 6.902% due 06/25/2028 (d) 6,095 6,353 6.581% due 06/25/2029 (d) 29,054 29,515 9.030% due 06/25/2029 (d) 7,417 7,970 6.750% due 05/02/2030 3,819 3,771 Structured Asset Securities Corp. 6.750% due 07/25/2029 13,731 13,915 7.750% due 07/25/2030 26,348 27,057 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 9,071 9,071 Torrens Trust 5.424% due 07/15/2031 (d) 9,064 9,064 Union Planters Mortgage Finance Corp. 6.450% due 01/25/2028 6,000 6,025 Wells Fargo Mortgage-Backed Securities Trust 7.000% due 02/25/2016 154,405 158,204 ------------ 1,171,712 ------------ Fannie Mae 8.4% 6.000% due 05/01/2011 125 125 6.318% due 08/01/2029 18,057 18,296 6.500% due 09/01/2005-06/01/2008 (g) 696 708 6.748% due 11/01/2017 (d) 129 131 6.750% due 07/01/2017 (d) 329 333 6.758% due 04/01/2018 (d) 5,955 5,976 6.850% due 08/01/2017 (d) 37 37 6.857% due 12/01/2017-12/01/2023 (d)(g) 373 377 6.860% due 06/01/2017 (d) 70 71 7.000% due 04/01/2002-05/01/2012 (g) 266 272 7.282% due 01/01/2021 (d) 356 356 7.364% due 02/01/2028 (d) 5,087 5,274 7.434% due 07/25/2017 (d) 2,139 2,212 7.645% due 11/01/2017 (d) 277 279 7.766% due 11/01/2018 (d) 130 132 7.796% due 07/01/2017 (d) 435 443 8.000% due 03/01/2004-04/16/2031 (g) 325,049 335,205 8.290% due 10/01/2024 (d) 2,543 2,601 8.291% due 01/01/2024 (d) 103 106 8.351% due 04/01/2024 (d) 1,769 1,822 8.472% due 01/01/2024 (d) 28 29 8.484% due 01/01/2024 (d) 2,024 2,100 8.500% due 03/01/2008-01/01/2026 (g) 3,076 3,220 8.899% due 07/01/2023 (d) 1,245 1,268 9.000% due 01/01/2025 3 3 9.500% due 07/01/2024-11/01/2025 (g) 3,332 3,559 10.000% due 02/01/2004-01/01/2025 (g) 946 1,019 10.500% due 06/01/2005-12/01/2024 (g) 141 152 11.000% due 11/01/2020 39 43 11.250% due 12/01/2010-10/01/2015 (g) 100 112 11.500% due 12/01/2008-02/01/2020 (g) 54 60 11.750% due 02/01/2016 35 40 12.000% due 01/01/2015-10/01/2015 (g) 6 6 13.000% due 07/01/2015 5 6 13.250% due 09/01/2011 12 14 13.500% due 04/01/2014 3 4 15.500% due 10/01/2012-12/01/2012 (g) 51 62 15.750% due 12/01/2011 21 26 16.000% due 09/01/2012-12/01/2012 (g) 9 11 ------------ 386,490 ------------ Federal Housing Administration 1.2% 6.950% due 04/01/2014 2,029 2,068 7.400% due 02/01/2019 91 91 7.421% due 11/01/2019 447 445 7.430% due 10/01/2019-11/01/2025 (g) 53,446 53,253 ------------ 55,857 ------------ Freddie Mac 1.2% 6.000% due 09/01/2006-03/01/2011 (g) 8,960 9,076 6.500% due 02/01/2005 1 1 6.862% due 10/01/2027 (d) 1,006 1,037 7.000% due 05/14/2031 15,200 15,376 7.500% due 09/01/2006-03/01/2017 (d)(g) 241 242 7.625% due 01/01/2017 (d) 35 36 7.637% due 02/01/2020 (d) 2,007 2,038 8.000% due 03/01/2007-12/01/2024 (g) 3,792 3,950 8.250% due 10/01/2007-11/01/2007 (g) 22 23 8.337% due 11/01/2022 (d) 1,367 1,401 8.362% due 06/01/2024 (d) 548 563 8.365% due 11/01/2023 (d) 433 445 8.373% due 03/01/2024 (d) 64 66 8.376% due 10/01/2023 (d) 873 895 8.451% due 01/01/2024 (d) 1,599 1,645 8.500% due 07/01/2001-11/01/2025 (g) 10,498 11,008 8.511% due 07/01/2018 (d) 249 255 8.513% due 09/01/2023 (d) 221 227 8.535% due 12/01/2022 (d) 557 572 8.575% due 01/01/2024 (d) 694 720 8.750% due 04/01/2001-04/01/2002 (g) 14 14 9.000% due 05/01/2002-08/01/2022 (g) 2,725 2,891 9.250% due 07/01/2001 1 1 9.500% due 03/01/2001-02/01/2025 (g) 242 257 9.750% due 03/01/2001-11/01/2008 (g) 536 566 10.000% due 04/01/2015-10/01/2019 (g) 86 92 10.500% due 10/01/2010-02/01/2016 (g) 25 28 10.750% due 09/01/2009-08/01/2011 (g) 287 320 11.500% due 10/01/2015-01/01/2016 (g) 41 47 11.750% due 11/01/2010-08/01/2015 (g) 10 12 12.000% due 09/01/2013 2 2 14.000% due 09/01/2012-04/01/2016 (g) 10 10 14.500% due 12/01/2010 2 3 15.000% due 08/01/2011-12/01/2011 (g) 3 4 15.500% due 11/01/2011 0 0 16.000% due 04/01/2012 0 0 ------------ 53,823 ------------ Government National Mortgage Association 71.9% 6.375% due 05/20/2027 (d) 1,315 1,334 6.500% due 03/20/2023-04/23/2031 (d)(g) 111,439 111,415 7.000% due 03/15/2011-05/21/2031 (g) 452,672 459,180 7.125% due 11/20/2026 (d) 245 251 7.375% due 04/20/2016-06/20/2027 (d)(g) 36,190 36,731 7.500% due 02/15/2022-04/23/2031 (g) 1,309,585 1,342,645 7.625% due 10/20/2023-12/20/2027 (d)(g) 47,207 48,404 7.750% due 08/20/2022-07/20/2027 (d)(g) 64,425 65,942 8.000% due 07/15/2004-04/23/2031 (g) 1,060,864 1,094,119 8.500% due 12/15/2021-02/15/2031 (g) 111,934 116,268 9.000% due 06/20/2016-12/15/2030 (g) 31,879 33,309 9.500% due 10/15/2016-06/15/2025 (g) 105 112 9.750% due 07/15/2013-10/15/2017 (g) 424 459 10.000% due 10/15/2013-11/15/2025 (g) 105 116 10.500% due 11/15/2019-02/15/2021 (g) 15 17 11.000% due 09/15/2010 6 6 11.500% due 08/15/2018 33 37 11.750% due 08/15/2013-08/15/2015 (g) 46 53 12.000% due 06/20/2015 8 9 12.250% due 01/15/2014 36 41 13.000% due 10/15/2013 6 7 13.500% due 05/15/2011-11/15/2012 (g) 20 24 16.000% due 12/15/2011-02/15/2012 (g) 22 26 ------------ 3,310,505 ------------ Stripped Mortgage-Backed Securities 0.1% Fannie Mae (IO) 727.220% due 09/25/2006 20 80 6.000% due 02/25/2008 1,289 51 256.000% due 11/01/2008 19 78 6.500% due 03/25/2009 3,964 367 0.100% due 03/25/2009 (d) 13,512 214 7.500% due 03/25/2019 1,615 52 6.500% due 05/25/2019 6,869 390 76 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 6.500% due 04/25/2020 $ 3,777 $ 207 7.000% due 05/25/2021 2,596 169 859.770% due 02/25/2022 16 200 6.500% due 03/25/2023 2,493 278 4.875% due 03/25/2024 (d) 5,879 269 Fannie Mae (PO) 0.000% due 09/25/2022 23 21 Freddie Mac (IO) 6.000% due 02/15/2006 7 0 998.181% due 07/15/2006 3 7 1019.460% due 08/15/2006 2 5 1194.390% due 12/15/2006 4 16 6.000% due 10/15/2007 192 7 6.000% due 02/15/2008 844 24 7.000% due 08/15/2018 4,260 164 6.500% due 05/15/2019 2,763 125 6.500% due 06/15/2019 1,399 67 1049.620% due 04/15/2021 11 92 6.500% due 04/15/2022 2,055 197 7.000% due 05/15/2023 265 31 4.000% due 01/15/2024 20,919 3,194 Prudential Home Mortgage Securities (IO) 0.300% due 04/25/2009 (d) 44,034 243 ------------ 6,548 ------------ Total Mortgage-Backed Securities 4,984,935 (Cost $4,959,493) ------------ -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 4.9% -------------------------------------------------------------------------------- Advanta Equipment Receivables 6.640% due 09/16/2002 348 350 Advanta Mortgage Loan Trust 7.760% due 05/25/2018 22,700 23,735 Amresco Residential Securities Mortgage Loan Trust 5.720% due 07/25/2027 (d) 85 85 Bayview Financial Revolving Mortgage 6.350% due 08/25/2029 (d) 6,900 6,960 Bombardier Capital Mortgage 6.605% due 09/15/2010 6,943 6,982 Capital Asset Research Funding LP 6.400% due 12/15/2004 58 58 Cento 6.013% due 03/02/2002 278 280 CIT Marine Trust 5.800% due 04/15/2010 200 202 Comed Transitional Funding Trust 5.290% due 06/25/2003 1,918 1,919 Community Program Loan Trust 4.500% due 10/01/2018 15,367 14,516 Compucredit Credit Card Master Trust 5.789% due 03/15/2007 (d) 32,000 32,000 Conseco Finance 6.940% due 11/15/2014 543 548 Contimortgage Home Equity Loan Trust 6.770% due 01/25/2018 1,000 1,012 Duck Auto Grantor Trust 5.650% due 03/15/2004 2,952 2,962 Embarcadero Aircraft Securitization Trust 5.644% due 08/15/2025 (d) 4,900 4,900 EQCC Home Equity Loan Trust 6.780% due 10/15/2027 (d) 229 229 Equity One ABS, Inc. 7.325% due 02/25/2032 9,400 9,653 GF Funding Corp. 6.890% due 01/20/2006 16,142 16,306 Green Tree Financial Corp. 6.550% due 02/15/2027 10,135 10,340 7.400% due 06/15/2027 12,743 13,356 Green Tree Floorplan Receivables Master Trust 5.921% due 11/15/2004 (d) 1,000 1,000 Green Tree Home Improvement Loan Trust 6.320% due 08/15/2008 970 971 5.334% due 08/15/2029 (d) 599 598 IMC Home Equity Loan Trust 5.223% due 10/20/2027 (d) 3,305 3,307 Irwin Home Equity 7.460% due 11/25/2004 18,321 18,856 Marriott Vacation Club Owner Trust 5.930% due 09/20/2017 (d) 8,294 8,288 Merit Securities Corp. 7.040% due 12/28/2033 16,618 16,697 New York City Tax Lien 6.350% due 07/10/2007 4,850 4,728 Oakwood Mortgage Investors, Inc. 6.950% due 08/15/2027 2,951 2,966 Ocwen Mortgage Loan Asset Backed Certificates 6.060% due 10/25/2029 (d) 561 562 Option One Mortgage Loan Trust 5.340% due 09/25/2030 (d) 5,686 5,695 Pacificamerica Home Equity Loan 5.270% due 03/25/2028 (d) 252 251 Providian Gateway Master Trust 5.849% due 03/16/2009 (d) 8,000 8,000 SallieMae 6.824% due 07/25/2004 (d) 21 21 6.628% due 04/25/2006 (d) 6,531 6,521 Saxon Asset Securities Trust 7.205% due 01/25/2019 275 283 5.760% due 05/25/2029 (d) 1,189 1,190 Southern Pacific Secured Assets Corp. 5.700% due 07/25/2029 (d) 274 273 The Money Store Home Equity Trust 5.344% due 06/15/2029 (d) 533 533 ------------ Total Asset-Backed Securities 227,133 (Cost $223,446) ------------ -------------------------------------------------------------------------------- SOVEREIGN ISSUES 0.8% -------------------------------------------------------------------------------- Province of Quebec 6.625% due 10/25/2001 (d) 250 250 Republic of Brazil 7.625% due 04/15/2006 (d) 6,248 5,663 United Mexican States 5.820% due 06/28/2001 10,500 10,519 9.616% due 04/07/2004 (d) 21,530 22,123 ------------ Total Sovereign Issues 38,555 (Cost $38,123) ------------ -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES (e)(f) 1.5% -------------------------------------------------------------------------------- British Telecom PLC 4.726% due 07/27/2001 (d) EC 16,000 14,020 Korea Development Bank 4.885% due 05/14/2001 DM 340 152 2.700% due 08/16/2002 JY 2,000,000 15,991 Republic of Austria 5.500% due 01/15/2010 EC 8,900 8,082 Republic of Colombia 7.000% due 03/06/2002 IL 36,220,000 16,287 United Mexican States 6.000% due 03/28/2002 JY 960,000 8,013 8.750% due 05/30/2002 BP 3,000 4,328 ------------ Total Foreign Currency-Denominated Issues 66,873 (Cost $74,176) ------------ -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 0.0% -------------------------------------------------------------------------------- U.S. Treasury Bond 6.000% due 06/30/2001 Strike @ 93.000 Exp. 05/26/2001 $ 150 2 ------------ Total Purchased Call Options 2 (Cost $3) ------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 77 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Low Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Fannie Mae (OTC) 8.000% due 06/20/2031 Strike @ 93.734 Exp. 04/02/2001 $ 120,000 $ 0 Government National Mortgage Association (OTC) 8.000% due 06/20/2031 Strike @ 98.000 Exp. 06/13/2001 715,000 27 ------------ Total Purchased Put Options 27 (Cost $75) ------------ -------------------------------------------------------------------------------- PREFERRED STOCK 1.7% -------------------------------------------------------------------------------- Shares Home Ownership Funding 13.331% due 12/31/2049 3,000 2,265 Rhone-Poulenc SA 8.125% due 12/31/2049 13,000 327 SI Financing Trust I 9.500% due 06/30/2026 806,600 20,407 TCI Communications, Inc. 9.720% due 12/31/2036 224,700 5,719 8.720% due 01/31/2045 1,170,100 29,077 10.000% due 05/31/2045 800,300 20,088 ------------ Total Preferred Stock 77,883 (Cost $83,777) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 7.1% -------------------------------------------------------------------------------- Principal Amount (000s) Certificates of Deposit 0.1% Mexico Credit Link 11.384% due 02/22/2002 $ 5,000 5,127 ------------ Commercial Paper 6.7% Abbey National North America 5.070% due 08/06/2001 8,800 8,650 Fannie Mae 4.695% due 09/06/2001 83,800 82,060 Federal Home Loan Bank 4.675% due 09/07/2001 6,000 5,875 General Electric Capital Corp. 4.900% due 04/25/2001 33,000 32,897 Gillette Co. 4.910% due 08/21/2001 8,000 7,849 Glaxo Wellcome 4.970% due 04/30/2001 12,500 12,452 Halifax Building Society 4.600% due 08/02/2001 1,800 1,772 KFW International Finance, Inc. 4.840% due 08/08/2001 1,900 1,867 5.070% due 08/08/2001 3,700 3,636 Morgan Stanley Group, Inc. 5.050% due 04/11/2001 12,500 12,484 National Australia Funding 5.120% due 04/05/2001 12,500 12,495 National Rural Utilities Cooperative Finance Corp. 4.810% due 05/24/2001 4,000 3,972 4.910% due 05/25/2001 12,500 12,410 Swedbank, Inc. 4.930% due 04/25/2001 11,800 11,763 5.020% due 08/08/2001 200 197 4.900% due 08/23/2001 5,000 4,905 UBS Finance, Inc. 5.060% due 04/04/2001 28,800 28,792 5.030% due 08/07/2001 13,000 12,776 4.840% due 08/08/2001 9,500 9,336 5.010% due 08/08/2001 8,000 7,862 4.750% due 09/05/2001 17,000 16,649 4.740% due 09/12/2001 15,000 14,678 ------------ 305,377 ------------ -------------------------------------------------------------------------------- Repurchase Agreement 0.3% State Street Bank 4.600% due 04/02/2001 14,789 14,789 ------------ (Dated 03/30/2001. Collateralized by Federal Farm Credit Bank 5.875% due 07/02/2001 valued at $15,086. Repurchase proceeds are $14,795.) U.S. Treasury Bills 0.0% 5.151% due 05/17/2001 (b)(g) 330 328 ------------ Total Short-Term Instruments 325,621 (Cost $325,580) ------------ Total Investments (a) 181.7% $ 8,365,786 (Cost $8,337,219) Written Options (c) (0.0%) (2,050) (Premiums $1,822) Other Assets and Liabilities (Net) (81.7%) (3,760,447) ------------ Net Assets 100.0% $ 4,603,289 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $8,337,305 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 82,621 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (54,140) ------------ Unrealized appreciation-net $ 28,481 ------------ (b) Securities with an aggregate market value of $10,468 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 5 Year Note (06/2001) 99 $ (26) U.S. Treasury 10 Year Note (06/2001) 48 21 U.S. Treasury 30 Year Bond (06/2001) 61 (69) Euribor Futures (03/2002) 294 342 Eurodollar September Futures (09/2002) 122 (41) Eurodollar March Futures (03/2003) 122 (58) Eurodollar June Futures (06/2002) 122 (36) Eurodollar December Futures (12/2002) 122 (51) ------------ $ 82 ------------ (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/31/2001 18,500,000 $ 171 $ 336 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 27,800,000 270 506 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 06/04/2001 26,600,000 157 503 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 9,300,000 86 169 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/21/2001 19,200,000 588 264 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/27/2001 19,200,000 550 272 ------------------------- $ 1,822 $ 2,050 ------------------------- 78 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes -------------------------------------------------------------------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy EC 102,029 04/2001 $ (5,410) Sell 102,029 04/2001 541 Buy 86,029 06/2001 (325) Sell BP 2,588 05/2001 127 Buy JY 2,967,100 04/2001 (576) Sell 2,967,100 04/2001 1,332 Sell 2,967,100 06/2001 598 ------------ $ (3,713) ------------ (f) Principal amount denoted in indicated currency: BP - British Pound DM - German Mark EC - Euro IL - Italian Lira JY - Japanese Yen (g) Securities are grouped by coupon or range of coupons and represent a range of maturities. (h) Principal amount of the security is adjusted for inflation. (i) Security is in default. (j) Subject to financing transaction. (k) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive fixed rate equal to 6.0% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 06/15/2006 $ 2,900 $ 53 Receive fixed rate equal to 5.633% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/02/2004 BP 23,300 305 Receive fixed rate equal to 5.626% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Exp. 02/02/2004 77,600 997 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.805%. Broker: Morgan Stanley Exp. 01/11/2011 JY14,460,000 (5,083) Receive fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/02/2004 BP 175,100 1,585 Receive fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/02/2004 94,300 853 Receive fixed rate equal to 0.430% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 07/11/2003 20,000 1 Receive fixed rate equal to 0.230% and the Fund will pay to the counterparty at par in the event of default of Associates Corp. 6.000% due 04/15/2003. Broker: Warburg Dillon Read LLC Exp. 01/14/2003 43,000 1 Receive fixed rate equal to 0.510% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 01/25/2005 5,000 0 Receive fixed rate equal to 1.000% and the Fund will pay to the counterparty at par in the event of default of Enron Corp. 6.40% due 07/15/2006. Broker: Lehman Brothers Exp. 12/19/2001 25,000 0 Receive fixed rate equal to 1.25% and the Fund will pay to the counterparty at par in the event of default of MGM Mirage, Inc. Corporate Bond. Broker: Morgan Stanley Exp. 04/13/2001 20,000 0 ------------ $ (1,288) ------------ (l) Reverse repurchase agreements were entered into March 2, 2001 paying interest at 5.390%. The following security was segregated with collateral for reverse repurchase agreements: Type Maturity Value -------------------------------------------------------------------------------- Wells Fargo Mortgage-Backed Securities 02/25/2016 $ 158,204 ------------ (m) Short sales open at March 31, 2001 were as follows: Coupon Type (%) Maturity Par Value Proceeds -------------------------------------------------------------------------------- U.S. Treasury Notes 5.875 11/15/2004 137,080 $ 143,205 $ 142,647 U.S. Treasury Notes 6.000 08/15/2004 50,000 52,359 52,230 U.S. Treasury Notes 5.750 10/31/2002 123,200 126,138 125,874 U.S. Treasury Notes 6.750 05/15/2005 110,200 119,152 118,262 U.S. Treasury Notes 6.125 08/31/2002 16,400 16,833 16,748 U.S. Treasury Notes 5.750 11/15/2005 43,000 45,103 44,350 U.S. Treasury Notes 5.125 12/31/2002 103,400 104,927 104,470 U.S. Treasury Notes 4.250 11/15/2003 96,000 95,786 95,491 ------------------------ $ 703,503 $ 700,072 ------------------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 79 PIMCO Schedule of Investments A, B, and C Classes Money Market Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 32.0% -------------------------------------------------------------------------------- Banking & Finance 28.7% ABN AMRO Mortgage Corp. 5.010% due 04/02/2001 $ 4,700 $ 4,700 Bank of America Corp. 5.110% due 06/11/2001 (a) 1,000 1,000 6.538% due 09/26/2001 (a) 9,000 9,001 6.960% due 10/26/2001 (a) 1,550 1,551 Bayerische Landesbank Girozentrale 6.800% due 09/28/2001 1,000 1,009 Citigroup, Inc. 6.741% due 08/13/2001 (a) 235 235 First USA Bank 5.408% due 05/10/2001 (a) 10,900 10,900 First Chicago NBD Corp. 6.818% due 08/20/2001 (a) 14,300 14,304 General Electric Capital Corp. 5.770% due 08/27/2001 5,650 5,660 6.672% due 09/04/2001 (a) 5,100 5,100 6.350% due 09/15/2001 3,775 3,791 Goldman Sachs Group, Inc. 4.920% due 04/04/2001 11,900 11,897 5.777% due 01/28/2002 (a) 2,000 2,002 Merrill Lynch & Co. 5.400% due 04/11/2001 3,000 2,996 5.471% due 05/30/2001 (a) 2,000 2,000 5.478% due 08/10/2001 (a) 4,100 4,101 Morgan Stanley, Dean Witter & Co. 5.593% due 08/15/2001 (a) 6,000 6,000 National Rural Utilities Cooperative Finance Corp. 4.950% due 04/24/2001 3,700 3,689 5.240% due 05/24/2001 700 695 5.340% due 05/24/2001 9,700 9,625 ------------ 100,256 ------------ Industrials 3.3% Monsanto Co. 4.980% due 08/15/2001 300 294 Wal-Mart Stores, Inc. 6.150% due 08/10/2001 4,200 4,215 Walt Disney Co. 5.070% due 04/03/2001 6,900 6,899 ------------ 11,408 ------------ Total Corporate Bonds & Notes 111,664 (Cost $111,664) ------------ -------------------------------------------------------------------------------- SOVEREIGN ISSUES 1.7% -------------------------------------------------------------------------------- Republic of Ireland 7.875% due 12/01/2001 1,000 1,020 Republic of Italy 4.806% due 06/28/2001 (a) 5,000 5,004 ------------ Total Sovereign Issues 6,024 (Cost $6,024) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 66.6% -------------------------------------------------------------------------------- Certificates of Deposit 5.2% First Union National Bank 5.543% due 08/24/2001 (a) 18,300 18,312 ------------ Commercial Paper 61.0% Abbey National North America 4.920% due 04/26/2001 5,200 5,183 5.420% due 04/26/2001 3,700 3,687 5.020% due 08/08/2001 1,200 1,179 4.710% due 09/06/2001 4,500 4,408 Abbott Laboratories 5.100% due 04/03/2001 5,200 5,199 Alcoa, Inc. 5.400% due 04/25/2001 1,400 1,395 4.950% due 04/30/2001 11,600 11,555 5.120% due 05/23/2001 1,500 1,489 American Express Credit Corp. 4.990% due 04/06/2001 8,800 8,795 Anz, Inc. 5.520% due 04/18/2001 15,000 14,963 Bellsouth Corp. 5.340% due 04/11/2001 9,400 9,387 CBA (de) Finance 4.960% due 04/23/2001 9,600 9,572 5.310% due 06/05/2001 2,500 2,476 5.020% due 08/09/2001 3,200 3,142 Coca-Cola Co. 6.260% due 04/12/2001 4,800 4,792 5.120% due 04/12/2001 7,800 7,789 Federal Home Loan Bank 4.675% due 09/07/2001 18,900 18,512 Freddie Mac 5.130% due 04/03/2001 600 600 Gannett Co., Inc. 5.370% due 04/16/2001 3,500 3,493 General Electric Capital Corp. 5.410% due 04/04/2001 800 800 Gillette Co. 5.500% due 04/18/2001 8,700 8,679 H.J. Heinz Co. 5.000% due 04/20/2001 4,100 4,090 KFW International Finance, Inc. 5.400% due 04/18/2001 5,300 5,287 5.170% due 06/27/2001 1,800 1,778 5.000% due 08/08/2001 8,400 8,251 Merck & Co., Inc. 5.450% due 04/02/2001 6,100 6,100 National Australia Funding, Inc. 5.100% due 04/05/2001 15,000 14,994 Swedbank, Inc. 5.390% due 04/12/2001 1,700 1,697 6.260% due 04/12/2001 1,300 1,298 UBS Finance, Inc. 4.970% due 08/01/2001 6,700 6,588 5.010% due 08/01/2001 6,100 5,997 USAA Capital Corp. 4.970% due 04/18/2001 15,000 14,967 Verizon Global Funding Corp. 4.950% due 05/07/2001 14,500 14,430 ------------ 212,572 ------------ Repurchase Agreement 0.4% State Street Bank 4.600% due 04/02/2001 1,466 1,466 ------------ (Dated 03/30/2001. Collateralized by Freddie Mac 7.000% due 03/15/2010 valued at $1,501. Repurchase proceeds are $1,467.) Total Short-Term Instruments 232,350 (Cost $232,350) ------------ Total Investments 100.3% $ 350,038 (Cost $350,038) Other Assets and Liabilities (Net) (0.3%) (1,108) ------------ Net Assets 100.0% $ 348,930 ------------ (a) Variable rate security. The rate listed is as of March 31, 2001. 80 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes PIMCO Schedule of Investments A, B, and C Classes Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 105.2% -------------------------------------------------------------------------------- Arizona 4.1% Phoenix Industrial Development Authority Revenue Bonds, (GNMA/FNMA/FHLMC Insured), Series 2000-1A 5.875% due 06/01/2016 $ 1,000 $ 1,047 Pima County, Arizona Industrial Development Authority Multi-Family Revenue Bonds, (HUD SECT 8 Insured), Series 1998 5.375% due 06/01/2010 1,210 1,283 Scottsdale, Arizona Industrial Development Authority Hospital Revenue Bonds, (AMBAC Insured), Series 1997-A 6.500% due 09/01/2004 880 962 ------------ 3,292 ------------ California 12.2% Alameda, California Harbor Bay Business Park Assessment Revenue Bonds, Series 1998 5.000% due 09/02/2006 360 360 Capistrano, California Unified School District Special Tax Bonds, Series 1999 5.000% due 09/01/2008 350 356 Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, (MBIA-IBC), Series 1999 0.000% due 01/15/2026 (c) 1,565 1,054 Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, Series 1995 0.000% due 01/01/2026 (c) 1,000 272 Foothill Eastern Transportation Corridor Agency Toll Road Revenue Bonds, (MBIA Insured), Series 1999 0.000% due 01/15/2027 (c) 1,500 978 Irvine, California Special Assessment Bonds, (MBIA-IBC Insured), Series 1998 4.800% due 09/02/2004 150 151 4.900% due 09/02/2005 310 312 5.000% due 09/02/2006 150 151 Irvine, California Special Assessment Bonds, Series 1999 5.000% due 09/02/2005 350 352 5.100% due 09/02/2006 535 541 5.200% due 09/02/2007 255 258 Lake Elsinore, California School Refunding Bonds, Series 1998 5.000% due 09/01/2006 350 352 Los Angeles County, California Transportation Commission Sales Tax Revenue Refunding Bonds, Series 1991-B 6.500% due 07/01/2013 1,000 1,027 Los Angeles, California Community Redevelopment Agency Certificates of Participation Revenue Bonds, Series 1984 7.550% due 11/01/2008 1,075 1,199 Orange County, California Improvement Bonds, Series 1998-A 4.900% due 09/02/2005 245 246 Pittsburg, California Infrastructure Refunding Bonds, Series 1998-A 4.900% due 09/02/2003 150 154 5.000% due 09/02/2004 150 156 Riverside County, California Special Tax Refunding Bonds, Series 1999 4.200% due 09/01/2001 300 301 4.700% due 09/01/2005 170 171 Roseville, California Special Tax Bonds, Series 1999 5.000% due 09/01/2004 350 354 Sacramento County, California Refunding Bonds, Series 1998 4.900% due 09/02/2005 300 302 South Tahoe, California Joint Powers Financing Authority Revenue Bonds, Series 1999-A 7.300% due 10/01/2007 350 358 West Sacramento, California Refunding Bonds, Series 1998 5.000% due 09/02/2004 350 355 ------------ 9,760 ------------ Colorado 6.3% Arapahoe County, Colorado Capital Trust Fund Highway Revenue Bonds, (MBIA Insured), Series 1986 6.150% due 08/31/2026 1,500 1,607 Colorado Housing & Finance Authority Revenue Bonds, (FHA/VA Mortgages Insured), Series 2000-C3 5.700% due 10/01/2022 1,000 1,044 Colorado Housing & Finance Authority Revenue Bonds, Series 2000-D3 6.750% due 04/01/2015 250 280 Colorado Housing & Finance Authority Bonds, Series 2000-B3 6.700% due 10/01/2016 250 278 Colorado Housing & Financial Authority Revenue Bonds, Series 2000 5.150% due 08/01/2007 500 509 Denver, Colorado Health & Hospital Revenue Bonds, Series 1998-A 5.000% due 12/01/2009 1,390 1,310 ------------ 5,028 ------------ Florida 1.3% Gainesville, Florida Revenue Bonds, Series 1979 6.200% due 10/01/2002 210 213 Orange County, Florida Health Facilities Authority Revenue Bonds, (MBIA Insured), Series 1996 6.250% due 10/01/2011 290 335 Orlando, Florida Waste Water System Revenue Bonds, Series 1997-A 6.042% due 10/01/2015 (d) 500 477 ------------ 1,025 ------------ Georgia 0.3% Georgia Municipal Electric Authority Revenue Bonds, (MBIA-IBC Insured), Series 1997 6.500% due 01/01/2012 200 234 ------------ Hawaii 3.2% Hawaii State Housing Financial & Development Corporation Single Family Mortgage Pure Revenue Bonds, Series 1998 4.850% due 07/01/2029 1,500 1,509 Honolulu Hawaii City & County General Obligation Bonds, (MBIA-IBC), Series 1993 5.450% due 09/11/2008 1,000 1,085 ------------ 2,594 ------------ Illinois 8.7% Chicago, Illinois Board of Education General Obligation Bonds, (FGIC Insured), Series 1998 0.000% due 12/01/2020 1,000 352 Chicago, Illinois General Obligation Bonds, (MBIA Insured), Series 2001 0.000% due 01/01/2020 (c) 1,290 762 Chicago, Illinois Park District General Obligation Bonds, (FGIC Insured), Series 1999 4.750% due 01/01/2026 2,750 2,553 Fox Lake, Illinois Water & Sewer Revenue Bonds, (AMBAC Insured), Series 1996 5.750% due 05/01/2013 1,135 1,196 Illinois Educational Facilities Authority Revenues Bonds, Series 1993 5.610% due 07/01/2012 2,000 2,141 ------------ 7,004 ------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 81 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Indiana 2.5% Indianapolis, Indiana Local Public Improvement Bonds Bank Transportation Revenue Bonds, Series 1992 6.750% due 02/01/2014 $ 1,000 $ 1,179 South Bend, Indiana Redevelopment Authority Lease Revenue Bonds, Series 2000 5.200% due 02/01/2012 230 238 5.500% due 02/01/2015 180 187 5.100% due 02/01/2011 405 420 ------------ 2,024 ------------ Kentucky 7.1% Kentucky State Turnpike Authority Economic Development Road Revenue Bonds, Series 1993 7.294% due 06/06/2012 5,000 5,668 ------------ Louisiana 0.3% Louisiana Local Government Revenue Bonds, (MBIA Insured), Series 2000 5.700% due 01/01/2010 250 268 ------------ Massachusetts 3.2% Massachusetts Housing Finance Agency Revenue Bonds, (AMBAC Insured), Series 1993 5.950% due 10/01/2008 1,500 1,569 Massachusetts State Development Finance Agency Revenue Bonds, (ACA Insured), Series 1999 4.600% due 03/01/2009 400 393 Massachusetts State Development Finance Agency Revenue Bonds, Series 1998 4.700% due 11/01/2007 210 213 4.800% due 11/01/2008 90 91 Massachusetts State Health Facilities Authority Revenue Bonds, Series 1993 5.500% due 10/01/2002 270 265 ------------ 2,531 ------------ Michigan 2.3% Michigan State Environmental Protection General Obligation Bonds, Series 1992 6.250% due 11/01/2012 1,100 1,286 University of Michigan Revenue Bonds, Series 1995 3.750% due 12/01/2027 600 600 ------------ 1,886 ------------ Minnesota 1.3% New Richland, Minnesota Revenue Bonds, Series 1998 4.500% due 08/01/2004 1,000 1,017 ------------ Nevada 0.6% Nevada State General Obligation Bonds, (FGIC Insured), Series 2001 6.690% due 05/15/2028 500 467 ------------ New Hampshire 3.7% New Hampshire Health & Educational Facilities Authority Revenue Bonds, (AMBAC Insured), Series 2002 5.125% due 07/01/2016 2,980 2,969 ------------ New Jersey 20.7% New Jersey Economic Development Authority Revenue Bonds, Series 1998 5.600% due 01/01/2012 1,000 892 0.010% due 04/01/2013 1,595 744 6.375% due 04/01/2018 1,500 1,530 6.375% due 04/01/2031 7,000 7,089 New Jersey Economic Development Authority Revenue Bonds, Series 1999 6.625% due 09/15/2012 3,500 3,650 New Jersey State Highway Authority Gadern StreetParkway General Revenue Bonds, (FGIC Insured), Series 2001 5.500% due 01/01/2015 2,500 2,670 ------------ 16,575 ------------ -------------------------------------------------------------------------------- New Mexico 0.4% Santa Fe County, New Mexico El Castillo Retirement Nursing Home Bonds, Series 1998-A 5.250% due 05/15/2007 $ 315 $ 293 ------------ New York 2.6% Nassau County, New York Tobacco Settlement Corp. Revenue Bonds, Series 1999 5.250% due 07/15/2011 1,000 1,011 New York State Dormitory Authority Revenue Bonds, (ACA Insured), Series 2000 5.850% due 07/01/2010 1,000 1,047 ------------ 2,058 ------------ North Dakota 2.6% Mercer County North Dakota Pollution Control Revenue Bonds, Series 1991 6.900% due 02/01/2019 2,000 2,057 ------------ Pennsylvania 0.1% Delaware County, Pennsylvania Hospital Revenue Bonds, Series 1998 4.900% due 12/01/2008 100 93 ------------ Puerto Rico 1.2% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 5.750% due 07/01/2010 750 813 6.000% due 07/01/2026 150 156 ------------ 969 ------------ South Carolina 3.5% Medical University South Carolina Hospital Facilities Revenue Bonds, Series 1999 5.700% due 07/01/2012 1,000 1,022 South Carolina State Public Service Authority Revenue Bonds, Series 1993 6.838% due 06/28/2013 1,700 1,820 ------------ 2,842 ------------ Tennessee 2.3% Nashville & Davidson County, Tennessee Revenue Bonds, Series 1998 4.450% due 08/01/2007 1,000 1,014 Sullivan County, Tennessee Industrial Development Revenue Bonds, (GNMA Insured), Series 1995 6.250% due 07/20/2015 750 797 ------------ 1,811 ------------ Texas 12.0% Bexar, Texas Metro Water District Waterworks System Revenue Bonds, (MBIA Insured), Series 1998 0.000% due 05/01/2035 2,190 339 Brazos River Authority Texas Revenue Bonds, (MBIA Insured), Series 1998 4.900% due 10/01/2015 1,500 1,517 Dallas-Fort Worth International Airport Facility Improvement Corp. Revenue Bonds, Series 2000 5.950% due 05/01/2029 1,000 1,021 Del Rio Texas Waterworks & Sewer System Revenue Bonds, (MBIA Insured), Series 1993 5.500% due 06/01/2015 2,400 2,436 Houston Independent School District General Obligation Ltd Bonds, (PSF Insured), Series 1999 4.750% due 02/15/2026 1,000 915 Katy, Texas Independent School District General Obligation Ltd Bonds, (PSF-GTD Insured), Series 1998 4.750% due 02/15/2024 1,500 1,384 Lamar, Texas Independent School District General Obligation Bonds, (PSF-GTD Insured), Series 1998 4.750% due 02/15/2020 1,750 1,659 82 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Midlothian, Texas Independent School District General Obligation Bonds, (PSF-GTD Insured), Series 1999 0.010% due 02/15/2018 $ 1,000 $ 365 ------------ 9,636 ------------ Washington, DC 1.1% District of Columbia General Obligation Bonds, (LOC-Bank of America), Series 1991 3.850% due 06/01/2003 900 900 ------------ West Virginia 1.6% West Virginia State Parkways Economic Development & Tourism Authority Revenue Bonds, (FGIC Insured), Series 1993 7.839% due 05/16/2019 1,200 1,265 ------------ Total Municipal Bonds & Notes 84,266 (Cost $81,840) ------------ -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.1% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (b) 3.625% due 07/15/2002 109 111 ------------ Total U.S. Treasury Obligations 111 (Cost $109) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 0.6% -------------------------------------------------------------------------------- Money Market Fund 0.4% SSgA Tax Free Money Market 3.080% due 04/02/2001 334 334 U.S. Treasury Bills 0.2% 4.862% due 05/17/2001 140 139 ------------ Total Short-Term Instruments 473 (Cost $473) ------------ Total Investments (a) 105.9% $ 84,850 (Cost $82,422) Other Assets and Liabilities (Net) (5.9%) (4,714) ------------ Net Assets 100.0% $ 80,136 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $82,422 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 2,763 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (335) ------------ Unrealized appreciation-net $ 2,428 ------------ (b) Principal amount of the security is adjusted for inflation. (c) Security becomes interest bearing at a future date. (d) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 83 PIMCO Schedule of Investments A, B, and C Classes New York Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 90.0% -------------------------------------------------------------------------------- New Jersey 21.2% New Jersey Economic Development Authority Revenue Bonds, Series 1998 6.375% due 04/01/2031 $ 850 $ 861 ------------ New York 66.2% Amherst, New York General Obligation, (FGIC Insured), Series 1999-A 5.500% due 12/01/2008 150 164 Edmeston, New York Central School District General Obligation, (MBIA Insured), Series 1999 5.100% due 06/15/2007 150 160 Long Island Power Authority Revenue Bonds, Series 1998 3.750% due 05/01/2033 200 200 Nassau County, New York Individual Development Agency Civic Facilities Revenue Bonds, (LOC-Morgan Guaranty Trust), Series 1998 3.850% due 03/01/2028 (b) 100 100 Nassau County, New York Tobacco Settlement Corp. Revenue Bonds, Series 1999 5.250% due 07/15/2011 150 152 New York City, New York Individual Development Agency Special Facilities Revenue Bonds, Series 1998 5.250% due 12/01/2032 400 364 New York City, New York Individual Development Individual Development Revenue Bonds, Series 1997 5.650% due 10/01/2028 150 137 New York General Obligation, Series 1997-D 5.250% due 08/01/2021 100 101 New York State Dormitory Authority Revenue Bonds, (AMBAC Insured), Series 1998 5.000% due 07/01/2002 150 153 4.750% due 08/01/2027 150 138 New York State Dormitory Authority Revenue Bonds, (FSA Insured), Series 1998 4.750% due 07/01/2008 150 157 New York State Dormitory Authority Revenue Bonds, Series 2000 6.000% due 07/01/2010 150 162 New York State Local Government Assistance Corp. Revenue Bonds, (MBIA Insured), Series 1997-B 5.125% due 04/01/2013 150 156 New York State Power Authority Revenue & General Purpose, Series 1972-E 5.500% due 125 133 01/01/2010 New York State Urban Development Corp. Revenue Bonds, Series 1999 5.000% due 150 156 01/01/2005 Rockland County, New York Solid Waste Management Authority Revenue Bonds, Series 1999-A 4.800% due 12/15/2005 145 150 Suffolk County, New York Individual Development Agency Research Facility Revenue Bonds, (LOC-Morgan Guaranty Trust), Series 1993 3.950% due 07/01/2023 (b) 100 100 ------------ 2,683 ------------ Puerto Rico 2.6% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 6.000% due 07/01/2026 100 104 ------------ Total Municipal Bonds & Notes 3,648 (Cost $3,534) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 8.1% -------------------------------------------------------------------------------- Money Market Fund 7.7% Reich & Tang New York Money Market 2.900% due 04/02/2001 201 201 SSgA Tax Free Money Market 3.080% due 04/02/2001 109 109 ------------ 310 ------------ U.S. Treasury Bills 0.4% 4.890% due 05/17/2001 15 15 ------------ Total Short-Term Instruments 325 (Cost $325) ------------ Total Investments (a) 98.1% $ 3,973 (Cost $3,859) Other Assets and Liabilities (Net) 1.9% 79 ------------ Net Assets 100.0% $ 4,052 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $3,859 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 114 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. 0 ------------ Unrealized appreciation-net $ 114 ------------ (b) Variable rate security. The rate listed is as of March 31, 2001. 84 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes PIMCO Schedule of Investments A, B, and C Classes Real Return Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 35.7% -------------------------------------------------------------------------------- Banking & Finance 23.5% Allied Irish Banks 6.495% due 09/07/2006 (d) $ 1,200 $ 1,211 Allstate Financial Global Funding 7.125% due 09/26/2005 2,500 2,633 Associates Corp. of North America 5.400% due 08/27/2001 (d) 1,500 1,504 7.003% due 05/08/2003 (d) 1,500 1,503 AT&T Capital Corp. 7.110% due 09/13/2001 500 504 5.881% due 04/23/2002 (d) 1,000 1,002 Atlas Reinsurance PLC 9.071% due 04/04/2003 (d) 3,500 3,500 10.470% due 10/04/2004 (d) 4,400 4,400 Bear Stearns Co., Inc. 5.900% due 08/01/2002 (d) 500 500 5.270% due 09/21/2004 (d) 1,000 1,000 Chase Manhattan Corp. 5.360% due 12/10/2001 (d) 500 501 CIT Group, Inc. 6.750% due 05/14/2001 1,000 1,002 Citicorp 4.992% due 09/17/2001 (d) 335 335 Dime Bancorp, Inc. 7.000% due 07/25/2001 4,225 4,235 Donaldson, Lufkin & Jenrette, Inc. 7.210% due 04/25/2003 (d) 7,500 7,503 DQE Capital Corp. 7.233% due 01/15/2002 (d) 1,000 1,000 Export-Import Bank Korea 6.500% due 11/15/2006 2,500 2,547 Finova Capital Corp. 6.040% due 11/08/2002 (d) 2,800 2,299 First Union Corp. 7.550% due 08/18/2005 10,000 10,610 Florida Windstorm Underwriting Association 6.700% due 08/25/2004 500 511 Ford Motor Credit Co. 6.993% due 07/16/2002 (d) 1,000 1,000 6.885% due 02/13/2003 (d) 350 348 5.190% due 06/20/2003 (d) 18,500 18,484 General Motors Acceptance Corp. 5.273% due 12/09/2002 (d) 2,000 2,003 7.035% due 07/21/2003 (d) 3,500 3,505 Gold Eagle Capital Ltd. 11.078% due 04/15/2001 2,440 2,440 9.748% due 04/15/2001 1,000 1,000 Heller Financial, Inc. 6.893% due 04/26/2002 (d) 250 250 6.500% due 07/22/2002 1,000 1,015 7.500% due 08/23/2002 8,200 8,414 6.635% due 04/28/2003 (d) 3,000 2,992 Household Finance Corp. 5.772% due 08/06/2002 (d) 2,000 2,006 J.P. Morgan & Co., Inc. 6.654% due 02/15/2012 (d) 3,170 2,895 Juno RE Ltd. 10.367% due 06/26/2002 (d) 8,050 7,849 Korea Development Bank 5.885% due 03/01/2002 (d) 500 488 8.008% due 06/16/2003 (d) 500 490 Lehman Brothers Holdings, Inc. 5.388% due 06/03/2002 (d) 2,500 2,502 7.533% due 07/15/2002 (d) 600 604 7.015% due 09/03/2002 (d) 2,000 2,000 MBNA America Bank NA 6.560% due 04/25/2002 (d) 500 500 Merrill Lynch & Co. 6.791% due 11/01/2001 (d) 1,700 1,702 7.085% due 02/08/2002 (d) 400 401 6.768% due 02/04/2003 (d) 2,000 2,003 6.991% due 08/01/2003 (d) 4,000 4,011 Monumental Global Funding II 5.106% due 09/26/2003 (d) 2,000 2,001 Morgan Stanley, Dean Witter & Co. 6.883% due 04/15/2002 (d) 1,000 1,002 5.583% due 02/21/2003 (d) 1,500 1,502 6.767% due 03/13/2003 (d) 2,000 2,000 National Australia Bank Ltd. 6.035% due 05/19/2010 (d) 1,500 1,510 National Rural Utilities Cooperative Finance Corp. 6.880% due 05/31/2002 (d) 1,900 1,902 5.337% due 08/13/2002 (d) 10,000 10,002 National Westminster Bank PLC 5.520% due 09/16/2002 (d) 3,500 3,512 NeHi, Inc. 11.310% due 06/09/2003 (d) 3,000 3,030 Old Kent Bank 6.275% due 11/01/2005 (d) 1,000 999 Pemex Finance Ltd. 6.125% due 11/15/2003 367 364 Premium Asset Trust 7.078% due 11/27/2004 (d) 5,000 5,011 Protective Life Funding Trust 7.090% due 01/17/2003 (d) 1,000 1,002 Prudential Funding Corp. 5.968% due 10/18/2001 (d) 3,000 3,004 6.375% due 07/23/2006 2,000 2,026 PS Colorado Credit Corp. 7.398% due 05/30/2002 (d) 1,300 1,299 Qwest Capital Funding, Inc. 7.195% due 07/08/2002 (d) 1,000 1,001 Residential Reinsurance 10.836% due 06/01/2001 (d) 7,200 7,265 10.926% due 06/01/2001 (d) 9,000 9,000 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 17,433 17,528 6.962% due 04/28/2003 (d) 3,000 3,003 Seismic Ltd. 10.901% due 01/01/2002 (d) 2,500 2,485 Textron Financial Corp. 6.963% due 10/26/2001 (d) 2,500 2,504 7.033% due 09/17/2002 (d) 5,000 5,009 5.423% due 12/09/2002 (d) 1,000 1,002 Toyota Motor Credit Corp. 5.388% due 02/15/2002 (d) 400 401 Western Capital 10.665% due 01/07/2003 5,000 5,003 ------------ 211,569 ------------ Industrials 5.8% AIC Corp. 6.153% due 10/02/2002 (d) 250 250 Alpha Wind 11.321% due 05/23/2001 (d) 1,500 1,500 Coastal Corp. 7.330% due 07/21/2003 (d) 8,000 8,022 Cox Enterprises, Inc. 7.658% due 05/01/2033 (d) 2,000 2,001 DaimlerChrysler North America Holding Corp. 5.790% due 12/16/2002 (d) 2,000 1,992 7.078% due 08/16/2004 (d) 5,000 4,874 Delta Air Lines, Inc. 8.540% due 01/02/2007 3,734 3,825 Enron Corp. 5.510% due 09/10/2001 (d) 2,500 2,502 8.000% due 08/15/2005 3,000 3,217 Fred Meyer, Inc. 7.375% due 03/01/2005 2,000 2,095 Global Crossing Holding Ltd. 6.000% due 10/15/2013 1,250 1,185 HCA - The Healthcare Co. 6.442% due 09/19/2002 (d) 8,000 8,000 Petroleos Mexicanos 9.500% due 09/15/2027 4,750 4,976 Philip Morris Cos., Inc. 7.250% due 09/15/2001 1,000 1,007 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 85 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Real Return Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Raytheon Co. 7.020% due 08/10/2001 (d) $ 1,600 $ 1,602 Staples, Inc. 6.195% due 11/26/2001 (d) 2,000 2,002 United Air Lines, Inc. 5.272% due 12/02/2002 (d) 1,179 1,177 Waste Management, Inc. 7.100% due 08/01/2026 1,500 1,521 ------------ 51,748 ------------ Utilities 6.4% Allete 7.610% due 10/20/2003 (d) 2,500 2,503 Commonwealth Edison Co. 7.158% due 09/30/2002 (d) 1,000 1,001 Deutsche Telekom AG 7.750% due 06/15/2005 10,000 10,333 Dominion Resources, Inc. 7.230% due 09/16/2002 (d) 3,500 3,514 7.600% due 07/15/2003 5,000 5,206 Entergy Gulf States, Inc. 6.303% due 06/02/2003 (d) 4,500 4,506 Hawaiian Electric Industries, Inc. 7.783% due 04/15/2003 (d) 2,000 2,002 Oneok, Inc. 6.231% due 04/24/2002 (d) 2,000 2,003 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(i) 5,000 4,125 Public Service Enterprise Group, Inc. 5.408% due 06/15/2001 (d) 500 500 Scana Corp. 7.253% due 02/08/2002 (d) 1,900 1,902 7.393% due 07/15/2002 (d) 3,900 3,907 Sierra Pacific Resources 6.298% due 04/20/2002 (d) 1,000 850 7.340% due 04/20/2003 (d) 2,000 1,700 Sprint Capital Corp. 5.678% due 11/15/2001 (d) 1,000 1,001 5.410% due 06/10/2002 (d) 3,000 3,005 Texas Utilities Corp. 5.420% due 06/25/2001 (d) 1,300 1,300 5.781% due 09/24/2001 (d) 500 499 Vodafone Group PLC 5.080% due 12/19/2001 (d) 6,500 6,511 WorldCom, Inc. 7.375% due 01/15/2003 1,000 1,012 ------------ 57,380 ------------ Total Corporate Bonds & Notes 320,697 (Cost $319,838) ------------ -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.6% -------------------------------------------------------------------------------- Florida 0.4% Tampa, Florida Utility Tax & Special Revenue Bond, (AMBAC Insured), Series 2000 6.000% due 10/01/2004 3,580 3,853 ------------ New Mexico 0.0% New Mexico Mortgage Finance Authorities Revenue Bonds, (GNMA,FNMA, FHLMC Insured), Series 1997 7.000% due 07/01/2006 215 225 ------------ New York 0.0% New York City General Obligation Bonds 5.660% due 08/01/2002 (d) 76 76 ------------ Ohio 0.2% Hamilton, Ohio School Districts Gas Supply Revenue Bonds, Northern Ohio, (MBIA Insured), Series 1999 6.910% due 08/01/2001 1,500 1,512 ------------ Total Municipal Bonds & Notes 5,666 (Cost $5,510) ------------ -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 1.2% -------------------------------------------------------------------------------- Fannie Mae 5.440% due 03/13/2002 (d) 6,100 6,128 Federal Farm Credit Bank 2.868% due 02/14/2002 (d) 600 602 Federal Home Loan Bank 5.917% due 02/15/2002 (d) 2,485 2,497 SallieMae 6.779% due 10/25/2004 (d) 56 56 6.787% due 04/25/2006 (d) 1,245 1,243 6.694% due 01/25/2007 (d) 249 249 ------------ Total U.S. Government Agencies 10,775 (Cost $10,662) ------------ -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 107.8% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (g) 3.625% due 07/15/2002 (b)(c) 192,506 196,296 3.375% due 01/15/2007 (c) 166,955 168,782 3.625% due 01/15/2008 163,335 167,163 3.875% due 01/15/2009 (c) 151,184 157,231 3.625% due 04/15/2028 94,944 96,813 3.875% due 04/15/2029 (c) 170,847 182,379 ------------ Total U.S. Treasury Obligations 968,664 (Cost $935,531) ------------ -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 2.0% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 2.0% Bear Stearns Adjustable Rate Mortgage Trust 7.674% due 11/25/2030 (d) 4,754 4,775 CMC Securities Corp. 6.000% due 11/25/2008 207 207 Fannie Mae 5.462% due 10/25/2008 (d) 108 108 6.500% due 02/25/2029 126 105 Freddie Mac 7.000% due 07/15/2022 1,827 1,837 6.500% due 01/25/2028 100 98 7.000% due 10/15/2030 3,000 3,069 GMAC Commercial Mortgage Asset Corp. 5.307% due 07/20/2002 (d) 7,401 7,401 ------------ 17,600 ------------ Fannie Mae 0.0% 9.021% due 10/01/2024 (d) 410 424 ------------ Federal Housing Administration 0.0% 7.430% due 12/01/2020 296 296 ------------ Total Mortgage-Backed Securities 18,320 (Cost $18,228) ------------ -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 3.9% -------------------------------------------------------------------------------- AESOP Funding II LLC 5.830% due 11/20/2006 (d) 14,000 13,924 AFC Home Equity Loan Trust 5.270% due 03/25/2027 (d) 170 170 American Residential Eagle Trust 5.870% due 07/25/2029 (d) 5,453 5,466 Asset Backed Securities Corp. Home Equity 5.377% due 06/21/2029 (d) 4,451 4,465 Conseco Finance 7.890% due 07/15/2018 2,000 2,095 8.170% due 12/15/2025 2,000 2,103 Conseco Finance Home Loan Trust 8.880% due 06/15/2024 750 797 EQCC Home Equity Loan Trust 5.483% due 03/20/2029 (d) 165 165 IMC Home Equity Loan Trust 6.610% due 06/20/2013 28 28 MMCA Automobile Trust 6.300% due 06/15/2002 567 568 Onyx Acceptance Auto Trust 6.590% due 09/15/2002 187 188 6.350% due 10/15/2003 239 239 86 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SallieMae 6.481% due 07/25/2004 (d) $ 52 $ 52 USAA Auto Loan Grantor Trust 5.800% due 01/15/2005 177 178 Voicestream Vender Facility 9.620% due 06/30/2009 5,000 4,965 ------------ Total Asset-Backed Securities 35,406 (Cost $35,210) ------------ -------------------------------------------------------------------------------- SOVEREIGN ISSUES 0.0% -------------------------------------------------------------------------------- United Mexican States 0.000% due 06/30/2003 718 9 ------------ Total Sovereign Issues 9 (Cost $0) ------------ -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES (e)(f)1.1% -------------------------------------------------------------------------------- Caisse D'amort Dette Soc 3.800% due 07/25/2006 EC 5,084 4,553 Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 4,800 2,127 Newcourt Credit Group, Inc. 7.625% due 06/28/2001 C$ 500 318 Republic of France 3.000% due 07/25/2009 EC 2,553 2,177 United Mexican States 1.352% due 12/31/2019 (d) JY 70,000 547 ------------ Total Foreign Currency-Denominated Issues 9,722 (Cost $10,365) ------------ -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 0.4% -------------------------------------------------------------------------------- Industrial 0.4% Nabors Industries, Inc. 0.010% due 06/20/2020 $ 5,000 3,538 ------------ Total Convertible Bonds & Notes 3,538 (Cost $3,097) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 20.6% -------------------------------------------------------------------------------- Commercial Paper 20.5% Abbey National North America 5.240% due 04/10/2001 2,200 2,197 4.930% due 08/01/2001 7,100 6,983 American Express Credit Corp . 5.300% due 04/04/2001 5,000 4,999 6.250% due 04/06/2001 4,700 4,697 6.360% due 04/06/2001 600 600 Becton Dickinson & Co. 6.110% due 04/09/2001 600 599 Campbell Soup Co. 6.270% due 04/16/2001 300 299 Coca-Cola Co. 5.140% due 04/12/2001 2,000 1,997 Fannie Mae 4.700% due 05/16/2001 500 497 Federal Farm Credit Bank 4.630% due 08/29/2001 19,000 18,624 General Electric Capital Corp. 5.470% due 04/18/2001 700 699 4.900% due 04/25/2001 8,700 8,673 5.350% due 05/09/2001 9,000 8,951 4.870% due 05/30/2001 8,500 8,433 4.600% due 07/18/2001 1,600 1,577 Halifax PLC 5.300% due 06/06/2001 12,500 12,386 5.010% due 08/08/2001 900 884 KFW International Finance, Inc. 5.170% due 06/27/2001 19,000 18,778 5.010% due 08/08/2001 600 590 National Rural Utilities Cooperative Finance Corp. 5.130% due 04/17/2001 7,000 6,985 5.280% due 04/19/2001 4,300 4,289 4.880% due 05/25/2001 6,600 6,553 SBC Communications, Inc. 5.290% due 04/10/2001 6,400 6,392 Swedbank, Inc. 5.020% due 08/08/2001 4,600 4,521 UBS Finance, Inc. 5.470% due 04/09/2001 4,400 4,395 5.410% due 05/16/2001 600 596 5.290% due 06/13/2001 12,500 12,375 5.040% due 08/02/2001 2,500 2,459 5.070% due 08/08/2001 1,500 1,474 5.040% due 08/15/2001 2,800 2,749 4.750% due 09/05/2001 3,000 2,938 4.740% due 09/06/2001 8,600 8,422 Verizon Global Funding 5.010% due 05/16/2001 10,000 9,939 4.950% due 06/15/2001 3,500 3,464 Walt Disney Co. 4.900% due 08/07/2001 5,000 4,914 ------------ 184,928 ------------ Repurchase Agreement 0.1% State Street Bank 4.600% due 04/02/2001 673 673 (Dated 03/30/2001. Collateralized by Freddie Mac 6.680% due 12/28/2001 valued at $690. Repurchase proceeds are $673.) ------------ Total Short-Term Instruments 185,601 (Cost $185,577) ------------ Total Investments (a) 173.3% $ 1,558,398 (Cost $1,524,018) Other Assets and Liabilities (Net) (73.3%) (659,298) ------------ Net Assets 100.0% $ 899,122 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,524,669 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 36,825 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (3,096) ------------ Unrealized appreciation-net $ 33,729 ------------ (b) Securities with an aggregate market value of $889 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 2 Year Note (06/2001) 85 $ (88) United Kingdom 90 Day LIBOR Futures (09/2002) 38 (3) ------------ $ (91) ------------ (c) Subject to financing transaction. (d) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 87 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Real Return Bond Fund March 31, 2001 -------------------------------------------------------------------------------- (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Sell C$ 560 04/2001 $ 7 Buy EC 7,813 04/2001 (26) Sell 7,813 04/2001 372 Sell 7,813 06/2001 26 Sell JY 78,994 04/2001 35 Buy 78,994 04/2001 (15) Sell 78,994 06/2001 15 Sell N$ 5,169 04/2001 89 ------------ $ 503 ------------ (f) Principal amount denoted in indicated currency: C$ - Canadian Dollar EC - Euro JY - Japanese Yen N$ - New Zealand Dollar (g) Principal amount of security is adjusted for inflation. (h) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 0.470% and pay a fixed rate equal to 7.750%. Broker: Morgan Stanley Exp. 06/15/2005 $ 10,000 $ (735) Receive floating rate based on 3-month LIBOR plus 0.500% and pay a fixed rate equal to 7.600%. Broker: Lehman Brothers Exp. 07/15/2003 5,000 (235) Receive floating rate based on 3-month LIBOR plus 1.000% and pay to the counterparty the notional amount of $5,000 in exchange for shares of Nabors Industries, Inc. due 6/20/2020 when the convertible debentures mature. Broker: Morgan Stanley Exp. 06/20/2003 3,042 (116) Receive fixed rate equal to 0.410% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Goldman Sachs Exp. 11/10/2002 1,000 0 ------------ $ (1,086) ------------ (i) Security is in default. 88 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes PIMCO Schedule of Investments A, B, and C Classes Short-Term Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 63.1% -------------------------------------------------------------------------------- Banking & Finance 36.6% ABN AMRO Bank 6.625% due 10/31/2001 $ 2,000 $ 2,019 AT&T Capital Corp. 7.000% due 08/15/2001 2,300 2,313 Banco Nacional Obra Services 9.625% due 11/15/2003 3,900 4,115 Bank One Corp. 5.681% due 01/24/2002 (d) 2,000 2,002 BankBoston Corp. 6.125% due 03/15/2002 1,000 1,010 Bear Stearns Co., Inc. 5.270% due 09/21/2004 (d) 3,900 3,901 Chrysler Financial Corp. LLC 5.690% due 11/15/2001 1,200 1,204 CIT Group, Inc. 5.190% due 09/13/2002 (d) 6,300 6,282 Citigroup, Inc. 5.500% due 08/19/2003 (d) 11,040 11,273 DaimlerChrysler Financial Services North America LLC 5.250% due 10/22/2001 2,800 2,788 Dime Bancorp, Inc. 7.000% due 07/25/2001 2,400 2,406 Donaldson, Lufkin & Jenrette, Inc. 6.258% due 07/18/2003 (d) 8,000 8,024 DQE Capital Corp. 6.178% due 01/15/2002 (d) 2,000 2,001 Export-Import Bank Korea 6.500% due 02/10/2002 (d) 1,000 1,006 First USA Bank 5.458% due 05/15/2002 (d) 6,000 5,999 Ford Credit Canada 5.180% due 12/16/2002 (d) 10,000 9,990 Ford Motor Credit Co. 5.400% due 08/27/2006 (d) 6,840 6,840 5.092% due 03/19/2002 (d) 4,295 4,286 5.322% due 06/02/2003 (d) 2,500 2,497 6.178% due 07/18/2005 (d) 10,000 9,842 General Motors Acceptance Corp. 5.510% due 08/18/2003 (d) 16,575 16,560 6.396% due 01/20/2004 (d) 3,900 3,900 Golden State Holdings 6.750% due 08/01/2001 (d) 7,000 6,984 Goldman Sachs Group, Inc. 5.971% due 01/17/2003 (d) 5,000 5,009 Heller Financial, Inc. 5.116% due 06/25/2001 (d) 800 800 5.888% due 04/22/2002 (d) 12,900 12,899 6.500% due 07/22/2002 1,000 1,015 Korea Development Bank 7.125% due 09/17/2001 2,604 2,621 7.900% due 02/01/2002 900 913 7.625% due 10/01/2002 2,500 2,564 Lehman Brothers Holdings, Inc. 6.110% due 05/07/2002 (d) 3,000 3,016 6.771% due 04/04/2003 (d) 3,000 3,004 MBNA Corp. 5.360% due 09/13/2001 (d) 5,000 5,005 Merrill Lynch & Co. 5.805% due 08/01/2003 (d) 4,000 4,011 Morgan Stanley, Dean Witter & Co. 5.722% due 01/28/2002 (d) 8,600 8,616 National Consumer Coop Bank 7.151% due 04/02/2001 (d) 16,000 16,000 6.410% due 10/26/2001 (d) 10,000 10,010 Paine Webber Group, Inc. 6.238% due 07/15/2002 (d) 10,000 10,057 Protective Life Funding Trust 6.088% due 01/17/2003 (d) 2,000 2,003 PS Colorado Credit Corp. 5.843% due 05/30/2002 (d) 2,000 1,998 Qwest Capital Funding, Inc. 6.875% due 08/15/2001 15,430 15,522 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 3,312 3,330 6.018% due 07/18/2007 (d) 5,000 5,011 Transamerica Finance Corp. 5.307% due 12/14/2001 (d) 4,000 4,001 U.S. Bancorp 5.755% due 02/03/2003 (d) 3,700 3,714 ------------ 238,361 ------------ Industrials 15.2% Air Canada 6.037% due 07/31/2005 (d) 1,636 1,516 Clear Channel Communications, Inc. 5.583% due 06/15/2002 (d) 900 903 Coastal Corp. 6.125% due 07/21/2003 (d) 5,000 5,014 DaimlerChrysler North America Holding Corp. 6.670% due 09/25/2001 2,000 2,016 6.670% due 02/15/2002 5,900 5,989 5.640% due 08/23/2002 (d) 5,800 5,752 5.153% due 09/16/2002 (d) 7,000 6,921 5.790% due 12/16/2002 (d) 2,100 2,091 Enron Corp. 5.510% due 09/10/2001 (d) 3,000 3,002 HCA - The Healthcare Co. 6.442% due 09/19/2002 (d) 10,000 9,999 Lockheed Martin Corp. 6.850% due 05/15/2001 10,000 10,014 Petroleos Mexicanos 7.768% due 07/15/2005 (d) 2,000 2,005 9.375% due 12/02/2008 1,000 1,043 Racers 5.713% due 03/03/2003 (d) 10,000 10,005 Raytheon Co. 5.738% due 08/10/2001 (d) 10,000 10,012 Safeway, Inc. 7.000% due 09/15/2002 9,300 9,471 Staples, Inc. 6.195% due 11/26/2001 (d) 1,400 1,402 Time Warner, Inc. 6.100% due 12/30/2001 3,000 3,012 Tyco International Group SA 6.125% due 06/15/2001 6,074 6,079 Waste Management, Inc. 7.125% due 06/15/2001 3,000 3,004 ------------ 99,250 ------------ Utilities 11.3% Allete 6.498% due 10/20/2003 (d) 8,800 8,809 Appalachian Power Co. 5.360% due 06/27/2001 (d) 900 900 British Telecommunications PLC 6.078% due 12/15/2003 (d) 5,000 5,002 Central Power & Light Co. 5.830% due 02/22/2002 (d) 2,000 2,002 CenturyTel, Inc. 7.750% due 10/15/2002 2,000 2,037 Commonwealth Edison Co. 5.527% due 09/30/2003 (d) 2,000 2,001 Deutsche Telekom AG 7.750% due 06/15/2005 5,000 5,166 Dominion Resources, Inc. 5.683% due 09/16/2002 (d) 6,500 6,526 Exelon Corp. 5.625% due 11/01/2001 2,000 2,006 Indiana Michigan Power Co. 5.713% due 09/03/2002 (d) 1,000 1,001 Nevada Power Co. 5.990% due 08/20/2001 (d) 5,000 5,005 Oneok, Inc. 6.231% due 04/24/2002 (d) 5,000 5,009 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (c)(d) 1,900 1,568 7.375% due 11/01/2005 (c) 5,000 3,825 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 89 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Short-Term Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Sierra Pacific Resources 6.298% due 04/20/2002 (d) $ 3,000 $ 2,550 6.248% due 04/20/2003 (d) 5,000 4,251 Texas Utilities Electric Co. 5.650% due 12/20/2002 (d) 3,090 3,091 Williams Cos., Inc. 5.888% due 11/15/2001 (d) 7,500 7,511 WorldCom, Inc. 5.575% due 11/26/2001 (d) 3,700 3,690 7.375% due 01/15/2003 1,500 1,518 ------------ 73,468 ------------ Total Corporate Bonds & Notes 411,079 (Cost $412,244) ------------ -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.3% -------------------------------------------------------------------------------- North Carolina 0.3% North Carolina State Education Assistance Authority Revenue Bonds, (GTD Insured), Series 2000 5.263% due 06/01/2009 (d) 2,000 2,000 ------------ Total Municipal Bonds & Notes 2,000 (Cost $2,000) ------------ -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 24.5% -------------------------------------------------------------------------------- Fannie Mae 5.750% due 04/15/2003 850 869 Federal Home Loan Bank 6.750% due 02/01/2002 70,000 70,244 6.375% due 11/15/2002 86,200 88,571 ------------ Total U.S. Government Agencies 159,684 (Cost $156,977) ------------ -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 44.4% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (k) 3.625% due 07/15/2002 149,347 152,287 3.625% due 01/15/2008 (j) 65,247 66,777 U.S. Treasury Notes 6.375% due 01/31/2002 70,000 70,175 ------------ Total U.S. Treasury Obligations 289,239 (Cost $286,251) ------------ -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 28.6% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 15.4% Bayview Financial Revolving Mortgage 6.350% due 08/25/2029 (d) 2,000 2,017 CDC Depositor Trust I 5.642% due 12/14/2001 (d) 361 362 CMC Securities Corp. 7.500% due 02/25/2023 814 812 Dime Savings 7.292% due 11/01/2018 (d) 170 157 DLJ Acceptance Trust 8.290% due 10/17/2020 (d) 433 444 DLJ Mortgage Acceptance Corp. 7.788% due 09/01/2021 (d) 20 20 Donaldson, Lufkin & Jenrette, Inc. 6.227% due 05/01/2026 (d) 78 79 Fannie Mae 7.250% due 04/25/2007 604 604 6.000% due 02/25/2008 862 866 6.264% due 07/25/2008 (d) 1,216 1,218 6.000% due 12/18/2014 2,874 2,875 6.250% due 06/18/2015 867 869 6.000% due 08/18/2016 22,706 22,828 6.150% due 09/25/2016 3,233 3,233 7.000% due 09/18/2017 6,056 6,083 5.650% due 10/25/2017 (d) 4,539 4,573 5.875% due 03/25/2018 15 15 7.000% due 12/25/2019 9,025 9,081 6.000% due 08/25/2020 1,585 1,586 5.000% due 02/25/2022 7 7 6.500% due 09/18/2023 1,520 1,536 8.915% due 06/25/2032 7,877 8,286 First Nationwide Trust 7.357% due 10/25/2018 (d) 3 3 Freddie Mac 7.000% due 08/15/2006 3,680 3,730 6.750% due 03/15/2007 585 589 6.500% due 10/25/2014 3,503 3,538 6.000% due 01/15/2019 786 789 6.000% due 07/15/2019 3,161 3,168 5.437% due 06/15/2023 (d) 362 363 General Electric Capital Mortgage Services, Inc. 6.750% due 12/25/2012 4,395 4,433 Greenwich Capital Acceptance, Inc. 7.709% due 04/25/2022 (d) 48 48 8.056% due 10/25/2022 (d) 19 19 Housing Securities, Inc. 6.000% due 02/25/2008 94 94 Independent National Mortgage Corp. 7.250% due 11/25/2010 3,534 3,570 Prudential Home Mortgage Securities 6.950% due 11/25/2022 233 230 Prudential-Bache Trust 6.764% due 09/01/2018 (d) 20 20 Residential Funding Mortgage Securities, Inc. 7.142% due 12/01/2018 930 949 Resolution Trust Corp. 7.441% due 05/25/2029 (d) 483 494 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 7,767 7,767 Washington Mutual 7.174% due 01/25/2040 2,952 3,044 ------------ 100,399 ------------ Fannie Mae 0.5% 7.000% due 06/01/2003 1,885 1,918 8.500% due 01/01/2026 1,453 1,519 ------------ 3,437 ------------ Freddie Mac 0.1% 7.500% due 11/01/2001 756 760 ------------ Government National Mortgage Association 12.5% 6.000% due 04/20/2030-05/20/2030 (d)(e) 23,076 23,279 6.500% due 03/20/2030 (d) 22,861 23,055 7.375% due 02/20/2024 (d) 9,220 9,353 7.380% due 04/20/2025 (d) 419 426 7.625% due 11/20/2026 (d) 10,231 10,485 7.750% due 09/20/2023-08/20/2027 (d)(e) 6,083 6,229 8.000% due 04/23/2031 3,950 4,077 8.500% due 06/20/2027 4,160 4,307 ------------ 81,211 ------------ Stripped Mortgage-Backed Securities 0.1% ABN AMRO Mortgage Corp. (IO) 6.750% due 08/25/2029 517 42 Fannie Mae (IO) 7.000% due 07/25/2006 776 21 6.500% due 06/25/2017 74 0 6.500% due 10/25/2023 1,074 120 Freddie Mac (IO) 7.000% due 06/15/2019 2,976 140 ------------ 323 ------------ Total Mortgage-Backed Securities 186,130 (Cost $184,862) ------------ -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 9.1% -------------------------------------------------------------------------------- Advanta Revolving Home Equity Loan Trust 5.420% due 01/25/2024 (d) 187 187 American Residential Eagle Trust 5.390% due 07/25/2029 (d) 1,454 1,458 Associates Manufactured Housing 7.000% due 03/15/2027 163 164 Brazos Student Loan Finance Co. 6.475% due 06/01/2023 (d) 20,000 19,955 90 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Capital Asset Research Funding LP 6.400% due 12/15/2004 $ 1,542 $ 1,544 CS First Boston Mortgage Securities Corp. 5.423% due 12/15/2030 (d) 3,842 3,846 Delta Funding Home Equity Loan Trust 5.573% due 09/15/2029 (d) 1,543 1,549 First Security Auto Owner Trust 5.580% due 06/15/2003 3,546 3,554 Ford Credit Auto Owner Trust 5.810% due 03/15/2002 121 122 Green Tree Home Improvement Loan Trust 5.333% due 08/15/2029 (d) 1,497 1,495 Metris Master Trust 5.657% due 04/20/2006 (d) 6,000 6,043 MLCC Mortgage Investors, Inc. 5.543% due 03/15/2025 (d) 2,763 2,774 Onyx Acceptance Auto Trust 6.180% due 04/15/2002 2 2 Salomon Brothers Mortgage Securities VII 5.390% due 12/25/2029 (d) 3,934 3,944 5.400% due 07/25/2029 (d) 2,731 2,736 5.743% due 12/15/2029 (d) 2,000 2,006 7.768% due 11/15/2029 (d) 1,369 1,375 Saxon Asset Securities Trust 7.585% due 12/25/2014 3,100 3,121 The Money Store Home Equity Trust 6.635% due 09/15/2014 2,163 2,167 6.345% due 11/15/2021 60 60 UAF Auto Grantor Trust 6.100% due 06/15/2004 676 681 UniCapital Equipment Contract 6.540% due 07/23/2002 435 435 USAA Auto Loan Grantor Trust 5.800% due 01/15/2005 213 214 ----------- Total Asset-Backed Securities 59,432 (Cost $59,230) ----------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 0.6% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (d) 1,760 1,595 Republic of Croatia 7.000% due 02/27/2002 1,000 1,002 Republic of Panama 7.875% due 02/13/2002 1,000 1,009 ----------- Total Sovereign Issues 3,606 (Cost $3,669) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 7.2% -------------------------------------------------------------------------------- Commercial Paper 7.1% Abbey National North America 5.070% due 05/02/2001 300 299 American Express Credit Corp. 5.150% due 04/04/2001 10,000 9,997 Coca-Cola Co. 4.990% due 04/12/2001 1,700 1,698 Federal Home Loan Bank 4.675% due 09/07/2001 1,900 1,860 General Electric Capital Corp. 5.290% due 06/06/2001 200 198 H.J. Heinz Co. 4.860% due 05/01/2001 3,000 2,988 Morgan Stanley, Dean Witter, Discover & Co. 5.050% due 04/11/2001 10,000 9,987 National Rural Utilities Cooperative Finance Corp. 4.910% due 05/25/2001 10,000 9,928 Reseau Ferre De France 4.620% due 08/16/2001 4,000 3,927 UBS Finance, Inc. 5.830% due 06/06/2001 100 99 Williams Cos., Inc. 7.231% due 04/10/2001 5,600 5,602 ------------ 46,583 ------------ Repurchase Agreement 0.1% State Street Bank 4.600% due 04/02/2001 424 424 (Dated 03/30/2001. Collateralized by Freddie Mac ----------- 7.000% due 03/15/2010 valued at $435. Repurchase proceeds are $424.) U.S. Treasury Bills 0.0% 4.890% due 05/17/2001 (b) 50 50 ----------- Total Short-Term Instruments 47,057 (Cost $47,059) ----------- Total Investments (a) 177.8% $ 1,158,227 (Cost $1,152,292) Other Assets and Liabilities (Net)(77.8%) (507,054) ----------- Net Assets 100.0% $ 651,173 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,152,249 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 9,111 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (3,133) ----------- Unrealized appreciation-net $ 5,978 ----------- (b) Securities with an aggregate market value of $50 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts Appreciation -------------------------------------------------------------------------------- United Kingdom 90 Day LIBOR Futures (03/2002) 30 $ 23 United Kingdom 90 Day LIBOR Futures (06/2002) 30 22 United Kingdom 90 Day LIBOR Futures (09/2002) 30 21 United Kingdom 90 Day LIBOR Futures (12/2002) 30 22 ------------ $ 88 ------------ (c) Security is in default. (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Securities are grouped by coupon or range of coupons and represent a range of maturities. (f) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Covered by Settlement Unrealized Type Currency Contract Month Appreciation -------------------------------------------------------------------------------- Sell BP 525 05/2001 $ 25 Sell N$ 40 04/2001 1 ----------- $ 26 ----------- (g) Principal amount denoted in indicated currency: BP - British Pound N$ - New Zealand Dollar See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 91 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Short-Term Fund March 31, 2001 -------------------------------------------------------------------------------- (h) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 0.470% and pay a fixed rate equal to 7.750%. Broker: Morgan Stanley Exp. 06/15/2005 $ 5,000 $ (367) Receive fixed rate equal to 0.430% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 07/11/2003 5,000 0 Receive fixed rate equal to 0.230% and the Fund will pay to the counterparty at par in the event of default of Associates Corp. 6.000% due 04/15/2003. Broker: Warburg Dillon Read LLC Exp. 01/14/2003 4,000 0 ----------- $ (367) ----------- (i) Reverse repurchase agreements were entered into on various days paying various interest rates. The following securities were segregated with collateral for reverse repurchase agreements: Type Maturity Value -------------------------------------------------------------------------------- Entered into on March 26, 2001 paying interest at 4.880% Government National Mortgage Assn. 7.375% 02/20/2024 $ 9,353 Government National Mortgage Assn. 7.625% 11/20/2026 10,485 Government National Mortgage Assn. 6.000% 05/20/2030 11,116 Government National Mortgage Assn. 6.000% 04/20/2030 12,163 Entered into on March 27, 2001 paying interest at 4.940% Fannie Mae 7.000% 12/25/2019 9,081 Fannie Mae 6.000% 08/18/2016 22,828 ----------- $ 75,026 ----------- (j) Subject to financing transaction. (k) Principal amount of the security is adjusted for inflation. (l) Short sales open at March 31, 2001 was as follows: Coupon Type (%) Maturity Par Value Proceeds -------------------------------------------------------------------------------- U.S. Treasury Notes 5.750 10/31/2002 87,500 $ 89,587 $ 87,412 U.S. Treasury Notes 6.375 01/31/2002 70,000 70,175 70,113 U.S. Treasury Notes 3.625 07/15/2002 64,671 65,944 65,495 Federal Home Loan Bank 6.750 02/01/2002 70,000 70,244 70,094 --------------------------- $ 295,950 $ 293,114 --------------------------- 92 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes PIMCO Schedule of Investments A, B, and C Classes StocksPLUS Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 29.0% -------------------------------------------------------------------------------- Banking & Finance 11.7% Atlas Reinsurance PLC 9.820% due 10/04/2004 (d) $ 7,000 $ 7,000 Bear Stearns Co., Inc. 6.125% due 02/01/2003 1,100 1,109 Beaver Valley Funding Corp. 8.250% due 06/01/2003 1,193 1,226 Capital One Bank 7.610% due 06/23/2003 (d) 5,400 5,282 Chrysler Financial Corp. LLC 5.745% due 02/10/2003 (d) 9,600 9,476 Donaldson, Lufkin & Jenrette, Inc. 6.022% due 04/25/2003 (d) 6,900 6,903 Ford Credit Canada 6.820% due 12/16/2002 (d) 3,800 3,796 Ford Motor Credit Co. 6.699% due 03/19/2002 (d) 590 589 5.938% due 07/16/2002 (d) 6,800 6,798 6.850% due 03/17/2003 (d) 500 496 General Motors Acceptance Corp. 6.190% due 04/15/2001 (d) 1,000 1,001 Gold Eagle Capital Ltd. 11.078% due 04/15/2001 (d) 10,000 10,000 Golden State Holdings 6.525% due 08/01/2003 (d) 6,000 5,815 Lehman Brothers Holdings, Inc. 6.972% due 06/03/2002 (d) 600 601 6.478% due 07/15/2002 (d) 3,005 3,025 MBNA Corp. 6.980% due 09/13/2001 (d) 3,100 3,103 Nacional Financiera 8.575% due 05/08/2003 (d) 6,000 6,134 National Australia Bank Ltd. 7.385% due 05/19/2010 (d) 11,700 11,781 NationsBank Corp. 3.733% due 02/18/2002 (d) 100 100 Old Kent Bank 6.275% due 11/01/2005 (d) 4,500 4,495 Republic New York Corp. 6.652% due 10/28/2002 (d) 100 100 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (g) 3,400 3,419 6.980% due 02/11/2003 (d) 5,000 5,007 6.530% due 03/26/2003 (d) 5,000 5,013 Western Capital 10.665% due 01/07/2003 16,300 16,310 ----------- 118,579 ----------- Industrials 8.5% Air Canada 6.037% due 07/31/2005 (d) 9,818 9,094 Cemex SA de CV 9.250% due 06/17/2002 300 309 Clear Channel Communications, Inc. 7.210% due 06/15/2002 (d) 600 602 CSX Corp. 7.365% due 06/24/2002 (d) 6,900 6,905 Enron Corp. 5.510% due 09/10/2001 (d) 1,000 1,001 8.000% due 08/15/2005 1,100 1,180 Kroger Co. 6.340% due 06/01/2001 2,000 2,002 Petroleos Mexicanos 7.768% due 07/15/2005 (d) 20,000 20,050 Raytheon Co. 5.738% due 08/10/2001 (d) 8,900 8,910 Rollins Truck Leasing Co. 8.250% due 05/01/2002 29,900 30,708 TCI Communications, Inc. 7.236% due 03/11/2003 (d) 4,000 4,024 TRW, Inc. 6.450% due 06/15/2001 400 400 Waste Management, Inc. 6.000% due 05/15/2001 1,500 1,498 ----------- 86,683 ----------- Utilities 8.8% British Telecommunications PLC 7.722% due 12/15/2003 (d) 10,300 10,304 Central Power & Light Co. 7.420% due 11/23/2001 (d) 3,600 3,604 El Paso Energy Corp. 6.328% due 07/15/2001 (d) 4,800 4,803 Entergy Arkansas, Inc. 7.720% due 03/01/2003 3,700 3,829 Marlin Water Trust 7.090% due 12/15/2001 4,049 4,085 Montana Power Co. 7.000% due 04/06/2001 (d) 1,200 1,201 Nevada Power Co. 5.623% due 06/12/2001 (d) 13,000 13,000 Niagara Mohawk Power Co. 7.125% due 07/01/2001 6,805 6,833 Sprint Capital Corp. 6.927% due 06/10/2002 (d) 1,100 1,102 System Energy Resources, Inc. 7.710% due 08/01/2001 250 252 Texas Utilities Corp. 7.210% due 06/25/2001 (d) 1,900 1,900 5.940% due 10/15/2001 28,725 28,860 6.410% due 11/21/2001 1,000 1,009 Western Massachusetts Electric Co. 7.750% due 12/01/2002 1,882 1,884 Williams Cos., Inc. 7.180% due 11/15/2001 (d) 6,900 6,910 ----------- 89,576 ----------- Total Corporate Bonds & Notes 294,838 (Cost $292,845) ----------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 13.3% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (g) 3.625% due 07/15/2002 (b) 114,252 116,500 3.625% due 01/15/2008 17,775 18,192 ----------- Total U.S. Treasury Obligations 134,692 (Cost $131,282) ----------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 75.5% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 14.7% Bank Mart 6.883% due 03/01/2019 (j) 3,908 3,961 California Federal Savings & Loan 7.323% due 07/25/2018 (d) 19 19 Countrywide Home Loans 6.050% due 04/25/2029 4,653 4,678 CS First Boston Mortgage Securities Corp. 6.960% due 01/20/2004 1,710 1,746 DLJ Acceptance Trust 7.910% due 10/17/2020 (d) 123 126 Fannie Mae 5.700% due 06/25/2017 62 62 6.761% due 04/25/2020 (d) 18 18 6.500% due 05/18/2024 2,976 3,011 Freddie Mac 7.000% due 06/15/2023 107 107 6.500% due 08/15/2023 6,446 6,499 Fund America Investors Corp. II 8.079% due 06/25/2023 (d) 97 97 General Electric Capital Mortgage Services, Inc. 6.300% due 09/25/2023 1,616 1,620 6.250% due 10/25/2028 614 617 6.250% due 12/25/2028 1,464 1,406 Government National Mortgage Association 6.220% due 02/16/2030 (d) 13,670 13,704 7.250% due 02/16/2030 (d) 23,419 23,463 6.070% due 02/16/2030 (d) 24,934 25,059 6.236% due 06/20/2030 (d) 18,358 18,387 6.236% due 09/20/2030 (d) 289 290 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 93 PIMCO Schedule of Investments A, B, and C Classes (Cont.) StocksPLUS Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Greenwich Capital Acceptance, Inc. 8.302% due 04/25/2022 (d) $ 166 $ 165 8.230% due 10/25/2022 (d) 5 5 Housing Securities, Inc. 7.320% due 07/25/2032 (d) 400 400 J.P. Morgan & Co., Inc. 6.817% due 01/25/2018 (d) 237 232 Norwest Asset Securities Corp. 6.750% due 08/25/2029 7,443 7,507 PNC Mortgage Securities Corp. 6.625% due 03/25/2028 6,557 6,603 7.500% due 05/25/2040 (d) 5,511 5,589 Resecuritization Mortgage Trust 5.991% due 04/26/2021 (d) 217 215 Residential Funding Mortgage Securities, Inc. 6.798% due 03/25/2018 (d) 1,395 1,387 Resolution Trust Corp. 8.000% due 06/25/2026 562 565 Structured Asset Mortgage Investments, Inc. 9.030% due 06/25/2029 (d) 16,209 17,417 Structured Asset Securities Corp. 7.599% due 09/25/2036 (d) 735 749 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 3,911 3,911 ----------- 149,615 ----------- Fannie Mae 12.4% 6.252% due 12/01/2023 (d) 20 20 6.320% due 05/01/2017 (d) 229 233 6.328% due 02/01/2027-02/01/2031 (d)(i) 686 696 6.446% due 04/01/2018-08/01/2029 (d)(i) 2,677 2,721 6.500% due 09/01/2005 4,723 4,811 7.500% due 04/16/2031 80,000 81,750 7.900% due 05/01/2022 (d) 224 225 8.000% due 04/16/2031 34,000 35,063 ----------- 125,519 ----------- Freddie Mac 0.3% 6.768% due 07/01/2019 (d) 2,373 2,409 7.616% due 12/01/2022 (d) 507 519 8.161% due 06/01/2022 (d) 314 320 8.500% due 04/01/2025-06/01/2025 (i) 181 190 ----------- 3,438 ----------- Government National Mortgage Association 48.0% 6.750% due 07/20/2018-08/20/2026 (d)(i) 14,714 15,064 7.000% due 04/23/2031 101,000 102,579 7.125% due 12/20/2022-12/20/2027 (d)(i) 6,462 6,624 7.375% due 02/20/2026-02/20/2028 (d)(i) 14,566 14,756 7.500% due 08/15/2028-04/23/2031 (i) 198,300 203,306 8.000% due 04/23/2031 141,000 145,347 ----------- 487,676 ----------- Stripped Mortgage-Backed Securities 0.1% Fannie Mae (IO) 7.000% due 07/25/2006 155 4 6.500% due 09/25/2008 161 13 6.500% due 02/25/2021 (d) 1,364 60 7.000% due 07/25/2021 546 61 6.500% due 03/25/2023 2,420 270 Freddie Mac (IO) 6.500% due 08/15/2006 803 23 ----------- 431 ----------- Total Mortgage-Backed Securities 766,679 (Cost $764,294) ----------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 9.6% -------------------------------------------------------------------------------- AFC Home Equity Loan Trust 5.200% due 06/25/2028 (d) 5,893 5,878 Amresco Residential Securities Mortgage Loan Trust 6.810% due 07/25/2027 (d) 15 15 5.868% due 05/25/2028 (d) 154 154 Argentina Funding Corp. 5.840% due 05/20/2003 (d) 16,000 16,037 Bayview Financial Acquisition Trust 6.080% due 02/25/2029 (d) 4,493 4,514 Cross Country Master Credit Card Trust II 5.663% due 06/15/2006 (d) 15,400 15,532 Green Tree Home Improvement Loan Trust 6.742% due 11/15/2029 (d) 6,085 6,087 Green Tree Recreational, Equipment, & Consumables 6.430% due 04/17/2006 1,233 1,245 Novastar Home Equity Loan 5.325% due 04/25/2028 (d) 2,632 2,600 SallieMae 5.841% due 07/25/2004 (d) 187 187 5.901% due 10/25/2005 (d) 5,818 5,818 5.961% due 04/25/2006 (d) 2,407 2,404 Salomon Brothers Mortgage Securities VII 5.390% due 02/25/2030 (d) 18,646 18,694 Starwood Hotel 7.241% due 02/23/2003 8,702 8,653 The Money Store Home Equity Trust 6.550% due 09/15/2021 280 280 6.345% due 11/15/2021 120 120 USAA Auto Loan Grantor Trust 6.100% due 02/15/2006 9,530 9,667 ----------- Total Asset-Backed Securities 97,885 (Cost $97,302) ----------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 11.5% -------------------------------------------------------------------------------- Hydro-Quebec 5.187% due 09/29/2049 (d) 1,200 1,068 Republic of Brazil 7.375% due 04/15/2006 (d) 26,356 23,886 Republic of Croatia 7.000% due 02/27/2002 3,000 3,006 Republic of Germany 3.000% due 06/15/2001 90,000 78,934 Republic of Panama 7.930% due 05/10/2002 824 832 United Mexican States 10.021% due 04/07/2004 (d) 9,000 9,248 ----------- Total Sovereign Issues 116,974 (Cost $119,870) ----------- -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES (e)(f) 2.0% -------------------------------------------------------------------------------- Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 9,750 4,320 Korea Development Bank 2.560% due 06/26/2001 JY 1,000,000 8,000 United Mexican States 8.750% due 05/30/2002 BP 3,000 4,330 7.000% due 06/02/2003 C$ 6,000 3,806 ----------- Total Foreign Currency-Denominated Issues 20,456 (Cost $23,395) ----------- -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 0.0% -------------------------------------------------------------------------------- U.S. Treasury Note (OTC) 5.750% due 11/15/2005 Strike @ 110.875 Exp. 07/02/2001 $ 100,000 16 ----------- Total Purchased Call Options 16 (Cost $16) ----------- 94 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Government National Mortgage Association (OTC) 7.000% due 05/21/2031 Strike @ 94.641 Exp. 05/04/2001 $ 100,000 $ 0 Government National Mortgage Association (OTC) 7.500% due 06/20/2031 Strike @ 95.625 Exp. 06/13/2001 369,000 15 PNC Mortgage Securities (OTC) 7.500% due 05/25/2040 Strike @ 100.000 Exp. 04/01/2005 6,200 0 ----------- Total Purchased Put Options 15 (Cost $37) ----------- -------------------------------------------------------------------------------- PREFERRED SECURITY 0.1% -------------------------------------------------------------------------------- Shares DG Funding Trust 7.153% due 12/29/2049(d) 110 1,122 ----------- Total Preferred Security 1,122 (Cost $1,103) ----------- -------------------------------------------------------------------------------- PREFERRED STOCK 0.8% -------------------------------------------------------------------------------- TCI Communications, Inc. 9.720% due 12/31/2036 303,565 7,726 ----------- Total Preferred Stock 7,726 (Cost $7,996) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 10.2% -------------------------------------------------------------------------------- Principal Amount (000s) Commercial Paper 8.6% American Express Credit Corp. 4.940% due 05/15/2001 $ 6,600 6,561 Gannett Co., Inc. 5.000% due 04/20/2001 24,700 24,637 KFW International Finance, Inc. 4.820% due 05/30/2001 9,900 9,823 Monsanto Co. 4.650% due 08/16/2001 3,600 3,535 Swedbank, Inc. 4.930% due 04/25/2001 9,900 9,869 4.700% due 09/05/2001 14,900 14,592 UBS Finance, Inc. 5.400% due 04/02/2001 15,900 15,900 4.820% due 08/15/2001 2,000 1,964 ----------- 86,881 ----------- Repurchase Agreement 1.6% State Street Bank 4.600% due 03/30/2001 5,844 5,844 (Dated 03/30/2001. Collateralized by Fannie Mae 5.600% due 07/25/2003 valued at $5,965. Repurchase proceeds are $5,846.) Daiwa Securities 5.150% due 04/02/2001 10,000 10,000 (Dated 03/30/2001. Collateralized by U.S. Treasury Bill due 06/28/2001 valued at $10,316. Repurchase proceeds are $10,004.) ----------- 15,844 ----------- U.S. Treasury Bills (b)(i) 0.0% 4.915% due 05/17/2001 510 507 ----------- Total Short-Term Instruments 103,232 (Cost $103,239) ----------- Total Investments (a) 152.0% $ 1,543,635 (Cost $1,541,379) Written Options (c) (0.1%) (815) (Premiums $756) Other Assets and Liabilities (Net)(51.9%) (527,337) ----------- Net Assets 100.0% $ 1,015,483 ----------- Notes to Schedule of Investments (amounts in thousands): (a)At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,541,331 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 9,728 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (7,424) ----------- Unrealized appreciation-net $ 2,304 ----------- (b) Securities with an aggregate market value of $86,796 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- S&P 500 Index (06/2001) 1,054 $ (27,301) S&P 500 Index (09/2001) 1,573 396 U.S. Treasury 5 Year Note (06/2001) 977 (599) ----------- $ (27,504) ----------- (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Call - CME S&P June Futures Strike @ 1,380.00 Exp. 06/15/2001 56 $ 203 $ 25 Put - CME S&P June Futures Strike @ 1,160.00 Exp. 06/15/2001 56 302 665 Put - CME S&P June Futures Strike @ 1,050.00 Exp. 06/15/2001 28 251 125 --------------------------- $ 756 $ 815 --------------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Sell BP 3,902 05/2001 192 Sell C$ 5,773 04/2001 72 Buy EC 73,359 04/2001 (235) Sell 74,823 04/2001 3,715 Sell 73,359 06/2001 275 Buy HF 2,300,000 09/2001 (171) Buy JY 1,436,697 04/2001 (285) Sell 1,436,697 04/2001 634 Sell 1,436,697 06/2001 282 Sell N$ 10,942 04/2001 187 ----------- $ 4,666 ----------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 95 PIMCO Schedule of Investments A, B, and C Classes (Cont.) StocksPLUS Fund March 31, 2001 -------------------------------------------------------------------------------- (f) Principal amount denoted in indicated currency: BP - British Pound C$ - Canadian Dollar EC - Euro HF - Hungarian Forint JY - Japanese Yen N$ - New Zealand Dollar (g) Principal amount of the security is adjusted for inflation. (h) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount/Units Appreciation -------------------------------------------------------------------------------- Receive total return on S&P 500 Index and pay floating rate based on 1-month LIBOR plus 0.200%. Broker: Morgan Stanley Exp. 07/06/2001 $ 32,704 $ 0 Receive total return on S&P 500 Index and pay floating rate based on 1-month LIBOR plus 0.300%. Broker: Lehman Brothers Exp. 07/31/2001 4,188 0 Receive total return on S&P 500 Index and pay floating rate based on 1-month LIBOR plus 0.250%. Broker: Morgan Stanley Exp. 10/03/2001 38,761 0 Receive total return on S&P 500 Index and pay floating rate based on 1-month LIBOR plus 0.320%. Broker: J.P. Morgan Exp. 03/20/2002 54,693 0 Receive total return on S&P 500 Index and pay floating rate based on 1 month LIBOR plus 0.180%. Broker: J.P. Morgan Exp. 04/30/2001 11,569 0 Receive a fixed rate equal to 1.290% and the Fund will pay to the counterparty at par in the event of default in of the United Mexican States at 9.750% due 04/06/2005. Broker: J.P. Morgan Exp. 06/19/2002 15,500 2 Receive a fixed rate equal to 0.400% and the Fund will pay to the counterparty at par in the event of default of Enron Corp. Bond. Broker: Morgan Stanley Exp. 06/16/2001 50,000 2 ----------- $ 4 ----------- (i) Securities are grouped by coupon or range of coupons and represent a range of maturities. (j) Restricted security. 96 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes PIMCO Schedule of Investments A, B, and C Classes Strategic Balanced Fund March 31, 2001 Value Shares (000s) -------------------------------------------------------------------------------- PIMCO FUNDS (b) 93.5% -------------------------------------------------------------------------------- StocksPLUS 3,982,096 $ 40,618 Total Return 2,761,234 29,048 ----------- Total PIMCO Funds 69,666 (Cost $80,568) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 5.7% -------------------------------------------------------------------------------- Principal Amount (000s) Repurchase Agreement 5.7% State Street Bank 4.600% due 04/02/2001 $ 4,279 4,279 (Dated 03/30/2001. Collateralized by Freddie Mac 6.680% due 12/28/2001 valued at $4,369. Repurchase proceeds are $4,281.) ----------- Total Short-Term Instruments 4,279 (Cost $4,279) ----------- Total Investments (a) 99.2% $ 73,945 (Cost $84,847) Other Assets and Liabilities (Net) 0.8% 559 ----------- Net Assets 100.0% $ 74,504 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $85,450 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 1,059 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (12,564) ----------- Unrealized depreciation-net $ (11,505) ----------- (b) Institutional Class shares of each PIMCO Fund. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 97 PIMCO Schedule of Investments A, B, and C Classes Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 35.0% -------------------------------------------------------------------------------- Banking & Finance 22.1% AB Spintab 6.800% due 12/29/2049 $ 250 $ 253 Abbey National Capital Trust I 8.963% due 12/29/2049 31,600 35,041 Abbey National PLC 6.700% due 06/29/2049 5,000 4,839 Abbey National Treasury Service PLC 6.625% due 05/23/2001 240 241 ABN AMRO Mortgage Corp. 7.250% due 05/31/2005 150 158 Aetna, Inc. 6.750% due 08/15/2001 250 251 Air 2 US 8.027% due 10/01/2020 294 313 Allstate Corp. 7.875% due 05/01/2005 100 108 6.750% due 05/15/2018 280 271 6.900% due 05/15/2038 87,200 81,841 AMERCO 7.135% due 10/15/2002 15,000 14,746 7.230% due 01/21/2027 1,250 1,207 American Express Co. 8.500% due 08/15/2001 350 355 5.625% due 01/22/2004 14,700 14,848 7.450% due 08/10/2005 1,000 1,070 American General Finance 6.050% due 07/02/2001 3,000 3,010 6.875% due 12/14/2001 1,600 1,624 7.450% due 07/01/2002 200 206 6.250% due 12/18/2002 1,165 1,191 6.375% due 03/01/2003 350 358 6.170% due 05/06/2003 3,200 3,275 8.125% due 03/15/2046 270 276 American Health Properties, Inc. 7.050% due 01/15/2002 700 700 Aon Capital Trust A 8.205% due 01/01/2027 725 700 Aristar, Inc. 7.375% due 09/01/2004 20,000 20,825 Associates Corp. of North America 6.625% due 05/15/2001 1,300 1,302 6.700% due 05/29/2001 100 100 7.000% due 07/23/2001 500 504 5.400% due 08/27/2001 (d) 13,500 13,539 6.450% due 10/15/2001 23,600 23,801 7.500% due 04/15/2002 185 190 5.446% due 05/21/2002 (d) 6,850 6,857 6.375% due 07/15/2002 175 178 6.500% due 07/15/2002 750 766 6.000% due 12/01/2002 500 508 5.750% due 11/01/2003 5,425 5,477 5.800% due 04/20/2004 450 455 6.625% due 06/15/2005 100 103 AT&T Capital Corp. 6.250% due 05/15/2001 19,443 19,459 7.000% due 08/15/2001 11,100 11,163 7.110% due 09/13/2001 1,030 1,038 6.900% due 01/30/2002 1,000 1,010 6.750% due 02/04/2002 1,925 1,944 5.881% due 04/23/2002 (d) 74,000 74,177 Avalonbay Communities 7.375% due 09/15/2002 2,565 2,629 AVCO Financial Services, Inc. 7.375% due 08/15/2001 300 303 Banco Latinoamericano SA 6.500% due 04/02/2001 950 950 7.173% due 06/04/2001 5,000 5,000 7.878% due 11/30/2001 9,500 9,500 Banco Nacional de Comercio Exterior 7.250% due 02/02/2004 25,050 25,238 Banesto Delaware, Inc. 8.250% due 07/28/2002 43,900 45,508 Bank of America Corp. 9.500% due 04/01/2001 235 235 7.000% due 09/15/2001 1,500 1,513 6.538% due 09/26/2001 (d) 33,000 33,000 6.752% due 02/20/2002 (d) 35,180 35,205 8.125% due 06/15/2002 350 363 6.810% due 06/17/2002 (d) 10,000 10,005 7.750% due 07/15/2002 510 527 7.750% due 08/01/2002 896 898 7.200% due 09/15/2002 1,000 1,030 7.500% due 10/15/2002 1,200 1,244 6.850% due 03/01/2003 65 67 6.875% due 06/01/2003 100 103 6.500% due 08/15/2003 150 154 6.125% due 07/15/2004 600 608 6.750% due 09/15/2005 200 206 8.570% due 11/15/2024 125 141 Bank One Corp. 6.820% due 04/19/2001 (d) 2,000 2,001 6.733% due 09/04/2001 (d) 14,000 14,006 6.348% due 06/26/2002 (d) 5,000 5,002 6.895% due 09/26/2003 (d) 18,400 18,411 BankBoston Corp. 6.125% due 03/15/2002 12,500 12,626 Banponce Financial Corp. 6.463% due 11/13/2001 13,000 13,117 Barclays Bank PLC 8.550% due 09/29/2049 25,000 27,678 Bayerische Landesbank NY 6.200% due 02/09/2006 250 252 Bear Stearns Co., Inc. 9.375% due 06/01/2001 125 126 7.083% due 04/05/2002 (d) 25,000 24,879 5.640% due 05/07/2002 (d) 4,300 4,303 7.134% due 08/01/2002 (d) 71,500 71,556 5.370% due 12/16/2002 (d) 48,900 48,984 6.125% due 02/01/2003 25 25 5.210% due 03/28/2003 (d) 81,500 81,476 6.750% due 04/15/2003 105 107 5.718% due 05/06/2003 (d) 25,000 24,796 7.013% due 05/16/2003 (d) 40,700 40,372 5.820% due 07/22/2003 (d) 19,000 18,795 6.700% due 08/01/2003 100 102 6.625% due 01/15/2004 200 204 6.150% due 03/02/2004 200 201 8.750% due 03/15/2004 75 81 7.156% due 06/01/2004 (d) 12,665 12,518 5.270% due 09/21/2004 (d) 5,200 5,202 7.036% due 03/18/2005 (d) 37,000 37,134 6.848% due 09/16/2005 (d) 16,000 15,763 Beaver Valley Funding Corp. 8.250% due 06/01/2003 405 416 Beneficial Corp. 6.610% due 09/13/2001 140 141 5.409% due 01/09/2002 (d) 500 501 6.870% due 03/01/2002 (d) 50,000 50,109 8.000% due 06/18/2002 400 412 6.030% due 01/14/2003 320 323 Bombardier Capital Trust I 7.210% due 06/09/2032 (d) 16,150 15,914 Bombardier Capital Trust II 7.210% due 06/09/2032 (d) 3,600 3,547 Bombardier Capital, Inc. 7.300% due 12/15/2002 9,000 9,194 Caithness Coso Fund Corp. 6.800% due 12/15/2001 5,659 5,644 Chase Manhattan Bank 6.125% due 11/01/2008 400 391 98 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Chase Manhattan Corp. 8.500% due 02/15/2002 $ 200 $ 206 5.750% due 04/15/2004 150 152 6.000% due 11/01/2005 50 50 Chrysler Financial Corp. LLC 5.606% due 06/11/2001 (d) 46,700 46,686 5.690% due 11/15/2001 650 652 5.400% due 01/15/2002 15,750 15,671 6.950% due 03/25/2002 50 51 5.701% due 07/17/2002 (d) 20,000 19,823 5.120% due 08/08/2002 (d) 66,100 65,524 5.756% due 02/03/2003 (d) 50,000 49,367 5.150% due 02/10/2003 (d) 7,100 7,008 6.789% due 03/06/2003 (d) 25,000 24,512 5.736% due 03/10/2003 (d) 65,000 63,688 6.739% due 06/18/2003 35,000 34,424 Chubb Capital Corp. 6.875% due 02/01/2003 100 103 Cincinnati Financial Corp. 6.900% due 05/15/2028 111,870 100,124 CIT Group, Inc. 5.800% due 03/26/2002 1,000 1,007 5.190% due 09/13/2002 (d) 30,900 30,810 7.375% due 03/15/2003 500 517 5.625% due 10/15/2003 250 250 Citicorp 8.000% due 02/01/2003 250 262 CitiFinancial Credit Co. 8.250% due 11/01/2001 2,500 2,548 6.875% due 05/01/2002 335 342 6.375% due 09/15/2002 115 117 7.750% due 03/01/2005 550 588 Citigroup, Inc. 5.800% due 03/15/2004 200 203 CNA Financial Corp. 6.250% due 11/15/2003 65 64 Comerica Bank 7.250% due 06/15/2007 200 211 Countrywide Home Loans 6.250% due 04/15/2009 600 585 Credit Asset Receivable 6.274% due 10/31/2003 34,030 34,156 DBS Group Holdings Ltd. 7.875% due 08/10/2009 6,000 6,445 Deutsche Telekom International Finance 7.750% due 06/15/2005 97,100 100,329 Donaldson, Lufkin & Jenrette, Inc. 6.910% due 09/18/2002 (d) 13,600 13,609 6.023% due 04/25/2003 (d) 400 400 6.170% due 07/15/2003 20,000 20,423 Dow Capital BV 7.125% due 01/15/2003 100 103 Duke Capital Corp. 7.250% due 10/01/2004 19,000 19,921 Export-Import Bank Korea 7.250% due 06/25/2001 2,600 2,606 7.125% due 09/20/2001 12,370 12,404 6.500% due 02/10/2002 26,141 26,159 6.500% due 11/15/2006 6,445 6,567 7.100% due 03/15/2007 17,600 18,297 Exxon Capital Corp. 6.125% due 09/08/2008 2,000 2,029 Farmers Insurance 8.625% due 05/01/2024 275 280 Finova Capital Corp. 5.875% due 10/15/2001 (e) 1,000 831 6.040% due 11/08/2002 (d)(e) 51,350 42,159 6.316% due 04/08/2003 (d)(e) 300 246 5.193% due 06/18/2003 (d)(e) 32,300 26,486 6.330% due 11/24/2003 1,300 1,083 First Chicago Corp. 9.250% due 11/15/2001 250 256 6.740% due 03/11/2002 (d) 20,000 20,039 6.884% due 07/28/2003 (d) 50 50 First National Bank Chicago 8.080% due 01/05/2018 250 270 First Security Corp. 5.875% due 11/01/2003 9,325 9,421 First Union Corp. 8.125% due 06/24/2002 150 155 FleetBoston Financial Corp. 9.900% due 06/15/2001 200 202 Ford Credit Canada 6.820% due 12/16/2002 (d) 56,000 55,943 Ford Motor Credit Co. 7.020% due 06/07/2001 1,000 1,003 5.030% due 07/13/2001 (d) 47,700 47,690 6.813% due 09/03/2001 (d) 27,000 27,024 7.000% due 09/25/2001 1,125 1,136 6.918% due 10/15/2001 (d) 13,000 13,005 6.838% due 11/16/2001 (d) 82,800 82,869 8.240% due 01/15/2002 85 87 5.804% due 01/17/2002 (d) 53,945 53,901 8.200% due 02/15/2002 500 513 6.500% due 02/28/2002 1,710 1,732 6.093% due 03/19/2002 (d) 28,458 28,399 6.873% due 04/29/2002 (d) 33,000 33,007 6.961% due 05/21/2002 (d) 7,000 7,005 6.878% due 05/23/2002 (d) 14,000 14,018 6.823% due 06/04/2002 (d) 12,000 12,000 8.000% due 06/15/2002 150 155 5.939% due 07/16/2002 (d) 172,555 172,496 6.911% due 08/01/2002 (d) 36,000 35,989 6.550% due 09/10/2002 4,000 4,064 5.829% due 10/15/2002 (d) 35,050 35,012 7.750% due 11/15/2002 5,730 5,931 6.000% due 01/14/2003 1,100 1,109 7.500% due 01/15/2003 250 258 6.900% due 02/03/2003 (d) 40,000 39,883 5.535% due 02/13/2003 (d) 284,185 282,374 5.133% due 03/17/2003 (d) 37,000 36,723 6.125% due 04/28/2003 26,130 26,409 5.323% due 06/02/2003 (d) 38,100 38,050 6.826% due 06/20/2003 (d) 16,900 16,885 6.625% due 06/30/2003 775 791 5.605% due 11/24/2003 (d) 47,000 46,916 5.750% due 02/23/2004 1,216 1,215 6.125% due 03/20/2004 400 404 5.860% due 04/26/2004 (d) 63,000 62,473 6.951% due 05/21/2004 (d) 32,200 31,883 6.873% due 06/02/2004 (d) 1,500 1,485 7.500% due 06/15/2004 100 105 6.700% due 07/16/2004 92,905 95,111 6.089% due 07/19/2004 (d) 174,500 173,338 8.250% due 02/23/2005 2,500 2,681 7.500% due 03/15/2005 17,000 17,801 6.946% due 04/28/2005 (d) 58,000 56,929 5.353% due 06/30/2005 (d) 65,000 64,244 6.179% due 07/18/2005 (d) 214,000 210,617 7.600% due 08/01/2005 5,000 5,268 6.375% due 12/15/2005 100 101 5.400% due 08/27/2006 (d) 27,500 27,500 7.200% due 06/15/2007 25 26 5.800% due 01/12/2009 155 146 Fuji Bank Ltd. 9.870% due 12/31/2049 (d) 25,475 21,123 General Electric Capital Corp. 6.020% due 05/04/2001 1,000 1,001 5.500% due 11/01/2001 50 50 5.650% due 03/31/2003 125 127 6.210% due 12/09/2005 400 413 7.875% due 12/01/2006 30 33 General Motors Acceptance Corp. 7.125% due 05/01/2001 44,395 44,464 6.750% due 06/05/2001 880 883 6.875% due 07/15/2001 1,000 1,006 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 99 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 6.375% due 12/01/2001 $ 765 $ 772 5.500% due 12/15/2001 100 100 9.625% due 12/15/2001 5,650 5,826 6.625% due 01/10/2002 500 506 6.750% due 02/07/2002 1,590 1,612 7.750% due 03/25/2002 125 129 6.250% due 08/15/2002 100 101 7.000% due 09/15/2002 250 255 6.625% due 10/01/2002 5,000 5,089 7.103% due 10/07/2002 (d) 18,100 18,124 5.509% due 11/12/2002 (d) 10,200 10,210 5.609% due 11/12/2002 (d) 28,995 28,917 6.860% due 12/09/2002 (d) 64,050 64,157 6.750% due 12/10/2002 500 511 6.200% due 12/15/2002 500 506 5.480% due 12/16/2002 150 150 6.000% due 01/15/2003 990 1,002 5.875% due 01/22/2003 100,500 101,153 5.548% due 02/14/2003 (d) 10,000 9,962 5.210% due 03/10/2003 (d) 7,000 6,970 6.750% due 03/15/2003 49,725 50,906 7.125% due 05/01/2003 36,000 37,054 6.394% due 07/20/2003 (d) 13,042 13,030 5.924% due 07/21/2003 (d) 13,700 13,720 5.510% due 08/18/2003 (d) 128,090 127,973 5.550% due 09/15/2003 32,000 31,954 6.625% due 10/20/2003 2,000 2,046 5.750% due 11/10/2003 1,100 1,102 6.396% due 01/20/2004 (d) 273,857 273,826 5.750% due 03/22/2004 (d) 123,300 123,300 6.536% due 04/05/2004 (d) 43,500 42,879 6.930% due 05/28/2004 (d) 73,000 71,588 6.850% due 06/17/2004 1,200 1,234 5.999% due 07/21/2004 (d) 62,800 62,233 7.291% due 09/20/2004 (d) 19,951 19,933 6.650% due 11/17/2005 500 509 6.150% due 04/05/2007 150 146 8.950% due 07/02/2009 17,333 18,580 Gold Eagle Capital Ltd. 11.079% due 04/15/2001 (d) 46,300 46,300 Golden State Holdings 6.750% due 08/01/2001 (d) 1,950 1,946 7.759% due 08/01/2003 (d) 500 485 Goldman Sachs Group, Inc. 5.971% due 01/17/2003 (d) 72,000 72,124 6.625% due 12/01/2004 275 281 7.625% due 08/17/2005 23,000 24,515 7.458% due 02/09/2009 (d) 10,000 10,084 6.500% due 02/25/2009 140 139 Great Western Finance Trust II 8.206% due 02/01/2027 150 145 Halyard RE 10.555% due 04/05/2002 (d) 1,800 1,800 Hansol Paper Co. Ltd. 8.943% due 05/24/2001 (d) 20,000 20,200 Hartford Life, Inc. 6.900% due 06/15/2004 600 622 Heller Financial, Inc. 6.803% due 06/07/2001 (d) 4,000 4,002 5.116% due 06/25/2001 (d) 101,250 101,288 5.750% due 09/25/2001 1,400 1,405 5.979% due 10/22/2001 (d) 19,200 19,215 6.500% due 11/01/2001 250 252 7.658% due 11/09/2001 (d) 4,400 4,421 5.889% due 04/22/2002 (d) 2,100 2,100 6.940% due 04/26/2002 (d) 12,000 11,992 6.850% due 05/07/2002 (d) 25,400 25,386 6.930% due 05/13/2002 (d) 10,000 9,992 7.000% due 05/15/2002 900 915 6.500% due 07/22/2002 140 142 5.979% due 07/24/2002 (d) 16,200 16,233 5.858% due 04/28/2003 (d) 53,500 53,350 6.989% due 04/28/2003 (d) 26,000 25,960 Hertz Corp. 7.000% due 07/15/2003 13,300 13,684 Hitachi Credit America 5.939% due 10/15/2003 (d) 11,500 11,501 Household Bank 6.961% due 04/03/2001 (d) 16,000 16,000 6.820% due 09/26/2001 (d) 9,000 9,007 6.949% due 10/22/2003 (d) 15,000 14,956 Household Capital Trust III 7.010% due 06/26/2004 (d) 23,925 22,133 Household Finance Corp. 6.490% due 04/09/2001 9,920 9,922 6.780% due 06/22/2001 (d) 3,000 3,000 6.909% due 08/01/2001 (d) 1,500 1,501 6.909% due 11/01/2001 (d) 4,500 4,504 6.876% due 05/07/2002 (d) 43,450 43,252 6.951% due 05/24/2002 (d) 113,800 113,938 7.080% due 06/03/2002 15,000 15,345 5.875% due 11/01/2002 200 202 6.125% due 02/27/2003 500 504 5.116% due 06/24/2003 (d) 31,000 30,897 Household Netherlands BV 6.125% due 03/01/2003 18,100 18,275 HSBC Capital Funding LP 10.176% due 12/29/2049 20,000 20,735 9.547% due 12/31/2049 76,400 88,226 10.176% due 12/31/2049 26,160 32,221 Industrial Bank of Korea 7.100% due 10/15/2001 3,290 3,313 Inter-American Development Bank 5.375% due 01/18/2006 181,000 181,970 8.875% due 06/01/2009 200 242 7.375% due 01/15/2010 4,200 4,678 International Bank for Reconstruction & Development 7.000% due 01/27/2005 1,000 1,065 International Lease Finance Corp. 5.930% due 07/15/2003 14,000 14,172 J.P. Morgan & Co., Inc. 6.700% due 11/01/2007 30 31 6.655% due 02/15/2012 (d) 600 548 JET Equipment Trust 10.000% due 06/15/2012 80 92 10.690% due 05/01/2015 100 122 John Hancock 7.375% due 02/15/2024 360 351 KBC Bank Fund Trust III 9.860% due 11/29/2049 (d) 5,700 6,394 Key Bank USA NA 7.550% due 09/15/2006 350 370 Kimco Realty Corp. 6.500% due 10/01/2003 200 203 Korea Development Bank 7.125% due 09/17/2001 13,055 13,141 7.900% due 02/01/2002 300 304 8.600% due 03/25/2002 6,600 6,786 6.500% due 11/15/2002 440 444 6.750% due 12/01/2005 55 55 7.250% due 05/15/2006 50 51 LB Rheinland - PFALZ 5.000% due 02/23/2028 3,400 3,383 Lehman Brothers Holdings, Inc. 7.019% due 03/18/2002 (d) 10,000 10,000 6.375% due 05/07/2002 61,290 62,098 8.750% due 05/15/2002 219 227 6.186% due 07/08/2002 (d) 60,100 60,139 6.479% due 07/15/2002 (d) 43,651 43,945 7.125% due 07/15/2002 100 102 7.080% due 08/12/2002 (d) 6,500 6,489 7.450% due 08/28/2002 (d) 6,500 6,509 5.389% due 09/03/2002 (d) 14,000 14,003 100 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 5.610% due 12/12/2002 (d) $ 60,100 $ 60,344 5.240% due 04/04/2003 (d) 132,550 132,747 7.625% due 06/01/2006 350 370 LG&E Capital Corp. 7.360% due 06/18/2001 (d) 400 400 6.205% due 05/01/2004 1,000 966 6.460% due 01/15/2008 3,000 2,714 Liberty Mutual Insurance 8.200% due 05/04/2007 17,510 18,272 Limestone Electron Trust 8.625% due 03/15/2003 71,350 74,521 Lion Connecticut Holdings 6.375% due 08/15/2003 200 204 7.250% due 08/15/2023 50 48 Lloyds TSB Bank 5.745% due 08/26/2010 (d) 3,000 2,999 MBNA America Bank NA 7.010% due 04/25/2002 (d) 1,000 999 MBNA Corp. 5.610% due 08/07/2001 (d) 100 100 6.980% due 09/13/2001 (d) 10,300 10,310 MCN Investment Corp. 7.120% due 01/16/2004 7,500 7,614 6.300% due 04/02/2011 7,500 7,500 Merrill Lynch & Co. 6.500% due 04/01/2001 400 400 6.750% due 04/30/2001 2,775 2,778 8.000% due 02/01/2002 400 410 7.375% due 08/17/2002 300 310 8.300% due 11/01/2002 700 734 6.000% due 02/12/2003 500 509 6.875% due 03/01/2003 140 145 5.006% due 06/24/2003 (d) 27,000 26,992 6.550% due 08/01/2004 400 414 7.000% due 04/27/2008 100 104 Metropolitan Life Insurance Co. 6.300% due 11/01/2003 6,800 6,910 MIC Financing Trust I 8.375% due 02/01/2027 36,000 32,484 Monumental Global Funding II 6.910% due 09/26/2003 (d) 58,500 58,519 Morgan Stanley Group, Inc. 6.700% due 05/01/2001 600 601 9.375% due 06/15/2001 300 303 5.228% due 03/11/2003 (d) 11,500 11,500 6.375% due 12/15/2003 150 154 5.625% due 01/20/2004 1,200 1,206 Morgan Stanley, Dean Witter & Co. 6.948% due 04/15/2002 (d) 550 551 5.590% due 05/05/2003 (d) 43,000 43,088 6.964% due 08/07/2003 (d) 140,800 140,974 5.899% due 04/22/2004 (d) 108,500 108,622 Nacional Financiera 9.750% due 03/12/2002 10,000 10,365 7.284% due 05/08/2003 (d) 7,750 8,021 National Rural Utilities Cooperative Finance Corp. 6.880% due 05/31/2002 (d) 10,000 10,010 5.721% due 08/13/2002 (d) 12,000 12,003 6.250% due 04/15/2003 50,000 50,728 National Westminster Bank PLC 5.520% due 09/16/2002 (d) 12,275 12,317 9.375% due 11/15/2003 200 220 Newcourt Credit Group, Inc. 6.875% due 02/16/2005 7,500 7,712 Noble Affiliates, Inc. 8.950% due 12/15/2004 11,500 11,990 Nordbanken AB 7.250% due 11/12/2009 25,250 26,224 8.950% due 11/19/2049 4,000 4,389 Nordstrom Credit, Inc. 7.250% due 04/30/2002 1,000 1,026 Northern Rock PLC 2.000% due 01/01/2000 660 14,685 Okobank 7.040% due 05/23/2006 (d) 10,000 10,081 Old Kent Bank 6.275% due 11/01/2005 (d) 1,300 1,299 7.750% due 08/15/2010 19,500 20,517 Orix Credit Alliance, Inc. 6.785% due 04/16/2001 15,000 15,007 7.640% due 09/17/2001 13,000 13,163 Osprey Trust 8.310% due 01/15/2003 75,475 77,834 Pacific Life Insurance Co. 7.900% due 12/30/2023 8,000 8,097 Paine Webber Group, Inc. 7.030% due 05/20/2002 (d) 1,000 1,000 7.290% due 07/15/2002 (d) 200 201 Parker Retirement Savings Plan 6.340% due 07/15/2008 791 791 PDVSA Finance Ltd. 7.400% due 08/15/2016 1,200 966 Pemex Finance Ltd. 6.125% due 11/15/2003 17,111 17,007 PNC Bank NA 5.150% due 01/24/2002 (d) 49,000 49,030 PNC Funding Corp. 6.875% due 03/01/2003 100 103 7.000% due 09/01/2004 20,000 20,771 PNC Institutional Capital Trust A 7.950% due 12/15/2026 150 146 Popular North American, Inc. 6.875% due 06/15/2001 16,500 16,559 7.375% due 09/15/2001 25,000 25,263 Popular, Inc. 6.200% due 04/30/2001 3,336 3,338 6.540% due 11/06/2001 18,705 18,877 6.625% due 01/15/2004 19,500 19,804 Premium Asset Trust 7.076% due 11/27/2004 (d) 48,900 49,009 Prime Property Funding II 7.000% due 08/15/2004 110 112 Protective Life Funding Trust 6.089% due 01/17/2003 (d) 2,000 2,003 Prudential Funding Corp. 6.375% due 07/23/2006 100 101 6.625% due 04/01/2009 17,000 16,110 PSEG Capital Corp. 6.740% due 10/23/2001 1,400 1,414 Qwest Capital Funding, Inc. 6.875% due 08/15/2001 73,750 74,190 7.253% due 07/08/2002 (d) 18,000 18,024 Reliance Group Holdings, Inc. 9.000% due 11/15/2000 (e) 19,000 1,663 9.750% due 11/15/2003 (e) 10,000 288 Reliant Energy Financial Co. 7.660% due 12/10/2001 (d) 53,100 53,120 Rothmans Holdings 6.500% due 05/06/2003 16,390 16,561 Royal Bank of Scotland Group PLC 6.770% due 03/31/2049 126,500 115,896 8.817% due 03/31/2049 41,600 45,064 9.118% due 03/31/2049 66,400 75,622 Salomon, Inc. 6.650% due 07/15/2001 600 603 7.000% due 03/04/2002 18,850 19,236 6.750% due 02/15/2003 450 462 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (i) 30,140 30,306 6.625% due 07/01/2002 55 56 6.125% due 01/15/2003 290 294 5.629% due 02/11/2003 (d) 44,200 44,264 5.848% due 04/28/2003 (d) 28,000 28,027 7.000% due 03/15/2004 100 104 Sears Roebuck Acceptance Corp. 6.800% due 05/07/2001 500 501 6.790% due 05/21/2001 500 501 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 101 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 7.190% due 06/18/2001 $ 5,880 $ 5,908 7.110% due 06/19/2001 1,000 1,005 6.860% due 07/03/2001 3,409 3,426 9.400% due 08/02/2001 250 253 6.860% due 08/06/2001 400 403 6.710% due 08/13/2001 80 80 6.600% due 10/09/2001 17,000 17,162 6.360% due 12/04/2001 290 293 6.120% due 12/13/2001 260 262 6.950% due 05/15/2002 300 305 6.000% due 03/20/2003 149,750 150,403 7.260% due 04/21/2003 3,000 3,104 7.140% due 05/02/2003 5,000 5,164 6.560% due 11/20/2003 1,178 1,204 Seismic Ltd. 10.901% due 01/01/2002 (d) 32,500 32,305 Simon Property Group, Inc. 9.000% due 03/15/2002 2,000 2,054 Socgen Real Estate LLC 7.640% due 12/29/2049 20,000 20,120 Spieker Properties, Inc. 6.800% due 12/15/2001 5,500 5,552 6.950% due 12/15/2002 1,600 1,632 6.800% due 05/01/2004 1,000 1,020 Steers 10.501% due 08/07/2002 (d) 20,000 20,388 Sumitomo Bank Treasury Co. 9.400% due 12/29/2049 (d) 6,750 6,510 Sun Life of Canada (U.S.) 8.526% due 05/29/2049 250 235 Telewest Credit Links 8.500% due 04/16/2004 25,000 21,459 Textron Financial Corp. 5.860% due 10/26/2001 (d) 11,200 11,219 7.099% due 05/28/2002 (d) 51,900 51,836 7.034% due 09/17/2002 (d) 2,000 2,004 The Money Store, Inc. 8.050% due 04/15/2002 300 309 7.300% due 12/01/2002 100 103 Tokai Capital Corp. 9.980% due 12/29/2049 (d) 9,735 8,120 Toyota Motor Credit Corp. 7.325% due 02/15/2002 (d) 40,000 40,068 Transamerica Finance Corp. 6.798% due 09/17/2001 (d) 12,000 12,000 6.125% due 11/01/2001 29,000 29,187 6.830% due 12/14/2001 (d) 64,300 64,320 5.920% due 03/29/2002 52,050 52,572 7.250% due 08/15/2002 86,195 88,243 7.500% due 03/15/2004 270 283 U.S. Bancorp 6.750% due 01/16/2002 (d) 49,000 49,024 5.755% due 02/03/2003 (d) 18,100 18,166 6.924% due 03/06/2003 600 602 6.500% due 06/15/2004 600 616 UBS Preferred Funding Trust I 8.622% due 10/29/2049 38,900 43,083 Wachovia Corp. 6.375% due 04/15/2003 200 204 6.075% due 05/02/2005 (d) 78,100 78,007 Washington Mutual Capital I 8.375% due 06/01/2027 235 225 Wells Fargo & Co. 8.750% due 05/01/2002 100 104 6.500% due 09/03/2002 100 102 6.625% due 07/15/2004 6,500 6,740 6.025% due 05/02/2005 (d) 77,300 77,235 Wells Fargo Financial, Inc. 6.375% due 07/16/2002 500 509 6.250% due 11/01/2002 100 102 7.000% due 01/15/2003 380 393 6.000% due 02/01/2004 50 51 10.875% due 04/15/2001 200 200 Westdeutsche Landesbank 6.750% due 06/15/2005 36,400 37,341 6.050% due 01/15/2009 164,600 162,284 ------------ 9,355,068 ------------ Industrials 7.0% AIC Corp. 6.965% due 10/02/2002 (d) 10,000 9,983 Air Products & Chemicals, Inc. 6.250% due 06/15/2003 2,500 2,533 Akzo Nobel, Inc. 6.000% due 11/15/2003 32,000 32,319 Allied Waste North America, Inc. 7.375% due 01/01/2004 18,925 18,641 Alpha Wind 11.321% due 05/23/2001 (d) 17,200 17,200 America West Airlines, Inc. 6.870% due 07/02/2018 1,820 1,739 American Airlines, Inc. 10.210% due 01/01/2010 6,500 7,188 10.610% due 03/04/2011 1,895 2,160 Amoco Corp. 6.250% due 10/15/2004 1,000 1,035 AMR Corp. 9.400% due 05/08/2001 3,000 3,005 9.430% due 05/10/2001 1,000 1,002 9.500% due 05/15/2001 6,480 6,495 9.130% due 10/25/2001 2,000 2,042 8.470% due 02/20/2002 2,000 2,036 8.500% due 02/26/2002 1,000 1,018 Anheuser-Busch Companies, Inc. 6.750% due 08/01/2003 500 524 Atlas Air, Inc. 9.504% due 10/04/2004 (d) 22,700 22,700 10.504% due 10/04/2004 (d) 3,000 3,000 Baxter International, Inc. 9.500% due 06/15/2008 200 237 Bayer Corp. 6.500% due 10/01/2002 250 255 Boeing Co. 6.350% due 06/15/2003 750 777 Boise Cascade Corp. 7.150% due 05/15/2001 10,000 10,005 Browning-Ferris Industries, Inc. 6.100% due 01/15/2003 (d) 6,000 5,844 Campbell Soup Co. 4.750% due 10/01/2003 700 690 Cargill, Inc. 6.871% due 01/14/2002 (d) 11,700 11,704 Cemex SA de CV 9.250% due 06/17/2002 5,000 5,144 8.625% due 07/18/2003 48,250 49,698 Champion International Corp. 9.700% due 05/01/2001 4,000 4,013 Clear Channel Communications, Inc. 7.210% due 06/15/2002 (d) 20,000 20,056 Coastal Corp. 5.554% due 03/06/2002 (d) 146,350 146,350 8.125% due 09/15/2002 250 258 Coca-Cola Enterprises, Inc. 6.375% due 08/01/2001 500 502 7.875% due 02/01/2002 100 103 6.000% due 07/15/2003 250 255 5.750% due 11/01/2008 100 99 Colgate-Palmolive Co. 6.000% due 08/15/2003 45 46 Comcast Cable Communications 8.375% due 05/01/2007 145 159 Continental Airlines, Inc. 6.410% due 04/15/2007 337 343 6.800% due 07/02/2007 25 25 6.954% due 02/02/2011 22,768 23,011 6.900% due 01/02/2018 1,468 1,499 102 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Cox Communications, Inc. 7.000% due 08/15/2001 $ 1,500 $ 1,506 6.500% due 11/15/2002 200 202 Cox Enterprises, Inc. 6.625% due 06/14/2002 7,250 7,334 6.425% due 05/01/2033 (d) 500 500 CSX Corp. 7.260% due 06/24/2002 (d) 30,700 30,721 DaimlerChrysler North America Holding Corp. 6.630% due 09/21/2001 1,000 1,008 6.899% due 01/18/2002 (d) 41,000 40,802 7.125% due 03/01/2002 16,500 16,604 5.640% due 08/23/2002 (d) 15,400 15,272 5.790% due 12/16/2002 (d) 93,100 92,715 7.750% due 05/27/2003 45,000 46,563 5.720% due 08/16/2004 (d) 76,600 74,666 7.250% due 01/18/2006 40,000 41,055 Delta Air Lines Equipment Trust 9.230% due 07/02/2002 (l) 1,956 2,034 10.500% due 01/02/2007 (l) 7,372 8,536 10.570% due 01/02/2007 (l) 15,881 18,571 10.370% due 01/02/2007 (l) 9,629 10,978 9.550% due 01/02/2008 (l) 7,773 8,845 10.430% due 01/02/2011 1,810 1,949 10.140% due 08/14/2012 1,000 1,102 10.000% due 06/05/2013 10,828 11,446 Delta Air Lines, Inc. 6.650% due 03/15/2004 13,500 13,208 7.379% due 05/18/2010 8,200 8,704 9.200% due 09/23/2014 6,000 6,031 10.500% due 04/30/2016 6,050 6,935 Duty Free International, Inc. 7.000% due 01/15/2004 175 177 Eastman Chemical Co. 6.375% due 01/15/2004 5,750 5,608 Electric Lightwave, Inc. 6.050% due 05/15/2004 10,700 9,779 Eli Lilly & Co. 8.125% due 12/01/2001 500 511 6.250% due 03/15/2003 100 102 Enron Corp. 5.510% due 09/10/2001 (d) 35,000 35,029 6.450% due 11/15/2001 5,275 5,311 8.375% due 05/23/2005 12,000 13,010 Federal Express Corp. 6.845% due 01/15/2019 811 809 Ford Capital BV 9.375% due 05/15/2001 300 301 9.500% due 06/01/2010 200 229 Ford Motor Co. 9.000% due 09/15/2001 980 996 6.625% due 10/01/2028 115,800 102,927 7.450% due 07/16/2031 10,000 9,855 7.400% due 11/01/2046 2,380 2,234 Fortune Brands, Inc. 8.500% due 10/01/2003 500 535 Fred Meyer, Inc. 7.150% due 03/01/2003 13,000 13,480 7.375% due 03/01/2005 38,100 39,911 General Foods Corp. 6.000% due 06/15/2001 200 200 General Motors Corp. 9.125% due 07/15/2001 100 101 6.250% due 05/01/2005 300 303 Gillette Co. 6.250% due 08/15/2003 750 773 5.750% due 10/15/2005 1,500 1,520 Grupo Elektra SA 12.750% due 05/15/2001 1,000 1,005 Harrahs Operating Co., Inc. 7.875% due 12/15/2005 5,000 5,025 HCA - The Healthcare Co. 8.020% due 08/05/2002 9,000 9,201 8.049% due 09/19/2002 (d) 60,500 60,497 8.130% due 08/04/2003 7,300 7,568 6.910% due 06/15/2005 9,500 9,352 6.630% due 07/15/2045 10,000 10,101 6.730% due 07/15/2045 22,560 22,797 Heinz (H.J.) Co. 6.875% due 01/15/2003 100 103 Hilton Hotels Corp. 7.375% due 06/01/2002 1,000 1,009 HNA Holdings, Inc. 6.125% due 02/01/2004 200 207 Houghton Mifflin Co. 5.990% due 12/03/2001 3,000 3,012 IBM Corp. 7.250% due 11/01/2002 625 645 ICI Wilmington, Inc. 6.750% due 09/15/2002 10,000 10,119 IMEXSA Export Trust 10.125% due 05/31/2003 7,091 6,907 Imperial Tobacco Overseas BV 7.125% due 04/01/2009 21,785 21,378 International Game Technology 7.875% due 05/15/2004 14,500 14,718 International Paper Co. 7.000% due 06/01/2001 2,000 2,005 6.666% due 07/08/2002 (d) 48,600 48,657 Kroger Co. 6.340% due 06/01/2001 50,924 50,984 Lockheed Martin Corp. 6.850% due 05/15/2001 89,064 89,188 Mandalay Resort Group 6.750% due 07/15/2003 4,500 4,354 Martin Marietta Corp. 6.500% due 04/15/2003 50 51 Mazda Manufacturing Corp. 10.500% due 07/01/2008 (l) 1,980 2,510 Nabisco, Inc. 6.800% due 09/01/2001 3,000 3,006 6.700% due 06/15/2002 9,000 9,045 6.125% due 02/01/2033 15,000 15,079 News America Holdings, Inc. 8.625% due 02/01/2003 750 786 Norfolk Southern Corp. 6.950% due 05/01/2002 12,000 12,196 7.875% due 02/15/2004 50 53 Northwest Airlines, Inc. 8.970% due 01/02/2015 1,576 1,684 8.072% due 10/01/2019 400 437 Occidental Petroleum Corp. 6.400% due 04/01/2003 17,710 17,834 Park Place Entertainment Corp. 7.950% due 08/01/2003 18,500 19,009 Petroleos Mexicanos 7.769% due 07/15/2005 (d) 32,250 32,331 7.845% due 07/15/2005 (d) 94,000 94,235 8.850% due 09/15/2007 1,800 1,852 9.375% due 12/02/2008 39,650 41,335 9.500% due 09/15/2027 31,000 32,473 Philip Morris Cos., Inc. 8.750% due 06/01/2001 7,735 7,775 6.000% due 07/15/2001 1,000 999 7.250% due 09/15/2001 3,770 3,797 7.500% due 01/15/2002 50 51 7.625% due 05/15/2002 8,300 8,475 6.800% due 12/01/2003 48,345 49,880 7.000% due 07/15/2005 15,125 15,646 6.950% due 06/01/2006 9,540 9,552 7.200% due 02/01/2007 34,000 35,278 Phillips Petroleum Co. 9.000% due 06/01/2001 2,000 2,010 Premium Asset Trust 7.029% due 09/08/2007 25,000 24,938 Procter & Gamble Co. 5.250% due 09/15/2003 35,900 36,220 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 103 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Racers 6.930% due 03/03/2003 (d) $ 282,400 $ 282,549 6.209% due 04/01/2003 (d) 20,000 19,956 8.760% due 04/28/2003 (d) 30,000 30,735 6.800% due 09/15/2005 (d) 15,000 14,967 Raytheon Co. 5.739% due 08/10/2001 (d) 74,100 74,186 7.310% due 03/01/2002 (d) 8,650 8,656 Rollins Truck Leasing Co. 8.250% due 05/01/2002 13,400 13,762 Saferco 9.590% due 05/31/2001 3,000 3,021 Safeway, Inc. 7.000% due 09/15/2002 1,125 1,146 6.850% due 09/15/2004 250 260 Sara Lee Corp. 6.300% due 11/07/2005 500 511 Scotia Pacific Co. LLC 7.710% due 01/20/2014 (d) 305 224 Sears, Roebuck & Co. 8.390% due 02/14/2002 240 245 6.250% due 01/15/2004 300 301 SmithKline Beecham Corp. 7.375% due 04/15/2005 150 160 Sun Microsystems, Inc. 7.000% due 08/15/2002 200 202 TCI Communications, Inc. 7.176% due 04/03/2002 (d) 11,600 11,664 5.580% due 03/11/2003 (d) 5,000 5,030 6.375% due 05/01/2003 3,280 3,311 8.650% due 09/15/2004 625 672 8.000% due 08/01/2005 450 478 Tele-Communications, Inc. 8.250% due 01/15/2003 43,125 45,078 Tenet Healthcare Corp. 7.875% due 01/15/2003 10,300 10,519 8.625% due 12/01/2003 6,200 6,441 Texaco Capital, Inc. 8.500% due 02/15/2003 700 745 6.000% due 06/15/2005 400 409 Textron, Inc. 6.750% due 09/15/2002 225 229 Time Warner, Inc. 6.100% due 12/30/2001 41,875 42,043 7.975% due 08/15/2004 19,770 21,087 Times Mirror Co. 6.650% due 10/15/2001 300 303 TRW, Inc. 6.450% due 06/15/2001 31,135 31,102 6.625% due 06/01/2004 8,925 8,856 Tyco International Group SA 6.125% due 06/15/2001 5,600 5,605 6.875% due 09/05/2002 675 685 Union Pacific Corp. 7.875% due 02/15/2002 8,000 8,156 7.365% due 07/01/2002 (d) 25,500 25,543 6.930% due 06/01/2003 1,000 1,030 6.000% due 09/01/2003 8,000 8,000 6.120% due 02/01/2004 250 249 Unisys Corp. 9.210% due 01/21/2017 2,000 2,114 United Air Lines, Inc. 9.200% due 03/22/2008 3,950 4,311 10.360% due 11/13/2012 7,000 7,826 10.020% due 03/22/2014 6,925 7,490 10.850% due 07/05/2014 34,111 39,667 10.850% due 02/19/2015 1,500 1,725 10.125% due 03/22/2015 14,300 15,651 9.060% due 06/17/2015 5,000 5,095 United Technologies Corp. 7.125% due 11/15/2010 450 486 US Airways, Inc. 6.850% due 01/30/2018 143 138 UST, Inc. 7.250% due 06/01/2009 15,000 14,278 USX Corp. 9.800% due 07/01/2001 24,050 24,294 Wal-Mart Stores, Inc. 8.625% due 04/01/2001 2,450 2,450 6.150% due 08/10/2001 450 452 6.750% due 05/24/2002 170 173 6.500% due 06/01/2003 200 207 Walt Disney Co. 5.125% due 12/15/2003 500 499 Waste Management, Inc. 6.700% due 05/01/2001 10,000 10,002 6.000% due 05/15/2001 28,800 28,762 6.125% due 07/15/2001 23,900 23,857 6.375% due 12/01/2003 200 200 6.500% due 05/15/2004 94,000 94,015 Witco Corp. 6.600% due 04/01/2003 100 99 Yorkshire Power 6.154% due 02/25/2003 17,000 17,008 ------------ 2,972,965 ------------ Utilities 5.9% Alabama Power Co. 5.350% due 11/15/2003 1,600 1,590 Allete 6.499% due 10/20/2003 (d) 79,700 79,786 Appalachian Power Co. 7.270% due 06/27/2001 (d) 20,000 20,006 Arizona Public Service Co. 6.109% due 11/15/2001 (d) 14,000 14,015 Ashland, Inc. 8.450% due 12/05/2001 3,000 3,069 7.253% due 03/07/2003 (d) 300 300 AT&T Canada, Inc. 0.000% due 11/01/2007 1,000 899 0.000% due 06/15/2008 14,630 12,178 AT&T Corp. 5.125% due 04/01/2001 600 600 7.350% due 08/27/2001 7,200 7,258 7.125% due 01/15/2002 275 278 Baltimore Gas & Electric 6.125% due 07/01/2003 150 153 Bell Atlantic Maryland, Inc. 8.000% due 10/15/2029 1,125 1,217 Bell Atlantic Virginia, Inc. 5.625% due 03/01/2007 500 486 BellSouth Telecommunications, Inc. 6.000% due 06/15/2002 10,000 10,119 6.250% due 05/15/2003 100 102 British Telecommunications PLC 6.079% due 12/15/2003 (d) 94,800 94,839 7.625% due 12/15/2005 5,000 5,179 8.125% due 12/15/2010 (d) 83,000 86,717 Calpine Corp. 9.250% due 02/01/2004 4,150 4,152 CE Electric Funding 6.853% due 12/30/2004 250 252 Central Maine Power Co. 7.430% due 08/25/2003 13,000 13,552 Central Power & Light Co. 7.351% due 11/23/2001 (d) 18,100 18,121 Cleveland Electric Illuminating Co. 9.500% due 05/15/2005 33,000 34,158 CMS Energy Corp. 8.375% due 07/01/2003 15,000 15,276 7.000% due 01/15/2005 41,325 39,637 8.000% due 07/01/2011 1,000 1,002 Columbia Energy Group 6.610% due 11/28/2002 5,000 5,094 Columbus Southern Power Co. 6.850% due 10/03/2005 10,000 10,299 104 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Commonwealth Edison Co. 6.625% due 07/15/2003 $ 1,000 $ 1,025 7.145% due 09/30/2003 (d) 17,700 17,706 9.875% due 06/15/2020 11,700 13,213 Connecticut Light & Power Co. 7.875% due 06/01/2001 5,100 5,119 7.750% due 06/01/2002 5,000 5,116 8.590% due 06/05/2003 27,000 29,085 Consolidated Edison, Inc. 6.625% due 02/01/2002 100 101 6.720% due 06/15/2002 (d) 11,000 11,014 6.375% due 04/01/2003 1,000 1,018 Consolidated Natural Gas Co. 7.250% due 10/01/2004 43,750 45,631 Constellation Energy Group 7.219% due 04/04/2003 (d) 15,000 14,971 Detroit Edison Co. 7.210% due 08/01/2002 1,000 1,029 6.341% due 07/15/2028 1,000 993 Dominion Resources, Inc. 7.600% due 07/15/2003 35,000 36,440 DTE Capital Corp. 8.350% due 11/15/2038 (d) 90,250 92,148 Duke Energy Corp. 5.875% due 06/01/2001 375 375 El Paso Electric Co. 9.400% due 05/01/2011 7,455 8,269 El Paso Energy Corp. 6.625% due 07/15/2001 27,000 27,119 El Paso Natural Gas Co. 7.750% due 01/15/2002 15,000 15,264 Entergy Arkansas, Inc. 7.000% due 03/01/2002 3,580 3,620 7.720% due 03/01/2003 200 207 Entergy Gulf States, Inc. 6.410% due 08/01/2001 5,800 5,819 Entergy Louisiana, Inc. 7.740% due 07/01/2002 599 600 8.500% due 06/01/2003 3,000 3,162 Entergy Mississippi, Inc. 7.409% due 05/03/2004 (d) 31,000 31,008 Exelon Corp. 5.625% due 11/01/2001 22,350 22,419 Florida Power & Light 6.875% due 12/01/2005 4,000 4,191 France Telecom 6.308% due 03/14/2003 (d) 83,200 83,246 Georgia Power Co. 5.620% due 02/22/2002 (d) 15,000 15,004 Global Crossing Ltd. 8.950% due 08/07/2001 3,000 3,040 GTE California, Inc. 5.500% due 01/15/2009 100 95 GTE South, Inc. 7.250% due 08/01/2002 150 154 Houston Lighting & Power Co. 8.750% due 03/01/2022 10,000 10,496 Indiana Bell Telephone Co., Inc. 5.500% due 04/01/2007 500 479 Indiana Michigan Power Co. 7.305% due 09/03/2002 (d) 5,000 5,004 Indianapolis Power & Light Co. 7.375% due 08/01/2007 225 237 Kinder Morgan, Inc. 6.450% due 11/30/2001 10,000 10,052 6.450% due 03/01/2003 240 243 Korea Electric Power Corp. 7.000% due 10/01/2002 380 385 6.375% due 12/01/2003 220 221 Marlin Water Trust 7.090% due 12/15/2001 11,238 11,337 Mirant Corp. 7.900% due 07/15/2009 175 174 Montana Power Co. 7.053% due 04/06/2001 (d) 15,000 15,008 National Power Corp. 9.625% due 05/15/2028 16,000 11,131 Nevada Power Co. 5.990% due 08/20/2001 (d) 1,200 1,201 6.200% due 04/15/2004 20,000 19,596 New England Telephone & Telegraph Co. 6.250% due 03/15/2003 50 51 6.375% due 09/01/2008 1,350 1,316 New York Telephone Co. 6.250% due 02/15/2004 150 153 6.000% due 04/15/2008 45 45 Niagara Mohawk Power Co. 7.125% due 07/01/2001 34,644 34,786 7.250% due 10/01/2002 24,783 25,309 7.375% due 07/01/2003 39,162 40,170 7.375% due 08/01/2003 1,645 1,709 NorAm Energy Corp. 8.920% due 05/15/2001 7,000 7,026 6.375% due 11/01/2003 22,250 22,726 Nortel Networks Corp. 8.750% due 06/12/2001 300 302 6.875% due 10/01/2002 200 204 Northern Illinois Gas Co. 6.450% due 08/01/2001 1,450 1,454 NRG Energy, Inc. 8.000% due 11/01/2003 6,000 6,185 NRG Northeast Generating LLC 8.065% due 12/15/2004 422 435 Ohio Bell Telephone Co. 5.375% due 03/01/2007 950 906 Ohio Power Co. 7.000% due 07/01/2004 24,000 24,642 Oneok, Inc. 7.390% due 04/24/2002 (d) 8,000 8,014 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(e) 33,700 27,803 5.875% due 10/01/2005 (e) 100 85 7.375% due 11/01/2005 (e) 22,000 16,830 7.250% due 08/01/2026 (e) 10,000 8,350 Pacific Northwest Bell Telephone 4.375% due 09/01/2002 50 49 Portland General Electric Co. 7.660% due 01/14/2002 5,000 5,103 PP&L, Inc. 6.125% due 05/01/2001 (d) 16,102 16,110 6.550% due 03/01/2006 500 510 PSEG Energy Holdings, Inc. 9.125% due 02/10/2004 120 124 Public Service Co. of Colorado 6.000% due 04/15/2003 750 759 Public Service Electric & Gas Co. 7.250% due 04/01/2001 (d) 3,191 3,191 6.125% due 08/01/2002 1,000 1,010 6.250% due 01/01/2007 1,500 1,505 Public Service Enterprise Group, Inc. 7.035% due 06/15/2001 (d) 156,200 156,327 Queststar Pipeline Co. 9.375% due 06/01/2021 200 210 RAS LAFFAN Liquid Natural Gas 8.294% due 03/15/2014 145 145 Reliant Energy, Inc. 9.375% due 06/01/2001 2,000 2,008 Scana Corp. 5.910% due 02/08/2002 (d) 13,900 13,918 6.329% due 07/15/2002 (d) 38,800 38,871 Sierra Pacific Power Co. 7.160% due 06/12/2001 (d) 46,000 46,000 Sierra Pacific Resources 6.299% due 04/20/2002 (d) 500 425 6.249% due 04/20/2003 (d) 2,000 1,700 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 105 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Sonat, Inc. 9.000% due 05/01/2001 $ 100 $ 100 Southern California Edison Co. 6.500% due 06/01/2001 200 167 7.204% due 05/01/2002 (d) 24,000 19,560 Sprint Capital Corp. 9.500% due 06/06/2001 150 151 5.679% due 11/15/2001 (d) 144,900 145,094 6.500% due 11/15/2001 14,365 14,472 7.010% due 06/10/2002 (d) 14,400 14,422 7.625% due 06/10/2002 7,000 7,177 6.850% due 06/24/2002 (d) 62,500 62,562 8.125% due 07/15/2002 10,378 10,652 System Energy Resources, Inc. 7.710% due 08/01/2001 5,800 5,843 TECO Energy, Inc. 5.540% due 09/15/2001 44,630 44,796 Telekomunikacja Polska SA 7.125% due 12/10/2003 12,200 12,250 7.750% due 12/10/2008 7,895 7,663 Tennessee Valley Authority 0.000% due 04/15/2042 855 410 Texas Utilities Corp. 5.420% due 06/25/2001 (d) 173,900 173,875 6.370% due 08/16/2001 1,000 1,004 7.389% due 09/24/2001 (d) 160,100 158,574 5.940% due 10/15/2001 3,000 3,014 6.500% due 08/16/2002 2,600 2,635 6.750% due 03/01/2003 150 153 Toledo Edison Co. 8.180% due 07/30/2002 1,400 1,440 8.700% due 09/01/2002 24,500 25,208 7.850% due 03/31/2003 7,000 7,226 7.875% due 08/01/2004 500 531 Transcontinental Gas Pipe Corp. 7.080% due 07/15/2026 15,000 15,055 TXU Eastern Funding Co. 6.150% due 05/15/2002 61,800 62,109 6.450% due 05/15/2005 15,270 15,218 Union Electric Co. 8.000% due 12/15/2022 1,000 1,022 Vodafone Group PLC 6.736% due 12/19/2001 (d) 23,900 23,940 7.750% due 02/15/2010 500 540 Western Massachusetts Electric Co. 7.375% due 07/01/2001 23,235 23,303 Williams Cos., Inc. 5.889% due 11/15/2001 (d) 26,800 26,839 6.200% due 08/01/2002 5,000 5,032 Wilmington Trust Co. - Tucson Electric 10.732% due 01/01/2013 (l) 991 1,094 WorldCom, Inc. 6.125% due 08/15/2001 3,030 3,035 6.981% due 11/26/2001 (d) 22,100 22,037 8.875% due 01/15/2006 3,000 3,099 6.125% due 04/15/2012 1,250 1,252 ------------ 2,503,119 ------------ Total Corporate Bonds & Notes 14,831,152 (Cost $14,798,070) ------------ -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 1.0% -------------------------------------------------------------------------------- Alabama 0.0% Jefferson County, Alabama Sewer Revenue Warrants, (FGIC Insured), Series 2001 5.000% due 02/01/2041 5,000 4,694 Jefferson County, Alabama Sewer Revenue Bonds Warrants, (FGIC Insured), Series 2000-323 6.560% due 02/01/2029 (d) 4,500 4,337 Jefferson County, AIabama Sewer Revenue Bonds Warrants, (FGIC Insured), Series 2000-352 5.912% 625 573 due 02/01/2036 (d) Jefferson County, Alabama Sewer Revenue Bonds, (FGIC Insured), Series 2001 6.940% due 02/01/2039 5,500 5,170 Montgomery Alabama Special Care Facilities Financing Authority Revenue Bonds, (MBIA Insured), Series 2000 5.410% due 11/15/2029 1,000 890 ------------ 15,664 ------------ California 0.1% California State Department of Water Resources Center Valley Project Revenue Bonds, Series 2000 6.030% due 12/01/2029 2,500 2,378 California State General Obligation Bonds, Series 2000 7.290% due 05/01/2026 2,635 2,875 Fairfield California Redevelopment Agency Tax Allocation, Series 1997 7.700% due 06/01/2002 10 10 Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, Series 1995 0.000% due 01/01/2026 9,000 2,449 0.000% due 01/01/2030 3,590 785 Los Angeles County Metropolitan Transportation Authority Sales Tax Revenue Bonds, (AMBAC Insured), Series 2000 5.740% due 07/01/2023 3,500 3,434 Los Angeles, California Wastewater System Revenue Bonds, (FGIC Insured), Series 2000 6.700% due 6,500 6,313 06/01/2028 Modesto California Financing Authority Revenue, (AMBAC Insured), Series 1998 5.000% due 09/01/2029 300 295 Orange County School Board, (MBIA Insured), Series 2000 5.710% due 08/01/2024 3,500 3,360 Port of Oakland, California Revenue Bonds, (FGIC Insured), Series 2000 5.750% due 11/01/2029 1,000 1,054 San Diego Public Facilities Financing Authority Revenue Bonds, (FGIC Insured), Series 1999 5.000% due 05/15/2029 1,000 984 San Francisco, California City & County Common International Airport Revenue Bonds, (MBIA Insured), Series 2000 4.840% due 05/01/2028 3,350 2,680 ------------ 26,617 ------------ Colorado 0.0% Denver Colorado City & County Airport Revenue Bonds, Series 2000 5.980% due 11/15/2025 2,500 2,356 E-470 Public Highway Authority Revenue Bonds, (MBIA Insured), Series 2000 5.750% due 09/01/2035 2,500 2,659 ------------ 5,015 ------------ Florida 0.1% Broward County Florida Airport System Revenue, (AMBAC Insured), Series 2000 5.030% due 10/01/2023 1,328 1,176 Florida State Board of Education General Obligation, (FGIC Insured), Series 2000 4.710% due 06/01/2023 3,500 2,835 Florida State Governmental Utility Authority Utility Revenue, (AMBAC Insured), Series 2000 5.710% due 10/01/2029 6,453 6,073 Florida State Turnpike Authority Revenue Bonds, (FGIC Insured), Series 2000 4.440% due 07/01/2027 6,323 4,932 Greater Orlando Aviation Authority, Orlando Florida Airport Facilities Revenue Bonds, (FGIC Insured), Series 1999 5.125% due 10/01/2028 2,000 1,940 106 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Lakeland Florida Electric & Water Revenue Bonds, (MBIA Insured), Series 2000 5.000% due 10/01/2028 $ 2,675 $ 2,528 Modesto Public Financing Authority Lease Revenue, (AMBAC Insured), Series 2000 5.740% due 09/01/2029 2,500 2,419 Tampa, Florida Guaranteed Entitlement Revenue, (AMBAC Insured), Series 2001 6.000% due 10/01/2005 2,230 2,433 Tampa, Florida Utility Tax & Special Revenue, (AMBAC Insured), Series 2001 6.000% due 10/01/2005 3,000 3,278 6.000% due 10/01/2008 1,500 1,682 ------------ 29,296 ------------ Georgia 0.1% Atlanta, Georgia Airport Revenue, (FGIC Insured), Series 2000 5.500% due 01/01/2026 1,000 1,035 Atlanta, Georgia Water & Wastewater Revenue Bonds, (FGIC Insured), Series 2000 5.440% due 11/01/2038 22,300 20,405 Georgia Local Government Certificate Of Participation, (MBIA Insured), Series 2000 5.810% due 06/01/2028 9,950 8,706 ------------ 30,146 ------------ Hawaii 0.0% Honolulu Hawaii City & County Wastewater System Revenue Bonds, (FGIC Insured), Series 2000 5.290% due 07/01/2023 3,468 3,259 5.210% due 07/01/2028 7,200 6,048 ------------ 9,307 ------------ Illinois 0.1% Chicago, IIlinois Skyway Toll Bridge Revenue Bonds, (AMBAC Insured), Series 2000 5.500% due 01/01/2031 2,000 2,045 Chicago, Illinois Board Education General Obligation, (FGIC Insured), Series 1998 0.000% due 12/01/2027 15,000 3,525 Chicago, Illinois General Obligations, (FGIC Insured), Series 2000 5.500% due 01/01/2035 2,500 2,550 5.500% due 01/01/2040 3,000 3,049 6.980% due 01/01/2040 4,750 4,904 Chicago, Illinois Midway Airport Revenue Bonds, (MBIA Insured), Series 1998 5.000% due 01/01/2035 7,000 6,641 Chicago, Illinois Residual General Obligation, (MBIA Insured), Series 2000 5.960% due 01/01/2028 3,100 2,945 Chicago, Illinois Sales Tax Revenue Bonds, (FGIC Insured), Series 1999 5.375% due 01/01/2030 15,000 15,098 Cook County Illinois General Obligation, (FGIC Insured), Series 2000 5.000% due 11/15/2028 3,220 2,942 Cook County Illinois General Obligation, (FGIC Insured), Series 2001 6.690% due 11/15/2028 3 2 ------------ 43,701 ------------ Kansas 0.0% Wichita, Kansas Hospital Revenue Bonds, Series 1999 6.250% due 11/15/2024 1,000 1,054 ------------ Massachusetts 0.2% Boston Massachussetts Water & Sewer Common Revenue Bonds, (FGIC Insured), Series 2000 5.510% due 11/01/2028 3,500 3,255 E-470 Public Highway Residual 144a Revenue Bonds, (MBIA Insured), Series 2000 5.710% due 09/01/2021 2,590 2,545 Massachusetts Bay Transportation Authority Revenue Bonds, (MBIA Insured), Series 2000 5.260% due 03/01/2021 4,150 3,709 Massachusetts State Turnpike Authority Metro Highway System Revenue Bonds, (MBIA Insured), Series 1997 5.000% due 01/01/2037 6,000 5,648 Massachusetts State Turnpike Authority Revenue Bonds, (AMBAC Insured), Series 2000 5.910% due 01/01/2039 10,250 9,084 Massachusetts State Turnpike Authority Revenue Bonds, (MBIA Insured), Series 2000 7.960% due 01/01/2037 21,050 19,603 Southbridge Associations Limited Liability Corporation Massachussetts, (MBIA-Insured), Series 2000 7.590% due 02/01/2022 31,105 32,621 ------------ 76,465 ------------ Minnesota 0.0% Minnesota Agricultural & Economic Development Board Revenue Bonds, Series 2000 6.375% due 11/15/2029 1,000 1,055 ------------ Mississippi 0.0% Mississippi Development Bank Special Obligation, (AMBAC Insured), Series 2000 5.810% due 07/01/2024 2,500 2,400 ------------ Nevada 0.1% Clark County Nevada General Obligations, (MBIA Insured), Series 2000 8.440% due 07/01/2030 20,913 21,801 Clark County Passenger Facility Charge Revenue, (MBIA Insured), Series 2000 5.210% due 07/01/2022 4,750 4,192 ------------ 25,993 ------------ New Jersey 0.0% Essex County New Jersey Important Authority Lease Revenue Bonds, (FGIC Insured), Series 2000 7.090% due 10/01/2030 250 280 Mercer County New Jersey Important Authority Revenue Bonds, Series 2000 7.140% due 01/01/2018 3,103 3,669 New Jersey Health Care Facilities Financing Authority Revenue Bonds, (MBIA Insured), Series 2000 5.130% due 07/01/2028 2,000 1,740 ------------ 5,689 ------------ New York 0.2% Long Island Power Authority New York Electric System Revenue Bonds, (FSA Insured), Series 2001 7.040% due 12/01/2022 4,000 4,000 Long Island Power Authority Revenue Bonds, (FSA Insured), Series 2000 6.160% due 12/01/2022 4,500 4,410 Long Island Power Authority Revenue Bonds, (MBIA Insured), Series 2000 6.410% due 12/01/2026 5,500 5,548 New York City Municipal Bond, Series 1997 7.001% due 08/01/2002 (d) 6,108 6,108 New York City Municipal Water Finance Authority, (MBIA-Insured), Series 2000 5.130% due 06/15/2025 6,565 5,654 New York City Transitional Finance Authority Revenue Bonds, Series 1998 4.750% due 05/01/2023 6,000 5,610 New York City, New York General Obligation, Series 1997-D 6.899% due 08/01/2002 (d) 9,040 9,040 New York City, New York Municipal Water Financial Authority Water & Sewer System Revenue Bonds, (FSA Insured), Series 2000 5.510% due 06/15/2029 3,000 2,839 New York City, New York Transitional Financial Authority Revenue Bonds, Series 2000 6.510% due 11/01/2024 1,250 1,203 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 107 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- New York City, New York Transitional Financing Authority Revenue Bonds, (FGIC-TCRS Insured), Series 2000 4.790% due 11/15/2023 $ 2,500 $ 2,191 New York State Dormitory Authority Lease Revenue Bonds, (FSA Insured), Series 1998 4.750% due 01/15/2029 7,300 6,709 New York State Dormitory Authority Revenue Bonds, (MBIA Insured), Series 2000 5.000% due 02/15/2023 2,550 2,352 Niagara Frontier Airport Revenue Bonds, (MBIA Insured), Series 1999 5.625% due 04/01/2029 1,000 1,024 Port Authority New York & New Jersey Special Obligation Revenue Bonds, (MBIA Insured), Series 2000 7.600% due 12/01/2022 3,250 3,575 Westchester County New York Health Care Corp. Revenue, Series 2000 5.875% due 11/02/2025 2,875 2,965 ------------ 63,228 ------------ North Dakota 0.0% Mercer County Improvement Authority Revenue Bonds, Series 1978 5.800% due 01/01/2018 55 60 ------------ Ohio 0.0% Hamilton County Ohio Sales Tax Revenue Bonds, (MBIA Insured), Series 2000 5.460% due 12/01/2027 3,250 3,092 ------------ Pennsylvania 0.0% Allegheny County Hospital Development Authority Revenue Bonds, (MBIA Insured), Series 2000 A 6.500% due 11/15/2030 1,000 1,103 Philadelphia School District General Obligation, (MBIA Insured), Series 2000 5.210% due 04/01/2027 3,150 2,705 Pittsburgh & Allegheny County Revenue Bonds, (AMBAC Insured), Series 1999 5.000% due 02/01/2029 500 484 ------------ 4,292 ------------ Puerto Rico 0.0% Puerto Rico Commonwealth General Obligation, (MBIA Insured), Series 2000 5.750% due 07/01/2026 3,990 4,269 Puerto Rico Commonwealth Highway & Transiton Authority Transition Revenue Bonds, (MBIA Insured), Series 2000 5.875% due 07/01/2035 4,930 5,349 ------------ 9,618 ------------ Texas 0.1% Dallas-Fort Worth International Airport Revenue, (FGIC Insured), Series 2000 6.000% due 11/01/2028 4,000 4,220 Denton County, Texas Utility System Revenue Bonds, (MBIA Insured), Series 2000 5.680% due 12/01/2029 3,000 2,876 Grapevine-Colleyville Independent General Obligation, (PSF-GTD Insured), Series 2000 6.000% due 08/15/2029 10,500 8,584 Harris County Health Facilities Development Corporation Revenue, (MBIA Insured), Series 2000 6.140% due 07/01/2021 3,500 3,395 Houston Independent School District General Obligation, (PSF Insured), Series 1999 4.750% due 02/15/2026 15,000 13,725 Houston, Texas Airport System Revenue Bonds, (FGIC Insured), Series 2000 5.290% due 07/01/2025 2,750 2,585 Houston, Texas Airport System Revenue Bonds, (FGIC Insured), Series 2001 5.000% due 07/01/2028 10,000 8,975 Houston, Texas Independent School District (PSF-GTD Insured), Series 2000 4.790% due 02/15/2026 15,088 12,541 Houston, Texas Water & Sewer System Revenue, (FGIC Insured), Series 2000 5.250% due 12/01/2030 1,000 998 North Texas Towey Authority Dallas North Towey System Revenue Bonds, (FGIC Insured), Series 1998 4.750% due 01/01/2029 4,000 3,675 ------------ 61,574 ------------ Utah 0.0% Weber County, Utah Hospital Revenue Bonds, Series 1999 5.000% due 08/15/2030 500 462 ------------ Washington State 0.0% Seattle Washington General Obligation, Series 2000 5.960% due 12/15/2028 3,000 2,925 ------------ Washington, DC 0.0% Washington D.C. Convention Center Authority Dedicated Tax Revenue, (AMBAC Insured), Series 2000 5.030% due 10/01/202 6,500 5,363 ------------ Total Municipal Bonds & Notes 423,016 (Cost $385,483) ------------ -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 1.1% -------------------------------------------------------------------------------- A.I.D. Housing Guarantee - Peru 9.980% due 08/01/2008 825 846 Fannie Mae 6.590% due 05/24/2001 500 501 0.000% due 08/15/2001 105 103 6.100% due 09/14/2001 100 101 5.375% due 03/15/2002 750 756 6.500% due 09/05/2002 325 325 6.250% due 11/15/2002 385 395 5.250% due 01/15/2003 250 253 6.030% due 05/15/2003 9,950 9,968 4.750% due 11/14/2003 250 250 5.500% due 12/29/2003 500 508 5.125% due 02/13/2004 4,594 4,648 5.625% due 05/14/2004 1,525 1,558 5.750% due 06/15/2005 900 919 6.625% due 10/15/2007 650 692 6.560% due 12/10/2007 190 195 5.750% due 02/15/2008 400 406 6.000% due 05/15/2008 2,950 3,035 5.250% due 01/15/2009 80 78 5.870% due 01/28/2009 200 198 6.375% due 06/15/2009 2,070 2,168 6.625% due 09/15/2009 1,000 1,062 7.250% due 01/15/2010 2,930 3,238 7.125% due 06/15/2010 60,500 66,580 6.875% due 09/10/2012 1,000 1,050 6.930% due 09/17/2012 1,000 1,057 6.875% due 09/24/2012 2,000 2,109 6.250% due 05/15/2029 2,340 2,344 7.125% due 01/15/2030 325 362 7.250% due 05/15/2030 42 48 Federal Farm Credit Bank 6.400% due 01/16/2002 100 101 5.730% due 03/28/2003 300 306 6.050% due 12/07/2005 200 207 6.060% due 05/28/2013 100 101 Federal Home Loan Bank 6.500% due 04/26/2001 65 65 6.690% due 05/16/2001 400 401 4.875% due 01/22/2002 115 115 5.805% due 02/15/2002 (d) 17,000 17,080 6.210% due 12/30/2002 200 205 5.125% due 09/15/2003 350 354 5.135% due 09/22/2003 600 604 7.350% due 10/06/2003 42,500 42,513 6.000% due 06/30/2004 1,000 1,032 7.360% due 07/01/2004 500 537 6.250% due 08/13/2004 250 260 108 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 5.890% due 06/30/2008 $ 1,000 $ 1,021 5.800% due 09/02/2008 2,000 2,024 6.026% due 01/22/2009 275 273 0.000% due 09/29/2017 2,000 551 0.000% due 09/10/2018 15,000 4,473 0.000% due 12/21/2018 4,250 1,293 Freddie Mac 5.750% due 06/15/2001 668 670 5.500% due 05/15/2002 435 440 7.000% due 02/15/2003 500 521 7.375% due 05/15/2003 3,500 3,692 5.750% due 07/15/2003 350 358 6.250% due 07/15/2004 250 260 6.875% due 01/15/2005 495 525 7.440% due 09/20/2006 1,500 1,520 6.765% due 03/12/2007 400 428 5.750% due 04/15/2008 400 406 9.000% due 09/15/2008 18 19 5.750% due 03/15/2009 1,955 1,968 10.250% due 03/15/2009 8 9 6.625% due 09/15/2009 1,985 2,107 6.750% due 06/03/2013 400 398 SallieMae 5.979% due 10/25/2004 (d) 17,299 17,291 6.896% due 10/25/2004 (d) 11,644 11,632 7.115% due 07/25/2006 (d) 0 0 Small Business Administration 7.449% due 08/01/2010 122,044 128,782 7.700% due 07/01/2016 699 739 6.950% due 11/01/2016 4,149 4,270 6.700% due 12/01/2016 15,898 16,196 7.150% due 03/01/2017 7,636 7,918 7.190% due 12/01/2019 486 505 7.630% due 06/01/2020 23,668 25,069 6.900% due 12/01/2020 10,000 10,186 6.340% due 03/01/2021 33,416 33,416 ------------ Total U.S. Government Agencies 448,594 (Cost $437,557) ------------ -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 13.5% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (i) 3.625% due 07/15/2002 (b) 1,316,075 1,341,986 3.375% due 01/15/2007 (j) 296,572 299,816 3.625% due 01/15/2008 (j) 780,832 799,134 3.875% due 01/15/2009 (j) 474,836 493,829 3.625% due 04/15/2028 (j) 221,455 225,815 3.875% due 04/15/2029 (j) 132,096 141,013 U.S. Treasury Bonds 10.375% due 11/15/2012 305 396 12.000% due 08/15/2013 22,500 32,056 9.250% due 02/15/2016 147,500 203,766 7.250% due 05/15/2016 2,000 2,359 7.500% due 11/15/2016 450 543 8.875% due 02/15/2019 18,675 25,630 8.125% due 08/15/2019 75 97 8.750% due 08/15/2020 208,486 333,200 7.875% due 02/15/2021 1,390 1,766 8.125% due 05/15/2021 85,600 111,454 8.125% due 08/15/2021 14,450 18,841 8.000% due 11/15/2021 5,000 6,450 7.125% due 02/15/2023 204,300 242,660 6.250% due 08/15/2023 12,430 13,404 6.875% due 08/15/2025 11,600 13,495 6.000% due 02/15/2026 156,100 163,719 6.625% due 02/15/2027 700 794 5.500% due 08/15/2028 70,300 69,103 6.125% due 08/15/2029 1 1 U.S. Treasury Notes 6.625% due 07/31/2001 75 76 6.375% due 08/15/2002 4,500 4,631 6.250% due 08/31/2002 1,430 1,470 6.250% due 02/15/2003 1,000 1,036 4.250% due 11/15/2003 85,000 84,811 12.375% due 05/15/2004 (b) 1,000 1,226 6.000% due 08/15/2004 3,500 3,665 5.875% due 11/15/2004 265,700 277,571 6.750% due 05/15/2005 402,300 434,979 6.875% due 05/15/2006 1,000 1,101 5.625% due 05/15/2008 1,625 1,697 5.750% due 08/15/2010 1,830 1,929 5.750% due 11/15/2005 84,800 88,947 U.S. Treasury Strips 0.000% due 11/15/2001 43 42 0.000% due 05/15/2013 4,500 2,356 0.000% due 02/15/2014 64,900 32,157 0.000% due 02/15/2015 105,000 48,595 0.000% due 05/15/2015 182,700 83,082 0.000% due 08/15/2015 170,500 75,697 0.000% due 11/15/2018 108,200 39,243 0.000% due 02/15/2019 2,000 716 0.000% due 05/15/2020 22,000 7,292 ------------ Total U.S. Treasury Obligations 5,733,646 (Cost $5,580,480) ------------ -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 76.8% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 25.2% ABN AMRO Mortgage Corp. 6.750% due 09/25/2028 3,765 3,745 6.750% due 11/25/2028 600 583 6.500% due 06/25/2029 7,093 6,857 American Southwest Financial Securities Corp. 7.400% due 11/17/2004 26,491 27,176 12.500% due 04/01/2015 238 239 12.000% due 05/01/2015 433 447 7.248% due 11/25/2038 56,843 59,232 Amresco Commercial Mortgage Funding I 7.180% due 06/17/2029 55 58 Aurora Loan Services 7.319% due 05/25/2030 (d) 36,969 37,097 Banc of America Funding Corp. 6.750% due 11/20/2032 17,000 17,252 Bank of America Mortgage Securities, Inc. 6.250% due 07/25/2014 9,800 9,734 6.250% due 08/25/2028 25,000 23,769 6.500% due 05/25/2029 35,391 34,371 7.250% due 10/25/2029 10,753 10,841 7.500% due 01/25/2031 166,584 170,203 7.500% due 02/25/2031 12,864 13,167 7.000% due 03/25/2032 53,400 54,220 Bear Stearns Adjustable Rate Mortgage Trust 7.497% due 11/25/2030 (d) 138,892 139,510 7.490% due 12/25/2030 (d) 153,119 154,719 7.499% due 12/25/2030 (d) 156,231 158,008 6.944% due 02/25/2031 (d) 20,835 21,037 7.499% due 02/25/2031 (d) 33,766 34,067 Bear Stearns Commercial Mortgage Securities, Inc. 5.910% due 05/14/2008 131 132 7.000% due 05/20/2030 45,308 46,837 Bear Stearns Mortgage Securities, Inc. 6.097% due 10/25/2023 (d) 2,566 2,716 10.000% due 08/25/2024 5,000 5,645 7.000% due 03/25/2027 7,000 7,095 8.125% due 09/25/2027 2,977 3,071 7.000% due 02/25/2028 10,000 10,168 7.421% due 06/25/2030 (d) 5,972 5,972 Capco America Securitization Corp. 5.860% due 12/15/2007 45 45 CDC Depositor Trust I 6.311% due 01/15/2003 (d) 14,534 14,481 Cendant Mortgage Corp. 7.250% due 04/18/2013 757 761 6.503% due 11/18/2028 (d) 6,148 5,434 6.505% due 11/18/2028 (d) 13,528 13,211 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 109 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Chase Mortgage Finance Corp. 7.000% due 07/25/2024 $ 1,789 $ 1,788 7.000% due 08/25/2024 2,791 2,827 6.750% due 03/25/2025 11,840 11,198 8.494% due 04/25/2025 (d) 8,476 8,650 6.750% due 10/25/2028 39,000 38,987 6.350% due 07/25/2029 62,292 63,147 7.750% due 08/25/2030 9,962 10,403 Chemical Mortgage Securities, Inc. 7.250% due 01/25/2026 11,329 11,644 Citibank, NA 8.000% due 07/25/2018 37 37 Citicorp Mortgage Securities, Inc. 7.963% due 10/25/2022 (d) 8,985 9,117 6.250% due 04/25/2024 11,796 11,249 6.250% due 05/25/2024 1,865 1,864 7.250% due 10/25/2027 20,462 20,811 6.500% due 11/25/2027 14,015 14,013 6.750% due 09/25/2028 9,334 9,343 5.900% due 05/25/2029 2,286 2,280 7.000% due 09/25/2030 7,249 7,166 7.500% due 10/25/2030 11,588 11,773 7.000% due 02/25/2031 34,210 34,131 CMC Securities Corp. II 8.625% due 04/25/2025 (d) 110 109 CMC Securities Corp. III 6.750% due 05/25/2028 5,000 5,040 CMC Securities Corp. IV 7.250% due 11/25/2027 10,436 10,722 Collateralized Mortgage Obligation Trust 7.250% due 04/23/2017 56 57 8.000% due 09/20/2021 5,730 5,845 Collateralized Mortgage Obligation Trust I 10.200% due 02/01/2016 1,957 2,001 Collateralized Mortgage Securities Corp. 11.450% due 11/01/2015 (d) 115 115 8.750% due 04/20/2019 358 371 8.800% due 04/20/2019 237 247 COMM 6.145% due 02/15/2008 14,528 14,739 6.488% due 12/16/2011 (d) 9,000 9,014 Commercial Mortgage Acceptance Corp. 7.030% due 05/15/2009 75 79 Commercial Mortgage Asset Trust 6.640% due 09/17/2010 455 467 6.975% due 04/17/2013 145 151 Countrywide Alternative Loan Trust 8.000% due 07/25/2030 18,606 19,088 Countrywide Funding Corp. 6.625% due 02/25/2024 33,827 33,584 6.750% due 03/25/2024 12,679 12,164 Countrywide Home Loans 6.500% due 07/25/2013 5,676 5,695 6.250% due 08/25/2014 3,718 3,695 8.795% due 07/25/2024 (d) 1,462 1,474 6.750% due 11/25/2025 25,567 25,195 7.500% due 04/25/2027 1,523 1,580 7.500% due 06/25/2027 12,045 12,467 7.500% due 09/25/2027 20,000 20,527 7.250% due 12/25/2027 6,224 6,232 7.250% due 02/25/2028 57,846 58,732 6.750% due 06/25/2028 15,103 14,553 6.750% due 08/25/2028 6,961 6,975 6.750% due 10/25/2028 15,567 15,049 6.750% due 11/25/2028 5,000 4,978 6.500% due 01/25/2029 24,978 24,619 6.500% due 03/25/2029 21,744 21,100 6.050% due 04/25/2029 1,135 1,141 7.250% due 08/25/2029 5,700 5,630 7.750% due 04/25/2030 50,095 51,021 7.750% due 10/25/2030 30,527 30,827 7.750% due 01/25/2031 53,795 55,218 Credit-Based Asset Servicing and Securitization 5.940% due 09/25/2029 (d) 1,102 1,107 7.048% due 02/25/2030 (d) 46,942 46,978 Crusade Global Trust 5.719% due 05/15/2021 (d) 91,106 91,334 CS First Boston Mortgage Securities Corp. 6.960% due 01/20/2004 85 87 6.520% due 07/17/2007 50 51 6.750% due 12/27/2028 13,112 12,841 7.500% due 03/25/2031 50,000 50,491 Dime Savings 7.293% due 11/01/2018 (d) 166 154 DLJ Commercial Mortgage Corp. 6.025% due 09/05/2001 (d) 1,029 1,029 7.571% due 09/05/2001 (d) 2,000 2,010 6.880% due 05/05/2003 (d) 31,164 31,183 DLJ Mortgage Acceptance Corp. 6.446% due 08/01/2021 (d)(l) 3,454 3,454 8.000% due 03/25/2022 111 111 8.874% due 12/25/2022 (d) 1,273 1,289 9.054% due 03/25/2024 (d) 332 337 9.308% due 05/25/2024 (d) 89 90 9.488% due 10/25/2024 (d) 358 380 6.850% due 12/17/2027 6,605 6,835 Drexel Burnham Lambert Trust 9.500% due 11/20/2017 552 565 DVI Business Credit Receivable Corp. III 6.461% due 10/15/2003 (d) 3,850 3,881 Fannie Mae 7.500% due 05/25/2005 6,700 6,908 7.500% due 02/25/2006 375 386 7.000% due 05/25/2006 263 268 6.500% due 07/25/2006 34 34 8.000% due 11/25/2006 20 20 6.350% due 12/25/2006 5 5 7.500% due 05/25/2007 880 897 6.250% due 07/25/2007 52 52 6.000% due 07/25/2007 300 303 6.740% due 08/25/2007 145 151 5.243% due 08/25/2007 (d) 7 7 6.270% due 09/25/2007 3,000 3,049 7.000% due 10/25/2007 200 206 6.500% due 05/25/2008 500 512 10.500% due 08/25/2008 7,146 8,043 6.000% due 08/25/2008 50 50 7.684% due 09/25/2008 (d) 1,606 1,555 6.000% due 02/25/2009 1,400 1,421 4.000% due 02/25/2009 27 26 6.500% due 02/25/2009 50 50 6.500% due 03/25/2009 95 96 6.500% due 08/25/2010 500 500 6.750% due 11/25/2010 655 658 6.500% due 04/25/2013 75 78 6.000% due 03/18/2015 6,888 6,897 6.450% due 09/25/2016 2,334 2,341 8.000% due 12/25/2016 164 170 11.000% due 11/25/2017 919 1,021 9.250% due 04/25/2018 151 163 9.300% due 05/25/2018 614 656 9.500% due 06/25/2018 509 548 6.081% due 06/25/2018 (d) 3 3 6.600% due 09/25/2018 379 378 9.500% due 11/25/2018 5,855 6,066 6.000% due 02/25/2019 3,010 3,018 6.500% due 03/25/2019 818 823 9.500% due 06/25/2019 1,248 1,343 6.350% due 08/25/2019 145 145 9.300% due 08/25/2019 68 73 9.000% due 12/25/2019 5,495 5,804 7.500% due 12/25/2019 68 70 7.000% due 03/25/2020 1,241 1,256 7.000% due 04/25/2020 28 29 7.500% due 05/25/2020 2,809 2,894 110 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 6.044% due 07/18/2020 (d) $ 27 $ 27 6.500% due 09/25/2020 751 751 7.000% due 09/25/2020 8,696 8,738 9.000% due 09/25/2020 2,913 3,095 5.000% due 09/25/2020 200 197 7.125% due 12/25/2020 (d) 4 4 8.000% due 12/25/2020 27,085 28,255 9.000% due 01/25/2021 4,649 4,952 8.750% due 01/25/2021 2,874 3,029 5.750% due 02/18/2021 100 99 9.000% due 03/25/2021 409 433 7.000% due 05/25/2021 300 306 6.500% due 06/25/2021 6,295 6,347 7.500% due 06/25/2021 21 21 8.000% due 07/25/2021 13,648 14,151 8.500% due 09/25/2021 4,817 5,075 7.000% due 10/25/2021 9,647 9,882 8.000% due 10/25/2021 22,645 23,044 7.000% due 11/25/2021 20,052 20,282 6.000% due 12/17/2021 567 567 6.000% due 12/25/2021 24 24 5.000% due 12/25/2021 500 470 4.000% due 01/25/2022 126 121 8.000% due 01/25/2022 21,700 22,213 8.000% due 03/25/2022 49 50 7.000% due 04/25/2022 17,091 17,270 5.000% due 04/25/2022 48 46 7.000% due 04/25/2022 139 139 7.500% due 05/25/2022 2,000 2,083 7.375% due 05/25/2022 9,573 9,800 7.000% due 06/25/2022 1,164 1,192 8.000% due 06/25/2022 4,018 4,221 8.000% due 07/25/2022 59,758 62,379 7.000% due 07/25/2022 5,064 5,195 7.800% due 10/25/2022 3,024 3,154 6.500% due 10/25/2022 4,181 4,171 6.500% due 12/25/2022 180 181 6.500% due 01/25/2023 1,036 113 7.000% due 03/25/2023 29,916 30,517 6.500% due 05/18/2023 9,153 9,219 6.900% due 05/25/2023 165 163 7.000% due 06/25/2023 5,445 5,296 6.500% due 08/25/2023 35 35 6.000% due 08/25/2023 14,106 13,050 6.500% due 09/18/2023 912 922 6.750% due 09/25/2023 4,107 4,039 1.000% due 09/25/2023 171 158 6.750% due 10/25/2023 618 608 6.500% due 10/25/2023 8,895 8,615 7.500% due 10/25/2023 42 43 6.500% due 11/25/2023 85 85 7.100% due 12/25/2023 6,769 6,762 6.500% due 12/25/2023 159 158 6.500% due 01/25/2024 47,302 45,711 5.000% due 01/25/2024 500 487 7.250% due 02/25/2024 4 4 6.500% due 02/25/2024 5,150 5,182 7.000% due 03/25/2024 5,000 5,098 7.500% due 06/20/2024 85 86 6.500% due 08/17/2024 17,000 16,882 6.000% due 12/25/2024 1,750 1,746 8.000% due 02/17/2025 41 41 7.000% due 02/18/2025 94 95 6.600% due 05/18/2025 219 224 7.500% due 11/17/2025 289 300 7.500% due 12/25/2025 360 371 7.000% due 02/15/2026 180 182 6.950% due 03/25/2026 212 213 7.000% due 07/18/2026 450 450 6.500% due 09/18/2026 120 120 7.000% due 12/18/2026 16,889 16,816 6.000% due 12/25/2026 170 168 8.500% due 02/17/2027 1,403 1,531 6.000% due 03/25/2027 320 316 5.000% due 04/18/2027 1,000 952 6.000% due 05/17/2027 5,470 4,931 6.500% due 07/18/2027 178 170 7.000% due 07/18/2027 460 463 8.000% due 08/18/2027 262 43 7.500% due 08/20/2027 2,598 2,701 7.000% due 12/20/2027 12,735 12,744 7.019% due 04/18/2028 (d) 2,877 2,880 6.500% due 06/25/2028 4,700 4,429 6.500% due 07/18/2028 67,412 65,916 6.000% due 07/18/2028 8,867 7,742 9.113% due 09/25/2028 17,398 19,866 6.500% due 10/25/2028 40,000 39,300 6.250% due 02/25/2029 500 469 7.500% due 04/25/2029 1,240 1,272 6.000% due 04/25/2029 11,137 9,546 7.118% due 08/25/2030 (d) 80,172 80,313 6.030% due 10/18/2030 (d) 63,604 63,695 6.390% due 05/25/2036 30,491 28,228 6.500% due 06/17/2038 5,000 5,037 6.300% due 10/17/2038 15,965 15,110 FBS Mortgage Corp. 7.144% due 11/25/2024 150 150 FFCA Secured Lending Corp. 7.850% due 10/18/2017 29,600 30,791 First Commonwealth Savings & Loan 10.375% due 04/01/2005 15 15 First Horizon Asset Securities, Inc. 7.000% due 02/25/2031 20,818 20,794 First Interstate Bancorp 8.875% due 01/01/2009 (l) 143 152 9.125% due 01/01/2009 (d)(l) 9 9 First Nationwide Trust 6.500% due 03/25/2029 4,400 4,334 6.750% due 07/25/2029 1,515 1,512 7.750% due 07/25/2030 6,157 6,406 First Union Residential Securitization, Inc. 7.000% due 04/25/2025 352 357 6.750% due 08/25/2028 9,048 8,656 First Union-Lehman Brothers Commercial Mortgage 7.150% due 02/18/2004 25 26 Freddie Mac 8.000% due 03/15/2002 70 71 7.500% due 04/15/2003 197 197 6.750% due 10/15/2003 12,774 12,866 7.000% due 10/15/2003 2,970 3,018 7.000% due 12/15/2003 76 78 6.500% due 04/15/2005 917 923 10.150% due 04/15/2006 5 5 6.500% due 07/15/2006 4,864 4,888 6.500% due 08/15/2006 349 350 7.500% due 02/15/2007 739 755 7.750% due 04/01/2007 15 15 7.500% due 04/01/2007 12 13 7.000% due 07/01/2007 2 2 6.500% due 07/15/2007 6,057 6,108 8.000% due 10/01/2007 52 53 5.500% due 10/15/2007 3,039 3,041 6.500% due 05/15/2008 1,000 1,017 2.800% due 06/15/2008 (d) 149 142 6.000% due 11/15/2008 225 227 6.200% due 12/15/2008 4,628 4,631 8.500% due 03/01/2009 131 137 6.000% due 03/15/2009 265 270 11.250% due 10/01/2009 3 3 7.000% due 06/01/2010 14 14 7.550% due 03/15/2012 180 186 11.875% due 06/15/2013 86 94 8.500% due 08/15/2013 2,000 2,064 8.500% due 09/15/2013 5,941 6,069 11.250% due 10/01/2014 67 76 6.000% due 11/15/2014 400 390 6.250% due 11/15/2015 851 852 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 111 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 10.100% due 09/01/2016 $ 237 $ 262 7.500% due 11/15/2016 28,791 29,682 6.250% due 10/15/2017 11,357 11,403 5.900% due 03/15/2018 1,652 1,651 6.350% due 03/25/2018 131 131 5.250% due 05/15/2018 4 4 6.400% due 02/15/2019 10,347 10,399 6.500% due 04/15/2019 1,566 1,578 6.500% due 05/15/2019 77 77 5.800% due 06/15/2019 2,092 2,090 6.250% due 07/15/2019 9,954 9,965 5.000% due 08/15/2019 55 55 10.000% due 11/15/2019 81 86 7.500% due 01/15/2020 1,444 1,448 5.638% due 06/15/2020 (d) 86 86 5.250% due 07/15/2020 216 215 5.750% due 08/15/2020 300 302 9.000% due 09/15/2020 50 52 5.000% due 10/15/2020 968 959 5.500% due 10/15/2020 38 38 9.500% due 11/15/2020 2,902 2,974 8.900% due 11/15/2020 9,925 10,247 9.000% due 12/15/2020 2,628 2,774 8.750% due 12/15/2020 1,254 1,315 6.000% due 12/15/2020 225 223 9.500% due 01/15/2021 1,789 1,893 6.250% due 01/15/2021 200 201 7.000% due 01/15/2021 3,735 3,761 8.000% due 04/15/2021 78 81 6.500% due 05/15/2021 92 93 6.500% due 05/17/2021 49 49 8.500% due 06/15/2021 17,153 17,956 6.000% due 06/15/2021 2,939 2,945 8.500% due 06/15/2021 5,137 5,413 6.950% due 07/15/2021 398 405 9.500% due 07/15/2021 1,014 1,035 8.000% due 07/15/2021 7,102 7,168 9.000% due 07/15/2021 1,868 1,981 6.950% due 08/15/2021 144 146 8.000% due 08/15/2021 23,472 23,945 6.200% due 08/15/2021 878 885 7.000% due 09/15/2021 112 115 6.500% due 09/15/2021 24,998 25,139 4.500% due 09/15/2021 264 255 7.000% due 10/15/2021 7 7 6.000% due 11/15/2021 1,058 1,059 8.000% due 12/15/2021 19,027 19,985 6.850% due 01/15/2022 700 714 8.250% due 06/15/2022 4,697 4,936 7.000% due 07/15/2022 9,699 9,711 8.500% due 10/15/2022 6,502 6,792 7.000% due 12/15/2022 21,000 21,499 7.500% due 01/15/2023 18,415 19,072 6.500% due 02/15/2023 1,250 1,281 7.500% due 05/01/2023 41 42 6.500% due 07/15/2023 240 245 7.000% due 07/15/2023 280 282 6.500% due 07/15/2023 32 32 7.500% due 07/15/2023 395 411 6.500% due 08/15/2023 125,035 126,064 6.850% due 10/25/2023 2,638 2,683 7.400% due 10/25/2023 (d) 13,188 13,646 6.500% due 11/15/2023 139 134 6.500% due 01/15/2024 35 35 7.500% due 01/20/2024 68 69 6.500% due 02/15/2024 20 20 5.000% due 02/15/2024 116 101 6.500% due 03/15/2024 331 322 8.000% due 04/25/2024 491 528 6.250% due 05/15/2024 13,780 13,119 8.500% due 08/01/2024 1,362 1,429 7.250% due 08/15/2024 190 193 8.000% due 09/15/2024 16,250 17,083 8.500% due 11/01/2024 558 586 6.750% due 01/17/2025 6,165 6,208 7.500% due 02/15/2025 3,044 3,092 6.000% due 02/15/2025 4,048 4,066 7.000% due 09/17/2025 40 41 7.000% due 03/01/2026 94 95 6.500% due 03/15/2026 110 108 6.000% due 08/15/2026 2,400 2,347 6.751% due 09/15/2026 (d) 49,153 49,002 8.348% due 10/01/2026 (d) 2,684 2,747 6.000% due 11/15/2026 550 545 7.000% due 01/01/2027 106 108 7.500% due 01/15/2027 26,198 27,277 8.000% due 02/15/2027 35,767 37,658 7.000% due 03/01/2027 133 135 7.500% due 03/17/2027 20,000 20,956 8.527% due 05/01/2027 (d) 508 521 6.750% due 05/15/2027 406 407 6.500% due 06/15/2027 10,499 10,013 7.500% due 06/20/2027 20,314 21,034 6.500% due 08/15/2027 16,157 15,316 6.500% due 09/15/2027 73,000 71,856 6.500% due 10/15/2027 32,300 31,887 6.000% due 11/15/2027 665 654 6.500% due 01/25/2028 8,691 8,511 7.000% due 02/15/2028 1,436 1,440 6.250% due 03/15/2028 10,000 9,555 6.500% due 04/15/2028 159,071 156,370 6.500% due 05/15/2028 51,566 50,355 6.500% due 06/15/2028 63,338 59,238 6.500% due 06/20/2028 24,032 22,687 7.000% due 07/01/2028 696 706 6.500% due 07/15/2028 72,353 66,330 6.500% due 08/15/2028 343,704 318,401 7.000% due 11/15/2028 9,000 9,089 6.000% due 12/01/2028 687 672 6.000% due 12/15/2028 11,442 10,057 6.250% due 12/15/2028 1,726 1,584 6.500% due 12/15/2028 7,289 6,698 6.000% due 12/15/2028 11,995 10,685 6.500% due 01/01/2029 1,461 1,461 6.000% due 01/15/2029 3,415 2,933 6.500% due 01/15/2029 10,411 10,291 6.000% due 02/15/2029 3,990 3,405 6.500% due 03/01/2029 611 611 6.500% due 03/15/2029 26,203 25,100 6.500% due 05/01/2029 894 893 6.500% due 06/01/2029 102 102 6.500% due 07/01/2029 1,045 1,043 8.000% due 07/15/2029 1,250 1,287 7.500% due 02/01/2030 1,129 1,156 7.500% due 07/15/2030 1,000 1,016 7.500% due 08/15/2030 519 528 5.664% due 09/15/2030 14,402 14,468 7.000% due 09/15/2030 (d) 18,634 18,613 7.000% due 10/15/2030 11,702 11,717 7.500% due 10/15/2030 28,215 28,290 5.614% due 11/15/2030 (d) 1,579 1,579 6.947% due 08/15/2032 (d) 32,027 32,821 Gaston Oaks PLC 6.930% due 01/01/2036 2,251 2,237 General Electric Capital Mortgage Services, Inc. 6.000% due 01/25/2009 519 519 7.250% due 07/25/2011 75 75 6.750% due 12/25/2012 2,088 2,106 6.500% due 09/25/2023 1,175 1,096 6.500% due 12/25/2023 8,631 8,020 6.500% due 01/25/2024 3,895 3,571 6.500% due 03/25/2024 67,513 66,553 6.500% due 04/25/2024 68,828 64,342 112 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 7.250% due 05/25/2026 $ 3,748 $ 3,810 7.500% due 06/25/2027 19,938 20,423 7.500% due 07/25/2027 10,066 10,331 7.000% due 10/25/2027 14,412 14,429 7.000% due 11/25/2027 72,500 73,736 6.650% due 05/25/2028 5,905 5,954 6.750% due 05/25/2028 23,934 23,988 6.750% due 06/25/2028 1,296 1,296 6.550% due 06/25/2028 23,450 23,905 6.750% due 06/25/2028 20,517 20,416 6.600% due 06/25/2028 5,936 5,987 6.750% due 10/25/2028 12,190 12,119 6.250% due 12/25/2028 54,624 52,461 6.500% due 12/25/2028 19,500 19,041 6.500% due 05/25/2029 9,858 9,566 6.750% due 05/25/2029 20,000 19,819 5.950% due 07/25/2029 24,794 24,788 6.500% due 07/25/2029 95,240 92,011 6.000% due 07/25/2029 23,507 23,577 6.250% due 07/25/2029 132,674 134,144 7.250% due 08/25/2029 8,000 8,106 7.000% due 09/25/2029 16,073 16,182 General Electric Credit Corp. 8.000% due 03/01/2002 (l) 3 3 German American Capital Corp. 4.306% due 07/01/2018 (d) 7,923 7,834 GGP - Homart 7.138% due 06/10/2003 (d) 19,459 19,482 GMAC Commercial Mortgage Asset Corp. 6.919% due 07/20/2002 3,256 3,256 GMAC Commercial Mortgage Securities, Inc. 6.566% due 11/15/2007 85 87 6.150% due 11/15/2007 254 258 6.700% due 03/15/2008 29,732 30,468 6.974% due 05/15/2008 27,444 28,614 6.945% due 09/15/2033 25,060 26,114 6.570% due 09/15/2033 46,597 47,911 GMAC Mortgage Corp. Loan Trust 7.500% due 05/25/2030 12,000 12,487 Goldman Sachs Mortgage Corp. 6.000% due 12/31/2007 (l) 8,171 8,165 Government National Mortgage Association 6.250% due 06/20/2022 33,961 34,212 7.219% due 06/20/2023 (d) 24,407 24,430 7.250% due 12/16/2023 6,294 6,405 8.000% due 05/16/2024 50 51 7.000% due 06/20/2025 12,138 12,259 7.000% due 03/20/2026 320 327 6.000% due 03/20/2026 1,500 1,500 6.070% due 06/16/2026 (d) 1,378 1,378 7.000% due 08/20/2026 104 106 7.500% due 07/16/2027 30,865 31,835 7.000% due 12/20/2027 18,960 19,026 8.000% due 04/16/2028 4,627 4,638 6.500% due 04/20/2028 11,887 10,962 6.750% due 06/20/2028 22,864 21,468 6.500% due 06/20/2028 31,364 28,982 7.250% due 07/16/2028 30 31 6.500% due 07/20/2028 40,416 36,141 6.500% due 09/20/2028 29,986 28,282 6.500% due 01/20/2029 28,770 26,605 7.000% due 02/16/2029 6,815 7,088 6.500% due 03/20/2029 16,259 15,673 8.000% due 03/20/2029 7,151 7,567 6.000% due 05/20/2029 11,104 9,798 7.000% due 01/16/2030 6,686 6,621 7.500% due 01/20/2030 327 338 5.750% due 02/16/2030 (d) 7,778 7,792 6.383% due 02/16/2030 (d) 12,065 12,126 5.800% due 02/16/2030 (d) 8,418 8,440 7.086% due 06/20/2030 (d) 4,565 4,573 7.119% due 09/20/2030 (d) 11,835 11,804 7.500% due 09/20/2030 5,158 5,273 7.100% due 10/16/2030 (d) 70,053 70,272 Greenwich Capital Acceptance, Inc. 8.305% due 04/25/2022 (d) 314 313 8.325% due 10/25/2022 (d) 34 34 8.441% due 04/25/2023 (d) 676 674 8.935% due 04/25/2024 (d) 459 473 9.716% due 08/25/2024 (d) 356 360 9.687% due 11/25/2024 (d) 33 33 Guardian Savings & Loan Association 7.557% due 09/25/2018 (d) 75 76 Headlands Mortgage Securities, Inc. 7.250% due 11/25/2012 2,089 2,114 7.155% due 12/25/2012 686 697 7.250% due 11/25/2027 18,456 18,759 7.000% due 02/25/2028 410 411 Home Savings of America 8.464% due 08/01/2006 42 43 6.480% due 05/25/2027 (d) 2,455 2,434 6.563% due 08/20/2029 (d) 21,461 21,476 Housing Securities, Inc. 7.000% due 05/25/2008 833 849 HSBC Mortgage Loan Trust 7.110% due 11/16/2030 19,396 19,436 HVMLT 7.470% due 08/19/2030 22,975 23,996 ICI Funding Corp. Secured Assets Corp. 7.250% due 09/25/2027 18,068 18,445 7.750% due 03/25/2028 1,855 1,885 Impac Secured Assets CMN Owner Trust 6.850% due 07/25/2028 58 58 7.318% due 10/25/2030 (d) 54,327 54,639 Imperial CMB Trust 6.650% due 11/25/2029 949 969 Imperial Savings Association 8.230% due 01/25/2017 (d) 54 54 8.839% due 06/25/2017 (d) 206 206 Independent National Mortgage Corp. 8.250% due 05/25/2010 128 131 6.650% due 10/25/2024 2,723 2,738 8.634% due 11/25/2024 (d) 462 465 8.750% due 12/25/2024 30 31 9.232% due 01/25/2025 (d) 75 76 8.000% due 06/25/2025 0 0 8.225% due 07/25/2025 (d) 5,475 5,515 7.500% due 09/25/2025 471 472 6.930% due 05/25/2026 412 412 International Mortgage Acceptance Corp. 12.250% due 03/01/2014 247 286 J.P. Morgan Commercial Mortgage Finance Corp. 8.227% due 02/25/2028 1,615 1,677 7.069% due 09/15/2029 65 68 6.533% due 01/15/2030 20,000 20,510 Kidder Peabody Acceptance Corp. 8.937% due 09/25/2024 (d) 4,245 4,297 LB Commercial Conduit Mortgage Trust 6.330% due 11/18/2004 39 40 LB Mortgage Trust 8.396% due 01/20/2017 (d) 39,862 43,912 Lehman Large Loan 6.790% due 06/12/2004 55 57 LTC Commercial Corp. 7.100% due 11/28/2012 3,140 3,222 Mellon Residential Funding Corp. 6.500% due 02/25/2028 10,000 9,656 6.350% due 06/25/2028 22,000 22,185 5.652% due 06/26/2028 7,426 7,409 6.110% due 01/25/2029 23,900 23,970 6.570% due 07/25/2029 (d) 44,000 44,874 6.580% due 07/25/2029 (d) 55,565 56,238 6.460% due 07/25/2029 (d) 4,622 4,634 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 113 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Merrill Lynch Mortgage Investors, Inc. 6.861% due 06/15/2021 $ 1,982 $ 2,020 6.978% due 06/15/2021 (d) 4,370 4,476 7.238% due 06/15/2021 (d) 4,099 4,194 7.598% due 06/15/2021 (d) 910 921 6.950% due 06/18/2029 34,041 35,062 5.650% due 12/15/2030 7,590 7,612 Midland Realty Acceptance Corp. 7.020% due 01/25/2029 12,112 12,400 MLCC Mortgage Investors, Inc. 6.875% due 09/15/2026 (d) 17,183 17,201 Morgan Stanley Capital I 6.440% due 11/15/2002 18 18 5.990% due 03/15/2005 54 55 6.860% due 05/15/2006 (d) 1,910 1,971 6.190% due 01/15/2007 19,529 19,879 6.160% due 04/03/2009 12,840 13,018 7.460% due 02/15/2020 10,542 11,073 6.850% due 07/25/2027 (d) 417 415 6.220% due 06/01/2030 68 69 6.590% due 10/03/2030 6,485 6,674 Mortgage Capital Funding, Inc. 7.800% due 04/15/2006 500 540 7.008% due 09/20/2006 15,545 16,161 7.600% due 05/25/2027 3,894 3,943 6.001% due 11/18/2031 69 70 NationsBanc Montgomery Funding Corp. 6.750% due 06/25/2028 10,000 9,926 6.500% due 07/25/2028 14,470 14,255 6.750% due 08/25/2028 20,009 19,535 6.250% due 10/25/2028 7,000 6,659 Nationslink Funding Corp. 6.654% due 02/10/2006 19,624 20,248 5.921% due 04/10/2007 (d) 20,192 20,195 5.805% due 11/10/2030 7,174 7,175 Nomura Asset Securities Corp. 6.625% due 01/25/2009 19 19 8.105% due 05/25/2024 (d) 1,050 1,076 Norwest Asset Securities Corp. 6.750% due 12/25/2012 15,113 15,485 6.500% due 04/25/2013 19,557 19,750 6.500% due 06/25/2013 12,972 13,099 7.500% due 03/25/2027 41,558 42,684 6.750% due 09/25/2027 2,612 2,637 6.350% due 04/25/2028 1,084 1,085 6.750% due 05/25/2028 40,707 40,414 6.750% due 07/25/2028 12,657 12,578 6.250% due 08/25/2028 3,245 3,256 6.250% due 09/25/2028 400 383 6.200% due 09/25/2028 744 744 6.750% due 10/25/2028 38,104 37,906 6.500% due 12/25/2028 39,751 39,015 6.500% due 01/25/2029 385 346 6.500% due 02/25/2029 67,432 65,324 6.200% due 04/25/2029 77,385 77,159 6.500% due 04/25/2029 26,751 25,925 6.300% due 04/25/2029 6,847 6,855 5.950% due 04/25/2029 97,464 97,367 6.000% due 05/25/2029 19,713 19,772 6.250% due 05/25/2029 472 476 6.500% due 06/25/2029 46,178 44,631 6.750% due 08/25/2029 1,103 1,112 6.500% due 10/25/2029 1,969 1,905 7.000% due 11/25/2029 14,793 14,946 7.250% due 02/25/2030 19,756 20,095 Norwest Integrated Structured Assets, Inc. 7.000% due 09/25/2029 3,574 3,536 Paine Webber Mortgage Acceptance Corp. 6.000% due 04/25/2009 11,951 11,852 PHH Mortgage Services Corp. 7.184% due 11/18/2027 948 951 PNC Mortgage Securities Corp. 6.750% due 06/25/2016 8,897 8,960 7.000% due 10/25/2027 35,815 36,299 6.750% due 12/25/2027 7,230 6,929 6.990% due 02/25/2028 9,494 9,776 6.500% due 02/25/2028 850 849 7.000% due 02/25/2028 25,470 25,805 6.625% due 03/25/2028 1,561 1,572 7.000% due 05/25/2028 5,664 5,753 6.750% due 07/25/2028 3,527 3,509 6.550% due 07/25/2028 24,500 24,707 6.750% due 09/25/2028 3,996 3,974 6.750% due 10/25/2028 26,045 25,987 6.750% due 12/25/2028 21,709 21,443 6.500% due 01/25/2029 999 975 6.250% due 01/25/2029 9,263 8,991 6.300% due 03/25/2029 9,989 9,505 6.200% due 06/25/2029 46,288 46,757 6.500% due 06/25/2029 48,600 46,862 7.750% due 07/25/2030 67,726 69,530 6.013% due 12/25/2030 (d) 35,452 35,519 7.500% due 02/25/2031 88,982 92,271 7.500% due 05/25/2040 (d) 444 451 PNC Mortgage Trust 8.250% due 03/25/2030 58,189 59,980 Prudential Home Mortgage Securities 7.400% due 11/25/2007 1,416 1,443 7.000% due 01/25/2008 23,860 24,270 6.750% due 07/25/2008 1,256 1,268 6.400% due 04/25/2009 330 329 6.950% due 11/25/2022 222 219 7.000% due 07/25/2023 10,270 10,431 6.750% due 10/25/2023 9,940 9,261 5.900% due 12/25/2023 3,376 3,382 6.500% due 01/25/2024 617 619 6.050% due 04/25/2024 1,959 1,957 6.800% due 05/25/2024 11,349 10,985 6.450% due 11/25/2025 5,264 4,959 Prudential Securities Secured Financing Corp. 6.074% due 01/15/2008 11,965 12,107 Prudential-Bache Trust 6.676% due 09/01/2018 (d) 195 196 8.400% due 03/20/2021 5,367 5,614 PSB Financial Corp. II 11.050% due 12/01/2015 405 429 Resecuritization Mortgage Trust 6.750% due 06/19/2028 18,121 18,155 6.500% due 04/19/2029 3,764 3,824 Residential Accredit Loans, Inc. 7.500% due 08/25/2027 15,000 15,394 6.500% due 02/25/2028 11,531 11,518 7.000% due 02/25/2028 41,115 41,869 6.500% due 12/25/2028 400 391 6.500% due 05/25/2029 3,000 2,925 6.750% due 06/25/2029 1,464 1,478 7.000% due 07/25/2029 418 422 7.750% due 03/25/2030 3,389 3,431 Residential Asset Securitization Trust 7.375% due 03/25/2027 5,142 5,267 7.000% due 10/25/2027 19,360 19,763 7.000% due 01/25/2028 20,000 20,225 6.750% due 06/25/2028 13,193 13,307 6.500% due 12/25/2028 1,250 1,237 6.500% due 03/25/2029 22,700 22,629 8.000% due 02/25/2030 43,760 45,111 7.320% due 09/25/2030 (d) 15,052 15,159 Residential Funding Mortgage Securities I 7.000% due 08/25/2008 3,902 3,922 7.500% due 09/25/2011 12,122 12,355 7.000% due 05/25/2012 3,095 3,197 6.500% due 12/25/2012 20,123 20,124 7.750% due 09/25/2022 391 393 8.000% due 01/25/2023 2,615 2,655 114 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Value Amount (000s) (000s) -------------------------------------------------------------------------------- 8.000% due 02/25/2023 $ 9,225 $ 9,403 6.500% due 11/25/2023 1,660 1,601 6.000% due 03/25/2024 392 391 7.500% due 09/25/2025 9,892 9,973 7.500% due 12/25/2025 937 971 7.750% due 11/25/2026 9,000 9,366 7.500% due 04/25/2027 6,085 6,229 7.500% due 06/25/2027 53,035 54,222 7.500% due 07/25/2027 25,265 26,042 7.250% due 08/25/2027 16,000 16,134 7.250% due 10/25/2027 39,303 39,700 7.000% due 11/25/2027 17,000 17,262 6.750% due 02/25/2028 32,196 32,342 6.750% due 05/25/2028 60,741 60,780 6.750% due 06/25/2028 67,908 66,989 6.750% due 07/25/2028 13,292 13,228 6.750% due 08/25/2028 35,000 34,836 6.750% due 09/25/2028 66,493 66,027 6.500% due 10/25/2028 52,000 50,794 6.250% due 11/25/2028 3,000 2,878 6.500% due 12/25/2028 23,400 22,784 6.500% due 01/25/2029 72,314 70,451 6.500% due 03/25/2029 27,960 27,184 6.200% due 05/25/2029 46,610 46,622 6.500% due 06/25/2029 11,708 10,347 6.750% due 07/25/2029 22,600 22,573 7.000% due 10/25/2029 25,260 25,415 7.500% due 02/25/2030 12,338 12,704 7.750% due 10/25/2030 26,572 27,237 7.500% due 11/25/2030 183,575 187,754 Resolution Trust Corp. 8.686% due 08/25/2021 6,075 6,057 11.062% due 10/25/2021 46 48 8.625% due 10/25/2021 115 114 8.138% due 10/25/2021 (d) 123 122 5.567% due 10/25/2021 (d) 127 127 8.720% due 05/25/2022 (d) 1,211 1,207 8.640% due 08/25/2023 (d) 1,733 1,754 8.835% due 12/25/2023 3,300 3,368 8.000% due 04/25/2025 156 155 8.000% due 06/25/2026 249 246 8.427% due 10/25/2028 (d) 4,388 4,466 7.596% due 10/25/2028 (d) 12,343 12,404 7.510% due 05/25/2029 (d) 2,266 2,322 7.245% due 05/25/2029 (d) 2,486 2,504 6.923% due 05/25/2029 (d) 2,865 2,867 RMF Commercial Mortgage Securities, Inc. 6.715% due 01/15/2019 (d) 235 241 Ryan Mortgage Acceptance Corp. IV 9.450% due 10/01/2016 73 78 Ryland Acceptance Corp. 11.500% due 12/25/2016 80 86 8.200% due 09/25/2022 11 11 Ryland Mortgage Securities Corp. 8.200% due 06/25/2021 34 34 8.518% due 08/25/2022 (d) 1,587 1,602 8.108% due 08/25/2029 (d) 1,762 1,769 7.402% due 10/25/2031 (d) 2,085 2,102 14.000% due 11/25/2031 684 731 SACO I, Inc. 7.460% due 07/25/2030 506 506 8.128% due 07/25/2030 15,241 15,769 6.140% due 09/25/2040 (d) 546 546 Salomon Brothers Mortgage Securities VII 8.613% due 09/25/2022 (d) 746 752 8.565% due 11/25/2022 (d) 382 387 8.950% due 03/25/2024 (d) 287 293 9.240% due 07/01/2024 (d) 3,732 3,790 9.307% due 09/25/2024 (d) 266 272 6.960% due 04/25/2029 (d) 14,057 14,094 5.430% due 04/25/2029 (d) 5,444 5,463 6.918% due 06/25/2029 (d) 34,211 34,195 7.600% due 08/25/2030 125,500 128,143 Santa Barbara Savings & Loan Association 9.500% due 11/20/2018 1,792 1,847 Sasco Floating Rate Commercial Mortgage Trust 5.408% due 11/20/2001 (d) 36,906 36,938 Saxon Mortgage Securities Corp. 6.250% due 04/25/2009 2,032 2,039 7.375% due 09/25/2023 6,372 6,498 6.500% due 02/25/2024 1,517 1,525 9.154% due 09/25/2024 (d) 1,267 1,278 Sears Mortgage Securities 12.000% due 02/25/2014 534 556 7.896% due 11/25/2021 (d) 449 455 7.431% due 10/25/2022 (d) 1,538 1,555 6.278% due 12/25/2028 254 253 Securitized Asset Sales, Inc. 8.543% due 12/26/2023 (d) 620 647 7.410% due 09/25/2024 (d) 9,900 10,078 Security Pacific National Bank 6.378% due 03/25/2018 (d) 81 81 7.156% due 09/25/2019 (d) 462 463 Sequoia Mortgage Trust 6.350% due 09/25/2025 (d) 5,343 5,396 Small Business Investment Cos. 7.540% due 08/10/2009 93,532 99,276 8.017% due 02/10/2010 115,208 125,258 7.640% due 03/10/2010 69,504 73,960 7.452% due 09/01/2010 15,860 16,698 Starwood Commercial Mortgage Trust 6.600% due 02/03/2009 11,041 11,389 Structured Asset Mortgage Investments, Inc. 6.750% due 03/25/2028 22,356 22,065 6.902% due 06/25/2028 (d) 35,851 37,373 6.250% due 11/25/2028 14,878 14,219 6.750% due 01/25/2029 10,000 9,916 6.300% due 05/25/2029 21,870 21,958 6.581% due 06/25/2029 (d) 29,054 29,515 7.250% due 07/25/2029 19,588 19,812 7.226% due 02/25/2030 (d) 908 931 6.750% due 05/02/2030 25,000 24,035 Structured Asset Notes Transactions Ltd. 6.650% due 08/30/2005 (d) 16,364 16,241 Structured Asset Securities Corp. 7.000% due 02/25/2016 30,002 30,587 7.000% due 12/25/2027 51,500 52,079 7.220% due 11/25/2030 (d) 38,908 38,774 Superannuation Members Home Loans Global Fund 6.835% due 06/15/2026 (d) 19,900 19,900 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 30,145 30,145 Torrens Trust 5.424% due 07/15/2031 (d) 3,593 3,593 Union Planters Mortgage Finance Corp. 6.750% due 01/25/2028 4,000 3,969 6.800% due 01/25/2028 15,000 15,226 United Mortgage Securities Corp. 7.302% due 06/25/2032 18,991 19,194 7.108% due 09/25/2033 (d) 393 406 Vendee Mortgage Trust 7.500% due 08/15/2017 229 232 7.750% due 05/15/2018 550 561 6.500% due 05/15/2020 29,697 29,460 7.750% due 05/15/2022 303 319 6.835% due 01/15/2030 15,952 16,345 Washington Mutual, Inc. 5.690% due 07/26/2003 (d) 109,938 109,905 7.500% due 11/19/2029 600 618 7.608% due 12/25/2040 37,551 37,657 7.175% due 01/25/2041 112,469 115,949 Wells Fargo Mortgage Backed Securities Trust 7.500% due 01/25/2031 5,094 5,049 Western Federal Savings & Loan Association 7.997% due 06/25/2021 (d) 2,561 2,565 ----------- 10,689,693 ----------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 115 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Fannie Mae 7.1% 5.500% due 01/01/2004-01/01/2031 (k) $ 20,723 $ 19,717 6.000% due 11/01/2003-04/16/2031 (k) 1,013,468 988,527 6.090% due 12/01/2008 49 49 6.210% due 08/01/2010-04/01/2027 (d)(k) 50,969 51,573 6.255% due 09/01/2013 64,000 64,168 6.258% due 09/01/2029 (d) 587 595 6.420% due 12/01/2007 150 155 6.500% due 04/01/2003-03/01/2031 (k) 20,264 20,362 6.550% due 01/01/2008 950 986 6.570% due 04/01/2026 (d) 1,093 1,128 6.626% due 12/01/2027 (d) 7,508 7,775 6.688% due 08/01/2027 (d) 35,083 35,996 6.726% due 05/01/2030 (d) 253 255 6.730% due 11/01/2007 1,138 1,191 6.739% due 09/01/2017 (d) 5,229 5,224 6.750% due 08/01/2003 164 165 6.840% due 09/01/2024 (d) 1,869 1,900 6.847% due 07/01/2003 61 62 6.961% due 01/01/2018 (d) 1,046 1,068 6.969% due 10/01/2027 (d) 4,022 4,154 6.981% due 06/01/2007 462 486 7.000% due 07/01/2001-05/15/2031 (k) 1,369,639 1,384,885 7.250% due 05/01/2002-01/01/2023 (k) 9,520 9,595 7.350% due 09/01/2027 (d) 1,555 1,618 7.364% due 02/01/2028 (d) 1,139 1,180 7.468% due 06/01/2030 (d) 41,866 44,208 7.500% due 10/01/2002-10/01/2030 (k) 19,040 19,685 7.508% due 10/01/2030-10/01/2040 (d)(k) 31,856 32,791 7.552% due 05/01/2023 (d) 2,062 2,127 7.750% due 06/01/2009 149 154 7.780% due 01/01/2018 2,230 2,518 7.850% due 07/01/2018 6,699 7,425 7.920% due 03/01/2018 2,745 3,137 7.980% due 05/01/2030 6,678 6,990 8.000% due 09/01/2001-04/16/2031 (k) 188,605 194,508 8.039% due 05/01/2025 (d) 2,273 2,334 8.060% due 04/01/2030 1,854 1,947 8.079% due 09/01/2022 (d) 911 936 8.080% due 04/01/2030 1,015 1,066 8.095% due 06/01/2023 (d) 1,851 1,907 8.097% due 12/01/2023 (d) 678 695 8.108% due 10/01/2024 (d) 263 269 8.189% due 09/01/2024 (d) 1,211 1,231 8.211% due 12/01/2023 (d) 769 782 8.230% due 11/01/2025 (d) 1,140 1,170 8.235% due 03/01/2025-11/01/2025 (d)(k) 4,395 4,518 8.250% due 10/01/2008-03/01/2030 (k) 2,194 2,431 8.276% due 08/01/2027 (d) 939 970 8.291% due 01/01/2024-07/01/2024 (d)(k) 4,347 4,453 8.315% due 01/01/2024 (d) 358 369 8.318% due 02/01/2026 (d) 466 483 8.344% due 11/01/2023 (d) 758 779 8.347% due 09/01/2025 (d) 1,184 1,216 8.348% due 11/01/2025 (d) 3,033 3,114 8.362% due 01/01/2024 (d) 1,604 1,654 8.364% due 10/01/2024 (d) 1,343 1,389 8.374% due 03/01/2026 (d) 1,629 1,695 8.380% due 09/01/2022 (d) 948 972 8.389% due 08/01/2026 (d) 1,630 1,684 8.396% due 01/01/2026 (d) 1,044 1,078 8.405% due 12/01/2023 (d) 163 168 8.410% due 09/01/2023 (d) 2,195 2,238 8.418% due 06/01/2024 (d) 1,219 1,247 8.446% due 10/01/2023 (d) 304 314 8.450% due 11/01/2023 (d) 164 170 8.451% due 05/01/2026 (d) 501 514 8.472% due 01/01/2024 (d) 111 115 8.490% due 06/01/2025 992 1,047 8.494% due 12/01/2023 (d) 1,017 1,051 8.500% due 07/01/2001-09/01/2030 (k) 6,923 7,241 8.574% due 05/01/2024 (d) 1,970 2,012 8.903% due 08/01/2023 (d) 518 539 9.000% due 10/01/2004-12/01/2027 (k) 8,542 9,056 9.250% due 10/01/2001 1 1 9.500% due 12/01/2006-07/01/2026 (k) 8,569 9,017 9.750% due 11/01/2008 49 53 10.000% due 09/01/2003-05/01/2022 (k) 1,106 1,208 10.500% due 01/01/2016-04/01/2022 (k) 480 532 10.750% due 03/01/2014 24 26 11.000% due 09/01/2019-11/01/2020 (k) 113 127 11.500% due 08/20/2016-11/01/2019 (k) 72 81 12.000% due 05/01/2016 8 10 12.500% due 10/01/2015 27 31 13.000% due 09/01/2013 27 32 13.250% due 09/01/2011 11 13 14.500% due 11/01/2011-01/01/2013 (k) 36 42 14.750% due 08/01/2012 146 175 15.000% due 10/01/2012 77 93 15.500% due 10/01/2012-12/01/2012 (k) 16 18 15.750% due 12/01/2011-08/01/2012 (k) 86 103 16.000% due 09/01/2012 99 117 ---------- 2,992,890 ---------- Federal Housing Administration 1.2% 6.000% due 03/20/2028 4,598 4,490 6.500% due 05/28/2039 5 5 6.750% due 07/15/2001 1,444 1,451 6.755% due 03/01/2041 16,213 16,129 6.780% due 07/25/2040 7,658 7,553 6.790% due 05/01/2039 10,902 10,123 6.830% due 12/01/2039 3,497 3,460 6.875% due 11/01/2015 3,153 3,057 6.880% due 10/25/2040-02/01/2041 (k) 21,722 21,571 6.896% due 07/01/2020 22,087 21,254 6.900% due 12/01/2040 22,769 22,643 6.930% due 07/01/2014-01/01/2036 (k) 20,005 19,892 7.000% due 11/15/2040 63 65 7.050% due 03/25/2040 4,517 4,541 7.125% due 03/01/2034 4,401 4,265 7.150% due 01/25/2029 9,573 9,295 7.211% due 12/01/2021 2,695 2,649 7.250% due 06/01/2040 8,304 8,437 7.310% due 06/01/2041 23,566 24,048 7.315% due 08/01/2019 32,306 32,024 7.317% due 05/01/2019 4,725 4,621 7.350% due 11/01/2020-11/01/2022 (k) 9,945 9,882 7.375% due 02/01/2018-01/01/2024 (k) 16,436 16,332 7.400% due 01/25/2020-02/01/2021 (k) 12,034 11,995 7.430% due 12/01/2016-05/01/2025 (k) 135,778 135,600 7.450% due 12/01/2021-10/01/2023 (k) 15,942 15,905 7.460% due 01/01/2023 2,137 2,136 7.465% due 11/01/2019 29,537 29,528 7.500% due 03/01/2032-09/30/2039 (k) 4,890 4,981 7.580% due 12/01/2040 7,616 7,834 7.630% due 08/01/2041 20,577 21,178 7.650% due 11/01/2018-11/01/2040 (k) 7,559 7,869 7.700% due 03/15/2041 350 370 7.750% due 11/15/2039 978 1,037 7.880% due 12/01/2039-03/01/2041 (k) 13,423 14,078 7.930% due 05/01/2016 1,877 1,909 8.250% due 10/29/2023-01/01/2041 (k) 9,484 9,999 8.378% due 11/07/2012 244 253 ---------- 512,459 ---------- Freddie Mac 1.6% 5.500% due 04/01/2001-04/16/2031 (k) 3,845 3,727 6.000% due 01/01/2011-05/14/2031 (k) 20,510 20,518 6.263% due 12/01/2026 (d) 5,522 5,552 6.500% due 07/01/2001-05/01/2029 (k) 8,801 8,950 6.553% due 11/01/2026 (d) 6,055 6,146 6.732% due 11/01/2028 (d) 20,764 21,238 6.775% due 11/01/2003 63 62 6.903% due 07/01/2025 (d) 5,803 5,959 7.000% due 10/01/2002-05/14/2031 (k) 390,901 395,710 7.250% due 11/01/2008 175 178 7.285% due 09/01/2027 (d) 2,449 2,534 7.500% due 09/01/2001-03/01/2030 (k) 14,822 15,147 116 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 7.625% due 06/01/2017 (d) $ 17 $ 17 7.645% due 05/01/2025 2,374 2,537 7.750% due 04/01/2017 (d) 29 29 7.812% due 07/01/2030 (d) 127,169 133,327 8.000% due 01/01/2002-09/01/2018 (k) 3,511 3,631 8.142% due 04/01/2024 (d) 5,790 5,944 8.250% due 12/01/2002-01/01/2019 (d)(k) 218 224 8.252% due 07/01/2022 (d) 587 598 8.276% due 08/01/2023 (d) 7 7 8.346% due 06/01/2022 (d) 1,006 1,023 8.362% due 06/01/2024 (d) 2,520 2,590 8.364% due 07/01/2023 (d) 452 459 8.365% due 11/01/2023 (d) 96 99 8.368% due 10/01/2023 (d) 729 748 8.375% due 06/01/2024 (d) 1,473 1,509 8.376% due 10/01/2023 (d) 1,339 1,373 8.380% due 09/01/2023 (d) 7,900 8,045 8.390% due 08/01/2023 (d) 7,857 8,084 8.396% due 09/01/2023 (d) 1,142 1,171 8.423% due 04/01/2029 (d) 1,094 1,128 8.424% due 05/01/2023 (d) 650 662 8.434% due 07/01/2023 (d) 1,461 1,475 8.435% due 05/01/2023-08/01/2023 (d)(k) 5,320 5,419 8.445% due 08/01/2023 (d) 835 848 8.451% due 01/01/2024 (d) 398 410 8.458% due 07/01/2024 (d) 1,257 1,291 8.500% due 09/01/2001-06/01/2030 (k) 3,567 3,728 8.545% due 08/01/2024 (d) 167 172 8.567% due 05/01/2023 (d) 1,582 1,621 8.575% due 01/01/2024 (d) 348 360 8.584% due 09/01/2023 (d) 2,072 2,113 8.626% due 08/01/2023 (d) 315 318 8.651% due 09/01/2023 (d) 1,032 1,036 8.665% due 12/01/2023 (d) 1,068 1,105 8.667% due 10/01/2023 (d) 1,298 1,334 8.670% due 04/01/2023 (d) 321 329 8.750% due 01/01/2007-12/01/2010 (k) 57 60 8.834% due 11/01/2023 (d) 345 346 8.937% due 10/01/2023 (d) 267 269 8.980% due 11/01/2023 (d) 142 141 9.000% due 01/01/2002-05/01/2017 (k) 407 424 9.006% due 10/01/2023 (d) 954 962 9.111% due 11/01/2023 (d) 258 260 9.250% due 06/01/2009-11/01/2013 (k) 70 73 9.500% due 08/01/2001-12/01/2022 (k) 1,286 1,352 9.750% due 11/01/2004-05/01/2009 (k) 35 36 10.000% due 06/01/2004-03/01/2021 (k) 762 810 10.250% due 04/01/2009-05/01/2009 (k) 991 1,086 10.500% due 10/01/2017-01/01/2021 (k) 345 385 10.750% due 09/01/2010 34 38 11.000% due 11/01/2009-05/01/2020 (k) 570 634 11.250% due 10/01/2009-09/01/2015 (k) 20 22 11.500% due 01/01/2018 63 70 12.500% due 12/01/2012 15 17 13.250% due 10/01/2013 79 93 14.000% due 04/01/2016 15 18 15.500% due 08/01/2011-11/01/2011 (k) 12 15 16.250% due 05/01/2011 3 3 ---------- 687,599 ---------- Government National Mortgage Association 41.7% 5.000% due 06/20/2022-06/20/2026 (d)(k) 974 989 5.500% due 06/20/2026-04/23/2031 (d)(k) 21,909 20,932 5.650% due 10/15/2012 11 10 6.000% due 10/15/2008-04/23/2031 (d)(k) 2,727,913 2,684,181 6.375% due 05/20/2026-05/20/2027 (d)(k) 3,457 3,507 6.500% due 10/15/2008-09/15/2040 (d)(k) 8,375,660 8,373,036 6.625% due 01/15/2040 9,588 9,720 6.670% due 10/15/2001-07/16/2038 (k) 961 958 6.750% due 07/15/2001-07/20/2024 (d)(k) 18,347 18,466 6.800% due 05/15/2040 2,988 2,963 6.820% due 04/15/2040 16,932 16,804 6.875% due 02/20/2016-02/15/2040 (d)(k) 1,171 1,200 7.000% due 10/15/2001-01/03/2041 (d)(k) 5,059,234 5,134,389 7.125% due 10/20/2019-11/20/2027 (d)(k) 35,952 36,851 7.250% due 08/20/2024 (d) 281 286 7.375% due 05/20/2017-05/20/2028 (d)(k) 514,296 522,113 7.500% due 01/15/2003-01/15/2031 (k) 127,981 131,280 7.625% due 12/20/2017-12/20/2027 (d)(k) 306,342 314,014 7.700% due 02/15/2002 6,403 6,764 7.750% due 07/15/2001-09/20/2027 (d)(k) 359,978 368,770 7.875% due 04/20/2023 (d) 270 275 8.000% due 08/15/2005-09/15/2030 (k) 12,494 12,930 8.125% due 07/15/2001-12/01/2039 (k) 3,680 3,994 8.250% due 08/15/2004-08/20/2027 (d)(k) 1,178 1,227 8.500% due 06/15/2001-04/23/2031 (k) 8,672 8,985 8.750% due 03/15/2007-07/15/2007 (k) 87 92 9.000% due 06/15/2001-07/20/2022 (k) 5,286 5,640 9.250% due 07/15/2003-12/20/2016 (k) 137 144 9.500% due 12/15/2003-08/15/2023 (k) 4,093 4,424 9.750% due 09/15/2002-07/15/2004 (k) 67 70 10.000% due 08/20/2004-02/15/2025 (k) 4,771 5,261 10.250% due 02/20/2019 22 24 10.500% due 06/15/2004-09/15/2021 (k) 614 668 11.000% due 05/15/2004-03/15/2019 (k) 181 199 11.250% due 12/20/2015 33 36 11.500% due 10/15/2010-10/15/2015 (k) 85 94 12.000% due 11/15/2012-05/15/2016 (k) 205 238 12.500% due 01/15/2011 1 1 13.000% due 12/15/2012-10/15/2014 (k) 16 20 13.250% due 10/20/2014 19 22 13.500% due 10/15/2012-09/15/2014 (k) 72 84 15.000% due 02/15/2012-10/15/2012 (k) 92 110 16.000% due 10/15/2011-05/15/2012 (k) 191 231 17.000% due 11/15/2011-12/15/2011 (k) 58 68 ---------- 17,692,070 ---------- Stripped Mortgage-Backed Securities 0.0% Bear Stearns Mortgage Securities, Inc. (IO) 7.200% due 07/25/2024 257 14 Chase Mortgage Finance Corp. (IO) 9.000% due 08/25/2023 142 2 Collateralized Mortgage Obligation Trust (PO) 0.000% due 04/23/2017 11 9 Fannie Mae (IO) 6.500% due 05/25/2005 574 48 6.500% due 07/25/2006 248 6 727.220% due 09/25/2006 2 6 6.500% due 02/25/2007 771 30 6.500% due 07/25/2007 137 4 6.500% due 09/25/2007 1,025 45 6.500% due 10/25/2007 281 12 0.100% due 03/25/2009 (d) 20,167 319 6.500% due 08/25/2020 2,064 114 1007.000% due 01/25/2021 0 1 7.500% due 04/25/2021 1,308 153 903.213% due 08/25/2021 5 114 0.950% due 11/25/2021 (d) 19,264 270 6.500% due 10/25/2022 90 8 6.500% due 01/25/2023 2,441 355 3.663% due 02/25/2023 (d) 10,735 715 Fannie Mae (PO) 0.000% due 09/01/2007 588 527 0.000% due 06/25/2022 110 109 0.000% due 08/25/2023 295 241 Freddie Mac (IO) 5.750% due 09/15/2007 (d) 4,517 334 6.000% due 10/15/2007 138 8 6.000% due 01/15/2008 49 2 5.428% due 02/15/2008 (d) 466 31 7.000% due 08/15/2008 2,633 263 6.400% due 10/15/2008 42 5 7.000% due 04/15/2018 414 7 6.500% due 10/15/2018 266 8 8.845% due 01/15/2021 2 23 9.000% due 05/15/2022 85 15 6.500% due 09/15/2023 231 26 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 117 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Paine Webber CMO Trust (IO) 1359.500% due 08/01/2019 $ 1 $ 27 Vendee Mortgage Trust (IO) 0.542% due 06/15/2023 (d) 141,532 2,541 ------------ 6,392 ------------ Total Mortgage-Backed Securities 32,581,103 (Cost $32,294,094) ------------ -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 6.7% -------------------------------------------------------------------------------- Aames Mortgage Trust 5.524% due 06/15/2027 437 436 7.119% due 11/25/2030 (d) 43,424 43,537 ABFS Equipment Contract Trust 6.100% due 10/15/2005 54 53 ABSC Long Beach Home Equity Loan Trust 6.436% due 07/21/2030 (d) 375 377 6.096% due 08/21/2030 (d) 127,449 127,589 Accredited Mortgage Loan Trust 5.850% due 02/25/2030 (d) 45,106 45,206 Ace Securities Corp. 6.940% due 11/25/2028 (d) 1,230 1,233 Advanta Mortgage Loan Trust 5.263% due 05/25/2027 (d) 667 664 6.114% due 08/25/2029 (d) 2,307 2,316 5.425% due 11/25/2029 (d) 1,586 1,588 8.250% due 08/25/2030 7,954 8,371 Advanta Revolving Home Equity Loan Trust 6.988% due 01/25/2024 (d) 22,049 22,123 6.868% due 08/25/2024 (d) 20,049 20,047 6.898% due 02/25/2025 (d) 12,535 12,544 Aerco Ltd. 7.089% due 07/15/2025 (d) 38,200 38,258 AESOP Funding II LLC 5.830% due 11/20/2006 (d) 15,500 15,418 AFC Home Equity Loan Trust 7.808% due 10/25/2026 (d) 3 3 American Express Credit Account Master Trust 6.800% due 12/15/2003 1,500 1,505 American Express Master Trust 7.850% due 08/15/2005 220 237 American Stores Co. 6.899% due 08/30/2004 20,000 19,776 Americredit Automobile Receivable Trust 5.304% due 10/12/2002 1,913 1,915 5.780% due 05/12/2003 43,000 43,222 5.443% due 09/05/2006 (d) 5,000 5,017 Ameriquest Mortgage Securities, Inc. 5.889% due 06/15/2030 12,168 12,196 Amresco Residential Securities Mortgage Loan Trust 6.775% due 05/25/2028 (d) 1,661 1,662 Arcadia Automobile Receivables Trust 6.250% due 09/15/2002 4,773 4,781 6.300% due 07/15/2003 25,821 25,982 6.900% due 12/15/2003 20,519 20,838 Associates Manufactured Housing 7.000% due 03/15/2027 1,492 1,499 Banc One Heloc Trust 6.880% due 04/20/2020 (d) 38,373 38,390 Banc One Home Equity Trust 6.460% due 06/25/2029 2,333 2,327 Bank Boston Home Equity Loan Trust 6.280% due 11/25/2010 6 6 Bayview Financial Acquisition Trust 7.170% due 02/25/2029 (d) 4,308 4,328 6.130% due 11/25/2029 (d) 10,626 10,626 7.002% due 02/25/2030 (d) 20,512 20,519 5.920% due 07/25/2030 (d) 61,806 61,806 5.920% due 11/25/2030 (d) 42,300 42,300 BMCA Receivables Master Trust 6.840% due 09/20/2002 (d) 12,000 11,993 Brazos Student Loan Finance Co. 6.190% due 06/01/2023 (d) 55,700 55,576 7.170% due 12/01/2025 (d) 36,780 36,554 Capital Asset Research Funding LP 6.400% due 12/15/2004 207 210 5.905% due 12/15/2005 125 125 Captec Franchise Trust 7.892% due 10/15/2010 1,291 1,344 Champion Home Equity Loan Trust 6.908% due 03/25/2029 (d) 4,285 4,285 5.930% due 09/25/2029 13,214 13,238 Charming Shoppes Master Trust 7.069% due 08/15/2008 (d) 250 251 Chase Credit Card Master Trust 6.660% due 01/15/2007 645 674 Chase Funding Mortgage Loan Asset-Backed Certificates 6.840% due 10/25/2030 (d) 54,966 54,963 Chase Manhattan Grantor Trust 6.610% due 09/15/2002 214 215 Community Program Loan Trust 4.500% due 10/01/2018 23,416 22,120 4.500% due 04/01/2029 26,000 21,474 Compucredit Credit Card Master Trust 5.789% due 03/15/2007 (d) 16,000 16,000 Conseco Finance 7.520% due 05/15/2014 23,994 24,286 7.800% due 05/15/2020 175 185 5.534% due 10/15/2031 (d) 27,148 27,244 Conseco Finance Home Loan Trust 6.980% due 06/15/2011 12,305 12,409 8.080% due 02/15/2022 20,300 21,326 Conseco Finance Lease LLC 7.250% due 04/20/2003 25,500 25,772 Conseco Finance Securitizations Corp. 8.850% due 12/01/2030 20,000 22,451 7.180% due 05/01/2032 18,072 18,303 7.970% due 05/01/2032 25,600 26,956 8.310% due 05/01/2032 48,800 52,721 Contimortgage Home Equity Loan Trust 6.420% due 04/25/2014 63 63 6.400% due 06/15/2014 489 489 6.770% due 01/25/2018 41,700 42,221 6.990% due 03/15/2021 350 356 6.930% due 11/25/2022 36,800 37,783 7.220% due 01/15/2028 80 82 6.760% due 06/15/2028 (d) 1,607 1,603 6.829% due 08/15/2028 (d) 243 243 CPS Auto Trust 6.000% due 08/15/2003 53 53 Cross Country Master Credit Card Trust II 7.210% due 06/15/2006 (d) 800 807 CS First Boston Mortgage Securities Corp. 6.750% due 09/25/2028 6,960 6,946 Daimler-Benz Auto Grantor Trust 6.050% due 03/31/2005 1,063 1,064 Delta Funding Home Equity Loan Trust 6.140% due 03/15/2018 13,888 13,902 7.029% due 09/15/2029 (d) 9,603 9,643 6.940% due 06/15/2030 (d) 31,426 31,425 Denver Arena Trust 6.940% due 11/15/2019 272 261 Discover Card Master Trust I 6.996% due 10/16/2013 (d) 400 404 Duck Auto Grantor Trust 5.650% due 03/15/2004 2,361 2,369 7.260% due 05/15/2005 30,542 30,607 Embarcadero Aircraft Securitization Trust 5.644% due 08/15/2025 (d) 11,000 11,000 EQCC Home Equity Loan Trust 6.050% due 01/25/2010 68 68 6.548% due 04/25/2010 201 201 5.770% due 05/20/2010 68 68 6.780% due 10/15/2027 (d) 641 640 118 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Equivantage Home Equity Loan Trust 6.550% due 10/25/2025 $ 70 $ 71 First Alliance Mortgage Loan Trust 6.154% due 01/25/2025 (d) 533 534 5.960% due 03/20/2031 (d) 11,816 11,831 First Omni Bank Credit Card Master Trust 6.650% due 09/15/2003 (d) 1,500 1,502 First Security Auto Grantor Trust 5.970% due 04/15/2004 82 83 FMAC Loan Receivables Trust 7.900% due 04/15/2019 20 21 6.200% due 09/15/2020 133 134 6.500% due 09/15/2020 209 195 6.830% due 09/15/2020 680 657 Ford Credit Auto Owner Trust 6.200% due 04/15/2002 153 153 GE Capital Equipment Lease Trust 6.850% due 05/20/2008 (d) 250 255 GMAC Mortgage Corp. Loan Trust 7.089% due 11/18/2025 (d) 38,438 38,586 7.950% due 03/25/2030 34,303 34,901 Green Tree Financial Corp. 5.760% due 11/01/2018 145 142 8.400% due 06/15/2025 152 153 7.150% due 07/15/2027 24 24 6.490% due 03/15/2028 24,774 25,047 6.420% due 11/15/2028 786 791 6.870% due 02/01/2030 1,620 1,543 6.660% due 06/01/2030 1,405 1,284 5.600% due 12/01/2030 115 115 6.480% due 12/01/2030 55 53 5.510% due 02/01/2031 69 69 7.860% due 04/01/2031 400 410 Green Tree Floorplan Receivables Master Trust 5.921% due 11/15/2004 (d) 46,000 46,014 Green Tree Home Improvement Loan Trust 7.270% due 11/15/2029 (d) 2,649 2,643 Green Tree Recreational, Equipment, & Consumables 6.430% due 04/17/2006 2,035 2,054 6.715% due 02/01/2009 30,412 30,875 6.490% due 02/15/2018 13 13 6.180% due 06/15/2019 184 187 Greenpoint Manufactured Housing 7.270% due 06/15/2029 110 108 Harley-Davidson Eaglemark Motorcycle Trust 5.250% due 07/15/2003 43 43 Headlands Home Equity Loan Trust 5.814% due 12/15/2024 (d) 397 400 HFC Home Equity Loan 6.830% due 12/20/2016 152 152 Household Consumer Loan Trust 7.040% due 08/15/2006 (d) 17,025 16,440 IMC Home Equity Loan Trust 7.497% due 07/25/2026 (d) 589 603 5.740% due 08/20/2029 141 141 IMPAC Secured Assets CMN Owner Trust 7.770% due 07/25/2025 2,000 2,046 Indymac Home Equity Loan Asset-Backed Trust 6.888% due 10/25/2029 (d) 4,942 4,953 6.912% due 07/25/2030 (d) 9,867 9,883 Indymac Manufactured Housing Contract 6.170% due 12/25/2011 4,190 4,204 Korea National Housing 9.969% due 05/23/2001 3,000 3,015 Long Beach Auto Receivables Trust 6.940% due 09/19/2007 3,322 3,400 Long Beach Mortgage Loan Trust 5.240% due 04/21/2008 (d) 11,486 11,497 Marriott Vacation Club Owner Trust 5.930% due 09/20/2017 (d) 77,038 76,976 Mellon Bank Home Equity 6.520% due 07/25/2010 336 336 5.900% due 10/25/2010 10,932 10,955 Merit Securities Corp. 6.160% due 07/28/2033 4,398 4,398 7.880% due 12/28/2033 34,400 35,646 Metris Master Trust 5.658% due 04/20/2006 (d) 20,000 20,143 Metropolitan Asset Funding, Inc. 7.081% due 04/25/2029 (d) 12,231 12,063 Mid-State Trust 8.330% due 04/01/2030 58,707 63,259 MLCC Mortgage Investors, Inc. 5.949% due 03/15/2025 (d) 364 365 MMCA Automobile Trust 6.300% due 06/15/2002 110 110 Morgan Stanley ABS Capital, Inc. 6.930% due 08/25/2030 (d) 143,211 143,479 MPC Natural Gas Funding Trust 6.200% due 03/15/2013 9,316 9,680 MSDWCC Heloc Trust 6.908% due 09/25/2010 (d) 35,556 35,457 Myra-United Mexican States 6.438% due 10/20/2006 (d) 378 366 6.373% due 12/23/2006 1,275 1,237 6.488% due 12/23/2006 (d) 7,051 6,840 7.500% due 12/23/2006 (d) 5,343 5,181 7.750% due 12/23/2006 (d) 3,208 3,111 5.688% due 12/23/2006 (d) 851 826 National Medical Care 6.625% due 09/30/2003 (d) 19,315 19,121 6.313% due 09/30/2003 11,381 11,267 New Holland Equipment Receivables Trust 6.390% due 10/15/2002 84 85 New York City Tax Lien 6.460% due 05/25/2005 87 87 NPF VI, Inc. 6.220% due 06/01/2002 17,150 16,941 NPF XII, Inc. 7.050% due 06/01/2003 50,750 51,495 5.931% due 11/01/2003 (d) 16,000 16,000 Option One Mortgage Loan Trust 5.880% due 05/25/2029 32 32 5.340% due 09/25/2030 (d) 47,572 47,650 Provident Bank Equipment Lease Trust 5.830% due 11/25/2011 (d) 36,372 36,372 Provident Bank Home Equity Loan Trust 6.920% due 06/25/2021 (d) 32,539 32,597 Providian Gateway Master Trust 5.380% due 03/15/2007 28,900 28,900 5.849% due 03/16/2009 (d) 23,000 23,000 Providian Master Trust 6.250% due 06/15/2007 25 26 PSB Lending Home Loan Owner Trust 6.830% due 05/20/2018 3,272 3,296 Residential Asset Mortgage Products, Inc. 6.004% due 09/25/2030 (d) 41,721 41,521 7.980% due 12/25/2030 24,463 25,541 Residential Asset Securities Corp. 6.720% due 04/25/2014 (d) 79 79 6.960% due 07/25/2014 12,477 12,478 6.240% due 02/25/2017 902 901 6.600% due 01/25/2020 13,200 13,311 7.075% due 09/25/2020 190 193 8.000% due 09/25/2021 (d) 5,060 5,210 6.920% due 10/25/2027 (d) 1,677 1,688 Residential Asset Securitization Trust 6.750% due 03/25/2028 40,000 39,683 Residential Funding Mortgage Securities, Inc. 10.836% due 06/01/2001 72,450 72,450 RJR Nabisco 7.500% due 01/01/2002 (d) 19,948 19,948 Ryder Vehicle Lease Trust 6.430% due 01/15/2003 406 407 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 119 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SallieMae 5.936% due 04/25/2004 (d) $ 3,049 $ 3,053 6.824% due 07/25/2004 (d) 832 831 5.901% due 10/25/2005 (d) 18,203 18,205 6.825% due 10/25/2005 (d) 11,476 11,468 6.628% due 04/25/2006 (d) 69,553 69,441 Salomon Brothers Mortgage Securities VII 7.020% due 09/25/2029 (d)(i) 330 331 5.584% due 11/15/2029 (d) 17,045 17,117 6.463% due 11/15/2029 (d)(i) 7,800 7,823 Saxon Asset Securities Trust 7.585% due 12/25/2014 45 45 5.760% due 05/25/2029 (d) 5,946 5,950 Sears Credit Account Master Trust 6.050% due 01/15/2008 500 512 Southern Pacific Secured Assets Corp. 5.700% due07/25/2029 (d) 39,146 39,035 Standard Credit Card Master Trust 8.250% due 11/07/2003 80 82 Team Fleet Financing Corp. 7.350% due 05/15/2003 30 31 The Money Store Home Equity Trust 7.550% due 02/15/2020 196 197 6.345% due 11/15/2021 479 480 6.490% due 10/15/2026 10,354 10,495 Toyota Auto Lease Trust 6.450% due 04/26/2004 300 300 UCFC Home Equity Loan 8.200% due 09/15/2027 70 72 6.870% due 07/15/2029 70 69 UCFC Manufactured Housing Contract 6.680% due 01/15/2010 (d) 1,785 1,786 UniCapital Equipment Contract 6.540% due 07/23/2002 8,657 8,665 USAA Auto Loan Grantor Trust 6.150% due 05/15/2004 651 650 5.800% due 01/15/2005 1,772 1,784 WFS Financial Owner Trust 6.411% due 07/20/2002 7,817 7,829 6.920% due 01/20/2004 27,125 27,631 WMC Mortgage Loan 7.070% due 10/15/2029 74,741 74,787 ------------ Total Asset-Backed Securities 2,838,269 (Cost $2,818,838) ------------ -------------------------------------------------------------------------------- SOVEREIGN ISSUES 1.2% -------------------------------------------------------------------------------- Hellenic Republic 6.938% due 06/06/2001 (d) 20,000 20,026 Hydro-Quebec 7.375% due 02/01/2003 150 156 6.875% due 09/29/2049 (d) 2,000 1,787 Kingdom of Jordan 6.000% due 12/23/2023 7,000 5,330 Kingdom of Sweden 10.250% due 11/01/2015 500 647 Province of Manitoba 7.750% due 02/01/2002 1,000 1,023 Province of New Brunswick 7.125% due 10/01/2002 1,700 1,752 Province of Newfoundland 9.000% due 06/01/2019 500 643 Province of Nova Scotia 9.375% due 07/15/2002 1,000 1,056 Province of Ontario 7.750% due 06/04/2002 200 207 7.625% due 06/22/2004 1,000 1,068 7.000% due 08/04/2005 1,000 1,065 6.000% due 02/21/2006 1,800 1,846 5.500% due 10/01/2008 12,000 11,898 Province of Quebec 7.500% due 07/15/2002 6,000 6,206 8.800% due 04/15/2003 1,100 1,184 6.810% due 06/11/2004 (d) 15,500 15,501 6.500% due 01/17/2006 2,000 2,091 6.620% due 04/09/2026 25,000 26,560 Republic of Argentina 5.563% due 03/31/2005 (d) 28,800 24,774 Republic of Brazil 7.625% due 04/15/2006 241,286 218,699 10.125% due 05/15/2027 14,000 10,640 Republic of Bulgaria 3.000% due 07/28/2012 (d) 3,624 2,744 7.750% due 07/28/2024 (d) 320 239 Republic of Croatia 7.000% due 02/27/2002 7,650 7,665 7.750% due 07/31/2006 (d) 2,911 2,846 6.250% due 07/31/2010 (d) 31,750 30,718 Republic of Kazakhstan 8.375% due 10/02/2002 5,000 5,104 Republic of Panama 7.875% due 02/13/2002 1,850 1,866 7.733% due 05/10/2002 (d) 1,975 1,991 4.500% due 07/17/2014 7,675 6,470 Republic of Peru 3.750% due 03/07/2017 3,000 1,868 4.500% due 03/07/2017 (d) 5,750 3,924 3.750% due 03/07/2017 8,000 5,002 Republic of Poland 6.000% due 10/27/2014 9,000 8,764 3.500% due 10/27/2024 (d) 53,940 38,972 4.250% due 10/27/2024 1,600 1,268 Republic of South Africa 9.125% due 05/19/2009 15,000 15,788 State of Israel 6.200% due 06/14/2003 25 25 United Kingdom Gilt 8.000% due 09/27/2013 (j) 1,900 3,497 United Mexican States 9.616% due 04/07/2004 (d) 14,436 14,833 8.500% due 02/01/2006 3,781 3,866 6.250% due 12/31/2019 8,860 7,907 ------------ Total Sovereign Issues 519,516 (Cost $515,566) ------------ -------------------------------------------------------------------------------- FOREIGN CURRENCY-DISSUESATED3.1% (f)(g) -------------------------------------------------------------------------------- Canada Treasury Bill 0.000% due 04/12/2001 C$ 20 13 0.000% due 05/10/2001 220 139 Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 73,000 32,372 Halifax Group Euro Finance 7.627% due 12/29/2049 EC 8,500 7,863 KBC Bank Fund Trust IV 8.220% due 11/29/2049 20,764 19,154 Korea Development Bank 4.885% due 05/14/2001 DM 70,000 31,365 2.560% due 06/26/2001 JY 4,000,000 31,889 Korea Electric Power Corp. 3.882% due 10/31/2002 (d) DM 18,900 8,390 Lloyds TSB Capital 7.375% due 02/07/2049 EC 16,000 14,731 Newcourt Credit Group, Inc. 7.625% due 06/28/2001 C$ 9,400 5,987 Republic of Austria 5.500% due 01/15/2010 (j) EC 900 817 Republic of Brazil 8.250% due 11/26/2001 2,000 1,772 Republic of Germany 5.000% due 05/20/2005 155 139 4.125% due 07/04/2008 (j) 15,500 13,205 120 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 4.500% due 07/04/2009 (j) EC 71,300 $ 62,023 5.375% due 01/04/2010 (j) 35,300 32,476 5.250% due 07/04/2010 156,560 143,007 5.250% due 01/04/2011 (j) 294,780 269,108 6.250% due 01/04/2024 (j) 128,451 125,373 6.500% due 07/04/2027 (j) 198,710 200,816 5.600% due 01/04/2028 (j) 108,710 98,594 6.250% due 01/04/2030 (j) 100 99 Royal Bank of Scotland Group PLC 8.300% due 03/31/2049 BP 85,000 103,104 Treuhandanstalt 6.250% due 03/04/2004 EC 60 55 United Mexican States 6.000% due 03/28/2002 JY 100,000 830 3.100% due 04/24/2002 2,542,000 20,470 8.750% due 05/30/2002 BP 23,000 33,184 10.375% due 01/29/2003 DM 200 95 7.000% due 06/02/2003 C$ 30,200 19,158 7.432% due 04/07/2004 (d) EC 18,181 16,223 6.750% due 06/06/2006 JY 2,000,000 18,678 7.500% due 03/08/2010 EC 5,000 4,341 1.103% due 12/31/2019 (d) JY 1,662,500 12,936 ------------ Total Foreign 1,328,406 Currency-Denominated Issues ------------ (Cost $1,374,968) -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- General National Mortgage Association (OTC) 6.000% due 05/21/2031 Strike @ 90.281 Exp. 05/04/2001 $ 497,000 1 General National Mortgage Association (OTC) 7.500% due 05/21/2031 Strike @ 96.641 Exp. 05/04/2001 940,000 2 Harborview Mortgage Loan Trust (OTC) 7.470% due 08/19/2030 Strike @ 100.000 Exp. 05/01/2005 22,975 0 ------------ Total Purchased Put Options 3 (Cost $112) ------------ -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 0.0% -------------------------------------------------------------------------------- Banking & Finance 0.0% Bell Atlantic Financial Services 5.750% due 04/01/2003 1,500 1,505 Cox Communications, Inc. 0.426% due 04/19/2020 25 10,063 ------------ Total Convertible Bonds & Notes 11,568 (Cost $14,839) ------------ -------------------------------------------------------------------------------- PREFERRED SECURITY 0.8% -------------------------------------------------------------------------------- Shares DG Funding Trust 7.150% due 12/29/2049 (d) 35,150 358,530 ------------ Total Preferred Security 358,530 (Cost $351,502) ------------ -------------------------------------------------------------------------------- PREFERRED STOCK 0.2% -------------------------------------------------------------------------------- Banco Bilbao Vizcaya International 9.750% due 12/31/2049 266,217 $ 6,909 Centaur Funding Corp. 9.080% due 04/21/2020 125 131 CSC Holdings, Inc. 11.125% due 04/01/2008 27,038 2,947 Fortis Amev NV 6.430% due 12/31/2049 85 11,220 5.080% due 12/31/2049 (d) 86 11,352 Home Ownership Funding 13.331% due 12/31/2049 1,125 849 SI Financing Trust I 9.500% due 06/30/2026 396,194 10,024 TCI Communications, Inc. 9.720% due 12/31/2036 622,553 15,844 10.000% due 05/31/2045 49,000 1,230 ------------ Total Preferred Stock 60,506 (Cost $60,018) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 11.8% -------------------------------------------------------------------------------- Principal Amount (000s) Certificates of Deposit 0.1% Mexico Credit Link 11.384% due 02/22/2002 $ 29,500 30,247 11.804% due 02/25/2002 2,000 2,088 ------------ 32,335 ------------ Commercial Paper 11.2% Abbey National North America 5.500% due 04/10/2001 31,500 31,462 5.090% due 04/19/2001 2,400 2,394 5.340% due 04/19/2001 1,500 1,496 5.350% due 04/19/2001 6,800 6,783 5.450% due 04/19/2001 1,100 1,097 5.420% due 04/26/2001 2,200 2,192 5.345% due 05/02/2001 126,400 125,837 5.050% due 08/01/2001 2,000 1,967 5.060% due 08/01/2001 1,000 984 4.930% due 08/01/2001 35,000 34,426 5.010% due 08/06/2001 700 688 5.040% due 08/06/2001 41,800 41,089 5.020% due 08/07/2001 74,200 72,928 5.050% due 08/08/2001 3,700 3,636 5.040% due 08/08/2001 600 590 5.020% due 08/08/2001 6,700 6,584 5.010% due 08/08/2001 17,100 16,805 Abbey National PLC 5.240% due 04/10/2001 200 200 4.870% due 05/02/2001 16,800 16,732 5.070% due 05/02/2001 2,100 2,091 4.700% due 09/05/2001 3,500 3,428 4.710% due 09/06/2001 16,800 16,451 Abbott Laboratories 5.100% due 04/05/2001 19,600 19,592 ABN Amro North America Finance, Inc. 5.340% due 04/02/2001 600 600 Alcoa, Inc. 5.310% due 04/02/2001 11,300 11,300 5.300% due 04/10/2001 40,000 39,953 5.170% due 04/11/2001 800 799 5.300% due 04/20/2001 439 438 5.170% due 04/25/2001 300 299 American Express Co. 5.150% due 04/04/2001 169,700 169,651 5.240% due 04/04/2001 1,000 1,000 5.300% due 04/04/2001 32,500 32,490 5.320% due 04/04/2001 49,400 49,385 5.620% due 04/06/2001 3,700 3,698 6.240% due 04/06/2001 2,600 2,598 5.490% due 04/06/2001 800 800 5.410% due 04/06/2001 300 300 6.360% due 04/06/2001 600 600 4.950% due 04/27/2001 100 100 4.840% due 05/15/2001 8,000 7,954 4.860% due 05/15/2001 4,900 4,872 Anz, Inc. 5.410% due 04/18/2001 3,400 3,392 Becton Dickinson & Co. 5.250% due 04/11/2001 2,400 2,397 6.110% due 04/25/2001 2,200 2,191 5.350% due 04/25/2001 23 23 4.920% due 06/20/2001 400 396 4.940% due 07/25/2001 1,500 1,477 4.800% due 07/25/2001 5,300 5,218 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 121 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Bellsouth Capital Funding Corp. 5.340% due 04/11/2001 $ 32,300 $ 32,257 Campbell Soup Co. 5.440% due 04/16/2001 200 200 CBA (de) Finance 5.340% due 04/11/2001 3,900 3,895 4.960% due 04/23/2001 19,300 19,244 4.990% due 04/23/2001 6,300 6,282 5.040% due 04/23/2001 100 100 5.020% due 08/09/2001 1,800 1,769 5.040% due 08/09/2001 3,400 3,339 CDC 5.130% due 04/25/2001 1,000 997 5.460% due 04/25/2001 600 598 Coca-Cola Co. 5.100% due 04/02/2001 3,300 3,300 4.990% due 04/12/2001 100 100 5.080% due 04/12/2001 4,400 4,394 4.580% due 07/12/2001 500 493 4.600% due 07/12/2001 2,500 2,465 E.I. Du Pont 5.170% due 04/05/2001 27,500 27,480 Executive Jet, Inc. 4.940% due 04/18/2001 1,900 1,896 4.960% due 04/25/2001 15,350 15,301 4.960% due 04/27/2001 10,000 9,966 5.330% due 05/23/2001 1,200 1,191 4.860% due 06/27/2001 10,000 9,884 5.280% due 06/27/2001 6,600 6,523 4.970% due 08/01/2001 35,000 34,426 5.040% due 08/08/2001 3,100 3,046 5.030% due 08/08/2001 9,000 8,845 Exxon Mobil 5.390% due 04/04/2001 2,700 2,699 5.140% due 04/04/2001 5,500 5,498 Fannie Mae 5.810% due 05/24/2001 5,300 5,256 4.890% due 06/07/2001 400 396 4.720% due 08/15/2001 40,600 39,864 4.685% due 09/06/2001 19,300 18,899 Federal Farm Credit Bank 4.630% due 08/29/2001 3,000 2,941 4.650% due 08/29/2001 8,500 8,332 Federal Home Loan Bank 4.980% due 04/05/2001 50,000 49,987 4.910% due 05/11/2001 326 324 4.675% due 09/07/2001 5,200 5,092 Freddie Mac 4.980% due 04/02/2001 17,900 17,893 4.950% due 04/03/2001 2,000 2,000 5.250% due 04/17/2001 263 262 5.320% due 04/26/2001 3,000 2,989 6.320% due 04/26/2001 325 324 4.700% due 05/16/2001 72,500 72,084 Gannett Co. 4.990% due 04/11/2001 56,400 56,330 5.090% due 04/11/2001 8,500 8,489 5.000% due 04/20/2001 34,100 34,015 General Electric Capital Corp. 5.200% due 04/03/2001 45,300 45,293 5.090% due 04/03/2001 800 800 4.990% due 04/03/2001 200 199 5.410% due 04/03/2001 6,400 6,399 4.970% due 04/04/2001 3,700 3,699 4.990% due 04/04/2001 800 800 5.170% due 04/04/2001 300 300 5.350% due 04/04/2001 6,700 6,698 5.370% due 04/04/2001 4,400 4,399 5.390% due 04/04/2001 6,800 6,798 5.480% due 04/05/2001 2,900 2,899 5.440% due 04/18/2001 400 398 5.200% due 04/18/2001 1,600 1,596 5.190% due 04/18/2001 1,100 1,098 4.980% due 04/25/2001 2,300 2,293 5.450% due 04/25/2001 500 498 5.370% due 04/25/2001 3,000 2,990 5.330% due 04/25/2001 3,300 3,289 5.320% due 04/25/2001 11,500 11,461 5.470% due 04/25/2001 60,400 60,189 5.020% due 04/25/2001 1,000 997 4.940% due 04/25/2001 1,600 1,594 4.900% due 04/25/2001 54,200 54,030 0.040% due 04/25/2001 3,000 2,990 5.090% due 04/25/2001 1,500 1,495 5.180% due 04/25/2001 1,800 1,794 5.350% due 05/09/2001 53,500 53,206 4.690% due 05/30/2001 1,000 992 5.480% due 05/30/2001 5,000 4,959 5.340% due 05/30/2001 4,700 4,661 4.940% due 05/30/2001 200 198 4.780% due 05/30/2001 300 298 4.870% due 05/30/2001 3,000 2,975 5.310% due 06/06/2001 1,300 1,288 5.520% due 06/06/2001 4,200 4,162 5.340% due 06/06/2001 1,300 1,288 5.140% due 06/06/2001 7,800 7,729 5.130% due 06/06/2001 2,400 2,378 5.920% due 06/06/2001 32,900 32,601 5.220% due 06/06/2001 900 892 4.600% due 07/18/2001 3,300 3,255 5.000% due 08/15/2001 200 196 4.930% due 08/22/2001 83,000 81,425 Gillette Co. 5.060% due 04/17/2001 200 200 5.440% due 04/17/2001 9,400 9,379 4.910% due 08/21/2001 1,100 1,079 Glaxo Wellcome 4.970% due 04/30/2001 79,500 79,193 Goldman Sachs Group 4.540% due 09/19/2001 100 98 Halifax Building Society 5.220% due 04/18/2001 300 299 5.350% due 04/18/2001 14,400 14,366 5.370% due 04/18/2001 2,300 2,295 5.390% due 04/18/2001 4,100 4,090 5.480% due 04/18/2001 4,800 4,788 5.010% due 05/30/2001 1,200 1,190 4.950% due 08/01/2001 35,800 35,213 5.000% due 08/02/2001 25,000 24,587 5.080% due 08/08/2001 3,500 3,437 5.050% due 08/08/2001 2,900 2,850 4.700% due 09/04/2001 11,000 10,774 Heinz Corp. 4.890% due 05/01/2001 1,200 1,195 KFW International Finance, Inc. 5.090% due 04/23/2001 3,800 3,789 5.340% due 04/24/2001 2,200 2,193 5.320% due 05/30/2001 1,500 1,488 4.910% due 05/30/2001 4,100 4,066 5.270% due 05/30/2001 4,300 4,265 5.820% due 06/06/2001 20,000 19,818 5.260% due 06/06/2001 200 198 5.460% due 06/06/2001 4,000 3,964 4.930% due 07/30/2001 40,000 39,354 5.000% due 08/08/2001 3,700 3,636 5.010% due 08/08/2001 1,200 1,179 5.070% due 08/08/2001 1,200 1,179 Monsanto Co. 5.210% due 04/11/2001 1,000 999 4.970% due 08/08/2001 1,100 1,081 4.980% due 08/15/2001 2,000 1,963 4.650% due 08/16/2001 2,200 2,160 4.920% due 08/16/2001 6,650 6,529 4.800% due 08/27/2001 40,000 39,217 5.020% due 08/29/2001 20,000 19,604 122 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Morgan Stanley Group, Inc. 5.050% due 04/11/2001 $ 175,100 $ 174,879 4.950% due 04/25/2001 500 498 Motorola, Inc. 6.210% due 04/20/2001 200 199 National Australia Funding 5.070% due 04/04/2001 2,123 2,122 5.100% due 04/05/2001 184,900 184,821 National Rural Utilities Cooperative Finance Corp. 5.190% due 04/11/2001 4,100 4,095 5.140% due 04/11/2001 5,100 5,093 4.870% due 04/11/2001 5,200 5,194 4.940% due 04/11/2001 1,600 1,598 4.920% due 04/17/2001 4,700 4,690 5.250% due 05/24/2001 190 189 5.340% due 05/24/2001 1,000 992 5.300% due 05/24/2001 2,600 2,580 5.240% due 05/24/2001 1,400 1,389 5.180% due 05/24/2001 300 298 4.820% due 05/24/2001 23,500 23,336 4.810% due 05/24/2001 200 199 5.290% due 05/24/2001 4,500 4,466 4.880% due 05/25/2001 8,900 8,836 4.910% due 05/25/2001 42,000 41,696 4.550% due 08/24/2001 400 393 5.070% due 08/24/2001 2,600 2,547 Reseau Ferre De France 4.590% due 07/25/2001 1,700 1,674 4.620% due 07/25/2001 3,500 3,446 4.620% due 08/16/2001 8,900 8,738 SBC Communications, Inc. 5.300% due 04/03/2001 50,300 50,293 5.330% due 04/04/2001 400 400 5.340% due 04/04/2001 12,000 11,996 5.290% due 04/10/2001 12,400 12,385 5.330% due 04/16/2001 22,000 21,954 Swedbank, Inc. 5.390% due 04/12/2001 2,000 1,997 5.080% due 04/12/2001 980 979 5.370% due 04/12/2001 3,800 3,794 5.160% due 04/23/2001 2,300 2,293 4.930% due 04/25/2001 12,400 12,361 5.140% due 04/25/2001 3,200 3,189 4.860% due 05/30/2001 20,000 19,836 5.010% due 05/30/2001 7,400 7,339 5.290% due 05/30/2001 1,700 1,686 5.340% due 05/30/2001 2,600 2,579 5.370% due 05/30/2001 1,000 992 5.000% due 08/06/2001 12,200 11,992 5.010% due 08/06/2001 12,700 12,484 4.850% due 08/06/2001 2,100 2,064 5.020% due 08/08/2001 23,200 22,799 5.060% due 08/08/2001 4,600 4,521 5.100% due 08/08/2001 6,600 6,486 4.890% due 08/08/2001 1,600 1,572 5.010% due 08/09/2001 27,600 27,120 4.790% due 08/15/2001 8,600 8,444 4.630% due 08/23/2001 1,300 1,275 4.900% due 08/23/2001 6,000 5,885 4.700% due 09/05/2001 1,300 1,273 4.740% due 09/05/2001 14,100 13,809 UBS Finance, Inc. 0.400% due 04/02/2001 15,000 15,000 5.400% due 04/02/2001 403,600 403,600 5.300% due 04/04/2001 101,000 100,970 5.010% due 04/18/2001 300 299 5.340% due 04/18/2001 4,400 4,389 5.460% due 04/18/2001 1,600 1,595 5.360% due 05/07/2001 20,000 19,832 5.410% due 05/16/2001 3,800 3,774 5.340% due 05/16/2001 16,000 15,895 5.350% due 05/16/2001 4,200 4,172 5.820% due 05/30/2001 273,700 271,453 5.510% due 06/06/2001 9,200 9,116 5.830% due 06/06/2001 1,000 991 5.920% due 06/06/2001 93,600 92,748 5.520% due 06/06/2001 2,900 2,874 5.240% due 06/06/2001 4,300 4,261 5.190% due 06/06/2001 12,000 11,890 5.340% due 06/06/2001 2,300 2,279 4.670% due 06/13/2001 63,000 62,316 4.940% due 06/13/2001 2,200 2,178 4.970% due 06/13/2001 300 297 5.160% due 06/13/2001 7,100 7,029 5.190% due 06/13/2001 2,400 2,376 5.290% due 06/13/2001 125,000 123,753 4.970% due 08/01/2001 57,000 56,065 5.010% due 08/01/2001 35,600 35,016 5.050% due 08/01/2001 1,600 1,574 4.550% due 08/02/2001 2,400 2,360 5.040% due 08/02/2001 42,000 41,305 5.050% due 08/02/2001 5,000 4,917 5.070% due 08/02/2001 9,900 9,730 4.790% due 08/07/2001 100 98 5.030% due 08/07/2001 248,500 244,241 5.030% due 08/08/2001 35,000 34,396 5.070% due 08/08/2001 6,600 6,486 5.040% due 08/08/2001 7,800 7,665 4.900% due 08/08/2001 200 197 5.050% due 08/08/2001 300 295 5.010% due 08/08/2001 29,600 29,089 4.590% due 08/15/2001 2,100 2,062 4.760% due 08/15/2001 1,100 1,080 4.820% due 08/15/2001 3,100 3,044 4.740% due 09/04/2001 125,000 122,435 4.750% due 09/05/2001 6,500 6,366 4.740% due 09/05/2001 9,500 9,304 4.740% due 09/06/2001 44,400 43,478 4.740% due 09/12/2001 65,000 63,604 Verizon Global Funding 5.320% due 04/02/2001 1,700 1,700 5.310% due 04/05/2001 2,600 2,599 5.340% due 04/05/2001 5,300 5,298 4.960% due 05/04/2001 700 697 5.010% due 05/16/2001 4,800 4,771 4.980% due 05/25/2001 400 397 4.750% due 06/15/2001 300 297 Walt Disney Co. 4.690% due 08/07/2001 1,800 1,769 4.900% due 08/07/2001 3,400 3,342 Williams Cos., Inc. 7.231% due 04/10/2001 23,200 23,209 7.231% due 04/10/2001 10,700 10,700 7.231% due 04/10/2001 10,300 10,304 Wisconsin Electric Power & Light 5.040% due 04/12/2001 200 200 5.100% due 04/12/2001 800 799 ----------- 4,774,003 ----------- Repurchase Agreement 0.4% Daiwa Securities 5.150% due 04/02/2001 165,000 165,000 (Dated 03/30/2001. Collateralized by ----------- U.S. Treasury Bills 4.420% due 09/13/2001 valued at $168,527. Repurchase proceeds are $165,071.) U.S. Treasury Bills 0.1% 5.073% due 05/17/2001 (b) 21,685 21,566 ----------- Total Short-Term Instruments 4,992,904 (Cost $4,992,031) ----------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 123 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 -------------------------------------------------------------------------------- Total Investments (a) 151.2% $ 64,127,213 (Cost $63,623,558) Written Options (c) (0.1%) (42,637) (Premiums $35,755) Other Assets and Liabilities (Net) (51.1%) (21,679,183) ------------ Net Assets 100.0% $ 42,405,393 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $63,665,744 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 781,956 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (353,054) ------------ Unrealized appreciation-net $ 428,902 ------------ (b) Securities with an aggregate market value of $246,132 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- Eurodollar March Futures (03/2002) 762 $ 429 Eurodollar June Futures (06/2002) 8,899 1,470 Eurodollar September Futures (09/2002) 8,899 1,289 Eurodollar December Futures (12/2002) 8,899 984 Eurodollar March Futures (03/2003) 8,137 586 Municipal Bond (06/2001) 711 (513) EuroBond 10 Year Note (06/2001) 30,855 30,576 U.S. Treasury 5 Year Note (06/2001) 11,913 (6,762) U.S. Treasury 10 Year Note (06/2001) 219 67 U.S. Treasury 30 Year Bond (06/2001) 26,537 (7,889) Euribor Futures (06/2001) 823 1,454 Euribor Futures (03/2002) 4,117 4,313 Government of Japan 10 Year Note (06/2001) 39 (41) United Kingdom 90 Day LIBOR Futures (03/2002) 275 219 United Kingdom 90 Day LIBOR Futures (06/2002) 275 207 United Kingdom 90 Day LIBOR Futures (09/2002) 275 190 United Kingdom 90 Day LIBOR Futures (12/2002) 275 199 ------------- $ 26,778 ------------- (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/25/2001 93,100,000 $ 894 $ 1,621 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/25/2001 186,100,000 1,795 3,240 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 253,000,000 2,459 4,602 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 84,300,000 773 1,533 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/31/2001 168,800,000 1,563 3,070 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 06/04/2001 244,200,000 1,444 4,617 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/21/2001 74,600,000 2,286 1,028 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/22/2001 92,700,000 2,718 1,283 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/27/2001 74,600,000 2,137 1,056 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 12/03/2001 93,600,000 1,937 1,358 Put - CME Eurodollar December Futures Strike @ 95.00 Exp. 12/17/2001 1,714 720 514 Put - CME Eurodollar December Futures Strike @ 95.25 Exp. 12/17/2001 9,545 4,772 5,250 Call - CBOT U.S.Treasury Note June Futures Strike @ 107.00 Exp. 05/26/2001 1,885 1,198 1,590 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 13,125 7,161 7,177 Put - CBOT U.S. Treasury Note June Futures Strike @ 105.00 Exp. 05/26/2001 5,303 2,906 3,397 ---------------------------- $ 35,755 $ 42,637 ---------------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Security is in default. (f) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Sell C$ 36,714 04/2001 $ 460 Buy EC 1,338,388 04/2001 (64,986) Sell 1,335,461 04/2001 16,412 Buy 1,059,188 06/2001 (3,998) Sell BP 96,680 05/2001 4,711 Buy HF 2,000,000 09/2001 (153) Buy JY 104,105,954 04/2001 (19,233) Sell 104,105,954 04/2001 19,353 Sell 103,755,954 06/2001 16,401 Sell N$ 50,890 04/2001 881 ------------- $ (30,152) ------------- 124 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes -------------------------------------------------------------------------------- (g) Principal amount denoted in indicated currency: BP - British Pound C$ - Canadian Dollar DM - German Mark EC - Euro HF - Hungarian Forint JY - Japanese Yen N$ - New Zealand Dollar (h) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on $13,033,000 notional amount with 3-month LIBOR plus 1.600% and pay $25,000,000 notional amount with a fixed rate equal to 0.426%. Broker: Lehman Brothers Exp. 04/19/2005 $ 13,033 $ 1 Receive floating rate based on 3-month LIBOR plus 0.500% and pay a fixed rate equal to 7.600%. Broker: Lehman Brothers Exp. 07/15/2003 35,000 (1,647) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.295%. Broker: Goldman Sachs Exp. 04/14/2008 JY 11,635,000 (8,598) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.305%. Broker: Goldman Sachs Exp. 04/15/2008 7,563,000 (5,627) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.669%. Broker: Goldman Sachs Exp. 05/18/2007 51,000,000 (21,103) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.305%. Broker: Goldman Sachs Exp. 04/15/2008 377,000 (121) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.669%. Broker: Goldman Sachs Exp. 05/18/2007 1,500,000 (550) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.295%. Broker: Goldman Sachs Exp. 04/14/2008 JY 580,000 $ (184) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.340%. Broker: Goldman Sachs Exp. 10/07/2007 24,500,000 (18,409) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.495%. Broker: Goldman Sachs Exp. 09/16/2008 JY 7,000,000 $ (1,957) Receive a fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2006 $ 385,300 4,258 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.805%. Broker: Morgan Stanley Dean Witter Exp. 01/11/2011 JY 1,389,000 (488) Receive a fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Dean Witter Exp. 06/15/2006 $ 797,200 2,399 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.757%. Broker: Merrill Lynch Exp. 01/11/2001 JY 10,000,000 (3,167) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.771%. Broker: Morgan Stanley Dean Witter Exp. 01/11/2001 42,373,000 (13,860) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.777%. Broker: Goldman Sachs Exp. 01/12/2011 48,070,000 (15,915) Receive a fixed rate equal to 5.633% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/02/2004 BP 211,900 2,770 Receive a fixed rate equal to 5.626% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 02/02/2004 716,100 9,200 Receive a fixed rate equal to 5.560% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 02/27/2003 241,400 1,249 Receive a fixed rate equal to 5.387% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 02/28/2003 10,000 48 Receive a fixed rate equal to 5.405% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/28/2003 200,000 1,042 Receive a fixed rate equal to 5.518% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/28/2004 52,600 491 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 125 PIMCO Schedule of Investments A, B, and C Classes (Cont.) Total Return Fund March 31, 2001 -------------------------------------------------------------------------------- Receive a fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/02/2004 BP 96,500 $ 873 Receive a fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/02/2004 52,200 472 Receive a fixed rate equal to 5.478% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/08/2004 500,000 4,145 Receive a fixed rate equal to 5.471% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/15/2006 1,020,300 6,403 Receive a fixed rate equal to 5.484% and pay floating rate based on 6-month BP-LIBOR. Broker: J.P. Morgan Exp. 03/15/2006 421,100 2,581 Receive a fixed rate equal to 5.421% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/15/2006 147,000 821 Recieve floating rate based on 6-month BP-LIBOR and pay a fixed rate equal to 5.220%. Broker: J.P. Morgan Exp. 09/19/2002 280,500 32 Receive a fixed rate equal to 5.308% and pay floating rate based on 6-month BP-LIBOR. Broker: J.P. Morgan Exp. 03/19/2006 280,500 (1,456) Receive a fixed rate equal to 5.305% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/19/2006 629,900 (2,716) Receive floating rate based on 6-month BP-LIBOR and pay a fixed rate equal to 5.215%. Broker: Goldman Sachs Exp. 09/19/2002 629,900 5 Receive a fixed rate equal to 5.207% and pay floating rate based on 6-month BP-LIBOR. Broker: J.P. Morgan Exp. 03/15/2004 197,100 (349) Receive a fixed rate equal to 5.207% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 03/15/2004 167,300 (296) Receive a fixed rate equal to 9.250% and pay a fixed rate equal to 5.050%. In the event of default of Republic of Argentina Floating Rate Notes and/or Spread-Adjusted Notes, the Fund can put the bond to the counterparty at par. Broker: Deutsche Bank AG New York Exp. 05/03/2001 6,000 (201) Receive fixed rate equal to 0.650% and the Fund will pay to the counterparty at par in the event of default of Niagara Mohawk Corp. 7.750% due 10/01/2008. Broker: Lehman Brothers Exp. 12/31/2004 50,000 3 Receive fixed rate equal to 0.400% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.400% due 02/01/2004. Broker: Goldman Sachs Exp. 11/10/2002 20,000 1 Receive fixed rate equal to 0.510% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 01/25/2005 10,000 0 Receive fixed rate equal to 5.600% and the Fund will pay to the counterparty at par in the event of default of the Republic of Venezuela 9.250% due 09/15/2027. Broker: Deutsche Bank AG New York Exp. 04/04/2001 25,000 14 Receive fixed rate equal to 5.850% and the Fund will pay to the counterparty at par in the event of default of the Republic of Venezuela 9.250% due 09/15/2027. Broker: Deutsche Bank AG New York Exp. 04/17/2001 10,000 6 Receive fixed rate equal to 0.250% and the Fund will pay to the counterparty at par in the event of default of Wisconsin Electric Power 6.625% due 11/16/2006. Broker: Lehman Brothers Exp. 04/18/2003 25,000 1 Receive fixed rate equal to 1.900% and the Fund will pay to the counterparty at par in the event of default of the Republic of Brazil based on 6-month LIBOR plus 0.813% due 04/15/2006. Broker: Credit Suisse First Boston International Exp. 05/03/2001 50,000 415 Receive fixed rate equal to 1.300% and the Fund will pay to the counterparty at par in the event of default of United Mexican States 9.875% due 01/15/2007. Broker: Salomon Brothers, Inc. Exp. 05/09/2002 50,000 7 Receive fixed rate equal to 0.100% and the Fund will pay to the counterparty at par in the event of default of General Electric Capital Corp. 7.250% due 02/02/2005. Broker: J.P. Morgan Exp. 05/19/2001 50,000 1 126 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes -------------------------------------------------------------------------------- Receive fixed rate equal to 1.500% and the Fund will pay to the counterparty at par in the event of default of United Mexican States 9.875% due 01/15/2007. Broker: Salomon Brothers, Inc. Exp. 06/13/2002 $ 50,000 $ 8 Receive fixed rate equal to 0.500% and the Fund will pay to the counterparty at par in the event of default of Raytheon Corp. 6.500% due 07/15/2005. Broker: Merrill Lynch Exp. 06/30/2001 25,000 1 ------------- $ (59,395) ------------- (i) Principal amount of the security is adjusted for inflation. (j) Subject to financing transaction. (k) Securities are grouped by coupon or range of coupons and represent a range of maturities. (l) Restricted security. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 127 PIMCO Schedule of Investments A, B, and C Classes Total Return Mortgage Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.2% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (b) 3.625% due 07/15/2002 $ 55 $ 55 ------------- Total U.S. Treasury Obligations 55 (Cost $55) ------------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 123.7% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 48.6% Chase Mortgage Finance Corp. 7.000% due 07/25/2024 477 477 6.550% due 08/25/2028 576 580 6.250% due 12/25/2028 334 304 Citicorp Mortgage Securities, Inc. 6.500% due 05/25/2030 295 293 Countrywide Alternative Loan Trust 6.750% due 08/25/2028 85 85 Countrywide Home Loans 6.750% due 11/25/2027 10 10 6.500% due 03/25/2029 100 96 7.750% due 01/25/2031 249 256 DLJ Mortgage Acceptance Corp. 7.000% due 06/25/2028 138 141 Fannie Mae 6.900% due 08/25/2011 100 101 6.500% due 02/25/2019 725 727 7.750% due 08/25/2022 66 70 7.500% due 03/25/2023 100 106 7.625% due 04/25/2023 (d) 25 25 7.000% due 09/25/2023 17 17 6.750% due 09/25/2023 55 54 6.500% due 09/25/2023 37 37 6.500% due 10/25/2023 217 209 6.500% due 12/25/2023 176 168 7.100% due 12/25/2023 72 72 5.980% due 04/18/2028 (d) 111 111 Freddie Mac 6.000% due 06/15/2008 405 407 4.500% due 03/15/2021 47 45 3.500% due 12/15/2022 10 8 6.500% due 12/15/2023 48 46 6.500% due 03/15/2024 110 107 6.900% due 04/15/2026 946 961 8.000% due 06/15/2026 73 77 6.500% due 05/15/2027 73 71 7.000% due 01/15/2028 433 423 6.000% due 10/15/2028 153 143 General Electric Capital Mortgage Services, Inc. 5.250% due 11/25/2008 1,117 1,119 7.000% due 01/25/2028 100 101 6.750% due 06/25/2028 200 199 Government National Mortgage Association 7.500% due 04/20/2013 1,507 1,507 7.500% due 12/20/2022 70 71 7.000% due 07/16/2026 180 182 Mellon Residential Funding Corp. 6.580% due 07/25/2029 (d) 410 415 Norwest Asset Securities Corp. 6.250% due 09/25/2028 485 464 6.250% due 01/25/2029 167 165 PNC Mortgage Securities Corp. 6.750% due 09/25/2028 1,099 1,093 Residential Accredit Loans, Inc. 7.000% due 01/25/2028 306 308 Superannuation Members Home Loans Global Fund 6.835% due 06/15/2026 (d) 300 300 Vendee Mortgage Trust 7.750% due 05/15/2022 39 41 ------------- 12,192 ------------- Fannie Mae 20.0% 5.500% due 12/01/2030 990 940 5.805% due 10/01/2028 (d) 471 474 6.483% due 11/01/2018 (d) 40 40 6.500% due 04/16/2031 2,500 2,490 7.000% due 05/14/2031 500 505 7.217% due 08/01/2026 (d) 120 124 7.519% due 05/01/2023 (d) 156 161 8.114% due 04/01/2026 (d) 57 58 9.000% due 01/01/2020 215 229 ------------- 5,021 ------------- Federal Housing Administration 6.8% 7.430% due 06/01/2019 1,706 1,702 ------------- Freddie Mac 15.3% 6.000% due 10/01/2024-05/14/2031 (c) 2,645 2,579 6.759% due 02/01/2018 (d) 144 144 7.000% due 05/14/2031 1,000 1,012 7.894% due 11/01/2028 (d) 96 100 ------------- 3,835 ------------- Government National Mortgage Association 32.2% 7.125% due 10/20/2022 (d) 128 132 7.375% due 03/20/2016-03/20/2027 (c)(d) 1,184 1,200 7.500% due 05/15/2027-04/23/2031 (c) 4,616 4,729 7.625% due 12/20/2021-11/20/2026 (c)(d) 218 224 7.750% due 07/20/2022-07/20/2025 (c)(d) 475 487 8.000% due 04/23/2031 1,250 1,290 ------------- 8,062 ------------- Stripped Mortgage-Backed Securities 0.8% Fannie Mae (IO) 6.500% due 07/25/2007 37 1 Fannie Mae (PO) 0.000% due 07/25/2022 264 204 ------------- 205 ------------- Total Mortgage-Backed Securities 31,017 (Cost $30,390) ------------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 1.6% -------------------------------------------------------------------------------- Bayview Financial Acquisition Trust 6.103% due 07/25/2030 (d) 179 179 MLCC Mortgage Investors, Inc. 5.948% due 03/15/2025 (d) 222 222 ------------- Total Asset-Backed Securities 401 (Cost $400) ------------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 0.0% -------------------------------------------------------------------------------- Industrial 0.0% Clear Channel Communications, Inc. 1.500% due 12/01/2002 10 9 ------------- Total Convertible Bonds & Notes 9 (Cost $10) ------------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 22.8% -------------------------------------------------------------------------------- Commercial Paper 22.6% Abbey National North America 5.020% due 08/08/2001 300 295 American Express Credit Corp. 5.620% due 04/06/2001 200 200 Becton Dickinson & Co. 6.110% due 04/25/2001 400 398 Executive Jet, Inc. 5.240% due 06/27/2001 500 494 General Electric Capital Corp. 5.370% due 04/04/2001 100 100 5.020% due 04/25/2001 400 399 Halifax PLC 4.600% due 08/02/2001 700 688 KFW International Finance, Inc. 5.450% due 04/24/2001 300 299 5.010% due 08/08/2001 200 197 National Rural Utilities Cooperative Finance Corp. 4.810% due 05/24/2001 700 696 128 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SBC Communications, Inc. 5.290% due 04/10/2001 $ 500 $ 499 Swedbank, Inc. 5.040% due 08/08/2001 400 393 UBS Finance, Inc. 5.460% due 06/06/2001 600 595 5.340% due 06/06/2001 400 396 ------------- 5,649 ------------- Repurchase Agreement 0.2% State Street Bank 4.600% due 04/02/2001 59 59 (Dated 03/30/2001. Collateralized by Fannie Mae 6.100% due 09/14/2001 valued at $61. Repurchase proceeds are $59.) ------------- Total Short-Term Instruments 5,708 (Cost $5,707) ------------- Total Investments (a) 148.3% $ 37,190 (Cost $36,562) Other Assets and Liabilities (Net) (48.3%) (12,122) ------------- Net Assets 100.0% $ 25,068 ------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $36,560 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 640 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (10) ------------- Unrealized appreciation-net $ 630 ------------- (b) Principal amount of the security is adjusted for inflation. (c) Securities are grouped by coupon or range of coupons and represent a range of maturities. (d) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 129 PIMCO Financial Highlights A, B, and C Classes
Net Asset Net Realized / Value Net Unrealized Gain Total Income Dividends from Beginning of Investment (Loss) on from Investment Net Investment Selected Per Share Data for the Year or Period Ended: Period Income (Loss) Investment Operations Income ---------------------------------------------------------------------------- California Intermediate Municipal Bond Fund Class A 03/31/2001 $ 10.05 $ 0.43 (a) $ 0.57 (a) $ 1.00 $ (0.42) 10/19/1999 - 03/31/2000 9.94 0.18 (a) 0.12 (a) 0.30 (0.17) California Municipal Bond Fund Class A 07/31/2000 - 03/31/2001 $ 10.35 $ 0.27 (a) $ 0.46 (a) $ 0.73 $ (0.30) Convertible Fund Class A 03/31/2001 $ 15.76 $ 0.00 (a) $ (3.45)(a) $ (3.45) $ (0.20) 05/28/1999 - 03/31/2000 10.67 0.00 (a) 5.35 (a) 5.35 (0.03) Class B 03/31/2001 15.68 (0.16)(a) (3.36)(a) (3.52) (0.12) 05/28/1999 - 03/31/2000 10.67 (0.07)(a) 5.29 (a) 5.22 (0.02) Class C 03/31/2001 15.71 (0.15)(a) (3.38)(a) (3.53) (0.11) 05/28/1999 - 03/31/2000 10.67 (0.07)(a) 5.31 (a) 5.24 (0.02) Emerging Markets Bond Fund Class A 03/31/2001 $ 8.61 $ 0.77 (a) $ 0.21 (a) $ 0.98 $ (0.79) 03/31/2000 7.51 0.84 (a) 1.10 (a) 1.94 (0.84) 03/31/1999 9.67 0.83 (a) (2.11)(a) (1.28) (0.83) 07/31/1997 - 03/31/1998 10.00 0.44 (a) (0.18)(a) 0.26 (0.44) Class B 03/31/2001 8.61 0.73 (a) 0.19 (a) 0.92 (0.73) 03/31/2000 7.51 0.77 (a) 1.11 (a) 1.88 (0.78) 03/31/1999 9.67 0.77 (a) (2.11)(a) (1.34) (0.77) 07/31/1997 - 03/31/1998 10.00 0.40 (a) (0.20)(a) 0.20 (0.38) Class C 03/31/2001 8.61 0.72 (a) 0.21 (a) 0.93 (0.74) 03/31/2000 7.51 0.78 (a) 1.10 (a) 1.88 (0.78) 03/31/1999 9.67 0.77 (a) (2.11)(a) (1.34) (0.77) 07/31/1997 - 03/31/1998 10.00 0.38 (a) (0.18)(a) 0.20 (0.38) Foreign Bond Fund Class A 03/31/2001 $ 10.03 $ 0.54 (a) $ 0.50 (a) $ 1.04 $ (0.54) 03/31/2000 10.63 0.59 (a) (0.45)(a) 0.14 (0.59) 03/31/1999 10.74 0.53 (a) 0.24 (a) 0.77 (0.53) 03/31/1998 10.41 0.61 (a) 0.62 (a) 1.23 (0.59) 01/20/1997 - 03/31/1997 10.59 0.59 (0.72) (0.13) (0.05) Class B 03/31/2001 10.03 0.46 (a) 0.50 (a) 0.96 (0.46) 03/31/2000 10.63 0.51 (a) (0.45)(a) 0.06 (0.51) 03/31/1999 10.74 0.46 (a) 0.24 (a) 0.70 (0.46) 03/31/1998 10.41 0.53 (a) 0.61 (a) 1.14 (0.50) 01/20/1997 - 03/31/1997 10.59 0.58 (0.72) (0.14) (0.04) Class C 03/31/2001 10.03 0.46 (a) 0.50 (a) 0.96 (0.46) 03/31/2000 10.63 0.51 (a) (0.45)(a) 0.06 (0.51) 03/31/1999 10.74 0.45 (a) 0.24 (a) 0.69 (0.45) 03/31/1998 10.41 0.52 (a) 0.62 (a) 1.14 (0.50) 01/20/1997 - 03/31/1997 10.59 0.58 (0.72) (0.14) (0.04)
+ Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 2.43%. (c) Ratio of expenses to average net assets excluding interest expense is 1.70%. (d) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 1.08%. (e) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 1.83%. 130 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Dividends in Distributions Distributions in Ratio of Excess of Net from Net Excess of Net Expenses to Investment Realized Capital Realized Capital Total Net Asset Value Net Assets End Average Net Income Gains Gains Distributions End of Period Total Return of Period (000s) Assets ----------------------------------------------------------------------------------------------------------------------------------- $ 0.00 $ (0.03) $ 0.00 $ (0.45) $ 10.60 10.19% $ 29,035 0.86% 0.00 (0.02) 0.00 (0.19) 10.05 2.94 1,793 0.85+(f) $ 0.00 $ (0.43) $ 0.00 $ (0.73) $ 10.35 7.72% $ 706 0.85%+(b) $ 0.00 $ 0.00 $ (0.70) $ (0.90) $ 11.41 (22.68)% $ 6,426 1.06% (0.14) (0.09) 0.00 (0.26) 15.76 50.36 5,327 1.05+(d) 0.00 0.00 (0.70) (0.82) 11.34 (23.24) 5,705 1.81 (0.10) (0.09) 0.00 (0.21) 15.68 49.18 2,437 1.80+(e) 0.00 0.00 (0.70) (0.81) 11.37 (23.21) 13,249 1.80 (0.09) (0.09) 0.00 (0.20) 15.71 49.33 7,924 1.80+(e) $ 0.00 $ 0.00 $ (0.40) $ (1.19) $ 8.40 12.46% $ 1,143 1.34%(g) 0.00 0.00 0.00 (0.84) 8.61 27.39 316 1.29 0.00 0.00 (0.05) (0.88) 7.51 (12.90) 172 1.25 0.00 (0.15) 0.00 (0.59) 9.67 2.84 317 1.26+ 0.00 0.00 (0.40) (1.13) 8.40 11.59 1,620 2.09 (h) 0.00 0.00 0.00 (0.78) 8.61 26.43 1,168 2.04 0.00 0.00 (0.05) (0.82) 7.51 (13.58) 398 2.00 0.00 (0.15) 0.00 (0.53) 9.67 2.29 304 2.01+ 0.00 0.00 (0.40) (1.14) 8.40 11.74 792 2.08 (i) 0.00 0.00 0.00 (0.78) 8.61 26.49 249 2.04 0.00 0.00 (0.05) (0.82) 7.51 (13.57) 229 2.00 0.00 (0.15) 0.00 (0.53) 9.67 2.29 136 2.01+ $ 0.00 $ 0.00 $ (0.21) $ (0.75) $ 10.32 10.82% $ 84,631 0.99% 0.00 (0.15) 0.00 (0.74) 10.03 1.50 54,299 1.19 0.00 (0.10) (0.25) (0.88) 10.63 7.43 29,009 0.95 0.00 (0.31) 0.00 (0.90) 10.74 12.14 9,582 0.95 0.00 0.00 0.00 (0.05) 10.41 (1.21) 704 0.97+ 0.00 0.00 (0.21) (0.67) 10.32 9.94 28,747 1.74 0.00 (0.15) 0.00 (0.66) 10.03 0.72 24,402 1.91 (c) 0.00 (0.10) (0.25) (0.81) 10.63 6.69 21,256 1.70 0.00 (0.31) 0.00 (0.81) 10.74 11.29 10,631 1.70 0.00 0.00 0.00 (0.04) 10.41 (1.34) 1,221 1.75+ 0.00 0.00 (0.21) (0.67) 10.32 9.96 35,337 1.74 0.00 (0.15) 0.00 (0.66) 10.03 0.73 30,214 1.91 (c) 0.00 (0.10) (0.25) (0.80) 10.63 6.63 29,584 1.70 0.00 (0.31) 0.00 (0.81) 10.74 11.29 17,080 1.70 0.00 0.00 0.00 (0.04) 10.41 (1.32) 1,788 1.76+ Ratio of Net Investment Income (Loss) to Average Portfolio Net Assets Turnover Rate ---------------------------------- 4.19% 257% 3.96+ 357 3.89%+ 338% (0.35)% 225% 0.15+ 247 (1.13) 225 (0.58)+ 247 (1.11) 225 (0.59)+ 247 9.08% 902% 10.59 328 10.26 315 6.93+ 695 8.58 902 9.57 328 9.68 315 6.33+ 695 8.52 902 9.87 328 9.79 315 6.11+ 695 5.28% 417% 5.75 330 4.87 376 5.88 280 4.95+ 984 4.57 417 5.00 330 4.14 376 5.13 280 3.73+ 984 4.57 417 5.01 330 4.16 376 5.13 280 4.09+ 984
(f) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 1.63%. (g) Ratio of expenses to average net assets excluding interest expense is 1.26%. (h) Ratio of expenses to average net assets excluding interest expense is 2.01%. (i) Ratio of expenses to average net assets excluding interest expense is 2.00%. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 131 PIMCO Financial Highlights A, B, and C Classes (Cont.)
Net Asset Net Realized / Value Net Unrealized Gain Total Income Dividends from Beginning of Investment (Loss) on from Investment Net Investment Selected Per Share Data for the Year or Period Ended: Period Income (Loss) Investment Operations Income ------------------------------------------------------------------------------------------------------------------------------------ Global Bond Fund II Class A 03/31/2001 $ 9.41 $ 0.52 (a) $ 0.50 (a) $ 1.02 $ (0.52) 03/31/2000 9.89 0.52 (a) (0.46)(a) 0.06 (0.51) 03/31/1999 9.92 0.48 (a) 0.06 (a) 0.54 (0.48) 03/31/1998 10.84 0.64 (a) 0.51 (a) 1.15 0.00 10/01/1996 - 03/31/1997 10.96 0.66 (0.16) 0.50 (0.22) 09/30/1996 10.00 0.32 (b) 0.95 1.27 (0.31) Class B 03/31/2001 9.41 0.45 (a) 0.50 (a) 0.95 (0.45) 03/31/2000 9.89 0.45 (a) (0.46)(a) (0.01) (0.44) 03/31/1999 9.92 0.41 (a) 0.06 (a) 0.47 (0.41) 03/31/1998 10.84 0.66 (a) 0.41 (a) 1.07 0.00 10/01/1996 - 03/31/1997 10.96 0.62 (0.16) 0.46 (0.18) 09/30/1996 10.00 0.30 (b) 0.92 1.22 (0.26) Class C 03/31/2001 9.41 0.45 (a) 0.50 (a) 0.95 (0.45) 03/31/2000 9.89 0.45 (a) (0.46)(a) (0.01) (0.44) 03/31/1999 9.92 0.41 (a) 0.06 (a) 0.47 (0.41) 03/31/1998 10.84 0.55 (a) 0.52 (a) 1.07 0.00 10/01/1996 - 03/31/1997 10.96 0.62 (0.16) 0.46 (0.18) 09/30/1996 10.00 0.30 (b) 0.92 1.22 (0.26) High Yield Fund Class A 03/31/2001 $ 10.22 $ 0.87 (a) $ (0.34)(a) $ 0.53 $ (0.86) 03/31/2000 11.23 0.89 (a) (1.01)(a) (0.12) (0.88) 03/31/1999 11.66 0.91 (a) (0.43)(a) 0.48 (0.90) 03/31/1998 11.10 0.93 (a) 0.66 (a) 1.59 (0.94) 01/13/1997 - 03/31/1997 11.18 0.17 (0.05) 0.12 (0.20) Class B 03/31/2001 10.22 0.79 (a) (0.33)(a) 0.46 (0.79) 03/31/2000 11.23 0.81 (a) (1.01)(a) (0.20) (0.80) 03/31/1999 11.66 0.82 (a) (0.43)(a) 0.39 (0.81) 03/31/1998 11.10 0.84 (a) 0.66 (a) 1.50 (0.85) 01/13/1997 - 03/31/1997 11.18 0.15 (0.05) 0.10 (0.18) Class C 03/31/2001 10.22 0.79 (a) (0.33)(a) 0.46 (0.79) 03/31/2000 11.23 0.81 (a) (1.01)(a) (0.20) (0.80) 03/31/1999 11.66 0.82 (a) (0.43)(a) 0.39 (0.81) 03/31/1998 11.10 0.85 (a) 0.65 (a) 1.50 (0.85) 01/13/1997 - 03/31/1997 11.18 0.15 (0.05) 0.10 (0.18)
+ Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) Reflects voluntary waiver of investments advisory fee of $12,041 (0.01 per share) by the Advisor. (c) Ratio of expenses to average net assets without the waiver would have been 1.57%. (d) Ratio of net investment income to average net assets without the waiver would have been 4.58%. 132 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Dividends in Distributions Distributions in Ratio of Excess of Net from Net Excess of Net Expenses to Investment Realized Capital Realized Capital Total Net Asset Value Net Assets End Average Net Income Gains Gains Distributions End of Period Total Return of Period (000s) Assets ----------------------------------------------------------------------------------------------------------------------------------- $ 0.00 $ (0.08) $ (0.22) $ (0.82) $ 9.61 11.43% $ 2,747 0.98% (0.01) (0.02) 0.00 (0.54) 9.41 0.71 2,279 0.98 0.00 (0.01) (0.08) (0.57) 9.89 5.65 2,728 0.95 (0.54) (1.53) 0.00 (2.07) 9.92 11.21 6,816 0.95 0.00 (0.40) 0.00 (0.62) 10.84 4.55 7,652 2.05+ 0.00 0.00 0.00 (0.31) 10.96 15.01 7,360 1.27 (c) 0.00 (0.08) (0.22) (0.75) 9.61 10.60 5,243 1.73 (0.01) (0.02) 0.00 (0.47) 9.41 (0.05) 4,590 1.73 0.00 (0.01) (0.08) (0.50) 9.89 4.85 4,909 1.70 (0.46) (1.53) 0.00 (1.99) 9.92 10.39 4,473 1.70 0.00 (0.40) 0.00 (0.58) 10.84 4.17 3,925 2.57+ 0.00 0.00 0.00 (0.26) 10.96 14.54 3,240 2.49 (c) 0.00 (0.08) (0.22) (0.75) 9.61 10.60 5,208 1.73 (0.01) (0.02) 0.00 (0.47) 9.41 (0.05) 5,254 1.73 0.00 (0.01) (0.08) (0.50) 9.89 4.82 5,863 1.70 (0.46) (1.53) 0.00 (1.99) 9.92 10.39 6,096 1.70 0.00 (0.40) 0.00 (0.58) 10.84 4.17 5,323 2.43+ 0.00 0.00 0.00 (0.26) 10.96 14.54 3,459 2.49 (c) $ (0.01) $ 0.00 $ 0.00 $ (0.87) $ 9.88 5.44% $ 262,572 0.90% (0.01) 0.00 0.00 (0.89) 10.22 (1.15) 187,039 0.90 (0.01) 0.00 0.00 (0.91) 11.23 4.32 155,466 0.90 0.00 0.00 (0.09) (1.03) 11.66 14.80 70,858 0.90 0.00 0.00 0.00 (0.20) 11.10 1.06 28,873 0.92+ (0.01) 0.00 0.00 (0.80) 9.88 4.66 327,367 1.65 (0.01) 0.00 0.00 (0.81) 10.22 (1.89) 303,333 1.65 (0.01) 0.00 0.00 (0.82) 11.23 3.54 286,198 1.65 0.00 0.00 (0.09) (0.94) 11.66 13.94 156,099 1.65 0.00 0.00 0.00 (0.18) 11.10 0.86 60,269 1.67+ (0.01) 0.00 0.00 (0.80) 9.88 4.66 373,530 1.65 (0.01) 0.00 0.00 (0.81) 10.22 (1.89) 341,953 1.65 (0.01) 0.00 0.00 (0.82) 11.23 3.55 370,861 1.65 0.00 0.00 (0.09) (0.94) 11.66 13.95 284,836 1.65 0.00 0.00 0.00 (0.18) 11.10 0.88 205,297 1.68+ Ratio of Net Investment Income (Loss) to Average Portfolio Net Assets Turnover Rate ---------------------------------- 5.46% 422% 5.45 290 5.07 236 5.88 369 5.60+ 307 4.88 (d) 1,246 4.73 422 4.72 290 4.16 236 5.12 369 4.22+ 307 4.09 (d) 1,246 4.75 422 4.71 290 4.16 236 5.12 369 4.14+ 307 4.09 (d) 1,246 8.62% 53% 8.23 39 7.94 39 8.02 37 8.28+ 67 7.90 53 7.48 39 7.21 39 7.27 37 7.52+ 67 7.90 53 7.49 39 7.24 39 7.36 37 7.56+ 67
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 133 PIMCO Financial Highlights A, B, and C Classes (Cont.)
Net Asset Net Realized/ Value Net Unrealized Gain Total Income Dividends from Beginning of Investment (Loss) on from Investment Net Investment Selected Per Share Data for the Year or Period Ended: Period Income (Loss) Investments Operations Income ------------------------------------------------------------------------------------------------------------------------------------ Long-Term U.S. Government Fund Class A 03/31/2001 $ 9.79 $ 0.34 (a) $ 1.09 (a) $ 1.43 $ (0.57) 03/31/2000 10.30 0.58 (a) (0.51)(a) 0.07 (0.58) 03/31/1999 10.57 0.59 (a) 0.20 (a) 0.79 (0.60) 03/31/1998 9.39 0.48 (a) 1.34 (a) 1.82 (0.58) 01/20/1997 - 03/31/1997 9.67 0.32 (0.47) (0.15) (0.13) Class B 03/31/2001 9.79 0.65 (a) 0.71 (a) 1.36 (0.50) 03/31/2000 10.30 0.50 (a) (0.50)(a) (0.00) (0.51) 03/31/1999 10.57 0.51 (a) 0.20 (a) 0.71 (0.52) 03/31/1998 9.39 0.39 (a) 1.35 (a) 1.74 (0.50) 01/20/1997 - 03/31/1997 9.67 0.29 (0.47) (0.18) (0.10) Class C 03/31/2001 9.79 0.92 (a) 0.44 (a) 1.36 (0.50) 03/31/2000 10.30 0.51 (a) (0.51)(a) (0.00) (0.51) 03/31/1999 10.57 0.50 (a) 0.21 (a) 0.71 (0.52) 03/31/1998 9.39 0.39 (a) 1.35 (a) 1.74 (0.50) 01/20/1997 - 03/31/1997 9.67 0.29 (0.47) (0.18) (0.10) Low Duration Fund Class A 03/31/2001 $ 9.81 $ 0.60 (a) $ 0.25 (a) $ 0.85 $ (0.61) 03/31/2000 10.10 0.59 (a) (0.29)(a) 0.30 (0.58) 03/31/1999 10.18 0.60 (a) (0.02)(a) 0.58 (0.60) 03/31/1998 9.98 0.60 (a) 0.23 (a) 0.83 (0.58) 01/13/1997 - 03/31/1997 10.02 0.12 (0.03) 0.09 (0.12) Class B 03/31/2001 9.81 0.53 (a) 0.24 (a) 0.77 (0.53) 03/31/2000 10.10 0.51 (a) (0.29)(a) 0.22 (0.50) 03/31/1999 10.18 0.52 (a) (0.02)(a) 0.50 (0.52) 03/31/1998 9.98 0.53 (a) 0.22 (a) 0.75 (0.50) 01/13/1997 - 03/31/1997 10.02 0.10 (0.03) 0.07 (0.11) Class C 03/31/2001 9.81 0.55 (a) 0.25 (a) 0.80 (0.56) 03/31/2000 10.10 0.54 (a) (0.29)(a) 0.25 (0.53) 03/31/1999 10.18 0.55 (a) (0.02)(a) 0.53 (0.55) 03/31/1998 9.98 0.55 (a) 0.23 (a) 0.78 (0.53) 01/13/1997 - 03/31/1997 10.02 0.11 (0.03) 0.08 (0.11) Money Market Fund Class A 03/31/2001 $ 1.00 $ 0.06 (a) $ 0.00 (a) $ 0.06 $ (0.06) 03/31/2000 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 03/31/1999 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 03/31/1998 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 01/13/1997 - 03/31/1997 1.00 0.01 0.00 0.01 (0.01) Class B 03/31/2001 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 03/31/2000 1.00 0.04 (a) 0.00 (a) 0.04 (0.04) 03/31/1999 1.00 0.04 (a) 0.00 (a) 0.04 (0.04) 03/31/1998 1.00 0.04 (a) 0.00 (a) 0.04 (0.04) 01/13/1997 - 03/31/1997 1.00 0.01 0.00 0.01 (0.01) Class C 03/31/2001 1.00 0.06 (a) 0.00 (a) 0.06 (0.06) 03/31/2000 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 03/31/1999 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 03/31/1998 1.00 0.05 (a) 0.00 (a) 0.05 (0.05) 01/13/1997 - 03/31/1997 1.00 0.01 0.00 0.01 (0.01)
+ Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) Ratio of expenses to average net assets excluding interest expense is 1.65%. 134 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Dividends in Distributions Distributions in Ratio of Excess of Net from Net Excess of Net Expenses to Investment Realized Capital Realized Capital Total Net Asset Value Net Assets End Average Net Income Gains Gains Distributions End of Period Total Return of Period (000s) Assets ----------------------------------------------------------------------------------------------------------------------------------- $ 0.00 $ 0.00 $ 0.00 $ (0.57) $ 10.65 15.07% $ 79,477 0.97% 0.00 0.00 0.00 (0.58) 9.79 0.86 42,773 0.99 (d) 0.00 0.00 (0.46) (1.06) 10.30 7.34 29,809 1.34 (d) 0.00 (0.06) 0.00 (0.64) 10.57 19.78 6,161 0.91 0.00 0.00 0.00 (0.13) 9.39 (1.72) 1,204 1.12+ 0.00 0.00 0.00 (0.50) 10.65 14.22 54,374 1.70 0.00 0.00 0.00 (0.51) 9.79 0.11 34,301 1.72 (b) 0.00 0.00 (0.46) (0.98) 10.30 6.51 37,946 2.13 (b) 0.00 (0.06) 0.00 (0.56) 10.57 18.85 7,516 1.66 0.00 0.00 0.00 (0.10) 9.39 (1.92) 454 1.87+ 0.00 0.00 0.00 (0.50) 10.65 14.24 35,675 1.71 0.00 0.00 0.00 (0.51) 9.79 0.11 20,955 1.71 (b) 0.00 0.00 (0.46) (0.98) 10.30 6.52 31,653 2.16 (b) 0.00 (0.06) 0.00 (0.56) 10.57 18.86 7,258 1.66 0.00 0.00 0.00 (0.10) 9.39 (1.83) 275 1.88+ $ (0.02) $ 0.00 $ 0.00 $ (0.63) $ 10.03 8.93% $ 273,994 0.96%(d) (0.01) 0.00 0.00 (0.59) 9.81 3.07 235,413 0.98 (d) 0.00 (0.01) (0.05) (0.66) 10.10 5.86 191,727 0.90 (0.02) (0.03) 0.00 (0.63) 10.18 8.49 109,531 0.90 (0.01) 0.00 0.00 (0.13) 9.98 0.85 59,348 0.91+ (0.02) 0.00 0.00 (0.55) 10.03 8.12% 88,585 1.71 (b) (0.01) 0.00 0.00 (0.51) 9.81 2.30 73,121 1.73 (b) 0.00 (0.01) (0.05) (0.58) 10.10 5.07 65,160 1.65 (0.02) (0.03) 0.00 (0.55) 10.18 7.68 17,624 1.65 0.00 0.00 0.00 (0.11) 9.98 0.68 5,296 1.67+ (0.02) 0.00 0.00 (0.58) 10.03 8.39% 119,062 1.46 (c) (0.01) 0.00 0.00 (0.54) 9.81 2.55 110,447 1.48 (c) 0.00 (0.01) (0.05) (0.61) 10.10 5.33 112,229 1.40 (0.02) (0.03) 0.00 (0.58) 10.18 8.01 68,766 1.40 (0.01) 0.00 0.00 (0.12) 9.98 0.75 63,606 1.42+ $ 0.00 $ 0.00 $ 0.00 $ (0.06) $ 1.00 5.94% $ 58,940 0.60% 0.00 0.00 0.00 (0.05) 1.00 4.92 101,734 0.60 0.00 0.00 0.00 (0.05) 1.00 4.76 105,200 0.60 0.00 0.00 0.00 (0.05) 1.00 5.10 41,375 0.60 0.00 0.00 0.00 (0.01) 1.00 1.01 43,589 0.57+ 0.00 0.00 0.00 (0.05) 1.00 5.02 38,286 1.50 0.00 0.00 0.00 (0.04) 1.00 3.99 25,507 1.50 0.00 0.00 0.00 (0.04) 1.00 4.03 14,968 1.50 0.00 0.00 0.00 (0.04) 1.00 4.21 2,937 1.50 0.00 0.00 0.00 (0.01) 1.00 0.83 3,143 1.41+ 0.00 0.00 0.00 (0.06) 1.00 5.94 108,549 0.60 0.00 0.00 0.00 (0.05) 1.00 4.95 99,475 0.60 0.00 0.00 0.00 (0.05) 1.00 4.85 86,159 0.60 0.00 0.00 0.00 (0.05) 1.00 5.14 55,696 0.60 0.00 0.00 0.00 (0.01) 1.00 1.02 85,398 0.58+ Ratio of Net Investment Income (Loss) to Average Portfolio Net Assets Turnover Rate ---------------------------------- 3.36% 1046% 5.96 320 5.33 364 4.49 177 6.91+ 402 6.40 1046 5.16 320 4.53 364 4.64 177 4.95+ 402 9.01 1046 5.16 320 4.50 364 4.64 177 5.52+ 402 6.07% 348% 5.91 82 5.85 245 5.93 309 5.84+ 240 5.32 348 5.16 82 5.03 245 5.16 309 5.03+ 240 5.58 348 5.42 82 5.35 245 5.46 309 5.36+ 240 5.85% N/A 4.90 N/A 4.78 N/A 5.02 N/A 4.44+ N/A 4.87 N/A 4.05 N/A 3.79 N/A 4.15 N/A 3.62+ N/A 5.77 N/A 4.78 N/A 4.79 N/A 5.05 N/A 4.47+ N/A
(c) Ratio of expenses to average net assets excluding interest expense is 1.40%. (d) Ratio of expenses to average net assets excluding interest expense is 0.90%. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 135 PIMCO Financial Highlights A, B, and C Classes (Cont.)
Net Asset Net Realized/ Value Net Unrealized Gain Total Income Dividends from Beginning of Investment (Loss) on from Investment Net Investment Selected Per Share Data for the Year or Period Ended: Period Income (Loss) Investment Operations Income ------------------------------------------------------------------------------------------------------------------------------------ Municipal Bond Fund Class A 03/31/2001 $ 9.47 $ 0.44 (a) $ 0.55 (a) $ 0.99 $ (0.44) 03/31/2000 10.12 0.43 (a) (0.65)(a) (0.22) (0.43) 03/31/1999 9.97 0.41 (a) 0.15 (a) 0.56 (0.41) Class B 03/31/2001 9.47 0.37 (a) 0.55 (a) 0.92 (0.37) 03/31/2000 10.12 0.36 (a) (0.65)(a) (0.29) (0.36) 03/31/1999 9.97 0.34 (a) 0.14 (a) 0.48 (0.33) Class C 03/31/2001 9.47 0.39 (a) 0.55 (a) 0.94 (0.39) 03/31/2000 10.12 0.38 (a) (0.65)(a) (0.27) (0.38) 03/31/1999 9.97 0.36 (a) 0.15 (a) 0.51 (0.36) New York Municipal Bond Fund Class A 03/31/2001 $ 9.94 $ 0.43 (a) $ 0.77 (a) $ 1.20 $ (0.41) 10/19/1999 - 03/31/2000 9.90 0.16 (a) 0.07 (a) 0.23 (0.17) Real Return Bond Fund Class A 03/31/2001 $ 9.92 $ 0.71 (a) $ 0.61 (a) $ 1.32 $ (0.76) 03/31/2000 9.83 0.64 (a) 0.11 (a) 0.75 (0.64) 03/31/1999 9.77 0.43 (a) 0.14 (a) 0.57 (0.45) 03/31/1998 9.93 0.40 (a) 0.03 (a) 0.43 (0.42) 01/29/1997 - 03/31/1997 10.00 0.11 (a) (0.10)(a) 0.01 (0.08) Class B 03/31/2001 9.92 0.64 (a) 0.60 (a) 1.24 (0.68) 03/31/2000 9.83 0.57 (a) 0.11 (a) 0.68 (0.57) 03/31/1999 9.77 0.37 (a) 0.12 (a) 0.49 (0.38) 03/31/1998 9.93 0.33 (a) 0.03 (a) 0.36 (0.36) 01/29/1997 - 03/31/1997 10.00 0.09 (0.10) (0.01) (0.06) Class C 03/31/2001 9.92 0.68 (a) 0.59 (a) 1.27 (0.71) 03/31/2000 9.83 0.58 (a) 0.12 (a) 0.70 (0.59) 03/31/1999 9.77 0.44 (a) 0.08 (a) 0.52 (0.40) 03/31/1998 9.93 0.35 (a) 0.04 (a) 0.39 (0.38) 01/29/1997 - 03/31/1997 10.00 0.09 (0.10) (0.01) (0.06) Short-Term Fund Class A 03/31/2001 $ 9.95 $ 0.60 (a) $ 0.10 (a) $ 0.70 $ (0.60) 03/31/2000 10.03 0.55 (a) (0.09)(a) 0.46 (0.54) 03/31/1999 10.06 0.53 (a) (0.02)(a) 0.51 (0.53) 03/31/1998 10.00 0.55 (a) 0.09 (a) 0.64 (0.56) 01/20/1997 - 03/31/1997 10.04 0.10 (0.03) 0.07 (0.10) Class B 03/31/2001 9.95 0.53 (a) 0.10 (a) 0.63 (0.53) 03/31/2000 10.03 0.48 (a) (0.09)(a) 0.39 (0.47) 03/31/1999 10.06 0.45 (a) (0.02)(a) 0.43 (0.45) 03/31/1998 10.00 0.50 (a) 0.08 (a) 0.58 (0.50) 01/20/1997 - 03/31/1997 10.04 0.09 (0.03) 0.06 (0.10) Class C 03/31/2001 9.95 0.57 (a) 0.10 (a) 0.67 (0.57) 03/31/2000 10.03 0.52 (a) (0.09)(a) 0.43 (0.51) 03/31/1999 10.06 0.50 (a) (0.02)(a) 0.48 (0.50) 03/31/1998 10.00 0.54 (a) 0.07 (a) 0.61 (0.53) 01/20/1997 - 03/31/1997 10.04 0.09 (0.03) 0.06 (0.10)
+ Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) Ratio of expenses to average net assets excluding interest expense is 0.85%. 136 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Dividends in Distributions Distributions in Ratio of Excess of Net from Net Excess of Net Expenses to Investment Realized Capital Realized Capital Total Net Asset Value Net Assets End Average Net Income Gains Gains Distributions End of Period Total Return of Period (000s) Assets ----------------------------------------------------------------------------------------------------------------------------------- $ 0.00 $ 0.00 $ 0.00 $ (0.44) $ 10.02 10.74% $ 11,381 0.85% 0.00 0.00 0.00 (0.43) 9.47 (2.16) 8,666 0.85 0.00 0.00 0.00 (0.41) 10.12 5.67 7,020 0.86 0.00 0.00 0.00 (0.37) 10.02 9.92 8,513 1.60 0.00 0.00 0.00 (0.36) 9.47 (2.89) 5,314 1.60 0.00 0.00 0.00 (0.33) 10.12 4.88 6,070 1.61 0.00 0.00 0.00 (0.39) 10.02 10.20 30,539 1.35 0.00 0.00 0.00 (0.38) 9.47 (2.64) 28,674 1.35 0.00 0.00 0.00 (0.36) 10.12 5.13 37,913 1.35 $ 0.00 $ (0.09) $ 0.00 $ (0.50) $ 10.64 12.38% $ 186 0.86% 0.00 (0.02) 0.00 (0.19) 9.94 2.30 10 0.89+(e) $ 0.00 $ (0.08) $ 0.00 $ (0.84) $ 10.40 13.97% $ 95,899 0.94% 0.00 (0.02) 0.00 (0.66) 9.92 7.93 17,676 0.93 (0.06) 0.00 0.00 (0.51) 9.83 5.99 6,250 0.92 (0.03) (0.14) 0.00 (0.59) 9.77 4.12 370 0.92 0.00 0.00 0.00 (0.08) 9.93 0.15 1 0.90+ 0.00 (0.08) 0.00 (0.76) 10.40 13.12 54,875 1.69 0.00 (0.02) 0.00 (0.59) 9.92 7.16 11,463 1.68 (0.05) 0.00 0.00 (0.43) 9.83 5.19 3,646 1.68 (0.02) (0.14) 0.00 (0.52) 9.77 3.50 1,496 1.67 0.00 0.00 0.00 (0.06) 9.93 (0.08) 509 1.59+ 0.00 (0.08) 0.00 (0.79) 10.40 13.42 81,407 1.44 0.00 (0.02) 0.00 (0.61) 9.92 7.40 17,336 1.43 (0.06) 0.00 0.00 (0.46) 9.83 5.46 2,534 1.43 (0.03) (0.14) 0.00 (0.55) 9.77 3.73 490 1.42 0.00 0.00 0.00 (0.06) 9.93 (0.07) 148 1.62+ $ 0.00 $ 0.00 $ (0.02) $ (0.62) $ 10.03 7.23% $ 84,342 1.41%(b) 0.00 0.00 0.00 (0.54) 9.95 4.76 75,671 1.03 (b) 0.00 0.00 (0.01) (0.54) 10.03 5.21 80,787 0.85 (0.01) (0.01) 0.00 (0.58) 10.06 6.64 24,182 0.85 (0.01) 0.00 0.00 (0.11) 10.00 0.66 2,533 0.86+ 0.00 0.00 (0.02) (0.55) 10.03 6.44 6,954 2.15 (c) 0.00 0.00 0.00 (0.47) 9.95 4.00 6,694 1.80 (c) 0.00 0.00 (0.01) (0.46) 10.03 4.43 3,813 1.60 (0.01) (0.01) 0.00 (0.52) 10.06 5.96 1,258 1.60 0.00 0.00 0.00 (0.10) 10.00 0.58 114 1.62+ 0.00 0.00 (0.02) (0.59) 10.03 6.91 23,961 1.70 (d) 0.00 0.00 0.00 (0.51) 9.95 4.45 18,935 1.34 (d) 0.00 0.00 (0.01) (0.51) 10.03 4.91 15,589 1.15 (0.01) (0.01) 0.00 (0.55) 10.06 6.33 6,763 1.15 0.00 0.00 0.00 (0.10) 10.00 0.63 1,359 1.14+ Ratio of Net Investment Income (Loss) to Average Portfolio Net Assets Turnover Rate ---------------------------------- 4.52% 306% 4.44 145 4.10 70 3.79 306 3.69 145 3.33 70 4.06 306 3.94 145 3.60 70 4.15% 973% 3.68+ 270 7.03% 202% 6.57 253 4.40 438 4.06 967 6.14+ 160 6.33 202 5.82 253 3.72 438 3.32 967 3.43+ 160 6.69 202 5.90 253 4.49 438 3.56 967 5.13+ 160 6.03% 121% 5.45 38 5.15 47 5.48 48 5.07+ 77 5.28 121 4.77 38 4.45 47 4.97 48 4.83+ 77 5.72 121 5.17 38 4.92 47 5.33 48 4.78+ 77
(c) Ratio of expenses to average net assets excluding interest expense is 1.60%. (d) Ratio of expenses to average net assets excluding interest expense is 1.15%. (e) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 1.88%. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 137 PIMCO Financial Highlights A, B, and C Classes (Cont.)
Net Asset Net Realized/ Value Net Unrealized Gain Total Income Dividends from Beginning of Investment (Loss) on from Investment Net Investment Selected Per Share Data for the Year or Period Ended: Period Income (Loss) Investment Operations Income ------------------------------------------------------------------------------------------------------------------------------------ StocksPLUS Fund Class A 03/31/2001 $ 14.06 $ (0.01)(a) $ (2.80)(a) $ (2.81) $ (0.24) 03/31/2000 14.26 1.05 (a) 1.27 (a) 2.32 (1.04) 03/31/1999 14.06 0.93 (a) 1.29 (a) 2.22 (0.78) 03/31/1998 11.46 1.66 (a) 3.41 (a) 5.07 (1.38) 01/20/1997 - 03/31/1997 11.91 (0.10) (0.20) (0.30) (0.15) Class B 03/31/2001 13.96 (0.09)(a) (2.79)(a) (2.88) (0.19) 03/31/2000 14.18 0.90 (a) 1.30 (a) 2.20 (0.94) 03/31/1999 14.01 0.84 (a) 1.26 (a) 2.10 (0.69) 03/31/1998 11.44 1.61 (a) 3.35 (a) 4.96 (1.30) 01/20/1997 - 03/31/1997 11.91 (0.13) (0.20) (0.33) (0.14) Class C 03/31/2001 14.00 (0.07)(a) (2.79)(a) (2.86) (0.20) 03/31/2000 14.21 0.94 (a) 1.30 (a) 2.24 (0.97) 03/31/1999 14.03 0.86 (a) 1.28 (a) 2.14 (0.72) 03/31/1998 11.45 1.64 (a) 3.35 (a) 4.99 (1.32) 01/20/1997 - 03/31/1997 11.91 (0.12)(a) (0.20)(a) (0.32) (0.14) Strategic Balanced Fund Class A 03/31/2001 $ 12.74 $ 0.89 (a) $ (1.90)(a) $ (1.01) $ (0.62) 05/28/1999 -03/31/2000 12.80 0.64 (a) 0.48 (a) 1.12 (0.72) Class B 03/31/2001 12.72 0.81 (a) (1.90)(a) (1.09) (0.54) 05/28/1999 -03/31/2000 12.80 0.60 (a) 0.45 (a) 1.05 (0.67) Class C 03/31/2001 12.70 0.82 (a) (1.92)(a) (1.10) (0.54) 05/28/1999 -03/31/2000 12.80 0.61 (a) 0.42 (a) 1.03 (0.67) Total Return Fund Class A 03/31/2001 $ 9.96 $ 0.62 (a) $ 0.56 (a) $ 1.18 $ (0.60) 03/31/2000 10.36 0.58 (a) (0.40)(a) 0.18 (0.56) 03/31/1999 10.62 0.58 (a) 0.16 (a) 0.74 (0.58) 03/31/1998 10.27 0.58 (a) 0.63 (a) 1.21 (0.57) 01/13/1997 - 03/31/1997 10.40 0.12 (0.12) 0.00 (0.13) Class B 03/31/2001 9.96 0.54 (a) 0.57 (a) 1.11 (0.54) 03/31/2000 10.36 0.51 (a) (0.41)(a) 0.10 (0.48) 03/31/1999 10.62 0.50 (a) 0.16 (a) 0.66 (0.50) 03/31/1998 10.27 0.50 (a) 0.63 (a) 1.13 (0.50) 01/13/1997 - 03/31/1997 10.40 0.11 (0.12) (0.01) (0.12) Class C 03/31/2001 9.96 0.54 (a) 0.57 (a) 1.11 (0.54) 03/31/2000 10.36 0.51 (a) (0.41)(a) 0.10 (0.48) 03/31/1999 10.62 0.50 (a) 0.16 (a) 0.66 (0.50) 03/31/1998 10.27 0.51 (a) 0.63 (a) 1.14 (0.51) 01/13/1997 - 03/31/1997 10.40 0.11 (0.12) (0.01) (0.12) Total Return Mortgage Fund Class A 07/31/2000 - 03/31/2001 $ 10.02 $ 0.39 (a) $ 0.57 (a) $ 0.96 $ (0.38) Class B 07/31/2000 - 03/31/2001 10.02 0.34 (a) 0.59 (a) 0.93 (0.35) Class C 07/31/2000 - 03/31/2001 10.02 0.34 (a) 0.61 (a) 0.95 (0.37)
+ Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) Effective September 29, 2000, the Strategic Balanced Fund did not incur advisory fee expenses. 138 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Dividends in Distributions Distributions in Ratio of Excess of Net from Net Excess of Net Expenses to Investment Realized Capital Realized Capital Total Net Asset Value Net Assets End Average Net Income Gains Gains Distributions End of Period Total Return of Period (000s) Assets ----------------------------------------------------------------------------------------------------------------------------------- $ 0.00 $ 0.00 $ (0.91) $ (1.15) $ 10.10 (21.31)% $ 108,332 1.05% 0.00 (0.97) (0.51) (2.52) 14.06 17.26 160,847 1.05 0.00 (1.24) 0.00 (2.02) 14.26 17.07 148,748 1.05 0.00 (1.09) 0.00 (2.47) 14.06 47.07 62,970 1.05 0.00 0.00 0.00 (0.15) 11.46 (2.59) 5,790 1.10+ 0.00 0.00 (0.91) (1.10) 9.98 (21.91) 240,913 1.80 0.00 (0.97) (0.51) (2.42) 13.96 16.40 374,171 1.80 0.00 (1.24) 0.00 (1.93) 14.18 16.21 281,930 1.80 0.00 (1.09) 0.00 (2.39) 14.01 46.11 99,039 1.80 0.00 0.00 0.00 (0.14) 11.44 (2.81) 8,281 1.88+ 0.00 0.00 (0.91) (1.11) 10.03 (21.66) 207,945 1.55 0.00 (0.97) (0.51) (2.45) 14.00 16.69 311,942 1.55 0.00 (1.24) 0.00 (1.96) 14.21 16.48 245,088 1.55 0.00 (1.09) 0.00 (2.41) 14.03 46.38 96,960 1.55 0.00 0.00 0.00 (0.14) 11.45 (2.71) 11,254 1.65+ $ 0.00 $ 0.00 $ (0.69) $ (1.31) $ 10.42 (8.58)% $ 3,660 0.86%(b) (0.15) (0.31) 0.00 (1.18) 12.74 9.34 4,468 1.05+ 0.00 0.00 (0.69) (1.23) 10.40 (9.28) 8,484 1.57 (b) (0.15) (0.31) 0.00 (1.13) 12.72 8.61 11,604 1.80+ 0.00 0.00 (0.69) (1.23) 10.37 (9.32) 14,004 1.58 (b) (0.15) (0.31) 0.00 (1.13) 12.70 8.47 13,116 1.80+ $ (0.02) $ 0.00 $ 0.00 $ (0.62) $ 10.52 12.27% $ 3,061,033 0.96%(d) (0.02) 0.00 0.00 (0.58) 9.96 1.85 1,947,405 1.01 (d) 0.00 (0.24) (0.18) (1.00) 10.36 7.09 1,140,606 0.90 (0.02) (0.27) 0.00 (0.86) 10.62 12.11 533,893 0.90 0.00 0.00 0.00 (0.13) 10.27 0.02 115,742 0.91+ (0.01) 0.00 0.00 (0.55) 10.52 11.44 975,823 1.70 (c) (0.02) 0.00 0.00 (0.50) 9.96 1.08 654,104 1.76 (c) 0.00 (0.24) (0.18) (0.92) 10.36 6.28 549,478 1.65 (0.01) (0.27) 0.00 (0.78) 10.62 11.26 186,932 1.65 0.00 0.00 0.00 (0.12) 10.27 (0.10) 74,130 1.67+ (0.01) 0.00 0.00 (0.55) 10.52 11.44 1,103,702 1.71 (c) (0.02) 0.00 0.00 (0.50) 9.96 1.09 720,199 1.75 (c) 0.00 (0.24) (0.18) (0.92) 10.36 6.29 715,201 1.65 (0.01) (0.27) 0.00 (0.79) 10.62 11.28 405,037 1.65 0.00 0.00 0.00 (0.12) 10.27 (0.11) 329,104 1.67+ $ 0.00 $ (0.18) $ 0.00 $ (0.56) $ 10.42 10.58% $ 769 0.90%+ 0.00 (0.18) 0.00 (0.53) 10.42 9.95 816 1.65+ 0.00 (0.18) 0.00 (0.55) 10.42 9.94 1,908 1.65+ Ratio of Net Investment Income (Loss) to Average Portfolio Net Assets Turnover Rate ---------------------------------- (0.05)% 270% 7.21 92 6.66 81 13.34 30 (10.69)+ 47 (0.74) 270 6.27 92 6.05 81 12.60 30 (15.13)+ 47 (0.59) 270 6.47 92 6.19 81 12.85 30 (12.79)+ 47 7.44% 651% 5.99+ 176 6.59 651 5.61+ 176 6.76 651 5.66+ 176 6.08% 450% 5.79 223 5.37 154 5.46 206 6.08+ 173 5.33 450 5.01 223 4.55 154 4.74 206 5.28+ 173 5.34 450 5.01 223 4.63 154 4.83 206 5.32+ 173 5.68%+ 848% 4.89+ 848 4.94+ 848
(c) Ratio of expenses to average net assets excluding interest expense is 1.65%. (d) Ratio of expenses to average net assets excluding interest expense is 0.90%. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 139 PIMCO Statements of Assets and Liabilities A, B, and C Classes March 31, 2001
California Intermediate California Emerging Amounts in thousands, Municipal Municipal Convertible Markets Foreign except per share amounts Bond Fund Bond Fund Fund Bond Fund Bond Fund ------------------------------------------------------------------------------------------------------------------------------------ Assets: Investments, at value $ 119,480 $ 12,320 $ 86,394 $ 58,386 $ 1,040,636 Cash and foreign currency 2 140 0 0 37,332 Receivable for investments and foreign currency sold 0 0 19,247 16,961 84,303 Receivable for Fund shares sold 144 0 641 7 1,594 Interest and dividends receivable 1,737 172 393 1,237 16,720 Variation margin receivable 0 3 0 0 0 Manager reimbursement receivable 14 29 10 0 0 Other assets 0 0 1 0 1,681 $ 121,377 $ 12,664 $ 106,686 $ 76,591 $ 1,182,266 ------------------------------------------------------ ------------ ---------- ------------- ---------- ------------- Liabilities: Payable for investments and foreign currency purchased $ 2,738 $ 0 $ 38 $ 14,857 $ 57,126 Payable for financing transactions 0 0 0 1,449 446,311 Payable for short sales 0 0 0 0 0 Due to Custodian 0 0 1,604 2,498 0 Notes payable 0 0 0 0 0 Written options outstanding 0 0 0 0 2,046 Payable for Fund shares redeemed 37 0 13,251 92 999 Dividends payable 58 1 0 29 362 Accrued investment advisory fee 27 3 50 23 147 Accrued administration fee 28 3 34 21 177 Accrued distribution fee 0 0 13 3 45 Accrued servicing fee 6 0 6 1 38 Variation margin payable 14 0 0 0 173 Other liabilities 5 0 0 20 1 2,913 7 14,996 18,993 507,425 ------------------------------------------------------ ------------ ---------- ------------- ---------- ------------- Net Assets $ 118,464 $ 12,657 $ 91,690 $ 57,598 $ 674,841 ------------------------------------------------------ ------------ ---------- ------------- ---------- ------------- Net Assets Consist of: Paid in capital $ 112,219 $ 12,066 $ 110,156 $ 55,779 $ 680,856 Undistributed (overdistributed) net investment income 1,115 152 (1,336) 1,525 (789) Accumulated undistributed net realized gain (loss) (68) 11 (8,984) (486) (7,969) Net unrealized appreciation (depreciation) 5,198 428 (8,146) 780 2,743 $ 118,464 $ 12,657 $ 91,690 $ 57,598 $ 674,841 ------------------------------------------------------ ------------ ---------- ------------- ---------- ------------- Net Assets: Class A $ 29,035 $ 706 $ 6,426 $ 1,143 $ 84,631 Class B 0 0 5,705 1,620 28,747 Class C 0 0 13,249 792 35,337 Other Classes 89,429 11,951 66,310 54,043 526,126 Shares Issued and Outstanding: Class A 2,740 68 563 136 8,198 Class B 0 0 503 193 2,785 Class C 0 0 1,166 94 3,423 Net Asset Value and Redemption Price* Per Share (Net Assets Per Share Outstanding) Class A $ 10.60 $ 10.35 $ 11.41 $ 8.40 $ 10.32 Class B 0.00 0.00 11.34 8.40 10.32 Class C 0.00 0.00 11.37 8.40 10.32 Cost of Investments Owned $ 114,374 $ 11,884 $ 94,684 $ 57,651 $ 1,061,915 ------------------------------------------------------ ------------ ---------- ------------- ---------- ------------- Cost of Foreign Currency Held $ 0 $ 0 $ 22 $ 0 $ 37,473 ------------------------------------------------------ ------------ ---------- ------------- ---------- -------------
*With respect to the Retail Classes, the redemption price varies by the length of time the shares are held. 140 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
New York Global Long-Term Low Duration Money Market Municipal Municipal Real Return Bond Fund II High Yield Fund U.S. Gov't Fund Fund Fund Bond Fund Bond Fund Bond Fund ------------------------------------------------------------------------------------------------------------------------------------ $ 124,305 $ 2,551,020 $ 699,912 $ 8,365,786 $ 350,038 $ 84,850 $ 3,973 $ 1,558,398 5,419 5,303 91 4,017 159 2 1 1,977 8,140 35,585 104,544 843,152 0 0 0 96,777 29 37,429 2,148 11,388 6,947 318 0 10,321 2,153 48,416 7,109 59,063 551 1,041 66 14,895 0 0 496 85 0 0 0 0 0 0 0 0 0 0 14 0 602 13,788 7 343 0 1 0 764 $ 140,648 $ 2,691,541 $ 814,307 $ 9,283,834 $ 357,695 $ 86,212 $ 4,054 $ 1,683,132 ------------ --------------- -------------- -------------- ------------ ------------ ------------ -------------- $ 5,756 $ 37,218 $ 53,214 $ 3,405,245 $ 1,047 $ 5,647 $ 0 $ 22,680 58,408 0 274,830 348,283 0 0 0 756,305 0 0 0 703,503 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 156,287 0 0 0 0 141 0 849 2,050 0 0 0 0 14 3,479 1,881 57,470 7,514 282 0 2,000 34 5,404 554 3,541 40 78 0 1,075 17 578 109 1,001 42 17 1 184 22 709 129 813 79 21 1 218 7 556 70 134 23 20 0 73 3 218 36 107 20 11 0 57 60 0 366 0 0 0 0 27 93 1,237 1,220 2,111 0 0 0 1,391 64,555 49,399 333,258 4,680,545 8,765 6,076 2 784,010 ------------ --------------- -------------- -------------- ------------ ------------ ------------ -------------- $ 76,093 $ 2,642,142 $ 481,049 $ 4,603,289 $ 348,930 $ 80,136 $ 4,052 $ 899,122 ------------ --------------- -------------- -------------- ------------ ------------ ------------ -------------- $ 76,688 $ 3,109,817 $ 473,798 $ 4,630,511 $ 348,908 $ 77,328 $ 3,843 $ 862,868 (37) (1,912) 57 254 22 17 66 3,210 (896) (300,146) (2,646) (47,743) 0 363 29 (786) 338 (165,617) 9,840 20,267 0 2,428 114 33,830 $ 76,093 $ 2,642,142 $ 481,049 $ 4,603,289 $ 348,930 $ 80,136 $ 4,052 $ 899,122 ------------ --------------- -------------- -------------- ------------ ------------ ------------ -------------- $ 2,747 $ 262,572 $ 79,477 $ 273,994 $ 58,940 $ 11,381 $ 186 $ 95,899 5,243 327,367 54,374 88,585 38,286 8,513 0 54,875 5,208 373,530 35,675 119,062 108,549 30,539 0 81,407 62,895 1,678,673 311,523 4,121,648 143,155 29,703 3,866 666,941 286 26,589 7,464 27,321 58,939 1,136 17 9,221 546 33,150 5,107 8,833 38,285 850 0 5,277 542 37,824 3,351 11,872 108,548 3,048 0 7,828 $ 9.61 $ 9.88 $ 10.65 $ 10.03 $ 1.00 $ 10.02 $ 10.64 $ 10.40 9.61 9.88 10.65 10.03 1.00 10.02 0.00 10.40 9.61 9.88 10.65 10.03 1.00 10.02 0.00 10.40 $ 127,242 $ 2,716,720 $ 686,690 $ 8,337,219 $ 350,038 $ 82,422 $ 3,859 $ 1,524,018 ------------ --------------- -------------- -------------- ------------ ------------ ------------ -------------- $ 4,846 $ 2,627 $ 0 $ 4,446 $ 0 $ 0 $ 0 $ 431 ------------ --------------- -------------- -------------- ------------ ------------ ------------ --------------
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 141 PIMCO Statements of Assets and Liabilities A, B, and C Classes (Cont.) March 31, 2001
Amounts in thousands, Short-Term StocksPLUS Strategic Total Return Total Return except per share amounts Fund Fund Balanced Fund Fund Mortgage Fund ------------------------------------------------------------------------------------------------------------------------------------ Assets: Investments, at value $ 1,158,227 $ 1,543,635 $ 73,945 $ 64,127,213 $ 37,190 Cash and foreign currency 1,003 3,850 716 218,324 1,197 Receivable for investments and foreign currency sold 294,322 16,915 0 4,821,384 10,581 Receivable for Fund shares sold 7,914 752 43 249,896 72 Interest and dividends receivable 11,006 2,449 172 476,095 109 Variation margin receivable 0 5,075 0 8,311 0 Manager reimbursement receivable 0 0 0 0 0 Other assets 253 4 0 1,125 1 $ 1,472,725 $ 1,572,680 $ 74,876 $ 69,902,348 $ 49,150 ----------------------------------------------------- ------------- ------------ ------------ ------------- ------------ Liabilities: Payable for investments and foreign currency purchased $ 4,077 $ 535,113 $ 251 $ 21,420,265 $ 24,016 Payable for financing transactions 443,596 392 0 5,667,668 0 Payable for short sales 295,950 0 0 0 0 Due to Custodian 0 0 0 0 0 Notes payable 72,131 383 0 0 0 Written options outstanding 0 815 0 42,637 0 Payable for Fund shares redeemed 3,537 18,316 89 134,060 49 Dividends payable 834 10 0 46,539 3 Accrued investment advisor's fee 140 368 0 9,171 5 Accrued administrator's fee 127 306 11 7,573 6 Accrued distribution fee 11 266 15 3,345 0 Accrued servicing fee 26 128 6 1,139 3 Variation margin payable 5 275 0 3,094 0 Other liabilities 1,118 825 0 61,464 0 821,552 557,197 372 27,396,955 24,082 ----------------------------------------------------- ------------- ------------ ------------ ------------- ------------ Net Assets $ 651,173 $ 1,015,483 $ 74,504 $ 42,505,393 $ 25,068 ----------------------------------------------------- ------------- ------------ ------------ ------------- ------------ Net Assets Consist of: Paid in capital $ 650,737 $ 1,334,218 $ 87,158 $ 41,959,747 $ 24,059 Undistributed (overdistributed) net investment income (1,518) (26,538) 465 154,725 382 Accumulated undistributed net realized gain (loss) (868) (271,284) (2,315) (48,115) (1) Net unrealized appreciation (depreciation) 2,822 (20,913) (10,804) 439,036 628 $ 651,173 $ 1,015,483 $ 74,504 $ 42,505,393 $ 25,068 ----------------------------------------------------- ------------- ------------ ------------ ------------- ------------ Net Assets: Class A $ 84,342 $ 108,332 $ 3,660 $ 3,061,033 $ 769 Class B 6,954 240,913 8,484 975,823 816 Class C 23,961 207,945 14,004 1,103,702 1,908 Other Classes 535,916 458,293 48,356 37,364,835 21,575 Shares Issued and Outstanding: Class A 8,411 10,721 351 291,008 74 Class B 694 24,128 816 92,770 78 Class C 2,390 20,726 1,350 104,927 183 Net Asset Value and Redemption Price* Per Share (Net Assets Per Share Outstanding) Class A $ 10.03 $ 10.10 $ 10.42 $ 10.52 $ 10.42 Class B 10.03 9.98 10.40 10.52 10.42 Class C 10.03 10.03 10.37 10.52 10.42 Cost of Investments Owned $ 1,152,292 $ 1,541,379 $ 84,847 $ 63,623,558 $ 36,562 ----------------------------------------------------- ------------- ------------ ------------ ------------- ------------ Cost of Foreign Currency Held $ 991 $ 3,832 $ 561 $ 274,176 $ 0 ----------------------------------------------------- ------------- ------------ ------------ ------------- ------------
* With respect to the Retail Classes, the redemption price varies by the length of time the shares are held. 142 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes PIMCO Statements of Operations A, B, and C Classes For the year or period ended March 31, 2001
California Intermediate California Emerging Amounts in thousands, Municipal Municipal Convertible Markets Foreign Bond Fund Bond Fund Fund Bond Fund Bond Fund ------------------------------------------------------------------------------------------------------------------------------------ Investment Income: Interest $ 4,804 $ 484 $ (607) $ 5,027 $ 37,119 Dividends, net of foreign taxes 0 0 1,708 1 480 Miscellaneous Income 1 3 0 0 0 Total Income 4,805 487 1,101 5,028 37,599 ------------------------------------------------------- ------------ ---------- ------------ ----------- ------------- Expenses: Investment advisory fees 236 24 592 211 1,478 Administration fees 257 22 407 192 1,758 Distribution fees - Class B 0 0 36 9 194 Distribution fees - Class C 0 0 94 4 235 Servicing fees - Class A 68 0 15 1 168 Servicing fees - Class B 0 0 12 3 65 Servicing fees - Class C 0 0 31 1 78 Distribution and/or servicing fees - Other Classes 4 0 1 25 59 Trustees' fees 0 0 1 0 3 Organization costs 0 29 0 0 0 Interest Expense 0 0 27 36 245 Miscellaneous 5 0 7 5 0 Total expenses 570 75 1,223 487 4,283 Reimbursement by Manager 0 (29) 0 0 0 Net Expenses 570 46 1,223 487 4,283 Net Investment Income (Loss) 4,235 441 (122) 4,541 33,316 ------------------------------------------------------- ------------ ---------- ------------ ----------- ------------- Net Realized and Unrealized Gain (Loss): Net realized gain (loss) on investments 1,557 531 (6,937) 2,776 15,252 Net capital gain distributions received from underlying funds 0 0 0 0 0 Net realized gain (loss) on futures contracts and written options (279) 13 0 0 (5,763) Net realized gain (loss) on foreign currency transactions 0 0 212 (76) (10,379) Net change in unrealized appreciation (depreciation) on investments 5,034 436 (36,311) (717) 14,127 Net change in unrealized appreciation (depreciation) on futures contracts and written options 92 (8) 0 0 (2,938) Net change in unrealized appreciation (depreciation) on translation of assets and liabilities denominated in foreign currencies 0 0 199 59 20,756 Net Gain (Loss) 6,404 972 (42,837) 2,042 31,055 Net Increase (Decrease) in Assets Resulting from Operations $ 10,639 $ 1,413 $ (42,959) $ 6,583 $ 64,371 ------------------------------------------------------- ------------ ---------- ------------ ----------- -------------
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 143 PIMCO Statements of Operations A, B, and C Classes (Cont.) For the year or period ended March 31, 2001
Amounts in thousands Global High Long-Term Low Money Bond Fund II Yield Fund U.S. Gov't Fund Duration Fund Market Fund ----------------------------------------------------------------------------------------------------------------------------------- Investment Income: Interest $ 4,966 $ 262,112 $ 26,931 $ 305,644 $ 25,415 Dividends, net of foreign taxes 53 7,951 0 7,445 0 Miscellaneous Income 0 60 0 0 0 Total Income 5,019 270,123 26,931 313,089 25,415 --------------------------------------------------------- ------------ ----------- ----------- ------------ ----------- Expenses: Investment advisory fees 192 7,084 1,026 10,648 596 Administration fees 247 8,316 1,199 8,636 1,056 Distribution fees - Class A 0 0 0 0 0 Distribution fees - Class B 34 2,215 289 575 180 Distribution fees - Class C 36 2,487 187 556 0 Servicing fees - Class A 6 492 131 620 64 Servicing fees - Class B 11 738 96 192 60 Servicing fees - Class C 12 829 62 278 88 Distribution and/or servicing fees - Other Classes 0 1,120 117 381 21 Trustees' fees 0 15 2 23 2 Organization costs 0 0 0 0 0 Interest Expense 27 0 231 2,684 6 Miscellaneous 0 5 1 0 0 Total expenses 565 23,301 3,341 24,593 2,073 Net Investment Income (Loss) 4,454 246,822 23,590 288,496 23,342 --------------------------------------------------------- ------------ ----------- ----------- ------------ ----------- Net Realized and Unrealized Gain (Loss): Net realized gain (loss) on investments 2,780 (237,944) 25,791 7,880 0 Net capital gain distributions received from underlying funds 0 0 0 0 0 Net realized gain (loss) on futures contracts and written options (178) 0 3,792 (37) 0 Net realized gain (loss) on foreign currency transactions (131) (42) 0 9,157 0 Net change in unrealized appreciation (depreciation) on investments (568) 111,549 6,963 81,101 0 Net change in unrealized appreciation (depreciation) on futures contracts and written options (673) 0 (649) 2,894 0 Net change in unrealized appreciation (depreciation) on translation of assets and liabilities denominated in foreign currencies 2,599 45 0 (3,086) 0 Net Gain (Loss) 3,829 (126,392) 35,897 97,909 0 Net Increase (Decrease) in Assets Resulting from Operations $ 8,283 $ 120,430 $ 59,487 $ 386,405 $ 23,342 --------------------------------------------------------- ------------ ----------- ----------- ------------ -----------
144 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
New York Municipal Municipal Real Return Short-Term StocksPLUS Strategic Total Return Total Return Bond Fund Bond Fund Bond Fund Fund Fund Balanced Fund Fund Mortgage Fund ------------------------------------------------------------------------------------------------------------------------------- $ 3,329 $ 162 $ 44,071 $ 50,985 $ 12,663 $ 3,393 $ 2,508,225 $ 1,127 0 0 11 0 1,152 2,414 32,065 0 3 0 0 0 45 0 104 0 3,332 162 44,082 50,985 13,860 5,807 2,540,394 1,127 ----------- ---------- ------------ ------------ ------------ ------------ ------------- ------------ 153 8 1,358 1,707 5,319 217 89,506 42 196 8 1,559 1,530 4,439 224 73,048 44 0 0 0 0 0 0 0 0 44 0 188 50 2,427 77 5,526 0 142 0 181 57 1,346 97 6,105 0 19 0 104 205 368 10 5,783 1 15 0 63 17 809 26 1,842 2 72 0 91 48 673 32 2,035 5 12 0 118 30 96 2 10,285 1 0 0 3 4 7 0 196 0 0 0 2 0 0 0 0 0 0 0 217 3,817 0 14 21,417 5 0 0 2 1 3 0 0 0 653 16 3,886 7,466 15,487 699 215,743 100 2,679 146 40,196 43,519 (1,627) 5,108 2,324,651 1,027 ----------- ---------- ------------ ------------ ------------ ------------ ------------- ------------ 1,370 101 6,609 1,431 4,385 (1,201) 983,913 741 0 0 0 0 0 1,770 0 0 (72) 31 338 (93) (183,594) 3,916 248,438 10 0 0 624 (1,134) (403) (972) (4,989) 0 2,568 122 29,647 6,058 6,605 (9,323) 800,434 651 0 0 83 88 (119,526) (6,479) (6,524) (2) 0 0 495 36 4,312 72 1,460 0 3,866 254 37,796 6,386 (288,221) (12,217) 2,021,732 1,400 $ 6,545 $ 400 $ 77,992 $ 49,905 $ (289,848) $ (7,109) $ 4,346,383 $ 2,427 ----------- ---------- ------------ ------------ ------------ ------------ ------------- ------------
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 145 PIMCO Statements of Changes in Net Assets A, B, and C Classes
California California Intermediate Municipal Amounts in thousands Municipal Bond Fund Bond Fund ------------------------------------------------------------ Year Ended Period from Period from Increase (Decrease) in Net Assets from: March 31, 2001 August 31, 1999 to May 16, 2000 to March 31, 2000 March 31, 2000 ------------------------------------------------------------------------------------------------------------------------------------ Operations: Net investment income (loss) $ 4,235 $ 106 $ 441 Net realized gain (loss) 1,278 (5) 544 Net capital gain distributions received from underlying funds 0 0 0 Net change in unrealized appreciation (depreciation) 5,126 72 428 Net increase (decrease) resulting from operations 10,639 173 1,413 ------------------------------------------------------------- -------------- --------------- -------------- Distributions to Shareholders: From net investment income Class A (1,121) (8) (4) Class B 0 0 0 Class C 0 0 0 Other Classes (3,023) (97) (428) In excess of net investment income Class A 0 0 0 Class B 0 0 0 Class C 0 0 0 Other Classes 0 0 0 From net realized capital gains Class A (100) 0 0 Class B 0 0 0 Class C 0 0 0 Other Classes (211) 0 (390) In excess of net realized capital gains Class A 0 (1) 0 Class B 0 0 0 Class C 0 0 0 Other Classes 0 (6) 0 Total Distributions (4,455) (112) (822) ------------------------------------------------------------- -------------- --------------- -------------- Fund Share Transactions: Receipts for shares sold Class A 41,939 1,879 809 Class B 0 0 0 Class C 0 0 0 Other Classes 114,297 8,860 21,146 Issued in reorganization Class A 0 0 0 Class B 0 0 0 Class C 0 0 0 Other Classes 0 0 0 Issued as reinvestment of distributions Class A 1,122 12 3 Class B 0 0 0 Class C 0 0 0 Other Classes 3,117 91 808 Cost of shares redeemed Class A (17,618) (119) (110) Class B 0 0 0 Class C 0 0 0 Other Classes (40,805) (556) (10,590) Net increase (decrease) resulting from Fund share transactions 102,052 10,167 12,066 Total Increase (Decrease) in Net Assets 108,236 10,228 12,657 ------------------------------------------------------------- -------------- --------------- -------------- Net Assets Beginning of period 10,228 0 0 End of period * $ 118,464 $ 10,228 $ 12,657 *Including net undistributed (overdistributed) investment income of: $ 1,115 $ 1 $ 152 Amounts in thousands Convertible Fund Year Ended Year Ended Increase (Decrease) in Net Assets from: March 31, 2001 March 31, 2000 ------------------------------------------------------------------------------------------------------------ Operations: Net investment income (loss) $ (122) $ 293 Net realized gain (loss) (6,725) 7,821 Net capital gain distributions received from underlying funds 0 0 Net change in unrealized appreciation (depreciation) (36,112) 27,966 Net increase (decrease) resulting from operations (42,959) 36,080 ------------------------------------------------------------- -------------- --------------- Distributions to Shareholders: From net investment income Class A (97) (8) Class B (49) (2) Class C (115) (7) Other Classes (2,107) (276) In excess of net investment income Class A 0 (34) Class B 0 (10) Class C 0 (32) Other Classes 0 (1,195) From net realized capital gains Class A 0 (17) Class B 0 (6) Class C 0 (19) Other Classes 0 (577) In excess of net realized capital gains Class A (328) 0 Class B (297) 0 Class C (729) 0 Other Classes (5,681) 0 Total Distributions (9,403) (2,183) ------------------------------------------------------------- -------------- --------------- Fund Share Transactions: Receipts for shares sold Class A 5,137 4,800 Class B 5,738 2,593 Class C 11,544 6,988 Other Classes 90,634 176,112 Issued in reorganization Class A 0 0 Class B 0 0 Class C 0 0 Other Classes 0 0 Issued as reinvestment of distributions Class A 360 58 Class B 170 13 Class C 543 49 Other Classes 7,574 1,984 Cost of shares redeemed Class A (2,198) (363) Class B (1,077) (337) Class C (2,818) (141) Other Classes (155,586) (41,632) Net increase (decrease) resulting from Fund share transactions (39,979) 150,134 Total Increase (Decrease) in Net Assets (92,341) 184,031 ------------------------------------------------------------- -------------- --------------- Net Assets Beginning of period 184,031 0 End of period * $ 91,690 $ 184,031 *Including net undistributed (overdistributed) investment income of: $ (1,336) $ 5,512
146 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Emerging Markets Bond Fund Foreign Bond Fund Global Bond Fund II Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 ------------------------------------------------------------------------------------------------------- $ 4,541 $ 2,012 $ 33,316 $ 35,220 $ 4,454 $ 3,256 2,700 1,254 (890) 4,992 2,471 (824) 0 0 0 0 0 0 (658) 2,001 31,945 (31,738) 1,358 (803) 6,583 5,267 64,371 8,474 8,283 1,629 ------------- ------------- ------------- ------------ ------------- -------------- (47) (25) (3,562) (2,482) (122) (149) (119) (78) (1,185) (1,179) (215) (229) (44) (26) (1,435) (1,515) (233) (268) (4,335) (1,882) (26,951) (30,001) (3,875) (2,569) 0 0 0 0 0 (2) 0 0 0 0 0 (4) 0 0 0 0 0 (5) 0 0 0 0 0 (41) 0 0 0 (416) (14) 0 0 0 0 (209) (27) 0 0 0 0 (262) (27) 0 0 0 0 (3,938) (379) 0 (16) 0 (1,472) (315) (57) (6) (67) 0 (555) (158) (112) (9) (25) 0 (661) (198) (111) (11) (2,244) 0 (10,182) (2,976) (1,552) (95) (6,897) (2,011) (46,003) (43,649) (6,724) (3,388) ------------- ------------- ------------- ------------ ------------- -------------- 1,552 185 47,003 47,005 1,250 1,600 1,124 716 6,565 10,650 1,259 1,267 819 68 9,154 10,346 1,310 1,527 35,612 42,500 205,439 191,536 6,935 59,618 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 41 20 4,276 2,623 153 124 84 39 1,313 1,204 236 177 28 14 1,717 1,630 282 244 6,256 1,803 32,854 29,929 5,308 2,526 (765) (95) (23,163) (22,268) (990) (2,026) (740) (118) (4,326) (7,337) (945) (1,506) (295) (98) (6,727) (9,583) (1,750) (2,083) (13,651) (25,001) (163,157) (295,818) (35,563) (5,204) 30,065 20,033 110,948 (40,083) (22,515) 56,264 29,751 23,289 129,316 (75,258) (20,956) 54,505 ------------- ------------- ------------- ------------ ------------- -------------- 27,847 4,558 545,525 620,783 97,049 42,544 $ 57,598 $ 27,847 $ 674,841 $ 545,525 $ 76,093 $ 97,049 $ 1,525 $ 862 $ (789) $ 15,115 $ (37) $ 889 High Yield Fund Long-Term U.S. Gov't Fund Year Ended Year Ended Year Ended Year Ended March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 --------------------------------------------------------------------- $ 246,822 $ 296,022 $ 23,590 $ 20,805 (237,986) (70,452) 29,583 (25,059) 0 0 0 0 111,594 (263,887) 6,314 7,958 120,430 (38,317) 59,487 3,704 -------------- -------------- --------------- ------------- (16,909) (15,406) (2,965) (1,946) (23,255) (23,625) (1,881) (1,936) (26,108) (28,389) (1,204) (1,340) (178,560) (226,319) (17,531) (15,549) (129) (113) 0 0 (178) (172) 0 0 (199) (207) 0 0 (1,363) (1,652) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (246,701) (295,883) (23,581) (20,771) -------------- -------------- --------------- ------------- 215,973 214,375 65,435 39,235 104,829 141,755 29,267 16,036 157,741 217,795 27,453 10,916 1,060,499 1,500,396 247,593 218,562 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 9,591 9,497 2,067 1,509 9,305 11,679 983 1,334 13,854 17,370 751 1,016 156,080 203,172 14,726 13,146 (142,592) (174,492) (34,912) (26,743) (79,244) (106,519) (13,312) (18,920) (127,866) (228,700) (15,587) (20,940) (1,780,150) (1,524,985) (234,568) (144,475) (401,980) 281,343 89,896 90,676 (528,251) (52,857) 125,802 73,609 -------------- -------------- --------------- -------------- 3,170,393 3,223,250 355,247 281,638 $ 2,642,142 $ 3,170,393 $ 481,049 $ 355,247 $ (1,912) $ (1,991) $ 57 $ 45
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 147 PIMCO Statements of Changes in Net Assets A, B, and C Classes (Cont.)
Low Amounts in thousands Duration Fund Money Market Fund -------------------------------- ------------------------------- Year Ended Year Ended Year Ended Year Ended Increase (Decrease) in Net Assets from: March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 Operations: Net investment income (loss) $ 288,496 $ 265,005 $ 23,342 $ 24,929 Net realized gain (loss) 17,000 (47,944) 0 0 Net capital gain distributions received from underlying funds 0 0 0 0 Net change in unrealized appreciation (depreciation) 80,909 (75,164) 0 0 Net increase (decrease) resulting from operations 386,405 141,897 23,342 24,929 ------------------------------------------------------------- ------------- ------------- ------------- ------------- Distributions to Shareholders: From net investment income Class A (15,354) (13,205) (3,696) (5,341) Class B (4,183) (3,668) (1,180) (735) Class C (6,344) (6,311) (5,051) (4,148) Other Classes (254,225) (237,815) (13,413) (14,699) In excess of net investment income Class A (461) (200) 0 0 Class B (126) (55) 0 0 Class C (191) (96) 0 0 Other Classes (7,641) (3,599) 0 0 From net realized capital gains Class A 0 0 0 0 Class B 0 0 0 0 Class C 0 0 0 0 Other Classes 0 0 0 0 In excess of net realized capital gains Class A 0 0 0 0 Class B 0 0 0 0 Class C 0 0 0 0 Other Classes 0 0 0 0 Total Distributions (288,525) (264,949) (23,340) (24,923) ------------------------------------------------------------- ------------- ------------- ------------- ------------- Fund Share Transactions: Receipts for shares sold Class A 219,648 415,786 1,564,604 5,545,908 Class B 38,949 53,258 81,175 110,792 Class C 48,731 55,588 666,874 1,134,937 Other Classes 2,552,105 2,950,320 162,115 427,835 Issued in reorganization Class A 0 0 0 0 Class B 0 0 0 0 Class C 0 0 0 0 Other Classes 0 0 0 0 Issued as reinvestment of distributions Class A 11,160 10,938 2,229 2,941 Class B 2,484 2,556 1,015 615 Class C 4,310 4,903 4,389 3,367 Other Classes 229,997 207,600 13,305 14,434 Cost of shares redeemed Class A (197,995) (376,451) (1,609,628) (5,552,316) Class B (27,760) (45,716) (69,411) (100,869) Class C (46,954) (58,675) (662,190) (1,124,988) Other Classes (2,319,594) (2,977,974) (347,072) (459,029) Net increase (decrease) resulting from Fund share transactions 515,081 242,133 (192,595) 3,627 Total Increase (Decrease) in Net Assets 612,961 119,081 (192,593) 3,633 ------------------------------------------------------------- ------------- ------------- ------------- ------------- Net Assets: Beginning of period 3,990,328 3,871,247 541,523 537,890 End of period * $ 4,603,289 $ 3,990,328 $ 348,930 $ 541,523 *Including net undistributed (overdistributed) investment income of: $ 254 $ (8,390) $ 22 $ 20 Amounts in thousands Municipal Bond Fund -------------------------------- Year Ended Year Ended Increase (Decrease) in Net Assets from: March 31, 2001 March 31, 2000 Operations: Net investment income (loss) $ 2,679 $ 2,314 Net realized gain (loss) 1,298 (919) Net capital gain distributions received from underlying funds 0 0 Net change in unrealized appreciation (depreciation) 2,568 (2,965) Net increase (decrease) resulting from operations 6,545 (1,570) ------------------------------------------------------------- ------------- ------------- Distributions to Shareholders: From net investment income Class A (354) (403) Class B (225) (214) Class C (1,160) (1,311) Other Classes (937) (380) In excess of net investment income Class A 0 0 Class B 0 0 Class C 0 0 Other Classes 0 0 From net realized capital gains Class A 0 0 Class B 0 0 Class C 0 0 Other Classes 0 0 In excess of net realized capital gains Class A 0 0 Class B 0 0 Class C 0 0 Other Classes 0 0 Total Distributions (2,676) (2,308) ------------------------------------------------------------- ------------- ------------- Fund Share Transactions: Receipts for shares sold Class A 6,223 7,221 Class B 5,629 3,559 Class C 4,912 3,130 Other Classes 30,520 9,608 Issued in reorganization Class A 0 0 Class B 0 0 Class C 0 0 Other Classes 0 0 Issued as reinvestment of distributions Class A 102 211 Class B 96 112 Class C 775 945 Other Classes 911 370 Cost of shares redeemed Class A (4,055) (5,201) Class B (2,900) (4,031) Class C (5,444) (10,912) Other Classes (13,085) (7,109) Net increase (decrease) resulting from Fund share transactions 23,684 (2,097) Total Increase (Decrease) in Net Assets 27,553 (5,975) ------------------------------------------------------------- ------------- ------------- Net Assets: Beginning of period 52,583 58,558 End of period * $ 80,136 $ 52,583 *Including net undistributed (overdistributed) investment income of: $ 17 $ 4
148 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
New York Municipal Bond Fund Real Return Bond Fund Short-Term Fund -------------------------------- --------------------------------- ---------------------------------- Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 $ 146 $ 70 $ 40,196 $ 7,689 $ 43,519 $ 37,374 132 (4) 7,571 317 204 (1,776) 0 0 0 0 0 0 122 (8) 30,225 3,722 6,182 (3,309) 400 58 77,992 11,728 49,905 32,289 -------------------------------- --------------------------------- ---------------------------------- (1) 0 (2,945) (649) (4,951) (4,576) 0 0 (1,600) (442) (353) (228) 0 0 (2,448) (493) (1,107) (909) (144) (70) (33,304) (5,952) (37,088) (31,652) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (410) (19) 0 0 0 0 (249) (12) 0 0 0 0 (339) (19) 0 0 (28) 0 (4,211) (243) 0 0 0 0 0 0 (126) 0 0 0 0 0 (11) 0 0 0 0 0 (31) 0 0 (6) 0 0 (893) 0 (173) (76) (45,506) (7,829) (44,560) (37,365) -------------------------------- --------------------------------- ---------------------------------- 185 10 82,016 11,806 90,544 102,581 0 0 46,156 9,829 5,009 8,403 0 0 68,127 17,048 17,069 22,931 400 3,010 521,572 214,305 571,111 1,224,707 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 2,408 506 3,540 3,855 0 0 1,119 307 234 180 0 0 1,523 284 468 737 172 76 34,164 4,724 29,138 22,331 (11) 0 (8,866) (1,110) (86,081) (110,878) 0 0 (5,441) (2,416) (5,037) (5,669) 0 0 (7,743) (2,761) (12,670) (20,188) 0 0 (138,260) (14,771) (676,498) (1,136,901) 747 3,096 596,775 237,751 (63,173) 112,089 974 3,078 629,261 241,650 (57,828) 107,013 -------------------------------- --------------------------------- ---------------------------------- 3,078 0 269,861 28,211 709,001 601,988 $ 4,052 $ 3,078 $ 899,122 $ 269,861 $ 651,173 $ 709,001 $ 66 $ 0 $ 3,210 $ 1,023 $ (1,518) $ 356 StocksPLUS Fund Strategic Balanced Fund -------------------------------- --------------------------------- Year Ended Year Ended Year Ended Year Ended March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 $ (1,627) $ 98,837 $ 5,108 $ 8,094 (179,612) 38,756 1,743 (274) 0 0 1,770 0 (108,609) 87,250 (15,730) 4,531 (289,848) 224,843 (7,109) 12,351 -------------------------------- --------------------------------- (2,688) (12,776) (205) (241) (4,878) (24,377) (466) (542) (4,310) (22,197) (580) (553) (12,257) (48,619) (2,983) (7,091) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (10,979) 0 (52) 0 (23,440) 0 (145) 0 (20,814) 0 (147) 0 (40,302) 0 (1,436) (10,401) (5,698) (220) (105) (21,799) (12,164) (564) (293) (18,410) (10,800) (739) (296) (38,105) (20,915) (2,927) (2,885) (112,848) (253,081) (8,684) (13,787) -------------------------------- --------------------------------- 114,951 225,386 1,366 2,703 44,932 145,530 1,205 4,146 42,342 139,471 6,349 5,532 213,063 284,609 4,620 9,120 0 0 0 8,167 0 0 0 11,192 0 0 0 11,513 0 0 0 35,908 9,885 27,851 362 336 19,868 54,645 784 821 19,135 50,658 1,030 893 49,296 107,331 5,829 7,151 (132,114) (240,512) (1,761) (5,306) (99,474) (99,404) (3,157) (3,077) (82,398) (114,424) (3,895) (3,424) (280,102) (255,850) (77,433) (27,359) (80,616) 325,291 (64,701) 58,316 (483,312) 297,053 (80,494) 56,880 -------------------------------- --------------------------------- 1,498,795 1,201,742 154,998 98,118 $ 1,015,483 $ 1,498,795 $ 74,504 $ 154,998 $ (26,538) $ 38,389 $ 465 $ 1,795
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 149 PIMCO Statements of Changes in Net Assets A, B, and C Classes (Cont.)
Amounts in thousands Total Return Fund Total Return Mortgage Fund ------------------------------- ------------------------------- Year Ended Year Ended Year Ended Year Ended Increase (Decrease) in Net Assets from: March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 Operations: Net investment income $ 2,324,651 $ 1,778,306 $ 1,027 $ 238 Net realized gain (loss) 1,226,362 (847,388) 751 (6) Net capital gain distributions received from underlying funds 0 0 0 0 Net change in unrealized appreciation (depreciation) 795,370 (242,138) 649 (78) Net increase resulting from operations 4,346,383 688,780 2,427 154 --------------------------------------------------------------- ------------------------------- -------------------------------- Distributions to Shareholders: From net investment income Class A (138,209) (89,782) (13) 0 Class B (38,566) (30,635) (8) 0 Class C (42,588) (36,340) (28) 0 Other Classes (2,047,388) (1,544,481) (978) (238) In excess of net investment income Class A (3,780) (3,855) 0 0 Class B (1,055) (1,315) 0 0 Class C (1,165) (1,560) 0 0 Other Classes (56,002) (66,316) 0 0 From net realized capital gains Class A 0 0 (6) 0 Class B 0 0 (4) 0 Class C 0 0 (18) 0 Other Classes 0 0 (335) 0 In excess of net realized capital gains Class A 0 0 0 0 Class B 0 0 0 0 Class C 0 0 0 0 Other Classes 0 0 0 (3) Total Distributions (2,328,753) (1,774,284) (1,390) (241) --------------------------------------------------------------- ------------------------------- -------------------------------- Fund Share Transactions: Receipts for shares sold Class A 1,764,570 1,506,055 1,132 0 Class B 382,832 282,282 865 0 Class C 493,040 312,021 2,205 0 Other Classes 13,706,067 11,402,013 20,314 227 Issued in reorganization Class A 0 0 0 0 Class B 0 0 0 0 Class C 0 0 0 0 Other Classes 0 0 0 0 Issued as reinvestment of distributions Class A 66,764 75,662 14 0 Class B 21,289 21,883 11 0 Class C 25,930 27,579 41 0 Other Classes 1,737,051 1,288,826 1,308 240 Cost of shares redeemed Class A (848,932) (716,288) (384) 0 Class B (123,611) (175,145) (68) 0 Class C (180,906) (304,175) (363) 0 Other Classes (8,092,604) (7,223,440) (5,181) (554) Net increase (decrease) resulting from Fund share transactions 8,951,490 6,497,273 19,894 (87) Total Increase (Decrease) in Net Assets 10,969,120 5,411,769 20,931 (174) --------------------------------------------------------------- ------------------------------- -------------------------------- Net Assets: Beginning of period 31,536,273 26,124,504 4,137 4,311 End of period * $ 42,505,393 $ 31,536,273 $ 25,068 $ 4,137 *Including net undistributed (overdistributed) investment income of: $ 154,725 $ (57,894) $ 382 $ 4
150 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes PIMCO Statements of Cash Flows A, B, and C Classes
Long-Term Amounts in thousands Short-Term U.S. Gov't Real Return Foreign Fund Fund Bond Fund Bond Fund -------------- -------------- ------------- -------------------- Increase (Decrease) in Cash and Foreign Currency from: Financing Activities Sales of Fund shares $ 679,178 $ 368,274 $ 708,752 $ 268,133 Redemptions of Fund shares (803,817) (297,340) (158,587) (197,372) Cash distributions paid (13,952) (4,962) (5,636) (5,980) Increase (decrease) from financing transactions 437,482 (5,569) 588,733 167,403 Net increase from financing activities 298,891 60,403 1,133,262 232,184 ----------------------------------------------------------- -------------- -------------- ------------- -------------------- Operating Activities Purchases of long-term securities and foreign currency (1,652,199) (6,942,341) (3,285,517) (4,245,078) Proceeds from sales of long-term securities and foreign 1,081,041 6,849,537 2,336,368 4,059,928 currency Purchases of short-term securities (net) 227,689 4,651 (178,550) (60,295) Net investment income 43,519 23,590 40,196 33,316 Change in other receivables/payables (net) 1,434 4,250 (44,116) 7,619 Net (decrease) from operating activities (298,516) (60,313) (1,131,619) (204,510) ----------------------------------------------------------- -------------- -------------- ------------- -------------------- Net Increase in Cash and Foreign Currency 375 90 1,643 27,674 ----------------------------------------------------------- -------------- -------------- ------------- -------------------- Cash and Foreign Currency Beginning of period 628 1 334 9,658 End of period $ 1,003 $ 91 $ 1,977 $ 37,332 Amounts in thousands Global Global Bond Fund Bond Fund II ----------- ------------ Increase (Decrease) in Cash and Foreign Currency from: Financing Activities Sales of Fund shares $ 153,653 $ 10,735 Redemptions of Fund shares (105,810) (39,292) Cash distributions paid (4,944) (797) Increase (decrease) from financing transactions 124,664 38,686 Net increase from financing activities 167,563 9,332 ----------------------------------------------------------- ----------- ------------ Operating Activities Purchases of long-term securities and foreign currency (2,152,421) (570,151) Proceeds from sales of long-term securities and foreign 2,006,517 557,747 currency Purchases of short-term securities (net) (4,746) 2,203 Net investment income 16,487 4,454 Change in other receivables/payables (net) (21,513) (742) Net (decrease) from operating activities (155,676) (6,489) ----------------------------------------------------------- ----------- ------------ Net Increase in Cash and Foreign Currency 11,887 2,843 ----------------------------------------------------------- ----------- ------------ Cash and Foreign Currency Beginning of period 6,695 2,576 End of period $ 18,582 $ 5,419
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 151 PIMCO Notes to Financial Statements A, B, and C Classes March 31, 2001 1. Organization PIMCO Funds: Pacific Investment Management Series (the "Trust") was established as a Massachusetts business trust on February 19, 1987. The Trust is registered under the Investment Company Act of 1940 (the "Act"), as amended, as an open-end investment management company. The Trust currently consists of 39 separate investment funds (the "Funds"). The Trust may offer up to six classes of shares: Institutional, Administrative, A, B, C and D. Each share class has identical voting rights (except that shareholders of a class have exclusive voting rights regarding any matter relating solely to that class of shares). Information presented in these financial statements pertains to the A, B and C Classes (the "Retail Classes") of the Trust. Certain detailed financial information for the Institutional, Administrative and D Classes (the "Other Classes") is provided separately and is available upon request. 2. Significant Accounting Policies The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America. The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America 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. Security Valuation. Portfolio securities and other financial instruments for which market quotations are readily available are stated at market value. Market value is determined on the basis of last reported sales prices, or if no sales are reported, as is the case for most securities traded over-the-counter, the mean between representative bid and asked quotations obtained from a quotation reporting system or from established market makers. Fixed income securities, including those to be purchased under firm commitment agreements, are normally valued on the basis of quotes obtained from brokers and dealers or pricing services. Short-term investments which mature in 60 days or less are valued at amortized cost, which approximates market value. Certain fixed income securities for which daily market quotations are not readily available may be valued, pursuant to guidelines established by the Board of Trustees, with reference to fixed income securities whose prices are more readily obtainable. Securities Transactions and Investment Income. Securities transactions are recorded as of the trade date. Securities purchased or sold on a when-issued or delayed-delivery basis may be settled a month or more after the trade date. Realized gains and losses from securities sold are recorded on the identified cost basis. Dividend income is recorded on the ex-dividend date, except certain dividends from foreign securities where the ex-dividend date may have passed, are recorded as soon as the Fund is informed of the ex-dividend date. Interest income, adjusted for the accretion of discounts and amortization of premiums, is recorded on the accrual basis. Dividends and Distributions to Shareholders. Dividends from net investment income, if any, of each Fund, except the Convertible, StocksPLUS and Strategic Balanced Funds, are declared on each day the Trust is open for business and are distributed to shareholders monthly. Dividends from net investment income, if any, of the Convertible, StocksPLUS and Strategic Balanced Funds are declared and distributed to shareholders quarterly. Net realized capital gains earned by a Fund, if any, will be distributed no less frequently than once each year. Income dividends and capital gain distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for such items as wash sales, foreign currency transactions, net operating losses and capital loss carryforwards. Distributions reflected as a tax basis return of capital in the accompanying Statements of Changes in Net Assets have been reclassified to paid in capital. In addition, other amounts have been reclassified between undistributed net investment income, accumulated undistributed net realized gains or losses and paid in capital to more appropriately conform financial accounting to tax characterizations of dividends and distributions. Foreign Currency. Foreign currencies, investments, and other assets and liabilities are translated into U.S. dollars at the exchange rates prevailing at the end of the period. Fluctuations in the value of these assets and liabilities resulting from changes in exchange rates are recorded as unrealized foreign currency gains (losses). Realized gains (losses) and unrealized appreciation (depreciation) on investment securities and income and expenses are translated on the respective dates of such transactions. The effect of changes in foreign currency exchange rates on investments in securities are not segregated in the Statements of Operations from the effects of changes in market prices of those securities, but are included with the net realized and unrealized gain or loss on investment securities. Multiclass Operations. Each class offered by the Trust has equal rights as to assets and voting privileges. Income and non-class specific expenses of each Fund, except the Convertible Bond, StocksPLUS and Strategic Balanced Funds, are allocated daily to each class of shares based on the relative value of settled shares. Income and non-class specific expenses of the Convertible Bond, StocksPLUS and 152 PIMCO Funds Annual Report | 3.31.01 Strategic Balanced Funds are allocated daily to each class of shares based on the relative net assets of each class. Realized and unrealized capital gains and losses of each Fund are allocated daily to each class of shares based on the relative net assets of each class. Federal Income Taxes. Each Fund intends to qualify as a regulated investment company and distribute all of its taxable income and net realized gains, if applicable, to shareholders. Accordingly, no provision for Federal income taxes has been made. Financing Transactions. Certain Funds may enter into financing transactions consisting of the sale by the Fund of securities, together with a commitment to repurchase similar securities at a future date. The difference between the selling price and the future purchase price is an adjustment to interest income. If the counterparty to whom the Fund sells the security becomes insolvent, a Fund's right to repurchase the security may be restricted; the value of the security may change over the term of the financing transaction; and the return earned by a Fund with the proceeds of a financing transaction may not exceed transaction costs. Futures and Options. Certain Funds are authorized to enter into futures contracts and options. A Fund may use futures contracts and options to manage its exposure to the securities markets or to movements in interest rates and currency values. The primary risks associated with the use of futures contracts and options are imperfect correlation between the change in market value of the securities held by a Fund and the prices of futures contracts and options, the possibility of an illiquid market, and the inability of the counter-party to meet the terms of the contract. Futures contracts and purchased options are valued based upon their quoted daily settlement prices. The premium received for a written option is recorded as an asset with an equal liability which is marked to market based on the option's quoted daily settlement price. Fluctuations in the value of such instruments are recorded as unrealized appreciation (depreciation) until terminated, at which time realized gains and losses are recognized. Forward Currency Transactions. Certain Funds are authorized to enter into forward foreign exchange contracts for the purpose of hedging against foreign exchange risk arising from the Fund's investment or anticipated investment in securities denominated in foreign currencies. A Fund also may enter into these contracts for purposes of increasing exposure to a foreign currency or to shift exposure to foreign currency fluctuations from one country to another. All commitments are marked to market daily at the applicable translation rates and any resulting unrealized gains or losses are recorded. Realized gains or losses are recorded at the time the forward contract matures or by delivery of the currency. Risks may arise upon entering these contracts from the potential inability of counterparties to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Short Sales. Certain Funds have entered into short sales transactions during the fiscal year. A short sale is a transaction in which a Fund sells securities it does not own in anticipation of a decline in the market price of the securities. The Fund is obligated to deliver securities at the market price at the time the short position is closed. Possible losses from short sales may be unlimited, whereas losses from purchases cannot exceed the total amount invested. Stripped Mortgage Backed Securities (SMBS). SMBS represent a participation in, or are secured by and payable from, mortgage loans on real property, and may be structured in classes with rights to receive varying proportions of principal and interest. SMBS include interest-only securities (IOs), which receive all of the interest, and principal-only securities (POs), which receive all of the principal. If the underlying mortgage assets experience greater than anticipated payments of principal, a Fund may fail to recoup some or all of its initial investment in these securities. The market value of these securities is highly sensitive to changes in interest rates. Swaps. Certain Funds are authorized to enter into interest rate, total return and currency exchange swap agreements in order to obtain a desired return at a lower cost than if the Fund had invested directly in the asset that yielded the desired return. Swaps involve commitments to exchange components of income (generally interest or returns) pegged to the underlying assets based on a notional principal amount. Swaps are marked to market daily based upon quotations from market makers and the change, if any, is recorded as unrealized gains or losses in the Statements of Operations. A Fund bears the risk of loss of the amount expected to be received under a swap agreement in the event of the default or bankruptcy of a counterparty. Delayed Delivery Transactions. Certain Funds may purchase or sell securities on a when-issued or delayed delivery basis. These transactions involve a commitment by a Fund to purchase or sell securities for a predetermined price or yield, with payment and delivery taking place beyond the customary settlement period. When delayed delivery purchases are outstanding, a Fund will set aside and maintain until the settlement date in a segregated account, liquid assets in an amount sufficient to meet the purchase price. When purchasing a security on a delayed delivery basis, a Fund assumes the rights and risks of ownership of the security, including the risk of price and yield fluctuations, and takes such fluctuations into account when determining its net asset value. A Fund may dispose of or renegotiate a delayed 3.31.01 | PIMCO Funds Annual Report 153 PIMCO Notes to Financial Statements A, B, and C Classes (Cont.) March 31, 2001 delivery transaction after it is entered into, and may sell when-issued securities before they are delivered, which may result in a capital gain or loss. When the Fund has sold a security on a delayed delivery basis, the Fund does not participate in future gains and losses with respect to the security. Forward sales commitments are accounted for by the Fund in the same manner as forward currency contracts discussed above. Inflation-Indexed Bonds. Inflation-indexed bonds are fixed income securities whose principal value is periodically adjusted according to the rate of inflation. The interest rate on these bonds is generally fixed at issuance at a rate lower than typical bonds. Over the life of an inflation-indexed bond, however, interest will be paid based on a principal value which is adjusted for inflation. Any increase in the principal amount of an inflation-indexed bond will be considered interest income, even though principal is not received until maturity. Repurchase Agreements. Each Fund may engage in repurchase transactions. Under the terms of a typical repurchase agreement, the Fund takes possession of an underlying debt obligation subject to an obligation of the seller to repurchase, and the Fund to resell, the obligation at an agreed-upon price and time. The market value of the collateral must be equal at all times to the total amount of the repurchase obligations, including interest. Generally, in the event of counterparty default, the Fund has the right to use the collateral to offset losses incurred. Reverse Repurchase Agreements. Certain Funds are authorized to enter into reverse repurchase agreements. In a reverse repurchase agreement, the Fund sells to a financial institution a security that it holds with an agreement to repurchase the same security at an agreed-upon price and date. A reverse repurchase agreement involves the risk that the market value of the security sold by the Fund may decline below the repurchase price of the security. Restricted Securities. Certain Funds are permitted to invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. 3. Fees, Expenses, and Related Party Transactions Investment Advisory Fee. Pacific Investment Management Company (PIMCO) is a wholly-owned subsidiary partnership of PIMCO Advisors L.P. and serves as investment adviser (the "Adviser") to the Trust, pursuant to an investment advisory contract. The Adviser receives a monthly fee from each Fund at an annual rate based on average daily net assets of the Fund. The Advisory Fee is charged at an annual rate of 0.15% for the Money Market Fund; 0.20% for the Municipal Bond Fund; 0.40% for the Convertible and StocksPLUS Funds; 0.45% for the Emerging Markets Bond Fund; 0.50% for European Convertible and 0.25% for all other Funds. Administration Fee. PIMCO serves as administrator (the "Administrator"), and provides administrative services to the Trust for which it receives from each Fund a monthly administrative fee based on each share class' average daily net assets. The Administration Fee for the Retail Classes is charged at the annual rate of 0.35% for the Money Market, Municipal Bond, Short-Term, California Intermediate Municipal Bond, California Municipal Bond and New York Municipal Bond Funds, 0.45% for the Foreign Bond and Global Bond II Funds, 0.55% for the Emerging Markets Bond Fund and 0.40% for all other Funds. The Administration Fee for the Institutional and Administrative Classes is charged at an annual rate of 0.18% for the Low Duration and Total Return Funds, 0.20% for the Moderate Duration, Money Market and Short-Term Funds; 0.24% for the California Intermediate Municipal Bond, California Municipal Bond and New York Municipal Bond, 0.30% for the Global Bond II, 0.40% for the Emerging Markets Bond and 0.25% for all other funds. The Administration Fee for Class D is charged at the annual rate of 0.25% for Low Duration, Short-Term and Total Return Funds; 0.35% for the California Intermediate Municipal Bond, California Municipal Bond, Municipal Bond, New York Municipal Bond and Short Duration Municipal Bond Funds, 0.45% for the Foreign Bond Fund, 0.55% for Emerging Markets Bond Fund, and 0.40% for all other Funds. Strategic Balanced Fund Fees. Effective September 29, 2000, the Strategic Balanced Fund changed investment objectives to a "fund of funds" and as such does not pay any fees to PIMCO under the Trust's investment advisory agreement in return for the advisory and asset allocation services provided by PIMCO. The Fund does, however, indirectly pay its proportionate share of the advisory fees paid to PIMCO by the Underlying Funds in which the Fund invests. The Fund pays administrative fees to PIMCO at an annual rate of 0.05% based on the average daily net assets attributable in the aggregate to the Fund's Institutional Class and Administrative Class shares. The Fund also indirectly pays its proportionate share of the administrative fees charged by PIMCO to the Underlying Funds in which the Fund invests. Distribution and Servicing Fees. PIMCO Funds Distributors LLC, ("PFD"), a wholly-owned subsidiary of PIMCO Advisors L.P., serves as the distributor of the Trust's shares. 154 PIMCO Funds Annual Report | 3.31.01 The Trust is permitted to reimburse, out of the Administrative Class assets of each Fund offering Administrative Class shares in an amount up to 0.25% on an annual basis of the average daily net assets of that class, financial intermediaries that provide services in connection with the distribution of shares or administration of plans or programs that use Fund shares as their funding medium. The effective rate paid to PFD was 0.25% during the current fiscal year. Pursuant to the Distribution and Servicing Plans adopted by the Retail and D Classes of the Trust, the Trust compensates PFD or an affiliate with respect to Class D for services provided and expenses incurred in connection with assistance rendered in the sale of shares and services rendered to shareholders and for maintenance of shareholder accounts of the Retail and D Classes. The Trust paid PFD distribution and servicing fees at an effective rate as set forth below (calculated as a percentage of each Fund's average daily net assets attributable to each class): Allowable Rate ------------------ Distribution Servicing Fee (%) Fee(%) ------------------------------------------------------------------------- Class A Money Market Fund -- 0.10 All other Funds -- 0.25 Class B All Funds 0.75 0.25 Class C Municipal Bond, Real Return Bond StocksPLUS Funds and Low Duration Funds 0.50 0.25 Money Market Fund -- 0.10 Short-Term Fund 0.30 0.25 All other Funds 0.75 0.25 Class D All Funds -- 0.25 PFD also receives the proceeds of the initial sales charges paid by the shareholders upon the purchase of Class A shares, except for the Money Market Fund, and the contingent deferred sales charges paid by the shareholders upon certain redemptions of Retail Classes shares. For the period ended March 31, 2001, the funds were informed that PFD received $14,039,941 representing commissions (sales charges) and contingent deferred sales charges. Expenses. The Trust is responsible for the following expenses: (i) salaries and other compensation of any of the Trust's executive officers and employees who are not officers, directors, stockholders or employees of PIMCO or its subsidiaries or affiliates; (ii) taxes and governmental fees; (iii) brokerage fees and commissions and other portfolio transaction expenses; (iv) the costs of borrowing money, including interest expenses; (v) fees and expenses of the Trustees who are not "interested persons" of PIMCO or the Trust, and any counsel retained exclusively for their benefit; (vi) extraordinary expenses, including costs of litigation and indemnification expenses; (vii) organization expense and (viii) any expenses allocated or allocable to a specific class of shares, which include service fees payable with respect to the Administrative Class shares and may include certain other expenses as permitted by the Trust's Multiple Class Plan adopted pursuant to Rule 18f-3 under the Act and subject to review and approval by the Trustees. The ratio of expenses to average net assets per share class, as disclosed in Financial Highlights, may differ from the annual fund operating expenses per share class as disclosed in the Prospectus for the reasons set forth above. PIMCO has agreed to waive a portion of Convertible, European Convertible Bond, California Intermediate Municipal Bond, California Municipal, New York Municipal Bond and Short-Duration Municipal Funds administrative fees to the extent that the payment of each Fund's pro rata share of Trustee fees and organizational expenses cause the actual expense ratio to rise above the rates disclosed in the current prospectus plus 0.49% basis points as set forth below (calculated as a percentage of each Fund's average daily net assets attributable to each class):
Inst'l Class Admn Class Class A Class B Class C Class D ------------------------------------------------------------------------------------------ Convertible Fund 0.65% 0.90% 1.05% 1.80% 1.80% 1.05% California Intermediate Municipal Bond Fund 0.49% 0.75% 0.85% -- -- 0.85% California Municipal Bond Fund 0.49% 0.74% 0.85% -- -- 0.85% New York Municipal Bond Fund 0.49% 0.74% 0.89% -- -- 0.87% Short Duration Municipal Income Fund 0.39% 0.64% -- -- -- 0.80%
PIMCO may be reimbursed for these waived amounts in future periods. Each unaffiliated Trustee receives an annual retainer of $45,000**, plus $3,000 for each Board of Trustees meeting attended in person and $500 for each meeting attended telephonically, plus reimbursement of related expenses. In addition, each committee chair receives an annual retainer of $1,500. These expenses are allocated to the Funds of the Trust according to their respective net assets. ** Effective January 1, 2001, the annual retainer for the unaffiliated Trustee is equal to $60,000. 3.31.01 | PIMCO Funds Annual Report 155 PIMCO Notes to Financial Statements A, B, and C Classes (Cont.) March 31, 2001 4. Shares of Beneficial Interest The Trust may issue an unlimited number of shares of beneficial interest with a $.0001 par value. Changes in shares of beneficial interest were as follows (shares and amounts in thousands):
California California Intermediate Municipal Municipal Bond Fund Bond Fund ----------------------------------------------- ------------------------ Year Ended Period from 08/31/1999 Period from 05/16/2000 03/31/2001 to 03/31/2000 to 03/31/2001 Shares Amount Shares Amount Shares Amount Receipts for shares sold Class A 4,144 $ 41,939 189 $ 1,879 79 $ 809 Class B 0 0 0 0 0 0 Class C 0 0 0 0 0 0 Other Classes 11,297 114,297 887 8,860 2,107 21,146 Shares issued in reorganization Class A 0 0 0 0 0 0 Class B 0 0 0 0 0 0 Class C 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 Issued as reinvestment of distributions Class A 108 1,122 1 12 0 3 Class B 0 0 0 0 0 0 Class C 0 0 0 0 0 0 Other Classes 300 3,117 9 91 79 808 Cost of shares redeemed Class A (1,690) (17,618) (12) (119) (11) (110) Class B 0 0 0 0 0 0 Class C 0 0 0 0 0 0 Other Classes (3,998) (40,805) (56) (556) (1,031) (10,590) Net increase (decrease) resulting from Fund share transactions 10,161 $ 102,052 1,018 $ 10,167 1,223 $ 12,066 ------------------------------------------------- ----------------------------------------------- ------------------------ Convertible Fund ------------------------------------------------- Year Ended Year Ended 03/31/2001 03/31/2000 Shares Amount Shares Amount Receipts for shares sold Class A 362 $ 5,137 353 $ 4,800 Class B 408 5,738 188 2,593 Class C 826 11,544 517 6,988 Other Classes 6,630 90,634 13,296 176,122 Shares issued in reorganization Class A 0 0 0 0 Class B 0 0 0 0 Class C 0 0 0 0 Other Classes 0 0 0 0 Issued as reinvestment of distributions Class A 27 360 4 58 Class B 13 170 1 13 Class C 41 543 3 49 Other Classes 563 7,574 137 1,984 Cost of shares redeemed Class A (156) (2,198) (27) (363) Class B (83) (1,077) (24) (337) Class C (211) (2,818) (10) (141) Other Classes (12,009) (155,586) (2,763) (41,632) Net increase (decrease) resulting from Fund share transactions (3,589) $ (39,979) 11,675 $ 150,134 ------------------------------------------------- -------------------------------------------------- Long-Term U.S. Gov't Fund --------------------------------------------------- Year Ended Year Ended 03/31/2001 03/31/2000 Shares Amount Shares Amount Receipts for shares sold Class A 6,302 $ 65,435 4,070 $ 39,235 Class B 2,830 29,267 1,632 16,036 Class C 2,653 27,453 1,110 10,916 Other Classes 24,046 247,593 22,328 218,562 Shares issued in reorganization Class A 0 0 0 0 Class B 0 0 0 0 Class C 0 0 0 0 Other Classes 0 0 0 0 Issued as reinvestment of distributions Class A 202 2,067 155 1,509 Class B 96 983 137 1,334 Class C 74 751 104 1,016 Other Classes 1,443 14,726 1,356 13,146 Cost of shares redeemed Class A (3,410) (34,912) (2,749) (26,743) Class B (1,324) (13,312) (1,947) (18,920) Class C (1,517) (15,587) (2,146) (20,940) Other Classes (22,514) (234,568) (15,089) (144,47) Net increase (decrease) resulting from Fund share transactions 8,881 $ 89,896 8,961 $ 90,676 ---------------------------------------------- ---------------------------------------------------- Low Duration Fund ---------------------------------------------------- Year Ended Year Ended 03/31/2001 03/31/2000 Shares Amount Shares Amount Receipts for shares sold Class A 22,253 $ 219,648 41,997 $ 415,786 Class B 3,943 38,949 5,371 53,258 Class C 4,934 48,731 5,600 55,588 Other Classes 258,655 2,552,105 297,686 2,950,320 Shares issued in reorganization Class A 0 0 0 0 Class B 0 0 0 0 Class C 0 0 0 0 Other Classes 0 0 0 0 Issued as reinvestment of distributions Class A 1,130 11,160 1,104 10,938 Class B 251 2,484 258 2,556 Class C 436 4,310 495 4,903 Other Classes 23,288 229,997 20,984 207,600 Cost of shares redeemed Class A (20,071) (197,995) (38,065) (376,451) Class B (2,818) (27,760) (4,621) (45,716) Class C (4,762) (46,954) (5,936) (58,675) Other Classes (235,187) (2,319,594) (301,000) (2,977,974) Net increase (decrease) resulting from Fund share transactions 52,052 $ 515,081 23,873 $ 242,133 ---------------------------------------------- ----------------------------------------------------
156 PIMCO Funds Annual Report | 3.31.01
Emerging Markets Bond Fund Foreign Bond Fund --------------------------------------------- -------------------------------------------------- Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount 182 $ 1,552 23 $ 185 4,650 $ 47,003 4,628 $ 47,005 134 1,124 92 716 650 6,565 1,041 10,650 97 819 9 68 906 9,154 1,012 10,346 4,293 35,612 5,546 42,500 20,323 205,439 18,803 191,536 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 5 41 2 20 424 4,276 260 2,623 10 84 5 39 130 1,313 119 1,204 3 28 2 14 170 1,717 161 1,630 751 6,256 225 1,803 3,258 32,854 2,951 29,929 (88) (765) (11) (95) (2,291) (23,163) (2,202) (22,268) (87) (740) (14) (118) (428) (4,326) (727) (7,337) (35) (295) (12) (98) (666) (6,727) (944) (9,583) (1,652) (13,651) (3,241) (25,001) (16,157) (163,157) (29,099) (295,818) 3,613 $ 30,065 2,626 $ 20,033 10,969 $ 110,948 (3,997) $ (40,083) --------------------------------------------- -------------------------------------------------- Global Bond Fund II High Yield Fund --------------------------------------------- -------------------------------------------------- Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount 133 $ 1,250 167 $ 1,600 21,540 $ 215,973 19,896 $ 214,375 133 1,259 133 1,267 10,467 104,829 13,027 141,755 140 1,310 160 1,527 15,771 157,741 20,097 217,795 737 6,935 6,377 59,618 105,814 1,060,491 38,322 1,500,396 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 16 153 13 124 960 9,591 883 9,497 25 236 19 177 931 9,305 1,084 11,679 30 282 26 244 1,386 13,854 1,613 17,370 567 5,308 268 2,526 15,618 156,080 18,896 203,172 (105) (990) (214) (2,026) (14,202) (142,592) (16,324) (174,492) (100) (945) (160) (1,506) (7,912) (79,244) (9,920) (106,519) (186) (1,750) (221) (2,083) (12,774) (127,866) (21,279) (228,700) (3,782) (35,563) (558) (5,204) (180,099) (1,780,150) (143,149) (1,524,985) (2,392) (22,515) 6,010 $ 56,264 (42,500) $ (401,980) 23,146 $ 281,343 --------------------------------------------- -------------------------------------------------- Money Market Fund Municipal Bond Fund ------------------------------------------------------ -------------------------------------------- Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount $ 1,564,604 $ 1,564,604 5,545,908 $ 5,545,968 636 $ 6,223 750 $ 7,221 81,174 81,175 110,792 110,792 579 5,629 374 3,559 666,874 666,874 1,134,937 1,134,937 503 4,912 322 3,130 162,116 162,115 5427,835 427,835 3,184 30,520 1,009 9,608 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 2,229 2,941 2,941 11 102 22 211 0 1,015 615 615 10 96 12 112 0 4,389 3,367 3,367 80 775 98 945 0 13,305 13,305 14,433 14,434 94 911 39 370 (1,609,628) (1,609,628) (5,552,316) (5,552,316) (426) (4,055) (551) (5,201) (69,411) (69,411) (100,869) (100,869) (300) (2,900) (425) (4,031) (662,190) (662,190) (1,124,988) (1,124,988) (563) (5,444) (1,139) (10,912) (347,072) (347,072) (459,029) (459,029) (1,362) (13,085) (746) (7,109) $(192,595) $(192,595) 3,626 $ 3,627 2,446 $ 23,684 (235) $ (2,097) ------------------------------------------------------ -------------------------------------------- New York Municipal Bond Fund Real Return Bond Fund ------------------------------------------------ ---------------------------------------------- Year Ended Period from 08/31/1999 Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount 17 $ 185 1 $ 10 8,084 $ 82,016 1,210 $ 11,806 0 0 0 0 4,550 46,156 1,003 9,829 0 0 0 0 6,698 68,127 1,745 17,048 38 400 301 3,010 51,913 521,572 21,969 214,305 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 238 2,408 52 506 0 0 0 0 111 1,119 31 307 0 0 0 0 151 1,523 29 284 17 172 8 76 3,395 34,164 484 4,724 (1) (11) 0 0 (885) (8,866) (114) (1,110) 0 0 0 0 (541) (5,441) (248) (2,416) 0 0 0 0 (771) (7,743) (282) (2,761) 0 0 0 0 (13,721) (138,260) (1,517) (14,771) 71 $ 747 310 $ 3,096 59,222 $ 596,775 24,362 $ 237,751 ---------------------------------------------- --------------------------------------------
3.31.01 | PIMCO Funds Annual Report 157 PIMCO Notes to Financial Statements A, B, and C Classes (Cont.) March 31, 2001 Shares of Beneficial Interest (cont.) The Trust may issue an unlimited number of shares of beneficial interest with a $.0001 par value. Changes in shares of beneficial interest were as follows (shares and amounts in thousands):
Short-Term Fund StocksPLUS Fund --------------------------------------------- ------------------------------------------ Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount Receipts for shares sold Class A 9,080 $ 90,544 10,292 $ 102,581 8,726 $ 114,951 15,869 $ 225,386 Class B 503 5,009 844 8,403 3,507 44,932 10,113 145,530 Class C 1,711 17,069 2,301 22,931 3,337 42,342 9,655 139,471 Other Classes 57,226 571,111 122,851 1,224,707 16,726 213,063 19,592 284,609 Shares issued in reorganization Class A 0 0 0 0 0 0 0 0 Class B 0 0 0 0 0 0 0 0 Class C 0 0 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 0 0 Issued as reinvestment of distributions Class A 355 3,540 387 3,855 808 9,885 1,987 27,851 Class B 23 234 18 180 1,643 19,868 3,929 54,645 Class C 47 468 74 737 1,577 19,135 3,630 50,658 Other Classes 2,919 29,138 2,242 22,331 3,985 49,296 7,615 107,331 Cost of shares redeemed Class A (8,632) (86,081) (11,127) (110,878) (10,253) (132,114) (16,833) (240,512) Class B (505) (5,037) (569) (5,669) (7,828) (99,474) (7,092) (99,404) Class C (1,271) (12,670) (2,026) (20,188) (6,464) (82,398) (8,227) (114,424) Other Classes (67,797) (676,498) (114,031) (1,136,901) (21,844) (280,102) (17,802) (255,850) Net increase (decrease) resulting from Fund share transactions (6,341) $ (63,173) 11,256 $ 112,089 (6,080) $ (80,616) 22,436 $ 325,291 --------------------------------------- --------------------------------------------- ----------------------------------------- Strategic Balanced Fund ------------------------------------------------ Year Ended Year Ended 03/31/2001 03/31/2000 Shares Amount Shares Amount Receipts for shares sold Class A 113 $ 1,366 118 $ 2,703 Class B 103 1,205 231 4,146 Class C 548 6,349 346 5,532 Other Classes 388 4,620 964 9,120 Shares issued in reorganization Class A 0 0 629 8,167 Class B 0 0 862 11,192 Class C 0 0 888 11,513 Other Classes 0 0 2,758 35,908 Issued as reinvestment of distributions Class A 31 362 26 336 Class B 68 784 64 821 Class C 94 1,030 70 893 Other Classes 502 5,829 556 7,151 Cost of shares redeemed Class A (144) (1,761) (422) (5,306) Class B (267) (3,157) (245) (3,077) Class C (325) (3,895) (271) (3,424) Other Classes (6,100) (77,433) (2,135) (27,359) Net increase (decrease) resulting from Fund share transactions (4,989) $ (64,701) 4,439 $ 58,316 -------------------------------------------- ------------------------------------------------ Total Return Fund Total Return Mortgage Fund ------------------------------------------------- ---------------------------------- Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount Receipts for shares sold Class A 172,063 $ 1,764,570 149,542 $ 1,506,055 110 $ 1,132 0 $ 0 Class B 37,206 382,832 27,995 282,282 84 865 0 0 Class C 47,953 493,040 30,951 312,021 214 2,205 0 0 Other Classes 1,343,263 13,706,067 1,136,65 11,402,013 2,031 20,314 23 227 Shares issued in reorganization Class A 0 0 0 0 0 0 0 0 Class B 0 0 0 0 0 0 0 0 Class C 0 0 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 0 0 Issued as reinvestment of distributions Class A 6,538 66,764 7,532 75,662 1 14 0 0 Class B 2,087 21,289 2,180 21,883 1 11 0 0 Class C 2,541 25,930 2,746 27,579 4 41 0 0 Other Classes 170,440 1,737,051 128,626 1,288,826 128 1,308 25 240 Cost of shares redeemed Class A (83,133) (848,932) (71,628) (716,288) (37) (384) 0 0 Class B (12,202) (123,611) (17,534) (175,145) (7) (68) 0 0 Class C (17,882) (180,906) (30,415) (304,175) (35) (363) 0 0 Other Classes (794,516) (8,092,604) (721,663) (7,223,440) (505) (5,181) (55) (554) Net increase (decrease) resulting from Fund share transactions 874,358 $ 8,951,490 644,982 $ 6,497,273 1,989 $19,894 (7) $ (87) ------------------------------------------ ------------------------------------------------- ----------------------------------
158 PIMCO Funds Annual Report | 3.31.01 5. Purchases and Sales of Securities Purchases and sales of securities (excluding short-term investments) for the period ended March 31, 2001 were as follows (amounts in thousands): U.S. Government/Agency All Other ----------------------- ----------------------- Purchases Sales Purchases Sales -------------------------------------------------------------------------------- California Intermediate Municipal Bond Fund $ 108 $ 0 $ 49,465 $ 38,049 California Municipal Bond Fund 218 0 327,131 238,379 Convertible Fund 0 0 306,691 337,797 Emerging Markets Bond Fund 0 0 430,286 410,116 Foreign Bond Fund 2,889,041 2,885,954 1,374,920 1,157,516 Global Bond Fund II 351,826 368,896 208,602 174,075 High Yield Fund 0 0 1,404,633 1,942,746 Long-Term U.S. Government Fund 6,836,016 6,798,278 91,885 24,440 Low Duration Fund 20,847,584 18,096,892 2,684,950 1,693,694 Municipal Bond Fund 108 0 218,600 193,470 New York Municipal Bond Fund 0 0 32,246 31,733 Real Return Bond Fund 2,672,335 2,007,218 592,915 86,773 Short-Term Fund 1,098,486 721,233 534,843 255,803 StocksPLUS Fund 3,196,677 2,697,059 707,315 830,795 Strategic Balanced Fund 457,515 496,733 130,468 151,976 Total Return Fund 222,602,527 197,986,156 24,585,355 29,666,864 Total Return Mortgage Fund 191,474 166,061 8,458 1,769 6. Acquisition by Allianz AG On May 5, 2000, Allianz AG completed the acquisition of approximately 70% of the outstanding partnership interest in PIMCO Advisors L.P. ("PIMCO Advisors"), of which PIMCO is a subsidiary partnership. As a result of this transaction, PIMCO Advisors, and its subsidiaries, are now controlled by Allianz AG, a leading provider of financial services, particularly in Europe. PIMCO remains operationally independent, continues to operate under its existing name, and now leads the global fixed-income efforts of Allianz AG. Key employees at each PIMCO Advisors' investment units, including PIMCO's Bill Gross, have signed long-term employment contracts and have significant profit-sharing and retention arrangements to ensure continuity of the investment process and staff. The Allianz Group manages assets of approximately 713.3 billion as of December 31, 2000, including more than 300 mutual funds for retail and institutional clients around the world. 7. In-Kind Transactions For the period ended March 31, 2001, the following funds realized gains or losses from in-kind redemptions of approximately (amounts in thousands): Realized Gains Realized Losses -------------------------------------------------------------------- High Yield Fund $ 0 $ (70,521) Strategic Balanced Fund 59 0 8. Reorganization The Acquiring Fund, as listed below, acquired the assets and certain liabilities of the Acquired Fund, also listed below, in a tax-free exchange for shares of the Acquiring Fund, pursuant to a plan of reorganization approved by the Acquired Fund's shareholders (amounts in thousands):
Value of Total Net Shares Shares Total Net Total Net Assets of Acquired Issued by Issued by Assets of Assets of Acquiring Fund's Acquiring Acquiring Acquired Acquiring Fund After Unrealized Acquiring Fund Acquired Fund Date Fund Fund Fund Fund Acquisition Depreciation ------------------------------------------------------------------------------------------------------------------------------------ PIMCO PIMCO Strategic Balanced Fund Balanced Fund 09/17/1999 5,137 $ 66,780 $ 66,780 $105,993 $ 172,774 $ (45)
3.31.01 | PIMCO Funds Annual Report 159 PIMCO Notes to Financial Statements A, B, and C Classes (Cont.) March 31, 2001 9. Transactions in Written Call and Put Options. Transactions in written call and put options were as follows (amounts in thousands):
Long-Term Strategic Foreign Global Bond U.S. Gov't Low Duration StocksPLUS Balanced Total Return Bond Fund Fund II Fund Fund Fund Fund Fund ------------------------------------------------------------------------------------------------------------------------------------ Premium ------------------------------------------------------------------------------------------------------------------------------------ Balance at 03/31/2000 $ 473 $ 40 $ 579 $ 3,873 $ 1,231 $ 692 $ 31,722 Sales 1,986 258 4,925 3,939 9,853 643 53,504 Closing Buys (424) (66) (4,137) (361) 3,255 (275) (29,554) Expirations (1,329) (175) (736) (3,597) (13,583) (1,060) (18,184) Exercised (10) (1) 0 (2,032) 0 0 (215) ------------------------------------------------------------------------------------------------------------------------------------ Balance at 03/31/2001 $ 696 $ 56 $ 631 $ 1,822 $ 756 $ 0 $ 37,273 ------------------------------------------------------------------------------------------------------------------------------------
10. Federal Income Tax Matters As of March 31, 2001, the Funds listed in the table below had remaining capital loss carryforwards that were realized or acquired in prior years. Use of the acquired capital loss carryforwards may be limited under current tax laws. Additionally, the California Intermediate Municipal Bond, Convertible, Foreign Bond, Global Bond II, High Yield, Low Duration, Real Return, Short-Term, StocksPLUS and Total Return Funds realized capital losses and/or foreign currency losses during the period November 1, 2000 through March 31, 2001 which the Funds elected to defer to the following fiscal year pursuant to income tax regulations. The amounts are $75,517, $5,480,569, $7,607,826, $1,281,094, $57,057,816, $11,492,366, $243,361, $721,218, $214,462,097, $17,936,702, respectively. Each Fund will resume capital gain distributions in the future to the extent gains are realized in excess of the available carryforwards. Capital Loss Carryforwards -------------------------------------------- Realized Acquired Losses Losses Expiration ------------------------------------------------------------------------------ High Yield Fund $ 150,615,064 $ 0 3/31/2009 High Yield Fund 39,492,722 0 3/31/2008 High Yield Fund 0 48,559,227 3/31/2003 Long-Term U.S. Government Fund 4,671,320 0 3/31/2008 Low Duration Fund 36,222,381 0 3/31/2008 Short-Term Fund 326,974 0 3/31/2009 Short-Term Fund 412,413 0 3/31/2008 Short-Term Fund 109,956 0 3/31/2007 StocksPLUS Fund 86,222,244 0 3/31/2009 Strategic Balanced Fund 1,711,676 0 3/31/2009 Convertible Fund 3,488,828 0 3/31/2009 160 PIMCO Funds Annual Report | 3.31.01 PIMCO Report of Independent Accountants A, B, and C Classes To the Trustees and Class A, Class B and Class C Shareholders of the PIMCO Funds: Pacific Investment Management Series In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations, of changes in net assets and of cash flows and the financial highlights for the Class A, Class B and Class C shares present fairly, in all material respects, the financial position of the California Intermediate Municipal Bond Fund, California Municipal Bond Fund, Convertible Fund, Emerging Markets Bond Fund, Foreign Bond Fund, Global Bond Fund II, High Yield Fund, Long-Term U.S. Government Fund, Low Duration Fund, Money Market Fund, Municipal Bond Fund, New York Municipal Bond Fund, Real Return Bond Fund, Short-Term Fund, StocksPLUS Fund, Strategic Balanced Fund, Total Return Fund, and Total Return Mortgage Fund (hereafter referred to as the "Funds") at March 31, 2001, the results of each of their operations, the changes in each of their net assets and cash flows for the Long-Term U.S. Government Fund, Foreign Bond Fund, Global Bond Fund II, Short-Term Fund and Real Return Bond Fund and the financial highlights for the Class A, Class B and Class C shares for each of the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Funds' management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with auditing standards generally accepted in the United States of America which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at March 31, 2001 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion. PricewaterhouseCoopers LLP Kansas City, Missouri May 23, 2001 3.31.01 | PIMCO Funds Annual Report 161 Federal Income Tax Information (unaudited) As required by the Internal Revenue Code regulations, shareholders must be notified within 60 days of the Trust's fiscal year end (March 31, 2001) regarding the status of the dividend received deduction for corporations. Dividend Received Deduction. Corporate shareholders are generally entitled to take the dividend received deduction on the portion of a Fund's dividend distribution that qualifies under tax law. The percentage of the following Fund's fiscal 2001 ordinary income dividends that qualifies for the corporate dividend received deduction is set forth below: Convertible Fund 17.46% European Convertible Fund 0.96% Foreign Bond Fund 0.41% Global Bond Fund II 0.40% High Yield Fund 2.99% Low Duration Fund 2.55% StocksPLUS Fund 15.77% Strategic Balanced Fund 7.48% Total Return Fund 1.22% For the benefit of shareholders of the California Municipal Bond, California Intermediate Municipal Bond, Municipal Bond, Short Duration Municipal Income, and New York Municipal Bond Funds, this is to inform you that 100.00%, 100.00%, 100.00%, 97.83%, and 100.00%, respectively, of the dividends paid by the Funds during its fiscal year qualify as exempt-interest dividends. Shareholders are advised to consult their own tax advisor with respect to the tax consequences of their investment in the Trust. In January 2002, you will be advised on IRS Form 1099-DIV as to the federal tax status of the dividends and distributions received by you in calendar year 2001. 162 PIMCO Funds Annual Report | 3.31.01 PIMCO Funds: Pacific Investment Management Series Manager Pacific Investment Management Company, 840 Newport Center Drive, Suite 300, Newport Beach, CA 92660 Distributor PIMCO Funds Distributors LLC, 2187 Atlantic Street, Stamford, CT 06902 Custodian State Street Bank & Trust Co., 801 Pennsylvania, Kansas City, MO 64105 Shareholder PFPC Global Fund Services, Inc., P.O. Box 9688, Providence, RI 02940-9688 Servicing Agent and Transfer Agent Independent PricewaterhouseCoopers LLP, 1055 Broadway, Kansas City, MO 64105 Accountant Legal Counsel Dechert, 1775 Eye Street, Washington, DC 20006 For Account For PIMCO Funds account information contact your financial advisor, or if you receive account statements Information directly from PIMCO Funds, you can also call 1-800-426-0107. Telephone representatives are available Monday-Friday 8:30 am to 8:00 pm Eastern Time.
3.31.01 | PIMCO Funds Annual Report 163 HOW TO CONTACT US For information regarding your investment contact your financial advisor, or call: Shareholder Services 1-800-426-0107 For general information: 1-888-87-PIMCO PIMCO Funds Online www.pimcofunds.com Access Staff Editor Ruth Straughn Design Wendy Berge What do you think? To provide feedback on access, e-mail us at: accessmag@pimcofunds.com. Or write to: PIMCO Funds, 2187 Atlantic Street, Stamford, CT 06902, Attention: Access Editor. PIMCO Funds offers access to the specialized investment expertise of PIMCO Advisors L.P. (PIMCO). PIMCO manages over $270 billion and has a client list that includes 63 of the 100 largest U.S. corporations. The firm is a member of the Allianz Group, one of the world's leading financial services providers. Stock Funds Bond Funds ---------------------------------- -------------------------------- Growth Short Duration Growth Fund Short-Term Fund Select Growth Fund Low Duration Fund Target Fund Opportunity Fund Intermediate Duration Total Return Fund Blend Total Return Mortgage Fund Growth & Income Fund Capital Appreciation Fund Long Duration Mid-Cap Fund Long-Term U.S. Government Fund Value Tax-Exempt Renaissance Fund Municipal Bond Fund Value Fund CA Interm. Municipal Bond Fund Small-Cap Value Fund NY Municipal Bond Fund CA Municipal Bond Fund Enhanced Index Tax-Efficient Equity Fund Inflation-Indexed StocksPLUS Fund Real Return Bond Fund International International Select International Fund Global Bond Fund II Foreign Bond Fund Sector-Related Emerging Markets Bond Fund Innovation Fund Global Innovation Fund High Yield Healthcare Innovation Fund High Yield Fund Convertible Stock and Bond Funds Convertible Fund --------------------------------- Strategic Balanced Fund Asset Allocation Series 90/10 Portfolio 60/40 Portfolio 30/70 Portfolio (C) 2001 PIMCO Funds Distributors, LLC This material is authorized for use only when preceded or accompanied by a current PIMCO Funds prospectus, which describes in greater detail the investment policies, management fees and other matters of interest to prospective investors. Please read the prospectus carefully before you invest or send money. Although carefully verified, data is not guaranteed as to accuracy or completeness. PIMCO Funds can not be held responsible for any loss incurred by applying any information in this publication. Shareholder Communications Now Available Online [GRAPHIC] PIMCO Funds is pleased to announce that you can now elect to receive your shareholder communications online. This new service, called eDelivery, allows you to access annual and semi-annual reports, prospectuses and proxy statements through the Internet--eliminating the paper mailings you've received in the past. Why sign up? eDelivery provides you with several important benefits, including: . Faster delivery than regular mail . Convenient access to valuable information . Environmentally sound. [GRAPHIC] How it works To sign up for eDelivery, go to www.pimcofunds.com/edelivery and complete the short enrollment form. As communications become available, we will send you an e-mail notification containing the Internet address where you can view and print the materials. For more information on this valuable new service, turn to page 5 in this magazine. PZ003.4/01 -------------------------------------------------------------------------------- www.pimcofunds.com -------------------------------------------------------------------------------- ------------- PRSRT STD PIMCO U.S. POSTAGE FUNDS PAID N.READING, MA PERMIT #105 PIMCO Funds ------------- Distributors LLC 2187 Atlantic Street Stamford, CT 06902-6896 A Quarterly Publication from PIMCO Funds SPRING 2001 access Fixed Income Manager of the Year. [PHOTO] Again. How Bill Gross and PIMCO became Morningstar's only two-time winner. 5 Go paperless |6 Gross & McCulley|9 Six time-tested |Inside: PIMCO Funds with eDelivery| talk shop | investment principles|Annual Report [LOGO OF PIMCO FUNDS] Access to the highest standard Encore! They did it again. This January, Bill Gross and the PIMCO bond team were named Morningstar's 2000 Fixed Income Fund Manager of the Year--making them the only repeat winner in the awards' 14 year history. What sets your bond managers apart from the pack? Here's the story. They're like the Oscars of the mutual fund world. Each January, Morningstar bestows its Manager of the Year awards, honoring those in three categories--domestic stock, international stock and fixed income--who "demonstrate excellent investment skill and the courage to differ from consensus." Oustanding performance in a given year is a leading criterion, but not enough to win. Recipients must also boast an exceptional long-term record. In fixed income last year, all roads led to Bill Gross and PIMCO. "Gross and his team hit on all cylinders in 2000, while steering clear of a bond market full of land mines," states Morningstar. They go on to cite that over the past 10 years, PIMCO's flagship Total Return Fund has outpaced the overall bond market (as represented by the Lehman Brothers Aggregate Bond Index) by a substantial margin. A LEADING ROLE PIMCO's winning bond management formula took root more than 25 years ago, when Gross helped pioneer a total return approach to bond investing--one that focused on income plus capital appreciation, rather than income alone. Today, it's the backbone of PIMCO's bond portfolios. Yet a total return approach to fixed income has since achieved widespread acceptance. " Two simple concepts--secular forecasting and innovation--are the reasons why PIMCO remains at the top of its field in the bond arena." --Bill Gross So when it comes to PIMCO's enduring success, there are clearly additional factors at work. One of the most significant is a drive for innovation. Gross's progressive, often contrarian mindset has become firmly embedded in the PIMCO bond culture. It's what led the team to invest early on in a number of breakthrough bond instruments: mortgage-backed securities in the 1970s, financial futures in the 1980s, and TIPS (Treasury Inflation-Protected Securities) in the late 1990s, to name a few. That's not to say that PIMCO is always looking to be first out of the gate. They sat out on the 80s junk bond craze, for example, waiting until the dust settled to form their sector strategy--a relatively conservative one. SETTING THE STAGE Further distinguishing PIMCO's bond management is its big-picture platform. The team gathers every May for a three-day Secular Forum to address the longer-term issues facing the bond market and the economy. To encourage out-of-the box thinking, PIMCO invites key outsiders to join in the discussion, including top academics and chiefs of industry. The forum culminates in the creation of a three- to five-year outlook, which serves as a guiding light for the PIMCO bond team. A LITTLE IMPROV Still, given even the most visionary top-down strategy, outperforming in the bond world is usually the result of making several small but savvy moves. For Gross and company, such decisions are not an exact science. "I've experimented over time with models and statistical 2 access | Spring 2001 "Because Gross won the award two years ago, we'd have preferred someone else, but no one really came close." -Morningstar 1/01 methodologies," Gross once said in an interview with Worth magazine. "I find that the minute it looks like I have a successful model or discipline, that's about the time it collapses." Rather, the PIMCO team employs a number of "value-adding" strategies, which range from yield curve positioning to cost-effective trading, shifting their emphasis as economic conditions demand. State-of-the-art analytical capabilities also play a pivotal role. "Our enthusiastic embrace of technology nearly 20 years ago paved the way for additional performance throughout those years," Gross observes. Today, a hefty, ongoing investment in technology--much of it proprietary--continues to give the team a leg up on the competition. GREAT DIALOGUE It's significant to note that although Morningstar's Manager of the Year Awards are typically given to specific individuals, in this case the honor was extended to Bill Gross and the PIMCO bond team. And Gross himself is adamant about crediting his colleagues, collectively, for PIMCO's success. That's because there's a 138-person team powering PIMCO's bond management prowess. While individual managers head up specific funds, they all participate in setting PIMCO's strategic direction. Ultimately, it's the pooling of talents--the "best of the best" from various bond market disciplines--that makes for a winning combination. . Bill Gross at Your Fingertips Want to find out what Bill Gross and his colleagues are thinking now? Visit the PIMCO Funds Bond Center at www.pimcofunds.com/bondcenter. You'll find timely commentaries from your fund manager as well as other members of the PIMCO bond team. Past performance is no guarantee of future results. The Morningstar Fund Manager of the Year Award winners are chosen based upon Morningstar's own research and in-depth evaluation by its senior editorial staff. Average annual total return measures performance assuming that all dividend and capital gain distributions were reinvested. For the 1-, 5- & 10-year periods, Total Return A at NAV returned 12.27%, 7.81% & 8.62%; Total Return A w/4.5% maximum initial sales charge returned 7.22%, 6.83% & 8.12%; and Lehman Aggregate Bond Index returned 12.53%, 7.48% & 7.98%, respectively. The Lehman Aggregate Bond Index is generally considered to be representative of the bond market in general and it is not possible to invest directly in it. Bill Gross and team at PIMCO's Newport Beach, CA trading floor. [PHOTO] online update www.pimcofunds.com for Timely Market Commentary Increased market volatility has many investors concerned. If you are looking for expert analysis on what it all means, turn to PIMCO Funds Online. Last year we redesigned the PIMCO Funds Web site (www.pimcofunds.com) in order to provide you with more commentary from our investment professionals. Consider how our site's content might help you make sense of today's investment environment. DAILY MANAGER COMMENTARY End-of-day reports from PIMCO's fund managers covering everything from economic outlooks, to investment strategies, to breaking news analysis. BOND CENTER The latest information on the economy and the bond market from PIMCO's renowned fixed-income experts. You'll find manager newsletters and interviews, a comprehensive bond investing glossary, sector strategy white papers and more. INNOVATION CENTER Up-to-date market intelligence and commentary on the tech sector from PIMCO's specialists. Included in this section is "PIMCO's Theme Approach to Tech Investing," which evaluates eight key industries driving the sector. FUND INFORMATION The definitive story on each PIMCO Fund. In addition to in-depth performance data, each fund profile includes an overview, statistics at a glance, ratings and rankings, portfolio analysis, manager commentary, investment process, media highlights, and related literature. Virtual Stuff PIMCO Renaissance Fund--a multi-cap value fund-- has been benefiting from the recent boom in value investing... not to mention some savvy moves by portfolio manager John Schneider. Now you can read all about his winning approach to the sector at www.pimcofunds.com. To download Bringing Value to Light, an in-depth profile on Schneider, just follow these simple steps: 1. From our Home page (www.pimcofunds.com) click on "Fund Information" 2. Select "Renaissance Fund" 3. Click on the "Literature" tab 4. Under Manager Profiles, select "John Schneider Profile". [PHOTO] Past performance is no guarantee of future results. Investment return will fluctuate and the value of an investor's shares will fluctuate and may be worth more or less than original cost when redeemed. The fund may invest up to 15% in foreign securities, which may entail greater risk due to foreign economic and political developments. This article will contain the current opinion of the manager and does not represent a recommendation of any particular security, strategy or investment product. Such opinions are subject to change without notice. This article is distributed for educational purposes and should not be considered investment advice. Go Paperless with eDelivery PIMCO Funds Online is proud to introduce its new eDelivery service. eDelivery is the electronic transmission of shareholder communications to you online--eliminating the paper mailings you've gotten in the past. [PHOTO] HERE'S HOW IT WORKS When you sign up for eDelivery, you'll receive shareholder communications--including annual and semi-annual reports, prospectuses, proxy statements and newsletters--via the Internet. As materials become available, we'll send you an e-mail notification containing the Internet address (URL) where you can view and print the material. Please note that in order to eliminate paper mailings from being sent to your home, each person in your household must enroll separately. BENEFITS TO SHAREHOLDERS There are several compelling reasons to sign up for eDelivery. For example, the service is a faster and more convenient way to receive your shareholder communications. In addition, it is environmentally sound. And of course, it helps eliminate mailbox clutter! FREE SERVICE There is no charge for PIMCO Funds eDelivery. However, you may incur charges from Internet service providers and telephone companies while accessing the Internet. PRIVACY PROTECTION Rest assured that PIMCO considers customer privacy to be a fundamental aspect of our relationship with shareholders. Along these lines, we have developed policies to safeguard any personal information you provide to us, while allowing us to service your account professionally and responsively. Be sure to review our complete privacy policy when you enroll for eDelivery. NEXT STEPS To start enjoying the convenience of receiving shareholder communications online, follow these simple steps... . Sign up Complete the short eDelivery Enrollment Form, which outlines the complete terms and conditions of the service, by going to www.pimcofunds.com/edelivery. Remember, each account holder in your household must enroll separately. We will e-mail you a confirmation when we receive your Form. . Watch for notification Your participation in eDelivery will begin with the next quarterly cycle after you enroll. As soon as communications are accessible, we will e-mail you a notification with the Internet address where you can view and print the communications. . Discontinuing service Enrollment in eDelivery has no expiration date. If you change your mind, however, and would like to cancel your enrollment, simply go to www.pimcofunds.com/edelivery and click on the "change/cancel" link. The Web site articles will contain the current opinions of the managers and do not represent a recommendation of any particular security, strategy or investment product. Such opinions are subject to change without notice. Articles are distributed for educational purposes and should not be considered investment advice. Information regarding any fees and expenses may be obtained by calling 1-888-87-PIMCO. Please contact your financial advisor for any questions you might have relating to the PIMCO Funds and as always read the prospectus carefully before investing or sending money. Spring 2001 | access 5 The Big Picture [GRAPHIC] PIMCO's Bill Gross and Paul McCulley discuss the economy and financial markets [PHOTO] Bill Gross [PHOTO] Paul McCulley Widely regarded as America's most influential authority on the bond market, Bill Gross is the portfolio manager of PIMCO Total Return Fund--the country's largest bond fund.* Paul McCulley is an economist, monetary policy specialist, and a managing director of PIMCO. Q What's been happening with the economy recently? Bill: On a cyclical basis, we're a classic inventory correction and the resulting contraction in the manufacturing and technology sectors. There are also several long-term excesses unraveling simultaneously, in particular, the deflating bubbles consumer spending, investment and borrowing. They were self- reinforcing on the way up, and they're now a vicious cycle on the way down. Combine that with the dramatic rise in layoffs and surging unemployment claims, and the result is falling consumer confidence levels. And in a consumption- driven economy like ours, consumer confidence is vital. Q Do you see the economy rebounding anytime soon? Paul: I think we'll be mired in a recession until late in the year. Things will start to turn around once the current inventory correction runs its course, but a big bounce for the economy after that is unlikely due to restrained consumption. It looks more like we'll have a recovery with GDP growth of perhaps 2 or 3%. Q Why won't consumer spending snap back? Bill: Right now, consumer confidence is on the decline and real personal wealth in the U.S. has plunged along with equity market prices. We're also looking at a negative personal savings rate, stimulated by years of excess consumption beyond the average consumer's means. This combination makes it likely that debt-laden and increasingly anxious consumers will start saving again--reliquifying, if you will--in turn holding back the rate of consumption and the economy relative to the last several years. Q How is the Fed likely to respond? Paul: The Fed has already made several interest rate cuts since the beginning of the year, and we believe it will continue to ease aggressively. We think the Fed funds target rate needs to fall to at least 4%, but the longer the Fed waits to get to that target, the less effective the cuts will be and the deeper they'll have to go. In our view it is imperative for the Fed to reverse the downward trend in confidence at both the business and consumer levels. This would encourage risk capital to return to the financial markets. Q Is monetary policy alone going to bring a recovery? Paul: Certainly, slashing interest rates, which fosters new debt creation, can help. But I don't believe that Fed easing alone will be enough to generate a healthy recovery. We also need new fiscal policy in the form of an aggressive tax cut to transfer the government's surplus back into the private sector. Tax cuts put money in consumers' pockets and should alleviate some of the pressure they're feeling today. I also think the tax cut we need now should be aimed at the "average" American wage earner. It should be retroactive, and the bulk of it should go into effect in the near term. 6 access | Spring 2001 Q What's going on overseas? Paul: We expect global growth to continue to decelerate. The slow down in Europe will be less severe than in the U.S., since consumer confidence should hold up and real incomes will get a boost from tax reductions. Inflation is contained, which gives the European Central Bank room to ease. We remain fairly negative on Japan. Its economy should continue to weaken. Consumer confidence remains low despite huge fiscal stimulus packages that have swelled public debt, while still more public spending will be needed to support Japan's ailing banks. The government is meanwhile taking a "go-slow" approach to fixing the banking system, which isn't helping matters. Q Where do you see value in the bond market today? Bill: We'll continue to focus on higher quality, longer duration investments. Most of our higher-quality exposure will come from mortgage-backed securities, as the Treasury market has fully priced in the effects of further Fed easing. Where possible, we intend to keep duration above-benchmark as current monetary policy effectively caps long-term interest rates. While we remain defensive in high yield, we may look to take advantage of select opportunities in the corporate sector as signs of a recovery emerge. In the current environment, core European bonds offer compelling value because the yields offered don't fully price in the anticipated slowdown in the region. Yields on the short end are particularly attractive because of anticipated easing by the European Central Bank. Although our long position on the Euro has not been positive, we think it will gain in value given the current weakness in the U.S. Q Finally, Bill, what about the long-term prospects for the financial markets? Bill: I think we're at an important juncture in the economy that's pointing toward lower corporate profits and a swing back to long-run historical return averages for the financial markets over the next several years. That means something along the lines of 6-7% returns for bonds and 8-9% for stocks. In terms of structural influences on the economy, "New Age" technology and globalization trends have accelerated competition --a positive development for the consumer due to lower inflation but a negative one for U.S. corporate profit margins. You also have to consider the reverse-wealth effect I alluded to earlier. Greater savings mean less overall consumption and less economic activity, so . Monthly on the Web Each month, Bill Gross and Paul McCulley offer their insights on the economy and the markets. Be sure to check out their newsletters, Investment Outlook and Fed Focus, online at www.pimcofunds.com. the days of 5-6% GDP growth are likely to turn into 2-3% this decade, which will keep the financial markets from growing at the pace we've seen over the last several years. There's also a demographic shift underway, with the boomer generation beginning to move out of stocks and into fixed income. This marginal decline in demand won't help equity prices and, with relatively low interest rates holding sway, total returns for fixed income are also limited. In short, we're entering an era of diminished expectations, and investors would be wise to plan for their long-term financial needs with this reality in mind. Since the personal savings rate in the U.S. is so low, it means the economy isn't likely to get a boost from consumers any time soon. Personal savings as a percentage of disposable income. [GRAPH] PIMCO Funds: Pacific Investment Management Series Annual Report dated March 31, 2001 The line graph inserted at the top of page 7 in the section "Economic Outlook" is entitled "Personal Savings as a percentage of disposable income" and illustrates the fact that personal savings are declining. The graph shows one line representing the 3-month moving average (%) of personal savings over the period from mid-1987 through mid-2000. Source: Goldman Sachs. * Source: net assets by Simfund as of 3/31/01. Past performance is no guarantee of future results. The views of Mr. Gross and Mr. McCulley are not indicative of the past or future performance of any PIMCO Funds. These charts are not indicative of the past or future performance of any PIMCO Fund. There is no guarantee that these or any other investment techniques will be effective under all market conditions. Please see the prospectus for more complete information on the PIMCO Total Return Fund & Real Return Bond Fund. Spring 2001 | access 7 Quick takes What's happening at PIMCO? Read on for the latest news from PIMCO Funds, including media highlights, fund updates, company announcements and more. BOND SMARTS The unparalleled leadership PIMCO has in the fixed-income marketplace was detailed in this November 2000 Mutual Funds magazine article. As part of the piece, Bill Gross and his portfolio management team, including Paul McCulley, were highlighted for their accurate interest rate calls and index-beating performance. The article goes as far as saying, "pension fund managers, financial advisors, and individual investors regard investing in PIMCO's roster of 15 domestic and international bond funds as a foregone conclusion." [GRAPHIC] [GRAPHIC] TURNING VALUE INTO A GOLD MINE This December 18th Business Week article on John Schneider, manager of PIMCO Value and PIMCO Renaissance Funds, reports that he was "right in the market's sweet spot this year." In the piece, Mr. Schneider discusses his value investing philosophy, his strategy for the year and his outlook for various sectors of the stock market. . Keep current at www.pimocofunds.com To get the latest updates from PIMCO, be sure to check out the News column on our Home page. There, we'll post breaking PIMCO news, including any important announcements related to your investment. PIMCO TOTAL RETURN IS AMERICA'S BEST-SELLING MUTUAL FUND According to industry reports, PIMCO Total Return Fund was the country's best-selling mutual fund in the first quarter of 2000. As Reuters stated (4/26/01), "...the $38 billion king of bond funds, the PIMCO Total Return Fund, outsold all other stock and bond funds for the three consecutive months--a rare occurrence in the mutual fund industry." WSJ CHANGES FUND LISTING CRITERIA If you're perusing the mutual fund tables in the Wall Street Journal and no longer find a PIMCO Fund listed--don't worry! The newspaper recently decided to reduce the number of mutual fund prices it publishes. Now, only funds with $50 million or more in assets are listed. With over 12,000 active mutual funds in the U.S. marketplace (Morningstar, 3/31/01), it's easy to understand why they can't print them all! Remember, daily pricing for all PIMCO Funds is always available through our Web site, www.pimco-funds.com. Or, you can contact your financial advisor. Certain products & services may not be offered at certain broker/dealers. The opinions expressed in the articles mentioned will contain the current opinions of the managers and do not represent a recommendation of any particular security, strategy or investment product. Such opinions are subject to change without notice. These articles are distributed for educational purposes and should not be considered investment advice. The average annual total return measures performance assuming that all dividend and capital gain distributions were reinvested. "Best-selling mutual fund" based on new net flows calculated by Simfund as of 3/31/01. 8 access | Spring 2001 Six Tried-and-True Principles for Any Investor Having a firm grasp of some investing fundamentals can help you set realistic goals and stick to your financial plan. The professionals at PIMCO Funds have compiled the following set of time-tested investment principles, which they themselves adhere to. Review them with your financial advisor, who can help you establish your own, personal investment approach. 1 KEEP A LONG-TERM VIEW Keep in mind the historical returns of stocks and bonds (about 11.0% and 5.7%, respectively) when setting your financial goals. Treat any outperformance as a bonus. Remember--time is your ally! By focusing on long-term results, you'll find it easier to ride out short-term volatility. 2 BE DISCIPLINED Often the most successful portfolio managers are those that follow a proven investment process. The key is that they choose an investment discipline and adhere to it. By establishing a clear financial plan, you'll have a logical framework for your own financial decisions. 3 INVEST RESPONSIBLY Define your objectives and risk tolerance and consider them hard and fast parameters. While making big bets can sometimes reap big rewards, they often lead to steep losses instead. That's why many top portfolio managers, like those at PIMCO, look to optimize the balance between risk and reward. 4 UNDERSTAND WHAT YOU INVEST IN If you can't explain in simple terms why you're investing in a particular security, you should rethink the investment. And you should always have a clear understanding of any risks involved. Your financial advisor should prove an invaluable resource along these lines. 5 STAY DIVERSIFIED No one can predict the next top-performing asset class. That's why the importance of asset allocation is virtually undisputed. To achieve broad diversification, you should invest your assets across different sectors and industries as well as different asset classes. Remember to periodically rebalance to ensure the proper mix. [PHOTO] 6 KNOW THE VALUE OF PROFESSIONAL ADVICE A more challenging investment climate has dissuaded many investors from trying to go it alone. That's why more and more investors are turning to professional management. And of course, a financial advisor can help you construct a solid financial plan, make sound investment choices, and guide you through times of volatility. Past performance is no guarantee of future results. Diversification does not ensure against loss. There is no guarantee that these investment strategies will work under all market conditions and each investor should evaluate their ability to invest for a long term especially during periods of downturn in the market. Historical stock and bond returns are represented by the S&P 500 Index & Long-Term Government Bonds for the 1926-2000 period. Source: Ibbotson. It is not possible to invest directly in an unmanaged index. Spring 2001 | access 9 [GRAPHIC] Morningstar chose two bond funds for its 401(k) plan. And they're both ours. For more information on PIMCO's complete range of bond funds, including PIMCO Total Return and High Yield Funds, call your financial advisor today. [LOGO OF PIMCO FUNDS] Past performance is no guarantee of future results. Selection of these funds by Morningstar was not based solely on performance. Morningstar chose institutional class shares for use in its plan. Expense ratios differ by share class. For additional details on the PIMCO Funds, call for a free prospectus that contains more complete information including charges and expenses. Please read this information carefully before you invest or send money. MARCH 31, 2001 Annual Report bond Pacific Investment Management Series Share Class D SHORT DURATION BOND FUNDS Short Duration Municipal Income Fund Short-Term Fund Low Duration Fund INTERMEDIATE DURATION BOND FUNDS Total Return Fund Total Return Mortgage Fund INFLATION-INDEXED BOND FUNDS Real Return Bond Fund TAX-EXEMPT BOND FUNDS Municipal Bond Fund California Interm. Municipal Bond Fund California Municipal Bond Fund New York Municipal Bond Fund INTERNATIONAL BOND FUNDS Foreign Bond Fund Emerging Markets Bond Fund HIGH YIELD BOND FUNDS High Yield Fund CONVERTIBLE FUNDS Convertible Fund STOCK AND BOND FUNDS Strategic Balanced Fund ENHANCED INDEX STOCK FUNDS StocksPLUS Fund [LOGO OF PIMCO FUNDS] Table of Contents Chairman's Letter .............................................................3 Fund Summaries .............................................................4-35 Schedules of Investments .................................................37-115 Fund Schedule of Fund Summary Investment California Interm. Muni. Bond Fund ...........................4 ..............37 California Municipal Bond Fund ...............................6 ..............40 Convertible Fund .............................................8 ..............42 Emerging Markets Bond Fund ..................................10 ..............44 Foreign Bond Fund ...........................................12 ..............46 High Yield Fund .............................................14 ..............52 Low Duration Fund ...........................................16 ..............58 Municipal Bond Fund .........................................18 ..............66 New York Municipal Bond Fund ................................20 ..............69 Real Return Bond Fund .......................................22 ..............70 Short Duration Municipal Income Fund ........................24 ..............74 Short-Term Fund .............................................26 ..............76 StocksPLUS Fund .............................................28 ..............80 Strategic Balanced Fund .....................................30 ..............84 Total Return Fund ...........................................32 ..............85 Total Return Mortgage Fund ..................................34 .............114 Financial Highlights ....................................................116-117 Statements of Assets and Liabilities ....................................118-119 Statements of Operations ............................................... 120-121 Statements of Changes in Net Assets .....................................122-125 Statements of Cash Flows ....................................................126 Notes to Financial Statements ...........................................127-134 [PHOTO] Dear Shareholder: It's a good time to be a bond manager. Against the backdrop of a languishing U.S. stock market, the Lehman Brothers Aggregate Bond Index, considered to be representative of the bond market as whole, returned 12.53% in the past 12 months. These strong results surely demonstrate that bonds can be as much a vehicle for capital appreciation as they are a source of income and stability. They also underscore the importance of portfolio diversification. The 59.76% and 21.68% declines of the NASDAQ and S&P 500 Index since this time last year have rattled many investors. If you're among them, remember--the theory of asset allocation holds that different asset classes will outperform and underperform at different times. That's why it's so important to diversify your investments across stocks, bonds and cash, as well as different sectors and investment styles. Above all, you should work with your financial advisor to develop a sound investment plan--and then stick to it. Time in the market has proven to be far more significant than timing the market when it comes to long-term investment performance. Be assured that each of the PIMCO Funds in this report seeks to moderate risk by diversifying across a range of securities that meets its investment objective. As to our Funds' performance this past year, I'm pleased to once again report strong relative results across the board. I encourage you to review the fund information and commentaries on the following pages carefully. If you have any questions, contact your financial advisor or call us at 1-800-426-0107. And be sure to visit our Web site at www.pimcofunds.com. As always, thank you for the trust you've placed in us. Sincerely, /s/ Brent R. Harris Brent R. Harris Chairman of the Board April 28, 2001 3.31.01 | PIMCO Funds Annual Report 3 A TAX-EXEMPT BOND FUND PIMCO CA Intermediate Municipal Bond Fund OBJECTIVE: Seek high current income exempt from federal and California income tax. PORTFOLIO: Intermediate maturity municipal securities. DURATION RANGE: 3-7 years FUND INCEPTION DATE: 8/31/99 TOTAL NET ASSETS: $118.5 million PORTFOLIO MANAGER: Mark McCray [PHOTO] Mark McCray Portfolio Manager Mr. McCray is responsible for municipal bond portfolios at PIMCO. Previously he was Co-Head of Municipal Bond Trading at Goldman Sachs & Co. and has over 10 years of investment experience. Fund Highlights . 10.21% return outperformed benchmark and Lipper Fund Average. . Fed easing and slowing economy made for a strong bond market. . High quality bias drove performance in the face of an energy crisis. . Municipals look attractive going forward. Municipals turn in a strong performance I am pleased to report that PIMCO California Intermediate Municipal Bond Fund delivered strong returns for the one-year period ended March 31, 2001, with Class D shares returning 10.21%. The Fund outpaced its benchmark, the Lehman California Intermediate Municipal Bond Index, which returned 9.29%, and handily beat the Lipper California Intermediate Municipal Debt Fund Category Average, which returned 8.98%. Bonds anchor the market The Fund's performance was supported by one of the strongest bond markets in recent memory. In mid-2000, the Federal Reserve discontinued its tightening campaign. Towards the end of the year, the bond market, sensing an economic slowdown and possible Fed rate cuts, pushed Treasury yields down significantly. The California municipal bond market followed suit, helped by strengthened demand for high quality amid concerns over the California energy crisis. In the first quarter of 2001, the bond market proved prescient, as the Federal Reserve slashed interest rates three times, lowering the Federal Funds rate from 6.50% to 5.00% by March 31. High quality, alternate investments, drive performance The PIMCO California Intermediate Municipal Bond Fund maintained an above-benchmark duration for most of the year, which helped returns as California municipal yields fell across all maturities. The Fund's high quality credit stance also enhanced returns. Diversification into non-California debt that qualified for California tax-exemption boosted returns as California municipal debt lagged in the latter half of the year in response to the California energy crisis. In addition, holdings of longer-term insured bonds also contributed to returns. The Fund's emphasis on longer-maturity issues, which offered attractive risk-adjusted yields, hurt performance as these yields dropped less than intermediate- and short-maturity yields. Finding value in municipals Going forward, we anticipate a global economic slowdown, with the United States leading the way. Given this environment, we believe that the bond market is poised to perform relatively well, however, risks of credit erosion as the economy slows continue to argue for a bias towards higher quality assets. As for the Fund, we expect to extend duration above the benchmark in order to take advantage of falling rates in anticipation of continued U.S. economic weakness and further Fed action. We hope to emphasize longer-maturity issues, which we feel continue to offer attractive risk-adjusted yields. In order to mitigate the impact of the energy crisis, we intend to continue to invest in non-California debt that qualifies for state tax-exemption, and also increase our holdings of insured California bonds. Finally, we expect to maintain our high quality stance, as California municipal credit premiums are likely to widen, given slower economic growth and higher energy prices. 4 PIMCO Funds Annual Report | 3.31.01 PIMCO CA Interm. Municipal Bond Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (8/31/99) PIMCO CA Interm. Municipal Bond Fund D Shares 10.21% -- -- -- 8.28% Lipper CA Intermediate Muni. Debt Fund Avg. 8.98% -- -- -- -- Lehman Bros. CA Intermediate Municipal Bond Index 9.29% -- -- -- --
MATURITY PROFILE Less than 1 year 12% 1-5 years 21% 5-10 years 41% 10-20 years 16% 20-30 years 9% Over 30 years 1% Duration 6.7 years SECTOR BREAKDOWN Municipal Bonds & Notes 99.6% Other 0.4% QUALITY BREAKDOWN AAA 52.4% AA 23.8% A 8.1% BBB 10.6% BB 5.1% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] CALIFORNIA INTERMEDIATE MUNICIPAL BOND FUND Lehman Bros. PIMCO CA CA Interm. Interm. Muni. Muni. Bond MONTH Bond D Index ------------------------------------------------------------------------------ 08/31/1999 10,000 10,000 09/30/1999 10,067 10,064 10/31/1999 9,989 9,998 11/30/1999 10,071 10,080 12/31/1999 10,024 9,987 01/31/2000 10,052 10,044 02/29/2000 10,114 10,099 03/31/2000 10,292 10,247 04/30/2000 10,265 10,170 05/31/2000 10,311 10,197 06/30/2000 10,503 10,426 07/31/2000 10,638 10,569 08/31/2000 10,789 10,734 09/30/2000 10,754 10,673 10/31/2000 10,820 10,736 11/30/2000 10,870 10,784 12/31/2000 11,048 10,957 01/31/2001 11,225 11,152 02/28/2001 11,241 11,150 03/31/2001 11,344 11,200 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. Rather than stretch for maximum yield, PIMCO's municipal bond team seeks to maximize after-tax total return. The portfolio is scrutinized using a process that models the potential changes in yield and price as the underlying variables of the CA municipal marketplace change. * Past performance is no guarantee of future results. The Fund may invest at least 80% of its assets in debt securities exempt from federal income tax. The Fund may invest 10% of its assets in high yield bonds, lower-rated securities generally involve greater risk to principal than investments in higher-rated securities and may at times invest in derivatives and mortgage related securities. The Fund may invest at least 65% of its assets in bond issuers of California exempt from regular federal income tax and California income tax. The Fund may realize gains and shareholders will incur a tax liability from time to time. Income from the Fund is subject to state and local taxes & may at times be subject to the alternative minimum tax. It is important to note that a fund concentrating in a single state is subject to greater risk of adverse economic conditions and regulatory changes than a fund with broader geographical diversification. This Fund is non-diversified, which means that it may concentrate its assets in a smaller number of issuers than a diversified Fund. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 5 A TAX-EXEMPT BOND FUND PIMCO CA Municipal Bond Fund OBJECTIVE: Seek high current income exempt from federal and California income tax. PORTFOLIO: Investment grade municipal bonds. DURATION RANGE: 3-12 years FUND INCEPTION DATE: 5/16/00 TOTAL NET ASSETS: 12.7 million PORTFOLIO MANAGER: Mark McCray [PHOTO] Mark McCray Portfolio Manager Mr. McCray is responsible for municipal bond portfolios at PIMCO. Previously he was Co-Head of Municipal Bond Trading at Goldman Sachs & Co. and has over 10 years of investment experience. Fund Highlights . Fund has performed strongly since its 5/16/00 launch. . Fed easing and slowing economy made for a strong bond market. . High quality bias boosted returns in light of the CA energy crisis. . Expect to maintain our high-quality stance in anticipation of widening CA muni spreads. PIMCO California Municipal Bond Fund's primary investment objective is to seek high current income exempt from federal and California income taxes. The Fund's inception date is May 16, 2000. Bonds anchor the market In mid-2000, the Federal Reserve discontinued its tightening campaign, as the economy began to feel the effects of higher interest rates. The bond market, sensing an economic slowdown and possible Fed rate cuts, pushed Treasury yields down significantly by the end of the year. In the first quarter of 2001, the bond market proved prescient, as the Federal Reserve slashed interest rates three times, lowering the Federal Funds rate from 6.50% to 5.00% by March 31. In California, limited supply and increased demand, aggressive Fed rate cuts, and investor's preference for high quality contributed to a strong municipal debt market. Focusing on quality In keeping with our high quality stance, the Fund's average credit quality as of March 31, 2001, was AA+, with a majority of the portfolio invested in AAA-rated municipal securities and a limited allocation to lower investment-grade issues. The Fund's average maturity was 11.96 years. Finding value in municipals Going forward, we anticipate a global economic slowdown, with the United States leading the way. Given this environment, we believe that the bond market is poised to perform relatively well, however risks of credit erosion as the economy slows continue to argue for a bias towards higher quality assets. As for the Fund, we expect to extend duration above the benchmark in order to take advantage of falling rates in anticipation of continued U.S. economic weakness and further Fed action. In order to mitigate the impact of the energy crisis, we intend to invest in non-California debt that qualifies for state tax-exemption, and also increase our holdings of insured California bonds. Finally, we expect to maintain our high quality stance, as California municipal credit premiums are likely to widen, given slower economic growth and higher energy prices. 6 PIMCO Funds Annual Report | 3.31.01 PIMCO CA Municipal Bond Fund Performance & Statistics CUMULATIVE TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception* (5/16/00) PIMCO CA Municipal Bond Fund D Shares -- -- -- -- 12.19% Lipper CA Municipal Debt Fund Avg. -- -- -- -- -- Lehman Bros. CA Insured Muni. Bond Index -- -- -- -- --
MATURITY PROFILE Less than 1 year 7% 1-5 years 31% 5-10 years 24% 10-20 years 15% 20-30 years 23% Duration 7.0 years SECTOR BREAKDOWN Municipal Bonds & Notes 98.2% Other 1.8% QUALITY BREAKDOWN AAA 60.6% AA 21.8% A 4.2% BBB 8.0% BB 5.4% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] CALIFORNIA MUNICIPAL BOND FUND Lehman Bros. CA Insured PIMCO CA Muni. Bond MONTH Muni. Bond D Index -------------------------------------------------------------------------------- 05/31/2000 10,000 10,000 06/30/2000 10,207 10,321 07/31/2000 10,347 10,475 08/31/2000 10,490 10,715 09/30/2000 10,461 10,658 10/31/2000 10,520 10,745 11/30/2000 10,579 10,830 12/31/2000 10,794 11,071 01/31/2001 10,958 11,175 02/28/2001 11,040 11,194 03/31/2001 11,110 11,284 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. Rather than stretch for maximum yield, PIMCO's municipal bond team seeks to maximize after-tax total return. The portfolio is scrutinized using a process that models the potential changes in yield and price as the underlying variables of the CA municipal marketplace change. * Inception returns are cumulative since the fund is less than 1 year old. Past performance is no guarantee of future results. The Fund may realize gains and shareholders will incur a tax liability from time to time. Income from the Fund is subject to state and local taxes & may at times be subject to the alternative minimum tax. The Fund may invest up to 10% in high-yield lower-rated securities, which generally involves greater risk to principal than higher-rated bonds. The Fund may also invest in derivative instruments and mortgage-backed securities. It is important to note that a fund concentrating in a single state is subject to greater risk of adverse economic conditions and regulatory changes than a fund with broader geographical diversification. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 7 A CONVERTIBLE FUND PIMCO Convertible Fund OBJECTIVE: Maximum total return. PORTFOLIO: Convertible securities. DURATION RANGE: N/A FUND INCEPTION DATE: 3/31/99 TOTAL NET ASSETS: $91.7 million PORTFOLIO MANAGER: Sandra Durn [PHOTO] Sandra Durn Portfolio Manager Ms. Durn is head of convertible bond strategies at PIMCO. Previously the lead convertible securities portfolio manager at Nicholas-Applegate Capital Management, she has seven years of investment experience. Fund Highlights . Although the Fund has performed strongly since inception, it trailed its benchmark for the 1-year period. . Stock market correction hurt convertibles as defaults and downgrades increased within the corporate bond market. . Will continue to emphasize quality while looking to take advantage of attractively valued issues that are poised to recover. Tough times all around PIMCO Convertible Fund had a difficult year, with Class D shares declining 22.62% for the one-year period ended March 31, 2001. This performance trailed the Fund's benchmark, the First Boston Convertibles Index, which fell 18.84%, and underperformed the average for its Lipper category, which fell 15.31%. The Fund does, however, continue to outperform over the longer term, beating both its benchmark and its Lipper category average since inception. Equity losses spread to convertibles Slow growth in the U.S., combined with three rate cuts by the Federal Reserve, drove Treasury yields down and bond prices up over the past year. That same slow growth, combined with a flight to quality, severely hurt returns in the equity markets. These losses spread to the convertible universe, as the First Boston Convertible Index slid almost as much as the S&P 500 over the past year. Generally, higher quality convertible securities outperformed lower quality issues as defaults and downgrades increased within the corporate bond market. Low delta contains losses PIMCO Convertible Fund's below-index delta, or its sensitivity to underlying stock prices, helped returns amid sharp declines in global equity markets. The Fund's high quality stance, emphasizing investment-grade convertibles, was positive for returns as investors sought the downside protection that these issues offer. The Fund's exposure to telecom and technology issues was, however, rough on performance as these industries suffered from disappointing earnings and pressure on profit margins amid slower capital investment by businesses both in the U.S. and abroad. Economic weakness in the near term We believe that the U.S. economy will continue to struggle over the next two or three quarters, leading a worldwide slowdown. Banks throughout the world, including our own Federal Reserve, will cut interest rates in order to mitigate this slowdown. In general, we expect bonds to perform relatively well in this environment, with the strength of the bond market providing protection as the investment value of convertibles begins to stabilize. We intend to maintain PIMCO Convertible Fund's emphasis on high quality, holding mostly investment-grade convertibles, as these issues offer relatively significant downside protection. We plan to target the Fund's delta below-index to minimize the impact of potentially adverse equity market performance while keeping an eye toward companies in the technology and tele-com sectors that are poised to recover from the market correction and that offer compelling valuations. The Fund will continue to invest in non-cyclical sectors such as healthcare that are relatively immune from the economic slowdown. 8 PIMCO Funds Annual Report | 3.31.01 PIMCO Convertible Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (3/31/99) PIMCO Convertible Fund D Shares -22.62% -- -- -- 11.29% Lipper Convertible Securities Fund Avg. -15.31% -- -- -- -- First Boston Convertible Bond Index -18.84% -- -- -- --
MATURITY PROFILE Less than 1 year 18% 1-5 years 37% 5-10 years 1% 10-20 years 36% 20-30 years 8% Duration 1.3 years SECTOR BREAKDOWN Convertible Bonds & Notes 60.5% Convertible Preferred Stock 36.7% Other 2.8% QUALITY BREAKDOWN AA 8.6% A 30.9% BBB 38.8% BB 12.2% B 9.5% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] CONVERTIBLE FUND First Boston MONTH PIMCO Convertible D Convertible Index ------------------------------------------------------------------------------- 03/31/1999 10,000 10,000 04/30/1999 10,477 10,405 05/31/1999 10,663 10,309 06/30/1999 11,239 10,754 07/31/1999 11,265 10,612 08/31/1999 11,242 10,643 09/30/1999 11,347 10,671 10/31/1999 11,802 11,040 11/30/1999 12,666 11,888 12/31/1999 14,177 13,695 01/31/2000 14,466 13,489 02/29/2000 16,009 14,905 03/31/2000 16,005 14,584 04/30/2000 14,930 13,873 05/31/2000 14,462 13,129 06/30/2000 15,243 13,982 07/31/2000 14,806 13,560 08/31/2000 15,934 14,603 09/30/2000 15,655 14,396 10/31/2000 14,930 13,734 11/30/2000 13,051 12,071 12/31/2000 14,026 12,623 01/31/2001 14,458 13,363 02/28/2001 12,890 12,339 03/31/2001 12,383 11,837 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The portfolio's risk/reward profile is then dynamically managed in order to modestly participate with rising equity prices while protecting against declines. Disciplined company/credit analysis maximizes the portfolio's capital appreciation potential * Past performance is no guarantee of future results. The Fund may invest up to 35% of its assets in high yield securities which are lower rated securities, 20% in foreign currencies which can involve special risks due to foreign economic and political developments, emerging markets, and investing in smaller companies. The Fund may have to convert securities before it would otherwise choose to, which may have an adverse effect on the Fund's ability to achieve its investment objective. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 9 AN INTERNATIONAL BOND FUND PIMCO Emerging Markets Bond Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management (non-U.S.). PORTFOLIO: Primarily emerging markets bonds. DURATION RANGE: 0-8 years FUND INCEPTION DATE: 7/31/97 TOTAL NET ASSETS: $57.6 million PORTFOLIO MANAGER: Mohamed El-Erian [PHOTO] Mohamed El-Erian Portfolio Manager Dr. El-Erian is a managing director and head of the firm's emerging markets portfolio management team. His past experience includes 15 years with the IMF leading policy work on debt and country issues. Fund Highlights . 12.58% return soundly beat Lipper Average. . Slowing worldwide growth pushed emerging markets bonds higher. . Underweight exposure to Argentina proved to be a prescient move. . Expect higher-quality bonds to perform relatively well in the months ahead. Emerging Markets post strong year PIMCO Emerging Markets Bond Fund delivered strong results for its shareholders, with Class D shares returning 12.58% for the one-year period ended March 31, 2001. This performance outpaced the Fund's benchmark, the J.P. Morgan Emerging Markets Bond Index, which returned 9.65%, and soundly beat the Lipper Emerging Markets Debt Fund Average's return of 5.22%. Slowing growth boosts bonds Emerging market bonds thrived on signs of a slowing economy worldwide, led by the U.S. and the three Federal Reserve rate cuts totaling 150 basis points. Emerging markets bonds performed well for most of the year, buoyed by improved economic fundamentals, stronger economic growth, improvements in liability management, and successful conclusions to debt restructuring. Concerns about possible contagion effects from problem countries such as Argentina and Turkey, however, dragged the sector down in early 2001. Steering clear of Argentina proves wise PIMCO Emerging Markets Bond Fund's performance was greatly helped by our underweight position relative to the benchmark in Argentina, as continued financial deterioration, political uncertainty and weakening growth weighed heavily on the market. The Fund's overweight in Brazil also helped returns due to improved liability management, low inflation, strong economic growth and aggressive central bank easings. An emphasis in Bulgaria further boosted returns as it received a favorable ratings upgrade and its political situation stabilized. The Fund's overweight in Peru was mostly negative for performance during the year as the political situation there became uncertain and the country had a temporary disruption of its Brady Bond payments. This was mitigated by an agreement with the IMF on an economic program for 2001. Quality the key We believe that worldwide economic growth will continue to slow. Banks throughout the world, including our own Federal Reserve, will cut interest rates in order to mitigate this slowdown. In general, we expect bonds to perform relatively well in this environment, especially within the higher quality segment. In particular, countries with demonstrably sustainable economic growth and stable political situations should excel. We expect to maintain PIMCO Emerging Markets Bond Fund's high quality bias, keeping its average credit quality above the benchmark. We intend to keep underweight positions in Argentina and Turkey as both countries will continue wrestling with domestic challenges. Meanwhile, we hope to continue overweighting Brazil, where positive fundamentals will likely more than offset short term regional volatility, and to modestly overweight Mexico, given its continued economic improvement and the high probability of a ratings upgrade. We will also continue our strategy of seeking opportunities in non-index countries, and owning issues with high liquidity that provide the flexibility necessary in order to react to dynamic changes in emerging market economies. 10 PIMCO Funds Annual Report | 3.31.01 PIMCO Emerging Markets Bond Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (7/31/97) PIMCO Emerging Markets Bond Fund D Shares 12.58% 7.70% -- -- 7.07% Lipper Emerging Markets Debt Fund Average 5.22% 1.82% -- -- -- J.P. Morgan Emerging Markets Bond Index Plus 9.65% 6.57% -- -- --
MATURITY PROFILE Less than 1 year 30% 1-5 years 7% 5-10 years 26% 10-20 years 18% 20-30 years 15% Over 30 years 4% Duration 5.0 years COUNTRY ALLOCATION Brazil 28.7% Mexico 19.8% Russia 13.2% Venezuela 5.8% Short-Term Instruments 5.1% Other 27.4% QUALITY BREAKDOWN AAA 4.9% AA 1.1% BBB 41.6% BB 43.7% B 8.7% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] EMERGING MARKETS J.P. Morgan Emerging PIMCO Emerging Markets Bond Index MONTH Markets D Plus ------------------------------------------------------------------------------- 07/31/1997 10,000 10,000 08/31/1997 9,879 9,960 09/30/1997 10,150 10,264 10/31/1997 8,992 9,082 11/30/1997 9,464 9,513 12/31/1997 9,703 9,841 01/31/1998 9,714 9,822 02/28/1998 9,988 10,103 03/31/1998 10,283 10,354 04/30/1998 10,306 10,379 05/31/1998 9,971 10,025 06/30/1998 9,641 9,735 07/31/1998 9,786 9,802 08/31/1998 7,056 6,985 09/30/1998 7,603 7,668 10/31/1998 7,999 8,165 11/30/1998 8,635 8,645 12/31/1998 8,529 8,429 01/31/1999 8,231 8,117 02/28/1999 8,393 8,233 03/31/1999 8,958 8,857 04/30/1999 9,703 9,462 05/31/1999 9,093 8,922 06/30/1999 9,364 9,321 07/31/1999 9,302 9,128 08/31/1999 9,283 9,115 09/30/1999 9,696 9,434 10/31/1999 10,006 9,798 11/30/1999 10,274 10,075 12/31/1999 10,754 10,620 01/31/2000 10,514 10,410 02/29/2000 11,133 11,080 03/31/2000 11,412 11,429 04/30/2000 11,193 11,211 05/31/2000 10,973 10,925 06/30/2000 11,485 11,479 07/31/2000 11,761 11,826 08/31/2000 12,169 12,243 09/30/2000 12,006 12,077 10/31/2000 11,802 11,805 11/30/2000 11,859 11,745 12/31/2000 12,276 12,284 01/31/2001 12,792 12,911 02/28/2001 12,745 12,706 03/31/2001 12,848 12,532 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The manager is guided by risk-adjusted real yields. His goal is to identify not only which countries to overweight or underweight, but where on each country's yield curve the Fund should take an exposure. * Past performance is no guarantee of future results. This Fund may invest at least 80% of its assets in issuers that economically are tied to countries with emerging securities markets. Investing in foreign securities may entail greater risk due to foreign economic and political developments, this risk may be enhanced when investing in emerging markets. The Fund may also invest in high yield securities, lower-rated securities generally involve greater risk to principal than investments in higher-rated securities and may at times invest in derivatives. This Fund is non-diversified, which means that it may concentrate its assets in a smaller number of issuers than a diversified Fund. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 11 AN INTERNATIONAL BOND FUND PIMCO Foreign Bond Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management (non-U.S.). PORTFOLIO: Primarily investment grade foreign bonds. DURATION RANGE: 3-7 years FUND INCEPTION DATE: 12/02/92 TOTAL NET ASSETS: $674.8 million PORTFOLIO MANAGER: Sudi Mariappa Sudi Mariappa Portfolio Manager Mr. Mariappa is lead portfolio manager of PIMCO Foreign Bond and Global Bond II Funds and oversees the firm's Asian trading and portfolio management group in Japan. He has 14 years of investment experience. Fund Highlights . 10.84% return betters benchmark and Lipper Average. . Central bank actions and a volatile Euro caused market opportunities to shift throughout the year. . European exposure boosted returns due to a year-end rally. . Continued global slowdown could lead to central bank rate cuts, creating a positive environment for foreign bonds. Staying ahead of the pack I am pleased to report that PIMCO Foreign Bond Fund had a strong twelve months, with Class D shares posting a 10.84% return for the year ending March 31, 2001. This performance surpassed the returns of the Fund's benchmark and its Lipper Average. The Foreign Bond Fund has now significantly outperformed its Lipper Average for the 1-, 3-, 5-year and since-inception periods. The year's ups and downs Foreign bond markets offered a mixed bag of opportunities during the year. Japan is a perfect example. Japanese bonds underperformed in 2000, but aggressive actions by the Bank of Japan in the first quarter of 2001 allowed the country's bond market to finish on a high. European bonds were also up and down during the year. A record low Euro dragged down Europe's bond market for most of 2000, until the currency's comeback late in 2000 drew capital back to European markets. But investor confidence fell again in the beginning of 2001 when the European Central Bank (ECB) unexpectedly failed to cut rates. Emerging markets bonds showed some strength in 2000 but interest quickly cooled off as investors became more risk averse and more concerned about credit problems in Turkey and Argentina. European bonds provide lift The Fund's overweight position in core European bonds boosted performance due to an end-of-year rally in the European bond markets. Short-term exposure was particularly beneficial because of the expectations that early-maturity interest rates had peaked. Extending the Fund's average duration late in the year was also a positive as yields fell worldwide in response to slower growth. Our underweight position in Japan relative to the benchmark hurt overall returns as Japanese Government Bonds maintained their strong performance with the Japanese economy continuing to flounder. The Fund's fairly small long position in the Euro also detracted from performance, since the currency fell amidst concern that the ECB would keep interest rates relatively high, limiting growth prospects. Opportunities going forward Looking ahead, we expect to see improving foreign bond market opportunities. We believe global growth will continue to slow as the economic downturn in the U.S. spreads to other countries. Global central banks will likely try to help by cutting rates, and they will probably do so more aggressively than investors currently anticipate. This should create a good environment for foreign bonds. To succeed in this market, we intend to maintain an above-benchmark duration for the Fund and focus on shorter maturities. In terms of country allocations, we plan to overweight core Europe and the U.K., underweight Japan, and remain cautious toward emerging markets bonds. 12 PIMCO Funds Annual Report | 3.31.01 PIMCO Foreign Bond Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (12/2/92) PIMCO Foreign Bond Fund D Shares 10.84% 6.53% 9.71% -- 9.45% Lipper International Income Fund Avg. 0.00% 1.71% 2.82% -- -- J.P. Morgan Non-U.S. Index (Hedged) 10.36% 7.91% 9.92% -- --
MATURITY PROFILE Less than 1 year 22% 1-5 years 19% 5-10 years 59% Duration 6.0 years COUNTRY ALLOCATION United States 40.5% Germany 11.9% Italy 9.4% France 6.6% Canada 6.0% Short-Term Instruments 6.6% Other 19.0% QUALITY BREAKDOWN AAA 67.4% AA 21.1% A 4.9% BBB 3.9% BB 2.7% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] FOREIGN BOND FUND JP Morgan PIMCO Non-U.S. Index MONTH Foreign D (Hedged) -------------------------------------------------------------------------------- 12/31/1992 10,000 10,000 01/31/1993 10,079 10,091 02/28/1993 10,297 10,274 03/31/1993 10,332 10,280 04/30/1993 10,328 10,281 05/31/1993 10,417 10,338 06/30/1993 10,660 10,549 07/31/1993 10,824 10,667 08/31/1993 11,083 10,889 09/30/1993 11,123 10,936 10/31/1993 11,284 11,082 11/30/1993 11,312 11,159 12/31/1993 11,590 11,390 01/31/1994 11,601 11,333 02/28/1994 11,290 11,078 03/31/1994 11,089 10,977 04/30/1994 10,981 10,899 05/31/1994 10,816 10,779 06/30/1994 10,613 10,669 07/31/1994 10,675 10,739 08/31/1994 10,566 10,636 09/30/1994 10,580 10,645 10/31/1994 10,617 10,687 11/30/1994 10,770 10,838 12/31/1994 10,696 10,813 01/31/1995 10,764 10,931 02/28/1995 10,831 11,072 03/31/1995 10,834 11,297 04/30/1995 11,095 11,477 05/31/1995 11,527 11,854 06/30/1995 11,453 11,814 07/31/1995 11,667 11,963 08/31/1995 11,885 12,067 09/30/1995 12,051 12,258 10/31/1995 12,248 12,395 11/30/1995 12,725 12,667 12/31/1995 12,909 12,785 01/31/1996 13,222 12,939 02/29/1996 12,936 12,787 03/31/1996 13,142 12,893 04/30/1996 13,456 13,047 05/31/1996 13,503 13,136 06/30/1996 13,651 13,245 07/31/1996 13,780 13,345 08/31/1996 14,113 13,522 09/30/1996 14,504 13,810 10/31/1996 14,858 14,038 11/30/1996 15,213 14,319 12/31/1996 15,289 14,339 01/31/1997 15,528 14,518 02/28/1997 15,607 14,611 03/31/1997 15,407 14,533 04/30/1997 15,546 14,690 05/31/1997 15,622 14,767 06/30/1997 15,931 15,018 07/31/1997 16,162 15,257 08/31/1997 16,091 15,275 09/30/1997 16,434 15,545 10/31/1997 16,237 15,645 11/30/1997 16,451 15,757 12/31/1997 16,686 15,962 01/31/1998 16,922 16,174 02/28/1998 17,072 16,318 03/31/1998 17,280 16,464 04/30/1998 17,336 16,548 05/31/1998 17,476 16,774 06/30/1998 17,560 16,847 07/31/1998 17,834 17,003 08/31/1998 17,686 17,338 09/30/1998 18,086 17,749 10/31/1998 17,706 17,722 11/30/1998 18,032 17,914 12/31/1998 18,279 17,892 01/31/1999 18,648 18,114 02/28/1999 18,460 17,993 03/31/1999 18,567 18,207 04/30/1999 18,801 18,438 05/31/1999 18,500 18,363 06/30/1999 18,268 18,078 07/31/1999 18,270 18,031 08/31/1999 18,133 18,063 09/30/1999 18,224 18,132 10/31/1999 18,300 18,176 11/30/1999 18,330 18,281 12/31/1999 18,484 18,336 01/31/2000 18,382 18,338 02/29/2000 18,586 18,473 03/31/2000 18,846 18,743 04/30/2000 18,907 18,844 05/31/2000 19,014 18,995 06/30/2000 19,151 19,086 07/31/2000 19,306 19,224 08/31/2000 19,281 19,227 09/30/2000 19,528 19,393 10/31/2000 19,571 19,550 11/30/2000 19,855 19,896 12/31/2000 20,218 20,117 01/31/2001 20,511 20,355 02/28/2001 20,622 20,530 03/31/2001 20,892 20,685 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The manager then uses a top-down country bond allocation model to determine the countries with the best risk-adjusted yields. Bottom-up strategies, including sector rotation and credit research, aid in issue selection. * Past performance is no guarantee of future results. This Fund may invest at least 85% of its assets in foreign securities, which may entail greater risk due to foreign economic and political developments, may at times invest in derivatives and mortgage related securities. The Fund may invest up to 10% in high yield securities, lower rated securities generally involves greater risk to principal than investment in higher rated securities. This Fund is non-diversified, which means that it may concentrate its assets in a smaller number of issuers than a diversified Fund. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 13 A HIGH YIELD BOND FUND PIMCO High Yield Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management. PORTFOLIO: Primarily high yield bonds. DURATION RANGE: 2-6 years FUND INCEPTION DATE: 12/15/92 TOTAL NET ASSETS: $2.6 billion PORTFOLIO MANAGER: Ben Trosky [PHOTO] Ben Trosky Portfolio Manager Mr. Trosky is a Managing Director and a senior member of PIMCO's portfolio management and investment strategy groups. He has over 20 years of investment experience. Fund Highlights . 5.40% return outperformed Lipper Average, which returned -3.20%. . Although rising default rates hurt the sector, Fed rate cuts sparked a high yield rally in early 2001. . High credit quality exposure was key to the Fund's solid returns. . Continue to favor relatively high quality going forward. Outpacing Lipper Average It is my pleasure to report that PIMCO High Yield Fund Class D shares returned 5.40% for the year ending March 31, 2001, significantly outperforming the Lipper High Current Yield Funds Average return of -3.20%. The Fund did, however, underperform its benchmark, the Lehman Intermediate BB Corporate Index, which rose 11.08%. Fed sparks rally After months of deteriorating economic conditions, the Federal Reserve cut rates three times in the first quarter of 2001. This aggressive easing sparked a rally that had high yield bonds outperforming investment-grade sectors in January. Default rates continued to rise, however, and downgrades outpaced upgrades as the economy slowed further. Credit quality the key PIMCO High Yield Fund's focus on the upper credit quality tiers of the high yield market helped preserve capital and generate positive returns. An emphasis on non-cyclical industries enhanced performance as this segment was relatively immune to the economic slowdown. The Fund also benefited from its overweight position in industries with steady cash flow, such as cable operators and gaming concerns. The Fund's overweight position in telecommunications-related issues hurt performance as reduced growth and limited access to capital caused this sector to lag. The Fund's relatively low exposure to single-B-rated credits detracted from performance when compared to the benchmark as this sector benefited the most from the first-quarter spike. Quality is the watchword While the high yield market staged a strong rally to begin 2001, we remain cautious given our forecast for a continued slowdown in the U.S. economy and further contraction of corporate profits. In this environment, we believe that maintaining a defensive posture will be instrumental in preserving capital while providing superior relative performance. We expect to maintain the portfolio's relatively high average quality of BB and to favor larger issues with multiple underwriters. We intend to be overweighted in areas we believe to have improving fundamentals as well as in areas with strong cash flows. We will stay underweighted in issues from cyclical sectors as they are more sensitive to a slowing economy. 14 PIMCO Funds Annual Report | 3.31.01 PIMCO High Yield Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (12/15/92) PIMCO High Yield Fund D Shares 5.40% 2.83% 6.87% -- 9.01% Lipper High Current Yield Fund Average -3.20% -2.07% 3.77% -- -- Lehman Int. BB-rated Corp. Index 11.08% 4.95% 7.40% -- --
MATURITY PROFILE Less than 1 year 12% 1-5 years 32% 5-10 years 49% 10-20 years 6% 20-30 years 1% Duration 3.7 years SECTOR BREAKDOWN Corporate Bonds & Notes 76.2% Asset-Backed Securities 10.5% Short-Term Instruments 6.2% Other 7.1% QUALITY BREAKDOWN AAA 5.6% AA 1.1% A 2.1% BBB 14.4% BB 44.0% B 32.8% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] HIGH YIELD FUND Lehman Int. PIMCO High BB-rated Corp. MONTH Yield D Index -------------------------------------------------------------------------------- 12/31/1992 10,000 10,000 01/31/1993 10,224 10,211 02/28/1993 10,409 10,361 03/31/1993 10,616 10,478 04/30/1993 10,726 10,566 05/31/1993 10,801 10,644 06/30/1993 11,091 10,870 07/31/1993 11,167 10,980 08/31/1993 11,288 11,107 09/30/1993 11,341 11,188 10/31/1993 11,642 11,338 11/30/1993 11,728 11,368 12/31/1993 11,825 11,465 01/31/1994 12,074 11,657 02/28/1994 12,068 11,644 03/31/1994 11,703 11,288 04/30/1994 11,598 11,221 05/31/1994 11,679 11,231 06/30/1994 11,692 11,265 07/31/1994 11,798 11,402 08/31/1994 11,894 11,523 09/30/1994 11,972 11,544 10/31/1994 11,975 11,571 11/30/1994 11,923 11,492 12/31/1994 12,063 11,563 01/31/1995 12,177 11,749 02/28/1995 12,507 12,106 03/31/1995 12,686 12,220 04/30/1995 12,959 12,465 05/31/1995 13,331 12,831 06/30/1995 13,436 12,944 07/31/1995 13,612 13,062 08/31/1995 13,713 13,138 09/30/1995 13,901 13,280 10/31/1995 14,100 13,384 11/30/1995 14,267 13,553 12/31/1995 14,504 13,767 01/31/1996 14,735 13,990 02/29/1996 14,747 13,940 03/31/1996 14,626 13,867 04/30/1996 14,686 13,862 05/31/1996 14,731 13,881 06/30/1996 14,787 14,031 07/31/1996 14,914 14,107 08/31/1996 15,153 14,221 09/30/1996 15,502 14,527 10/31/1996 15,652 14,729 11/30/1996 15,987 15,026 12/31/1996 16,142 15,059 01/31/1997 16,303 15,203 02/28/1997 16,550 15,386 03/31/1997 16,328 15,203 04/30/1997 16,498 15,392 05/31/1997 16,869 15,655 06/30/1997 17,113 15,857 07/31/1997 17,550 16,330 08/31/1997 17,539 16,174 09/30/1997 17,830 16,428 10/31/1997 17,843 16,484 11/30/1997 18,009 16,600 12/31/1997 18,209 16,752 01/31/1998 18,516 16,953 02/28/1998 18,611 17,031 03/31/1998 18,752 17,140 04/30/1998 18,795 17,228 05/31/1998 18,888 17,340 06/30/1998 19,022 17,446 07/31/1998 19,218 17,536 08/31/1998 18,441 17,052 09/30/1998 18,670 17,414 10/31/1998 18,479 17,191 11/30/1998 19,254 17,603 12/31/1998 19,331 17,714 01/31/1999 19,582 17,897 02/28/1999 19,416 17,764 03/31/1999 19,571 17,892 04/30/1999 19,892 18,075 05/31/1999 19,506 17,856 06/30/1999 19,496 17,815 07/31/1999 19,543 17,883 08/31/1999 19,461 17,770 09/30/1999 19,467 17,843 10/31/1999 19,438 17,782 11/30/1999 19,700 17,933 12/31/1999 19,796 18,104 01/31/2000 19,701 17,975 02/29/2000 19,743 18,009 03/31/2000 19,342 17,838 04/30/2000 19,379 17,899 05/31/2000 19,276 17,906 06/30/2000 19,638 18,293 07/31/2000 19,788 18,597 08/31/2000 20,069 18,883 09/30/2000 20,003 18,790 10/31/2000 19,588 18,507 11/30/2000 19,212 18,410 12/31/2000 19,622 18,779 01/31/2001 20,424 19,470 02/28/2001 20,634 19,748 03/31/2001 20,387 19,815 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The Fund focuses on upper-tier credits of the high yield market because historically they have delivered the best risk-return profile. Importantly, income, capital appreciation and capital preservation are all considered in structuring the portfolio. * Past performance is no guarantee of future results. This Fund may invest at least 65% of its assets in high yield securities rated below investment grade but rated at least B by Moody's or S&P. This Fund may also invest in foreign securities, which may entail greater risk due to foreign economic and political developments, and may at times invest in derivatives and mortgage-related securities. An investment in high yield securities, lower rated securities generally involves greater risk to principal than an investment in higher-rated bonds. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 15 A SHORT DURATION BOND FUND PIMCO Low Duration Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management. PORTFOLIO: Primarily shorter-term, investment grade bonds. DURATION RANGE: 1-3 years FUND INCEPTION DATE: 5/11/87 TOTAL NET ASSETS: $4.6 billion PORTFOLIO MANAGER: Bill Gross [PHOTO] Bill Gross Portfolio Manager Managing Director and co-founder of PIMCO, Mr. Gross is widely regarded as the world's foremost fixed income authority. He has over 30 years of investment experience. Recently, Mr. Gross and the PIMCO bond team were named Morningstar's 2000 Fixed Income Manager of the Year--making them the only two-time winner of the prestigious award. Fund Highlights . 9.10% return outpaced Lipper Average. . Fund's performance was supported by a strong U.S. bond market. . Above-Index duration boosted returns. . Continued economic weakness should bode well for higher-quality bonds. Solid results highlight year I am pleased to report an 9.10% total return for PIMCO Low Duration Fund's Class D shares for the year ending March 31, 2001. This result slightly underperformed the Fund's benchmark Merrill Lynch 1-3 Year Treasury Index return of 9.60% but surpassed its Lipper Average, which returned 8.97%. Bond market shows strength PIMCO Low Duration Fund's total return for the year was supported by one of the stronger bond markets in recent years. With the economy slowing sharply, default rates and downgrades rising in the corporate sector and investors anticipating further aggressive Federal Reserve easing, Treasury yields fell and higher quality bonds outperformed lower quality issues. Longer duration pays off PIMCO Low Duration Fund's emphasis throughout the year on longer-than-benchmark duration boosted returns, as yields on short- to intermediate-maturity fell substantially. In addition, our broader-than-index maturity distribution enhanced performance as these yields fell the most. The Fund's allocation to mortgage-backed securities also helped returns as higher yields offset the incremental risk associated with this sector. The Fund's position in investment-grade corporate debt slightly hurt performance as concerns about a slowing economy drove investors to higher quality areas of the bond market. Below-investment-grade holdings also hurt performance, as corporate profitability eroded and default rates increased. Economic weakness to continue We believe that growth will weaken globally, led by the U.S., which will continue to struggle over the next two or three quarters. We expect bonds to perform relatively well in this environment, although risk of further credit erosion is a very real concern. We therefore intend to target the Fund's duration above the benchmark and continue to focus on high quality areas of the bond market like mortgage-backed securities, which offer strong credit quality and attractive yields. In addition, we anticipate maintaining a broad maturity structure to take advantage of value across the entire yield curve, especially in mortgages and high-quality corporates. 16 PIMCO Funds Annual Report | 3.31.01 PIMCO Low Duration Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (5/11/87) PIMCO Low Duration Fund D Shares 9.10% 6.08% 6.70% 7.01% 7.54% Lipper Shrt. Inv. Grade Debt Fund Average 8.97% 5.81% 5.94% 6.29% -- Merrill Lynch 1-3 yr. Treasury Index 9.60% 6.44% 6.43% 6.48% --
MATURITY PROFILE 1-5 years 93% 5-10 years 6% Over 30 years 1% Duration 2.2 years SECTOR BREAKDOWN Mortgage-Backed Securities 59.6% Corporate Bonds & Notes 25.7% Other 14.7% QUALITY BREAKDOWN AAA 69.4% AA 4.5% A 14.8% BBB 9.7% BB 1.6% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] LOW DURATION BOND FUND Merrill Lynch PIMCO Low 1-3 yr. Treas. MONTH Duration D Index -------------------------------------------------------------------------------- 05/31/1987 10,000 10,000 06/30/1987 10,091 10,109 07/31/1987 10,125 10,158 08/31/1987 10,121 10,167 09/30/1987 10,094 10,127 10/31/1987 10,254 10,351 11/30/1987 10,367 10,414 12/31/1987 10,425 10,480 01/31/1988 10,595 10,648 02/29/1988 10,669 10,735 03/31/1988 10,733 10,756 04/30/1988 10,775 10,772 05/31/1988 10,797 10,756 06/30/1988 10,895 10,868 07/31/1988 10,950 10,876 08/31/1988 10,991 10,899 09/30/1988 11,090 11,026 10/31/1988 11,190 11,136 11/30/1988 11,201 11,106 12/31/1988 11,248 11,132 01/31/1989 11,339 11,219 02/28/1989 11,354 11,219 03/31/1989 11,395 11,270 04/30/1989 11,527 11,443 05/31/1989 11,761 11,614 06/30/1989 12,015 11,831 07/31/1989 12,188 12,006 08/31/1989 12,128 11,932 09/30/1989 12,187 12,003 10/31/1989 12,345 12,184 11/30/1989 12,454 12,299 12/31/1989 12,513 12,348 01/31/1990 12,502 12,358 02/28/1990 12,585 12,416 03/31/1990 12,649 12,457 04/30/1990 12,637 12,482 05/31/1990 12,847 12,673 06/30/1990 12,982 12,806 07/31/1990 13,121 12,966 08/31/1990 13,143 13,005 09/30/1990 13,212 13,111 10/31/1990 13,304 13,255 11/30/1990 13,460 13,386 12/31/1990 13,601 13,548 01/31/1991 13,724 13,672 02/28/1991 13,829 13,754 03/31/1991 13,943 13,846 04/30/1991 14,109 13,977 05/31/1991 14,216 14,062 06/30/1991 14,302 14,119 07/31/1991 14,457 14,242 08/31/1991 14,661 14,437 09/30/1991 14,848 14,593 10/31/1991 14,973 14,750 11/30/1991 15,132 14,903 12/31/1991 15,383 15,131 01/31/1992 15,392 15,107 02/29/1992 15,465 15,160 03/31/1992 15,469 15,154 04/30/1992 15,574 15,293 05/31/1992 15,729 15,432 06/30/1992 15,872 15,590 07/31/1992 16,078 15,765 08/31/1992 16,181 15,903 09/30/1992 16,338 16,055 10/31/1992 16,340 15,959 11/30/1992 16,345 15,933 12/31/1992 16,511 16,084 01/31/1993 16,663 16,251 02/28/1993 16,856 16,390 03/31/1993 16,947 16,439 04/30/1993 17,024 16,541 05/31/1993 17,039 16,495 06/30/1993 17,204 16,616 07/31/1993 17,259 16,655 08/31/1993 17,423 16,800 09/30/1993 17,486 16,855 10/31/1993 17,603 16,888 11/30/1993 17,616 16,892 12/31/1993 17,735 16,954 01/31/1994 17,828 17,063 02/28/1994 17,747 16,954 03/31/1994 17,666 16,870 04/30/1994 17,604 16,810 05/31/1994 17,581 16,834 06/30/1994 17,613 16,884 07/31/1994 17,773 17,029 08/31/1994 17,844 17,089 09/30/1994 17,814 17,050 10/31/1994 17,808 17,088 11/30/1994 17,808 17,012 12/31/1994 17,794 17,050 01/31/1995 17,954 17,288 02/28/1995 18,177 17,525 03/31/1995 18,246 17,623 04/30/1995 18,470 17,780 05/31/1995 18,801 18,091 06/30/1995 18,893 18,188 07/31/1995 18,895 18,263 08/31/1995 19,095 18,372 09/30/1995 19,261 18,461 10/31/1995 19,402 18,617 11/30/1995 19,623 18,782 12/31/1995 19,851 18,926 01/31/1996 19,992 19,087 02/29/1996 19,858 19,006 03/31/1996 19,844 18,989 04/30/1996 19,848 19,005 05/31/1996 19,862 19,044 06/30/1996 20,058 19,181 07/31/1996 20,121 19,256 08/31/1996 20,215 19,323 09/30/1996 20,496 19,498 10/31/1996 20,787 19,717 11/30/1996 21,064 19,868 12/31/1996 21,003 19,868 01/31/1997 21,173 19,962 02/28/1997 21,253 20,007 03/31/1997 21,162 20,000 04/30/1997 21,414 20,163 05/31/1997 21,589 20,301 06/30/1997 21,753 20,440 07/31/1997 22,099 20,665 08/31/1997 22,081 20,684 09/30/1997 22,271 20,841 10/31/1997 22,432 20,996 11/30/1997 22,492 21,047 12/31/1997 22,661 21,191 01/31/1998 22,829 21,396 02/28/1998 22,902 21,415 03/31/1998 22,996 21,502 04/30/1998 23,113 21,603 05/31/1998 23,256 21,718 06/30/1998 23,307 21,831 07/31/1998 23,412 21,933 08/31/1998 23,499 22,209 09/30/1998 23,971 22,503 10/31/1998 23,930 22,613 11/30/1998 24,064 22,594 12/31/1998 24,206 22,673 01/31/1999 24,308 22,763 02/28/1999 24,174 22,652 03/31/1999 24,375 22,810 04/30/1999 24,497 22,883 05/31/1999 24,414 22,868 06/30/1999 24,421 22,940 07/31/1999 24,419 23,012 08/31/1999 24,431 23,079 09/30/1999 24,609 23,229 10/31/1999 24,705 23,291 11/30/1999 24,806 23,335 12/31/1999 24,849 23,368 01/31/2000 24,814 23,359 02/29/2000 24,987 23,515 03/31/2000 25,165 23,661 04/30/2000 25,215 23,722 05/31/2000 25,286 23,820 06/30/2000 25,584 24,067 07/31/2000 25,733 24,219 08/31/2000 26,013 24,398 09/30/2000 26,138 24,573 10/31/2000 26,133 24,705 11/30/2000 26,331 24,939 12/31/2000 26,674 25,236 01/31/2001 27,103 25,552 02/28/2001 27,230 25,718 03/31/2001 27,451 25,933 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The manager then employs a number of value-adding strategies, including duration management, sector allocation and liquidity management. Investment in a wide range of short-term instruments further enhances total return potential. * Past performance is no guarantee of future results. The fund may invest up to 20% in foreign securities, which may entail greater risk due to foreign economic and political developments. The Fund may invest up to 10% in high yield securities, lower rated securities generally involves greater risk to principal than investment in higher rated securities, may at times invest in derivatives and mortgage related securities. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 17 A NATIONAL TAX-EXEMPT BOND FUND PIMCO Municipal Bond Fund OBJECTIVE: High current income exempt from federal income tax, consistent with preservation of capital. PORTFOLIO: Investment grade municipal bonds. DURATION RANGE: 3-10 years FUND INCEPTION DATE: 12/31/97 TOTAL NET ASSETS: $80.1 million PORTFOLIO MANAGER: Mark McCray [PHOTO] Mark McCray Portfolio Manager Mr. McCray is responsible for municipal bond portfolios at PIMCO. Previously he was Co-Head of Municipal Bond Trading at Goldman Sachs & Co. and he has over 10 years of investment experience. Fund Highlights . 10.74% return outpaced Lipper Average. . Fed easing caused municipals to rally, with short-term yields dropping the most. . Quality issue selection boosted returns. . Moving forward, barbell approach should take maximum advantage of Fed easing and attractive risk-adjusted yields among longer-duration issues. Munis post solid year PIMCO Municipal Bond Fund delivered strong results for its shareholders, with Class D shares returning 10.74% for the one-year period ended March 31, 2001. This performance was slightly under the Fund's benchmark, the Lehman Municipal Bond Index, which returned 10.93%, but outperformed the Lipper Municipal Debt Fund Average, which returned 9.91%. Strong bond market The U.S. economy slowed considerably over the course of our fiscal year. The Federal Reserve began this period with a rate increase aimed at fighting inflation fears and ended the year with three rate cuts (for a total of 150 basis points) aimed at fighting recession. This environment was generally very favorable for bonds, with high quality bonds typically outperforming lower quality securities. Municipal bonds did very well in this environment, with short-term municipal yields falling further than their longer-term counterparts in response to Fed easings. Issue selection brings results PIMCO Municipal Bond Fund's emphasis on high quality issues greatly enhanced returns as investors focused on credit quality when attempting to counter diminishing corporate profitability. Quality issue selection also played a key role in increasing returns, helped by above-benchmark allocation to revenue bonds as well as holdings in the healthcare and housing industries, two sectors that are relatively less afflicted by an economic downturn. The Fund's below-benchmark duration for most of the year hurt returns due to the overall decline in municipal yields. An underweight position in shorter-maturity bonds also detracted from performance as these were the yields that fell the most in response to Fed easing. Economic weakness in the near term We believe that the U.S. economy will continue to struggle over the next two or three quarters, leading a worldwide slowdown. Banks throughout the world, including our own Federal Reserve, will likely cut interest rates in order to mitigate this slowdown. As a result, municipal bonds should produce attractive tax-adjusted returns under weakening U.S. economic growth due to overall solid credit quality in the municipal market and attractive tax-adjusted yields. In the months ahead, we intend to target the Municipal Bond Fund's duration slightly above the benchmark as slowing growth puts a cap on longer-term yields and municipal yields rally amid further Fed cuts. We expect to maintain our barbell approach, emphasizing a combination of short-duration issues to take advantage of Fed easing and longer-duration securities to take advantage of attractive risk-adjusted yields. We further hope to maintain our high quality stance in the face of continued economic weakness and credit erosion, but selectively add lower-tier issues where we see value. 18 PIMCO Funds Annual Report | 3.31.01 PIMCO Municipal Bond Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (12/31/97) PIMCO Municipal Bond Fund D Shares 10.74% 4.61% -- -- 4.48% Lipper Gen. Municipal Debt Fund Avg. 9.91% 4.04% -- -- -- Lehman Bros. General Municipal Bond Index 10.93% 5.59% -- -- --
MATURITY PROFILE 1-5 years 37% 5-10 years 28% 10-20 years 22% 20-30 years 13% Duration 7.2 years SECTOR BREAKDOWN Municipal Bonds & Notes 99.3% Other 0.7% QUALITY BREAKDOWN AAA 53.1% AA 13.6% A 6.8% BBB 18.7% BB 7.8% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] MUNICIPAL BOND FUND Lehman Bros. PIMCO Municipal Municipal MONTH Bond Fund Bond Index -------------------------------------------------------------------------------- 12/31/1997 10,000 10,000 01/31/1998 10,115 10,103 02/28/1998 10,065 10,106 03/31/1998 10,070 10,115 04/30/1998 10,001 10,070 05/31/1998 10,196 10,229 06/30/1998 10,228 10,269 07/31/1998 10,236 10,294 08/31/1998 10,423 10,454 09/30/1998 10,560 10,585 10/31/1998 10,535 10,585 11/30/1998 10,560 10,622 12/31/1998 10,569 10,648 01/31/1999 10,706 10,775 02/28/1999 10,635 10,727 03/31/1999 10,641 10,742 04/30/1999 10,659 10,769 05/31/1999 10,578 10,707 06/30/1999 10,381 10,553 07/31/1999 10,399 10,591 08/31/1999 10,287 10,506 09/30/1999 10,270 10,510 10/31/1999 10,136 10,397 11/30/1999 10,238 10,507 12/31/1999 10,139 10,428 01/31/2000 10,078 10,383 02/29/2000 10,182 10,504 03/31/2000 10,411 10,734 04/30/2000 10,358 10,670 05/31/2000 10,309 10,615 06/30/2000 10,541 10,896 07/31/2000 10,668 11,048 08/31/2000 10,834 11,218 09/30/2000 10,824 11,159 10/31/2000 10,924 11,281 11/30/2000 10,895 11,367 12/31/2000 11,143 11,647 01/31/2001 11,242 11,763 02/28/2001 11,406 11,800 03/31/2001 11,529 11,907 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. Rather than stretch for maximum yield, PIMCO's municipal bond team seeks to maximize after-tax total return. The portfolio is scrutinized using a process that models the potential changes in yield and price as the underlying variables of the overall municipal marketplace change. * Past performance is no guarantee of future results. The Fund may invest at least 80% of its assets in debt securities exempt from federal income tax. The Fund may invest 10% of its assets in high yield bonds, lower-rated securities generally involve greater risk to principal than investments in higher-rated securities and may at times invest in derivatives and mortgage related securities. The Fund may invest more than 25% of its assets in bond issuers of California and New York. The Fund may realize gains and shareholders will incur a tax liability from time to time. Income from the Fund is subject to state and local taxes & may at times be subject to the alternative minimum tax. It is important to note that a fund concentrating in a single state is subject to greater risk of adverse economic conditions and regulatory changes than a fund with broader geographical diversification. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 19 A TAX-EXEMPT BOND FUND PIMCO NY Municipal Bond Fund OBJECTIVE: Seek high current income exempt from federal and New York income tax. Capital appreciation is a secondary objective. PORTFOLIO: Primarily intermediate maturity municipal securities (exempt from federal and New York income tax). FUND INCEPTION DATE: 8/31/99 DURATION RANGE: 3-12 years TOTAL NET ASSETS: $4.1 million PORTFOLIO MANAGER: Mark McCray [PHOTO] Mark McCray Portfolio Manager Mr. McCray is responsible for municipal bond portfolios at PIMCO. Previously Co-Head of Municipal Bond Trading at Goldman Sachs & Co., he has over 10 years of investment experience. Fund Highlights . 12.44% return soundly beat Lipper Average. . Fed easing caused municipals to rally, with short-term yields dropping the most. . Focus on higher quality was key to outperformance. . Foresee relatively strong bond market ahead. NY Muni beats benchmark PIMCO NY Municipal Bond Fund delivered strong results for its shareholders, with Class D shares returning 12.44% for the one-year period ended March 31, 2001. This performance beat out the Fund's benchmark, the Lehman NY Insured Municipal Bond Index, which returned 12.13%, and soundly beat the average for its Lipper category, which returned 10.73%. Strong bond market Treasury yields fell this year as the U.S. economy slowed considerably. The Federal Reserve began this period with a rate increase aimed at fighting inflation fears and ended the year with three rate cuts (for a total of 150 basis points) aimed at fighting recession. This environment was generally very favorable for bonds, with high quality bonds typically outperforming lower quality securities. Municipal bonds did very well in this environment, with short-term municipal yields falling further than their longer-term counterparts in response to Fed easings. Issue selection brings results PIMCO Municipal Bond Fund's emphasis on shorter-maturity bonds helped performance as short-maturity NY municipal yields fell further than their longer-term counterparts. The Fund's bias toward high quality issues also enhanced returns as investors focused on credit quality when attempting to counter deteriorating credit and a slowing economy. The Fund's below-benchmark duration for most of the year hurt returns as New York municipal yields fell throughout the course of the year. Economic weakness in the near term We believe that the U.S. economy will continue to struggle over the next two or three quarters, leading a worldwide slowdown. Banks throughout the world, including our own Federal Reserve, will cut interest rates in order to mitigate this slowdown. As a result, New York municipal bonds should continue to produce attractive tax-adjusted returns under weakening U.S. economic growth due to their overall solid credit quality and attractive tax-adjusted yields. In the months ahead, we intend to target the Fund's duration above the benchmark as a weak economy and the prospects for further Fed easing put a cap on short- and intermediate-term municipal yields. We expect to maintain our barbell approach, emphasizing a combination of short-duration issues to take advantage of Fed easing and longer-duration securities to take advantage of attractive risk-adjusted yields. We further hope to maintain our high quality stance in the face of continued economic weakness and credit erosion, but selectively add lower-tier issues where we see value. 20 PIMCO Funds Annual Report | 3.31.01 PIMCO NY Municipal Bond Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (8/31/99) PIMCO NY Municipal Bond Fund D Shares 12.44% -- -- -- 8.83% Lipper New York Intermediate Municipal Debt Fund Average 9.91% -- -- -- -- Lehman Bros. NY Ins. Municipal Bond Index 12.13% -- -- -- -- Lehman Bros. Intermediate NY Ins. Municipal Bond Index 10.73% -- -- -- --
MATURITY PROFILE Less than 1 year 20% 1-5 years 33% 5-10 years 23% 10-20 years 6% 20-30 years 9% Over 30 years 9% Duration 5.4 years SECTOR BREAKDOWN Municipal Bonds & Notes 91.8% Short-Term Instruments 8.2% QUALITY BREAKDOWN AAA 35.1% AA 20.3% A 15.5% BBB 29.1% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] NEW YORK MUNICIPAL BOND FUND Lehman Bros. Lehman Bros. PIMCO NY NY Interm. NY Ins. Municipal Municipal Municipal MONTH Bond D Bond Index Bond Index -------------------------------------------------------------------------------- 08/31/1999 10,000 10,000 10,000 09/30/1999 10,036 10,031 9,987 10/31/1999 9,954 9,983 9,848 11/30/1999 10,041 10,062 9,986 12/31/1999 10,001 10,019 9,883 01/31/2000 9,951 9,983 9,826 02/29/2000 10,013 10,037 9,973 03/31/2000 10,171 10,183 10,227 04/30/2000 10,110 10,146 10,128 05/31/2000 10,073 10,116 10,080 06/30/2000 10,315 10,363 10,407 07/31/2000 10,430 10,499 10,545 08/31/2000 10,641 10,652 10,731 09/30/2000 10,656 10,612 10,665 10/31/2000 10,784 10,707 10,800 11/30/2000 10,849 10,763 10,894 12/31/2000 11,062 10,993 11,235 01/31/2001 11,210 11,176 11,332 02/28/2001 11,295 11,162 11,342 03/31/2001 11,435 11,276 11,467 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. Rather than stretch for maximum yield, PIMCO's municipal bond team seeks to maximize after-tax total return. The portfolio is scrutinized using a process that models the potential changes in yield and price as the underlying variables of the NY municipal marketplace change. * Past performance is no guarantee of future results. The Fund may invest at least 80% of its assets in debt securities exempt from federal income tax. The Fund may invest 10% of its assets in high yield bonds, lower-rated securities generally involve greater risk to principal than investments in higher-rated securities and may at times invest in derivatives and mortgage related securities. The Fund may invest at least 65% of its assets in bond issuers of New York exempt from regular federal income tax and New York income tax. The Fund may realize gains and shareholders will incur a tax liability from time to time. Income from the Fund is subject to state and local taxes & may at times be subject to the alternative minimum tax. It's important to note that a fund concentrating in a single state is subject to greater risk of adverse economic conditions and regulatory changes than a fund with broader geographical diversification. This Fund is non-diversified, which means that it may concentrate its assets in a smaller number of issuers than a diversified Fund. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 21 AN INFLATION-INDEXED BOND FUND PIMCO Real Return Bond Fund OBJECTIVE: Maximum real return, consistent with preservation of real capital and prudent investment management. PORTFOLIO: Primarily inflation-indexed bonds. DURATION RANGE: N/A FUND INCEPTION DATE: 1/29/97 TOTAL NET ASSETS: $899.1 million PORTFOLIO MANAGER: John Brynjolfsson [PHOTO] John Brynjolfsson Portfolio Manager A renowned expert in his field, Mr. Brynjolfsson is co-author of Inflation-Protection Bonds and co-editor of The Handbook of Inflation-Indexed Bonds. He has 15 years of investment experience. Fund Highlights . 13.99% return beat benchmark and Lipper Average. . Treasury Inflation Protection Securities (TIPS) outperformed conventional bonds as the CPI increased more than the markets expected. . TIPS should continue to do well as the U.S. economic slowdown persists in the months ahead. Ahead of the competition PIMCO Real Return Bond Fund continued to deliver strong results to our shareholders in the year ending March 31, 2001. During this time, our 13.99% return for Class D shares topped both the benchmark and the Lipper Short U.S. Government Fund Average. This Fund has now outperformed its Lipper Average for the 1-, 3-year and since-inception periods. Falling real yields support TIPS The U.S. economy slowed considerably over the course of our fiscal year. As evidence, consider that the Federal Reserve began this period with a rate increase aimed at fighting inflation fears. The Fed ended the period with three rate cuts (for a total of 150 basis points) aimed at fighting recession. The net result was that real yields (nominal yield minus inflation) fell by an average of 80 basis points over the year. The yields on short and intermediate issues declined more than the yields on longer-term issues. Treasury Inflation Protection Securities (TIPS) did very well in this environment, outperforming similar maturity conventional bonds. Longer duration strategy on the mark Duration management played an important role in our performance this year. To get the maximum benefit from falling real yields, we maintained a longer-than-benchmark average duration. We also overweighted intermediate maturities, which saw more dramatic yield decreases than longer maturities. The Fund's performance was also helped by our above-benchmark exposure to inflation adjustments. This strategy proved effective as the Consumer Price Index increased more than the markets expected. Our portfolio yield was enhanced through the use of cash-management strategies. High quality corporate securities and asset-backed securities added value over traditional shorter-term investments. Favorable outlook for TIPS We believe the U.S. economy will continue to struggle over the next two to three quarters. We foresee the Federal Reserve easing rates down to 4%, or less, to mitigate the slowdown. TIPS should perform well in this type of market. We will be continuing many of our current strategies for the Fund going forward. We intend to keep the duration of the portfolio above-benchmark, with an overweighting in intermediate-maturity TIPS. This should put us in a strong position when the real yield curve steepens in anticipation of more Fed easing. We will also be minimizing exposure to non-U.S. real return bonds, as U.S. real yields are comparatively high. 22 PIMCO Funds Annual Report | 3.31.01 PIMCO Real Return Bond Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (1/29/97) PIMCO Real Return Bond Fund D Shares 13.99% 9.25% -- -- 7.66% Lipper Short U.S. Government Fund Avg. 9.16% 5.85% -- -- -- Lehman Bros. Inflation Linked Treas. Index 13.70% 7.94% -- -- --
MATURITY PROFILE Less than 1 year 6% 1-5 years 4% 5-10 years 57% 10-20 years 1% 20-30 years 32% Duration 2.0 years SECTOR BREAKDOWN U.S. Treasury Obligations 62.2% Corporate Bonds & Notes 20.6% Short-Term Instruments 11.9% Other 5.3% QUALITY BREAKDOWN AAA 76.5% AA 7.1% A 8.0% BBB 5.0% BB 3.1% B 0.3% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] REAL RETURN FUND Lehman Bros. Infl. PIMCO Real Linked MONTH Return D Treas. Index -------------------------------------------------------------------------------- 01/31/1997 10,000 10,000 02/28/1997 10,031 10,033 03/31/1997 9,938 9,896 04/30/1997 9,996 9,956 05/31/1997 10,053 10,010 06/30/1997 10,028 9,978 07/31/1997 10,149 10,072 08/31/1997 10,167 10,103 09/30/1997 10,183 10,123 10/31/1997 10,308 10,227 11/30/1997 10,359 10,284 12/31/1997 10,302 10,241 01/31/1998 10,359 10,291 02/28/1998 10,344 10,282 03/31/1998 10,364 10,277 04/30/1998 10,417 10,315 05/31/1998 10,456 10,388 06/30/1998 10,489 10,414 07/31/1998 10,566 10,463 08/31/1998 10,570 10,486 09/30/1998 10,812 10,697 10/31/1998 10,865 10,721 11/30/1998 10,846 10,710 12/31/1998 10,796 10,646 01/31/1999 10,951 10,769 02/28/1999 10,923 10,693 03/31/1999 10,985 10,689 04/30/1999 11,163 10,760 05/31/1999 11,240 10,834 06/30/1999 11,223 10,841 07/31/1999 11,239 10,835 08/31/1999 11,293 10,854 09/30/1999 11,337 10,896 10/31/1999 11,355 10,918 11/30/1999 11,439 10,984 12/31/1999 11,369 10,896 01/31/2000 11,434 10,945 02/29/2000 11,514 11,047 03/31/2000 11,857 11,369 04/30/2000 12,004 11,520 05/31/2000 11,967 11,490 06/30/2000 12,123 11,635 07/31/2000 12,215 11,734 08/31/2000 12,327 11,821 09/30/2000 12,425 11,883 10/31/2000 12,554 12,026 11/30/2000 12,735 12,201 12/31/2000 12,851 12,332 01/31/2001 13,176 12,590 02/28/2001 13,417 12,803 03/31/2001 13,517 12,926 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The manager focuses on duration management and manages yield curve exposure based on the firm's outlook for real yields. Although the Fund is mainly invested in U.S. Treasury-Inflation Protection Securities (TIPS), sector rotation allows the manager to invest in other areas where he finds value on an inflation-adjusted basis. * Past performance is no guarantee of future results. The fund may invest up to 35% in foreign securities, which may entail greater risk due to foreign economic and political developments. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 23 AN INTERMEDIATE DURATION BOND FUND PIMCO Short Duration Municipal Income Fund OBJECTIVE: Seeks high current income exempt from Federal income tax consistent with preservation of capital. PORTFOLIO: Short and intermediate maturity municipal securities. DURATION RANGE: 0-2 years FUND INCEPTION DATE: 8/31/99 TOTAL NET ASSETS: $13.7 million PORTFOLIO MANAGER: Mark McCray [PHOTO] Mark McCray Portfolio Manager Mr. McCray is responsible for municipal bond portfolios at PIMCO. Previously Co-Head of Municipal Bond Trading at Goldman Sachs & Co., he has over 10 years of investment experience. Fund Highlights . Fund generated a respectable 5.78% return underperforming Lipper average by a small margin. . Fed easing caused short-term yields to rally, but the Fund's longer-maturity holdings tempered performance. . Quality issue selection boosted returns. . Anticipate a long duration focus amid expected Fed rate cuts. Munis post solid year PIMCO Short Duration Municipal Income Fund Class D shares returned 5.78% for the one-year period ended March 31, 2001. This performance trailed the Fund's benchmark, the Lehman 1-Year Municipal Bond Index, which returned 6.32%, and its Lipper Average, which returned 6.00%. Fed easing hits yields The U.S. economy slowed considerably over the course of our fiscal year. The Federal Reserve began this period with a rate increase aimed at fighting inflation fears and ended the year with three rate cuts (for a total of 150 basis points) aimed at fighting recession. Short-term municipal yields fell by more than 100 basis points over the year in response to the aggressive Fed easing. High-quality bonds typically outperformed lower-quality securities, as investors shunned credit risk amid rising defaults and mounting downgrades in the corporate sector. Issue selection brings results PIMCO Short Duration Municipal Income Fund maintained an above-benchmark duration for most of the year, and this boosted returns as municipal interest rates fell substantially. Quality issue selection also played a key role in increasing returns, helped by our allocation to insured bonds and real return municipal bonds. An emphasis on high-quality issues further enhanced returns as higher-rated credits generally outperformed lower-quality issues. The Fund's above-benchmark holdings of longer-maturity securities hurt performance as shorter-maturity yields fell further than their longer-term counterparts in response to Fed easing. Economic weakness in the near term We believe that the U.S. economy will continue to struggle over the next two or three quarters, leading a worldwide slowdown. Banks throughout the world, including our own Federal Reserve, will cut interest rates in order to mitigate this slowdown. As a result, municipal bonds should produce attractive tax-adjusted returns under weakening U.S. economic growth due to overall solid credit quality in the municipal market and attractive tax-adjusted yields. In the months ahead, we intend to target the Short Duration Municipal Income Fund's duration above the benchmark as slowing growth and further Fed easing puts a cap on short-and intermediate-term municipal yields. We expect to maintain our emphasis on intermediate-term maturities to take advantage of attractive risk-adjusted yields. We further hope to retain our holdings of real return municipal issues, as well as to maintain our high quality stance in the face of continued economic weakness and credit erosion, keeping the Fund's average credit quality at AA. 24 PIMCO Funds Annual Report | 3.31.01 PIMCO Short Duration Muni. Income Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (8/31/99) PIMCO Short Duration Municipal Bond Fund D Shares 5.78% -- -- -- 4.89% Lipper Short Municipal Debt Fund Average 6.00% -- -- -- -- Lehman Bros. 1 yr. Municipal Bond Index 6.32% -- -- -- --
MATURITY PROFILE Less than 1 year 42% 1-5 years 53% 5-10 years 5% Duration 1.88 years SECTOR BREAKDOWN Municipal Bonds & Notes 99.8% Short-Term Instruments 0.2% QUALITY BREAKDOWN AAA 48.3% AA 23.5% A 5.0% BBB 23.2% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] SHORT DURATION MUNICIPAL INCOME FUND PIMCO Short Lehman Bros. 1 yr. Muni. MONTH Duration D Index -------------------------------------------------------------------------------- 08/31/1999 10,000 10,000 09/30/1999 10,027 10,024 10/31/1999 10,047 10,046 11/30/1999 10,076 10,077 12/31/1999 10,099 10,085 01/31/2000 10,137 10,124 02/29/2000 10,152 10,154 03/31/2000 10,195 10,198 04/30/2000 10,207 10,222 05/31/2000 10,222 10,238 06/30/2000 10,288 10,322 07/31/2000 10,339 10,380 08/31/2000 10,396 10,433 09/30/2000 10,445 10,456 10/31/2000 10,512 10,505 11/30/2000 10,537 10,545 12/31/2000 10,644 10,624 01/31/2001 10,700 10,751 02/28/2001 10,748 10,786 03/31/2001 10,786 10,842 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. Rather than stretch for maximum yield, PIMCO's municipal bond team seeks to maximize after-tax total return. The portfolio is scrutinized using a process that models the potential changes in yield and price as the underlying variables of the overall municipal marketplace change. * Past performance is no guarantee of future results. The Fund may invest at least 80% of its assets in debt securities exempt form federal income tax. The Fund may invest at times in derivatives and mortgage related securities. The Fund may invest more than 25% of its assets in bond issuers of California and New York. The Fund may realize gains and shareholders will incur a tax liability from time to time. Income from the Fund is subject to state and local taxes and may at times be subject to the alternative minimum tax. It's important to note that a fund concentrating in a single state is subject to greater risk of adverse economic conditions and regulatory changes than a fund with broader geographical diversification. See page 36 for Footnotes, which include additional details. 3.31.01 | PIMCO Funds Annual Report 25 A SHORT DURATION BOND FUND PIMCO Short-Term Fund OBJECTIVE: Maximum current income, consistent with preservation of capital and daily liquidity. PORTFOLIO: Primarily short-term investment grade bonds. DURATION RANGE: 0-1 year FUND INCEPTION DATE: 10/07/87 TOTAL NET ASSETS: $651.2 million PORTFOLIO MANAGER: Paul McCulley [PHOTO] Paul McCulley Portfolio Manager Mr. McCulley is Managing Director responsible for supervising short-term investment strategies at PIMCO. He has 19 years of investment experience. Fund Highlights . 7.33% return outpaced Lipper Average. . Fund's performance was supported by a strong U.S. bond market. . Above-Index duration boosted returns. . Continued economic weakness bodes well for higher-quality issues. Beating its benchmark I am pleased to report that PIMCO Short-Term Fund delivered strong results for our shareholders, with Class D shares returning 7.33% for the one-year period ended March 31, 2001. The Fund outperformed its benchmark, the Salomon 3-Month Treasury Bill Index, which returned 6.02%, and the Lipper Fund Average for its peers, which returned 7.10%. Bond market shows strength PIMCO Short-Term Fund's total return for the year was supported by one of the stronger bond markets in recent years. With the economy slowing sharply, default rates and downgrades rising in the corporate sector and investors anticipating further aggressive Federal Reserve easing, Treasury securities became the bond investment of choice. As a result, yields fell and higher-quality bonds outperformed lower-quality issues. Longer duration pays off PIMCO Short-Term Fund's emphasis throughout the year on an above-index duration boosted returns, as short-term interest rates fell substantially. In addition, investment-grade corporate holdings added to returns as Fed easing sparked a renewed belief in the economy that allowed corporates to gain ground. With real yields falling, real return bonds also added to relative returns, outperforming like-duration Treasuries. The Fund's small position in below-investment-grade corporate debt hurt performance as corporate profitability eroded and default rates increased. Economic weakness to continue We believe that growth will weaken globally, led by the U.S., which will continue to struggle over the next two or three quarters. We expect to maintain our extended duration position as weaker growth puts a cap on interest rates and benefits bond prices. Longer duration will also offset refinancing risk arising from mortgage holdings, which are expected to remain an emphasis in the portfolio given their relatively high yields and strong credit quality. Additionally, we intend to take advantage of relatively high yield premiums on select short-maturity, high-quality corporate issues. 26 PIMCO Funds Annual Report | 3.31.01 PIMCO Short-Term Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (10/7/87) PIMCO Short-Term Fund D Shares 7.33% 5.84% 6.21% 5.56% 6.19% Lipper Ultra-Short Obligations Fund Avg. 7.10% 5.69% 5.81% 5.43% -- Salomon Brothers 3-Mo. T-bill Index 6.02% 5.29% 5.27% 4.84% --
MATURITY PROFILE Less than 1 year 83% 1-5 years 7% 5-10 years 10% Duration 0.5 years SECTOR BREAKDOWN Corporate Bonds & Notes 35.4% U.S. Treasury Obligations 25.0% Mortgage-Backed Securities 15.9% U.S Government Agencies 13.8% Asset-Backed Securities 5.3% Other 4.6% QUALITY BREAKDOWN AAA 44.4% AA 10.7% A 23.9% BBB 18.3% BB 2.7% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] SHORT-TERM FUND PIMCO Short- Solomon Bros. MONTH Term D 3-month T-Bill -------------------------------------------------------------------------------- 10/31/1987 10,000 10,000 11/30/1987 10,056 10,051 12/31/1987 10,114 10,099 01/31/1988 10,181 10,148 02/29/1988 10,222 10,194 03/31/1988 10,276 10,244 04/30/1988 10,330 10,294 05/31/1988 10,386 10,347 06/30/1988 10,443 10,401 07/31/1988 10,495 10,460 08/31/1988 10,560 10,520 09/30/1988 10,627 10,583 10/31/1988 10,718 10,648 11/30/1988 10,787 10,715 12/31/1988 10,849 10,785 01/31/1989 10,925 10,858 02/28/1989 11,000 10,934 03/31/1989 11,093 11,013 04/30/1989 11,176 11,095 05/31/1989 11,275 11,179 06/30/1989 11,358 11,257 07/31/1989 11,452 11,336 08/31/1989 11,511 11,413 09/30/1989 11,588 11,487 10/31/1989 11,695 11,565 11/30/1989 11,771 11,640 12/31/1989 11,837 11,717 01/31/1990 11,892 11,794 02/28/1990 11,964 11,865 03/31/1990 12,042 11,945 04/30/1990 12,090 12,022 05/31/1990 12,202 12,104 06/30/1990 12,280 12,183 07/31/1990 12,364 12,263 08/31/1990 12,428 12,343 09/30/1990 12,509 12,418 10/31/1990 12,603 12,495 11/30/1990 12,702 12,569 12/31/1990 12,803 12,650 01/31/1991 12,893 12,723 02/28/1991 12,962 12,785 03/31/1991 13,020 12,851 04/30/1991 13,100 12,913 05/31/1991 13,172 12,975 06/30/1991 13,219 13,035 07/31/1991 13,296 13,097 08/31/1991 13,379 13,159 09/30/1991 13,452 13,217 10/31/1991 13,528 13,275 11/30/1991 13,561 13,328 12/31/1991 13,615 13,377 01/31/1992 13,665 13,424 02/29/1992 13,691 13,466 03/31/1992 13,716 13,512 04/30/1992 13,772 13,555 05/31/1992 13,814 13,600 06/30/1992 13,868 13,640 07/31/1992 13,923 13,681 08/31/1992 13,958 13,720 09/30/1992 13,994 13,754 10/31/1992 14,008 13,788 11/30/1992 14,025 13,823 12/31/1992 14,066 13,860 01/31/1993 14,112 13,897 02/28/1993 14,149 13,929 03/31/1993 14,214 13,964 04/30/1993 14,262 13,998 05/31/1993 14,318 14,033 06/30/1993 14,374 14,068 07/31/1993 14,425 14,104 08/31/1993 14,463 14,141 09/30/1993 14,499 14,176 10/31/1993 14,550 14,213 11/30/1993 14,604 14,249 12/31/1993 14,672 14,286 01/31/1994 14,697 14,323 02/28/1994 14,713 14,357 03/31/1994 14,690 14,398 04/30/1994 14,713 14,441 05/31/1994 14,724 14,488 06/30/1994 14,791 14,538 07/31/1994 14,861 14,590 08/31/1994 14,919 14,644 09/30/1994 14,935 14,698 10/31/1994 14,974 14,758 11/30/1994 14,986 14,820 12/31/1994 15,050 14,889 01/31/1995 15,126 14,957 02/28/1995 15,265 15,023 03/31/1995 15,298 15,097 04/30/1995 15,462 15,169 05/31/1995 15,618 15,243 06/30/1995 15,670 15,315 07/31/1995 15,764 15,388 08/31/1995 15,836 15,461 09/30/1995 15,984 15,530 10/31/1995 16,099 15,602 11/30/1995 16,248 15,670 12/31/1995 16,386 15,743 01/31/1996 16,465 15,813 02/29/1996 16,495 15,878 03/31/1996 16,548 15,945 04/30/1996 16,625 16,010 05/31/1996 16,712 16,079 06/30/1996 16,804 16,147 07/31/1996 16,851 16,216 08/31/1996 16,957 16,287 09/30/1996 17,120 16,357 10/31/1996 17,257 16,429 11/30/1996 17,412 16,498 12/31/1996 17,480 16,569 01/31/1997 17,583 16,641 02/28/1997 17,662 16,706 03/31/1997 17,671 16,779 04/30/1997 17,772 16,851 05/31/1997 17,900 16,925 06/30/1997 18,018 16,996 07/31/1997 18,158 17,070 08/31/1997 18,213 17,143 09/30/1997 18,335 17,215 10/31/1997 18,377 17,291 11/30/1997 18,460 17,363 12/31/1997 18,563 17,438 01/31/1998 18,673 17,515 02/28/1998 18,738 17,585 03/31/1998 18,863 17,662 04/30/1998 18,950 17,736 05/31/1998 19,036 17,813 06/30/1998 19,100 17,886 07/31/1998 19,215 17,961 08/31/1998 19,223 18,038 09/30/1998 19,351 18,112 10/31/1998 19,425 18,184 11/30/1998 19,491 18,252 12/31/1998 19,573 18,319 01/31/1999 19,649 18,387 02/28/1999 19,730 18,449 03/31/1999 19,870 18,520 04/30/1999 19,961 18,588 05/31/1999 19,965 18,659 06/30/1999 20,035 18,728 07/31/1999 20,105 18,801 08/31/1999 20,171 18,876 09/30/1999 20,262 18,950 10/31/1999 20,360 19,027 11/30/1999 20,455 19,103 12/31/1999 20,537 19,186 01/31/2000 20,584 19,270 02/29/2000 20,704 19,353 03/31/2000 20,838 19,444 04/30/2000 20,915 19,535 05/31/2000 21,028 19,631 06/30/2000 21,159 19,723 07/31/2000 21,269 19,818 08/31/2000 21,403 19,916 09/30/2000 21,527 20,016 10/31/2000 21,622 20,120 11/30/2000 21,797 20,223 12/31/2000 21,971 20,330 01/31/2001 22,123 20,436 02/28/2001 22,269 20,524 03/31/2001 22,369 20,614 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The Fund then employs a variety of value-added strategies geared to enhance yield, including duration extension, credit quality positioning, cost-effective trading and investment in an expanded set of financial instruments. * Past performance is no guarantee of future results. The fund may invest up to 5% in foreign securities, which may entail greater risk due to foreign economic and political developments. Investment in high yield, lower rated securities generally involves greater risk to principal than investment in higher rated securities. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 27 AN ENHANCED INDEX STOCK FUND PIMCO StocksPLUS Fund OBJECTIVE: Total return which exceeds that of the S&P 500. PORTFOLIO: Primarily S&P 500 Index futures and short-term bonds. DURATION RANGE: 0-1 year FUND INCEPTION DATE: 5/13/93 TOTAL NET ASSETS: $1.0 billion PORTFOLIO MANAGER: Bill Gross [PHOTO] Bill Gross Portfolio Manager Managing Director and co-founder of PIMCO, Mr. Gross is widely regarded as the world's foremost fixed income authority. He has over 30 years of investment experience. Recently, Mr. Gross and the PIMCO bond team were named Morningstar's 2000 Fixed Income Manager of the Year--making them the only two-time winner of the prestigious award. Fund Highlights . Fund slightly outperformed the S&P 500 Index in line with its objective. . Strong bond market helped returns, but couldn't overcome the stock market correction. . High quality bonds should remain the focus this year. What is StocksPLUS? PIMCO StocksPLUS Fund is an enhanced index stock fund that seeks total return in excess of the Standard & Poor's 500 Index (S&P 500) through investment in S&P 500 futures. These futures are purchased with a small percentage of the Fund's assets, freeing the remaining assets for investment in an actively managed portfolio of short-term, investment-grade bonds that can add incremental return beyond that of the S&P 500. S&P 500 melts down As its returns tend to shadow the S&P 500, the Fund had a difficult year, with Class D shares declining 21.27% for the one-year period ended March 31, 2001. This return slightly outperformed the S&P 500, which fell 21.68%, as well as the Lipper Large-Cap Core Fund Average, which fell 22.12%. Bonds can't carry stock wipeout Slow growth in the U.S., combined with three rate cuts by the Federal Reserve, drove Treasury yields down and bond prices up over the past year. That same slow growth, combined with a flight to quality, severely hurt returns in the equity markets. Generally, higher-quality bonds outperformed lower-quality bonds as defaults and downgrades increased within the corporate bond market. Mortgage-backed securities stay strong The StocksPLUS Fund's above-index duration boosted overall returns as short-term interest rates fell significantly. The Fund's fixed-income holdings in higher-quality areas of the bond market like mortgage-backed securities helped performance due to their relatively high yields and lower volatility. Real return bonds also boosted returns as real yields fell. The Fund's modest exposure to lower-quality, high-yield bonds hurt performance as concerns about a slowing economy drove investors to higher-quality areas of the bond market. Economic weakness in the near term We believe that the U.S. economy will continue to struggle over the next two or three quarters, leading a worldwide slowdown. Banks throughout the world, including our own Federal Reserve, will cut interest rates in order to mitigate this slowdown. In general, we expect bonds to perform relatively well in this environment, with higher-quality areas of the bond market doing best as credit deterioration continues amid slower growth. Going forward, we expect to maintain duration at or near the one-year maximum as slowing growth puts a ceiling on rates. This should also help to offset refinancing risk from mortgage holdings, which we expect to continue emphasizing in order to take advantage of relatively high yields and strong credit quality. We also expect to take advantage of relatively high yield premiums on select short-maturity, high-quality corporate issues and continue to favor real return bonds as real yields are expected to decline in the face of slowing global economic activity. 28 PIMCO Funds Annual Report | 3.31.01 PIMCO StocksPLUS Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (5/13/93) PIMCO StockPLUS Fund D Shares -21.27% 2.63% 13.61% -- 15.44% Lipper Large-Cap Core Fund Avg. -22.12% 1.88% 11.64% -- -- S&P 500 Index -21.68% 3.05% 14.18% -- --
MATURITY PROFILE Less than 1 year 39% 1-5 years 61% Duration 1.1 years SECTOR BREAKDOWN Mortgage-Backed Securities 49.7% Corporate Bonds & Notes 19.1% U.S. Treasury Obligations 8.7% Sovereign Issues 7.6% Short-Term Instruments 6.7% Asset-Backed Securities 6.3% Other 1.9% QUALITY BREAKDOWN AAA 74.0% AA 6.4% A 3.4% BBB 11.2% BB 5.0% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] STOCKSPLUS FUND S&P 500 MONTH StocksPLUS D Index -------------------------------------------------------------------------------- 05/31/1993 10,000 10,000 06/30/1993 10,054 10,029 07/31/1993 10,025 9,989 08/31/1993 10,411 10,368 09/30/1993 10,301 10,288 10/31/1993 10,526 10,501 11/30/1993 10,409 10,401 12/31/1993 10,585 10,527 01/31/1994 10,939 10,885 02/28/1994 10,595 10,589 03/31/1994 10,123 10,128 04/30/1994 10,248 10,258 05/31/1994 10,437 10,426 06/30/1994 10,207 10,170 07/31/1994 10,600 10,504 08/31/1994 11,078 10,935 09/30/1994 10,891 10,668 10/31/1994 11,064 10,907 11/30/1994 10,719 10,510 12/31/1994 10,857 10,666 01/31/1995 11,155 10,943 02/28/1995 11,650 11,369 03/31/1995 11,964 11,705 04/30/1995 12,349 12,049 05/31/1995 12,903 12,531 06/30/1995 13,183 12,822 07/31/1995 13,586 13,247 08/31/1995 13,679 13,280 09/30/1995 14,255 13,841 10/31/1995 14,232 13,791 11/30/1995 14,912 14,397 12/31/1995 15,185 14,674 01/31/1996 15,726 15,174 02/29/1996 15,767 15,314 03/31/1996 15,975 15,462 04/30/1996 16,174 15,690 05/31/1996 16,530 16,094 06/30/1996 16,687 16,156 07/31/1996 15,903 15,442 08/31/1996 16,237 15,768 09/30/1996 17,182 16,655 10/31/1996 17,726 17,114 11/30/1996 19,038 18,408 12/31/1996 18,619 18,043 01/31/1997 19,761 19,171 02/28/1997 19,907 19,321 03/31/1997 18,999 18,527 04/30/1997 20,172 19,633 05/31/1997 21,444 20,828 06/30/1997 22,332 21,761 07/31/1997 24,168 23,493 08/31/1997 22,851 22,177 09/30/1997 24,037 23,392 10/31/1997 23,258 22,610 11/30/1997 24,204 23,657 12/31/1997 24,640 24,063 01/31/1998 24,975 24,329 02/28/1998 26,649 26,084 03/31/1998 27,970 27,420 04/30/1998 28,309 27,695 05/31/1998 27,734 27,219 06/30/1998 28,816 28,325 07/31/1998 28,496 28,023 08/31/1998 24,133 23,972 09/30/1998 25,972 25,507 10/31/1998 28,021 27,582 11/30/1998 29,610 29,254 12/31/1998 31,470 30,940 01/31/1999 32,524 32,233 02/28/1999 31,425 31,232 03/31/1999 32,735 32,481 04/30/1999 34,041 33,739 05/31/1999 33,146 32,943 06/30/1999 35,058 34,771 07/31/1999 33,901 33,685 08/31/1999 33,715 33,519 09/30/1999 32,953 32,600 10/31/1999 35,049 34,663 11/30/1999 35,610 35,367 12/31/1999 37,625 37,451 01/31/2000 35,672 35,570 02/29/2000 35,102 34,896 03/31/2000 38,401 38,310 04/30/2000 37,203 37,157 05/31/2000 36,411 36,394 06/30/2000 37,314 37,292 07/31/2000 36,817 36,708 08/31/2000 39,266 38,988 09/30/2000 37,110 36,930 10/31/2000 36,917 36,774 11/30/2000 34,115 33,875 12/31/2000 34,419 34,040 01/31/2001 35,733 35,248 02/28/2001 32,417 32,034 03/31/2001 30,236 30,005 Investment Process -------------------------------------------------------------------------------- Taking an innovative approach, the Fund combines a non-leveraged position in S&P 500 Index futures with an actively managed, short duration fixed-income portfolio. In doing so, the Fund seeks to capture the performance of the S&P 500 Index plus an incremental return based on the fixed income component. The manager adds value primarily through duration management, credit risk management and investment in a variety of high quality, short-term securities. * Past performance is no guarantee of future results. This Fund may invest substantially all of its assets in S&P 500 derivatives, backed by a portfolio of Fixed Income Instruments. The fund may invest up to 20% in foreign securities, which may entail greater risk due to foreign economic and political developments. The Fund may invest up to 10% in high yield securities, lower rated securities generally involves greater risk to principal than investment in higher rated securities, may at times invest in derivatives and mortgage related securities. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 29 A STOCK AND BOND FUND PIMCO Strategic Balanced Fund OBJECTIVE: Maximum total return. PORTFOLIO: S&P 500 Index futures and short-and intermediate-term investment grade bonds. DURATION RANGE: 0-6 years FUND INCEPTION DATE: 6/28/96 TOTAL NET ASSETS: $74.5 million PORTFOLIO MANAGER: Bill Gross [PHOTO] Bill Gross Portfolio Manager Managing Director and co-founder of PIMCO, Mr. Gross is widely regarded as the world's foremost fixed income authority. He has over 30 years of investment experience. Recently, Mr. Gross and the PIMCO bond team were named Morningstar's 2000 Fixed Income Manager of the Year--making them the only two-time winner of the prestigious award. Fund Highlights . Fund outperformed its benchmark for the 1-year period. . Bond holdings tempered stock decline. . Bonds should perform relatively well in the months ahead amidst continued economic weakness. Balance holds steady PIMCO Strategic Balanced Fund is designed to provide broad exposure to both stocks and bonds by investing in a blended portfolio made up of the PIMCO StocksPLUS Fund and PIMCO Total Return Fund. The Fund's Class D shares returned -8.65% for the one-year period ended March 31, 2001, underperforming the Lipper Balanced Fund Average, which returned -6.26%. The Fund did, however, outperform its benchmark--a blend of 60% of the S&P 500 Index and 40% of the Lehman Brothers Aggregate Bond Index--which returned -9.09%. The Fund also outpaced its Lipper Average over the 3-year and since-inception periods. Bond returns beat out stocks Slow growth in the U.S., combined with three rate cuts by the Federal Reserve, drove Treasury yields down and bond prices up over the past year. That same slow growth combined with a flight to quality severely hurt returns in the equity markets. Generally, higher quality bonds outperformed lower quality bonds as defaults and downgrades increased within the corporate bond market. The Fund's asset allocation at the end of the quarter modestly favored stocks, with a 53% weight for stocks and a 47% weight for bonds. Focus on bonds boosts returns The Strategic Balanced Fund's slight overweight toward bonds for much of the year boosted overall returns, while falling interest rates helped the short-term bonds backing its equity exposure. The Fund's fixed-income exposure to higher quality areas of the bond market like mortgage-backed securities helped performance due to their relatively high yields and lower volatility. More importantly, the Fund's substantial underweighting to lower quality, high yield corporate bonds dramatically enhanced returns. Real return bonds also boosted returns as real yields fell. Compared to the benchmark, the Fund's underweight in corporates hurt returns in the first quarter of 2001. For most of the year, however, this strategy proved correct. But, when the Fed began easing rates, we saw a short-lived rally in the corporate bond market. Our minimal exposure meant we did not reap all the benefits of that rally. Additionally, the Fund's small Euro position was slightly negative as the Euro failed to rally against the dollar as U.S. growth slowed and growth in Europe remained solid. Economic weakness in the near term We believe that the U.S. economy will continue to struggle over the next two or three quarters, leading a worldwide slowdown. Banks throughout the world, including our own Federal Reserve, will cut interest rates in order to mitigate this slowdown. In general, we expect bonds to perform relatively well in this environment, with higher quality areas of the bond market doing best as credit deterioration continues amid slower growth. We anticipate targeting a neutral 60/40 percent equity/bond mix in the months ahead in light of stock market volatility and the potential for still further corporate earnings disappointments. In particular, we will extend our fixed-income duration one year above the benchmark and maintain our high quality focus, with an emphasis on short-term Eurozone issues. 30 PIMCO Funds Annual Report | 3.31.01 PIMCO Strategic Balanced Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (6/28/96) PIMCO Strategic Balanced Fund D Shares -8.65% 3.84% -- -- 11.23% Lipper Balanced Fund Average -6.26% 3.26% -- -- -- 60% S&P 500 40% LBAG -9.09% 5.01% -- -- -- S&P 500 Index -21.68% 3.05% -- -- --
SECTOR BREAKDOWN StocksPLUS Fund 55.0% Total Return Fund 39.2% Short-Term Instruments 5.8% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] STRATEGIC BALANCED FUND Lipper PIMCO Strategic 60% S&P 500 Balanced S&P 500 MONTH Balanced D 40% LBAG Fund Avg. Index -------------------------------------------------------------------------------- 06/30/1996 10,000 10,000 10,000 10,000 07/31/1996 9,732 9,746 9,743 9,558 08/31/1996 9,881 9,863 9,896 9,760 09/30/1996 10,348 10,264 10,262 10,309 10/31/1996 10,626 10,525 10,480 10,593 11/30/1996 11,213 11,075 10,968 11,394 12/31/1996 11,007 10,902 10,834 11,168 01/31/1997 11,467 11,324 11,165 11,866 02/28/1997 11,532 11,388 11,206 11,959 03/31/1997 11,156 11,057 10,880 11,468 04/30/1997 11,661 11,520 11,208 12,152 05/31/1997 12,145 11,984 11,666 12,892 06/30/1997 12,504 12,363 12,041 13,470 07/31/1997 13,267 13,086 12,726 14,542 08/31/1997 12,798 12,602 12,322 13,727 09/30/1997 13,255 13,090 12,814 14,479 10/31/1997 13,068 12,904 12,581 13,995 11/30/1997 13,409 13,286 12,811 14,643 12/31/1997 13,611 13,477 13,001 14,895 01/31/1998 13,798 13,635 13,092 15,059 02/28/1998 14,345 14,221 13,611 16,145 03/31/1998 14,823 14,678 14,028 16,972 04/30/1998 14,952 14,797 14,125 17,143 05/31/1998 14,787 14,700 13,982 16,848 06/30/1998 15,216 15,109 14,235 17,533 07/31/1998 15,122 15,025 14,068 17,346 08/31/1998 13,711 13,819 12,856 14,838 09/30/1998 14,513 14,480 13,411 15,789 10/31/1998 15,155 15,156 13,913 17,073 11/30/1998 15,631 15,742 14,422 18,108 12/31/1998 16,218 16,305 14,954 19,151 01/31/1999 16,608 16,760 15,193 19,952 02/28/1999 16,063 16,331 14,829 19,332 03/31/1999 16,585 16,759 15,195 20,105 04/30/1999 16,988 17,170 15,693 20,884 05/31/1999 16,636 16,866 15,452 20,391 06/30/1999 17,252 17,406 15,878 21,522 07/31/1999 16,872 17,051 15,581 20,851 08/31/1999 16,806 16,996 15,418 20,747 09/30/1999 16,627 16,796 15,220 20,179 10/31/1999 17,287 17,459 15,662 21,456 11/30/1999 17,458 17,671 15,831 21,892 12/31/1999 18,013 18,261 16,299 23,181 01/31/2000 17,238 17,687 15,890 22,017 02/29/2000 17,097 17,572 15,852 21,600 03/31/2000 18,169 18,696 16,786 23,713 04/30/2000 17,757 18,337 16,479 22,999 05/31/2000 17,643 18,108 16,324 22,527 06/30/2000 17,890 18,526 16,585 23,083 07/31/2000 17,847 18,420 16,540 22,722 08/31/2000 18,648 19,213 17,278 24,133 09/30/2000 17,992 18,653 16,915 22,859 10/31/2000 17,978 18,655 16,900 22,762 11/30/2000 17,433 17,894 16,286 20,968 12/31/2000 17,644 18,079 16,692 21,070 01/31/2001 18,117 18,583 17,046 21,818 02/28/2001 17,234 17,631 16,384 19,828 03/31/2001 16,598 16,996 15,855 18,572 Investment Process -------------------------------------------------------------------------------- The Strategic Balanced Fund seeks to provide broad exposure to both equity and fixed income classes. The Fund's equity exposure is achieved by investment in the PIMCO StocksPLUS Fund and the fixed income exposure is obtained by investment in the PIMCO Total Return Fund. Allocation decisions are based on PIMCO's consensus economic forecasts of business cycle phases. * Past performance is no guarantee of future results. The fund may invest up to 20% in foreign securities, which may entail greater risk due to foreign economic and political developments. The Fund may invest up to 10% in high yield securities, lower rated securities generally involves greater risk to principal than investment in higher rated securities, may at times invest in derivatives and mortgage related securities. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 31 AN INTERMEDIATE DURATION BOND FUND PIMCO Total Return Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management. PORTFOLIO: Primarily an intermediate-term portfolio of investment grade bonds. DURATION RANGE: 3-6 years FUND INCEPTION DATE: 5/11/87 TOTAL NET ASSETS: $42.5 billion PORTFOLIO MANAGER: Bill Gross [PHOTO] Bill Gross Portfolio Manager Managing Director and co-founder of PIMCO, Mr. Gross is widely regarded as the world's foremost fixed income authority. He has over 30 years of investment experience. Recently, Mr. Gross and the PIMCO bond team were named Morningstar's 2000 Fixed Income Manager of the Year--making them the only two-time winner of the prestigious award. Fund Highlights . 12.44% return soundly beat Lipper Average. . Returns were buoyed by a strong bond market. . Focus on higher quality key to outperformance. . Foresee relatively strong bond market ahead. A very good year I am pleased to report that PIMCO Total Return Fund delivered strong results for our shareholders, with Class D shares returning 12.44% for the one-year period ended March 31, 2001. This performance slightly trailed the Fund's benchmark, but once again soundly beat the Lipper Intermediate Investment-Grade Debt Fund Average. A lift from the market The Fund's performance was supported by one of the strongest bond markets in recent history, with the Lehman Brothers Aggregate Bond Index, a good proxy for the bond market as a whole, up 12.53% for the year ending March 31, 2001. The market thrived on signs of a slowing economy and three Federal Reserve rate cuts totaling 150 basis points. Higher quality focus PIMCO Total Return Fund's focus on higher quality areas of the bond market greatly enhanced performance during this year. In particular, compared to the benchmark, we were overweighted in mortgage-backed securities, which provided relatively high yields and lower market volatility. In addition, our above-average duration for much of the year helped performance as interest rates in general fell. The Fund's corporate bond exposure first helped and then hindered performance for the year. Compared to the benchmark, the Fund was very underweight in lower-quality high-yield corporates. For most of the year, this strategy proved correct. But, when the Fed began easing rates in the first quarter of 2001, we saw a short-lived rally in the corporate bond market. Our minimal exposure meant we did not reap all the benefits of that rally. Bond market should hold steady We believe that the U.S. economy will continue to struggle over the next two to three quarters. We expect bonds to perform relatively well in this environment, although risks of credit erosion remain a very real concern. As for the Fund, we anticipate keeping duration about one year above the benchmark and remaining focused on high quality issues. In terms of sector strategies, we plan to continue overweighting mortgages, which we believe still offer relatively high yields and strong credit quality. We also plan to overweight real return bonds. We expect to underweight the Fund's corporate holdings because of the weaker growth and profit forecasts. But, we will selectively add top-quality corporate issues with compelling valuations. Elsewhere, we will look to increase the Fund's exposure to core European bonds, which should offer value as the economy slows and the European Central Bank eases interest rates. 32 PIMCO Funds Annual Report | 3.31.01 PIMCO Total Return Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (5/11/87) PIMCO Total Return Fund D Shares 12.44% 7.15% 7.98% 8.78% 8.98% Lipper Intermediate Investment Grade Debt Fund Avg. 11.21% 5.86% 6.61% 7.57% -- Lehman Bros. Agg. Bond Index 12.53% 6.88% 7.48% 7.98% --
MATURITY PROFILE Less than 1 year 2% 1-5 years 54% 5-10 years 20% 10-20 years 9% 20-30 years 14% Over 30 years 1% Duration 5.6 years SECTOR BREAKDOWN Mortgage-Backed Securities 50.8% Corporate Bonds & Notes 23.1% U.S. Treasury Obligations 8.9% Short-Term Instruments 7.7% Other 9.5% QUALITY BREAKDOWN AAA 73.5% AA 4.1% A 14.3% BBB 6.9% BB 1.2% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] TOTAL RETURN FUND Lehman Bros. PIMCO Total Agg. Bond MONTH Return D Index -------------------------------------------------------------------------------- 05/31/1987 10,000 10,000 06/30/1987 10,125 10,138 07/31/1987 10,098 10,130 08/31/1987 10,072 10,076 09/30/1987 9,819 9,861 10/31/1987 10,129 10,212 11/30/1987 10,201 10,294 12/31/1987 10,291 10,434 01/31/1988 10,708 10,801 02/29/1988 10,828 10,929 03/31/1988 10,729 10,827 04/30/1988 10,671 10,768 05/31/1988 10,615 10,696 06/30/1988 10,867 10,954 07/31/1988 10,849 10,897 08/31/1988 10,899 10,925 09/30/1988 11,103 11,172 10/31/1988 11,275 11,383 11/30/1988 11,172 11,244 12/31/1988 11,218 11,257 01/31/1989 11,354 11,419 02/28/1989 11,279 11,336 03/31/1989 11,330 11,385 04/30/1989 11,580 11,624 05/31/1989 11,859 11,929 06/30/1989 12,256 12,292 07/31/1989 12,512 12,554 08/31/1989 12,293 12,368 09/30/1989 12,352 12,431 10/31/1989 12,645 12,737 11/30/1989 12,752 12,858 12/31/1989 12,775 12,893 01/31/1990 12,558 12,740 02/28/1990 12,588 12,781 03/31/1990 12,575 12,790 04/30/1990 12,394 12,673 05/31/1990 12,797 13,048 06/30/1990 13,011 13,258 07/31/1990 13,219 13,441 08/31/1990 13,007 13,261 09/30/1990 13,018 13,371 10/31/1990 13,195 13,541 11/30/1990 13,525 13,832 12/31/1990 13,759 14,048 01/31/1991 13,892 14,222 02/28/1991 14,083 14,343 03/31/1991 14,257 14,442 04/30/1991 14,487 14,598 05/31/1991 14,591 14,684 06/30/1991 14,610 14,676 07/31/1991 14,817 14,880 08/31/1991 15,216 15,202 09/30/1991 15,572 15,510 10/31/1991 15,728 15,682 11/30/1991 15,860 15,826 12/31/1991 16,396 16,296 01/31/1992 16,258 16,074 02/29/1992 16,398 16,179 03/31/1992 16,331 16,088 04/30/1992 16,412 16,204 05/31/1992 16,749 16,510 06/30/1992 16,957 16,737 07/31/1992 17,367 17,078 08/31/1992 17,511 17,251 09/30/1992 17,784 17,456 10/31/1992 17,624 17,224 11/30/1992 17,635 17,228 12/31/1992 17,940 17,502 01/31/1993 18,266 17,838 02/28/1993 18,670 18,150 03/31/1993 18,775 18,226 04/30/1993 18,934 18,353 05/31/1993 18,974 18,376 06/30/1993 19,382 18,709 07/31/1993 19,496 18,815 08/31/1993 19,935 19,145 09/30/1993 20,011 19,197 10/31/1993 20,149 19,269 11/30/1993 19,967 19,105 12/31/1993 20,129 19,209 01/31/1994 20,369 19,468 02/28/1994 20,000 19,130 03/31/1994 19,572 18,658 04/30/1994 19,374 18,509 05/31/1994 19,277 18,507 06/30/1994 19,202 18,466 07/31/1994 19,592 18,832 08/31/1994 19,643 18,856 09/30/1994 19,390 18,578 10/31/1994 19,362 18,562 11/30/1994 19,361 18,521 12/31/1994 19,349 18,648 01/31/1995 19,691 19,017 02/28/1995 20,148 19,470 03/31/1995 20,336 19,589 04/30/1995 20,687 19,863 05/31/1995 21,337 20,631 06/30/1995 21,320 20,783 07/31/1995 21,326 20,736 08/31/1995 21,651 20,986 09/30/1995 21,917 21,191 10/31/1995 22,243 21,466 11/30/1995 22,719 21,788 12/31/1995 23,106 22,094 01/31/1996 23,290 22,240 02/29/1996 22,718 21,854 03/31/1996 22,536 21,702 04/30/1996 22,437 21,580 05/31/1996 22,372 21,536 06/30/1996 22,725 21,825 07/31/1996 22,780 21,885 08/31/1996 22,754 21,848 09/30/1996 23,271 22,229 10/31/1996 23,869 22,721 11/30/1996 24,428 23,111 12/31/1996 24,117 22,896 01/31/1997 24,202 22,966 02/28/1997 24,250 23,023 03/31/1997 23,950 22,768 04/30/1997 24,376 23,109 05/31/1997 24,620 23,327 06/30/1997 24,903 23,604 07/31/1997 25,592 24,240 08/31/1997 25,365 24,034 09/30/1997 25,771 24,388 10/31/1997 26,075 24,742 11/30/1997 26,189 24,856 12/31/1997 26,491 25,106 01/31/1998 26,896 25,428 02/28/1998 26,815 25,408 03/31/1998 26,898 25,497 04/30/1998 26,998 25,630 05/31/1998 27,306 25,873 06/30/1998 27,565 26,092 07/31/1998 27,650 26,148 08/31/1998 28,085 26,573 09/30/1998 28,919 27,196 10/31/1998 28,716 27,052 11/30/1998 28,817 27,205 12/31/1998 28,987 27,287 01/31/1999 29,155 27,482 02/28/1999 28,613 27,002 03/31/1999 28,850 27,152 04/30/1999 28,986 27,238 05/31/1999 28,667 26,999 06/30/1999 28,612 26,913 07/31/1999 28,498 26,799 08/31/1999 28,515 26,785 09/30/1999 28,826 27,096 10/31/1999 28,915 27,196 11/30/1999 28,976 27,194 12/31/1999 28,817 27,063 01/31/2000 28,664 26,974 02/29/2000 29,011 27,300 03/31/2000 29,431 27,660 04/30/2000 29,343 27,581 05/31/2000 29,331 27,568 06/30/2000 29,944 28,142 07/31/2000 30,214 28,397 08/31/2000 30,682 28,809 09/30/2000 30,783 28,990 10/31/2000 30,971 29,182 11/30/2000 31,569 29,659 12/31/2000 32,203 30,209 01/31/2001 32,667 30,703 02/28/2001 32,974 30,971 03/31/2001 33,100 31,126 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO investment professionals develop a 3 to 5-year outlook for the global economy and interest rates. Quarterly meetings are then held to forecast specific influencing factors, including interest rate volatility, yield curve movements and credit trends. Taken together, these sessions set the basic portfolio parameters. Bottom-up strategies are then meshed with the top-down strategies to create value. * Past performance is no guarantee of future results. The fund may invest up to 20% in foreign securities, which may entail greater risk due to foreign economic and political developments. Investment in high yield, lower rated securities generally involves greater risk to principal than investment in higher rated securities. Mortgage-backed securities may be sensitive to changes in prevailing interest rates, when they rise the value generally declines. There is no assurance that the private guarantors or insurers will meet their obligations. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 33 AN INTERMEDIATE DURATION BOND FUND PIMCO Total Return Mortgage Fund OBJECTIVE: Maximum total return, consistent with preservation of capital and prudent investment management. PORTFOLIO: Primarily mortgage-backed securities. DURATION RANGE: 2-6 years FUND INCEPTION DATE: 7/31/97 TOTAL NET ASSETS: 25.1 million PORTFOLIO MANAGER: Scott Simon [PHOTO] Scott Simon Portfolio Manager An acclaimed expert in his field, Mr. Simon is head of mortgage securities at PIMCO and is a senior member of its portfolio management and investment strategy groups. He has 18 years of investment experience. Fund Highlights . 12.69% return surpassed benchmark and Lipper Average. . Slowing U.S. economy was positive for bond performance. . Above-index duration helped relative return. . Continued economic weakness bodes well for high-quality mortgages, especially GNMA issues. Returns outpace benchmark PIMCO Total Return Mortgage Fund Class D shares returned 12.69% for the one-year period ended March 31, 2001. This performance surpassed our benchmark and the Lipper U.S. Mortgage Fund Average. The Fund also outperformed its Lipper Average for the 3-year and since-inception periods. Strong bond market The U.S. economy slowed considerably over the year ending March 31, 2001. While we started this period with the Fed raising rates on inflation fears, we ended with three consecutive rate cuts (for a total of 150 basis points). This environment was generally very favorable for bonds. But, we also saw downgrades and defaults, driving investors toward higher-quality securities. As for the mortgage-backed market, the lower rates encouraged homeowners to refinance, increasing the risk of prepayment. We believe, however, that the additional yield offered by mortgage-backed securities offsets that risk. Longer duration boosts return To get the maximum benefit from falling rates, we kept the Fund's duration slightly longer than its benchmark. This strategy was instrumental in helping us to outperform our benchmark. Protecting ourselves against prepayment risk was also a significant factor in our relative performance last year. For example, our investments in Commercial Mortgage Backed Securities (CMBS) enhanced returns, because these securities are less vulnerable to prepayment risk. The Fund's relative performance was hindered slightly by our GNMA investments, at the expense of Freddie Mac and Fannie Mae. Our strategy was based on investors' concerns that the federal government would restrict the activities of Freddie Mac and Fannie Mae. These concerns abated, however, and these issues actually outperformed GNMA. Quality is the watchword We believe that the U.S. economy will continue to struggle over the next several quarters. Banks worldwide will most likely ease rates to mitigate this slowdown, including our own Federal Reserve. In general we expect bonds to perform relatively well in this environment, with higher-quality areas doing best. Our strategy for the Fund in this type of market is to maintain our above-index duration and our focus on quality. In terms of specific sector plays, we intend to stay overweighted in GNMA securities, as their government guaranty becomes more valuable when credit quality is deteriorating. These securities also add yield during a period of decreasing interest rates. 34 PIMCO Funds Annual Report | 3.31.01 PIMCO Total Return Mortgage Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 year 5 year 10 year Inception (7/31/97) PIMCO Total Return Mortgage Fund D Shares 12.69% 7.27% -- -- 7.72% Lipper U.S. Mortgage Fund Avg. 11.48% 6.08% -- -- -- Lehman Brothers Mortgage Index 12.64% 6.97% -- -- --
MATURITY PROFILE Less than 1 year 7% 1-5 years 68% 5-10 years 20% 10-20 years 2% 20-30 years 2% Over 30 years 1% Duration 3.2 years SECTOR BREAKDOWN Mortgage-Backed Securities 83.4% Short-Term Instruments 15.3% Other 1.3% QUALITY BREAKDOWN AAA 97.1% AA 2.9% CHANGE IN VALUE For periods ended 3/31/01 [GRAPH] TOTAL RETURN MORTGAGE FUND PIMCO Total Return Mort. Lehman MONTH Fund D Mortgage Index -------------------------------------------------------------------------------- 07/31/1997 10,000 10,000 08/31/1997 10,007 9,976 09/30/1997 10,162 10,103 10/31/1997 10,310 10,215 11/30/1997 10,356 10,248 12/31/1997 10,475 10,342 01/31/1998 10,587 10,445 02/28/1998 10,604 10,467 03/31/1998 10,641 10,511 04/30/1998 10,711 10,570 05/31/1998 10,801 10,641 06/30/1998 10,869 10,691 07/31/1998 10,910 10,746 08/31/1998 11,038 10,843 09/30/1998 11,160 10,974 10/31/1998 11,113 10,960 11/30/1998 11,159 11,015 12/31/1998 11,187 11,061 01/31/1999 11,253 11,140 02/28/1999 11,192 11,096 03/31/1999 11,262 11,170 04/30/1999 11,315 11,222 05/31/1999 11,252 11,159 06/30/1999 11,237 11,120 07/31/1999 11,193 11,045 08/31/1999 11,184 11,044 09/30/1999 11,324 11,223 10/31/1999 11,386 11,288 11/30/1999 11,439 11,294 12/31/1999 11,411 11,267 01/31/2000 11,335 11,169 02/29/2000 11,502 11,298 03/31/2000 11,653 11,422 04/30/2000 11,611 11,430 05/31/2000 11,603 11,435 06/30/2000 11,817 11,680 07/31/2000 11,931 11,755 08/31/2000 12,126 11,933 09/30/2000 12,245 12,056 10/31/2000 12,327 12,143 11/30/2000 12,523 12,326 12/31/2000 12,759 12,524 01/31/2001 12,957 12,719 02/28/2001 13,075 12,792 03/31/2001 13,135 12,866 Investment Process -------------------------------------------------------------------------------- The top-down investment process starts with an annual secular forum at which PIMCO develops a 3 to 5-year outlook for the global economy and interest rates. This helps set the basic portfolio parameters. The manager then seeks to add value primarily through interest rate strategies and by exploiting many areas of the mortgage market. PIMCO's advanced proprietary analytics are critical to issue selection and risk management. * Past performance is no guarantee of future results. This Fund concentrates on investments in mortgage securities, which may entail greater risk than a fully diversified fund. The Fund may invest in U.S. dollar-denominated securities of foreign issuers, securities less than AAA ratings but not lower than BBB ratings and may invest in derivative instruments. See page 36 for additional footnotes, which include additional information. 3.31.01 | PIMCO Funds Annual Report 35 Footnotes The following notes and definitions should help provide a more complete understanding of the performance figures. Past performance is no guarantee of future results. Investment return will fluctuate and the value of an investor's shares will fluctuate and may be worth more or less than original cost when redeemed. The average annual total return measures performance assuming that all dividend and capital gain distributions were reinvested. Emerging Markets Bond, Global Bond II & Real Return Bond Fund Instl. shares and Class D shares commenced operations on the same day, but for the rest of the PIMS Funds the returns represent the blended performance of the Fund's Class D shares and the prior performance of the Fund's Institutional shares, adjusted, as necessary, to reflect Class D share current sales charges and different operating expenses. The Class D shares were first offered in 4/98 for the PIMS Funds except CA Intermediate Municipal D on 1/00, CA Muni D on 5/00, NY Municipal D on 1/00 and Short-Duration Municipal on 1/00. The credit quality of the investment in the portfolio does not apply to the stability or safety of the fund. Duration is a measure of the Fund's price sensitivity expressed in years. The Growth of $10,000 does include the effect of the maximum initial sales charge only associated with class A shares. Money market funds are neither insured nor guaranteed by FDIC or any other government agency and there can be no assurance that any money market fund will be able to maintain a net asset value of $1.00 per share. Savings accounts & CD's are guaranteed as to repayment of principal and interest by an agency of the U.S. government. However, the investment return and principal value of bonds and bond funds will fluctuate. The Lipper Averages are calculated by Lipper, Inc. It is the total return performance average of funds that are tracked by Lipper that have the same Fund Classification. Lipper does not take into account sales charges. Lehman CA Intermediate Index is an unmanaged index comprised of California Municipal Bond issues with a maturity range of 5-10 Years. Lehman CA Insured Muni. is an unmanaged index comprised of insured California Municipal Bond Issues. First Boston Convertible Bond Index is an unmanaged market index comprised of convertible bonds. J.P. Morgan Emerging Markets Bond Index tracks total returns for Brady Bonds. Countries covered are Argentina, Brazil, Bulgaria, Ecuador, Mexico, Nigeria, Panama, Peru, Poland and Venezuela. J.P. Morgan Non-U.S. (Hedged) is an unmanaged market index representative of the total return performance in U.S. dollars of major non-U.S. bond markets. J.P. Morgan Global (Hedged) is an unmanaged market index representative of the total return performance in U.S. dollars on a hedged basis of major world bond markets. Lehman Intermediate BB High Yield is an unmanaged market index comprised of various fixed income securities rated BB. Lehman Long Term Treasury is an unmanaged index comprised of various fixed income maturities greater than 10 years. Merrill Lynch 1-3 Yr. Treasury is an unmanaged market index made up of U.S. Treasury issues with maturities from 1-3 years. Salomon 3-month T-bill is an unmanaged index representing monthly return equivalents of yield averages of the last 3-month Treasury Bill issues. Lehman General Municipal is an unmanaged index representative of the tax-exempt bond market. The index is made up of all investment grade municipal bonds issued after 12/31/90 having a remaining maturity of at least one-year. Lehman NY Insured Muni is an unmanaged index comprised of insured New York Municipal Bond issues. Lehman Inflation Linked Treasury is an unmanaged market index comprised of all U.S. Inflation Linked Treasuries. S&P 500 Index is an unmanaged market index generally considered to be representative of the stock market as a whole. 60% S&P/ 40% LBAG is an unmanaged index comprised of 60% of the return of the S&P 500 Index and 40% of the Lehman Brothers Aggregate Bond Index. Lehman Aggregate Bond is an unmanaged market index representative of the U.S. Taxable fixed income universe. Lehman Mortgage is an unmanaged market index representing fixed rate mortgage issued by GNMA, FNMA and FHLMC. It is not possible to invest directly in an unmanaged index. The funds also offer other share classes, which are subject to different fees and expenses (which may affect performance), have different minimum investment requirements and are entitled to different services. Information regarding such classes may be obtained by calling 1-888-87-PIMCO. For additional details on the Funds, contact your financial advisor to receive a current prospectus that contains more complete information, including charges and expenses. Please read the prospectus carefully before you invest or send money. PIMCO Funds Distributors LLC, 2187 Atlantic Street, Stamford, CT, 06902, www.pimcofunds.com, 1-888-87-PIMCO. 36 PIMCO Funds Annual Report | 3.31.01 PIMCO Schedule of Investments Class D California Intermediate Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 100.4% -------------------------------------------------------------------------------- California 75.1% A B C California Unified School District General Obligation, (FGIC Insured), Series 2000 0.000% due 08/01/2029 $ 1,715 $ 384 A B C California Unified School District General Obligation, (FGIC Insured), Series 2001 0.000% due 08/01/2026 1,600 422 0.000% due 08/01/2027 1,145 286 0.000% due 08/01/2028 1,310 310 0.000% due 08/01/2030 1,850 390 0.000% due 08/01/2031 1,285 257 0.000% due 08/01/2032 1,965 373 0.000% due 08/01/2033 1,670 300 0.000% due 08/01/2034 1,755 299 Alameda, California Harbor Bay Business Park Assessment Revenue Bonds, Series 1998 5.500% due 09/02/2012 3,500 3,506 Anaheim, California Public Financing Authority Revenue Bonds, (AMBAC Insured), Series 1999 4.625% due 10/01/2027 150 157 Antioch, California Public Financing Authority Reassessment Revenue Bonds, Series 1998-B 5.500% due 09/02/2008 495 509 California Educational Facilities Authority Revenue Bonds, Series 1997-A 5.700% due 10/01/2015 135 146 California Health Facilities Financing Authority Revenue Bonds, (CA MTG Insured), Series 2000 5.000% due 09/01/2010 350 366 California Health Facilities Financing Authority Revenue Bonds, (MBIA Insured), Series 1998-A 5.375% due 08/15/2030 1,100 1,117 California Health Facilities Financing Authority Revenue Bonds, Series 1998-B 5.250% due 10/01/2014 3,000 3,025 California Housing Financial Agency Revenue Bonds, (AMBAC FHA Insured), Series 1996 5.950% due 02/01/2011 100 108 California Pollution Central Financing Authority Revenue Bonds, (MBIA Insured), Series 1996 5.350% due 12/01/2016 1,000 1,013 California Pollution Control Financing Authority Revenue Bonds, Series 1999-A 4.500% due 08/01/2003 150 152 California State Department of Water Resources Central Valley Project Revenue Bonds, Series 1993 5.700% due 12/01/2016 1,750 1,829 California State Department Veteran Affairs Home Revenue Bonds, Series 2000-B 4.900% due 12/01/2005 500 507 California State General Obligation Bonds, (FGIC Insured), Series 1997 5.000% due 10/01/2004 325 343 California State General Obligation Bonds, (MBIA Insured), Series 1991 6.600% due 02/01/2011 1,000 1,187 California State General Obligation Bonds, (MBIA Insured), Series 1992 7.500% due 10/01/2007 400 482 California State General Obligation Bonds, Series 1991 6.500% due 09/01/2010 1,730 2,037 California State General Obligation Bonds, Series 1997-BL 5.300% due 12/01/2012 400 421 California State General Obligation Bonds, Series 2000 5.250% due 03/01/2005 100 106 5.250% due 03/01/2013 300 318 5.700% due 12/01/2032 1,775 1,811 6.310% due 01/01/2027 (d) 1,500 1,435 California State General Obligation Bonds, Series 2001 5.500% due 03/01/2012 2,000 2,183 5.125% due 03/01/2031 500 497 California State Public Works Board Lease Revenue Bonds, Series 1994-A 6.375% due 11/01/2014 500 560 California Statewide Communities Development Authority Apartment Development Revenue Bonds, Series 1998-A-3 5.100% due 05/15/2025 2,000 2,010 California Statewide Communities Development Authority Certificates of Participation, (AMBAC Insured), Series 1995 3.600% due 07/01/2015 (d) 1,100 1,100 California Statewide Communities Development Authority Certificates of Participation, Series 1994 6.500% due 07/01/2015 1,000 1,115 California Statewide Communities Development Authority Revenue Bonds, Series 2001 5.125% due 10/01/2030 1,950 1,925 Capistrano, California Unified School District Community Facilities District Special Tax Bonds, Series 1997 7.100% due 09/01/2021 2,000 2,357 Capistrano, California Unified School District Community Facilities District Special Tax Bonds, Series 1999 5.700% due 09/01/2020 1,500 1,483 Chico, California Public Financing Authority Revenue Bonds, (FSA Insured), Series 1996 5.200% due 04/01/2011 485 512 Chula Vista, California Special Tax Bonds, Series 2000-1 6.350% due 09/01/2017 230 239 6.400% due 09/01/2018 120 124 Corona, California Community Facilities District Special Tax Bonds, Series 1998 5.875% due 09/01/2023 1,000 996 East Bay, California Municipal District Wastewater Treatment System Revenue, Series 1993 5.550% due 06/01/2020 (d) 6,000 6,328 East Bay, California Municipal Utility District Wastewater Treatment System Revenue Bonds, (AMBAC Insured), Series 1993 6.420% due 06/01/2013 3,450 3,749 East Bay, California Regional Park District General Obligation Bonds, Series 1998 5.000% due 09/01/2017 2,000 2,025 Evergreen, California School District General Obligation Bonds, (FGIC Insured), Series 2000-C 10.000% due 09/01/2005 465 586 10.000% due 09/01/2006 380 497 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 37 PIMCO Schedule of Investments Class D (Cont.) California Intermediate Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, Series 1995 0.000% due 01/01/2026 $ 1,000 $ 272 Foothill Eastern Transportation Corridor Agency Toll Road Revenue Bonds, (MBIA Insured), Series 1999 5.875% due 01/15/2027 2,500 1,630 Fresno, California Special Tax, Series 1998 4.750% due 09/01/2005 980 983 Livermore Valley, California Joint Unified School District General Obligation Bonds, (MBIA Insured), Series 2000 6.500% due 08/01/2003 1,000 1,073 Livermore-Amador Water Management Agency California Revenue Bonds, (AMBAC Insured), Series 2001 5.000% due 08/01/2031 3,500 3,441 Long Beach, California Harbor Revenue Bonds, (MBIA Insured), Series 1995 6.500% due 05/15/2005 220 243 Long Beach, California Harbor Revenue Bonds, Series 1993 4.700% due 05/15/2004 150 155 Los Angeles County, California Transportation Commission Certificates of Participation, Series 1992-B 6.250% due 07/01/2004 500 527 Los Angeles, California Community Redevelopment Agency Certificates of Participation Revenue Bonds, Series 1984 7.550% due 11/01/2008 390 435 Los Angeles, California State Building Authority Lease Revenue Bonds, Series 1999-A 4.600% due 10/01/2007 150 157 Los Angeles, California Unified School District General Obligation Bonds, (MBIA Insured), Series 1999-C 4.750% due 07/01/2010 30 32 Metropolitan Water District Southern California General Obligation Bonds, Series 1993-A1 7.250% due 03/01/2007 150 177 Metropolitan Water District Southern California Revenue Bonds, Series 1993 6.050% due 10/30/2020 (d) 600 623 Orange County, California Community Facilities District Special Tax, Series 2000 5.600% due 08/15/2011 455 460 5.700% due 08/15/2012 485 490 5.800% due 08/15/2013 600 604 6.200% due 08/15/2018 1,025 1,033 Orange County, California Local Transportation Authority Sales Tax Revenue Bonds, (AMBAC-TCRS Insured), Series 1992 6.200% due 02/14/2011 3,250 3,816 Orange County, California Revenue Bonds, (MBIA Insured), Series 1995-A 6.000% due 06/01/2010 1,000 1,148 Oxnard, California Improvement Bond Act 1915 Special Assessment, Series 1997 5.500% due 09/02/2004 1,205 1,232 Pacific Housing & Finance Agency, California Revenue Bonds, (MBIA Insured), Series 1999 4.625% due 12/01/2004 250 259 Pioneers Memorial Healthcare District, California General Obligation Bonds, (AMBAC Insured), Series 1998 5.125% due 10/01/2024 1,000 999 Port of Oakland, California Revenue Bonds, (FGIC Insured), Series 2000 5.500% due 11/01/2009 500 546 Rancho, California Water District Financing Authority Revenue Bonds, (FGIC Insured), Series 1995 5.875% due 11/01/2010 900 989 Redding, California Electric System Revenue Certificates of Participation, (FGIC Insured), Series 1993 5.684% due 06/28/2019 500 516 Riverside County, California Asset Leasing Corp. Revenue Bonds, (MBIA Insured), Series 2000 5.200% due 11/01/2010 250 273 Sacramento County, California Sanitation District Financing Authority Revenue Bonds, Series 2000-A 4.900% due 12/01/2007 1,000 1,068 5.100% due 12/01/2009 1,000 1,082 5.100% due 12/01/2010 1,000 1,083 Sacramento, California Municipal Utility District Electric Revenue, Series 1993 5.300% due 11/15/2005 2,500 2,649 Sacramento, California Municipal Utility District Revenue Bonds, Series 1983-M 9.000% due 04/01/2013 960 1,287 San Francisco, California City & County Airport Commission International Airport Revenue Bonds, (FGIC Insured), Series 1996-12-A 5.625% due 05/01/2005 400 428 San Francisco, California City & County Airport Commission International Airport Revenue Bonds, (FSA Insured), Series 1998-16A 5.500% due 05/01/2015 300 315 San Francisco, California City & County Airport Commission International Airport Revenue Bonds, (MBIA Insured), Series 1996-14A 8.000% due 05/01/2005 500 578 San Francisco, California City & County Airport Common International Airport Revenue Bonds, Series 1998 4.500% due 05/01/2026 1,750 1,584 San Jose, California Multifamily Housing Revenue Bonds, (LOC-Bay View Bank N.A. & LOC-Federal Home Loan Bank Insured), Series 1999 4.950% due 06/01/2039 1,000 1,046 San Jose, California Redevelopment Agency Tax Allocation, (MBIA Insured), Series 1993 6.000% due 08/01/2010 600 690 San Pablo, California Redevelopment Agency Revenue Bonds, Series 1979 8.000% due 10/01/2011 135 160 Santa Margarita/Dana Point Authority, California Revenue Bonds, (MBIA Insured), Series 1994-A 7.250% due 08/01/2006 150 176 South Tahoe, California Joint Powers Financing Authority Revenue Bonds, Series 1999-A 7.300% due 10/01/2007 150 154 Stockton, California Certificates of Participation, Series 1999 4.750% due 08/01/2006 120 125 West Sacramento California Import Bridge Act 1915, Series 1998 4.800% due 09/02/2002 1,160 1,166 Western Riverside County, California Regional Wastewater Authority Revenue Bonds, (LOC-Dexia Credit Local France), Series 1996 3.600% due 04/01/2028 1,400 1,400 ----------- 88,986 ----------- 38 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Illinois 1.3% Illinois Educational Facilities Authority Revenues, Series 1993 1.000% due 07/01/2012 $ 1,400 $ 1,499 ----------- New Hampshire 2.3% New Hampshire Health & Educational Facilities Authority Revenue Bonds, (AMBAC Insured), Series 2002 5.250% due 07/01/2014 2,690 2,748 ----------- Puerto Rico 17.7% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 5.750% due 07/01/2020 5,000 5,182 Puerto Rico Commonwealth Aqueduct & Sewer Authority Revenue Bonds, (FSA Surety Bond Insured), Series 1985-A 9.000% due 07/01/2009 3,000 3,497 Puerto Rico Commonwealth General Obligation Bonds, (MBIA Insured), Series 1995 5.200% due 07/01/2006 410 441 Puerto Rico Commonwealth Highway & Transportation Authority Revenue Bonds, Series 1993-X 5.200% due 07/01/2003 500 518 5.350% due 07/01/2005 5,000 5,233 Puerto Rico Commonwealth Infrastructure Financing Authority Revenue Bonds, (AMBAC Insured), Series 1998-A 5.250% due 07/01/2010 150 163 Puerto Rico Electric Power Authority Power Revenue Bonds, Series 1995-X 6.125% due 07/01/2021 500 559 Puerto Rico Industrial Tourist Educational, Medical & Environmental Control Facilities Revenue Bonds, Series 2000 5.300% due 11/15/2005 250 260 Puerto Rico Industrial Tourist Environmental Central Facilities Revenue Bonds, Series 2000 5.300% due 11/15/2004 150 155 Puerto Rico Municipal Finance Agency General Obligation Bonds, (FSA Insured), Series 1999-A 5.000% due 08/01/2004 1,000 1,050 Puerto Rico Public Finance Corp. Revenue Bonds, (AMBAC Insured), Series 1998-A 5.000% due 06/01/2007 500 535 University of Puerto Rico Revenues Bonds, (MBIA Insured), Series 1995 6.250% due 06/01/2006 3,000 3,368 ----------- 20,961 ----------- Virgin Islands 4.0% Virgin Islands Public Finance Authority Revenue Bonds, Series 1998-C 5.500% due 10/01/2008 3,000 3,197 5.500% due 10/01/2007 1,500 1,599 ----------- 4,796 ----------- Total Municipal Bonds & Notes 118,990 (Cost $113,888) ----------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.2% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities 3.625% due 07/15/2002 (b)(c) 219 223 ----------- Total U.S. Treasury Obligations 223 (Cost $219) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 0.2% -------------------------------------------------------------------------------- Money Market Fund 0.2% Reich & Tang California Money Market(12,497) 2.630% due 04/02/2001 $ 267 $ 267 ----------- Total Short-Term Instruments 267 (Cost $267) ----------- Total Investments (a) 100.8% $ 119,480 (Cost $114,374) Other Assets and Liabilities (Net)(0.8%) (1,016) ----------- Net Assets 100.0% $ 118,464 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $114,374 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 5,137 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (31) ----------- Unrealized appreciation-net $ 5,106 ----------- (b) Securities with an aggregate market value of $223 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts Appreciation -------------------------------------------------------------------------------- U.S. Treasury 30 Year Bond (06/2001) 50 $ 92 ------------ (c) Principal amount of the security is adjusted for inflation. (d) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 39 PIMCO Schedule of Investments Class D California Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 95.6% -------------------------------------------------------------------------------- California 65.3% California Health Facilities Financing Authority Revenue Bonds, Series 1998 3.800% due 09/01/2028 $ 100 $ 100 California Pollution Control Financing Authority Revenue Bonds, Series 1991 3.600% due 10/01/2011 (d) 300 300 California State Department Water Center Revenue Bonds, Series 1993 8.375% due 12/01/2003 150 169 California State General Obligation, Series 2001 5.125% due 03/01/2031 625 621 California Statewide Communities Development Authority Revenue Bonds, Series 2001 5.125% due 10/01/2030 400 395 Capistrano, California Unified School District Community Facilities District Special Tax Bonds, Series 1999 5.700% due 09/01/2020 400 395 Chula Vista, California Special Tax Bonds, Series 2000-1 6.400% due 09/01/2018 125 130 Corona, California Community Facilities District Special Tax Bonds, Series 1998 5.875% due 09/01/2023 150 149 East Bay, California Municipal Utility District Wastewater Treatment System Revenue Bonds, (AMBAC Insured), Series 1993 6.420% due 06/01/2013 (d) 400 435 Foothill Eastern Transportation Corridor Agency Toll Road Revenue Bonds, (MBIA Insured), Series 1999 0.000% due 01/15/2027 500 326 Irvine Ranch California Water District Certificate Participation, (LOC-Toronto Dominio Bank Insured), Series 1986 3.600% due 08/01/2016 (d) 300 300 Livermore-Amador Water Management Agency California Revenue Bonds, (AMBAC Insured), Series 2001 5.000% due 08/01/2031 200 197 Los Angeles County, California Transportation Commission Certificates of Participation, Series 1992-B 6.250% due 07/01/2004 500 527 Los Angeles County, Caliifornia Metropolitan Transportation Authority Sales Tax Revenue Bonds, Series 1999 4.750% due 07/01/2026 500 472 Los Angeles, California Department of0 Water & Power Waterworks Revenue Bonds, (MBIA Insured), Series 1994 6.375% due 07/01/2034 350 387 Metropolitan Water District Southern California Revenue Bonds, Series 1993 6.370% due 10/30/2020 (d) 200 207 Orange County, California Local Transportation Authority Sales Tax Revenue Bonds, (AMBAC-TCRS Insured), Series 1992 6.200% due 02/14/2011 750 881 Orange County, California Revenue Bonds, (MBIA Insured), Series 1995-A 6.000% due 06/01/2010 400 459 Orange County, California Santa Ana District Certificate Participation, (SPA-DEXIA Public Finance Insured), Series 2000 3.600% due 08/01/2030 (d) 400 400 Pioneers Memorial Healthcare District, California General Obligation Bonds, (AMBAC Insured), Series 1998 5.125% due 10/01/2024 400 400 San Francisco, California City & County Airport Common International Airport Revenue Bonds, Series 1998 4.500% due 05/01/2026 500 453 San Jose, California Redevelopment Agency Tax Allocation, (MBIA Insured), Series 1993 6.000% due 08/01/2010 300 345 Southern California Public Power Authority Revenue Bonds, (FSA-CR Insured), Series 1993 5.000% due 07/01/2015 110 112 Tustin, California Import Bridge Act 1915 Special Assessment, (LOC- KBC Bank Insured), Series 1996 3.600% due 09/02/2013 (d) 100 100 ----------- 8,260 ----------- New Jersey 4.4% New Jersey Economic Development Authority Revenue Bonds, Series 1998 6.375% due 04/01/2031 555 562 ----------- Puerto Rico 22.5% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 5.750% due 07/01/2020 500 518 Puerto Rico Commonwealth Aqueduct & Sewer Authority Revenue Bonds, (FSA Surety Bond Insured), Series 1985-A 9.000% due 07/01/2009 2,000 2,332 ----------- 2,850 ----------- Virgin Islands 3.4% Virgin Islands Public Finance Authority Revenue Bonds, Series 1998-C 5.500% due 10/01/2008 405 432 ----------- Total Municipal Bonds & Notes 12,104 (Cost $11,670) ----------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.9% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities 3.625% due 07/15/2002 (b)(c) 109 111 ----------- Total U.S. Treasury Obligations 111 (Cost $109) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 0.8% -------------------------------------------------------------------------------- Money Market Fund 0.8% Reich & Tang California Money Market 2.630% due 04/02/2001 105 105 ----------- Total Short-Term Instruments 105 (Cost $105) ----------- Total Investments (a) 97.3% $ 12,320 (Cost $11,884) Other Assets and Liabilities (Net) 2.7% 337 ----------- Net Assets 100.0% $ 12,657 ----------- 40 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes -------------------------------------------------------------------------------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $11,883 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 439 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (2) ----------- Unrealized appreciation-net $ 437 ----------- (b) Securities with an aggregate market value of $109 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts (Depreciation) -------------------------------------------------------------------------------- Municipal Bond CBT (06/2001) 9 $ (8) (c) Principal amount of the security is adjusted for inflation. (d) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 41 PIMCO Schedule of Investments Class D Convertible Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES (c)(d) 56.9% -------------------------------------------------------------------------------- Banking & Finance 2.8% Hellenic Finance 2.000% due 07/15/2003 EC 500 $ 440 JMH Finance Ltd. 4.750% due 09/06/2007 $ 1,200 1,226 Swiss Life Finance Ltd. 2.000% due 05/20/2003 E 600 505 0.750% due 05/20/2005 S 750 429 ----------- 2,600 ----------- Energy 1.2% Diamond Offshore Drilling 3.750% due 02/15/2007 $ 1,060 1,077 ----------- Health Care 6.3% Millennium Pharmaceuticals 5.500% due 01/15/2007 1,500 1,513 Roche Holdings, Inc. 0.010% due 01/19/2015 3,650 2,665 Wellpoint Health Network, Inc. 0.000% due 07/02/2019 2,000 1,613 ----------- 5,791 ----------- Industrial 23.0% Allergan, Inc. 0.000% due 11/01/2020 2,600 1,619 Burr-Brown Corp. 4.250% due 02/15/2007 1,000 1,110 Celestica, Inc. 0.000% due 08/01/2020 3,500 1,247 Comverse Technology, Inc. 1.500% due 12/01/2005 2,000 1,713 Corning, Inc. 0.000% due 11/08/2015 1,700 1,003 Dupont Photomasks, Inc. 0.000% due 07/24/2004 1,300 1,181 Exodus Communications, Inc. 5.250% due 02/15/2008 2,000 1,320 4.750% due 07/15/2008 2,000 1,073 Omnicom Group, Inc. 2.250% due 01/06/2013 550 960 Sanmina Corp. 4.250% due 05/01/2004 1,200 1,353 Solectron Corp. 0.000% due 01/27/2019 2,625 1,280 0.000% due 05/08/2020 2,500 1,259 Tyco International Ltd. 0.000% due 11/17/2020 3,300 2,446 Universal Health Services 0.426% due 06/23/2020 2,000 1,183 Young & Rubicam, Inc. 3.000% due 01/15/2005 2,500 2,344 ----------- 21,091 ----------- Technology 11.0% Analog Devices, Inc. 4.750% due 10/01/2005 1,700 1,509 ASM Lithography Holding 2.500% due 04/09/2005 NL 1,500 783 Bisys Group, Inc. 4.000% due 03/15/2006 $ 1,250 1,313 Juniper Networks, Inc. 4.750% due 03/15/2007 2,000 1,465 Lattice Semiconductor Co. 4.750% due 11/01/2006 600 662 STMicroelectronics NV 0.010% due 09/22/2009 900 960 U.S. Cellular Corp. 0.010% due 06/15/2015 3,350 1,968 VERITAS Software Corp. 1.856% due 08/13/2006 1,000 1,441 ----------- 10,101 ----------- Utilities 12.6% AES Corp. 4.500% due 08/15/2005 $ 750 $ 1,407 Alliant Energy Resources, Inc. 7.250% due 02/15/2030 33 1,541 AT&T - Liberty Media Group 4.000% due 11/15/2029 2,200 1,436 3.500% due 01/15/2031 1,500 1,127 Cienna Corp. 3.750% due 02/01/2008 2,000 1,563 Comcast Corp. 0.000% due 12/19/2020 1,000 820 Kerr-McGee Corp. 5.250% due 02/15/2010 1,000 1,235 Nabors Industries, Inc. 0.000% due 02/05/2021 2,000 1,156 Nextel Communications, Inc. 5.250% due 01/15/2010 2,000 1,293 ----------- 11,578 ----------- Total Convertible Bonds & Notes 52,238 (Cost $61,854) ----------- -------------------------------------------------------------------------------- CONVERTIBLE PREFERRED STOCK 34.6% -------------------------------------------------------------------------------- Shares Banking & Finance 4.7% Metlife Capital Trust I Cvt. Pfd. 8.000% due 05/15/2003 41,000 3,875 Union Pacific Capital Trust Cvt. Pfd. 6.250% due 04/21/2028 9,200 453 ----------- 4,328 ----------- Energy 12.8% Apache Corp. Cvt. Pfd. 6.500% due 05/15/2002 37,000 1,796 Kerr-McGee Corp. Cvt. Pfd. 5.500% due 08/01/2004 58,900 3,156 Mirant Trust I Cvt. Pfd. 6.250% due 10/01/2030 50,000 3,725 Valero Energy Cvt. Pfd. 7.750% due 08/18/2003 100,500 3,035 ----------- 11,712 ----------- Industrial 10.6% Cox Communications, Inc. Cvt. Pfd. 7.000% due 08/16/2002 46,000 2,736 Express Scripts Exchange Trust Cvt. Pfd. 7.000% due 11/15/2003 26,000 2,053 Qwest Trends Trust Cvt. Pfd. 5.750% due 11/17/2003 25,000 1,534 Tribune Co. Cvt. Pfd. 2.000% due 05/15/2029 35,100 3,405 ----------- 9,728 ----------- Utilities 6.5% AES Trust VII Cvt. Pfd. 6.000% due 05/15/2008 24,400 1,565 Duke Energy Corp. Cvt. Pfd. 8.250% due 05/18/2004 100,000 2,724 Enron Corp. Cvt. Pfd. 7.000% due 07/31/2002 28,000 1,026 MediaOne Group, Inc. Cvt. Pfd. 6.250% due 08/15/2001 9,500 625 5,940 ----------- Total Convertible Preferred Stock 31,708 (Cost $28,836) ----------- 42 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Value Shares (000s) -------------------------------------------------------------------------------- COMMON STOCKS 2.7% -------------------------------------------------------------------------------- Communications 0.0% Leap Wireless International,Inc. (b) 344 $ 10 ----------- Health Care 0.6% Elan Corp. PLC (b) 10,114 528 ----------- Technology 2.1% AOL Time Warner, Inc. (b) 2,100 84 EMC Corp. (b) 60,668 1,784 McData Corp. `A' (b) 2,233 42 ----------- 1,910 ----------- Total Common Stocks 2,448 (Cost $3,994) ----------- Total Investments (a) 94.2% $ 86,394 (Cost $94,684) Other Assets and Liabilities (Net) (5.8%) (5,296) ----------- Net Assets 100.0% $ 91,690 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $94,699 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 6,705 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (15,010) ----------- Unrealized appreciation-net $ (8,305) ----------- (b) Non-income producing security. (c) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy EC 2,111 04/2001 $ (7) Sell 2,111 04/2001 112 Sell 2,111 06/2001 7 Buy JY 148,448 04/2001 (30) Sell 93,323 04/2001 42 Sell 93,323 06/2001 18 Sell SF 772 05/2001 4 -------------- $ 146 -------------- (d) Principal amount denoted in indicated currency: EC - Euro JY - Japanese Yen NL - Netherlands Guilder SF - Swiss Franc See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 43 PIMCO Schedule of Investments Class D Emerging Markets Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- BERMUDA 0.1% -------------------------------------------------------------------------------- IMEXA Export Trust 10.125% due 05/31/2003 $ 102 $ 91 ----------- Total Bermuda 91 (Cost $92) ----------- -------------------------------------------------------------------------------- BRAZIL 29.1% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (b) $ 1,795 1,627 7.687% due 04/15/2009 (b) 250 210 14.500% due 10/15/2009 2,500 2,702 8.000% due 04/15/2014 4,631 3,586 6.000% due 04/15/2024 750 516 7.625% due 04/15/2024 (b) 1,100 833 8.875% due 04/15/2024 3,350 2,278 10.125% due 05/15/2027 500 382 12.250% due 03/06/2030 2,600 2,295 11.000% due 08/17/2040 2,950 2,340 ----------- Total Brazil 16,769 (Cost $17,232) ----------- -------------------------------------------------------------------------------- BULGARIA 1.0% -------------------------------------------------------------------------------- Republic of Bulgaria 6.312% due 07/28/2011 (b) $ 250 188 6.312% due 07/28/2024 (b) 500 373 ----------- Total Bulgaria 561 (Cost $604) ----------- -------------------------------------------------------------------------------- CROATIA 4.2% -------------------------------------------------------------------------------- Republic of Croatia 6.250% due 07/31/2006 (b) $ 1,456 1,423 6.250% due 07/31/2010 (b) 993 971 ----------- Total Croatia 2,394 (Cost $2,384) ----------- -------------------------------------------------------------------------------- MALAYSIA 2.6% -------------------------------------------------------------------------------- Republic of Malaysia 6.875% due 05/15/2001 $ 1,500 1,522 ----------- Total Malaysia 1,522 (Cost $1,499) ----------- -------------------------------------------------------------------------------- MEXICO 20.1% -------------------------------------------------------------------------------- United Mexican States 0.000% due 06/30/2003 $ 9,459 118 10.375% due 02/17/2009 250 275 9.875% due 02/01/2010 1,000 1,076 11.375% due 09/15/2016 250 289 8.125% due 12/30/2019 3,250 2,919 6.250% due 12/31/2019 4,075 3,683 7.412% due 12/31/2019 (b) 1,025 1,003 7.515% due 12/31/2019 400 391 7.532% due 12/31/2019 1,150 1,125 11.500% due 05/15/2026 575 696 ----------- Total Mexico 11,575 (Cost $11,291) ----------- -------------------------------------------------------------------------------- MOROCCO 1.0% -------------------------------------------------------------------------------- Morroco Restructured Tranche A 7.652% due 01/01/2009 $ 658 584 ----------- Total Morocco 584 (Cost $593) ----------- -------------------------------------------------------------------------------- NIGERIA 0.8% -------------------------------------------------------------------------------- Central Bank of Nigeria 6.250% due 11/15/2020 $ 750 469 Central Bank of Nigeria - Warrant 0.000% due 11/15/2020 1 0 ----------- Total Nigeria 469 (Cost $430) ----------- -------------------------------------------------------------------------------- PANAMA 4.7% -------------------------------------------------------------------------------- Republic of Panama 7.875% due 02/13/2002 $ 50 $ 50 7.733% due 05/14/2002 69 70 9.625% due 02/08/2011 600 596 4.500% due 07/17/2014 1,375 1,148 8.875% due 09/30/2027 500 439 9.375% due 04/01/2029 400 403 ----------- Total Panama 2,706 (Cost $2,637) ----------- -------------------------------------------------------------------------------- PERU 2.6% -------------------------------------------------------------------------------- Republic of Peru 4.000% due 03/07/2017 $ 2,100 1,313 4.500% due 03/07/2017 250 170 ----------- Total Peru 1,483 (Cost $1,473) ----------- -------------------------------------------------------------------------------- PHILIPPINES 0.7% -------------------------------------------------------------------------------- Republic of Philippines 6.500% due 12/01/2017 $ 500 405 ----------- Total Philippines 405 (Cost $392) ----------- -------------------------------------------------------------------------------- POLAND 4.1% -------------------------------------------------------------------------------- Republic of Poland 6.000% due 10/27/2014 $ 1,315 1,281 3.750% due 10/27/2024 1,450 1,058 ----------- Total Poland 2,339 (Cost $2,226) ----------- -------------------------------------------------------------------------------- QATAR 2.1% -------------------------------------------------------------------------------- State of Qatar 9.750% due 06/15/2030 $ 1,125 1,198 ----------- Total Qatar 1,198 (Cost $1,084) ----------- -------------------------------------------------------------------------------- RUSSIA 13.4% -------------------------------------------------------------------------------- Russian Federation 9.250% due 11/27/2001 $ 1,250 1,257 11.750% due 06/10/2003 2,900 2,834 8.750% due 07/24/2005 700 575 8.250% due 03/31/2010 353 238 11.000% due 07/24/2018 650 486 12.750% due 06/24/2028 1,850 1,622 5.000% due 03/31/2030 647 262 5.000% due 03/31/2030 1,004 411 ----------- Total Russia 7,685 (Cost $7,213) ----------- -------------------------------------------------------------------------------- SOUTH AFRICA 0.9% -------------------------------------------------------------------------------- Republic of South Africa 9.125% due 05/19/2009 $ 500 522 ----------- Total South Africa 522 (Cost $514) ----------- -------------------------------------------------------------------------------- SOUTH KOREA 3.0% -------------------------------------------------------------------------------- Korea Development Bank 7.125% due 09/17/2001 $ 500 503 Republic of Korea 8.875% due 04/15/2008 1,100 1,221 ----------- Total South Korea 1,724 (Cost $1,641) ----------- 44 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- VENEZUELA 5.9% -------------------------------------------------------------------------------- Republic of Venezuela 7.375% due 12/18/2007 (b) $ 1,500 $ 1,255 6.750% due 03/31/2020 1,475 1,136 9.250% due 09/15/2027 1,430 993 Republic of Venezuela - Warrant 0.000% due 04/15/2020 6 0 ----------- Total Venezuela 3,384 (Cost $3,371) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 5.1% -------------------------------------------------------------------------------- Commercial Paper 5.1% Abbey National North America 5.090% due 04/19/2001 100 100 4.870% due 05/02/2001 1,000 996 American Express Credit Corp. 5.100% due 04/06/2001 200 200 General Electric Capital Corp. 4.970% due 04/04/2001 200 200 UBS Finance, Inc. 5.340% due 05/16/2001 300 298 5.040% due 08/02/2001 600 590 5.070% due 08/08/2001 300 294 Verizon Global Funding 4.950% due 06/15/2001 300 297 ----------- Total Short-Term Instruments 2,975 (Cost $2,975) ----------- Total Investments (a) 101.4% $ 58,386 (Cost $57,651) Other Assets and Liabilities (Net) (1.4%) (788) ----------- Net Assets 100.0% $ 57,598 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $58,137 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 1,278 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (1,029) ----------- Unrealized appreciation-net $ 249 ----------- (b) Variable rate security. The rate listed is as of March 31, 2001. (c) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy HF 909,150 05/2001 $ (75) Sell 550,000 05/2001 127 Buy 158,130 08/2001 (26) Buy 48,055 09/2001 (8) Buy PZ 750 05/2001 27 -------------- $ 45 -------------- (d) Principal amount denoted in indicated currency: HF - Hungarian Forint PZ - Polish Zloty See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 45 Foreign Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- AUSTRALIA (e)(f) 2.2% -------------------------------------------------------------------------------- General Electric Capital Australia Funding 6.750% due 09/15/2007 A$ 750 $ 390 General Motors Acceptance Corp. 4.849% due 03/25/2002 (d) EC 10,300 9,038 Registered Australian Mortgage Securities 5.138% due 09/26/2032 (d) 2,840 2,498 Torrens Trust 5.424% due 07/15/2031 (d) $ 2,776 2,776 ----------- Total Australia 14,702 (Cost $15,826) ----------- -------------------------------------------------------------------------------- AUSTRIA (e)(f) 0.2% -------------------------------------------------------------------------------- Republic of Austria 5.500% due 01/15/2010 (i) EC 1,200 1,093 ----------- Total Austria 1,093 (Cost $1,041) ----------- -------------------------------------------------------------------------------- BELGIUM (e)(f) 2.4% -------------------------------------------------------------------------------- Kingdom of Belgium 9.000% due 03/28/2003 EC 5 5 5.100% due 11/21/2004 (d) BF 183,200 4,290 7.500% due 07/29/2008 (i) EC 10,500 10,669 5.000% due 09/28/2011 (i) 1,700 1,485 ----------- Total Belgium 16,449 (Cost $18,926) ----------- -------------------------------------------------------------------------------- BRAZIL (e)(f) 0.9% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (d) $ 7,040 6,380 ----------- Total Brazil 6,380 (Cost $6,570) ----------- -------------------------------------------------------------------------------- CANADA (e)(f) 9.2% -------------------------------------------------------------------------------- Beneficial Canada, Inc. 6.350% due 04/01/2002 C$ 3,440 2,211 Commonwealth of Canada 5.250% due 09/01/2003 640 410 6.000% due 09/01/2005 (i) 52,500 34,482 7.250% due 06/01/2007 (i) 34,500 24,151 5.500% due 06/01/2010 1,800 1,149 ----------- Total Canada 62,403 (Cost $63,801) ----------- -------------------------------------------------------------------------------- CAYMAN ISLANDS (e)(f) 1.2% -------------------------------------------------------------------------------- Capital Credit Card Corp. Ltd. 5.625% due 10/15/2004 DM 2,800 1,262 International Credit Receivable Japan 0.746% due 08/25/2005 JY 50,000 398 5.602% due 03/15/2010 1,800 1,585 MBNA American Euro 4.887% due 05/19/2004 (d) EC 8,100 7,116 ----------- Total Cayman Islands 10,361 (Cost $12,305) ----------- -------------------------------------------------------------------------------- DENMARK (e)(f) 1.7% -------------------------------------------------------------------------------- Lb Rheinland - PFALZ 4.750% due 04/04/2008 EC 5,330 4,633 Nykredit 6.000% due 10/01/2009 DK 29,895 3,415 Unikredit Realkredit 6.000% due 07/01/2029 27,036 3,098 ----------- Total Denmark 11,146 (Cost $10,934) ----------- -------------------------------------------------------------------------------- FRANCE (e)(f) 10.2% -------------------------------------------------------------------------------- Axa 2.500% due 01/01/2014 EC 835 $ 729 Republic of France 5.500% due 04/25/2007 (i) 7,890 7,320 4.000% due 04/25/2009 (i) 8,250 6,924 3.000% due 07/25/2009 3,115 2,656 4.000% due 10/25/2009 (i) 46,070 38,104 5.500% due 04/25/2010 13,960 12,913 ----------- Total France 68,646 (Cost $70,890) ----------- -------------------------------------------------------------------------------- GERMANY (e)(f) 18.4% -------------------------------------------------------------------------------- Commerzbank AG 5.206% due 10/25/2032 (d) EC 6,200 5,470 Depfa Pfandbriefbank 4.750% due 07/15/2008 3,590 3,106 5.750% due 03/04/2009 (i) 3,560 3,270 DT Hypothekenbank 3.500% due 07/03/2006 7,000 5,798 Hypothekenbank in Essen AG 5.500% due 02/20/2007 1,690 1,620 Landesbank Baden-Wuerttemberg AG 5.500% due 04/02/2007 3,240 2,943 Republic of Germany 6.000% due 07/04/2007 (i) 26,200 24,913 5.250% due 01/04/2008 (i) 35,730 32,802 4.125% due 07/04/2008 (i) 21,500 18,375 4.500% due 07/04/2009 (i) 19,100 16,618 5.375% due 01/04/2010 (i) 1,750 1,615 6.250% due 01/04/2024 (i) 1,880 1,841 6.250% due 01/04/2030 (i) 1,700 1,688 Rheinische Hypothekenbank AG 4.250% due 09/24/2008 3,310 2,763 WestDeutsche Landersbank 4.750% due 09/28/2007 1,630 1,421 ----------- Total Germany 124,243 (Cost $123,367) ----------- -------------------------------------------------------------------------------- GREECE (e)(f) 0.4% -------------------------------------------------------------------------------- Hellenic Finance 2.000% due 07/15/2003 EC 1,600 1,409 Hellenic Republic 7.850% due 05/19/2003 (d) GD 293 266 7.890% due 06/17/2003 (d) 315 287 7.080% due 10/23/2003 (d) 1,103 1,018 ----------- Total Greece 2,980 (Cost $3,926) ----------- -------------------------------------------------------------------------------- ITALY (e)(f) 14.5% -------------------------------------------------------------------------------- Finmeccanica SpA 2.000% due 06/08/2005 EC 544 461 First Italian Auto Transaction 5.139% due 07/01/2008 (d) 7,230 6,363 Island Finance 5.404% due 03/30/2015 (d) 2,684 2,372 Republic of Italy 5.750% due 09/15/2002 (i) 26,400 23,681 7.750% due 11/01/2006 (i) 5,700 5,738 4.500% due 05/01/2009 (i) 64,110 54,593 4.250% due 11/01/2009 (i) 5,560 4,639 ----------- Total Italy 97,847 (Cost $100,861) ----------- 46 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- JAPAN (e)(f) 1.7% -------------------------------------------------------------------------------- Government of Japan 0.900% due 12/22/2008 (d)(i) JY 907,400 $ 7,180 International Credit Receivable Japan 1 Tranche A 0.863% due 08/25/2005 132,610 1,056 SHL Corp. Ltd. 1.031% due 12/25/2024 (d) 76,618 610 1.331% due 12/25/2024 (d) 76,000 605 ----------- Total Japan 9,451 (Cost $10,447) ----------- -------------------------------------------------------------------------------- MEXICO (e)(f) 0.9% -------------------------------------------------------------------------------- Petroleos Mexicanos 8.850% due 09/15/2007 $ 1,040 1,070 9.375% due 12/02/2008 1,290 1,345 United Mexican States 8.750% due 05/30/2002 BP 960 1,385 10.375% due 01/29/2003 DM 2,575 1,233 4.000% due 03/11/2004 JY 130,000 1,062 ----------- Total Mexico 6,095 (Cost $6,454) ----------- -------------------------------------------------------------------------------- NETHERLANDS (e)(f) 0.6% -------------------------------------------------------------------------------- Unilever NV 4.830% due 09/17/2001 (d) EC 4,800 4,204 ----------- Total Netherlands 4,204 (Cost $4,096) ----------- -------------------------------------------------------------------------------- NEW ZEALAND (e)(f) 0.9% -------------------------------------------------------------------------------- Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 13,430 5,951 ----------- Total New Zealand 5,951 (Cost $7,504) ----------- -------------------------------------------------------------------------------- PERU (e)(f) 0.3% -------------------------------------------------------------------------------- Republic of Peru 4.500% due 03/07/2017 (d) $ 2,700 1,843 ----------- Total Peru 1,843 (Cost $1,867) ----------- -------------------------------------------------------------------------------- SOUTH KOREA (e)(f) 2.7% -------------------------------------------------------------------------------- Export-Import Bank Korea 7.250% due 06/25/2001 $ 1,945 1,950 6.500% due 02/10/2002 (d) 800 801 KBC Bank Fund Trust IV 8.220% due 11/29/2049 EC 2,800 2,591 Korea Development Bank 4.885% due 05/14/2001 DM 7,310 3,286 2.770% due 05/21/2001 JY 500,000 3,995 2.450% due 09/10/2001 231,000 1,848 1.875% due 02/13/2002 466,000 3,726 ----------- Total South Korea 18,197 (Cost $19,514) ----------- -------------------------------------------------------------------------------- SPAIN (e)(f) 3.8% -------------------------------------------------------------------------------- Kingdom of Spain 5.150% due 07/30/2009 (i) EC 28,430 25,459 ----------- Total Spain 25,459 (Cost $28,157) ----------- -------------------------------------------------------------------------------- SUPRANATIONAL (e)(f) 1.3% -------------------------------------------------------------------------------- Eurofima 4.750% due 07/07/2004 (i) SK 60,900 5,885 International Bank for Reconstruction & Development 7.250% due 04/09/2001 N$ 6,400 2,581 ----------- Total Supranational 8,466 (Cost $10,093) ----------- -------------------------------------------------------------------------------- SWEDEN (e)(f) 0.7% -------------------------------------------------------------------------------- Kingdom of Sweden 13.000% due 06/15/2001 SK 11,200 $ 1,097 5.000% due 01/28/2009 37,800 3,746 ----------- Total Sweden 4,843 (Cost $5,233) ----------- -------------------------------------------------------------------------------- UNITED KINGDOM (e)(f) 7.5% -------------------------------------------------------------------------------- Abbey National Treasury Service PLC 5.250% due 01/21/2004 BP 2,670 3,766 British Telecommunications PLC 6.079% due 12/15/2003 (d) $ 5,180 5,182 Core 5.138% due 03/17/2009 (d) 3,360 3,339 Halifax Group Euro Finance 7.627% due 12/29/2049 EC 1,040 965 Haus Ltd. 5.124% due 12/10/2037 (d) 8,500 7,481 Holmes Financing PLC 5.859% due 07/15/2017 (d) 5,540 5,541 Lloyds TSB Capital 7.375% due 02/07/2049 BP 500 462 SCCR Series 1 Ltd. 5.373% due 12/15/2031 (d) 1,414 1,247 United Kingdom Gilt 7.500% due 12/07/2006 (i) 4,800 7,678 7.250% due 12/07/2007 (i) 4,800 7,712 5.750% due 12/07/2009 (i) 4,690 7,078 ----------- Total United Kingdom 50,451 (Cost $52,225) ----------- -------------------------------------------------------------------------------- UNITED STATES (e)(f) 62.4% -------------------------------------------------------------------------------- Asset-Backed Securities 10.4% Advanta Mortgage Loan Trust 5.383% due 07/25/2026 (d) $ 227 227 AFC Home Equity Loan Trust 5.270% due 03/25/2027 (d) 681 681 5.350% due 07/25/2030 (d) 7,283 7,296 Americredit Automobile Receivable Trust 5.880% due 12/05/2003 161 162 Amresco Residential Securities Mortgage Loan Trust 6.000% due 06/25/2029 (d) 4,603 4,621 Banc One Auto Grantor Trust 6.270% due 11/20/2003 162 163 6.290% due 07/20/2004 321 323 Bayview Financial Acquisition Trust 7.170% due 02/25/2029 (d) 308 309 5.920% due 11/25/2030 (d) 5,100 5,100 Chase Manhattan Grantor Trust 6.610% due 09/15/2002 54 54 Conseco Finance 5.534% due 10/15/2031 (d) 1,176 1,181 CS First Boston Mortgage Securities Corp. 5.424% due 12/15/2030 (d) 5,859 5,865 Delta Funding Home Equity Loan Trust 7.380% due 12/15/2017 398 402 EQCC Home Equity Loan Trust 5.770% due 05/20/2010 757 756 5.484% due 03/20/2030 330 330 First Alliance Mortgage Loan Trust 5.238% due 12/20/2027 (d) 190 190 Green Tree Floorplan Receivables Master Trust 5.921% due 11/15/2004 (d) 2,500 2,501 Nissan Auto Receivables Grantor Trust 5.450% due 04/15/2004 1,108 1,112 Provident Bank Equipment Lease Trust 5.830% due 11/25/2011 (d) 1,732 1,732 Providian Gateway Master Trust 5.380% due 03/15/2007 5,800 5,800 Providian Home Equity Loan Trust 5.340% due 06/25/2025 (d) 3,342 3,346 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 47 PIMCO Schedule of Investments Class D (Cont.) Foreign Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- PSB Lending Home Loan Owner Trust 6.830% due 05/20/2018 $ 339 $ 342 Residential Asset Securities Corp. 5.770% due 01/25/2032 (d) 10,416 10,429 Residential Funding Mortgage Securities, Inc. 10.836% due 06/01/2001 11,100 11,100 Salomon Brothers Mortgage Securities VII 5.310% due 02/25/2031 (d) 5,734 5,734 USAA Auto Loan Grantor Trust 5.800% due 01/15/2005 478 482 ----------- 70,238 ----------- Corporate Bonds & Notes 12.6% Abbey National Capital Trust I 8.963% due 12/29/2049 2,000 2,218 Allegheny Energy Supply 6.325% due 05/01/2002 (d) 2,900 2,902 Alpha Wind 11.321% due 05/23/2001 (d) 2,000 2,000 Associates First Capital Corp. 5.810% due 01/25/2031 (d) 5,391 5,391 AT&T Capital Corp. 5.881% due 04/23/2002 (d) 675 677 Bancomext Trust Division 8.000% due 08/05/2003 390 397 Bear Stearns Co., Inc. 5.210% due 03/28/2003 (d) 2,670 2,669 Beckman Instruments, Inc. 7.100% due 03/04/2003 344 347 Capital One Bank 6.308% due 07/28/2003 (d) 12,000 11,797 CMS Energy Corp. 8.125% due 05/15/2002 546 553 DaimlerChrysler North America Holding Corp. 5.640% due 08/23/2002 (d) 3,900 3,868 DQE Capital Corp. 6.179% due 01/15/2002 (d) 800 800 Finova Capital Corp. 5.193% due 06/18/2003 (d)(j) 5,700 4,674 Ford Motor Credit Co. 1.000% due 12/22/2003 JY 107,000 854 6.089% due 07/19/2004 (d) $ 2,800 2,781 1.200% due 02/07/2005 JY 619,000 4,925 General Motors Acceptance Corp. 1.250% due 12/20/2004 208,000 1,665 Gold Eagle Capital Ltd. 11.079% due 04/15/2001 (d) $ 2,500 2,500 International Game Technology 7.875% due 05/15/2004 1,700 1,726 J.P. Morgan & Co., Inc. 6.655% due 02/15/2012 (d) 4,670 4,264 Jones Intercable, Inc. 8.875% due 04/01/2007 427 458 MGM Grand, Inc. 6.950% due 02/01/2005 180 180 NeHi, Inc. 11.379% due 06/09/2003 (d) 2,000 2,020 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(j) 2,700 2,228 Protective Life Funding Trust 6.089% due 01/17/2003 (d) 1,200 1,202 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (h) 13,375 13,449 5.629% due 02/11/2003 (d) 400 401 Sprint Capital Corp. 5.875% due 05/01/2004 690 678 Texas Utilities Corp. 7.389% due 09/24/2001 (d) 2,600 2,592 Texas Utilities Electric Co. 5.650% due 12/20/2002 (d) 1,500 1,501 WorldCom, Inc. 7.375% due 01/15/2003 (d) 3,100 3,136 ----------- 84,853 ----------- Mortgage-Backed Securities 22.5% Bank of America Mortgage Securities, Inc. 6.500% due 05/25/2029 291 286 Bear Stearns Adjustable Rate Mortgage Trust 6.944% due 02/25/2031 (d) 4,569 4,614 Chase Mortgage Finance Corp. 6.550% due 08/25/2028 1,906 1,924 Citicorp Mortgage Securities, Inc. 6.500% due 07/25/2028 1,766 1,775 6.500% due 03/25/2029 140 136 Crusade Global Trust 5.719% due 05/15/2021 (d) 13,119 13,152 Fannie Mae 8.495% due 07/01/2021 (d) 612 630 7.764% due 11/01/2022 (d) 800 827 7.583% due 01/01/2023 (d) 1,130 1,166 8.210% due 08/01/2023 (d) 921 947 Freddie Mac 6.000% due 03/15/2008 620 621 9.050% due 06/15/2019 51 54 8.266% due 06/01/2022 (d) 1,051 1,059 8.393% due 08/01/2022 (d) 607 622 General Electric Capital Mortgage Services, Inc. 6.250% due 07/25/2029 500 506 Government National Mortgage Association 7.625% due 11/20/2021 (d) 477 489 7.375% due 05/20/2022 (d) 45 46 7.750% due 07/20/2022 (d) 499 511 7.750% due 09/20/2022 (d) 314 322 7.375% due 05/20/2023 (d) 493 502 7.750% due 07/20/2023 (d) 533 545 7.750% due 07/20/2023 (d) 252 258 7.750% due 08/20/2023 (d) 238 244 7.750% due 09/20/2023 (d) 1,392 1,426 7.750% due 09/20/2023 (d) 621 636 7.125% due 10/20/2023 (d) 2,594 2,660 7.625% due 10/20/2024 (d) 212 217 7.375% due 04/20/2025 (d) 154 157 7.750% due 07/20/2025 (d) 3,312 3,391 7.750% due 09/20/2025 (d) 644 660 7.625% due 12/20/2025 (d) 250 257 7.750% due 09/20/2026 (d) 514 526 7.375% due 04/20/2027 (d) 1,271 1,290 6.000% due 04/15/2028-05/20/2030 (d)(g) 118,980 59,219 7.000% due 04/20/2030-05/20/2030 (d)(g) 10,384 5,840 6.500% due 04/23/2031 (d) 4,260 4,259 7.500% due 04/23/2031 12,600 12,915 Homeside Mortgage Securities Trust 5.929% due 01/20/2027 (d) 2,900 2,900 Medallion Trust 5.880% due 07/12/2031 (d) 4,844 4,846 Prudential Home Mortgage Securities 6.800% due 05/25/2024 480 464 Residential Funding Mortgage Securities, Inc. 6.500% due 05/25/2029 1,311 1,195 5.779% due 05/12/2032 (d) 12,805 12,821 Sasco Floating Rate Commercial Mortgage Trust 5.408% due 11/20/2001 (d) 1,900 1,901 Structured Asset Mortgage Investments, Inc. 6.581% due 06/25/2029 (d) 2,938 2,984 ----------- 151,800 ----------- Municipal Bonds & Notes 0.1% Massachusetts State Turnpike Authority Metro Highway System Revenue Bonds, (MBIA Insured), Series 1999 5.000% due 01/01/2037 1,000 941 ----------- Shares Preferred Security 1.0% DG Funding Trust 7.150% due 12/29/2049 (d) 640 6,528 ----------- 48 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- U.S. Government Agencies 2.7% Federal Home Loan Bank 5.805% due 02/15/2002 (d) $ 14,000 $ 14,066 Small Business Administration 6.640% due 02/10/2011 4,400 4,428 ----------- 18,494 ----------- U.S. Treasury Obligations 13.1% Treasury Inflation Protected Securities (h) 3.625% due 07/15/2002 (b)(i) 79,211 80,771 3.875% due 01/15/2009 2,348 2,442 3.625% due 04/15/2028 4,762 4,855 3.875% due 04/15/2029 213 228 ----------- 88,296 ----------- Total United States 421,150 (Cost $419,115) ----------- -------------------------------------------------------------------------------- PURCHASED CALL OPTION 0.0% -------------------------------------------------------------------------------- U.S. Treasury Bond (OTC) 5.500% due 02/15/2008 Strike @ 113.250 Exp. 06/01/2001 25,000 0 U.S. Treasury Note (OTC) 5.500% due 02/15/2008 Strike @ 112.19 Exp. 07/02/2001 215,000 15 U.S. Treasury Note Futures (CBOT) 6.000% due 06/30/2001 Strike @ 119.000 Exp. 05/26/2001 400 6 ----------- Total Purchased Call Options 21 (Cost $46) ----------- -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Republic of Germany (OTC) 4.500% due 07/04/2009 Strike @ 90.281 Exp. 05/02/2001 17,000 0 Republic of Germany (OTC) 5.250% due 01/04/2008 Strike @ 96.281 Exp. 05/02/2001 29,000 0 Republic of Germany (OTC) 5.250% due 01/04/2008 Strike @ 98.400 Exp. 05/02/2001 21,000 0 Republic of Germany (OTC) 5.250% due 01/04/2011 Strike @ 95.300 Exp. 05/02/2001 15,000 0 Republic of Germany (OTC) 6.000% due 07/04/2007 Strike @ 101.031 Exp. 05/02/2001 27,000 0 Republic of France (OTC) 4.000% due 10/25/2009 Strike @ 86.500 Exp. 05/02/2001 42,000 0 Government National Mortgage Association (OTC) 6.000% due 05/21/2031 Strike @ 90.281 Exp. 05/04/2001 145,000 0 Government National Mortgage Association (OTC) 7.500% due 05/21/2031 Strike @ 96.641 Exp. 05/04/2001 13,000 0 Interest Rate Swap (OTC) 7.500% due 05/01/2023 Strike @ 7.500 Exp. 04/29/2002 11,200 16 Japanese Government Bond (OTC) 10.800% due 06/20/2008 Strike @ 97.750 Exp. 05/02/2001 14,700,000 1 ----------- Total Purchased Put Options 17 (Cost $462) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 10.1% -------------------------------------------------------------------------------- Commercial Paper 9.2% Abbey National North America 5.040% due 08/06/2001 $ 7,000 $ 6,881 American Express Co. 5.320% due 04/04/2001 100 100 Becton Dickinson & Co. 4.800% due 07/25/2001 2,000 1,969 Coca-Cola Co. 4.600% due 07/12/2001 7,500 7,396 General Electric Capital Corp. 4.990% due 04/03/2001 1,800 1,800 4.980% due 04/25/2001 2,500 2,492 4.870% due 05/30/2001 10,000 9,918 4.600% due 07/18/2001 10,000 9,853 National Rural Utilities Cooperative Finance Corp. 4.880% due 05/25/2001 1,000 993 Reseau Ferre De France 4.590% due 07/25/2001 7,500 7,383 Swedbank, Inc. 5.150% due 04/25/2001 2,000 1,993 5.090% due 08/08/2001 4,000 3,931 UBS Finance, Inc. 5.340% due 04/04/2001 600 600 5.040% due 08/02/2001-08/15/2001 (g) 12,600 6,683 Verizon Global Funding 5.340% due 04/05/2001 300 300 ----------- 62,292 ----------- Repurchase Agreement 0.8% State Street Bank 4.600% due 04/02/2001 5,365 5,365 (Dated 03/30/2001. Collateralized by Freddie Mac ----------- 7.000% due 03/15/2010 valued at $5,476. Repurchase proceeds are $5,367.) U.S. Treasury Bills 0.1% 4.600% due 05/17/2001 (b) 585 581 ----------- Total Short-Term Instruments 68,238 (Cost $68,255) ----------- Total Investments (a) 154.2% $ 1,040,636 (Cost $1,061,915) Written Options (c) (0.3%) (2,046) (Premiums $696) Other Assets and Liabilities (Net) (53.9%) (363,749) ----------- Net Assets 100.0% $ 674,841 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,062,222 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 8,890 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (30,477) ----------- Unrealized depreciation-net $ (21,586) ----------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 49 PIMCO Schedule of Investments Class D (Cont.) Foreign Bond Fund March 31, 2001 -------------------------------------------------------------------------------- (b) Securities with an aggregate market value of $7,367 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 10 Year Note (06/2001) 2,127 $ (502) EuroBond 10 Year Note (06/2001) 199 183 Government of Japan 10 Year Note (06/2001) 162 174 UK GILT LIF (06/2001) 15 (9) -------------- $ (154) -------------- (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - CME Eurodollar December Futures Strike @ 95.00 Exp. 12/17/2001 34 $ 14 $ 10 Call - CBOT U.S. Treasury Note June Futures Strike @ 107.00 Exp. 05/26/2001 35 22 30 Put - CME Eurodollar December Futures Strike @ 95.25 Exp. 12/17/2001 206 103 113 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 243 133 133 Put - OTC 3 Month LIBOR Interest Rate Swap Strike @ 7.50 Exp. 04/29/2002 16,000,000 362 1,689 Put - CBOT U.S. Treasury Note June Futures Strike @ 105.00 Exp. 05/26/2001 125 62 71 ------------------------- $ 696 $ 2,046 ------------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy A$ 1,600 04/2001 $ (106) Sell 2,584 04/2001 79 Buy C$ 5,813 04/2001 (32) Sell 11,560 04/2001 145 Sell SF 43,161 05/2001 208 Buy CP 349,600 04/2001 (26) Sell 349,600 04/2001 18 Sell DK 54,194 05/2001 344 Buy EC 161,227 04/2001 (1,425) Sell 146,971 04/2001 7,780 Sell 135,290 06/2001 510 Sell BP 10,726 05/2001 522 Sell H$ 121,000 05/2001 40 Buy 111,900 08/2001 (49) Sell 223,800 08/2001 172 Buy HF 341,600 08/2001 (29) Buy JY 5,209,915 04/2001 (1,027) Sell 5,209,915 04/2001 2,255 Sell 5,960,790 06/2001 1,136 Buy KW 1,262,100 04/2001 (159) Sell 1,262,100 04/2001 38 Sell N$ 21,385 04/2001 370 Buy PZ 28,050 04/2001 1,181 Sell 28,050 04/2001 (245) Sell SK 57,435 05/2001 361 Buy TB 28,140 04/2001 (23) Sell 28,140 04/2001 28 Buy TD 21,403 04/2001 (7) Sell 21,403 04/2001 (2) -------------- $ 12,057 -------------- (f) Principal amount denoted in indicated currency: A$ - Australian Dollar BF - Belgian Franc BP - British Pound C$ - Canadian Dollar CP - Chilean Peso DK - Danish Krone DM - Germany Mark EC - Euro GD - Greek Drachma H$ - Hong Kong Dollar HF - Hungarian Forint JY - Japanese Yen KW - Korean Won N$ - New Zealand Dollar PZ - Polish Zloty SF - Swiss Franc SK - Swedish Krona TB - Thai Baht TD - Taiwan Dollar (g) Securities are grouped together by coupon or range of coupons and represent a range of maturities. (h) Principal amount of the security is adjusted for inflation. (i) Subject to financing transaction. (j) Security is in default. (k) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive fixed rate equal to 6.949% and pay floating rate based on 6-month BP-LIBOR. Broker: Merrill Lynch Exp. 08/06/2003 BP 4,500 $ 240 Receive floating rate based on 6-month Australian Bank Bill and pay interest rate swap equal to 5.217% Broker: Morgan Stanley Exp. 03/15/2006 A$ 36,800 171 Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.248%. Broker: Royal Bank of Canada Exp. 08/02/2005 C$ 60,600 (1,492) Receive floating rate based on 3-Month H$-HIBOR and pay fixed rate equal to 6.910%.need to review the docs. Broker: Goldman Sachs Exp. 02/15/2006 H$ 293,000 (1,988) Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.515%. Broker: J.P. Morgan Exp. 05/10/2002 C$ 24,330 (302) 50 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Receive floating rate based on 6-month JY-LIBOR and pay fixed rate equal to 2.020%. Broker: Goldman Sachs Exp. 05/18/2010 JY 1,776,000 $ (961) Receive fixed rate equal to 6.790% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 02/15/2006 $ 37,200 2,190 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2006 83,700 1,985 Receive fixed rate equal to 5.683% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Exp. 01/08/2004 BP 33,800 509 Receive floating rate based on 3-Month H$-HIBOR and pay fixed rate equal to 5.906%. Broker: Goldman Sachs Exp. 07/11/2006 H$ 419,000 (270) Receive fixed rate equal to 5.710% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 07/11/2006 $ 53,700 528 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2011 46,400 589 Receive fixed rate equal to 5.900% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 01/26/2004 BP 26,400 439 Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.410%. Broker: Morgan Stanley Exp. 09/01/2002 11,000 (41) Receive fixed rate equal to 5.513% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Exp. 03/01/2004 11,000 99 Receive fixed rate equal to 6.343% and pay floating rate based on 6-month EURO-LIBOR. Broker: Lehman Brothers Exp. 03/08/2016 EC 47,500 (25) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.465%. Broker: Lehman Brothers Exp. 03/07/2016 BP 30,200 $ 49 Receive fixed rate equal to 6.273% and pay floating rate based on 6-month EURO-LIBOR. Broker: Morgan Stanley Exp. 03/13/2016 EC 32,960 (68) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.778%. Broker: Morgan Stanley Exp. 03/13/2016 BP 20,600 (50) Receive fixed rate equal to 5.471% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/15/2006 24,700 206 Receive fixed rate equal to 5.440% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 03/19/2006 $ 9,500 13 Receive floating rate based on 3-month H$-HIBOR and pay fixed rate equal to 5.550%. Broker: Goldman Sachs Exp. 03/16/2006 H$ 73,800 51 Receive fixed rate equal to 5.467% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 03/15/2006 $ 18,400 1 Receive fixed rate equal to 5.225% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachss Exp. 03/19/2003 BP 53,370 27 Receive fixed rate equal to 5.133% and pay floating rate based on 3-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/19/2003 145,900 (136) ----------- $ 1,764 ----------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 51 PIMCO Schedule of Investments Class D High Yield Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 73.6% -------------------------------------------------------------------------------- Banking & Finance 4.5% Americo Life, Inc. 9.250% due 06/01/2005 $ 198 $ 193 Amethyst Financial Co. Ltd. 11.750% due 10/29/2001 3,944 3,944 Arvin Capital 9.500% due 02/01/2027 14,986 10,866 Bay View Capital Corp. 9.125% due 08/15/2007 2,900 2,277 Beaver Valley Funding Corp. 8.625% due 06/01/2007 14,197 14,946 9.000% due 06/01/2017 9,432 10,239 Choctaw Resort Development Enterprise 9.250% due 04/01/2009 1,400 1,430 Forest City Enterprises, Inc. 8.500% due 03/15/2008 10,719 10,357 General Motors Acceptance Corp. 5.722% due 04/29/2002 (d) 631 632 Golden State Holdings 6.750% due 08/01/2001 (d) 8,180 8,162 7.000% due 08/01/2003 3,073 3,048 7.125% due 08/01/2005 687 673 Host Marriott LP 8.375% due 02/15/2006 9,197 9,151 Lamar Media Corp. 9.625% due 12/01/2006 100 105 Presidential Life Insurance Corp. 7.875% due 02/15/2009 7,451 7,233 Reliance Group Holdings, Inc. 0.000% due 11/15/2049 (c)(e) 3,769 330 Sumitomo Bank Treasury Co. 9.400% due 12/29/2049 (d) 10,459 10,087 Telewest Credit Links 10.875% due 02/07/2005 14,000 11,839 Trizec Finance Ltd. 10.875% due 10/15/2005 13,772 14,047 ----------- 119,559 ----------- Industrials 59.7% 360 Networks, Inc. 13.000% due 05/01/2008 5,740 2,210 Abbey Healthcare Group 9.500% due 11/01/2002 11,346 11,431 Adelphia Business Solutions, Inc. 12.250% due 09/01/2004 5,679 5,310 Adelphia Communications Corp. 10.875% due 10/01/2010 15 16 Allied Waste North America, Inc. 7.375% due 01/01/2004 13,910 13,701 7.625% due 01/01/2006 7,438 7,252 8.875% due 04/01/2008 8,000 7,928 American Airlines, Inc. 10.610% due 03/04/2010 513 580 American Cellular Corp. 9.500% due 10/15/2009 6,000 5,820 American Media Operation, Inc. 10.250% due 05/01/2009 789 809 American Standard Cos., Inc. 7.125% due 02/15/2003 158 160 9.250% due 12/01/2016 1,177 1,183 Amerigas Partners LP 10.000% due 04/15/2006 4,900 4,895 10.125% due 04/15/2007 2,367 2,450 AM-FM, Inc. 8.750% due 06/15/2007 4,457 4,691 8.000% due 11/01/2008 4,144 4,320 Amphenol Corp. 9.875% due 05/15/2007 5,445 5,731 Archibald Candy Corp. 10.250% due 07/01/2004 3,155 1,672 Arco Chemical Co. 9.375% due 12/15/2005 4,425 4,561 Ball Corp. 7.750% due 08/01/2006 6,704 6,830 8.250% due 08/01/2008 5,206 5,323 Beckman Instruments, Inc. 7.100% due 03/04/2003 6,423 6,471 7.450% due 03/04/2008 12,717 12,559 Benedek Communications Corp. 0.000% due 05/15/2006 (c) 1,184 787 Bergen Brunswig Corp. 7.375% due 01/15/2003 6,950 6,912 7.250% due 06/01/2005 500 486 Beverly Enterprises, Inc. 9.000% due 02/15/2006 13,070 13,266 British Sky Broadcasting PLC 7.300% due 10/15/2006 6,733 6,616 6.875% due 02/23/2009 10,000 9,268 8.200% due 07/15/2009 21,299 21,296 Browning-Ferris Industries, Inc. 6.100% due 01/15/2003 3,234 3,150 7.875% due 03/15/2005 1,578 1,575 Building Materials Corp. 7.750% due 07/15/2005 971 553 8.000% due 10/15/2007 1,007 539 8.000% due 12/01/2008 10,601 5,672 Cadmus Communications Corp. 9.750% due 06/01/2009 2,250 2,109 Call-Net Enterprises, Inc. 8.000% due 08/15/2008 6,765 2,089 Canadian Forest Oil Ltd. 8.750% due 09/15/2007 11,372 11,656 Century Aluminum Co. 11.750% due 04/15/2008 6,050 6,171 Century Communications Corp. 9.750% due 02/15/2002 513 517 0.010% due 03/15/2003 15,743 12,752 9.500% due 03/01/2005 10,500 10,487 8.750% due 10/01/2007 2,998 2,893 CF Cable TV, Inc. 9.125% due 07/15/2007 9,149 9,319 Charter Communications Holdings LLC 8.250% due 04/01/2007 10,845 10,425 8.625% due 04/01/2009 3,944 3,816 10.000% due 04/01/2009 8,172 8,519 11.750% due 01/15/2010 35 24 9.920% due 04/01/2011 8,000 5,620 Clark R & M, Inc. 8.375% due 11/15/2007 2,392 1,854 Clearnet Communications, Inc. 0.000% due 05/01/2009 (c) 4,733 3,999 Cliffs Drilling Co. 10.250% due 05/15/2003 592 612 Columbus McKinnon 8.500% due 04/01/2008 8,306 7,019 Consolidated Container 10.125% due 07/15/2009 6,428 6,332 Constellation Brands, Inc. 8.000% due 02/15/2008 6,000 6,165 8.500% due 03/01/2009 4,000 4,040 Container Corp. of America 9.750% due 04/01/2003 789 807 11.250% due 05/01/2004 5,185 5,211 Continental Cablevision 9.500% due 08/01/2013 7,900 8,757 Cross Timbers Oil Co. 9.250% due 04/01/2007 1,136 1,198 8.750% due 11/01/2009 1,900 1,986 Crown Castle International Corp. 0.000% due 11/15/2007 1,775 1,473 10.750% due 08/01/2011 12,755 13,233 CSC Holdings, Inc. 9.250% due 11/01/2005 789 825 9.875% due 05/15/2006 671 704 7.875% due 12/15/2007 79 80 7.625% due 04/01/2011 9,150 8,978 9.875% due 02/15/2013 2,595 2,790 9.875% due 04/01/2023 3,155 3,407 52 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Cumberland Farms 10.500% due 10/01/2003 $ 4,528 $ 4,415 Delta Air Lines, Inc. 10.790% due 03/26/2014 1,786 1,988 Diamond Cable Communication Co. 13.250% due 09/30/2004 1,184 1,160 11.750% due 12/15/2005 (d) 7,887 7,335 0.000% due 02/15/2007 (c) 2,700 1,944 Echostar Communications Corp. 9.250% due 02/01/2006 19,177 19,248 9.375% due 02/01/2009 6,704 6,754 Electric Lightwave, Inc. 6.050% due 05/15/2004 1,000 914 Energis PLC 9.750% due 06/15/2009 3,550 3,355 Fairpoint Communications, Inc. 9.500% due 05/01/2008 6,412 5,354 10.908% due 05/01/2008 (d) 3,550 3,345 Federal-Mogul Corp. 7.500% due 07/01/2004 5,719 886 7.375% due 01/15/2006 119 17 7.750% due 07/01/2006 7,473 1,084 Ferrellgas Partners LP 9.375% due 06/15/2006 11,931 11,573 Fisher Scientific International 7.125% due 12/15/2005 10,845 10,357 9.000% due 02/01/2008 12,249 12,280 Flag Ltd. 8.250% due 01/30/2008 22,141 20,147 Forest Oil Corp. 10.500% due 01/15/2006 2,828 2,984 Fox/Liberty Networks LLC 0.000% due 08/15/2007 (c) 7,690 7,036 Garden State Newspapers 8.750% due 10/01/2009 3,120 3,042 8.625% due 07/01/2011 3,076 2,999 Global Crossing Holding Ltd. 9.500% due 11/15/2009 3,944 3,717 6.000% due 10/15/2013 9,969 9,450 Golden Northwest Aluminum 12.000% due 12/15/2006 1,933 1,653 Gulf Canada Resources Ltd. 9.625% due 07/01/2005 2,233 2,311 8.375% due 11/15/2005 3,155 3,423 Harrahs Operating Co., Inc. 7.875% due 12/15/2005 10,206 10,257 7.500% due 01/15/2009 16,307 16,275 HCA - The Healthcare Co. 6.870% due 09/15/2003 1,026 1,035 6.910% due 06/15/2005 986 971 8.850% due 01/01/2007 5,350 5,791 7.000% due 07/01/2007 14,993 14,562 8.700% due 02/10/2010 450 476 8.360% due 04/15/2024 4,733 4,586 6.730% due 07/15/2045 3,944 3,985 Hercules, Inc. 11.125% due 11/15/2007 7,454 7,566 HMH Properties, Inc. 7.875% due 08/01/2005 28,334 27,554 Hollinger International Publishing 8.625% due 03/15/2005 198 201 9.250% due 02/01/2006 3,629 3,738 9.250% due 03/15/2007 537 556 Horseshoe Gaming Holding 8.625% due 05/15/2009 15,250 15,212 HS Resources, Inc. 9.875% due 12/01/2003 2,879 2,937 9.250% due 11/15/2006 12,365 12,860 Huntsman Corp. 9.500% due 07/01/2007 9,718 7,532 Huntsman ICI Chemicals LLC 10.125% due 07/01/2009 1,796 1,859 Huntsman Polymers Corp. 11.750% due 12/01/2004 3,629 3,030 Intermedia Communications, Inc. 0.000% due 05/15/2006 (c) 20,240 20,442 International Game Technology 7.875% due 05/15/2004 11,594 11,768 8.375% due 05/15/2009 11,121 11,455 ISP Holdings, Inc. 9.000% due 10/15/2003 16,374 14,245 John Q. Hammons Hotels 8.875% due 02/15/2004 2,312 2,231 9.750% due 10/01/2005 2,633 2,541 Jones Intercable, Inc. 8.875% due 04/01/2007 3,991 4,284 Jupiters Ltd. 8.500% due 03/01/2006 10,096 10,071 K Mart Corp. 12.350% due 01/01/2008 3,803 4,111 8.800% due 07/01/2010 902 818 9.350% due 01/02/2020 10,203 7,974 9.780% due 01/05/2020 7,552 6,432 Keebler Corp. 10.750% due 07/01/2006 4,733 5,020 KPNQWest BV 8.125% due 06/01/2009 19,560 17,115 L-3 Communications Corp. 10.375% due 05/01/2007 5,938 6,116 8.500% due 05/15/2008 466 472 Lear Corp. 8.250% due 02/01/2002 5,056 5,081 7.960% due 05/15/2005 4,315 4,352 Lenfest Communications 8.375% due 11/01/2005 8,400 9,156 10.500% due 06/15/2006 415 489 Level 3 Communications, Inc. 11.000% due 03/15/2008 4,338 3,416 9.125% due 05/01/2008 27,655 19,773 0.000% due 12/01/2008 (c) 9,425 4,571 11.250% due 03/15/2010 789 619 12.875% due 03/15/2010 18,000 6,930 Levi Strauss & Co. 6.800% due 11/01/2003 15,853 14,902 Leviathan Gas Corp. 10.375% due 06/01/2009 2,773 2,981 Lin Television Corp. 8.375% due 03/01/2008 10,035 9,082 Lyondell Chemical Co. 9.625% due 05/01/2007 12,174 12,539 Mail-Well Corp. 8.750% due 12/15/2008 8,026 6,862 Mandalay Resort Group 6.750% due 07/15/2003 16,077 15,554 9.250% due 12/01/2005 4,812 4,854 6.450% due 02/01/2006 79 74 10.250% due 08/01/2007 198 204 9.500% due 08/01/2008 395 413 Manor Care, Inc. 8.000% due 03/01/2008 3,000 3,068 Marsh Supermarkets, Inc. 8.875% due 08/01/2007 5,916 5,724 McLeodUSA, Inc. 0.000% due 03/01/2007 (c) 34,329 28,321 8.375% due 03/15/2008 4,023 3,430 9.500% due 11/01/2008 14,997 13,535 8.125% due 02/15/2009 3,815 3,205 11.500% due 05/01/2009 789 773 Mediacom LLC 9.500% due 01/15/2013 22,600 22,205 Metromedia Fiber Network, Inc. 10.000% due 11/15/2008 18,301 15,281 10.000% due 12/15/2009 11,910 9,945 MGM Grand, Inc. 6.950% due 02/01/2005 23,993 23,977 8.500% due 09/15/2010 15,000 15,680 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 53 PIMCO Schedule of Investments Class D (Cont.) High Yield Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Mirage Resorts, Inc. 6.625% due 02/01/2005 $ 2,761 $ 2,733 7.250% due 10/15/2006 2,106 2,111 Newpark Resources, Inc. 8.625% due 12/15/2007 3,470 3,435 Nextel Communications, Inc. 0.000% due 09/15/2007 (c) 9,000 6,683 9.375% due 11/15/2009 20,333 17,334 Nextel Partners, Inc. 0.000% due 02/01/2009 (c) 14,701 9,151 11.000% due 03/15/2010 2,658 2,319 Nextlink Communications, Inc. 9.625% due 10/01/2007 7,099 4,224 10.750% due 06/01/2009 8,426 5,013 10.500% due 12/01/2009 8,037 4,943 NL Industries, Inc. 11.750% due 10/15/2003 1,135 1,158 NTL, Inc. 12.750% due 04/15/2005 553 528 11.500% due 02/01/2006 2,600 2,327 11.500% due 10/01/2008 5,026 4,448 Octel Developments PLC 10.000% due 05/01/2006 1,499 1,506 Omnicare, Inc. 5.000% due 12/01/2007 6,000 5,258 8.125% due 03/15/2011 6,000 6,150 Orion Network Systems, Inc. 0.000% due 01/15/2007 (c) 9,885 2,669 11.250% due 01/15/2007 11,535 4,268 P&L Coal Holdings 8.875% due 05/15/2008 15,025 15,739 Park Place Entertainment Corp. 8.875% due 09/15/2008 4,733 4,839 Petroleos Mexicanos 9.375% due 12/02/2008 6,310 6,578 PharMerica, Inc. 8.375% due 04/01/2008 14,607 13,950 Physician Sales and Service, Inc. 8.500% due 10/01/2007 3,696 3,049 Piedmont Aviation, Inc. 10.200% due 01/15/2005 1,163 1,187 10.250% due 03/28/2005 451 446 9.900% due 11/08/2006 865 841 Pioneer National Resources Co. 8.875% due 04/15/2005 15,853 16,755 8.250% due 08/15/2007 6,827 7,000 6.500% due 01/15/2008 5,482 5,086 Price Communications Wireless, Inc. 9.125% due 12/15/2006 7,947 8,205 Pride International, Inc. 9.375% due 05/01/2007 4,595 4,865 Primedia, Inc. 10.250% due 06/01/2004 3,155 3,234 8.500% due 02/01/2006 8,671 8,801 7.625% due 04/01/2008 6,507 6,279 Qwest Communications International, Inc. 7.500% due 11/01/2008 5,916 6,138 R & B Falcon Corp. 6.500% due 04/15/2003 6,144 6,196 9.125% due 12/15/2003 1,250 1,306 6.750% due 04/15/2005 3,569 3,645 9.125% due 12/15/2008 722 784 R.H. Donnelley, Inc. 9.125% due 06/01/2008 5,455 5,591 Racers 8.375% due 10/01/2007 17,242 14,021 Renaissance Media Group 0.000% due 04/15/2008 (c) 16,960 12,974 Rogers Cablesystems Ltd. 10.000% due 03/15/2005 3,155 3,392 Rogers Cantel, Inc. 8.300% due 10/01/2007 3,524 3,498 8.800% due 10/01/2007 1,065 1,068 9.375% due 06/01/2008 27,024 28,173 Rural Cellular Corp. 9.625% due 05/15/2008 11,502 10,582 Safety-Kleen Corp. 9.250% due 06/01/2008 (e) 22,459 281 9.250% due 05/15/2009 (e) 11,042 138 SC International Services, Inc. 9.250% due 09/01/2007 11,970 12,389 Scotia Pacific Co. LLC 7.710% due 01/20/2014 (d) 142 104 Silgan Holdings, Inc. 9.000% due 06/01/2009 11,556 11,556 Smith's Food & Drug Centers, Inc. 8.640% due 07/02/2012 222 239 Station Casinos, Inc. 10.125% due 03/15/2006 782 812 9.750% due 04/15/2007 5,403 5,565 8.875% due 12/01/2008 631 639 9.875% due 07/01/2010 789 793 Stone Container Corp. 8.812% due 10/01/2005 1,117 1,121 11.500% due 08/15/2006 3,826 3,998 Telecorp PCS, Inc. 10.625% due 07/15/2010 10,888 10,561 Telewest Communications PLC 9.625% due 10/01/2006 3,873 3,757 11.000% due 10/01/2007 (d) 5,136 5,059 11.250% due 11/01/2008 789 797 0.000% due 04/15/2009 (c) 6,746 3,997 9.875% due 02/01/2010 6,113 5,777 Tenet Healthcare Corp. 7.875% due 01/15/2003 789 806 8.625% due 12/01/2003 5,684 5,905 8.000% due 01/15/2005 5,731 5,910 8.625% due 01/15/2007 5,761 6,006 7.625% due 06/01/2008 18,945 19,158 8.125% due 12/01/2008 10,500 10,841 Time Warner Telecom, Inc. 10.125% due 02/01/2011 5,650 5,678 Triad Hospitals, Inc. 11.000% due 05/15/2009 1,653 1,827 Tritel PCS, Inc. 10.375% due 01/15/2011 13,250 12,753 U.S. Airways, Inc. 9.625% due 09/01/2003 17,648 17,805 9.330% due 01/01/2006 3,280 3,198 United Defense Industries, Inc. 8.750% due 11/15/2007 789 783 United Pan-Europe Communications NV 0.000% due 02/01/2009 (c) 6,502 2,406 10.875% due 08/01/2009 5,885 3,972 1.000% due 11/01/2009 7,000 2,485 13.750% due 02/01/2010 6,500 2,178 Vintage Petroleum, Inc. 9.000% due 12/15/2005 7,761 8,033 9.750% due 06/30/2009 2,009 2,200 VoiceStream Wireless Corp. 10.375% due 11/15/2009 3,155 3,471 Waste Management, Inc. 7.000% due 05/15/2005 513 520 WCG Corp. 8.250% due 03/15/2004 11,900 11,850 Western Gas Resources, Inc. 10.000% due 06/15/2009 5,700 6,071 Williams Communications Group, Inc. 10.700% due 10/01/2007 7,493 5,845 11.700% due 08/01/2008 2,000 1,570 10.875% due 10/01/2009 7,492 5,507 11.875% due 08/01/2010 6,000 4,650 World Color Press, Inc. 8.375% due 11/15/2008 513 526 7.750% due 02/15/2009 1,381 1,373 54 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Worldwide Fiber, Inc. 12.000% due 08/01/2009 $ 5,969 $ 2,238 XO Communications, Inc. 12.250% due 06/01/2009 3,800 1,349 12.125% due 12/01/2009 5,000 1,575 Young Broadcasting, Inc. 9.000% due 01/15/2006 14,690 13,919 8.750% due 06/15/2007 127 117 10.000% due 03/01/2011 13,400 13,065 ----------- 1,577,388 ----------- Utilities 9.4% AES Corp. 8.750% due 12/15/2002 3,000 3,060 10.250% due 07/15/2006 2,299 2,397 8.500% due 11/01/2007 6,152 6,106 9.500% due 06/01/2009 16,944 17,961 9.375% due 09/15/2010 15 16 American Tower Corp. 9.375% due 02/01/2009 13,000 12,513 AT&T Canada, Inc. 0.000% due 06/15/2008 (c) 28,344 23,592 10.625% due 11/01/2008 7,572 8,403 AT&T Wireless Services, Inc. 7.875% due 03/01/2011 16,750 16,732 Azurix Corp. 10.375% due 02/15/2007 9,644 9,933 Calpine Corp. 9.250% due 02/01/2004 10,254 10,259 7.625% due 04/15/2006 3,550 3,568 8.750% due 07/15/2007 19,241 19,774 7.875% due 04/01/2008 5,748 5,756 7.750% due 04/15/2009 789 780 8.500% due 02/15/2011 6,700 6,893 Carolina Power & Light Energy, Inc. 6.117% due 07/29/2002 (d) 2,288 2,293 Chesapeake Energy Corp. 9.625% due 05/01/2005 3,000 3,285 CMS Energy Corp. 8.125% due 05/15/2002 3,579 3,625 6.750% due 01/15/2004 592 578 7.000% due 01/15/2005 7,887 7,565 9.875% due 10/15/2007 6,113 6,548 8.500% due 04/15/2011 9,000 8,756 France Telecom 7.750% due 03/01/2011 19,750 19,902 Giant Industries, Inc. 9.750% due 11/15/2003 150 149 9.000% due 09/01/2007 1,750 1,654 Key Energy Services, Inc. 8.375% due 03/01/2008 2,770 2,853 Mastec, Inc. 7.750% due 02/01/2008 7,250 6,978 Progress Energy, Inc. 6.550% due 03/01/2004 9,070 9,266 7.100% due 03/01/2011 9,070 9,348 Rocky River Realty 8.810% due 04/14/2007 (b) 2,912 3,085 Williams Cos., Inc. 7.259% due 11/15/2001 (d) 4,812 4,819 Wilmington Trust Co. - Tucson Electric 10.210% due 01/01/2009 500 531 10.732% due 01/01/2013 7,015 7,840 ----------- 246,818 ----------- Total Corporate Bonds & Notes 1,943,765 (Cost $2,093,227) ----------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 1.7% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 1.7% LTC Commercial Corp. 9.200% due 08/04/2023 2,235 2,421 7.970% due 04/15/2028 3,993 3,750 NationsBanc Mortgage Capital Corp. 8.035% due 05/25/2028 3,035 2,664 Red Mountain Funding Corp. 9.150% due 11/28/2027 4,517 3,075 Resolution Trust Corp. 6.900% due 02/25/2027 3,693 3,591 7.000% due 05/25/2027 4,417 4,412 Sasco Floating Rate Commercial Mortgage Trust 5.600% due 04/25/2003 (d) 23,504 23,379 ----------- 43,292 ----------- Stripped Mortgage-Backed Securities 0.0% Fannie Mae (IO) 7.000% due 07/25/2008 1,366 163 6.500% due 06/25/2017 32 0 7.000% due 04/25/2019 5,965 243 7.000% due 12/25/2021 2,107 230 ----------- 636 ----------- Total Mortgage-Backed Securities 43,928 (Cost $43,762) ----------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 10.1% -------------------------------------------------------------------------------- Acterna LLC 9.688% due 09/01/2007 1,476 1,466 Adelphia Communications Corp. 9.190% due 10/01/2002 3,000 3,000 9.300% due 02/15/2004 7,000 6,999 Airplanes Pass Through Trust 10.875% due 03/15/2019 22,490 14,828 Airtrust 0.990% due 06/01/2013 8,912 3,347 Allied Waste Industries, Inc. 7.687% due 07/30/2006 1,824 1,807 7.812% due 07/30/2006 8,056 7,982 8.062% due 07/21/2007 912 904 8.125% due 07/30/2007 (d) 2,280 2,259 9.625% due 07/30/2007 (d) 3,191 3,163 9.687% due 07/30/2007 (d) 4,559 4,518 9.812% due 07/30/2007 (d) 2 2 Allied Waste North America, Inc. 7.937% due 07/30/2007 912 911 Bergen Brunswig Corp. 7.650% due 03/31/2005 3,397 3,386 7.912% due 03/31/2005 394 393 8.133% due 03/31/2005 849 847 8.207% due 03/31/2005 1,699 1,693 9.120% due 03/31/2005 4,246 4,233 9.200% due 03/31/2005 4,246 4,233 9.331% due 03/31/2005 4,246 4,233 7.650% due 03/31/2006 2,548 2,561 Charter Commercial Holdings LLC 8.150% due 03/31/2008 15,500 15,382 Conseco Finance 9.300% due 10/15/2030 8,000 8,464 Continental Airlines, Inc. 6.792% due 07/30/2004 10,000 9,788 Crown Castle 8.130% due 03/31/2008 3,000 3,013 Da Vita 8.000% due 03/31/2003 4,176 4,169 8.750% due 03/13/2006 492 491 9.187% due 03/31/2006 2,463 2,458 Emmis Communications Corp. 8.312% due 08/31/2009 16,500 16,500 Flag Ltd. 7.312% due 03/31/2006 2,323 2,318 Global Crossing Holding Ltd. 8.030% due 08/15/2006 3,000 3,004 Green Tree Financial Corp. 8.000% due 07/15/2018 6,000 5,297 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 55 PIMCO Schedule of Investments Class D (Cont.) High Yield Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Huntsman Corp. 9.571% due 07/31/2004 $ 787 $ 754 7.750% due 06/30/2005 492 447 8.913% due 06/30/2005 688 626 9.375% due 06/30/2005 1,869 1,700 9.500% due 06/30/2005 138 125 9.571% due 06/30/2005 1,351 1,229 8.750% due 12/31/2005 3,000 2,876 Impress Metal 9.457% due 12/01/2006 1,015 1,016 Insight Midwest 8.187% due 12/15/2009 7,000 7,043 Island Inland Co. 9.508% due 07/09/2003 4,000 3,100 Morgan Stanley Aircraft Finance 8.700% due 03/15/2023 17,782 11,878 Nextel Communications, Inc. 8.400% due 03/31/2008 17,169 16,722 Primedia, Inc. 7.955% due 07/31/2004 4,975 4,968 Rural Cellular Corp. 9.068% due 10/03/2009 3,819 3,752 Starwood Hotels & Resorts 7.757% due 02/23/2003 7,758 7,786 8.131% due 02/23/2003 6,743 6,767 Stone Container Corp. 8.812% due 04/01/2003 (d) 1,466 1,471 8.875% due 10/01/2003 1,466 1,471 8.812% due 10/01/2003 (d) 4,136 4,148 8.875% due 10/01/2003 4,129 4,142 8.812% due 10/01/2005 1,117 1,119 Total Renal Care 8.062% due 03/31/2003 878 872 8.437% due 03/31/2003 4,095 4,088 9.875% due 03/31/2003 7,324 7,274 Triad Hospitals, Inc. 9.240% due 12/31/2005 1,324 1,330 9.390% due 12/31/2005 5,523 5,547 VoiceStream 8.500% due 02/15/2009 4,500 4,466 8.190% due 06/30/2009 16,000 15,887 ----------- Total Asset-Backed Securities 266,253 (Cost $281,973) ----------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 0.2% -------------------------------------------------------------------------------- United Mexican States 8.500% due 02/01/2006 5,719 5,848 ----------- Total Sovereign Issues 5,848 (Cost $5,703) ----------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 1.9% -------------------------------------------------------------------------------- Health Care 0.7% Tenet Healthcare Corp. 6.000% due 12/01/2005 3,664 3,316 Total Renal Care Holdings 7.000% due 05/15/2009 15,953 13,959 ----------- 17,275 ----------- Industrial 1.0% Pride International, Inc. 0.010% due 04/24/2018 9,268 4,147 Waste Management, Inc. 4.000% due 02/01/2002 24,338 23,607 ----------- 27,754 ----------- Utilities 0.2% Nextel Communications, Inc. 5.250% due 01/15/2010 2,000 1,293 Rogers Communications, Inc. 2.000% due 11/26/2005 4,400 3,286 ----------- 4,579 ----------- Total Convertible Bonds & Notes 49,608 (Cost $48,033) ----------- Value Shares (000s) -------------------------------------------------------------------------------- PREFERRED STOCK 3.1% -------------------------------------------------------------------------------- CSC Holdings, Inc. 11.125% due 04/01/2008 161,572 $ 17,611 Fresenius Medical Care 9.000% due 12/01/2006 28,250 28,674 7.875% due 02/01/2008 26,750 26,015 Newscorp Overseas Ltd. 8.625% due 12/31/2049 105,100 2,512 Primedia, Inc. 9.200% due 11/01/2009 55,300 4,797 8.625% due 04/01/2010 39,500 3,308 ----------- Total Preferred Stock 82,917 (Cost $85,373) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 6.0% -------------------------------------------------------------------------------- Principal Amount (000s) Commercial Paper 5.7% Abbey National North America 5.425% due 04/19/2001 $ 400 399 American Express Credit Corp. 6.240% due 04/06/2001 500 500 CBA (de) Finance 4.960% due 04/23/2001 2,300 2,293 Coca-Cola Co. 5.140% due 04/12/2001 2,000 1,997 4.600% due 07/12/2001 4,000 3,944 Fannie Mae 4.685% due 09/06/2001 4,600 4,505 General Electric Capital Corp. 5.120% due 04/04/2001 1,700 1,700 4.600% due 07/18/2001 3,000 2,956 Gillette Co. 5.430% due 04/17/2001 1,500 1,497 4.910% due 08/21/2001 6,000 5,887 KFW International Finance, Inc. 5.320% due 05/30/2001 4,000 3,966 Monsanto Co. 4.980% due 08/15/2001 15,200 14,925 National Rural Utilities Cooperative Finance Corp. 5.300% due 05/24/2001 3,200 3,176 Reseau Ferre De France 4.590% due 07/25/2001 1,000 984 Swedbank, Inc. 5.290% due 05/30/2001 1,800 1,785 5.020% due 08/08/2001 3,400 3,341 UBS Finance, Inc. 5.400% due 04/02/2001 19,000 19,000 5.060% due 04/04/2001 4,500 4,499 5.390% due 05/30/2001 4,000 3,965 5.290% due 06/06/2001 4,900 4,855 5.920% due 06/06/2001 12,700 12,584 5.190% due 06/13/2001 8,600 8,514 5.290% due 06/13/2001 18,000 17,819 5.010% due 08/01/2001 20,500 20,164 5.040% due 08/02/2001 2,000 1,967 5.010% due 08/08/2001 3,500 3,440 ----------- 150,662 ----------- Repurchase Agreement 0.3% State Street Bank 4.600% due 04/02/2001 8,039 8,039 (Dated 03/30/2001. Collateralized by Freddie Mac 7.000% due 03/15/2010 valued at $8,205 Repurchase proceeds are $8,042.) ----------- Total Short-Term Instruments 158,700 (Cost $158,649) ----------- Total Investments (a) 96.6% $ 2,551,020 (Cost $2,716,720) Other Assets and Liabilities (Net) 3.4% 91,122 ----------- Net Assets 100.0% $ 2,642,142 ----------- 56 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $2,721,008 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 31,646 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (201,634) ----------- Unrealized depreciation-net $ (169,988) ----------- (b) Restricted security. (c) Security becomes interest bearing at a future date. (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Security is in default. (f) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy C$ 2,539 05/2001 $ (10) Sell 2,539 05/2001 4 Buy EC 2,870 04/2001 (9) Sell 2,870 04/2001 152 Sell 2,870 06/2001 9 ------------- $ 146 ------------- (g) Principal amount denoted in indicated currency: C$ - Canadian Dollar EC - Euro (h) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount Appreciation -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 2.500% and the Fund will pay to the counterparty at par in the event of default of CMS Energy Corp. Bond with maximum maturity date of 12/01/2009. Broker: Morgan Stanley Exp. 06/26/2001 $ 13,750 $ 38 ----------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 57 PIMCO Schedule of Investments Class D Low Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 46.8% -------------------------------------------------------------------------------- Banking & Finance 23.6% American General Finance 6.875% due 12/14/2001 $ 25,000 $ 25,373 Associates Corp. of North America 6.700% due 05/29/2001 400 401 5.400% due 08/27/2001 (d) 1,000 1,003 6.875% due 06/20/2002 20,000 20,420 6.950% due 08/01/2002 1,000 1,026 AT&T Capital Corp. 5.881% due 04/23/2002 (d) 10,000 10,024 Banco Nacional de Comercio Exterior 7.250% due 02/02/2004 1,800 1,814 Bank of America Corp. 7.200% due 09/15/2002 100 103 7.875% due 12/01/2002 100 104 6.625% due 06/15/2004 1,000 1,032 Bank One Corp. 7.250% due 08/01/2002 500 514 Bear Stearns Co., Inc. 4.370% due 06/28/2001 (d) 2,000 2,003 5.370% due 12/16/2002 (d) 2,800 2,805 6.125% due 02/01/2003 3,000 3,026 5.210% due 03/28/2003 (d) 8,600 8,597 6.200% due 03/30/2003 9,700 9,795 7.156% due 06/01/2004 (d) 3,000 2,965 Beaver Valley Funding Corp. 8.250% due 06/01/2003 3,311 3,401 Beneficial Corp. 5.409% due 01/09/2002 (d) 10,000 10,017 6.650% due 09/12/2002 5,000 5,090 6.575% due 12/16/2002 5,440 5,541 Capital One Bank 7.000% due 04/30/2001 300 300 5.820% due 06/23/2003 (d) 1,100 1,076 Case Credit Corp. 5.713% due 08/01/2001 (d) 4,750 4,604 Chrysler Financial Corp. LLC 5.120% due 08/08/2002 (d) 8,000 7,930 CIT Group, Inc. 5.190% due 09/13/2002 (d) 19,900 19,842 7.375% due 03/15/2003 1,000 1,033 Credit Asset Receivable 6.274% due 10/31/2003 30,349 30,461 Export-Import Bank Korea 6.500% due 02/10/2002 7,500 7,505 6.500% due 11/15/2006 6,700 6,827 7.100% due 03/15/2007 6,700 6,965 Finova Capital Corp. 6.316% due 04/08/2003 (d)(i) 1,000 820 5.193% due 06/18/2003 (d)(i) 6,000 4,920 Ford Motor Credit Co. 6.093% due 03/19/2002 (d) 18,857 18,818 5.939% due 07/16/2002 (d) 100 100 6.520% due 08/12/2002 13,000 13,223 6.000% due 01/14/2003 15,000 15,117 5.133% due 03/17/2003 (d) 3,000 2,978 6.125% due 04/28/2003 14,000 14,150 5.860% due 04/26/2004 (d) 19,000 18,841 7.500% due 03/15/2005 1,000 1,047 6.179% due 07/18/2005 (d) 400 394 General Motors Acceptance Corp. 7.125% due 05/01/2001 15,000 15,023 5.509% due 11/12/2002 (d) 17,400 17,417 5.609% due 11/12/2002 (d) 63,520 63,349 5.875% due 01/22/2003 500 503 6.750% due 03/15/2003 3,700 3,788 6.394% due 07/20/2003 (d) 7,822 7,814 5.550% due 09/15/2003 3,000 2,996 5.750% due 11/10/2003 5,000 5,011 6.396% due 01/20/2004 (d) 9,400 9,399 5.750% due 03/22/2004 (d) 5,000 5,000 6.536% due 04/05/2004 (d) 700 690 7.625% due 06/15/2004 1,000 1,051 6.850% due 06/17/2004 1,000 1,028 Gold Eagle Capital Ltd. 8.629% due 04/15/2001(d) 20,000 20,006 Great Western Financial 8.600% due 02/01/2002 4,000 4,104 Heller Financial, Inc. 5.979% due 10/22/2001(d) 1,000 1,001 5.858% due 04/28/2003(d) 20,000 19,944 Hitachi Credit America 6.100% due 04/24/2001 25,000 25,013 Household Finance Corp. 6.490% due 04/09/2001 20,000 20,004 6.125% due 07/15/2002 11,000 11,090 7.625% due 01/15/2003 10,849 11,260 6.125% due 02/27/2003 1,500 1,513 5.116% due 06/24/2003(d) 1,500 1,495 Industrial Bank of Korea 8.375% due 09/30/2002 5,000 5,177 Key Bank NA 6.052% due 04/24/2003 12,900 12,988 KFW International Finance, Inc. 5.000% due 01/22/2002 7,690 7,700 5.500% due 02/19/2002 7,887 7,936 5.375% due 05/10/2002 12,282 12,360 6.125% due 07/08/2002 18,589 18,890 Korea Development Bank 7.125% due 09/17/2001 28,963 29,154 7.900% due 02/01/2002 6,100 6,191 7.625% due 10/01/2002 21,200 21,742 6.500% due 11/15/2002 5,898 5,957 8.294% due 06/16/2003(d) 3,500 3,430 6.625% due 11/21/2003 20,300 20,549 Lehman Brothers Holdings, Inc. 6.110% due 05/07/2002(d) 5,000 5,027 6.186% due 07/08/2002(d) 1,500 1,501 5.610% due 12/12/2002(d) 1,500 1,506 5.240% due 04/04/2003(d) 7,900 7,912 Marsh & McLennan Cos., Inc. 6.625% due 06/15/2004 1,000 1,033 Merrill Lynch & Co. 5.945% due 11/26/2001(d) 80,600 80,825 5.779% due 01/15/2002(d) 5,000 5,003 7.129% due 02/08/2002(d) 25,000 25,078 6.130% due 04/07/2003 7,770 7,926 Metropolitan Life Insurance Co. 6.300% due 11/01/2003 17,850 18,140 Middletown Trust 11.750% due 07/15/2010 911 952 Midland Funding I 10.330% due 07/23/2002 1,335 1,388 Morgan Stanley Group, Inc. 5.228% due 03/11/2003(d) 5,000 5,000 Nacional Financiera 10.625% due 11/22/2001 7,500 7,714 7.284% due 05/08/2003(d) 7,000 7,180 Pemex Finance Ltd. 6.125% due 11/15/2003 13,933 13,849 PNC Bank NA 5.150% due 01/24/2002(d) 20,000 20,012 Popular North American, Inc. 6.875% due 06/15/2001 5,000 5,018 7.375% due 09/15/2001 20,000 20,211 Popular, Inc. 6.200% due 04/30/2001 1,000 1,001 Qwest Capital Funding, Inc. 6.125% due 07/15/2002 5,250 5,282 Rothmans Holdings 6.500% due 05/06/2003 14,000 14,146 Salomon, Inc. 7.250% due 05/01/2001 3,700 3,706 7.300% due 05/15/2002 15,000 15,400 7.500% due 02/01/2003 3,000 3,118 Salomon, Smith Barney Holdings 3.650% due 02/14/2002(j) 1,104 1,110 5.568% due 05/14/2002(d) 25,150 25,174 5.891% due 07/23/2002(d) 5,100 5,099 58 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Seismic Ltd. 10.901% due 01/01/2002 (d) $ 10,000 $ 9,940 Shopping Center Associates 6.750% due 01/15/2004 11,725 11,920 Spieker Properties, Inc. 6.800% due 05/01/2004 2,000 2,040 Toyota Motor Credit Corp. 7.325% due 02/15/2002 (d) 11,600 11,620 Transamerica Finance Corp. 6.125% due 11/01/2001 5,000 5,032 Wachovia Corp. 6.075% due 05/02/2005 (d) 8,000 7,990 Wells Fargo & Co. 6.625% due 07/15/2004 1,000 1,037 6.025% due 05/02/2005 (d) 32,700 32,672 ----------- 1,084,140 ----------- Industrials 12.0% Allied Waste North America, Inc. 7.375% due 01/01/2004 5,000 4,925 AMR Corp. 9.125% due 10/24/2001 4,250 4,338 Atlas Air, Inc. 8.010% due 01/02/2010 9,778 9,932 Caterpillar, Inc. 9.750% due 06/01/2019 13,766 14,379 Cemex SA de CV 8.625% due 07/18/2003 10,000 10,300 Coastal Corp. 5.554% due 03/06/2002 (d) 32,200 32,200 Conoco, Inc. 5.900% due 04/15/2004 3,100 3,151 Cox Enterprises, Inc. 6.625% due 06/14/2002 3,000 3,035 6.425% due 05/01/2033 (d) 2,000 2,001 DaimlerChrysler North America Holding Corp. 5.790% due 12/16/2002 (d) 13,400 13,345 5.720% due 08/16/2004 (d) 1,000 975 6.900% due 09/01/2004 1,000 1,016 Delta Air Lines, Inc. 8.500% due 09/15/2001 205 208 6.650% due 03/15/2004 2,925 2,862 Eastman Chemical Co. 6.375% due 01/15/2004 250 244 Electric Lightwave, Inc. 6.050% due 05/15/2004 3,000 2,742 Enron Corp. 5.510% due 09/10/2001 (d) 1,000 1,001 8.000% due 08/15/2005 8,300 8,901 Federal-Mogul Corp. 7.500% due 07/01/2004 28,600 4,433 Ford Motor Co. 9.000% due 09/15/2001 500 508 Fred Meyer, Inc. 7.150% due 03/01/2003 13,500 13,999 General Motors Corp. 6.250% due 05/01/2005 7,000 7,065 Global Crossing Holding Ltd. 6.000% due 10/15/2013 7,500 7,110 HCA - The Healthcare Co. 8.130% due 08/04/2003 5,000 5,184 6.630% due 07/15/2045 7,000 7,071 HMH Properties, Inc. 7.875% due 08/01/2005 5,000 4,863 IMEXSA Export Trust 10.125% due 05/31/2003 5,718 5,564 International Game Technology 7.875% due 05/15/2004 500 508 Kroger Co. 6.340% due 06/01/2001 5,000 5,006 Lockheed Martin Corp. 6.850% due 05/15/2001 7,300 7,310 Nabisco, Inc. 6.700% due 06/15/2002 21,100 21,207 Occidental Petroleum Corp. 6.400% due 04/01/2003 15,945 16,057 Park Place Entertainment Corp. 7.950% due 08/01/2003 15,955 16,394 Petroleos Mexicanos 7.845% due 07/15/2005 (d) 10,400 10,426 7.769% due 07/15/2005 (d) 10,173 10,198 9.375% due 12/02/2008 5,500 5,734 Philip Morris Cos., Inc. 7.250% due 09/15/2001 500 504 7.500% due 01/15/2002 200 203 7.250% due 01/15/2003 4,050 4,174 8.250% due 10/15/2003 1,000 1,066 6.950% due 06/01/2006 25,000 25,031 Phillips Petroleum Co. 8.500% due 05/25/2005 2,000 2,201 Qwest Corp. 7.625% due 06/09/2003 25,000 25,930 5.650% due 11/01/2004 9,250 8,998 R & B Falcon Corp. 6.500% due 04/15/2003 11,000 11,094 Raytheon Co. 5.739% due 08/10/2001 (d) 500 501 Rollins Truck Leasing Co. 8.000% due 02/15/2003 3,000 3,143 Shoppers Food Warehouse Corp. 9.750% due 06/15/2004 10,500 10,978 Starwood Hotels & Resorts 6.750% due 11/15/2005 2,000 1,981 TCI Communications, Inc. 5.580% due 03/11/2003 (d) 3,000 3,018 Tenet Healthcare Corp. 7.875% due 01/15/2003 5,300 5,413 8.625% due 12/01/2003 9,700 10,078 Time Warner, Inc. 7.975% due 08/15/2004 1,950 2,080 TTX Co. 7.820% due 07/21/2003 61,000 64,243 Tyco International Group SA 6.875% due 09/05/2002 18,805 19,096 Union Oil Co. of California 9.100% due 08/15/2001 3,350 3,397 Waste Management, Inc. 6.500% due 05/15/2004 45,000 45,007 Yorkshire Power 6.154% due 02/25/2003 40,000 40,019 ----------- 552,347 ----------- Utilities 11.2% Arizona Public Service Co. 5.875% due 02/15/2004 5,600 5,599 Arkansas Power & Light 6.000% due 10/01/2003 450 450 BellSouth Telecommunications, Inc. 6.000% due 06/15/2002 3,000 3,036 British Telecommunications PLC 6.079% due 12/15/2003 (d) 9,900 9,904 7.625% due 12/15/2005 73,400 76,023 Calpine Corp. 9.250% due 02/01/2004 2,960 2,961 CenturyTel, Inc. 7.750% due 10/15/2012 32,000 32,590 Cinergy Corp. 6.125% due 04/15/2004 13,000 12,766 Cleveland Electric Illuminating Co. 8.550% due 11/15/2001 2,075 2,117 7.850% due 07/30/2002 3,500 3,609 9.500% due 05/15/2005 9,000 9,316 CMS Energy Corp. 8.125% due 05/15/2002 5,000 5,064 7.625% due 11/15/2004 15,400 15,295 8.000% due 07/01/2011 5,000 5,011 Connecticut Light & Power Co. 7.875% due 06/01/2001 500 502 8.590% due 06/05/2003 10,000 10,772 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 59 PIMCO Schedule of Investments Class D (Cont.) Low Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- DTE Capital Corp. 8.350% due 11/15/2038 (d) $ 1,000 $ 1,021 Duke Energy Field Services 7.500% due 08/16/2005 1,000 1,053 Entergy Louisiana, Inc. 7.740% due 07/01/2002 3,308 3,314 8.500% due 06/01/2003 4,000 4,216 Entergy Mississippi, Inc. 7.750% due 02/15/2003 35,000 36,214 France Telecom 7.200% due 03/01/2006 29,300 29,818 Illinois Power Co. 6.250% due 07/15/2002 10,000 10,120 6.000% due 09/15/2003 12,500 12,634 Kentucky Power Co. 6.650% due 05/01/2003 1,000 1,002 Kinder Morgan, Inc. 6.450% due 11/30/2001 440 442 Niagara Mohawk Power Co. 7.125% due 07/01/2001 1,512 1,518 7.250% due 10/01/2002 16,634 16,988 Noram Energy Corp. 6.375% due 11/01/2003 2,000 2,043 Ohio Edison Co. 8.625% due 09/15/2003 5,000 5,339 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(i) 46,700 38,528 Scana Corp. 5.910% due 02/08/2002 (d) 1,000 1,001 Sprint Capital Corp. 9.500% due 04/01/2003 5,800 6,219 Texas Utilities Corp. 5.940% due 10/15/2001 13,155 13,217 6.500% due 08/16/2002 1,000 1,014 9.700% due 02/28/2003 4,695 5,075 6.750% due 03/01/2003 925 944 6.750% due 04/01/2003 3,875 3,958 6.875% due 08/01/2005 2,000 2,060 Toledo Edison Co. 8.180% due 07/30/2002 2,500 2,572 United Illuminating Co. 6.000% due 12/15/2003 13,000 13,137 Western Massachusetts Electric Co. 7.750% due 12/01/2002 4,847 4,853 Williams Cos., Inc. 5.889% due 11/15/2001 (d) 6,200 6,209 WorldCom, Inc. 6.125% due 08/15/2001 45,000 45,077 8.875% due 01/15/2006 45,170 46,653 6.125% due 04/15/2012 4,300 4,307 ----------- 515,561 ----------- Total Corporate Bonds & Notes 2,152,048 (Cost $2,154,130) ----------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 1.7% -------------------------------------------------------------------------------- Fannie Mae 4.625% due 10/15/2001 535 535 6.850% due 11/06/2003 30,000 30,415 7.125% due 09/19/2005 25,000 25,862 7.000% due 11/14/2005 15,085 15,613 Federal Home Loan Bank 6.240% due 08/24/2001 210 211 Freddie Mac 5.750% due 06/15/2001 750 752 6.500% due 02/04/2013 1,200 1,184 6.625% due 07/02/2013 1,195 1,184 Small Business Administration 8.250% due 01/25/2013 (d) 249 252 8.250% due 02/25/2014 (d) 705 708 ----------- Total U.S. Government Agencies 76,716 (Cost $75,476) ----------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 9.0% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (h) 3.625% due 07/15/2002 (b) 183,695 187,312 3.375% due 01/15/2007 (j) 50,333 50,884 3.625% due 01/15/2008 (j) 116,814 119,552 3.875% due 01/15/2009 (j) 55,935 58,173 U.S. Treasury Strips 0.000% due 02/15/2019 200 72 ----------- Total U.S. Treasury Obligations 415,993 (Cost $402,940) ----------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 108.2% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 25.4% Amortizing Residential Collateral Trust 5.790% due 09/25/2030 (d) 15,028 15,042 Bear Stearns Adjustable Rate Mortgage Trust 7.490% due 12/25/2030 (d) 17,118 17,297 7.499% due 12/25/2030 (d) 15,967 16,149 Cendant Mortgage Corp. 6.500% due 01/18/2016 455 456 Chase Commercial Mortgage Securities Corp. 7.600% due 12/18/2005 127 133 Chase Mortgage Finance Corp. 10.000% due 11/25/2009 12 12 6.500% due 06/25/2013 5,617 5,699 8.494% due 04/25/2025 (d) 1,487 1,518 6.750% due 07/25/2028 11,250 11,319 6.350% due 07/25/2029 4,186 4,243 Citicorp Mortgage Securities, Inc. 6.875% due 12/01/2019 (d) 375 373 6.750% due 05/25/2028 6,266 6,241 CMC Securities Corp. IV 7.250% due 10/25/2027 12,141 12,482 7.250% due 11/25/2027 10,106 10,389 Collateralized Mortgage Obligation Trust 7.375% due 01/20/2003 (d) 2 2 Commercial Trust 6.670% due 12/15/2003 (d) 3,267 3,134 Countrywide Funding Corp. 6.875% due 01/25/2035 (d) 1,906 1,901 Countrywide Home Loans 6.250% due 07/25/2009 208 208 6.900% due 12/25/2027 18,168 18,423 Criimi Mae Financial Corp. 7.000% due 01/01/2033 8,427 8,510 CS First Boston Mortgage Securities Corp. 6.960% due 01/20/2004 128 131 6.400% due 02/17/2004 119 121 7.500% due 02/25/2031 69,976 71,972 7.500% due 03/25/2031 29,978 30,273 Dime Savings 7.293% due 11/01/2018 (d) 1,143 1,058 DLJ Commercial Mortgage Corp. 7.571% due 09/05/2001 (d) 1,126 1,132 DLJ Mortgage Acceptance Corp. 11.000% due 08/01/2019 622 692 9.308% due 05/25/2024 (d) 826 838 5.978% due 06/25/2026 (d) 8,609 8,493 6.850% due 12/17/2027 165 171 Drexel Burnham Lambert Trust 6.063% due 05/01/2016 (d) 20 20 Enterprise Mortgage Acceptance Co. 6.110% due 07/15/2003 93 94 Fannie Mae 8.950% due 05/25/2003 13 13 9.000% due 07/25/2003 114 116 9.400% due 07/25/2003 30 30 6.875% due 06/25/2009 1,104 1,111 7.000% due 09/25/2016 10,368 10,505 9.250% due 10/25/2018 59 63 8.750% due 05/25/2019 9 9 60 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 9.500% due 03/25/2020 $ 3,880 $ 4,284 9.500% due 05/25/2020 1,115 1,187 6.000% due 12/25/2020 18 17 9.000% due 03/25/2021 2,810 2,969 9.000% due 04/25/2021 96 103 8.000% due 12/25/2021 1,869 1,987 8.000% due 03/25/2022 20 20 5.663% due 04/25/2022 (d) 171 173 5.000% due 01/25/2024 4 4 First Nationwide Trust 7.750% due 10/25/2030 68,388 70,922 Freddie Mac 8.000% due 07/01/2006 35 37 6.000% due 07/15/2006 963 964 6.500% due 08/15/2006 1,473 1,480 8.500% due 01/01/2007 56 59 8.000% due 09/15/2007 673 687 5.750% due 01/15/2008 3,789 3,801 9.500% due 07/01/2010 61 64 6.500% due 08/15/2011 16,492 16,733 8.000% due 01/01/2012 83 83 12.500% due 09/30/2013 487 539 11.750% due 02/01/2014 2 2 6.750% due 06/15/2019 2,603 2,606 10.000% due 07/15/2019 210 225 9.000% due 11/15/2019 367 371 10.000% due 05/15/2020 151 161 7.500% due 12/15/2020 727 732 9.000% due 12/15/2020 2,507 2,640 9.500% due 01/15/2021 861 911 6.500% due 02/15/2021 893 898 8.000% due 04/15/2021 1,025 1,067 9.000% due 05/15/2021 173 181 9.500% due 09/01/2021 29 31 8.000% due 04/01/2022 426 446 8.000% due 11/01/2022 284 297 7.500% due 01/20/2024 3,044 3,064 8.500% due 08/01/2024 110 116 8.500% due 11/01/2024 916 962 6.250% due 04/15/2028 8,260 8,297 6.500% due 10/01/2028 63 63 6.947% due 08/15/2032 (d) 5,259 5,390 General Electric Capital Mortgage Services, Inc. 6.750% due 12/25/2012 2,198 2,217 7.500% due 11/25/2030 30,208 30,816 German American Capital Corp. 7.000% due 08/12/2010 (d) 6,800 7,185 Glendale Federal Savings & Loan 11.000% due 03/01/2010 15 16 7.490% due 03/25/2030 (d) 869 865 GMAC Commercial Mortgage Corp. 6.030% due 02/20/2003 (d) 1,328 1,329 6.476% due 09/20/2005 (d) 200 200 Golden Mortgage Loan 7.875% due 02/25/2031 (d) 17,840 18,100 Government National Mortgage Association 8.000% due 05/20/2020 2,838 2,865 Greenwich Capital Acceptance, Inc. 9.687% due 11/25/2024 (d) 25 25 Guardian Savings & Loan Association 7.557% due 09/25/2018 (d) 28 28 Home Savings of America 6.480% due 05/25/2027 (d) 1,116 1,107 Impac Secured Assets CMN Owner Trust 8.000% due 07/25/2030 100,857 104,598 Imperial Savings Association 8.839% due 06/25/2017 (d) 29 29 9.900% due 02/25/2018 333 337 International Mortgage Acceptance Corp. 12.250% due 03/01/2014 88 102 LB Commercial Conduit Mortgage Trust 6.330% due 11/18/2004 109 112 Mellon Residential Funding Corp. 6.400% due 06/26/2028 16,661 16,758 6.580% due 07/25/2029 (d) 17,411 17,622 Morgan Stanley Capital I 8.287% due 07/15/2005 93 97 7.258% due 01/16/2006 218 229 7.460% due 02/15/2020 25,873 27,175 Morgan Stanley Dean Witter Capital I 6.950% due 10/15/2026 (d) 317 317 Mortgage Capital Funding, Inc. 6.325% due 10/18/2007 20,401 20,830 Nationslink Funding Corp. 6.297% due 12/10/2002 5,000 5,101 Nomura Asset Securities Corp. 6.625% due 01/25/2009 163 163 Norwest Asset Securities Corp. 6.500% due 04/25/2028 1,280 1,302 6.500% due 01/25/2029 6,000 5,981 PNC Mortgage Securities Corp. 6.500% due 02/25/2028 3,864 3,857 6.750% due 05/25/2028 4,271 4,307 7.750% due 07/25/2030 53,197 54,614 7.500% due 05/25/2040 (d) 267 270 PNC Mortgage Trust 8.250% due 03/25/2030 3,396 3,501 Prudential Home Mortgage Securities 7.500% due 10/25/2007 729 746 7.000% due 01/25/2008 10,000 10,118 6.750% due 11/25/2008 5,285 5,315 7.000% due 08/25/2009 4,000 4,070 7.000% due 06/25/2023 2,665 2,683 6.050% due 04/25/2024 87 87 7.300% due 06/25/2024 774 780 Prudential-Bache Trust 6.676% due 09/01/2018 (d) 20 20 8.400% due 03/20/2021 2,981 3,119 Resecuritization Mortgage Trust 5.306% due 04/26/2021 (d) 6,886 6,843 Residential Accredit Loans, Inc. 6.500% due 02/25/2029 (d) 22,057 22,013 7.000% due 07/25/2029 482 487 Residential Asset Securitization Trust 6.500% due 09/25/2014 420 422 Residential Funding Mortgage Securities I 6.500% due 04/25/2009 14 14 7.500% due 12/25/2025 937 971 7.250% due 10/25/2027 14,920 14,963 6.250% due 11/25/2028 6,000 5,756 7.500% due 11/25/2030 36,779 36,787 Residential Funding Mortgage Securities, Inc. 7.000% due 07/25/2012 254 254 6.405% due 07/25/2019 (d) 705 693 7.500% due 08/25/2023 412 415 7.100% due 07/25/2027 3,808 3,815 7.000% due 10/25/2027 10,000 10,204 Resolution Trust Corp. 7.014% due 05/25/2019 (d) 3,100 3,091 6.860% due 08/25/2019 (d) 2,437 2,438 10.320% due 08/25/2021 350 349 8.625% due 10/25/2021 9,165 9,140 4.725% due 10/25/2021 427 408 6.940% due 10/25/2021 (d) 52 52 6.900% due 02/25/2027 2,880 2,800 9.000% due 09/25/2028 121 121 7.380% due 10/25/2028 (d) 710 719 6.209% due 10/25/2028 (d) 1,589 1,654 7.477% due 05/25/2029 (d) 1,988 2,031 Ryland Mortgage Securities Corp. 7.297% due 11/25/2021 (d) 400 400 Salomon Brothers Mortgage Securities VII 7.567% due 12/25/2017 (d) 1,349 1,369 8.391% due 12/25/2017 (d) 115 117 8.950% due 03/25/2024 (d) 815 832 9.120% due 09/25/2024 (d) 194 198 7.600% due 08/25/2030 14,156 14,454 Sasco Floating Rate Commercial Mortgage Trust 5.608% due 11/20/2001 (d) 1,254 1,256 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 61 PIMCO Schedule of Investments Class D (Cont.) Low Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Sears Mortgage Securities 12.000% due 02/25/2014 $ 52 $ 54 7.431% due 10/25/2022 (d) 1,477 1,493 SLH Mortgage Trust 9.600% due 03/25/2021 216 215 Structured Asset Mortgage Investments, Inc. 6.902% due 06/25/2028 (d) 6,095 6,353 6.581% due 06/25/2029 (d) 29,054 29,515 9.030% due 06/25/2029 (d) 7,417 7,970 6.750% due 05/02/2030 3,819 3,771 Structured Asset Securities Corp. 6.750% due 07/25/2029 13,731 13,915 7.750% due 07/25/2030 26,348 27,057 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 9,071 9,071 Torrens Trust 5.424% due 07/15/2031 (d) 9,064 9,064 Union Planters Mortgage Finance Corp. 6.450% due 01/25/2028 6,000 6,025 Wells Fargo Mortgage-Backed Securities Trust 7.000% due 02/25/2016 154,405 158,204 ----------- 1,171,712 ----------- Fannie Mae 8.4% 6.000% due 05/01/2011 125 125 6.318% due 08/01/2029 18,057 18,296 6.500% due 09/01/2005-06/01/2008 (g) 696 708 6.748% due 11/01/2017 (d) 129 131 6.750% due 07/01/2017 (d) 329 333 6.758% due 04/01/2018 (d) 5,955 5,976 6.850% due 08/01/2017 (d) 37 37 6.857% due 12/01/2017-12/01/2023 (d)(g) 373 377 6.860% due 06/01/2017 (d) 70 71 7.000% due 04/01/2002-05/01/2012 (g) 266 272 7.282% due 01/01/2021 (d) 356 356 7.364% due 02/01/2028 (d) 5,087 5,274 7.434% due 07/25/2017 (d) 2,139 2,212 7.645% due 11/01/2017 (d) 277 279 7.766% due 11/01/2018 (d) 130 132 7.796% due 07/01/2017 (d) 435 443 8.000% due 03/01/2004-04/16/2031 (g) 325,049 335,205 8.290% due 10/01/2024 (d) 2,543 2,601 8.291% due 01/01/2024 (d) 103 106 8.351% due 04/01/2024 (d) 1,769 1,822 8.472% due 01/01/2024 (d) 28 29 8.484% due 01/01/2024 (d) 2,024 2,100 8.500% due 03/01/2008-01/01/2026 (g) 3,076 3,220 8.899% due 07/01/2023 (d) 1,245 1,268 9.000% due 01/01/2025 3 3 9.500% due 07/01/2024-11/01/2025 (g) 3,332 3,559 10.000% due 02/01/2004-01/01/2025 (g) 946 1,019 10.500% due 06/01/2005-12/01/2024 (g) 141 152 11.000% due 11/01/2020 39 43 11.250% due 12/01/2010-10/01/2015 (g) 100 112 11.500% due 12/01/2008-02/01/2020 (g) 54 60 11.750% due 02/01/2016 35 40 12.000% due 01/01/2015-10/01/2015 (g) 6 6 13.000% due 07/01/2015 5 6 13.250% due 09/01/2011 12 14 13.500% due 04/01/2014 3 4 15.500% due 10/01/2012-12/01/2012 (g) 51 62 15.750% due 12/01/2011 21 26 16.000% due 09/01/2012-12/01/2012 (g) 9 11 ----------- 386,490 ----------- Federal Housing Administration 1.2% 6.950% due 04/01/2014 2,029 2,068 7.400% due 02/01/2019 91 91 7.421% due 11/01/2019 447 445 7.430% due 10/01/2019-11/01/2025 (g) 53,446 53,253 ----------- 55,857 ----------- Freddie Mac 1.2% 6.000% due 09/01/2006-03/01/2011 (g) 8,960 9,076 6.500% due 02/01/2005 1 1 6.862% due 10/01/2027 (d) 1,006 1,037 7.000% due 05/14/2031 15,200 15,376 7.500% due 09/01/2006-03/01/2017 (d)(g) 241 242 7.625% due 01/01/2017 (d) 35 36 7.637% due 02/01/2020 (d) 2,007 2,038 8.000% due 03/01/2007-12/01/2024 (g) 3,792 3,950 8.250% due 10/01/2007-11/01/2007 (g) 22 23 8.337% due 11/01/2022 (d) 1,367 1,401 8.362% due 06/01/2024 (d) 548 563 8.365% due 11/01/2023 (d) 433 445 8.373% due 03/01/2024 (d) 64 66 8.376% due 10/01/2023 (d) 873 895 8.451% due 01/01/2024 (d) 1,599 1,645 8.500% due 07/01/2001-11/01/2025 (g) 10,498 11,008 8.511% due 07/01/2018 (d) 249 255 8.513% due 09/01/2023 (d) 221 227 8.535% due 12/01/2022 (d) 557 572 8.575% due 01/01/2024 (d) 694 720 8.750% due 04/01/2001-04/01/2002 (g) 14 14 9.000% due 05/01/2002-08/01/2022 (g) 2,725 2,891 9.250% due 07/01/2001 1 1 9.500% due 03/01/2001-02/01/2025 (g) 242 257 9.750% due 03/01/2001-11/01/2008 (g) 536 566 10.000% due 04/01/2015-10/01/2019 (g) 86 92 10.500% due 10/01/2010-02/01/2016 (g) 25 28 10.750% due 09/01/2009-08/01/2011 (g) 287 320 11.500% due 10/01/2015-01/01/2016 (g) 41 47 11.750% due 11/01/2010-08/01/2015 (g) 10 12 12.000% due 09/01/2013 2 2 14.000% due 09/01/2012-04/01/2016 (g) 10 10 14.500% due 12/01/2010 2 3 15.000% due 08/01/2011-12/01/2011 (g) 3 4 15.500% due 11/01/2011 0 0 16.000% due 04/01/2012 0 0 ----------- 53,823 ----------- Government National Mortgage Association 71.9% 6.375% due 05/20/2027 (d) 1,315 1,334 6.500% due 03/20/2023-04/23/2031 (d)(g) 111,439 111,415 7.000% due 03/15/2011-05/21/2031 (g) 452,672 459,180 7.125% due 11/20/2026 (d) 245 251 7.375% due 04/20/2016-06/20/2027 (d)(g) 36,190 36,731 7.500% due 02/15/2022-04/23/2031 (g) 1,309,585 1,342,645 7.625% due 10/20/2023-12/20/2027 (d)(g) 47,207 48,404 7.750% due 08/20/2022-07/20/2027 (d)(g) 64,425 65,942 8.000% due 07/15/2004-04/23/2031 (g) 1,060,864 1,094,119 8.500% due 12/15/2021-02/15/2031 (g) 111,934 116,268 9.000% due 06/20/2016-12/15/2030 (g) 31,879 33,309 9.500% due 10/15/2016-06/15/2025 (g) 105 112 9.750% due 07/15/2013-10/15/2017 (g) 424 459 10.000% due 10/15/2013-11/15/2025 (g) 105 116 10.500% due 11/15/2019-02/15/2021 (g) 15 17 11.000% due 09/15/2010 6 6 11.500% due 08/15/2018 33 37 11.750% due 08/15/2013-08/15/2015 (g) 46 53 12.000% due 06/20/2015 8 9 12.250% due 01/15/2014 36 41 13.000% due 10/15/2013 6 7 13.500% due 05/15/2011-11/15/2012 (g) 20 24 16.000% due 12/15/2011-02/15/2012 (g) 22 26 ----------- 3,310,505 ----------- Stripped Mortgage-Backed Securities 0.1% Fannie Mae (IO) 727.220% due 09/25/2006 20 80 6.000% due 02/25/2008 1,289 51 256.000% due 11/01/2008 19 78 6.500% due 03/25/2009 3,964 367 0.100% due 03/25/2009 (d) 13,512 214 7.500% due 03/25/2019 1,615 52 6.500% due 05/25/2019 6,869 390 6.500% due 04/25/2020 3,777 207 7.000% due 05/25/2021 2,596 169 62 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 859.770% due 02/25/2022 $ 16 $ 200 6.500% due 03/25/2023 2,493 278 4.875% due 03/25/2024 (d) 5,879 269 Fannie Mae (PO) 0.000% due 09/25/2022 23 21 Freddie Mac (IO) 6.000% due 02/15/2006 7 0 998.181% due 07/15/2006 3 7 1019.460% due 08/15/2006 2 5 1194.390% due 12/15/2006 4 16 6.000% due 10/15/2007 192 7 6.000% due 02/15/2008 844 24 7.000% due 08/15/2018 4,260 164 6.500% due 05/15/2019 2,763 125 6.500% due 06/15/2019 1,399 67 1049.620% due 04/15/2021 11 92 6.500% due 04/15/2022 2,055 197 7.000% due 05/15/2023 265 31 4.000% due 01/15/2024 20,919 3,194 Prudential Home Mortgage Securities (IO) 0.300% due 04/25/2009 (d) 44,034 243 ----------- 6,548 ----------- Total Mortgage-Backed Securities 4,984,935 (Cost $4,959,493) ----------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 4.9% -------------------------------------------------------------------------------- Advanta Equipment Receivables 6.640% due 09/16/2002 348 350 Advanta Mortgage Loan Trust 7.760% due 05/25/2018 22,700 23,735 Amresco Residential Securities Mortgage Loan Trust 5.720% due 07/25/2027 (d) 85 85 Bayview Financial Revolving Mortgage 6.350% due 08/25/2029 (d) 6,900 6,960 Bombardier Capital Mortgage 6.605% due 09/15/2010 6,943 6,982 Capital Asset Research Funding LP 6.400% due 12/15/2004 58 58 Cento 6.013% due 03/02/2002 278 280 CIT Marine Trust 5.800% due 04/15/2010 200 202 Comed Transitional Funding Trust 5.290% due 06/25/2003 1,918 1,919 Community Program Loan Trust 4.500% due 10/01/2018 15,367 14,516 Compucredit Credit Card Master Trust 5.789% due 03/15/2007 (d) 32,000 32,000 Conseco Finance 6.940% due 11/15/2014 543 548 Contimortgage Home Equity Loan Trust 6.770% due 01/25/2018 1,000 1,012 Duck Auto Grantor Trust 5.650% due 03/15/2004 2,952 2,962 Embarcadero Aircraft Securitization Trust 5.644% due 08/15/2025 (d) 4,900 4,900 EQCC Home Equity Loan Trust 6.780% due 10/15/2027 (d) 229 229 Equity One ABS, Inc. 7.325% due 02/25/2032 9,400 9,653 GF Funding Corp. 6.890% due 01/20/2006 16,142 16,306 Green Tree Financial Corp. 6.550% due 02/15/2027 10,135 10,340 7.400% due 06/15/2027 12,743 13,356 Green Tree Floorplan Receivables Master Trust 5.921% due 11/15/2004 (d) 1,000 1,000 Green Tree Home Improvement Loan Trust 6.320% due 08/15/2008 970 971 5.334% due 08/15/2029 (d) 599 598 IMC Home Equity Loan Trust 5.223% due 10/20/2027 (d) 3,305 3,307 Irwin Home Equity 7.460% due 11/25/2004 18,321 18,856 Marriott Vacation Club Owner Trust 5.930% due 09/20/2017 (d) 8,294 8,288 Merit Securities Corp. 7.040% due 12/28/2033 16,618 16,697 New York City Tax Lien 6.350% due 07/10/2007 4,850 4,728 Oakwood Mortgage Investors, Inc. 6.950% due 08/15/2027 2,951 2,966 Ocwen Mortgage Loan Asset Backed Certificates 6.060% due 10/25/2029 (d) 561 562 Option One Mortgage Loan Trust 5.340% due 09/25/2030 (d) 5,686 5,695 Pacificamerica Home Equity Loan 5.270% due 03/25/2028 (d) 252 251 Providian Gateway Master Trust 5.849% due 03/16/2009 (d) 8,000 8,000 SallieMae 6.824% due 07/25/2004 (d) 21 21 6.628% due 04/25/2006 (d) 6,531 6,521 Saxon Asset Securities Trust 7.205% due 01/25/2019 275 283 5.760% due 05/25/2029 (d) 1,189 1,190 Southern Pacific Secured Assets Corp. 5.700% due 07/25/2029 (d) 274 273 The Money Store Home Equity Trust 5.344% due 06/15/2029 (d) 533 533 ----------- Total Asset-Backed Securities 227,133 (Cost $223,446) ----------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 0.8% -------------------------------------------------------------------------------- Province of Quebec 6.625% due 10/25/2001 (d) 250 250 Republic of Brazil 7.625% due 04/15/2006 (d) 6,248 5,663 United Mexican States 5.820% due 06/28/2001 10,500 10,519 9.616% due 04/07/2004 (d) 21,530 22,123 ----------- Total Sovereign Issues 38,555 (Cost $38,123) ----------- -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES (e)(f) 1.5% -------------------------------------------------------------------------------- British Telecom PLC 4.726% due 07/27/2001 (d) EC 16,000 14,020 Korea Development Bank 4.885% due 05/14/2001 DM 340 152 2.700% due 08/16/2002 JY 2,000,000 15,991 Republic of Austria 5.500% due 01/15/2010 EC 8,900 8,082 Republic of Colombia 7.000% due 03/06/2002 IL 36,220,000 16,287 United Mexican States 6.000% due 03/28/2002 JY 960,000 8,013 8.750% due 05/30/2002 BP 3,000 4,328 ----------- Total Foreign Currency-Denominated Issues 66,873 (Cost $74,176) ----------- -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 0.0% -------------------------------------------------------------------------------- U.S. Treasury Bond 6.000% due 06/30/2001 Strike @ 93.000 Exp. 05/26/2001 150 2 ----------- Total Purchased Call Options 2 (Cost $3) ----------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 63 PIMCO Schedule of Investments Class D (Cont.) Low Duration Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Fannie Mae (OTC) 8.000% due 06/20/2031 Strike @ 93.734 Exp. 04/02/2001 $ 120,000 $ 0 Government National Mortgage Association (OTC) 8.000% due 06/20/2031 Strike @ 98.000 Exp. 06/13/2001 715,000 27 ----------- Total Purchased Put Options 27 (Cost $75) ----------- -------------------------------------------------------------------------------- PREFERRED STOCK 1.7% -------------------------------------------------------------------------------- Shares Home Ownership Funding 13.331% due 12/31/2049 3,000 2,265 Rhone-Poulenc SA 8.125% due 12/31/2049 13,000 327 SI Financing Trust I 9.500% due 06/30/2026 806,600 20,407 TCI Communications, Inc. 9.720% due 12/31/2036 224,700 5,719 8.720% due 01/31/2045 1,170,100 29,077 10.000% due 05/31/2045 800,300 20,088 ----------- Total Preferred Stock 77,883 (Cost $83,777) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 7.1% -------------------------------------------------------------------------------- Principal Amount (000s) Certificates of Deposit 0.1% Mexico Credit Link 11.384% due 02/22/2002 $ 5,000 5,127 ----------- Commercial Paper 6.7% Abbey National North America 5.070% due 08/06/2001 8,800 8,650 Fannie Mae 4.695% due 09/06/2001 83,800 82,060 Federal Home Loan Bank 4.675% due 09/07/2001 6,000 5,875 General Electric Capital Corp. 4.900% due 04/25/2001 33,000 32,897 Gillette Co. 4.910% due 08/21/2001 8,000 7,849 Glaxo Wellcome 4.970% due 04/30/2001 12,500 12,452 Halifax Building Society 4.600% due 08/02/2001 1,800 1,772 KFW International Finance, Inc. 4.840% due 08/08/2001 1,900 1,867 5.070% due 08/08/2001 3,700 3,636 Morgan Stanley Group, Inc. 5.050% due 04/11/2001 12,500 12,484 National Australia Funding 5.120% due 04/05/2001 12,500 12,495 National Rural Utilities Cooperative Finance Corp. 4.810% due 05/24/2001 4,000 3,972 4.910% due 05/25/2001 12,500 12,410 Swedbank, Inc. 4.930% due 04/25/2001 11,800 11,763 5.020% due 08/08/2001 200 197 4.900% due 08/23/2001 5,000 4,905 UBS Finance, Inc. 5.060% due 04/04/2001 28,800 28,792 5.030% due 08/07/2001 13,000 12,776 4.840% due 08/08/2001 9,500 9,336 5.010% due 08/08/2001 8,000 7,862 4.750% due 09/05/2001 17,000 16,649 4.740% due 09/12/2001 15,000 14,678 ----------- 305,377 ----------- Repurchase Agreement 0.3% State Street Bank 4.600% due 04/02/2001 $ 14,789 $ 14,789 (Dated 03/30/2001. Collateralized by ----------- Federal Farm Credit Bank 5.875% due 07/02/2001 valued at $15,086. Repurchase proceeds are $14,795.) U.S. Treasury Bills 0.0% 5.151% due 05/17/2001 (b)(g) 330 328 ----------- Total Short-Term Instruments 325,621 (Cost $325,580) ----------- Total Investments (a) 181.7% $ 8,365,786 (Cost $8,337,219) Written Options (c) (0.0%) (2,050) (Premiums $1,822) Other Assets and Liabilities (Net) (81.7%) (3,760,447) ----------- Net Assets 100.0% $ 4,603,289 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $8,337,305 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 82,621 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (54,140) ----------- Unrealized appreciation-net $ 28,481 ----------- (b) Securities with an aggregate market value of $10,468 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 5 Year Note (06/2001) 99 $ (26) U.S. Treasury 10 Year Note (06/2001) 48 21 U.S. Treasury 30 Year Bond (06/2001) 61 (69) Euribor Futures (03/2002) 294 342 Eurodollar September Futures (09/2002) 122 (41) Eurodollar March Futures (03/2003) 122 (58) Eurodollar June Futures (06/2002) 122 (36) Eurodollar December Futures (12/2002) 122 (51) ----------- $ 82 ----------- (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/31/2001 18,500,000 $ 171 $ 336 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 27,800,000 270 506 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 06/04/2001 26,600,000 157 503 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 9,300,000 86 169 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/21/2001 19,200,000 588 264 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/27/2001 19,200,000 550 272 ----------- ----------- $ 1,822 $ 2,050 ----------- ----------- 64 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy EC 102,029 04/2001 $ (5,410) Sell 102,029 04/2001 541 Buy 86,029 06/2001 (325) Sell BP 2,588 05/2001 127 Buy JY 2,967,100 04/2001 (576) Sell 2,967,100 04/2001 1,332 Sell 2,967,100 06/2001 598 ------------- $ (3,713) ------------- (f) Principal amount denoted in indicated currency: BP - British Pound DM - German Mark EC - Euro IL - Italian Lira JY - Japanese Yen (g) Securities are grouped by coupon or range of coupons and represent a range of maturities. (h) Principal amount of the security is adjusted for inflation. (i) Security is in default. (j) Subject to financing transaction. (k) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive fixed rate equal to 6.0% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 06/15/2006 $ 2,900 $ 53 Receive fixed rate equal to 5.633% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/02/2004 BP 23,300 305 Receive fixed rate equal to 5.626% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Exp. 02/02/2004 77,600 997 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.805%. Broker: Morgan Stanley Exp. 01/11/2011 JY 14,460,000 (5,083) Receive fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/02/2004 BP 175,100 1,585 Receive fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/02/2004 94,300 853 Receive fixed rate equal to 0.430% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 07/11/2003 $ 20,000 $ 1 Receive fixed rate equal to 0.230% and the Fund will pay to the counterparty at par in the event of default of Associates Corp. 6.000% due 04/15/2003. Broker: Warburg Dillon Read LLC Exp. 01/14/2003 43,000 1 Receive fixed rate equal to 0.510% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 01/25/2005 5,000 0 Receive fixed rate equal to 1.000% and the Fund will pay to the counterparty at par in the event of default of Enron Corp. 6.40% due 07/15/2006. Broker: Lehman Brothers Exp. 12/19/2001 25,000 0 Receive fixed rate equal to 1.25% and the Fund will pay to the counterparty at par in the event of default of MGM Mirage, Inc. Corporate Bond. Broker: Morgan Stanley Exp. 04/13/2001 20,000 0 ----------- $ (1,288) ----------- (l) Reverse repurchase agreements were entered into March 2, 2001 paying interest at 5.390%. The following security was segregated with collateral for reverse repurchase agreements: Type Maturity Value -------------------------------------------------------------------------------- Wells Fargo Mortgage-Backed Securities 02/25/2016 $ 158,204 (m) Short sales open at March 31, 2001 were as follows: Coupon Type (%) Maturity Par Value Proceeds -------------------------------------------------------------------------------- U.S. Treasury Notes 5.875 11/15/2004 137,080 $ 143,205 $ 142,647 U.S. Treasury Notes 6.000 08/15/2004 50,000 52,359 52,230 U.S. Treasury Notes 5.750 10/31/2002 123,200 126,138 125,874 U.S. Treasury Notes 6.750 05/15/2005 110,200 119,152 118,262 U.S. Treasury Notes 6.125 08/31/2002 16,400 16,833 16,748 U.S. Treasury Notes 5.750 11/15/2005 43,000 45,103 44,350 U.S. Treasury Notes 5.125 12/31/2002 103,400 104,927 104,470 U.S. Treasury Notes 4.250 11/15/2003 96,000 95,786 95,491 ----------------------- $ 703,503 $ 700,072 ----------------------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 65 PIMCO Schedule of Investments Class D Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 105.2% -------------------------------------------------------------------------------- Arizona 4.1% Phoenix Industrial Development Authority Revenue Bonds, (GNMA/FNMA/FHLMC Insured), Series 2000-1A 5.875% due 06/01/2016 $ 1,000 $ 1,047 Pima County, Arizona Industrial Development Authority Multi-Family Revenue Bonds, (HUD SECT 8 Insured), Series 1998 5.375% due 06/01/2010 1,210 1,283 Scottsdale, Arizona Industrial Development Authority Hospital Revenue Bonds, (AMBAC Insured), Series 1997-A 6.500% due 09/01/2004 880 962 ----------- 3,292 ----------- California 12.2% Alameda, California Harbor Bay Business Park Assessment Revenue Bonds, Series 1998 5.000% due 09/02/2006 360 360 Capistrano, California Unified School District Special Tax Bonds, Series 1999 5.000% due 09/01/2008 350 356 Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, (MBIA-IBC), Series 1999 0.000% due 01/15/2026 (c) 1,565 1,054 Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, Series 1995 0.000% due 01/01/2026 (c) 1,000 272 Foothill Eastern Transportation Corridor Agency Toll Road Revenue Bonds, (MBIA Insured), Series 1999 0.000% due 01/15/2027 (c) 1,500 978 Irvine, California Special Assessment Bonds, (MBIA-IBC Insured), Series 1998 4.800% due 09/02/2004 150 151 4.900% due 09/02/2005 310 312 5.000% due 09/02/2006 150 151 Irvine, California Special Assessment Bonds, Series 1999 5.000% due 09/02/2005 350 352 5.100% due 09/02/2006 535 541 5.200% due 09/02/2007 255 258 Lake Elsinore, California School Refunding Bonds, Series 1998 5.000% due 09/01/2006 350 352 Los Angeles County, California Transportation Commission Sales Tax Revenue Refunding Bonds, Series 1991-B 6.500% due 07/01/2013 1,000 1,027 Los Angeles, California Community Redevelopment Agency Certificates of Participation Revenue Bonds, Series 1984 7.550% due 11/01/2008 1,075 1,199 Orange County, California Improvement Bonds, Series 1998-A 4.900% due 09/02/2005 245 246 Pittsburg, California Infrastructure Refunding Bonds, Series 1998-A 4.900% due 09/02/2003 150 154 5.000% due 09/02/2004 150 156 Riverside County, California Special Tax Refunding Bonds, Series 1999 4.200% due 09/01/2001 300 301 4.700% due 09/01/2005 170 171 Roseville, California Special Tax Bonds, Series 1999 5.000% due 09/01/2004 350 354 Sacramento County, California Refunding Bonds, Series 1998 4.900% due 09/02/2005 300 302 South Tahoe, California Joint Powers Financing Authority Revenue Bonds, Series 1999-A 7.300% due 10/01/2007 350 358 West Sacramento, California Refunding Bonds, Series 1998 5.000% due 09/02/2004 350 355 ----------- 9,760 ----------- Colorado 6.3% Arapahoe County, Colorado Capital Trust Fund Highway Revenue Bonds, (MBIA Insured), Series 1986 6.150% due 08/31/2026 1,500 1,607 Colorado Housing & Finance Authority Revenue Bonds, (FHA/VA Mortgages Insured), Series 2000-C3 5.700% due 10/01/2022 1,000 1,044 Colorado Housing & Finance Authority Revenue Bonds, Series 2000-D3 6.750% due 04/01/2015 250 280 Colorado Housing & Finance Authority Bonds, Series 2000-B3 6.700% due 10/01/2016 250 278 Colorado Housing & Financial Authority Revenue Bonds, Series 2000 5.150% due 08/01/2007 500 509 Denver, Colorado Health & Hospital Revenue Bonds, Series 1998-A 5.000% due 12/01/2009 1,390 1,310 ----------- 5,028 ----------- Florida 1.3% Gainesville, Florida Revenue Bonds, Series 1979 6.200% due 10/01/2002 210 213 Orange County, Florida Health Facilities Authority Revenue Bonds, (MBIA Insured), Series 1996 6.250% due 10/01/2011 290 335 Orlando, Florida Waste Water System Revenue Bonds, Series 1997-A 6.042% due 10/01/2015 (d) 500 477 ----------- 1,025 ----------- Georgia 0.3% Georgia Municipal Electric Authority Revenue Bonds, (MBIA-IBC Insured), Series 1997 6.500% due 01/01/2012 200 234 ----------- Hawaii 3.2% Hawaii State Housing Financial & Development Corporation Single Family Mortgage Pure Revenue Bonds, Series 1998 4.850% due 07/01/2029 1,500 1,509 Honolulu Hawaii City & County General Obligation Bonds, (MBIA-IBC), Series 1993 5.450% due 09/11/2008 1,000 1,085 ----------- 2,594 ----------- Illinois 8.7% Chicago, Illinois Board of Education General Obligation Bonds, (FGIC Insured), Series 1998 0.000% due 12/01/2020 1,000 352 Chicago, Illinois General Obligation Bonds, (MBIA Insured), Series 2001 0.000% due 01/01/2020 (c) 1,290 762 Chicago, Illinois Park District General Obligation Bonds, (FGIC Insured), Series 1999 4.750% due 01/01/2026 2,750 2,553 Fox Lake, Illinois Water & Sewer Revenue Bonds, (AMBAC Insured), Series 1996 5.750% due 05/01/2013 1,135 1,196 Illinois Educational Facilities Authority Revenues Bonds, Series 1993 5.610% due 07/01/2012 2,000 2,141 ----------- 7,004 ----------- 66 PIMCO Funds Annual Report | 3.31.01 | See accompanying notess Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Indiana 2.5% Indianapolis, Indiana Local Public Improvement Bonds Bank Transportation Revenue Bonds, Series 1992 6.750% due 02/01/2014 $ 1,000 $ 1,179 South Bend, Indiana Redevelopment Authority Lease Revenue Bonds, Series 2000 5.200% due 02/01/2012 230 238 5.500% due 02/01/2015 180 187 5.100% due 02/01/2011 405 420 ----------- 2,024 ----------- Kentucky 7.1% Kentucky State Turnpike Authority Economic Development Road Revenue Bonds, Series 1993 7.294% due 06/06/2012 5,000 5,668 ----------- Louisiana 0.3% Louisiana Local Government Revenue Bonds, (MBIA Insured), Series 2000 5.700% due 01/01/2010 250 268 ----------- Massachusetts 3.2% Massachusetts Housing Finance Agency Revenue Bonds, (AMBAC Insured), Series 1993 5.950% due 10/01/2008 1,500 1,569 Massachusetts State Development Finance Agency Revenue Bonds, (ACA Insured), Series 1999 4.600% due 03/01/2009 400 393 Massachusetts State Development Finance Agency Revenue Bonds, Series 1998 4.700% due 11/01/2007 210 213 4.800% due 11/01/2008 90 91 Massachusetts State Health Facilities Authority Revenue Bonds, Series 1993 5.500% due 10/01/2002 270 265 ----------- 2,531 ----------- Michigan 2.3% Michigan State Environmental Protection General Obligation Bonds, Series 1992 6.250% due 11/01/2012 1,100 1,286 University of Michigan Revenue Bonds, Series 1995 3.750% due 12/01/2027 600 600 ----------- 1,886 ----------- Minnesota 1.3% New Richland, Minnesota Revenue Bonds, Series 1998 4.500% due 08/01/2004 1,000 1,017 ----------- Nevada 0.6% Nevada State General Obligation Bonds, (FGIC Insured), Series 2001 6.690% due 05/15/2028 500 467 ----------- New Hampshire 3.7% New Hampshire Health & Educational Facilities Authority Revenue Bonds, (AMBAC Insured), Series 2002 5.125% due 07/01/2016 2,980 2,969 ----------- New Jersey 20.7% New Jersey Economic Development Authority Revenue Bonds, Series 1998 5.600% due 01/01/2012 1,000 892 0.010% due 04/01/2013 1,595 744 6.375% due 04/01/2018 1,500 1,530 6.375% due 04/01/2031 7,000 7,089 New Jersey Economic Development Authority Revenue Bonds, Series 1999 6.625% due 09/15/2012 3,500 3,650 New Jersey State Highway Authority Gadern Street Parkway General Revenue Bonds, (FGIC Insured), Series 2001 5.500% due 01/01/2015 2,500 2,670 ----------- 16,575 ----------- New Mexico 0.4% Santa Fe County, New Mexico El Castillo Retirement Nursing Home Bonds, Series 1998-A 5.250% due 05/15/2007 315 293 ----------- New York 2.6% Nassau County, New York Tobacco Settlement Corp. Revenue Bonds, Series 1999 5.250% due 07/15/2011 1,000 1,011 New York State Dormitory Authority Revenue Bonds, (ACA Insured), Series 2000 5.850% due 07/01/2010 1,000 1,047 ----------- 2,058 ----------- North Dakota 2.6% Mercer County North Dakota Pollution Control Revenue Bonds, Series 1991 6.900% due 02/01/2019 2,000 2,057 ----------- Pennsylvania 0.1% Delaware County, Pennsylvania Hospital Revenue Bonds, Series 1998 4.900% due 12/01/2008 100 93 ----------- Puerto Rico 1.2% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 5.750% due 07/01/2010 750 813 6.000% due 07/01/2026 150 156 ----------- 969 ----------- South Carolina 3.5% Medical University South Carolina Hospital Facilities Revenue Bonds, Series 1999 5.700% due 07/01/2012 1,000 1,022 South Carolina State Public Service Authority Revenue Bonds, Series 1993 6.838% due 06/28/2013 1,700 1,820 ----------- 2,842 ----------- Tennessee 2.3% Nashville & Davidson County, Tennessee Revenue Bonds, Series 1998 4.450% due 08/01/2007 1,000 1,014 Sullivan County, Tennessee Industrial Development Revenue Bonds, (GNMA Insured), Series 1995 6.250% due 07/20/2015 750 797 ----------- 1,811 ----------- Texas 12.0% Bexar, Texas Metro Water District Waterworks System Revenue Bonds, (MBIA Insured), Series 1998 0.000% due 05/01/2035 2,190 339 Brazos River Authority Texas Revenue Bonds, (MBIA Insured), Series 1998 4.900% due 10/01/2015 1,500 1,517 Dallas-Fort Worth International Airport Facility Improvement Corp. Revenue Bonds, Series 2000 5.950% due 05/01/2029 1,000 1,021 Del Rio Texas Waterworks & Sewer System Revenue Bonds, (MBIA Insured), Series 1993 5.500% due 06/01/2015 2,400 2,436 Houston Independent School District General Obligation Ltd Bonds, (PSF Insured), Series 1999 4.750% due 02/15/2026 1,000 915 Katy, Texas Independent School District General Obligation Ltd Bonds, (PSF-GTD Insured), Series 1998 4.750% due 02/15/2024 1,500 1,384 Lamar, Texas Independent School District General Obligation Bonds, (PSF-GTD Insured), Series 1998 4.750% due 02/15/2020 1,750 1,659 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 67 PIMCO Schedule of Investments Class D (Cont.) Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Midlothian, Texas Independent School District General Obligation Bonds, (PSF-GTD Insured), Series 1999 0.010% due 02/15/2018 $ 1,000 $ 365 ----------- 9,636 ----------- Washington, DC 1.1% District of Columbia General Obligation Bonds, (LOC-Bank of America), Series 1991 3.850% due 06/01/2003 900 900 ----------- West Virginia 1.6% West Virginia State Parkways Economic Development & Tourism Authority Revenue Bonds, (FGIC Insured), Series 1993 7.839% due 05/16/2019 1,200 1,265 ----------- Total Municipal Bonds & Notes 84,266 (Cost $81,840) ----------- U.S. TREASURY OBLIGATIONS 0.1% Treasury Inflation Protected Securities (b) 3.625% due 07/15/2002 109 111 ----------- Total U.S. Treasury Obligations 111 (Cost $109) ----------- SHORT-TERM INSTRUMENTS 0.6% Money Market Fund 0.4% SSgA Tax Free Money Market 3.080% due 04/02/2001 334 334 U.S. Treasury Bills 0.2% 4.862% due 05/17/2001 140 139 ----------- Total Short-Term Instruments 473 (Cost $473) ----------- Total Investments (a) 105.9% $ 84,850 (Cost $82,422) Other Assets and Liabilities (Net) (5.9%) (4,714) ----------- Net Assets 100.0% $ 80,136 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $82,422 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 2,763 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (335) ----------- Unrealized appreciation-net $ 2,428 ----------- (b) Principal amount of the security is adjusted for inflation. (c) Security becomes interest bearing at a future date. (d) Variable rate security. The rate listed is as of March 31, 2001. 68 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes PIMCO Schedule of Investments Class D New York Municipal Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 90.0% -------------------------------------------------------------------------------- New Jersey 21.2% New Jersey Economic Development Authority Revenue Bonds, Series 1998 6.375% due 04/01/2031 $ 850 $ 861 ----------- New York 66.2% Amherst, New York General Obligation, (FGIC Insured), Series 1999-A 5.500% due 12/01/2008 150 164 Edmeston, New York Central School District General Obligation, (MBIA Insured), Series 1999 5.100% due 06/15/2007 150 160 Long Island Power Authority Revenue Bonds, Series 1998 3.750% due 05/01/2033 200 200 Nassau County, New York Individual Development Agency Civic Facilities Revenue Bonds, (LOC-Morgan Guaranty Trust), Series 1998 3.850% due 03/01/2028 (b) 100 100 Nassau County, New York Tobacco Settlement Corp. Revenue Bonds, Series 1999 5.250% due 07/15/2011 150 152 New York City, New York Individual Development Agency Special Facilities Revenue Bonds, Series 1998 5.250% due 12/01/2032 400 364 New York City, New York Individual Development Individual Development Revenue Bonds, Series 1997 5.650% due 10/01/2028 150 137 New York General Obligation, Series 1997-D 5.250% due 08/01/2021 100 101 New York State Dormitory Authority Revenue Bonds, (AMBAC Insured), Series 1998 5.000% due 07/01/2002 150 153 4.750% due 08/01/2027 150 138 New York State Dormitory Authority Revenue Bonds, (FSA Insured), Series 1998 4.750% due 07/01/2008 150 157 New York State Dormitory Authority Revenue Bonds, Series 2000 6.000% due 07/01/2010 150 162 New York State Local Government Assistance Corp. Revenue Bonds, (MBIA Insured), Series 1997-B 5.125% due 04/01/2013 150 156 New York State Power Authority Revenue & General Purpose, Series 1972-E 5.500% due 01/01/2010 125 133 New York State Urban Development Corp. Revenue Bonds, Series 1999 5.000% due 01/01/2005 150 156 Rockland County, New York Solid Waste Management Authority Revenue Bonds, Series 1999-A 4.800% due 12/15/2005 145 150 Suffolk County, New York Individual Development Agency Research Facility Revenue Bonds, (LOC-Morgan Guaranty Trust), Series 1993 3.950% due 07/01/2023 (b) 100 100 ----------- 2,683 ----------- Puerto Rico 2.6% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 6.000% due 07/01/2026 100 104 ----------- Total Municipal Bonds & Notes 3,648 (Cost $3,534) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 8.1% -------------------------------------------------------------------------------- Money Market Fund 7.6% Reich & Tang New York Money Market 2.900% due 04/02/2001 201 201 SSgA Tax Free Money Market 3.080% due 04/02/2001 109 109 ----------- 310 ----------- U.S. Treasury Bills 0.4% 4.890% due 05/17/2001 15 15 ----------- Total Short-Term Instruments 325 (Cost $325) ----------- Total Investments (a) 98.1% $ 3,973 (Cost $3,859) Other Assets and Liabilities (Net) 1.9% 79 ----------- Net Assets 100.0% $ 4,052 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $3,859 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 114 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. 0 ----------- Unrealized appreciation-net $ 114 ----------- (b) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 69 PIMCO Schedule of Investments Class D Real Return Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 35.7% -------------------------------------------------------------------------------- Banking & Finance 23.5% Allied Irish Banks 6.495% due 09/07/2006 (d) $ 1,200 $ 1,211 Allstate Financial Global Funding 7.125% due 09/26/2005 2,500 2,633 Associates Corp. of North America 5.400% due 08/27/2001 (d) 1,500 1,504 7.003% due 05/08/2003 (d) 1,500 1,503 AT&T Capital Corp. 7.110% due 09/13/2001 500 504 5.881% due 04/23/2002 (d) 1,000 1,002 Atlas Reinsurance PLC 9.071% due 04/04/2003 (d) 3,500 3,500 10.470% due 10/04/2004 (d) 4,400 4,400 Bear Stearns Co., Inc. 5.900% due 08/01/2002 (d) 500 500 5.270% due 09/21/2004 (d) 1,000 1,000 Chase Manhattan Corp. 5.360% due 12/10/2001 (d) 500 501 CIT Group, Inc. 6.750% due 05/14/2001 1,000 1,002 Citicorp 4.992% due 09/17/2001 (d) 335 335 Dime Bancorp, Inc. 7.000% due 07/25/2001 4,225 4,235 Donaldson, Lufkin & Jenrette, Inc. 7.210% due 04/25/2003 (d) 7,500 7,503 DQE Capital Corp. 7.233% due 01/15/2002 (d) 1,000 1,000 Export-Import Bank Korea 6.500% due 11/15/2006 2,500 2,547 Finova Capital Corp. 6.040% due 11/08/2002 (d) 2,800 2,299 First Union Corp. 7.550% due 08/18/2005 10,000 10,610 Florida Windstorm Underwriting Association 6.700% due 08/25/2004 500 511 Ford Motor Credit Co. 6.993% due 07/16/2002 (d) 1,000 1,000 6.885% due 02/13/2003 (d) 350 348 5.190% due 06/20/2003 (d) 18,500 18,484 General Motors Acceptance Corp. 5.273% due 12/09/2002 (d) 2,000 2,003 7.035% due 07/21/2003 (d) 3,500 3,505 Gold Eagle Capital Ltd. 11.078% due 04/15/2001 2,440 2,440 9.748% due 04/15/2001 1,000 1,000 Heller Financial, Inc. 6.893% due 04/26/2002 (d) 250 250 6.500% due 07/22/2002 1,000 1,015 7.500% due 08/23/2002 8,200 8,414 6.635% due 04/28/2003 (d) 3,000 2,992 Household Finance Corp. 5.772% due 08/06/2002 (d) 2,000 2,006 J.P. Morgan & Co., Inc. 6.654% due 02/15/2012 (d) 3,170 2,895 Juno RE Ltd. 10.367% due 06/26/2002 (d) 8,050 7,849 Korea Development Bank 5.885% due 03/01/2002 (d) 500 488 8.008% due 06/16/2003 (d) 500 490 Lehman Brothers Holdings, Inc. 5.388% due 06/03/2002 (d) 2,500 2,502 7.533% due 07/15/2002 (d) 600 604 7.015% due 09/03/2002 (d) 2,000 2,000 MBNA America Bank NA 6.560% due 04/25/2002 (d) 500 500 Merrill Lynch & Co. 6.791% due 11/01/2001 (d) 1,700 1,702 7.085% due 02/08/2002 (d) 400 401 6.768% due 02/04/2003 (d) 2,000 2,003 6.991% due 08/01/2003 (d) 4,000 4,011 Monumental Global Funding II 5.106% due 09/26/2003 (d) 2,000 2,001 Morgan Stanley, Dean Witter & Co. 6.883% due 04/15/2002 (d) 1,000 1,002 5.583% due 02/21/2003 (d) 1,500 1,502 6.767% due 03/13/2003 (d) 2,000 2,000 National Australia Bank Ltd. 6.035% due 05/19/2010 (d) 1,500 1,510 National Rural Utilities Cooperative Finance Corp. 6.880% due 05/31/2002 (d) 1,900 1,902 5.337% due 08/13/2002 (d) 10,000 10,002 National Westminster Bank PLC 5.520% due 09/16/2002 (d) 3,500 3,512 NeHi, Inc. 11.310% due 06/09/2003 (d) 3,000 3,030 Old Kent Bank 6.275% due 11/01/2005 (d) 1,000 999 Pemex Finance Ltd. 6.125% due 11/15/2003 367 364 Premium Asset Trust 7.078% due 11/27/2004 (d) 5,000 5,011 Protective Life Funding Trust 7.090% due 01/17/2003 (d) 1,000 1,002 Prudential Funding Corp. 5.968% due 10/18/2001 (d) 3,000 3,004 6.375% due 07/23/2006 2,000 2,026 PS Colorado Credit Corp. 7.398% due 05/30/2002 (d) 1,300 1,299 Qwest Capital Funding, Inc. 7.195% due 07/08/2002 (d) 1,000 1,001 Residential Reinsurance 10.836% due 06/01/2001 (d) 7,200 7,265 10.926% due 06/01/2001 (d) 9,000 9,000 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 17,433 17,528 6.962% due 04/28/2003 (d) 3,000 3,003 Seismic Ltd. 10.901% due 01/01/2002 (d) 2,500 2,485 Textron Financial Corp. 6.963% due 10/26/2001 (d) 2,500 2,504 7.033% due 09/17/2002 (d) 5,000 5,009 5.423% due 12/09/2002 (d) 1,000 1,002 Toyota Motor Credit Corp. 5.388% due 02/15/2002 (d) 400 401 Western Capital 10.665% due 01/07/2003 5,000 5,003 ----------- 211,569 ----------- Industrials 5.8% AIC Corp. 6.153% due 10/02/2002 (d) 250 250 Alpha Wind 11.321% due 05/23/2001 (d) 1,500 1,500 Coastal Corp. 7.330% due 07/21/2003 (d) 8,000 8,022 Cox Enterprises, Inc. 7.658% due 05/01/2033 (d) 2,000 2,001 DaimlerChrysler North America Holding Corp. 5.790% due 12/16/2002 (d) 2,000 1,992 7.078% due 08/16/2004 (d) 5,000 4,874 Delta Air Lines, Inc. 8.540% due 01/02/2007 3,734 3,825 Enron Corp. 5.510% due 09/10/2001 (d) 2,500 2,502 8.000% due 08/15/2005 3,000 3,217 Fred Meyer, Inc. 7.375% due 03/01/2005 2,000 2,095 Global Crossing Holding Ltd. 6.000% due 10/15/2013 1,250 1,185 HCA - The Healthcare Co. 6.442% due 09/19/2002 (d) 8,000 8,000 Petroleos Mexicanos 9.500% due 09/15/2027 4,750 4,976 Philip Morris Cos., Inc. 7.250% due 09/15/2001 1,000 1,007 70 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Raytheon Co. 7.020% due 08/10/2001 (d) $ 1,600 $ 1,602 Staples, Inc. 6.195% due 11/26/2001 (d) 2,000 2,002 United Air Lines, Inc. 5.272% due 12/02/2002 (d) 1,179 1,177 Waste Management, Inc. 7.100% due 08/01/2026 1,500 1,521 ----------- 51,748 ----------- Utilities 6.4% Allete 7.610% due 10/20/2003 (d) 2,500 2,503 Commonwealth Edison Co. 7.158% due 09/30/2002 (d) 1,000 1,001 Deutsche Telekom AG 7.750% due 06/15/2005 10,000 10,333 Dominion Resources, Inc. 7.230% due 09/16/2002 (d) 3,500 3,514 7.600% due 07/15/2003 5,000 5,206 Entergy Gulf States, Inc. 6.303% due 06/02/2003 (d) 4,500 4,506 Hawaiian Electric Industries, Inc. 7.783% due 04/15/2003 (d) 2,000 2,002 Oneok, Inc. 6.231% due 04/24/2002 (d) 2,000 2,003 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(i) 5,000 4,125 Public Service Enterprise Group, Inc. 5.408% due 06/15/2001 (d) 500 500 Scana Corp. 7.253% due 02/08/2002 (d) 1,900 1,902 7.393% due 07/15/2002 (d) 3,900 3,907 Sierra Pacific Resources 6.298% due 04/20/2002 (d) 1,000 850 7.340% due 04/20/2003 (d) 2,000 1,700 Sprint Capital Corp. 5.678% due 11/15/2001 (d) 1,000 1,001 5.410% due 06/10/2002 (d) 3,000 3,005 Texas Utilities Corp. 5.420% due 06/25/2001 (d) 1,300 1,300 5.781% due 09/24/2001 (d) 500 499 Vodafone Group PLC 5.080% due 12/19/2001 (d) 6,500 6,511 WorldCom, Inc. 7.375% due 01/15/2003 1,000 1,012 ----------- 57,380 ----------- Total Corporate Bonds & Notes 320,697 (Cost $319,838) ----------- -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.6% -------------------------------------------------------------------------------- Florida 0.4% Tampa, Florida Utility Tax & Special Revenue Bond, (AMBAC Insured), Series 2000 6.000% due 10/01/2004 3,580 3,853 ----------- New Mexico 0.0% New Mexico Mortgage Finance Authorities Revenue Bonds, (GNMA, FNMA, FHLMC Insured), Series 1997 7.000% due 07/01/2006 215 225 ----------- New York 0.0% New York City General Obligation Bonds 5.660% due 08/01/2002 (d) 76 76 ----------- Ohio 0.2% Hamilton, Ohio School Districts Gas Supply Revenue Bonds, Northern Ohio, (MBIA Insured), Series 1999 6.910% due 08/01/2001 1,500 1,512 ----------- Total Municipal Bonds & Notes 5,666 (Cost $5,510) ----------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 1.2% -------------------------------------------------------------------------------- Fannie Mae 5.440% due 03/13/2002 (d) 6,100 6,128 Federal Farm Credit Bank 2.868% due 02/14/2002 (d) 600 602 Federal Home Loan Bank 5.917% due 02/15/2002 (d) 2,485 2,497 SallieMae 6.779% due 10/25/2004 (d) 56 56 6.787% due 04/25/2006 (d) 1,245 1,243 6.694% due 01/25/2007 (d) 249 249 ----------- Total U.S. Government Agencies 10,775 (Cost $10,662) ----------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 107.8% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (g) 3.625% due 07/15/2002 (b)(c) 192,506 196,296 3.375% due 01/15/2007 (c) 166,955 168,782 3.625% due 01/15/2008 163,335 167,163 3.875% due 01/15/2009 (c) 151,184 157,231 3.625% due 04/15/2028 94,944 96,813 3.875% due 04/15/2029 (c) 170,847 182,379 ----------- Total U.S. Treasury Obligations 968,664 (Cost $935,531) ----------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 2.0% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 2.0% Bear Stearns Adjustable Rate Mortgage Trust 7.674% due 11/25/2030 (d) 4,754 4,775 CMC Securities Corp. 6.000% due 11/25/2008 207 207 Fannie Mae 5.462% due 10/25/2008 (d) 108 108 6.500% due 02/25/2029 126 105 Freddie Mac 7.000% due 07/15/2022 1,827 1,837 6.500% due 01/25/2028 100 98 7.000% due 10/15/2030 3,000 3,069 GMAC Commercial Mortgage Asset Corp. 5.307% due 07/20/2002 (d) 7,401 7,401 ----------- 17,600 ----------- Fannie Mae 0.0% 9.021% due 10/01/2024 (d) 410 424 ----------- Federal Housing Administration 0.0% 7.430% due 12/01/2020 296 296 ----------- Total Mortgage-Backed Securities 18,320 (Cost $18,228) ----------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 3.9% -------------------------------------------------------------------------------- AESOP Funding II LLC 5.830% due 11/20/2006 (d) 14,000 13,924 AFC Home Equity Loan Trust 5.270% due 03/25/2027 (d) 170 170 American Residential Eagle Trust 5.870% due 07/25/2029 (d) 5,453 5,466 Asset Backed Securities Corp. Home Equity 5.377% due 06/21/2029 (d) 4,451 4,465 Conseco Finance 7.890% due 07/15/2018 2,000 2,095 8.170% due 12/15/2025 2,000 2,103 Conseco Finance Home Loan Trust 8.880% due 06/15/2024 750 797 EQCC Home Equity Loan Trust 5.483% due 03/20/2029 (d) 165 165 IMC Home Equity Loan Trust 6.610% due 06/20/2013 28 28 MMCA Automobile Trust 6.300% due 06/15/2002 567 568 Onyx Acceptance Auto Trust 6.590% due 09/15/2002 187 188 6.350% due 10/15/2003 239 239 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 71 PIMCO Schedule of Investments Class D (Cont.) Real Return Bond Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SallieMae 6.481% due 07/25/2004 (d) $ 52 $ 52 USAA Auto Loan Grantor Trust 5.800% due 01/15/2005 177 178 Voicestream Vender Facility 9.620% due 06/30/2009 5,000 4,965 ----------- Total Asset-Backed Securities 35,406 (Cost $35,210) ----------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 0.0% -------------------------------------------------------------------------------- United Mexican States 0.000% due 06/30/2003 718 9 ----------- Total Sovereign Issues 9 (Cost $0) ----------- -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES (e)(f) 1.1% -------------------------------------------------------------------------------- Caisse D'amort Dette Soc 3.800% due 07/25/2006 EC 5,084 4,553 Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 4,800 2,127 Newcourt Credit Group, Inc. 7.625% due 06/28/2001 C$ 500 318 Republic of France 3.000% due 07/25/2009 EC 2,553 2,177 United Mexican States 1.352% due 12/31/2019 (d) JY 70,000 547 ----------- Total Foreign Currency-Denominated Issues 9,722 (Cost $10,365) ----------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 0.4% -------------------------------------------------------------------------------- Industrial 0.4% Nabors Industries, Inc. 0.010% due 06/20/2020 $ 5,000 3,538 ----------- Total Convertible Bonds & Notes 3,538 (Cost $3,097) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 20.6% -------------------------------------------------------------------------------- Commercial Paper 20.5% Abbey National North America 5.240% due 04/10/2001 2,200 2,197 4.930% due 08/01/2001 7,100 6,983 American Express Credit Corp. 5.300% due 04/04/2001 5,000 4,999 6.250% due 04/06/2001 4,700 4,697 6.360% due 04/06/2001 600 600 Becton Dickinson & Co. 6.110% due 04/09/2001 600 599 Campbell Soup Co. 6.270% due 04/16/2001 300 299 Coca-Cola Co. 5.140% due 04/12/2001 2,000 1,997 Fannie Mae 4.700% due 05/16/2001 500 497 Federal Farm Credit Bank 4.630% due 08/29/2001 19,000 18,624 General Electric Capital Corp. 5.470% due 04/18/2001 700 699 4.900% due 04/25/2001 8,700 8,673 5.350% due 05/09/2001 9,000 8,951 4.870% due 05/30/2001 8,500 8,433 4.600% due 07/18/2001 1,600 1,577 Halifax PLC 5.300% due 06/06/2001 12,500 12,386 5.010% due 08/08/2001 900 884 KFW International Finance, Inc. 5.170% due 06/27/2001 19,000 18,778 5.010% due 08/08/2001 600 590 National Rural Utilities Cooperative Finance Corp. 5.130% due 04/17/2001 7,000 6,985 5.280% due 04/19/2001 4,300 4,289 4.880% due 05/25/2001 6,600 6,553 SBC Communications, Inc. 5.290% due 04/10/2001 6,400 6,392 Swedbank, Inc. 5.020% due 08/08/2001 4,600 4,521 UBS Finance, Inc. 5.470% due 04/09/2001 4,400 4,395 5.410% due 05/16/2001 600 596 5.290% due 06/13/2001 12,500 12,375 5.040% due 08/02/2001 2,500 2,459 5.070% due 08/08/2001 1,500 1,474 5.040% due 08/15/2001 2,800 2,749 4.750% due 09/05/2001 3,000 2,938 4.740% due 09/06/2001 8,600 8,422 Verizon Global Funding 5.010% due 05/16/2001 10,000 9,939 4.950% due 06/15/2001 3,500 3,464 Walt Disney Co. 4.900% due 08/07/2001 5,000 4,914 ----------- 184,928 ----------- Repurchase Agreement 0.1% State Street Bank 4.600% due 04/02/2001 673 673 (Dated 03/30/2001. Collateralized by Freddie Mac 6.680% due 12/28/2001 valued at $690. Repurchase proceeds are $673.) ----------- Total Short-Term Instruments 185,601 (Cost $185,577) ----------- Total Investments (a) 173.3% $ 1,558,398 (Cost $1,524,018) Other Assets and Liabilities (Net) (73.3%) (659,298) ----------- Net Assets 100.0% $ 899,122 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,524,669 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 36,825 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (3,096) ----------- Unrealized appreciation-net $ 33,729 ----------- (b) Securities with an aggregate market value of $889 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 2 Year Note (06/2001) 85 $ (88) United Kingdom 90 Day LIBOR Futures (09/2002) 38 (3) ----------- $ (91) ----------- (c) Subject to financing transaction. (d) Variable rate security. The rate listed is as of March 31, 2001. 72 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Sell C$ 560 04/2001 $ 7 Buy EC 7,813 04/2001 (26) Sell 7,813 04/2001 372 Sell 7,813 06/2001 26 Sell JY 78,994 04/2001 35 Buy 78,994 04/2001 (15) Sell 78,994 06/2001 15 Sell N$ 5,169 04/2001 89 ------------ $ 503 ------------ (f) Principal amount denoted in indicated currency: C$ - Canadian Dollar EC - Euro JY - Japanese Yen N$ - New Zealand Dollar (g) Principal amount of security is adjusted for inflation. (h) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 0.470% and pay a fixed rate equal to 7.750%. Broker: Morgan Stanley Exp. 06/15/2005 $ 10,000 $ (735) Receive floating rate based on 3-month LIBOR plus 0.500% and pay a fixed rate equal to 7.600%. Broker: Lehman Brothers Exp. 07/15/2003 5,000 (235) Receive floating rate based on 3-month LIBOR plus 1.000% and pay to the counterparty the notional amount of $5,000 in exchange for shares of Nabors Industries, Inc. due 6/20/2020 when the convertible debentures mature. Broker: Morgan Stanley Exp. 06/20/2003 3,042 (116) Receive fixed rate equal to 0.410% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Goldman Sachs Exp. 11/10/2002 1,000 0 ------------ $ (1,086) ------------ (i) Security is in default. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 73 PIMCO Schedule of Investments Class D Short Duration Municipal Income Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 95.6% -------------------------------------------------------------------------------- Alaska 2.9% Valdez, Alaska Marine Term Ref-Exxon Pipeline Co. Revenue Bonds, Series 1993 3.700% due 12/01/2033 $ 400 $ 400 ---------- Arizona 3.7% Maricopa County, Arizona Pollution Central Revenue Bonds, Series 1994 3.700% due 05/01/2029 500 500 ---------- California 7.7% East Bay, California Municipal Utility Water System Revenue, Series 1993 5.200% due 06/01/2008 1,000 1,048 ---------- Colorado 5.6% Arapahoe County, Colorado Capital Trust Fund Highway Revenue Bonds, (MBIA Insured), Series 1986 6.150% due 08/31/2026 250 268 Denver, Colorado Health & Hospital Revenue Bonds, Series 1998-A 5.000% due 12/01/2002 500 502 ---------- 770 ---------- Florida 14.6% Atlantic Beach, Florida Health Care Revenue Bonds, (ACA Insured), Series 1999 5.000% due 10/01/2001 500 502 Dade County, Florida Health Facilities Authority Hospital Revenue Bonds, Series 1990 3.750% due 09/01/2020 300 300 Gulf Breeze Florida Revenue Bonds, (MBIA Insured), Series 1997 4.372% due 12/01/2017 (b) 500 479 Orlando, Florida Waste Water System Revenue Bonds, Series 1997-A 6.112% due 10/01/2015 (b) 750 716 ---------- 1,997 ---------- Hawaii 8.9% Hawaii Airport Systems Revenue Bonds, (MBIA Insured), Series 1991 6.600% due 07/01/2004 500 513 Hawaii State General Obligation Bonds, Series 1993 5.500% due 07/01/2001 500 503 Hawaii State Housing Finance & Development Corp. Revenue Bonds, (FNMA Insured), Series 1998 4.250% due 07/01/2001 195 195 ---------- 1,211 ---------- Illinois 2.4% Illinois Educational Facilities Authority Revenues, Series 1993 5.610% due 07/01/2012 300 321 ---------- Kansas 3.7% Burlington, Kansas Pollution Control Revenue Bonds, (MBIA Insured), Series 1991 7.000% due 06/01/2031 500 512 ---------- Maine 4.0% Eastport, Maine Industrial Development Revenue Bonds, (LOC-Wachovia Bank), Series 1989 4.750% due 11/15/2001 250 251 5.100% due 11/15/2003 300 301 ---------- 552 ---------- Massachusetts 3.4% Massachusetts Housing Finance Agency Revenue Bonds, (AMBAC Insured), Series 1993 5.950% due 10/01/2008 250 262 Massachusetts State Health & Educational Facilities Authority Revenue Bonds, Series 1985 3.700% due 01/01/2035 200 200 ---------- 462 ---------- Missouri 5.1% Missouri State Housing Development Community Mortgage Revenue Bonds, (GNMA/FNMA Insured), Series 1996 7.100% due 09/01/2027 175 192 St. Louis, Missouri Airport Revenue Bonds, Series 2000 6.250% due 01/01/2002 500 508 ---------- 700 ---------- Nevada 3.6% Carson City, Nevada School District General Obligation Bond, (FGIC Insured), Series 1990 6.600% due 04/01/2001 485 485 ---------- New Jersey 11.2% New Jersey Economic Development Authority Revenue Bonds, Series 1998 6.375% due 04/01/2018 500 510 6.375% due 04/01/2031 1,000 1,013 ---------- 1,523 ---------- New York 3.7% New York State Dormitory Authority Revenue Bonds, (MBIA Insured), Series 1999 4.300% due 07/01/2002 500 506 ---------- Pennsylvania 3.7% Dauphin County, Pennsylvania General Authority Bond, (AMBAC Insured), Series 1997 4.450% due 09/01/2032 500 503 ---------- Puerto Rico 2.0% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 5.750% due 07/01/2010 250 271 ---------- Rhode Island 3.8% Convention Center Authority Rhode Island Revenue Bonds, (MBIA Insured), Series 1991 6.700% due 05/15/2020 500 512 ---------- Texas 3.7% Dallas-Fort Worth International Airport Facility Improvement Corp. Revenue Bonds, Series 2000 5.950% due 05/01/2029 500 510 ---------- Utah 0.8% Carbon County, Utah Pollution Central Revenue Bonds, Series 1994 3.750% due 11/01/2024 115 115 ---------- Wisconsin 1.1% Oshkosh Water Revenue Bonds, Series 1999 4.700% due 01/01/2002 150 151 ---------- Total Municipal Bonds & Notes 13,049 (Cost $12,861) ---------- 74 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 0.2% -------------------------------------------------------------------------------- Money Market Fund 0.1% SSgA Tax Free Money Market 3.080% due 04/02/2001 $ 17 $ 17 ----------- U.S. Treasury Bills 0.1% 4.890% due 05/17/2001 10 10 ----------- Total Short-Term Instruments 27 (Cost $27) ----------- Total Investments (a) 95.8% $ 13,076 (Cost $12,888) Other Assets and Liabilities (Net) 4.2% 580 ----------- Net Assets 100.0% $ 13,656 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $12,888 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 203 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (15) ----------- Unrealized appreciation-net $ 188 ----------- (b) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 75 PIMCO Schedule of Investments Class D Short-Term Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 63.1% -------------------------------------------------------------------------------- Banking & Finance 36.6% ABN AMRO Bank 6.625% due 10/31/2001 $ 2,000 $ 2,019 AT&T Capital Corp. 7.000% due 08/15/2001 2,300 2,313 Banco Nacional Obra Services 9.625% due 11/15/2003 3,900 4,115 Bank One Corp. 5.681% due 01/24/2002 (d) 2,000 2,002 BankBoston Corp. 6.125% due 03/15/2002 1,000 1,010 Bear Stearns Co., Inc. 5.270% due 09/21/2004 (d) 3,900 3,901 Chrysler Financial Corp. LLC 5.690% due 11/15/2001 1,200 1,204 CIT Group, Inc. 5.190% due 09/13/2002 (d) 6,300 6,282 Citigroup, Inc. 5.500% due 08/19/2003 (d) 11,040 11,273 DaimlerChrysler Financial Services North America LLC 5.250% due 10/22/2001 2,800 2,788 Dime Bancorp, Inc. 7.000% due 07/25/2001 2,400 2,406 Donaldson, Lufkin & Jenrette, Inc. 6.258% due 07/18/2003 (d) 8,000 8,024 DQE Capital Corp. 6.178% due 01/15/2002 (d) 2,000 2,001 Export-Import Bank Korea 6.500% due 02/10/2002 (d) 1,000 1,006 First USA Bank 5.458% due 05/15/2002 (d) 6,000 5,999 Ford Credit Canada 5.180% due 12/16/2002 (d) 10,000 9,990 Ford Motor Credit Co. 5.400% due 08/27/2006 (d) 6,840 6,840 5.092% due 03/19/2002 (d) 4,295 4,286 5.322% due 06/02/2003 (d) 2,500 2,497 6.178% due 07/18/2005 (d) 10,000 9,842 General Motors Acceptance Corp. 5.510% due 08/18/2003 (d) 16,575 16,560 6.396% due 01/20/2004 (d) 3,900 3,900 Golden State Holdings 6.750% due 08/01/2001 (d) 7,000 6,984 Goldman Sachs Group, Inc. 5.971% due 01/17/2003 (d) 5,000 5,009 Heller Financial, Inc. 5.116% due 06/25/2001 (d) 800 800 5.888% due 04/22/2002 (d) 12,900 12,899 6.500% due 07/22/2002 1,000 1,015 Korea Development Bank 7.125% due 09/17/2001 2,604 2,621 7.900% due 02/01/2002 900 913 7.625% due 10/01/2002 2,500 2,564 Lehman Brothers Holdings, Inc. 6.110% due 05/07/2002 (d) 3,000 3,016 6.771% due 04/04/2003 (d) 3,000 3,004 MBNA Corp. 5.360% due 09/13/2001 (d) 5,000 5,005 Merrill Lynch & Co. 5.805% due 08/01/2003 (d) 4,000 4,011 Morgan Stanley, Dean Witter & Co. 5.722% due 01/28/2002 (d) 8,600 8,616 National Consumer Coop Bank 7.151% due 04/02/2001 (d) 16,000 16,000 6.410% due 10/26/2001 (d) 10,000 10,010 Paine Webber Group, Inc. 6.238% due 07/15/2002 (d) 10,000 10,057 Protective Life Funding Trust 6.088% due 01/17/2003 (d) 2,000 2,003 PS Colorado Credit Corp. 5.843% due 05/30/2002 (d) 2,000 1,998 Qwest Capital Funding, Inc. 6.875% due 08/15/2001 15,430 15,522 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 3,312 3,330 6.018% due 07/18/2007 (d) 5,000 5,011 Transamerica Finance Corp. 5.307% due 12/14/2001 (d) 4,000 4,001 U.S. Bancorp 5.755% due 02/03/2003 (d) 3,700 3,714 ----------- 238,361 ----------- Industrials 15.2% Air Canada 6.037% due 07/31/2005 (d) 1,636 1,516 Clear Channel Communications, Inc. 5.583% due 06/15/2002 (d) 900 903 Coastal Corp. 6.125% due 07/21/2003 (d) 5,000 5,014 DaimlerChrysler North America Holding Corp. 6.670% due 09/25/2001 2,000 2,016 6.670% due 02/15/2002 5,900 5,989 5.640% due 08/23/2002 (d) 5,800 5,752 5.153% due 09/16/2002 (d) 7,000 6,921 5.790% due 12/16/2002 (d) 2,100 2,091 Enron Corp. 5.510% due 09/10/2001 (d) 3,000 3,002 HCA - The Healthcare Co. 6.442% due 09/19/2002 (d) 10,000 9,999 Lockheed Martin Corp. 6.850% due 05/15/2001 10,000 10,014 Petroleos Mexicanos 7.768% due 07/15/2005 (d) 2,000 2,005 9.375% due 12/02/2008 1,000 1,043 Racers 5.713% due 03/03/2003 (d) 10,000 10,005 Raytheon Co. 5.738% due 08/10/2001 (d) 10,000 10,012 Safeway, Inc. 7.000% due 09/15/2002 9,300 9,471 Staples, Inc. 6.195% due 11/26/2001 (d) 1,400 1,402 Time Warner, Inc. 6.100% due 12/30/2001 3,000 3,012 Tyco International Group SA 6.125% due 06/15/2001 6,074 6,079 Waste Management, Inc. 7.125% due 06/15/2001 3,000 3,004 ----------- 99,250 ----------- Utilities 11.3% Allete 6.498% due 10/20/2003 (d) 8,800 8,809 Appalachian Power Co. 5.360% due 06/27/2001 (d) 900 900 British Telecommunications PLC 6.078% due 12/15/2003 (d) 5,000 5,002 Central Power & Light Co. 5.830% due 02/22/2002 (d) 2,000 2,002 CenturyTel, Inc. 7.750% due 10/15/2002 2,000 2,037 Commonwealth Edison Co. 5.527% due 09/30/2003 (d) 2,000 2,001 Deutsche Telekom AG 7.750% due 06/15/2005 5,000 5,166 Dominion Resources, Inc. 5.683% due 09/16/2002 (d) 6,500 6,526 Exelon Corp. 5.625% due 11/01/2001 2,000 2,006 Indiana Michigan Power Co. 5.713% due 09/03/2002 (d) 1,000 1,001 Nevada Power Co. 5.990% due 08/20/2001 (d) 5,000 5,005 Oneok, Inc. 6.231% due 04/24/2002 (d) 5,000 5,009 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (c)(d) 1,900 1,568 7.375% due 11/01/2005 (c) 5,000 3,825 76 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Sierra Pacific Resources 6.298% due 04/20/2002 (d) $ 3,000 $ 2,550 6.248% due 04/20/2003 (d) 5,000 4,251 Texas Utilities Electric Co. 5.650% due 12/20/2002 (d) 3,090 3,091 Williams Cos., Inc. 5.888% due 11/15/2001 (d) 7,500 7,511 WorldCom, Inc. 5.575% due 11/26/2001 (d) 3,700 3,690 7.375% due 01/15/2003 1,500 1,518 ----------- 73,468 ----------- Total Corporate Bonds & Notes 411,079 (Cost $412,244) ----------- -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.3% -------------------------------------------------------------------------------- North Carolina 0.3% North Carolina State Education Assistance Authority Revenue Bonds, (GTD Insured), Series 2000 5.263% due 06/01/2009 (d) 2,000 2,000 ----------- Total Municipal Bonds & Notes 2,000 (Cost $2,000) ----------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 24.5% -------------------------------------------------------------------------------- Fannie Mae 5.750% due 04/15/2003 850 869 Federal Home Loan Bank 6.750% due 02/01/2002 70,000 70,244 6.375% due 11/15/2002 86,200 88,571 ----------- Total U.S. Government Agencies 159,684 (Cost $156,977) ----------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 44.4% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (k) 3.625% due 07/15/2002 149,347 152,287 3.625% due 01/15/2008 (j) 65,247 66,777 U.S. Treasury Notes 6.375% due 01/31/2002 70,000 70,175 ----------- Total U.S. Treasury Obligations 289,239 (Cost $286,251) ----------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 28.6% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 15.4% Bayview Financial Revolving Mortgage 6.350% due 08/25/2029 (d) 2,000 2,017 CDC Depositor Trust I 5.642% due 12/14/2001 (d) 361 362 CMC Securities Corp. 7.500% due 02/25/2023 814 812 Dime Savings 7.292% due 11/01/2018 (d) 170 157 DLJ Acceptance Trust 8.290% due 10/17/2020 (d) 433 444 DLJ Mortgage Acceptance Corp. 7.788% due 09/01/2021 (d) 20 20 Donaldson, Lufkin & Jenrette, Inc. 6.227% due 05/01/2026 (d) 78 79 Fannie Mae 7.250% due 04/25/2007 604 604 6.000% due 02/25/2008 862 866 6.264% due 07/25/2008 (d) 1,216 1,218 6.000% due 12/18/2014 2,874 2,875 6.250% due 06/18/2015 867 869 6.000% due 08/18/2016 22,706 22,828 6.150% due 09/25/2016 3,233 3,233 7.000% due 09/18/2017 6,056 6,083 5.650% due 10/25/2017 (d) 4,539 4,573 5.875% due 03/25/2018 15 15 7.000% due 12/25/2019 9,025 9,081 6.000% due 08/25/2020 1,585 1,586 5.000% due 02/25/2022 7 7 6.500% due 09/18/2023 1,520 1,536 8.915% due 06/25/2032 7,877 8,286 First Nationwide Trust 7.357% due 10/25/2018 (d) 3 3 Freddie Mac 7.000% due 08/15/2006 3,680 3,730 6.750% due 03/15/2007 585 589 6.500% due 10/25/2014 3,503 3,538 6.000% due 01/15/2019 786 789 6.000% due 07/15/2019 3,161 3,168 5.437% due 06/15/2023 (d) 362 363 General Electric Capital Mortgage Services, Inc. 6.750% due 12/25/2012 4,395 4,433 Greenwich Capital Acceptance, Inc. 7.709% due 04/25/2022 (d) 48 48 8.056% due 10/25/2022 (d) 19 19 Housing Securities, Inc. 6.000% due 02/25/2008 94 94 Independent National Mortgage Corp. 7.250% due 11/25/2010 3,534 3,570 Prudential Home Mortgage Securities 6.950% due 11/25/2022 233 230 Prudential-Bache Trust 6.764% due 09/01/2018 (d) 20 20 Residential Funding Mortgage Securities, Inc. 7.142% due 12/01/2018 930 949 Resolution Trust Corp. 7.441% due 05/25/2029 (d) 483 494 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 7,767 7,767 Washington Mutual 7.174% due 01/25/2040 2,952 3,044 ----------- 100,399 ----------- Fannie Mae 0.5% 7.000% due 06/01/2003 1,885 1,918 8.500% due 01/01/2026 1,453 1,519 ----------- 3,437 ----------- Freddie Mac 0.1% 7.500% due 11/01/2001 756 760 ----------- Government National Mortgage Association 12.5% 6.000% due 04/20/2030-05/20/2030 (d)(e) 23,076 23,279 6.500% due 03/20/2030 (d) 22,861 23,055 7.375% due 02/20/2024 (d) 9,220 9,353 7.380% due 04/20/2025 (d) 419 426 7.625% due 11/20/2026 (d) 10,231 10,485 7.750% due 09/20/2023-08/20/2027 (d)(e) 6,083 6,229 8.000% due 04/23/2031 3,950 4,077 8.500% due 06/20/2027 4,160 4,307 ----------- 81,211 ----------- Stripped Mortgage-Backed Securities 0.1% ABN AMRO Mortgage Corp. (IO) 6.750% due 08/25/2029 517 42 Fannie Mae (IO) 7.000% due 07/25/2006 776 21 6.500% due 06/25/2017 74 0 6.500% due 10/25/2023 1,074 120 Freddie Mac (IO) 7.000% due 06/15/2019 2,976 140 ----------- 323 ----------- Total Mortgage-Backed Securities 186,130 (Cost $184,862) ----------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 9.1% -------------------------------------------------------------------------------- Advanta Revolving Home Equity Loan Trust 5.420% due 01/25/2024 (d) 187 187 American Residential Eagle Trust 5.390% due 07/25/2029 (d) 1,454 1,458 Associates Manufactured Housing 7.000% due 03/15/2027 163 164 Brazos Student Loan Finance Co. 6.475% due 06/01/2023 (d) 20,000 19,955 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 77 PIMCO Schedule of Investments Class D (Cont.) Short-Term Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Capital Asset Research Funding LP 6.400% due 12/15/2004 $ 1,542 $ 1,544 CS First Boston Mortgage Securities Corp. 5.423% due 12/15/2030 (d) 3,842 3,846 Delta Funding Home Equity Loan Trust 5.573% due 09/15/2029 (d) 1,543 1,549 First Security Auto Owner Trust 5.580% due 06/15/2003 3,546 3,554 Ford Credit Auto Owner Trust 5.810% due 03/15/2002 121 122 Green Tree Home Improvement Loan Trust 5.333% due 08/15/2029 (d) 1,497 1,495 Metris Master Trust 5.657% due 04/20/2006 (d) 6,000 6,043 MLCC Mortgage Investors, Inc. 5.543% due 03/15/2025 (d) 2,763 2,774 Onyx Acceptance Auto Trust 6.180% due 04/15/2002 2 2 Salomon Brothers Mortgage Securities VII 5.390% due 12/25/2029 (d) 3,934 3,944 5.400% due 07/25/2029 (d) 2,731 2,736 5.743% due 12/15/2029 (d) 2,000 2,006 7.768% due 11/15/2029 (d) 1,369 1,375 Saxon Asset Securities Trust 7.585% due 12/25/2014 3,100 3,121 The Money Store Home Equity Trust 6.635% due 09/15/2014 2,163 2,167 6.345% due 11/15/2021 60 60 UAF Auto Grantor Trust 6.100% due 06/15/2004 676 681 UniCapital Equipment Contract 6.540% due 07/23/2002 435 435 USAA Auto Loan Grantor Trust 5.800% due 01/15/2005 213 214 ----------- Total Asset-Backed Securities 59,432 (Cost $59,230) ----------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 0.6% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (d) 1,760 1,595 Republic of Croatia 7.000% due 02/27/2002 1,000 1,002 Republic of Panama 7.875% due 02/13/2002 1,000 1,009 ----------- Total Sovereign Issues 3,606 (Cost $3,669) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 7.2% -------------------------------------------------------------------------------- Commercial Paper 7.1% Abbey National North America 5.070% due 05/02/2001 300 299 American Express Credit Corp. 5.150% due 04/04/2001 10,000 9,997 Coca-Cola Co. 4.990% due 04/12/2001 1,700 1,698 Federal Home Loan Bank 4.675% due 09/07/2001 1,900 1,860 General Electric Capital Corp. 5.290% due 06/06/2001 200 198 H.J. Heinz Co. 4.860% due 05/01/2001 3,000 2,988 Morgan Stanley, Dean Witter, Discover & Co. 5.050% due 04/11/2001 10,000 9,987 National Rural Utilities Cooperative Finance Corp. 4.910% due 05/25/2001 10,000 9,928 Reseau Ferre De France 4.620% due 08/16/2001 4,000 3,927 UBS Finance, Inc. 5.830% due 06/06/2001 100 99 Williams Cos., Inc. 7.231% due 04/10/2001 5,600 5,602 ----------- 46,583 ----------- Repurchase Agreement 0.1% State Street Bank 4.600% due 04/02/2001 424 $ 424 (Dated 03/30/2001. Collateralized by Freddie Mac ----------- 7.000% due 03/15/2010 valued at $435. Repurchase proceeds are $424.) U.S. Treasury Bills 0.0% 4.890% due 05/17/2001 (b) 50 50 ----------- Total Short-Term Instruments 47,057 (Cost $47,059) ----------- Total Investments (a) 177.8% $ 1,158,227 (Cost $1,152,292) Other Assets and Liabilities (Net) (77.8%) (507,054) ----------- Net Assets 100.0% $ 651,173 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,152,249 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 9,111 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (3,133) ----------- Unrealized appreciation-net $ 5,978 ----------- (b) Securities with an aggregate market value of $50 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts Appreciation -------------------------------------------------------------------------------- United Kingdom 90 Day LIBOR Futures (03/2002) 30 $ 23 United Kingdom 90 Day LIBOR Futures (06/2002) 30 22 United Kingdom 90 Day LIBOR Futures (09/2002) 30 21 United Kingdom 90 Day LIBOR Futures (12/2002) 30 22 ----------- $ 88 ----------- (c) Security is in default. (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Securities are grouped by coupon or range of coupons and represent a range of maturities. (f) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Covered by Settlement Unrealized Type Currency Contract Month Appreciation -------------------------------------------------------------------------------- Sell BP 525 05/2001 $ 25 Sell N$ 40 04/2001 1 ----------- $ 26 ----------- (g) Principal amount denoted in indicated currency: BP - British Pound N$ - New Zealand Dollar 78 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes -------------------------------------------------------------------------------- (h) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 0.470% and pay a fixed rate equal to 7.750%. Broker: Morgan Stanley Exp. 06/15/2005 $ 5,000 $ (367) Receive fixed rate equal to 0.430% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 07/11/2003 5,000 0 Receive fixed rate equal to 0.230% and the Fund will pay to the counterparty at par in the event of default of Associates Corp. 6.000% due 04/15/2003. Broker: Warburg Dillon Read LLC Exp. 01/14/2003 4,000 0 ------------ $ (367) ------------ (i) Reverse repurchase agreements were entered into on various days paying various interest rates. The following securities were segregated with collateral for reverse repurchase agreements: Type Maturity Value -------------------------------------------------------------------------------- Entered into on March 26, 2001 paying interest at 4.880% Government National Mortgage Assn. 7.375% 02/20/2024 $ 9,353 Government National Mortgage Assn. 7.625% 11/20/2026 10,485 Government National Mortgage Assn. 6.000% 05/20/2030 11,116 Government National Mortgage Assn. 6.000% 04/20/2030 12,163 Entered into on March 27, 2001 paying interest at 4.940% Fannie Mae 7.000% 12/25/2019 9,081 Fannie Mae 6.000% 08/18/2016 22,828 ------------ $ 75,026 ------------ (j) Subject to financing transaction. (k) Principal amount of the security is adjusted for inflation. (l) Short sales open at March 31, 2001 was as follows: Coupon Type (%) Maturity Par Value Proceeds -------------------------------------------------------------------------------- U.S. Treasury Notes 5.750 10/31/2002 87,500 $ 89,587 $ 87,412 U.S. Treasury Notes 6.375 01/31/2002 70,000 70,175 70,113 U.S. Treasury Notes 3.625 07/15/2002 64,671 65,944 65,495 Federal Home Loan Bank 6.750 02/01/2002 70,000 70,244 70,094 ------------------------- $ 295,950 $ 293,114 ------------------------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 79 PIMCO Schedule of Investments Class D StocksPLUS Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 29.0% -------------------------------------------------------------------------------- Banking & Finance 11.7% Atlas Reinsurance PLC 9.820% due 10/04/2004 (d) $ 7,000 $ 7,000 Bear Stearns Co., Inc. 6.125% due 02/01/2003 1,100 1,109 Beaver Valley Funding Corp. 8.250% due 06/01/2003 1,193 1,226 Capital One Bank 7.610% due 06/23/2003 (d) 5,400 5,282 Chrysler Financial Corp. LLC 5.745% due 02/10/2003 (d) 9,600 9,476 Donaldson, Lufkin & Jenrette, Inc. 6.022% due 04/25/2003 (d) 6,900 6,903 Ford Credit Canada 6.820% due 12/16/2002 (d) 3,800 3,796 Ford Motor Credit Co. 6.699% due 03/19/2002 (d) 590 589 5.938% due 07/16/2002 (d) 6,800 6,798 6.850% due 03/17/2003 (d) 500 496 General Motors Acceptance Corp. 6.190% due 04/15/2001 (d) 1,000 1,001 Gold Eagle Capital Ltd. 11.078% due 04/15/2001 (d) 10,000 10,000 Golden State Holdings 6.525% due 08/01/2003 (d) 6,000 5,815 Lehman Brothers Holdings, Inc. 6.972% due 06/03/2002 (d) 600 601 6.478% due 07/15/2002 (d) 3,005 3,025 MBNA Corp. 6.980% due 09/13/2001 (d) 3,100 3,103 Nacional Financiera 8.575% due 05/08/2003 (d) 6,000 6,134 National Australia Bank Ltd. 7.385% due 05/19/2010 (d) 11,700 11,781 NationsBank Corp. 3.733% due 02/18/2002 (d) 100 100 Old Kent Bank 6.275% due 11/01/2005 (d) 4,500 4,495 Republic New York Corp. 6.652% due 10/28/2002 (d) 100 100 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (g) 3,400 3,419 6.980% due 02/11/2003 (d) 5,000 5,007 6.530% due 03/26/2003 (d) 5,000 5,013 Western Capital 10.665% due 01/07/2003 16,300 16,310 ------------ 118,579 ------------ Industrials 8.5% Air Canada 6.037% due 07/31/2005 (d) 9,818 9,094 Cemex SA de CV 9.250% due 06/17/2002 300 309 Clear Channel Communications, Inc. 7.210% due 06/15/2002 (d) 600 602 CSX Corp. 7.365% due 06/24/2002 (d) 6,900 6,905 Enron Corp. 5.510% due 09/10/2001 (d) 1,000 1,001 8.000% due 08/15/2005 1,100 1,180 Kroger Co. 6.340% due 06/01/2001 2,000 2,002 Petroleos Mexicanos 7.768% due 07/15/2005 (d) 20,000 20,050 Raytheon Co. 5.738% due 08/10/2001 (d) 8,900 8,910 Rollins Truck Leasing Co. 8.250% due 05/01/2002 29,900 30,708 TCI Communications, Inc. 7.236% due 03/11/2003 (d) 4,000 4,024 TRW, Inc. 6.450% due 06/15/2001 400 400 Waste Management, Inc. 6.000% due 05/15/2001 1,500 1,498 ------------ 86,683 ------------ Utilities 8.8% British Telecommunications PLC 7.722% due 12/15/2003 (d) 10,300 10,304 Central Power & Light Co. 7.420% due 11/23/2001 (d) 3,600 3,604 El Paso Energy Corp. 6.328% due 07/15/2001 (d) 4,800 4,803 Entergy Arkansas, Inc. 7.720% due 03/01/2003 3,700 3,829 Marlin Water Trust 7.090% due 12/15/2001 4,049 4,085 Montana Power Co. 7.000% due 04/06/2001 (d) 1,200 1,201 Nevada Power Co. 5.623% due 06/12/2001 (d) 13,000 13,000 Niagara Mohawk Power Co. 7.125% due 07/01/2001 6,805 6,833 Sprint Capital Corp. 6.927% due 06/10/2002 (d) 1,100 1,102 System Energy Resources, Inc. 7.710% due 08/01/2001 250 252 Texas Utilities Corp. 7.210% due 06/25/2001 (d) 1,900 1,900 5.940% due 10/15/2001 28,725 28,860 6.410% due 11/21/2001 1,000 1,009 Western Massachusetts Electric Co. 7.750% due 12/01/2002 1,882 1,884 Williams Cos., Inc. 7.180% due 11/15/2001 (d) 6,900 6,910 ------------ 89,576 ------------ Total Corporate Bonds & Notes 294,838 (Cost $292,845) ------------ -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 13.3% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (g) 3.625% due 07/15/2002 (b) 114,252 116,500 3.625% due 01/15/2008 17,775 18,192 ------------ Total U.S. Treasury Obligations 134,692 (Cost $131,282) ------------ -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 75.5% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 14.7% Bank Mart 6.883% due 03/01/2018 (j) 3,908 3,961 California Federal Savings & Loan 7.323% due 07/25/2018 (d) 19 19 Countrywide Home Loans 6.050% due 04/25/2029 4,653 4,678 CS First Boston Mortgage Securities Corp. 6.960% due 01/20/2004 1,710 1,746 DLJ Acceptance Trust 7.910% due 10/17/2020 (d) 123 126 Fannie Mae 5.700% due 06/25/2017 62 62 6.761% due 04/25/2020 (d) 18 18 6.500% due 05/18/2024 2,976 3,011 Freddie Mac 7.000% due 06/15/2023 107 107 6.500% due 08/15/2023 6,446 6,499 Fund America Investors Corp. II 8.079% due 06/25/2023 (d) 97 97 General Electric Capital Mortgage Services, Inc. 6.300% due 09/25/2023 1,616 1,620 6.250% due 10/25/2028 614 617 6.250% due 12/25/2028 1,464 1,406 Government National Mortgage Association 6.220% due 02/16/2030 (d) 13,670 13,704 7.250% due 02/16/2030 (d) 23,419 23,463 6.070% due 02/16/2030 (d) 24,934 25,059 6.236% due 06/20/2030 (d) 18,358 18,387 6.236% due 09/20/2030 (d) 289 290 80 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Greenwich Capital Acceptance, Inc. 8.302% due 04/25/2022 (d) $ 166 $ 165 8.230% due 10/25/2022 (d) 5 5 Housing Securities, Inc. 7.320% due 07/25/2032 (d) 400 400 J.P. Morgan & Co., Inc. 6.817% due 01/25/2018 (d) 237 232 Norwest Asset Securities Corp. 6.750% due 08/25/2029 7,443 7,507 PNC Mortgage Securities Corp. 6.625% due 03/25/2028 6,557 6,603 7.500% due 05/25/2040 (d) 5,511 5,589 Resecuritization Mortgage Trust 5.991% due 04/26/2021 (d) 217 215 Residential Funding Mortgage Securities, Inc. 6.798% due 03/25/2018 (d) 1,395 1,387 Resolution Trust Corp. 8.000% due 06/25/2026 562 565 Structured Asset Mortgage Investments, Inc. 9.030% due 06/25/2029 (d) 16,209 17,417 Structured Asset Securities Corp. 7.599% due 09/25/2036 (d) 735 749 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 3,911 3,911 ------------ 149,615 ------------ Fannie Mae 12.4% 6.252% due 12/01/2023 (d) 20 20 6.320% due 05/01/2017 (d) 229 233 6.328% due 02/01/2027-02/01/2031 (d)(i) 686 696 6.446% due 04/01/2018-08/01/2029 (d)(i) 2,677 2,721 6.500% due 09/01/2005 4,723 4,811 7.500% due 04/16/2031 80,000 81,750 7.900% due 05/01/2022 (d) 224 225 8.000% due 04/16/2031 34,000 35,063 ------------ 125,519 ------------ Freddie Mac 0.3% 6.768% due 07/01/2019 (d) 2,373 2,409 7.616% due 12/01/2022 (d) 507 519 8.161% due 06/01/2022 (d) 314 320 8.500% due 04/01/2025-06/01/2025 (i) 181 190 ------------ 3,438 ------------ Government National Mortgage Association 48.0% 6.750% due 07/20/2018-08/20/2026 (d)(i) 14,714 15,064 7.000% due 04/23/2031 101,000 102,579 7.125% due 12/20/2022-12/20/2027 (d)(i) 6,462 6,624 7.375% due 02/20/2026-02/20/2028 (d)(i) 14,566 14,756 7.500% due 08/15/2028-04/23/2031 (i) 198,300 203,306 8.000% due 04/23/2031 141,000 145,347 ------------ 487,676 ------------ Stripped Mortgage-Backed Securities 0.1% Fannie Mae (IO) 7.000% due 07/25/2006 155 4 6.500% due 09/25/2008 161 13 6.500% due 02/25/2021 (d) 1,364 60 7.000% due 07/25/2021 546 61 6.500% due 03/25/2023 2,420 270 Freddie Mac (IO) 6.500% due 08/15/2006 803 23 ------------ 431 ------------ Total Mortgage-Backed Securities 766,679 (Cost $764,294) ------------ -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 9.6% -------------------------------------------------------------------------------- AFC Home Equity Loan Trust 5.200% due 06/25/2028 (d) 5,893 5,878 Amresco Residential Securities Mortgage Loan Trust 6.810% due 07/25/2027 (d) 15 15 5.868% due 05/25/2028 (d) 154 154 Argentina Funding Corp. 5.840% due 05/20/2003 (d) 16,000 16,037 Bayview Financial Acquisition Trust 6.080% due 02/25/2029 (d) 4,493 4,514 Cross Country Master Credit Card Trust II 5.663% due 06/15/2006 (d) 15,400 15,532 Green Tree Home Improvement Loan Trust 6.742% due 11/15/2029 (d) 6,085 6,087 Green Tree Recreational, Equipment, & Consumables 6.430% due 04/17/2006 1,233 1,245 Novastar Home Equity Loan 5.325% due 04/25/2028 (d) 2,632 2,600 SallieMae 5.841% due 07/25/2004 (d) 187 187 5.901% due 10/25/2005 (d) 5,818 5,818 5.961% due 04/25/2006 (d) 2,407 2,404 Salomon Brothers Mortgage Securities VII 5.390% due 02/25/2030 (d) 18,646 18,694 Starwood Hotel 7.241% due 02/23/2003 8,702 8,653 The Money Store Home Equity Trust 6.550% due 09/15/2021 280 280 6.345% due 11/15/2021 120 120 USAA Auto Loan Grantor Trust 6.100% due 02/15/2006 9,530 9,667 ------------ Total Asset-Backed Securities 97,885 (Cost $97,302) ------------ -------------------------------------------------------------------------------- SOVEREIGN ISSUES 11.5% -------------------------------------------------------------------------------- Hydro-Quebec 5.187% due 09/29/2049 (d) 1,200 1,068 Republic of Brazil 7.375% due 04/15/2006 (d) 26,356 23,886 Republic of Croatia 7.000% due 02/27/2002 3,000 3,006 Republic of Germany 3.000% due 06/15/2001 90,000 78,934 Republic of Panama 7.930% due 05/10/2002 824 832 United Mexican States 10.021% due 04/07/2004 (d) 9,000 9,248 ------------ Total Sovereign Issues 116,974 (Cost $119,870) ------------ -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES (e)(f) 2.0% -------------------------------------------------------------------------------- Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 9,750 4,320 Korea Development Bank 2.560% due 06/26/2001 JY 1,000,000 8,000 United Mexican States 8.750% due 05/30/2002 BP 3,000 4,330 7.000% due 06/02/2003 C$ 6,000 3,806 ------------ Total Foreign Currency-Denominated Issues 20,456 (Cost $23,395) ------------ -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 0.0% -------------------------------------------------------------------------------- U.S. Treasury Note (OTC) 5.750% due 11/15/2005 Strike @ 110.875 Exp. 07/02/2001 $ 100,000 16 ------------ Total Purchased Call Options 16 (Cost $16) ------------ See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 81 PIMCO Schedule of Investments Class D (Cont.) StocksPLUS Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Government National Mortgage Association (OTC) 7.000% due 05/21/2031 Strike @ 94.641 Exp. 05/04/2001 $ 100,000 $ 0 Government National Mortgage Association (OTC) 7.500% due 06/20/2031 Strike @ 95.625 Exp. 06/13/2001 369,000 15 PNC Mortgage Securities (OTC) 7.500% due 05/25/2040 Strike @ 100.000 Exp. 04/01/2005 6,200 0 ------------ Total Purchased Put Options 15 (Cost $37) ------------ -------------------------------------------------------------------------------- PREFERRED SECURITY 0.1% -------------------------------------------------------------------------------- Shares -------------------------------------------------------------------------------- DG Funding Trust 7.153% due 12/29/2049 (d) 110 1,122 ------------ Total Preferred Security 1,122 (Cost $1,103) ------------ -------------------------------------------------------------------------------- PREFERRED STOCK 0.8% -------------------------------------------------------------------------------- TCI Communications, Inc. 9.720% due 12/31/2036 303,565 7,726 ------------ Total Preferred Stock 7,726 (Cost $7,996) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 10.2% -------------------------------------------------------------------------------- Principal Amount (000s) -------------------------------------------------------------------------------- Commercial Paper 8.6% American Express Credit Corp. 4.940% due 05/15/2001 $ 6,600 6,561 Gannett Co., Inc. 5.000% due 04/20/2001 24,700 24,637 KFW International Finance, Inc. 4.820% due 05/30/2001 9,900 9,823 Monsanto Co. 4.650% due 08/16/2001 3,600 3,535 Swedbank, Inc. 4.930% due 04/25/2001 9,900 9,869 4.700% due 09/05/2001 14,900 14,592 UBS Finance, Inc. 5.400% due 04/02/2001 15,900 15,900 4.820% due 08/15/2001 2,000 1,964 ------------ 86,881 ------------ Repurchase Agreement 1.6% State Street Bank 4.600% due 03/30/2001 5,844 5,844 (Dated 03/30/2001. Collateralized by Fannie Mae 5.600% due 07/25/2003 valued at $5,965. Repurchase proceeds are $5,846.) Daiwa Securities 5.150% due 04/02/2001 10,000 10,000 (Dated 03/30/2001. Collateralized by U.S. Treasury Bill due 06/28/2001 valued at $10,316. Repurchase proceeds are $10,004.) ------------ 15,844 ------------ U.S. Treasury Bills (b)(i) 0.0% 4.915% due 05/17/2001 510 507 ------------ Total Short-Term Instruments 103,232 (Cost $103,239) ------------ Value (000s) -------------------------------------------------------------------------------- Total Investments (a) 152.0% $ 1,543,635 (Cost $1,541,379) Written Options (c) (0.1%) (815) (Premiums $756) Other Assets and Liabilities (Net) (51.9%) (527,337) ------------ Net Assets 100.0% $ 1,015,483 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,541,331 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 9,728 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (7,424) ------------ Unrealized appreciation-net $ 2,304 ------------ (b) Securities with an aggregate market value of $86,796 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- S&P 500 Index (06/2001) 1,054 $ (27,301) S&P 500 Index (09/2001) 1,573 396 U.S. Treasury 5 Year Note (06/2001) 977 (599) ------------ $ (27,504) ------------ (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Call - CME S&P June Futures Strike @ 1,380.00 Exp. 06/15/2001 56 $ 203 $ 25 Put - CME S&P June Futures Strike @ 1,160.00 Exp. 06/15/2001 56 302 665 Put - CME S&P June Futures Strike @ 1,050.00 Exp. 06/15/2001 28 251 125 ---------------------- $ 756 $ 815 ---------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Sell BP 3,902 05/2001 $ 192 Sell C$ 5,773 04/2001 72 Buy EC 73,359 04/2001 (235) Sell 74,823 04/2001 3,715 Sell 73,359 06/2001 275 Buy HF 2,300,000 09/2001 (171) Buy JY 1,436,697 04/2001 (285) Sell 1,436,697 04/2001 634 Sell 1,436,697 06/2001 282 Sell N$ 10,942 04/2001 187 ------------ $ 4,666 ------------ 82 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes -------------------------------------------------------------------------------- (f) Principal amount denoted in indicated currency: BP - British Pound C$ - Canadian Dollar EC - Euro HF - Hungarian Forint JY - Japanese Yen N$ - New Zealand Dollar (g) Principal amount of the security is adjusted for inflation. (h) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount/Units Appreciation -------------------------------------------------------------------------------- Receive total return on S&P 500 Index and pay floating rate based on 1-month LIBOR plus 0.200%. Broker: Morgan Stanley Exp. 07/06/2001 $ 32,704 $ 0 Receive total return on S&P 500 Index and pay floating rate based on 1-month LIBOR plus 0.300%. Broker: Lehman Brothers Exp. 07/31/2001 4,188 0 Receive total return on S&P 500 Index and pay floating rate based on 1-month LIBOR plus 0.250%. Broker: Morgan Stanley Exp. 10/03/2001 38,761 0 Receive total return on S&P 500 Index and pay floating rate based on 1-month LIBOR plus 0.320%. Broker: J.P. Morgan Exp. 03/20/2002 54,693 0 Receive total return on S&P 500 Index and pay floating rate based on 1 month LIBOR plus 0.180%. Broker: J.P. Morgan Exp. 04/30/2001 11,569 0 Receive a fixed rate equal to 1.290% and the Fund will pay to the counterparty at par in the event of default in of the United Mexican States at 9.750% due 04/06/2005. Broker: J.P. Morgan Exp. 06/19/2002 15,500 2 Receive a fixed rate equal to 0.400% and the Fund will pay to the counterparty at par in the event of default of Enron Corp. Bond. Broker: Morgan Stanley Exp. 06/16/2001 50,000 2 ------------ $ 4 ------------ (i) Securities are grouped by coupon or range of coupons and represent a range of maturities. (j) Restricted security. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 83 PIMCO Schedule of Investments Class D Strategic Balanced Fund March 31, 2001 Value Shares (000s) -------------------------------------------------------------------------------- PIMCO FUNDS (b) 93.5% -------------------------------------------------------------------------------- StocksPLUS 3,982,096 $ 40,618 Total Return 2,761,234 29,048 ------------ Total PIMCO Funds 69,666 (Cost $80,568) ------------ -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 5.7% -------------------------------------------------------------------------------- Principal Amount (000s) -------------------------------------------------------------------------------- Repurchase Agreement 5.7% State Street Bank 4.600% due 04/02/2001 $ 4,279 4,279 (Dated 03/30/2001. Collateralized by Freddie Mac 6.680% due 12/28/2001 valued at $4,369. Repurchase proceeds are $4,281.) ------------ Total Short-Term Instruments 4,279 (Cost $4,279) ------------ Total Investments (a) 99.2% $ 73,945 (Cost $84,847) Other Assets and Liabilities (Net) 0.8% 559 ------------ Net Assets 100.0% $ 74,504 ------------ Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $85,450 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 1,059 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (12,564) ------------ Unrealized depreciation-net $ (11,505) ------------ (b) Institutional Class shares of each PIMCO Fund. 84 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes PIMCO Schedule of Investments Class D Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 35.0% -------------------------------------------------------------------------------- Banking & Finance 22.1% AB Spintab 6.800% due 12/29/2049 $ 250 $ 253 Abbey National Capital Trust I 8.963% due 12/29/2049 31,600 35,041 Abbey National PLC 6.700% due 06/29/2049 5,000 4,839 Abbey National Treasury Service PLC 6.625% due 05/23/2001 240 241 ABN AMRO Mortgage Corp. 7.250% due 05/31/2005 150 158 Aetna, Inc. 6.750% due 08/15/2001 250 251 Air 2 US 8.027% due 10/01/2020 294 313 Allstate Corp. 7.875% due 05/01/2005 100 108 6.750% due 05/15/2018 280 271 6.900% due 05/15/2038 87,200 81,841 AMERCO 7.135% due 10/15/2002 15,000 14,746 7.230% due 01/21/2027 1,250 1,207 American Express Co. 8.500% due 08/15/2001 350 355 5.625% due 01/22/2004 14,700 14,848 7.450% due 08/10/2005 1,000 1,070 American General Finance 6.050% due 07/02/2001 3,000 3,010 6.875% due 12/14/2001 1,600 1,624 7.450% due 07/01/2002 200 206 6.250% due 12/18/2002 1,165 1,191 6.375% due 03/01/2003 350 358 6.170% due 05/06/2003 3,200 3,275 8.125% due 03/15/2046 270 276 American Health Properties, Inc. 7.050% due 01/15/2002 700 700 Aon Capital Trust A 8.205% due 01/01/2027 725 700 Aristar, Inc. 7.375% due 09/01/2004 20,000 20,825 Associates Corp. of North America 6.625% due 05/15/2001 1,300 1,302 6.700% due 05/29/2001 100 100 7.000% due 07/23/2001 500 504 5.400% due 08/27/2001 (d) 13,500 13,539 6.450% due 10/15/2001 23,600 23,801 7.500% due 04/15/2002 185 190 5.446% due 05/21/2002 (d) 6,850 6,857 6.375% due 07/15/2002 175 178 6.500% due 07/15/2002 750 766 6.000% due 12/01/2002 500 508 5.750% due 11/01/2003 5,425 5,477 5.800% due 04/20/2004 450 455 6.625% due 06/15/2005 100 103 AT&T Capital Corp. 6.250% due 05/15/2001 19,443 19,459 7.000% due 08/15/2001 11,100 11,163 7.110% due 09/13/2001 1,030 1,038 6.900% due 01/30/2002 1,000 1,010 6.750% due 02/04/2002 1,925 1,944 5.881% due 04/23/2002 (d) 74,000 74,177 Avalonbay Communities 7.375% due 09/15/2002 2,565 2,629 AVCO Financial Services, Inc. 7.375% due 08/15/2001 300 303 Banco Latinoamericano SA 6.500% due 04/02/2001 950 950 7.173% due 06/04/2001 5,000 5,000 7.878% due 11/30/2001 9,500 9,500 Banco Nacional de Comercio Exterior 7.250% due 02/02/2004 25,050 25,238 Banesto Delaware, Inc. 8.250% due 07/28/2002 43,900 45,508 Bank of America Corp. 9.500% due 04/01/2001 235 235 7.000% due 09/15/2001 1,500 1,513 6.538% due 09/26/2001 (d) 33,000 33,000 6.752% due 02/20/2002 (d) 35,180 35,205 8.125% due 06/15/2002 350 363 6.810% due 06/17/2002 (d) 10,000 10,005 7.750% due 07/15/2002 510 527 7.750% due 08/01/2002 896 898 7.200% due 09/15/2002 1,000 1,030 7.500% due 10/15/2002 1,200 1,244 6.850% due 03/01/2003 65 67 6.875% due 06/01/2003 100 103 6.500% due 08/15/2003 150 154 6.125% due 07/15/2004 600 608 6.750% due 09/15/2005 200 206 8.570% due 11/15/2024 125 141 Bank One Corp. 6.820% due 04/19/2001 (d) 2,000 2,001 6.733% due 09/04/2001 (d) 14,000 14,006 6.348% due 06/26/2002 (d) 5,000 5,002 6.895% due 09/26/2003 (d) 18,400 18,411 BankBoston Corp. 6.125% due 03/15/2002 12,500 12,626 Banponce Financial Corp. 6.463% due 11/13/2001 13,000 13,117 Barclays Bank PLC 8.550% due 09/29/2049 25,000 27,678 Bayerische Landesbank NY 6.200% due 02/09/2006 250 252 Bear Stearns Co., Inc. 9.375% due 06/01/2001 125 126 7.083% due 04/05/2002 (d) 25,000 24,879 5.640% due 05/07/2002 (d) 4,300 4,303 7.134% due 08/01/2002 (d) 71,500 71,556 5.370% due 12/16/2002 (d) 48,900 48,984 6.125% due 02/01/2003 25 25 5.210% due 03/28/2003 (d) 81,500 81,476 6.750% due 04/15/2003 105 107 5.718% due 05/06/2003 (d) 25,000 24,796 7.013% due 05/16/2003 (d) 40,700 40,372 5.820% due 07/22/2003 (d) 19,000 18,795 6.700% due 08/01/2003 100 102 6.625% due 01/15/2004 200 204 6.150% due 03/02/2004 200 201 8.750% due 03/15/2004 75 81 7.156% due 06/01/2004 (d) 12,665 12,518 5.270% due 09/21/2004 (d) 5,200 5,202 7.036% due 03/18/2005 (d) 37,000 37,134 6.848% due 09/16/2005 (d) 16,000 15,763 Beaver Valley Funding Corp. 8.250% due 06/01/2003 405 416 Beneficial Corp. 6.610% due 09/13/2001 140 141 5.409% due 01/09/2002 (d) 500 501 6.870% due 03/01/2002 (d) 50,000 50,109 8.000% due 06/18/2002 400 412 6.030% due 01/14/2003 320 323 Bombardier Capital Trust I 7.210% due 06/09/2032 (d) 16,150 15,914 Bombardier Capital Trust II 7.210% due 06/09/2032 (d) 3,600 3,547 Bombardier Capital, Inc. 7.300% due 12/15/2002 9,000 9,194 Caithness Coso Fund Corp. 6.800% due 12/15/2001 5,659 5,644 Chase Manhattan Bank 6.125% due 11/01/2008 400 391 Chase Manhattan Corp. 8.500% due 02/15/2002 200 206 5.750% due 04/15/2004 150 152 6.000% due 11/01/2005 50 50 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 85 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Chrysler Financial Corp. LLC 5.606% due 06/11/2001 (d) $ 46,700 $ 46,686 5.690% due 11/15/2001 650 652 5.400% due 01/15/2002 15,750 15,671 6.950% due 03/25/2002 50 51 5.701% due 07/17/2002 (d) 20,000 19,823 5.120% due 08/08/2002 (d) 66,100 65,524 5.756% due 02/03/2003 (d) 50,000 49,367 5.150% due 02/10/2003 (d) 7,100 7,008 6.789% due 03/06/2003 (d) 25,000 24,512 5.736% due 03/10/2003 (d) 65,000 63,688 6.739% due 06/18/2003 35,000 34,424 Chubb Capital Corp. 6.875% due 02/01/2003 100 103 Cincinnati Financial Corp. 6.900% due 05/15/2028 111,870 100,124 CIT Group, Inc. 5.800% due 03/26/2002 1,000 1,007 5.190% due 09/13/2002 (d) 30,900 30,810 7.375% due 03/15/2003 500 517 5.625% due 10/15/2003 250 250 Citicorp 8.000% due 02/01/2003 250 262 CitiFinancial Credit Co. 8.250% due 11/01/2001 2,500 2,548 6.875% due 05/01/2002 335 342 6.375% due 09/15/2002 115 117 7.750% due 03/01/2005 550 588 Citigroup, Inc. 5.800% due 03/15/2004 200 203 CNA Financial Corp. 6.250% due 11/15/2003 65 64 Comerica Bank 7.250% due 06/15/2007 200 211 Countrywide Home Loans 6.250% due 04/15/2009 600 585 Credit Asset Receivable 6.274% due 10/31/2003 34,030 34,156 DBS Group Holdings Ltd. 7.875% due 08/10/2009 6,000 6,445 Deutsche Telekom International Finance 7.750% due 06/15/2005 97,100 100,329 Donaldson, Lufkin & Jenrette, Inc. 6.910% due 09/18/2002 (d) 13,600 13,609 6.023% due 04/25/2003 (d) 400 400 6.170% due 07/15/2003 20,000 20,423 Dow Capital BV 7.125% due 01/15/2003 100 103 Duke Capital Corp. 7.250% due 10/01/2004 19,000 19,921 Export-Import Bank Korea 7.250% due 06/25/2001 2,600 2,606 7.125% due 09/20/2001 12,370 12,404 6.500% due 02/10/2002 26,141 26,159 6.500% due 11/15/2006 6,445 6,567 7.100% due 03/15/2007 17,600 18,297 Exxon Capital Corp. 6.125% due 09/08/2008 2,000 2,029 Farmers Insurance 8.625% due 05/01/2024 275 280 Finova Capital Corp. 5.875% due 10/15/2001 (e) 1,000 831 6.040% due 11/08/2002 (d)(e) 51,350 42,159 6.316% due 04/08/2003 (d)(e) 300 246 5.193% due 06/18/2003 (d)(e) 32,300 26,486 6.330% due 11/24/2003 1,300 1,083 First Chicago Corp. 9.250% due 11/15/2001 250 256 6.740% due 03/11/2002 (d) 20,000 20,039 6.884% due 07/28/2003 (d) 50 50 First National Bank Chicago 8.080% due 01/05/2018 250 270 First Security Corp. 5.875% due 11/01/2003 9,325 9,421 First Union Corp. 8.125% due 06/24/2002 150 155 FleetBoston Financial Corp. 9.900% due 06/15/2001 200 202 Ford Credit Canada 6.820% due 12/16/2002 (d) 56,000 55,943 Ford Motor Credit Co. 7.020% due 06/07/2001 1,000 1,003 5.030% due 07/13/2001 (d) 47,700 47,690 6.813% due 09/03/2001 (d) 27,000 27,024 7.000% due 09/25/2001 1,125 1,136 6.918% due 10/15/2001 (d) 13,000 13,005 6.838% due 11/16/2001 (d) 82,800 82,869 8.240% due 01/15/2002 85 87 5.804% due 01/17/2002 (d) 53,945 53,901 8.200% due 02/15/2002 500 513 6.500% due 02/28/2002 1,710 1,732 6.093% due 03/19/2002 (d) 28,458 28,399 6.873% due 04/29/2002 (d) 33,000 33,007 6.961% due 05/21/2002 (d) 7,000 7,005 6.878% due 05/23/2002 (d) 14,000 14,018 6.823% due 06/04/2002 (d) 12,000 12,000 8.000% due 06/15/2002 150 155 5.939% due 07/16/2002 (d) 172,555 172,496 6.911% due 08/01/2002 (d) 36,000 35,989 6.550% due 09/10/2002 4,000 4,064 5.829% due 10/15/2002 (d) 35,050 35,012 7.750% due 11/15/2002 5,730 5,931 6.000% due 01/14/2003 1,100 1,109 7.500% due 01/15/2003 250 258 6.900% due 02/03/2003 (d) 40,000 39,883 5.535% due 02/13/2003 (d) 284,185 282,374 5.133% due 03/17/2003 (d) 37,000 36,723 6.125% due 04/28/2003 26,130 26,409 5.323% due 06/02/2003 (d) 38,100 38,050 6.826% due 06/20/2003 (d) 16,900 16,885 6.625% due 06/30/2003 775 791 5.605% due 11/24/2003 (d) 47,000 46,916 5.750% due 02/23/2004 1,216 1,215 6.125% due 03/20/2004 400 404 5.860% due 04/26/2004 (d) 63,000 62,473 6.951% due 05/21/2004 (d) 32,200 31,883 6.873% due 06/02/2004 (d) 1,500 1,485 7.500% due 06/15/2004 100 105 6.700% due 07/16/2004 92,905 95,111 6.089% due 07/19/2004 (d) 174,500 173,338 8.250% due 02/23/2005 2,500 2,681 7.500% due 03/15/2005 17,000 17,801 6.946% due 04/28/2005 (d) 58,000 56,929 5.353% due 06/30/2005 (d) 65,000 64,244 6.179% due 07/18/2005 (d) 214,000 210,617 7.600% due 08/01/2005 5,000 5,268 6.375% due 12/15/2005 100 101 5.400% due 08/27/2006 (d) 27,500 27,500 7.200% due 06/15/2007 25 26 5.800% due 01/12/2009 155 146 Fuji Bank Ltd. 9.870% due 12/31/2049 (d) 25,475 21,123 General Electric Capital Corp. 6.020% due 05/04/2001 1,000 1,001 5.500% due 11/01/2001 50 50 5.650% due 03/31/2003 125 127 6.210% due 12/09/2005 400 413 7.875% due 12/01/2006 30 33 General Motors Acceptance Corp. 7.125% due 05/01/2001 44,395 44,464 6.750% due 06/05/2001 880 883 6.875% due 07/15/2001 1,000 1,006 6.375% due 12/01/2001 765 772 5.500% due 12/15/2001 100 100 9.625% due 12/15/2001 5,650 5,826 6.625% due 01/10/2002 500 506 6.750% due 02/07/2002 1,590 1,612 7.750% due 03/25/2002 125 129 86 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 6.250% due 08/15/2002 $ 100 $ 101 7.000% due 09/15/2002 250 255 6.625% due 10/01/2002 5,000 5,089 7.103% due 10/07/2002 (d) 18,100 18,124 5.509% due 11/12/2002 (d) 10,200 10,210 5.609% due 11/12/2002 (d) 28,995 28,917 6.860% due 12/09/2002 (d) 64,050 64,157 6.750% due 12/10/2002 500 511 6.200% due 12/15/2002 500 506 5.480% due 12/16/2002 150 150 6.000% due 01/15/2003 990 1,002 5.875% due 01/22/2003 100,500 101,153 5.548% due 02/14/2003 (d) 10,000 9,962 5.210% due 03/10/2003 (d) 7,000 6,970 6.750% due 03/15/2003 49,725 50,906 7.125% due 05/01/2003 36,000 37,054 6.394% due 07/20/2003 (d) 13,042 13,030 5.924% due 07/21/2003 (d) 13,700 13,720 5.510% due 08/18/2003 (d) 128,090 127,973 5.550% due 09/15/2003 32,000 31,954 6.625% due 10/20/2003 2,000 2,046 5.750% due 11/10/2003 1,100 1,102 6.396% due 01/20/2004 (d) 273,857 273,826 5.750% due 03/22/2004 (d) 123,300 123,300 6.536% due 04/05/2004 (d) 43,500 42,879 6.930% due 05/28/2004 (d) 73,000 71,588 6.850% due 06/17/2004 1,200 1,234 5.999% due 07/21/2004 (d) 62,800 62,233 7.291% due 09/20/2004 (d) 19,951 19,933 6.650% due 11/17/2005 500 509 6.150% due 04/05/2007 150 146 8.950% due 07/02/2009 17,333 18,580 Gold Eagle Capital Ltd. 11.079% due 04/15/2001 (d) 46,300 46,300 Golden State Holdings 6.750% due 08/01/2001 (d) 1,950 1,946 7.759% due 08/01/2003 (d) 500 485 Goldman Sachs Group, Inc. 5.971% due 01/17/2003 (d) 72,000 72,124 6.625% due 12/01/2004 275 281 7.625% due 08/17/2005 23,000 24,515 7.458% due 02/09/2009 (d) 10,000 10,084 6.500% due 02/25/2009 140 139 Great Western Finance Trust II 8.206% due 02/01/2027 150 145 Halyard RE 10.555% due 04/05/2002 (d) 1,800 1,800 Hansol Paper Co. Ltd. 8.943% due 05/24/2001 (d) 20,000 20,200 Hartford Life, Inc. 6.900% due 06/15/2004 600 622 Heller Financial, Inc. 6.803% due 06/07/2001 (d) 4,000 4,002 5.116% due 06/25/2001 (d) 101,250 101,288 5.750% due 09/25/2001 1,400 1,405 5.979% due 10/22/2001 (d) 19,200 19,215 6.500% due 11/01/2001 250 252 7.658% due 11/09/2001 (d) 4,400 4,421 5.889% due 04/22/2002 (d) 2,100 2,100 6.940% due 04/26/2002 (d) 12,000 11,992 6.850% due 05/07/2002 (d) 25,400 25,386 6.930% due 05/13/2002 (d) 10,000 9,992 7.000% due 05/15/2002 900 915 6.500% due 07/22/2002 140 142 5.979% due 07/24/2002 (d) 16,200 16,233 5.858% due 04/28/2003 (d) 53,500 53,350 6.989% due 04/28/2003 (d) 26,000 25,960 Hertz Corp. 7.000% due 07/15/2003 13,300 13,684 Hitachi Credit America 5.939% due 10/15/2003 (d) 11,500 11,501 Household Bank 6.961% due 04/03/2001 (d) 16,000 16,000 6.820% due 09/26/2001 (d) 9,000 9,007 6.949% due 10/22/2003 (d) 15,000 14,956 Household Capital Trust III 7.010% due 06/26/2004 (d) 23,925 22,133 Household Finance Corp. 6.490% due 04/09/2001 9,920 9,922 6.780% due 06/22/2001 (d) 3,000 3,000 6.909% due 08/01/2001 (d) 1,500 1,501 6.909% due 11/01/2001 (d) 4,500 4,504 6.876% due 05/07/2002 (d) 43,450 43,252 6.951% due 05/24/2002 (d) 113,800 113,938 7.080% due 06/03/2002 15,000 15,345 5.875% due 11/01/2002 200 202 6.125% due 02/27/2003 500 504 5.116% due 06/24/2003 (d) 31,000 30,897 Household Netherlands BV 6.125% due 03/01/2003 18,100 18,275 HSBC Capital Funding LP 10.176% due 12/29/2049 20,000 20,735 9.547% due 12/31/2049 76,400 88,226 10.176% due 12/31/2049 26,160 32,221 Industrial Bank of Korea 7.100% due 10/15/2001 3,290 3,313 Inter-American Development Bank 5.375% due 01/18/2006 181,000 181,970 8.875% due 06/01/2009 200 242 7.375% due 01/15/2010 4,200 4,678 International Bank for Reconstruction & Development 7.000% due 01/27/2005 1,000 1,065 International Lease Finance Corp. 5.930% due 07/15/2003 14,000 14,172 J.P. Morgan & Co., Inc. 6.700% due 11/01/2007 30 31 6.655% due 02/15/2012 (d) 600 548 JET Equipment Trust 10.000% due 06/15/2012 80 92 10.690% due 05/01/2015 100 122 John Hancock 7.375% due 02/15/2024 360 351 KBC Bank Fund Trust III 9.860% due 11/29/2049 (d) 5,700 6,394 Key Bank USA NA 7.550% due 09/15/2006 350 370 Kimco Realty Corp. 6.500% due 10/01/2003 200 203 Korea Development Bank 7.125% due 09/17/2001 13,055 13,141 7.900% due 02/01/2002 300 304 8.600% due 03/25/2002 6,600 6,786 6.500% due 11/15/2002 440 444 6.750% due 12/01/2005 55 55 7.250% due 05/15/2006 50 51 LB Rheinland - PFALZ 5.000% due 02/23/2028 3,400 3,383 Lehman Brothers Holdings, Inc. 7.019% due 03/18/2002 (d) 10,000 10,000 6.375% due 05/07/2002 61,290 62,098 8.750% due 05/15/2002 219 227 6.186% due 07/08/2002 (d) 60,100 60,139 6.479% due 07/15/2002 (d) 43,651 43,945 7.125% due 07/15/2002 100 102 7.080% due 08/12/2002 (d) 6,500 6,489 7.450% due 08/28/2002 (d) 6,500 6,509 5.389% due 09/03/2002 (d) 14,000 14,003 5.610% due 12/12/2002 (d) 60,100 60,344 5.240% due 04/04/2003 (d) 132,550 132,747 7.625% due 06/01/2006 350 370 LG&E Capital Corp. 7.360% due 06/18/2001 (d) 400 400 6.205% due 05/01/2004 1,000 966 6.460% due 01/15/2008 3,000 2,714 Liberty Mutual Insurance 8.200% due 05/04/2007 17,510 18,272 Limestone Electron Trust 8.625% due 03/15/2003 71,350 74,521 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 87 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Lion Connecticut Holdings 6.375% due 08/15/2003 $ 200 $ 204 7.250% due 08/15/2023 50 48 Lloyds TSB Bank 5.745% due 08/26/2010 (d) 3,000 2,999 MBNA America Bank NA 7.010% due 04/25/2002 (d) 1,000 999 MBNA Corp. 5.610% due 08/07/2001 (d) 100 100 6.980% due 09/13/2001 (d) 10,300 10,310 MCN Investment Corp. 7.120% due 01/16/2004 7,500 7,614 6.300% due 04/02/2011 7,500 7,500 Merrill Lynch & Co. 6.500% due 04/01/2001 400 400 6.750% due 04/30/2001 2,775 2,778 8.000% due 02/01/2002 400 410 7.375% due 08/17/2002 300 310 8.300% due 11/01/2002 700 734 6.000% due 02/12/2003 500 509 6.875% due 03/01/2003 140 145 5.006% due 06/24/2003 (d) 27,000 26,992 6.550% due 08/01/2004 400 414 7.000% due 04/27/2008 100 104 Metropolitan Life Insurance Co. 6.300% due 11/01/2003 6,800 6,910 MIC Financing Trust I 8.375% due 02/01/2027 36,000 32,484 Monumental Global Funding II 6.910% due 09/26/2003 (d) 58,500 58,519 Morgan Stanley Group, Inc. 6.700% due 05/01/2001 600 601 9.375% due 06/15/2001 300 303 5.228% due 03/11/2003 (d) 11,500 11,500 6.375% due 12/15/2003 150 154 5.625% due 01/20/2004 1,200 1,206 Morgan Stanley, Dean Witter & Co. 6.948% due 04/15/2002 (d) 550 551 5.590% due 05/05/2003 (d) 43,000 43,088 6.964% due 08/07/2003 (d) 140,800 140,974 5.899% due 04/22/2004 (d) 108,500 108,622 Nacional Financiera 9.750% due 03/12/2002 10,000 10,365 7.284% due 05/08/2003 (d) 7,750 8,021 National Rural Utilities Cooperative Finance Corp. 6.880% due 05/31/2002 (d) 10,000 10,010 5.721% due 08/13/2002 (d) 12,000 12,003 6.250% due 04/15/2003 50,000 50,728 National Westminster Bank PLC 5.520% due 09/16/2002 (d) 12,275 12,317 9.375% due 11/15/2003 200 220 Newcourt Credit Group, Inc. 6.875% due 02/16/2005 7,500 7,712 Noble Affiliates, Inc. 8.950% due 12/15/2004 11,500 11,990 Nordbanken AB 7.250% due 11/12/2009 25,250 26,224 8.950% due 11/19/2049 4,000 4,389 Nordstrom Credit, Inc. 7.250% due 04/30/2002 1,000 1,026 Northern Rock PLC 2.000% due 01/01/2000 660 14,685 Okobank 7.040% due 05/23/2006 (d) 10,000 10,081 Old Kent Bank 6.275% due 11/01/2005 (d) 1,300 1,299 7.750% due 08/15/2010 19,500 20,517 Orix Credit Alliance, Inc. 6.785% due 04/16/2001 15,000 15,007 7.640% due 09/17/2001 13,000 13,163 Osprey Trust 8.310% due 01/15/2003 75,475 77,834 Pacific Life Insurance Co. 7.900% due 12/30/2023 8,000 8,097 Paine Webber Group, Inc. 7.030% due 05/20/2002 (d) 1,000 1,000 7.290% due 07/15/2002 (d) 200 201 Parker Retirement Savings Plan 6.340% due 07/15/2008 791 791 PDVSA Finance Ltd. 7.400% due 08/15/2016 1,200 966 Pemex Finance Ltd. 6.125% due 11/15/2003 17,111 17,007 PNC Bank NA 5.150% due 01/24/2002 (d) 49,000 49,030 PNC Funding Corp. 6.875% due 03/01/2003 100 103 7.000% due 09/01/2004 20,000 20,771 PNC Institutional Capital Trust A 7.950% due 12/15/2026 150 146 Popular North American, Inc. 6.875% due 06/15/2001 16,500 16,559 7.375% due 09/15/2001 25,000 25,263 Popular, Inc. 6.200% due 04/30/2001 3,336 3,338 6.540% due 11/06/2001 18,705 18,877 6.625% due 01/15/2004 19,500 19,804 Premium Asset Trust 7.076% due 11/27/2004 (d) 48,900 49,009 Prime Property Funding II 7.000% due 08/15/2004 110 112 Protective Life Funding Trust 6.089% due 01/17/2003 (d) 2,000 2,003 Prudential Funding Corp. 6.375% due 07/23/2006 100 101 6.625% due 04/01/2009 17,000 16,110 PSEG Capital Corp. 6.740% due 10/23/2001 1,400 1,414 Qwest Capital Funding, Inc. 6.875% due 08/15/2001 73,750 74,190 7.253% due 07/08/2002 (d) 18,000 18,024 Reliance Group Holdings, Inc. 9.000% due 11/15/2000 (e) 19,000 1,663 9.750% due 11/15/2003 (e) 10,000 288 Reliant Energy Financial Co. 7.660% due 12/10/2001 (d) 53,100 53,120 Rothmans Holdings 6.500% due 05/06/2003 16,390 16,561 Royal Bank of Scotland Group PLC 6.770% due 03/31/2049 126,500 115,896 8.817% due 03/31/2049 41,600 45,064 9.118% due 03/31/2049 66,400 75,622 Salomon, Inc. 6.650% due 07/15/2001 600 603 7.000% due 03/04/2002 18,850 19,236 6.750% due 02/15/2003 450 462 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 (i) 30,140 30,306 6.625% due 07/01/2002 55 56 6.125% due 01/15/2003 290 294 5.629% due 02/11/2003 (d) 44,200 44,264 5.848% due 04/28/2003 (d) 28,000 28,027 7.000% due 03/15/2004 100 104 Sears Roebuck Acceptance Corp. 6.800% due 05/07/2001 500 501 6.790% due 05/21/2001 500 501 7.190% due 06/18/2001 5,880 5,908 7.110% due 06/19/2001 1,000 1,005 6.860% due 07/03/2001 3,409 3,426 9.400% due 08/02/2001 250 253 6.860% due 08/06/2001 400 403 6.710% due 08/13/2001 80 80 6.600% due 10/09/2001 17,000 17,162 6.360% due 12/04/2001 290 293 6.120% due 12/13/2001 260 262 6.950% due 05/15/2002 300 305 6.000% due 03/20/2003 149,750 150,403 7.260% due 04/21/2003 3,000 3,104 7.140% due 05/02/2003 5,000 5,164 6.560% due 11/20/2003 1,178 1,204 88 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Seismic Ltd. 10.901% due 01/01/2002 (d) $ 32,500 $ 32,305 Simon Property Group, Inc. 9.000% due 03/15/2002 2,000 2,054 Socgen Real Estate LLC 7.640% due 12/29/2049 20,000 20,120 Spieker Properties, Inc. 6.800% due 12/15/2001 5,500 5,552 6.950% due 12/15/2002 1,600 1,632 6.800% due 05/01/2004 1,000 1,020 Steers 10.501% due 08/07/2002 (d) 20,000 20,388 Sumitomo Bank Treasury Co. 9.400% due 12/29/2049 (d) 6,750 6,510 Sun Life of Canada (U.S.) 8.526% due 05/29/2049 250 235 Telewest Credit Links 8.500% due 04/16/2004 25,000 21,459 Textron Financial Corp. 5.860% due 10/26/2001 (d) 11,200 11,219 7.099% due 05/28/2002 (d) 51,900 51,836 7.034% due 09/17/2002 (d) 2,000 2,004 The Money Store, Inc. 8.050% due 04/15/2002 300 309 7.300% due 12/01/2002 100 103 Tokai Capital Corp. 9.980% due 12/29/2049 (d) 9,735 8,120 Toyota Motor Credit Corp. 7.325% due 02/15/2002 (d) 40,000 40,068 Transamerica Finance Corp. 6.798% due 09/17/2001 (d) 12,000 12,000 6.125% due 11/01/2001 29,000 29,187 6.830% due 12/14/2001 (d) 64,300 64,320 5.920% due 03/29/2002 52,050 52,572 7.250% due 08/15/2002 86,195 88,243 7.500% due 03/15/2004 270 283 U.S. Bancorp 6.750% due 01/16/2002 (d) 49,000 49,024 5.755% due 02/03/2003 (d) 18,100 18,166 6.924% due 03/06/2003 600 602 6.500% due 06/15/2004 600 616 UBS Preferred Funding Trust I 8.622% due 10/29/2049 38,900 43,083 Wachovia Corp. 6.375% due 04/15/2003 200 204 6.075% due 05/02/2005 (d) 78,100 78,007 Washington Mutual Capital I 8.375% due 06/01/2027 235 225 Wells Fargo & Co. 8.750% due 05/01/2002 100 104 6.500% due 09/03/2002 100 102 6.625% due 07/15/2004 6,500 6,740 6.025% due 05/02/2005 (d) 77,300 77,235 Wells Fargo Financial, Inc. 6.375% due 07/16/2002 500 509 6.250% due 11/01/2002 100 102 7.000% due 01/15/2003 380 393 6.000% due 02/01/2004 50 51 10.875% due 04/15/2001 200 200 Westdeutsche Landesbank 6.750% due 06/15/2005 36,400 37,341 6.050% due 01/15/2009 164,600 162,284 ------------ 9,355,068 ------------ Industrials 7.0% AIC Corp. 6.965% due 10/02/2002 (d) 10,000 9,983 Air Products & Chemicals, Inc. 6.250% due 06/15/2003 2,500 2,533 Akzo Nobel, Inc. 6.000% due 11/15/2003 32,000 32,319 Allied Waste North America, Inc. 7.375% due 01/01/2004 18,925 18,641 Alpha Wind 11.321% due 05/23/2001 (d) 17,200 17,200 America West Airlines, Inc. 6.870% due 07/02/2018 1,820 1,739 American Airlines, Inc. 10.210% due 01/01/2010 6,500 7,188 10.610% due 03/04/2011 1,895 2,160 Amoco Corp. 6.250% due 10/15/2004 1,000 1,035 AMR Corp. 9.400% due 05/08/2001 3,000 3,005 9.430% due 05/10/2001 1,000 1,002 9.500% due 05/15/2001 6,480 6,495 9.130% due 10/25/2001 2,000 2,042 8.470% due 02/20/2002 2,000 2,036 8.500% due 02/26/2002 1,000 1,018 Anheuser-Busch Companies, Inc. 6.750% due 08/01/2003 500 524 Atlas Air, Inc. 9.504% due 10/04/2004 (d) 22,700 22,700 10.504% due 10/04/2004 (d) 3,000 3,000 Baxter International, Inc. 9.500% due 06/15/2008 200 237 Bayer Corp. 6.500% due 10/01/2002 250 255 Boeing Co. 6.350% due 06/15/2003 750 777 Boise Cascade Corp. 7.150% due 05/15/2001 10,000 10,005 Browning-Ferris Industries, Inc. 6.100% due 01/15/2003 (d) 6,000 5,844 Campbell Soup Co. 4.750% due 10/01/2003 700 690 Cargill, Inc. 6.871% due 01/14/2002 (d) 11,700 11,704 Cemex SA de CV 9.250% due 06/17/2002 5,000 5,144 8.625% due 07/18/2003 48,250 49,698 Champion International Corp. 9.700% due 05/01/2001 4,000 4,013 Clear Channel Communications, Inc. 7.210% due 06/15/2002 (d) 20,000 20,056 Coastal Corp. 5.554% due 03/06/2002 (d) 146,350 146,350 8.125% due 09/15/2002 250 258 Coca-Cola Enterprises, Inc. 6.375% due 08/01/2001 500 502 7.875% due 02/01/2002 100 103 6.000% due 07/15/2003 250 255 5.750% due 11/01/2008 100 99 Colgate-Palmolive Co. 6.000% due 08/15/2003 45 46 Comcast Cable Communications 8.375% due 05/01/2007 145 159 Continental Airlines, Inc. 6.410% due 04/15/2007 337 343 6.800% due 07/02/2007 25 25 6.954% due 02/02/2011 22,768 23,011 6.900% due 01/02/2018 1,468 1,499 Cox Communications, Inc. 7.000% due 08/15/2001 1,500 1,506 6.500% due 11/15/2002 200 202 Cox Enterprises, Inc. 6.625% due 06/14/2002 7,250 7,334 6.425% due 05/01/2033 (d) 500 500 CSX Corp. 7.260% due 06/24/2002 (d) 30,700 30,721 DaimlerChrysler North America Holding Corp. 6.630% due 09/21/2001 1,000 1,008 6.899% due 01/18/2002 (d) 41,000 40,802 7.125% due 03/01/2002 16,500 16,604 5.640% due 08/23/2002 (d) 15,400 15,272 5.790% due 12/16/2002 (d) 93,100 92,715 7.750% due 05/27/2003 45,000 46,563 5.720% due 08/16/2004 (d) 76,600 74,666 7.250% due 01/18/2006 40,000 41,055 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 89 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Delta Air Lines Equipment Trust 9.230% due 07/02/2002 (l) $ 1,956 $ 2,034 10.500% due 01/02/2007 (l) 7,372 8,536 10.570% due 01/02/2007 (l) 15,881 18,571 10.370% due 01/02/2007 (l) 9,629 10,978 9.550% due 01/02/2008 (l) 7,773 8,845 10.430% due 01/02/2011 1,810 1,949 10.140% due 08/14/2012 1,000 1,102 10.000% due 06/05/2013 10,828 11,446 Delta Air Lines, Inc. 6.650% due 03/15/2004 13,500 13,208 7.379% due 05/18/2010 8,200 8,704 9.200% due 09/23/2014 6,000 6,031 10.500% due 04/30/2016 6,050 6,935 Duty Free International, Inc. 7.000% due 01/15/2004 175 177 Eastman Chemical Co. 6.375% due 01/15/2004 5,750 5,608 Electric Lightwave, Inc. 6.050% due 05/15/2004 10,700 9,779 Eli Lilly & Co. 8.125% due 12/01/2001 500 511 6.250% due 03/15/2003 100 102 Enron Corp. 5.510% due 09/10/2001 (d) 35,000 35,029 6.450% due 11/15/2001 5,275 5,311 8.375% due 05/23/2005 12,000 13,010 Federal Express Corp. 6.845% due 01/15/2019 811 809 Ford Capital BV 9.375% due 05/15/2001 300 301 9.500% due 06/01/2010 200 229 Ford Motor Co. 9.000% due 09/15/2001 980 996 6.625% due 10/01/2028 115,800 102,927 7.450% due 07/16/2031 10,000 9,855 7.400% due 11/01/2046 2,380 2,234 Fortune Brands, Inc. 8.500% due 10/01/2003 500 535 Fred Meyer, Inc. 7.150% due 03/01/2003 13,000 13,480 7.375% due 03/01/2005 38,100 39,911 General Foods Corp. 6.000% due 06/15/2001 200 200 General Motors Corp. 9.125% due 07/15/2001 100 101 6.250% due 05/01/2005 300 303 Gillette Co. 6.250% due 08/15/2003 750 773 5.750% due 10/15/2005 1,500 1,520 Grupo Elektra SA 12.750% due 05/15/2001 1,000 1,005 Harrahs Operating Co., Inc. 7.875% due 12/15/2005 5,000 5,025 HCA - The Healthcare Co. 8.020% due 08/05/2002 9,000 9,201 8.049% due 09/19/2002 (d) 60,500 60,497 8.130% due 08/04/2003 7,300 7,568 6.910% due 06/15/2005 9,500 9,352 6.630% due 07/15/2045 10,000 10,101 6.730% due 07/15/2045 22,560 22,797 Heinz (H.J.) Co. 6.875% due 01/15/2003 100 103 Hilton Hotels Corp. 7.375% due 06/01/2002 1,000 1,009 HNA Holdings, Inc. 6.125% due 02/01/2004 200 207 Houghton Mifflin Co. 5.990% due 12/03/2001 3,000 3,012 IBM Corp. 7.250% due 11/01/2002 625 645 ICI Wilmington, Inc. 6.750% due 09/15/2002 10,000 10,119 IMEXSA Export Trust 10.125% due 05/31/2003 7,091 6,907 Imperial Tobacco Overseas BV 7.125% due 04/01/2009 21,785 21,378 International Game Technology 7.875% due 05/15/2004 14,500 14,718 International Paper Co. 7.000% due 06/01/2001 2,000 2,005 6.666% due 07/08/2002 (d) 48,600 48,657 Kroger Co. 6.340% due 06/01/2001 50,924 50,984 Lockheed Martin Corp. 6.850% due 05/15/2001 89,064 89,188 Mandalay Resort Group 6.750% due 07/15/2003 4,500 4,354 Martin Marietta Corp. 6.500% due 04/15/2003 50 51 Mazda Manufacturing Corp. 10.500% due 07/01/2008 (l) 1,980 2,510 Nabisco, Inc. 6.800% due 09/01/2001 3,000 3,006 6.700% due 06/15/2002 9,000 9,045 6.125% due 02/01/2033 15,000 15,079 News America Holdings, Inc. 8.625% due 02/01/2003 750 786 Norfolk Southern Corp. 6.950% due 05/01/2002 12,000 12,196 7.875% due 02/15/2004 50 53 Northwest Airlines, Inc. 8.970% due 01/02/2015 1,576 1,684 8.072% due 10/01/2019 400 437 Occidental Petroleum Corp. 6.400% due 04/01/2003 17,710 17,834 Park Place Entertainment Corp. 7.950% due 08/01/2003 18,500 19,009 Petroleos Mexicanos 7.769% due 07/15/2005 (d) 32,250 32,331 7.845% due 07/15/2005 (d) 94,000 94,235 8.850% due 09/15/2007 1,800 1,852 9.375% due 12/02/2008 39,650 41,335 9.500% due 09/15/2027 31,000 32,473 Philip Morris Cos., Inc. 8.750% due 06/01/2001 7,735 7,775 6.000% due 07/15/2001 1,000 999 7.250% due 09/15/2001 3,770 3,797 7.500% due 01/15/2002 50 51 7.625% due 05/15/2002 8,300 8,475 6.800% due 12/01/2003 48,345 49,880 7.000% due 07/15/2005 15,125 15,646 6.950% due 06/01/2006 9,540 9,552 7.200% due 02/01/2007 34,000 35,278 Phillips Petroleum Co. 9.000% due 06/01/2001 2,000 2,010 Premium Asset Trust 7.029% due 09/08/2007 25,000 24,938 Procter & Gamble Co. 5.250% due 09/15/2003 35,900 36,220 Racers 6.930% due 03/03/2003 (d) 282,400 282,549 6.209% due 04/01/2003 (d) 20,000 19,956 8.760% due 04/28/2003 (d) 30,000 30,735 6.800% due 09/15/2005 (d) 15,000 14,967 Raytheon Co. 5.739% due 08/10/2001 (d) 74,100 74,186 7.310% due 03/01/2002 (d) 8,650 8,656 Rollins Truck Leasing Co. 8.250% due 05/01/2002 13,400 13,762 Saferco 9.590% due 05/31/2001 3,000 3,021 Safeway, Inc. 7.000% due 09/15/2002 1,125 1,146 6.850% due 09/15/2004 250 260 Sara Lee Corp. 6.300% due 11/07/2005 500 511 Scotia Pacific Co. LLC 7.710% due 01/20/2014 (d) 305 224 90 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Sears, Roebuck & Co. 8.390% due 02/14/2002 $ 240 $ 245 6.250% due 01/15/2004 300 301 SmithKline Beecham Corp. 7.375% due 04/15/2005 150 160 Sun Microsystems, Inc. 7.000% due 08/15/2002 200 202 TCI Communications, Inc. 7.176% due 04/03/2002 (d) 11,600 11,664 5.580% due 03/11/2003 (d) 5,000 5,030 6.375% due 05/01/2003 3,280 3,311 8.650% due 09/15/2004 625 672 8.000% due 08/01/2005 450 478 Tele-Communications, Inc. 8.250% due 01/15/2003 43,125 45,078 Tenet Healthcare Corp. 7.875% due 01/15/2003 10,300 10,519 8.625% due 12/01/2003 6,200 6,441 Texaco Capital, Inc. 8.500% due 02/15/2003 700 745 6.000% due 06/15/2005 400 409 Textron, Inc. 6.750% due 09/15/2002 225 229 Time Warner, Inc. 6.100% due 12/30/2001 41,875 42,043 7.975% due 08/15/2004 19,770 21,087 Times Mirror Co. 6.650% due 10/15/2001 300 303 TRW, Inc. 6.450% due 06/15/2001 31,135 31,102 6.625% due 06/01/2004 8,925 8,856 Tyco International Group SA 6.125% due 06/15/2001 5,600 5,605 6.875% due 09/05/2002 675 685 Union Pacific Corp. 7.875% due 02/15/2002 8,000 8,156 7.365% due 07/01/2002 (d) 25,500 25,543 6.930% due 06/01/2003 1,000 1,030 6.000% due 09/01/2003 8,000 8,000 6.120% due 02/01/2004 250 249 Unisys Corp. 9.210% due 01/21/2017 2,000 2,114 United Air Lines, Inc. 9.200% due 03/22/2008 3,950 4,311 10.360% due 11/13/2012 7,000 7,826 10.020% due 03/22/2014 6,925 7,490 10.850% due 07/05/2014 34,111 39,667 10.850% due 02/19/2015 1,500 1,725 10.125% due 03/22/2015 14,300 15,651 9.060% due 06/17/2015 5,000 5,095 United Technologies Corp. 7.125% due 11/15/2010 450 486 US Airways, Inc. 6.850% due 01/30/2018 143 138 UST, Inc. 7.250% due 06/01/2009 15,000 14,278 USX Corp. 9.800% due 07/01/2001 24,050 24,294 Wal-Mart Stores, Inc. 8.625% due 04/01/2001 2,450 2,450 6.150% due 08/10/2001 450 452 6.750% due 05/24/2002 170 173 6.500% due 06/01/2003 200 207 Walt Disney Co. 5.125% due 12/15/2003 500 499 Waste Management, Inc. 6.700% due 05/01/2001 10,000 10,002 6.000% due 05/15/2001 28,800 28,762 6.125% due 07/15/2001 23,900 23,857 6.375% due 12/01/2003 200 200 6.500% due 05/15/2004 94,000 94,015 Witco Corp. 6.600% due 04/01/2003 100 99 Yorkshire Power 6.154% due 02/25/2003 17,000 17,008 ------------ 2,972,965 ------------ Utilities 5.9% Alabama Power Co. 5.350% due 11/15/2003 1,600 1,590 Allete 6.499% due 10/20/2003 (d) 79,700 79,786 Appalachian Power Co. 7.270% due 06/27/2001 (d) 20,000 20,006 Arizona Public Service Co. 6.109% due 11/15/2001 (d) 14,000 14,015 Ashland, Inc. 8.450% due 12/05/2001 3,000 3,069 7.253% due 03/07/2003 (d) 300 300 AT&T Canada, Inc. 0.000% due 11/01/2007 1,000 899 0.000% due 06/15/2008 14,630 12,178 AT&T Corp. 5.125% due 04/01/2001 600 600 7.350% due 08/27/2001 7,200 7,258 7.125% due 01/15/2002 275 278 Baltimore Gas & Electric 6.125% due 07/01/2003 150 153 Bell Atlantic Maryland, Inc. 8.000% due 10/15/2029 1,125 1,217 Bell Atlantic Virginia, Inc. 5.625% due 03/01/2007 500 486 BellSouth Telecommunications, Inc. 6.000% due 06/15/2002 10,000 10,119 6.250% due 05/15/2003 100 102 British Telecommunications PLC 6.079% due 12/15/2003 (d) 94,800 94,839 7.625% due 12/15/2005 5,000 5,179 8.125% due 12/15/2010 (d) 83,000 86,717 Calpine Corp. 9.250% due 02/01/2004 4,150 4,152 CE Electric Funding 6.853% due 12/30/2004 250 252 Central Maine Power Co. 7.430% due 08/25/2003 13,000 13,552 Central Power & Light Co. 7.351% due 11/23/2001 (d) 18,100 18,121 Cleveland Electric Illuminating Co. 9.500% due 05/15/2005 33,000 34,158 CMS Energy Corp. 8.375% due 07/01/2003 15,000 15,276 7.000% due 01/15/2005 41,325 39,637 8.000% due 07/01/2011 1,000 1,002 Columbia Energy Group 6.610% due 11/28/2002 5,000 5,094 Columbus Southern Power Co. 6.850% due 10/03/2005 10,000 10,299 Commonwealth Edison Co. 6.625% due 07/15/2003 1,000 1,025 7.145% due 09/30/2003 (d) 17,700 17,706 9.875% due 06/15/2020 11,700 13,213 Connecticut Light & Power Co. 7.875% due 06/01/2001 5,100 5,119 7.750% due 06/01/2002 5,000 5,116 8.590% due 06/05/2003 27,000 29,085 Consolidated Edison, Inc. 6.625% due 02/01/2002 100 101 6.720% due 06/15/2002 (d) 11,000 11,014 6.375% due 04/01/2003 1,000 1,018 Consolidated Natural Gas Co. 7.250% due 10/01/2004 43,750 45,631 Constellation Energy Group 7.219% due 04/04/2003 (d) 15,000 14,971 Detroit Edison Co. 7.210% due 08/01/2002 1,000 1,029 6.341% due 07/15/2028 1,000 993 Dominion Resources, Inc. 7.600% due 07/15/2003 35,000 36,440 DTE Capital Corp. 8.350% due 11/15/2038 (d) 90,250 92,148 Duke Energy Corp. 5.875% due 06/01/2001 375 375 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 91 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- El Paso Electric Co. 9.400% due 05/01/2011 $ 7,455 $ 8,269 El Paso Energy Corp. 6.625% due 07/15/2001 27,000 27,119 El Paso Natural Gas Co. 7.750% due 01/15/2002 15,000 15,264 Entergy Arkansas, Inc. 7.000% due 03/01/2002 3,580 3,620 7.720% due 03/01/2003 200 207 Entergy Gulf States, Inc. 6.410% due 08/01/2001 5,800 5,819 Entergy Louisiana, Inc. 7.740% due 07/01/2002 599 600 8.500% due 06/01/2003 3,000 3,162 Entergy Mississippi, Inc. 7.409% due 05/03/2004 (d) 31,000 31,008 Exelon Corp. 5.625% due 11/01/2001 22,350 22,419 Florida Power & Light 6.875% due 12/01/2005 4,000 4,191 France Telecom 6.308% due 03/14/2003 (d) 83,200 83,246 Georgia Power Co. 5.620% due 02/22/2002 (d) 15,000 15,004 Global Crossing Ltd. 8.950% due 08/07/2001 3,000 3,040 GTE California, Inc. 5.500% due 01/15/2009 100 95 GTE South, Inc. 7.250% due 08/01/2002 150 154 Houston Lighting & Power Co. 8.750% due 03/01/2022 10,000 10,496 Indiana Bell Telephone Co., Inc. 5.500% due 04/01/2007 500 479 Indiana Michigan Power Co. 7.305% due 09/03/2002 (d) 5,000 5,004 Indianapolis Power & Light Co. 7.375% due 08/01/2007 225 237 Kinder Morgan, Inc. 6.450% due 11/30/2001 10,000 10,052 6.450% due 03/01/2003 240 243 Korea Electric Power Corp. 7.000% due 10/01/2002 380 385 6.375% due 12/01/2003 220 221 Marlin Water Trust 7.090% due 12/15/2001 11,238 11,337 Mirant Corp. 7.900% due 07/15/2009 175 174 Montana Power Co. 7.053% due 04/06/2001 (d) 15,000 15,008 National Power Corp. 9.625% due 05/15/2028 16,000 11,131 Nevada Power Co. 5.990% due 08/20/2001 (d) 1,200 1,201 6.200% due 04/15/2004 20,000 19,596 New England Telephone & Telegraph Co. 6.250% due 03/15/2003 50 51 6.375% due 09/01/2008 1,350 1,316 New York Telephone Co. 6.250% due 02/15/2004 150 153 6.000% due 04/15/2008 45 45 Niagara Mohawk Power Co. 7.125% due 07/01/2001 34,644 34,786 7.250% due 10/01/2002 24,783 25,309 7.375% due 07/01/2003 39,162 40,170 7.375% due 08/01/2003 1,645 1,709 NorAm Energy Corp. 8.920% due 05/15/2001 7,000 7,026 6.375% due 11/01/2003 22,250 22,726 Nortel Networks Corp. 8.750% due 06/12/2001 300 302 6.875% due 10/01/2002 200 204 Northern Illinois Gas Co. 6.450% due 08/01/2001 1,450 1,454 NRG Energy, Inc. 8.000% due 11/01/2003 6,000 6,185 NRG Northeast Generating LLC 8.065% due 12/15/2004 422 435 Ohio Bell Telephone Co. 5.375% due 03/01/2007 950 906 Ohio Power Co. 7.000% due 07/01/2004 24,000 24,642 Oneok, Inc. 7.390% due 04/24/2002 (d) 8,000 8,014 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d) 33,700 27,803 5.875% due 10/01/2005 100 85 7.375% due 11/01/2005 22,000 16,830 7.250% due 08/01/2026 10,000 8,350 Pacific Northwest Bell Telephone 4.375% due 09/01/2002 50 49 Portland General Electric Co. 7.660% due 01/14/2002 5,000 5,103 PP&L, Inc. 6.125% due 05/01/2001 (d) 16,102 16,110 6.550% due 03/01/2006 500 510 PSEG Energy Holdings, Inc. 9.125% due 02/10/2004 120 124 Public Service Co. of Colorado 6.000% due 04/15/2003 750 759 Public Service Electric & Gas Co. 7.250% due 04/01/2001 (d) 3,191 3,191 6.125% due 08/01/2002 1,000 1,010 6.250% due 01/01/2007 1,500 1,505 Public Service Enterprise Group, Inc. 7.035% due 06/15/2001 (d) 156,200 156,327 Queststar Pipeline Co. 9.375% due 06/01/2021 200 210 RAS LAFFAN Liquid Natural Gas 8.294% due 03/15/2014 145 145 Reliant Energy, Inc. 9.375% due 06/01/2001 2,000 2,008 Scana Corp. 5.910% due 02/08/2002 (d) 13,900 13,918 6.329% due 07/15/2002 (d) 38,800 38,871 Sierra Pacific Power Co. 7.160% due 06/12/2001 (d) 46,000 46,000 Sierra Pacific Resources 6.299% due 04/20/2002 (d) 500 425 6.249% due 04/20/2003 (d) 2,000 1,700 Sonat, Inc. 9.000% due 05/01/2001 100 100 Southern California Edison Co. 6.500% due 06/01/2001 200 167 7.204% due 05/01/2002 (d) 24,000 19,560 Sprint Capital Corp. 9.500% due 06/06/2001 150 151 5.679% due 11/15/2001 (d) 144,900 145,094 6.500% due 11/15/2001 14,365 14,472 7.010% due 06/10/2002 (d) 14,400 14,422 7.625% due 06/10/2002 7,000 7,177 6.850% due 06/24/2002 (d) 62,500 62,562 8.125% due 07/15/2002 10,378 10,652 System Energy Resources, Inc. 7.710% due 08/01/2001 5,800 5,843 TECO Energy, Inc. 5.540% due 09/15/2001 44,630 44,796 Telekomunikacja Polska SA 7.125% due 12/10/2003 12,200 12,250 7.750% due 12/10/2008 7,895 7,663 Tennessee Valley Authority 0.000% due 04/15/2042 855 410 Texas Utilities Corp. 5.420% due 06/25/2001 (d) 173,900 173,875 6.370% due 08/16/2001 1,000 1,004 7.389% due 09/24/2001 (d) 160,100 158,574 5.940% due 10/15/2001 3,000 3,014 6.500% due 08/16/2002 2,600 2,635 6.750% due 03/01/2003 150 153 92 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Toledo Edison Co. 8.180% due 07/30/2002 $ 1,400 $ 1,440 8.700% due 09/01/2002 24,500 25,208 7.850% due 03/31/2003 7,000 7,226 7.875% due 08/01/2004 500 531 Transcontinental Gas Pipe Corp. 7.080% due 07/15/2026 15,000 15,055 TXU Eastern Funding Co. 6.150% due 05/15/2002 61,800 62,109 6.450% due 05/15/2005 15,270 15,218 Union Electric Co. 8.000% due 12/15/2022 1,000 1,022 Vodafone Group PLC 6.736% due 12/19/2001 (d) 23,900 23,940 7.750% due 02/15/2010 500 540 Western Massachusetts Electric Co. 7.375% due 07/01/2001 23,235 23,303 Williams Cos., Inc. 5.889% due 11/15/2001 (d) 26,800 26,839 6.200% due 08/01/2002 5,000 5,032 Wilmington Trust Co. - Tucson Electric 10.732% due 01/01/2013 (l) 991 1,094 WorldCom, Inc. 6.125% due 08/15/2001 3,030 3,035 6.981% due 11/26/2001 (d) 22,100 22,037 8.875% due 01/15/2006 3,000 3,099 6.125% due 04/15/2012 1,250 1,252 ----------- 2,503,119 ----------- Total Corporate Bonds & Notes 14,831,152 (Cost $14,798,070) ----------- -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 1.0% -------------------------------------------------------------------------------- Alabama 0.0% Jefferson County, Alabama Sewer Revenue Warrants, (FGIC Insured), Series 2001 5.000% due 02/01/2041 5,000 4,694 Jefferson County, AIabama Sewer Revenue Bonds Warrants, (FGIC Insured), Series 2000-323 6.560% due 02/01/2029 (d) 4,500 4,337 Jefferson County, AIabama Sewer Revenue Bonds Warrants, (FGIC Insured), Series 2000-352 5.912% due 02/01/2036 (d) 625 573 Jefferson County, Alabama Sewer Revenue Bonds, (FGIC Insured), Series 2001 6.940% due 02/01/2039 5,500 5,170 Montgomery Alabama Special Care Facilities Financing Authority Revenue Bonds, (MBIA Insured), Series 2000 5.410% due 11/15/2029 1,000 890 ----------- 15,664 ----------- California 0.1% California State Department of Water Resources Center Valley Project Revenue Bonds, Series 2000 6.030% due 12/01/2029 2,500 2,378 California State General Obligation Bonds, Series 2000 7.290% due 05/01/2026 2,635 2,875 Fairfield California Redevelopment Agency Tax Allocation, Series 1997 7.700% due 06/01/2002 10 10 Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, Series 1995 0.000% due 01/01/2026 9,000 2,449 0.000% due 01/01/2030 3,590 785 Los Angeles County Metropolitan Transportation Authority Sales Tax Revenue Bonds, (AMBAC Insured), Series 2000 5.740% due 07/01/2023 3,500 3,434 Los Angeles, California Wastewater System Revenue Bonds, (FGIC Insured), Series 2000 6.700% due 06/01/2028 6,500 6,313 Modesto California Financing Authority Revenue, (AMBAC Insured), Series 1998 5.000% due 09/01/2029 300 295 Orange County School Board, (MBIA Insured), Series 2000 5.710% due 08/01/2024 3,500 3,360 Port of Oakland, California Revenue Bonds, (FGIC Insured), Series 2000 5.750% due 11/01/2029 1,000 1,054 San Diego Public Facilities Financing Authority Revenue Bonds, (FGIC Insured), Series 1999 5.000% due 05/15/2029 1,000 984 San Francisco, California City & County Common International Airport Revenue Bonds, (MBIA Insured), Series 2000 4.840% due 05/01/2028 3,350 2,680 ----------- 26,617 ----------- Colorado 0.0% Denver Colorado City & County Airport Revenue Bonds, Series 2000 5.980% due 11/15/2025 2,500 2,356 E-470 Public Highway Authority Revenue Bonds, (MBIA Insured), Series 2000 5.750% due 09/01/2035 2,500 2,659 ----------- 5,015 ----------- Florida 0.1% Broward County Florida Airport System Revenue, (AMBAC Insured), Series 2000 5.030% due 10/01/2023 1,328 1,176 Florida State Board of Education General Obligation, (FGIC Insured), Series 2000 4.710% due 06/01/2023 3,500 2,835 Florida State Governmental Utility Authority Utility Revenue, (AMBAC Insured), Series 2000 5.710% due 10/01/2029 6,453 6,073 Florida State Turnpike Authority Revenue Bonds, (FGIC Insured), Series 2000 4.440% due 07/01/2027 6,323 4,932 Greater Orlando Aviation Authority, Orlando Florida Airport Facitities Revenue Bonds, (FGIC Insured), Series 1999 5.125% due 10/01/2028 2,000 1,940 Lakeland Florida Electric & Water Revenue Bonds, (MBIA Insured), Series 2000 5.000% due 10/01/2028 2,675 2,528 Modesto Public Financing Authority Lease Revenue, (AMBAC Insured), Series 2000 5.740% due 09/01/2029 2,500 2,419 Tampa, Florida Guaranteed Entitlement Revenue, (AMBAC Insured), Series 2001 6.000% due 10/01/2005 2,230 2,433 Tampa, Florida Utility Tax & Special Revenue, (AMBAC Insured), Series 2001 6.000% due 10/01/2005 3,000 3,278 6.000% due 10/01/2008 1,500 1,682 ----------- 29,296 ----------- Georgia 0.1% Atlanta, Georgia Airport Revenue, (FGIC Insured), Series 2000 5.500% due 01/01/2026 1,000 1,035 Atlanta, Georgia Water & Wastewater Revenue Bonds, (FGIC Insured), Series 2000 5.440% due 11/01/2038 22,300 20,405 Georgia Local Government Certificate Of Participation, (MBIA Insured), Series 2000 5.810% due 06/01/2028 9,950 8,706 ----------- 30,146 ----------- Hawaii 0.0% Honolulu Hawaii City & County Wastewater System Revenue Bonds, (FGIC Insured), Series 2000 5.290% due 07/01/2023 3,468 3,259 5.210% due 07/01/2028 7,200 6,048 ----------- 9,307 ----------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 93 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Illinois 0.1% Chicago, IIlinois Skyway Toll Bridge Revenue Bonds, (AMBAC Insured), Series 2000 5.500% due 01/01/2031 $ 2,000 $ 2,045 Chicago, Illinois Board Education General Obligation, (FGIC Insured), Series 1998 0.000% due 12/01/2027 15,000 3,525 Chicago, Illinois General Obligations, (FGIC Insured), Series 2000 5.500% due 01/01/2035 2,500 2,550 5.500% due 01/01/2040 3,000 3,049 6.980% due 01/01/2040 4,750 4,904 Chicago, Illinois Midway Airport Revenue Bonds, (MBIA Insured), Series 1998 5.000% due 01/01/2035 7,000 6,641 Chicago, Illinois Residual General Obligation, (MBIA Insured), Series 2000 5.960% due 01/01/2028 3,100 2,945 Chicago, Illinois Sales Tax Revenue Bonds, (FGIC Insured), Series 1999 5.375% due 01/01/2030 15,000 15,098 Cook County Illinois General Obligation, (FGIC Insured), Series 2000 5.000% due 11/15/2028 3,220 2,942 Cook County Illinois General Obligation, (FGIC Insured), Series 2001 6.690% due 11/15/2028 3 2 ----------- 43,701 ----------- Kansas 0.0% Wichita, Kansas Hospital Revenue Bonds, Series 1999 6.250% due 11/15/2024 1,000 1,054 ----------- Massachusetts 0.2% Boston Massachussetts Water & Sewer Common Revenue Bonds, (FGIC Insured), Series 2000 5.510% due 11/01/2028 3,500 3,255 E-470 Public Highway Residual 144a Revenue Bonds, (MBIA Insured), Series 2000 5.710% due 09/01/2021 2,590 2,545 Massachusetts Bay Transportation Authority Revenue Bonds, (MBIA Insured), Series 2000 5.260% due 03/01/2021 4,150 3,709 Massachusetts State Turnpike Authority Metro Highway System Revenue Bonds, (MBIA Insured), Series 1997 5.000% due 01/01/2037 6,000 5,648 Massachusetts State Turnpike Authority Revenue Bonds, (AMBAC Insured), Series 2000 5.910% due 01/01/2039 10,250 9,084 Massachusetts State Turnpike Authority Revenue Bonds, (MBIA Insured), Series 2000 7.960% due 01/01/2037 21,050 19,603 Southbridge Associations Limited Liability Corporation Massachussetts, (MBIA-Insured), Series 2000 7.590% due 02/01/2022 31,105 32,621 ----------- 76,465 ----------- Minnesota 0.0% Minnesota Agricultural & Economic Development Board Revenue Bonds, Series 2000 6.375% due 11/15/2029 1,000 1,055 ----------- Mississippi 0.0% Mississippi Development Bank Special Obligation, (AMBAC Insured), Series 2000 5.810% due 07/01/2024 2,500 2,400 ----------- Nevada 0.1% Clark County Nevada General Obligations, (MBIA Insured), Series 2000 8.440% due 07/01/2030 20,913 21,801 Clark County Passenger Facility Charge Revenue, (MBIA Insured), Series 2000 5.210% due 07/01/2022 4,750 4,192 ----------- 25,993 ----------- New Jersey 0.0% Essex County New Jersey Important Authority Lease Revenue Bonds, (FGIC Insured), Series 2000 7.090% due 10/01/2030 250 280 Mercer County New Jersey Important Authority Revenue Bonds, Series 2000 7.140% due 01/01/2018 3,103 3,669 New Jersey Health Care Facilities Financing Authority Revenue Bonds, (MBIA Insured), Series 2000 5.130% due 07/01/2028 2,000 1,740 ----------- 5,689 ----------- New York 0.2% Long Island Power Authority New York Electric System Revenue Bonds, (FSA Insured), Series 2001 7.040% due 12/01/2022 4,000 4,000 Long Island Power Authority Revenue Bonds, (FSA Insured), Series 2000 6.160% due 12/01/2022 4,500 4,410 Long Island Power Authority Revenue Bonds, (MBIA Insured), Series 2000 6.410% due 12/01/2026 5,500 5,548 New York City Municipal Bond, Series 1997 7.001% due 08/01/2002 (d) 6,108 6,108 New York City Municipal Water Finance Authority, (MBIA-IBC Insured), Series 2000 5.130% due 06/15/2025 6,565 5,654 New York City Transitional Finance Authority Revenue Bonds, Series 1998 4.750% due 05/01/2023 6,000 5,610 New York City, New York General Obligation, Series 1997-D 6.899% due 08/01/2002 (d) 9,040 9,040 New York City, New York Municipal Water Financial Authority Water & Sewer System Revenue Bonds, (FSA Insured), Series 2000 5.510% due 06/15/2029 3,000 2,839 New York City, New York Transitional Financial Authority Revenue Bonds, Series 2000 6.510% due 11/01/2024 1,250 1,203 New York City, New York Transitional Financing Authority Revenue Bonds, (FGIC-TCRS Insured), Series 2000 4.790% due 11/15/2023 2,500 2,191 New York State Dormitory Authority Lease Revenue Bonds, (FSA Insured), Series 1998 4.750% due 01/15/2029 7,300 6,709 New York State Dormitory Authority Revenue Bonds, (MBIA Insured), Series 2000 5.000% due 02/15/2023 2,550 2,352 Niagara Frontier Airport Revenue Bonds, (MBIA Insured), Series 1999 5.625% due 04/01/2029 1,000 1,024 Port Authority New York & New Jersey Special Obligation Revenue Bonds, (MBIA Insured), Series 2000 7.600% due 12/01/2022 3,250 3,575 Westchester County New York Health Care Corp. Revenue, Series 2000 5.875% due 11/02/2025 2,875 2,965 ----------- 63,228 ----------- North Dakota 0.0% Mercer County Improvement Authority Revenue Bonds, Series 1978 5.800% due 01/01/2018 55 60 ----------- Ohio 0.0% Hamilton County Ohio Sales Tax Revenue Bonds, (MBIA Insured), Series 2000 5.460% due 12/01/2027 3,250 3,092 ----------- 94 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Pennsylvania 0.0% Allegheny County Hospital Development Authority Revenue Bonds, (MBIA Insured), Series 2000 A 6.500% due 11/15/2030 $ 1,000 $ 1,103 Philadelphia School District General Obligation, (MBIA Insured), Series 2000 5.210% due 04/01/2027 3,150 2,705 Pittsburgh & Allegheny County Revenue Bonds, (AMBAC Insured), Series 1999 5.000% due 02/01/2029 500 484 ----------- 4,292 ----------- Puerto Rico 0.0% Puerto Rico Commonwealth General Obligation, (MBIA Insured), Series 2000 5.750% due 07/01/2026 3,990 4,269 Puerto Rico Commonwealth Highway & Transiton Authority Transition Revenue Bonds, (MBIA Insured), Series 2000 5.875% due 07/01/2035 4,930 5,349 ----------- 9,618 ----------- Texas 0.1% Dallas-Fort Worth International Airport Revenue, (FGIC Insured), Series 2000 6.000% due 11/01/2028 4,000 4,220 Denton County, Texas Utility System Revenue Bonds, (MBIA Insured), Series 2000 5.680% due 12/01/2029 3,000 2,876 Grapevine-Colleyville Independent General Obligation, (PSF-GTD Insured), Series 2000 6.000% due 08/15/2029 10,500 8,584 Harris County Health Facilities Development Corporation Revenue, (MBIA Insured), Series 2000 6.140% due 07/01/2021 3,500 3,395 Houston Independent School District General Obligation, (PSF Insured), Series 1999 4.750% due 02/15/2026 15,000 13,725 Houston, Texas Airport System Revenue Bonds, (FGIC Insured), Series 2000 5.290% due 07/01/2025 2,750 2,585 Houston, Texas Airport System Revenue Bonds, (FGIC Insured), Series 2001 5.000% due 07/01/2028 10,000 8,975 Houston, Texas Independent School District (PSF-GTD Insured), Series 2000 4.790% due 02/15/2026 15,088 12,541 Houston, Texas Water & Sewer System Revenue, (FGIC Insured), Series 2000 5.250% due 12/01/2030 1,000 998 North Texas Towey Authority Dallas North Towey System Revenue Bonds, (FGIC Insured), Series 1998 4.750% due 01/01/2029 4,000 3,675 ----------- 61,574 ----------- Utah 0.0% Weber County, Utah Hospital Revenue Bonds, Series 1999 5.000% due 08/15/2030 500 462 ----------- Washington State 0.0% Seattle Washington General Obligation, Series 2000 5.960% due 12/15/2028 3,000 2,925 ----------- Washington, DC 0.0% Washington D.C. Convention Center Authority Dedicated Tax Revenue, (AMBAC Insured), Series 2000 5.030% due 10/01/2028 6,500 5,363 ----------- Total Municipal Bonds & Notes 423,016 (Cost $385,483) ----------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 1.1% -------------------------------------------------------------------------------- A.I.D. Housing Guarantee - Peru 9.980% due 08/01/2008 825 846 Fannie Mae 6.590% due 05/24/2001 500 501 0.000% due 08/15/2001 105 103 6.100% due 09/14/2001 100 101 5.375% due 03/15/2002 750 756 6.500% due 09/05/2002 325 325 6.250% due 11/15/2002 385 395 5.250% due 01/15/2003 250 253 6.030% due 05/15/2003 9,950 9,968 4.750% due 11/14/2003 250 250 5.500% due 12/29/2003 500 508 5.125% due 02/13/2004 4,594 4,648 5.625% due 05/14/2004 1,525 1,558 5.750% due 06/15/2005 900 919 6.625% due 10/15/2007 650 692 6.560% due 12/10/2007 190 195 5.750% due 02/15/2008 400 406 6.000% due 05/15/2008 2,950 3,035 5.250% due 01/15/2009 80 78 5.870% due 01/28/2009 200 198 6.375% due 06/15/2009 2,070 2,168 6.625% due 09/15/2009 1,000 1,062 7.250% due 01/15/2010 2,930 3,238 7.125% due 06/15/2010 60,500 66,580 6.875% due 09/10/2012 1,000 1,050 6.930% due 09/17/2012 1,000 1,057 6.875% due 09/24/2012 2,000 2,109 6.250% due 05/15/2029 2,340 2,344 7.125% due 01/15/2030 325 362 7.250% due 05/15/2030 42 48 Federal Farm Credit Bank 6.400% due 01/16/2002 100 101 5.730% due 03/28/2003 300 306 6.050% due 12/07/2005 200 207 6.060% due 05/28/2013 100 101 Federal Home Loan Bank 6.500% due 04/26/2001 65 65 6.690% due 05/16/2001 400 401 4.875% due 01/22/2002 115 115 5.805% due 02/15/2002 (d) 17,000 17,080 6.210% due 12/30/2002 200 205 5.125% due 09/15/2003 350 354 5.135% due 09/22/2003 600 604 7.350% due 10/06/2003 42,500 42,513 6.000% due 06/30/2004 1,000 1,032 7.360% due 07/01/2004 500 537 6.250% due 08/13/2004 250 260 5.890% due 06/30/2008 1,000 1,021 5.800% due 09/02/2008 2,000 2,024 6.026% due 01/22/2009 275 273 0.000% due 09/29/2017 2,000 551 0.000% due 09/10/2018 15,000 4,473 0.000% due 12/21/2018 4,250 1,293 Freddie Mac 5.750% due 06/15/2001 668 670 5.500% due 05/15/2002 435 440 7.000% due 02/15/2003 500 521 7.375% due 05/15/2003 3,500 3,692 5.750% due 07/15/2003 350 358 6.250% due 07/15/2004 250 260 6.875% due 01/15/2005 495 525 7.440% due 09/20/2006 1,500 1,520 6.765% due 03/12/2007 400 428 5.750% due 04/15/2008 400 406 9.000% due 09/15/2008 18 19 5.750% due 03/15/2009 1,955 1,968 10.250% due 03/15/2009 8 9 6.625% due 09/15/2009 1,985 2,107 6.750% due 06/03/2013 400 398 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 95 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SallieMae 5.979% due 10/25/2004 (d) $ 17,299 $ 17,291 6.896% due 10/25/2004 (d) 11,644 11,632 7.115% due 07/25/2006 (d) 0 0 Small Business Administration 7.449% due 08/01/2010 122,044 128,782 7.700% due 07/01/2016 699 739 6.950% due 11/01/2016 4,149 4,270 6.700% due 12/01/2016 15,898 16,196 7.150% due 03/01/2017 7,636 7,918 7.190% due 12/01/2019 486 505 7.630% due 06/01/2020 23,668 25,069 6.900% due 12/01/2020 10,000 10,186 6.340% due 03/01/2021 33,416 33,416 ----------- Total U.S. Government Agencies 448,594 (Cost $437,557) ----------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 13.5% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (i) 3.625% due 07/15/2002 (b) 1,316,075 1,341,986 3.375% due 01/15/2007 (j) 296,572 299,816 3.625% due 01/15/2008 (j) 780,832 799,134 3.875% due 01/15/2009 (j) 474,836 493,829 3.625% due 04/15/2028 (j) 221,455 225,815 3.875% due 04/15/2029 (j) 132,096 141,013 U.S. Treasury Bonds 10.375% due 11/15/2012 305 396 12.000% due 08/15/2013 22,500 32,056 9.250% due 02/15/2016 147,500 203,766 7.250% due 05/15/2016 2,000 2,359 7.500% due 11/15/2016 450 543 8.875% due 02/15/2019 18,675 25,630 8.125% due 08/15/2019 75 97 8.750% due 08/15/2020 208,486 333,200 7.875% due 02/15/2021 1,390 1,766 8.125% due 05/15/2021 85,600 111,454 8.125% due 08/15/2021 14,450 18,841 8.000% due 11/15/2021 5,000 6,450 7.125% due 02/15/2023 204,300 242,660 6.250% due 08/15/2023 12,430 13,404 6.875% due 08/15/2025 11,600 13,495 6.000% due 02/15/2026 156,100 163,719 6.625% due 02/15/2027 700 794 5.500% due 08/15/2028 70,300 69,103 6.125% due 08/15/2029 1 1 U.S. Treasury Notes 6.625% due 07/31/2001 75 76 6.375% due 08/15/2002 4,500 4,631 6.250% due 08/31/2002 1,430 1,470 6.250% due 02/15/2003 1,000 1,036 4.250% due 11/15/2003 85,000 84,811 12.375% due 05/15/2004 (b) 1,000 1,226 6.000% due 08/15/2004 3,500 3,665 5.875% due 11/15/2004 265,700 277,571 6.750% due 05/15/2005 402,300 434,979 6.875% due 05/15/2006 1,000 1,101 5.625% due 05/15/2008 1,625 1,697 5.750% due 08/15/2010 1,830 1,929 5.750% due 11/15/2005 84,800 88,947 U.S. Treasury Strips 0.000% due 11/15/2001 43 42 0.000% due 05/15/2013 4,500 2,356 0.000% due 02/15/2014 64,900 32,157 0.000% due 02/15/2015 105,000 48,595 0.000% due 05/15/2015 182,700 83,082 0.000% due 08/15/2015 170,500 75,697 0.000% due 11/15/2018 108,200 39,243 0.000% due 02/15/2019 2,000 716 0.000% due 05/15/2020 22,000 7,292 ----------- Total U.S. Treasury Obligations 5,733,646 (Cost $5,580,480) ----------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 76.8% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 25.2% ABN AMRO Mortgage Corp. 6.750% due 09/25/2028 3,765 3,745 6.750% due 11/25/2028 600 583 6.500% due 06/25/2029 7,093 6,857 American Southwest Financial Securities Corp. 7.400% due 11/17/2004 26,491 27,176 12.500% due 04/01/2015 238 239 12.000% due 05/01/2015 433 447 7.248% due 11/25/2038 56,843 59,232 Amresco Commercial Mortgage Funding I 7.180% due 06/17/2029 55 58 Aurora Loan Services 7.319% due 05/25/2030 (d) 36,969 37,097 Banc of America Funding Corp. 6.750% due 11/20/2032 17,000 17,252 Bank of America Mortgage Securities, Inc. 6.250% due 07/25/2014 9,800 9,734 6.250% due 08/25/2028 25,000 23,769 6.500% due 05/25/2029 35,391 34,371 7.250% due 10/25/2029 10,753 10,841 7.500% due 01/25/2031 166,584 170,203 7.500% due 02/25/2031 12,864 13,167 7.000% due 03/25/2032 53,400 54,220 Bear Stearns Adjustable Rate Mortgage Trust 7.497% due 11/25/2030 (d) 138,892 139,510 7.490% due 12/25/2030 (d) 153,119 154,719 7.499% due 12/25/2030 (d) 156,231 158,008 6.944% due 02/25/2031 (d) 20,835 21,037 7.499% due 02/25/2031 (d) 33,766 34,067 Bear Stearns Commercial Mortgage Securities, Inc. 5.910% due 05/14/2008 131 132 7.000% due 05/20/2030 45,308 46,837 Bear Stearns Mortgage Securities, Inc. 6.097% due 10/25/2023 (d) 2,566 2,716 10.000% due 08/25/2024 5,000 5,645 7.000% due 03/25/2027 7,000 7,095 8.125% due 09/25/2027 2,977 3,071 7.000% due 02/25/2028 10,000 10,168 7.421% due 06/25/2030 (d) 5,972 5,972 Capco America Securitization Corp. 5.860% due 12/15/2007 45 45 CDC Depositor Trust I 6.311% due 01/15/2003 (d) 14,534 14,481 Cendant Mortgage Corp. 7.250% due 04/18/2013 757 761 6.503% due 11/18/2028 (d) 6,148 5,434 6.505% due 11/18/2028 (d) 13,528 13,211 Chase Mortgage Finance Corp. 7.000% due 07/25/2024 1,789 1,788 7.000% due 08/25/2024 2,791 2,827 6.750% due 03/25/2025 11,840 11,198 8.494% due 04/25/2025 (d) 8,476 8,650 6.750% due 10/25/2028 39,000 38,987 6.350% due 07/25/2029 62,292 63,147 7.750% due 08/25/2030 9,962 10,403 Chemical Mortgage Securities, Inc. 7.250% due 01/25/2026 11,329 11,644 Citibank, NA 8.000% due 07/25/2018 37 37 Citicorp Mortgage Securities, Inc. 7.963% due 10/25/2022 (d) 8,985 9,117 6.250% due 04/25/2024 11,796 11,249 6.250% due 05/25/2024 1,865 1,864 7.250% due 10/25/2027 20,462 20,811 6.500% due 11/25/2027 14,015 14,013 6.750% due 09/25/2028 9,334 9,343 5.900% due 05/25/2029 2,286 2,280 7.000% due 09/25/2030 7,249 7,166 7.500% due 10/25/2030 11,588 11,773 7.000% due 02/25/2031 34,210 34,131 CMC Securities Corp. II 8.625% due 04/25/2025 (d) 110 109 96 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CMC Securities Corp. III 6.750% due 05/25/2028 $ 5,000 $ 5,040 CMC Securities Corp. IV 7.250% due 11/25/2027 10,436 10,722 Collateralized Mortgage Obligation Trust 7.250% due 04/23/2017 56 57 8.000% due 09/20/2021 5,730 5,845 Collateralized Mortgage Obligation Trust I 10.200% due 02/01/2016 1,957 2,001 Collateralized Mortgage Securities Corp. 11.450% due 11/01/2015 (d) 115 115 8.750% due 04/20/2019 358 371 8.800% due 04/20/2019 237 247 COMM 6.145% due 02/15/2008 14,528 14,739 6.488% due 12/16/2011 (d) 9,000 9,014 Commercial Mortgage Acceptance Corp. 7.030% due 05/15/2009 75 79 Commercial Mortgage Asset Trust 6.640% due 09/17/2010 455 467 6.975% due 04/17/2013 145 151 Countrywide Alternative Loan Trust 8.000% due 07/25/2030 18,606 19,088 Countrywide Funding Corp. 6.625% due 02/25/2024 33,827 33,584 6.750% due 03/25/2024 12,679 12,164 Countrywide Home Loans 6.500% due 07/25/2013 5,676 5,695 6.250% due 08/25/2014 3,718 3,695 8.795% due 07/25/2024 (d) 1,462 1,474 6.750% due 11/25/2025 25,567 25,195 7.500% due 04/25/2027 1,523 1,580 7.500% due 06/25/2027 12,045 12,467 7.500% due 09/25/2027 20,000 20,527 7.250% due 12/25/2027 6,224 6,232 7.250% due 02/25/2028 57,846 58,732 6.750% due 06/25/2028 15,103 14,553 6.750% due 08/25/2028 6,961 6,975 6.750% due 10/25/2028 15,567 15,049 6.750% due 11/25/2028 5,000 4,978 6.500% due 01/25/2029 24,978 24,619 6.500% due 03/25/2029 21,744 21,100 6.050% due 04/25/2029 1,135 1,141 7.250% due 08/25/2029 5,700 5,630 7.750% due 04/25/2030 50,095 51,021 7.750% due 10/25/2030 30,527 30,827 7.750% due 01/25/2031 53,795 55,218 Credit-Based Asset Servicing and Securitization 5.940% due 09/25/2029 (d) 1,102 1,107 7.048% due 02/25/2030 (d) 46,942 46,978 Crusade Global Trust 5.719% due 05/15/2021 (d) 91,106 91,334 CS First Boston Mortgage Securities Corp. 6.960% due 01/20/2004 85 87 6.520% due 07/17/2007 50 51 6.750% due 12/27/2028 13,112 12,841 7.500% due 03/25/2031 50,000 50,491 Dime Savings 7.293% due 11/01/2018 (d) 166 154 DLJ Commercial Mortgage Corp. 6.025% due 09/05/2001 (d) 1,029 1,029 7.571% due 09/05/2001 (d) 2,000 2,010 6.880% due 05/05/2003 (d) 31,164 31,183 DLJ Mortgage Acceptance Corp. 6.446% due 08/01/2021 (d)(l) 3,454 3,454 8.000% due 03/25/2022 111 111 8.874% due 12/25/2022 (d) 1,273 1,289 9.054% due 03/25/2024 (d) 332 337 9.308% due 05/25/2024 (d) 89 90 9.488% due 10/25/2024 (d) 358 380 6.850% due 12/17/2027 6,605 6,835 Drexel Burnham Lambert Trust 9.500% due 11/20/2017 552 565 DVI Business Credit Receivable Corp. III 6.461% due 10/15/2003 (d) 3,850 3,881 Fannie Mae 7.500% due 05/25/2005 6,700 6,908 7.500% due 02/25/2006 375 386 7.000% due 05/25/2006 263 268 6.500% due 07/25/2006 34 34 8.000% due 11/25/2006 20 20 6.350% due 12/25/2006 5 5 7.500% due 05/25/2007 880 897 6.250% due 07/25/2007 52 52 6.000% due 07/25/2007 300 303 6.740% due 08/25/2007 145 151 5.243% due 08/25/2007 (d) 7 7 6.270% due 09/25/2007 3,000 3,049 7.000% due 10/25/2007 200 206 6.500% due 05/25/2008 500 512 10.500% due 08/25/2008 7,146 8,043 6.000% due 08/25/2008 50 50 7.684% due 09/25/2008 (d) 1,606 1,555 6.000% due 02/25/2009 1,400 1,421 4.000% due 02/25/2009 27 26 6.500% due 02/25/2009 50 50 6.500% due 03/25/2009 95 96 6.500% due 08/25/2010 500 500 6.750% due 11/25/2010 655 658 6.500% due 04/25/2013 75 78 6.000% due 03/18/2015 6,888 6,897 6.450% due 09/25/2016 2,334 2,341 8.000% due 12/25/2016 164 170 11.000% due 11/25/2017 919 1,021 9.250% due 04/25/2018 151 163 9.300% due 05/25/2018 614 656 9.500% due 06/25/2018 509 548 6.081% due 06/25/2018 (d) 3 3 6.600% due 09/25/2018 379 378 9.500% due 11/25/2018 5,855 6,066 6.000% due 02/25/2019 3,010 3,018 6.500% due 03/25/2019 818 823 9.500% due 06/25/2019 1,248 1,343 6.350% due 08/25/2019 145 145 9.300% due 08/25/2019 68 73 9.000% due 12/25/2019 5,495 5,804 7.500% due 12/25/2019 68 70 7.000% due 03/25/2020 1,241 1,256 7.000% due 04/25/2020 28 29 7.500% due 05/25/2020 2,809 2,894 6.044% due 07/18/2020 (d) 27 27 6.500% due 09/25/2020 751 751 7.000% due 09/25/2020 8,696 8,738 9.000% due 09/25/2020 2,913 3,095 5.000% due 09/25/2020 200 197 7.125% due 12/25/2020 (d) 4 4 8.000% due 12/25/2020 27,085 28,255 9.000% due 01/25/2021 4,649 4,952 8.750% due 01/25/2021 2,874 3,029 5.750% due 02/18/2021 100 99 9.000% due 03/25/2021 409 433 7.000% due 05/25/2021 300 306 6.500% due 06/25/2021 6,295 6,347 7.500% due 06/25/2021 21 21 8.000% due 07/25/2021 13,648 14,151 8.500% due 09/25/2021 4,817 5,075 7.000% due 10/25/2021 9,647 9,882 8.000% due 10/25/2021 22,645 23,044 7.000% due 11/25/2021 20,052 20,282 6.000% due 12/17/2021 567 567 6.000% due 12/25/2021 24 24 5.000% due 12/25/2021 500 470 4.000% due 01/25/2022 126 121 8.000% due 01/25/2022 21,700 22,213 8.000% due 03/25/2022 49 50 7.000% due 04/25/2022 17,091 17,270 5.000% due 04/25/2022 48 46 7.000% due 04/25/2022 139 139 7.500% due 05/25/2022 2,000 2,083 7.375% due 05/25/2022 9,573 9,800 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 97 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 7.000% due 06/25/2022 $ 1,164 $ 1,192 8.000% due 06/25/2022 4,018 4,221 8.000% due 07/25/2022 59,758 62,379 7.000% due 07/25/2022 5,064 5,195 7.800% due 10/25/2022 3,024 3,154 6.500% due 10/25/2022 4,181 4,171 6.500% due 12/25/2022 180 181 6.500% due 01/25/2023 1,036 113 7.000% due 03/25/2023 29,916 30,517 6.500% due 05/18/2023 9,153 9,219 6.900% due 05/25/2023 165 163 7.000% due 06/25/2023 5,445 5,296 6.500% due 08/25/2023 35 35 6.000% due 08/25/2023 14,106 13,050 6.500% due 09/18/2023 912 922 6.750% due 09/25/2023 4,107 4,039 1.000% due 09/25/2023 171 158 6.750% due 10/25/2023 618 608 6.500% due 10/25/2023 8,895 8,615 7.500% due 10/25/2023 42 43 6.500% due 11/25/2023 85 85 7.100% due 12/25/2023 6,769 6,762 6.500% due 12/25/2023 159 158 6.500% due 01/25/2024 47,302 45,711 5.000% due 01/25/2024 500 487 7.250% due 02/25/2024 4 4 6.500% due 02/25/2024 5,150 5,182 7.000% due 03/25/2024 5,000 5,098 7.500% due 06/20/2024 85 86 6.500% due 08/17/2024 17,000 16,882 6.000% due 12/25/2024 1,750 1,746 8.000% due 02/17/2025 41 41 7.000% due 02/18/2025 94 95 6.600% due 05/18/2025 219 224 7.500% due 11/17/2025 289 300 7.500% due 12/25/2025 360 371 7.000% due 02/15/2026 180 182 6.950% due 03/25/2026 212 213 7.000% due 07/18/2026 450 450 6.500% due 09/18/2026 120 120 7.000% due 12/18/2026 16,889 16,816 6.000% due 12/25/2026 170 168 8.500% due 02/17/2027 1,403 1,531 6.000% due 03/25/2027 320 316 5.000% due 04/18/2027 1,000 952 6.000% due 05/17/2027 5,470 4,931 6.500% due 07/18/2027 178 170 7.000% due 07/18/2027 460 463 8.000% due 08/18/2027 262 43 7.500% due 08/20/2027 2,598 2,701 7.000% due 12/20/2027 12,735 12,744 7.019% due 04/18/2028 (d) 2,877 2,880 6.500% due 06/25/2028 4,700 4,429 6.500% due 07/18/2028 67,412 65,916 6.000% due 07/18/2028 8,867 7,742 9.113% due 09/25/2028 17,398 19,866 6.500% due 10/25/2028 40,000 39,300 6.250% due 02/25/2029 500 469 7.500% due 04/25/2029 1,240 1,272 6.000% due 04/25/2029 11,137 9,546 7.118% due 08/25/2030 (d) 80,172 80,313 6.030% due 10/18/2030 (d) 63,604 63,695 6.390% due 05/25/2036 30,491 28,228 6.500% due 06/17/2038 5,000 5,037 6.300% due 10/17/2038 15,965 15,110 FBS Mortgage Corp. 7.144% due 11/25/2024 150 150 FFCA Secured Lending Corp. 7.850% due 10/18/2017 29,600 30,791 First Commonwealth Savings & Loan 10.375% due 04/01/2005 15 15 First Horizon Asset Securities, Inc. 7.000% due 02/25/2031 20,818 20,794 First Interstate Bancorp 8.875% due 01/01/2009 (l) 143 152 9.125% due 01/01/2009 (d)(l) 9 9 First Nationwide Trust 6.500% due 03/25/2029 4,400 4,334 6.750% due 07/25/2029 1,515 1,512 7.750% due 07/25/2030 6,157 6,406 First Union Residential Securitization, Inc. 7.000% due 04/25/2025 352 357 6.750% due 08/25/2028 9,048 8,656 First Union-Lehman Brothers Commercial Mortgage 7.150% due 02/18/2004 25 26 Freddie Mac 8.000% due 03/15/2002 70 71 7.500% due 04/15/2003 197 197 6.750% due 10/15/2003 12,774 12,866 7.000% due 10/15/2003 2,970 3,018 7.000% due 12/15/2003 76 78 6.500% due 04/15/2005 917 923 10.150% due 04/15/2006 5 5 6.500% due 07/15/2006 4,864 4,888 6.500% due 08/15/2006 349 350 7.500% due 02/15/2007 739 755 7.750% due 04/01/2007 15 15 7.500% due 04/01/2007 12 13 7.000% due 07/01/2007 2 2 6.500% due 07/15/2007 6,057 6,108 8.000% due 10/01/2007 52 53 5.500% due 10/15/2007 3,039 3,041 6.500% due 05/15/2008 1,000 1,017 2.800% due 06/15/2008 (d) 149 142 6.000% due 11/15/2008 225 227 6.200% due 12/15/2008 4,628 4,631 8.500% due 03/01/2009 131 137 6.000% due 03/15/2009 265 270 11.250% due 10/01/2009 3 3 7.000% due 06/01/2010 14 14 7.550% due 03/15/2012 180 186 11.875% due 06/15/2013 86 94 8.500% due 08/15/2013 2,000 2,064 8.500% due 09/15/2013 5,941 6,069 11.250% due 10/01/2014 67 76 6.000% due 11/15/2014 400 390 6.250% due 11/15/2015 851 852 10.100% due 09/01/2016 237 262 7.500% due 11/15/2016 28,791 29,682 6.250% due 10/15/2017 11,357 11,403 5.900% due 03/15/2018 1,652 1,651 6.350% due 03/25/2018 131 131 5.250% due 05/15/2018 4 4 6.400% due 02/15/2019 10,347 10,399 6.500% due 04/15/2019 1,566 1,578 6.500% due 05/15/2019 77 77 5.800% due 06/15/2019 2,092 2,090 6.250% due 07/15/2019 9,954 9,965 5.000% due 08/15/2019 55 55 10.000% due 11/15/2019 81 86 7.500% due 01/15/2020 1,444 1,448 5.638% due 06/15/2020 (d) 86 86 5.250% due 07/15/2020 216 215 5.750% due 08/15/2020 300 302 9.000% due 09/15/2020 50 52 5.000% due 10/15/2020 968 959 5.500% due 10/15/2020 38 38 9.500% due 11/15/2020 2,902 2,974 8.900% due 11/15/2020 9,925 10,247 9.000% due 12/15/2020 2,628 2,774 8.750% due 12/15/2020 1,254 1,315 6.000% due 12/15/2020 225 223 9.500% due 01/15/2021 1,789 1,893 6.250% due 01/15/2021 200 201 7.000% due 01/15/2021 3,735 3,761 8.000% due 04/15/2021 78 81 6.500% due 05/15/2021 92 93 98 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 6.500% due 05/17/2021 $ 49 $ 49 8.500% due 06/15/2021 17,153 17,956 6.000% due 06/15/2021 2,939 2,945 8.500% due 06/15/2021 5,137 5,413 6.950% due 07/15/2021 398 405 9.500% due 07/15/2021 1,014 1,035 8.000% due 07/15/2021 7,102 7,168 9.000% due 07/15/2021 1,868 1,981 6.950% due 08/15/2021 144 146 8.000% due 08/15/2021 23,472 23,945 6.200% due 08/15/2021 878 885 7.000% due 09/15/2021 112 115 6.500% due 09/15/2021 24,998 25,139 4.500% due 09/15/2021 264 255 7.000% due 10/15/2021 7 7 6.000% due 11/15/2021 1,058 1,059 8.000% due 12/15/2021 19,027 19,985 6.850% due 01/15/2022 700 714 8.250% due 06/15/2022 4,697 4,936 7.000% due 07/15/2022 9,699 9,711 8.500% due 10/15/2022 6,502 6,792 7.000% due 12/15/2022 21,000 21,499 7.500% due 01/15/2023 18,415 19,072 6.500% due 02/15/2023 1,250 1,281 7.500% due 05/01/2023 41 42 6.500% due 07/15/2023 240 245 7.000% due 07/15/2023 280 282 6.500% due 07/15/2023 32 32 7.500% due 07/15/2023 395 411 6.500% due 08/15/2023 125,035 126,064 6.850% due 10/25/2023 2,638 2,683 7.400% due 10/25/2023 (d) 13,188 13,646 6.500% due 11/15/2023 139 134 6.500% due 01/15/2024 35 35 7.500% due 01/20/2024 68 69 6.500% due 02/15/2024 20 20 5.000% due 02/15/2024 116 101 6.500% due 03/15/2024 331 322 8.000% due 04/25/2024 491 528 6.250% due 05/15/2024 13,780 13,119 8.500% due 08/01/2024 1,362 1,429 7.250% due 08/15/2024 190 193 8.000% due 09/15/2024 16,250 17,083 8.500% due 11/01/2024 558 586 6.750% due 01/17/2025 6,165 6,208 7.500% due 02/15/2025 3,044 3,092 6.000% due 02/15/2025 4,048 4,066 7.000% due 09/17/2025 40 41 7.000% due 03/01/2026 94 95 6.500% due 03/15/2026 110 108 6.000% due 08/15/2026 2,400 2,347 6.751% due 09/15/2026 (d) 49,153 49,002 8.348% due 10/01/2026 (d) 2,684 2,747 6.000% due 11/15/2026 550 545 7.000% due 01/01/2027 106 108 7.500% due 01/15/2027 26,198 27,277 8.000% due 02/15/2027 35,767 37,658 7.000% due 03/01/2027 133 135 7.500% due 03/17/2027 20,000 20,956 8.527% due 05/01/2027 (d) 508 521 6.750% due 05/15/2027 406 407 6.500% due 06/15/2027 10,499 10,013 7.500% due 06/20/2027 20,314 21,034 6.500% due 08/15/2027 16,157 15,316 6.500% due 09/15/2027 73,000 71,856 6.500% due 10/15/2027 32,300 31,887 6.000% due 11/15/2027 665 654 6.500% due 01/25/2028 8,691 8,511 7.000% due 02/15/2028 1,436 1,440 6.250% due 03/15/2028 10,000 9,555 6.500% due 04/15/2028 159,071 156,370 6.500% due 05/15/2028 51,566 50,355 6.500% due 06/15/2028 63,338 59,238 6.500% due 06/20/2028 24,032 22,687 7.000% due 07/01/2028 696 706 6.500% due 07/15/2028 72,353 66,330 6.500% due 08/15/2028 343,704 318,401 7.000% due 11/15/2028 9,000 9,089 6.000% due 12/01/2028 687 672 6.000% due 12/15/2028 11,442 10,057 6.250% due 12/15/2028 1,726 1,584 6.500% due 12/15/2028 7,289 6,698 6.000% due 12/15/2028 11,995 10,685 6.500% due 01/01/2029 1,461 1,461 6.000% due 01/15/2029 3,415 2,933 6.500% due 01/15/2029 10,411 10,291 6.000% due 02/15/2029 3,990 3,405 6.500% due 03/01/2029 611 611 6.500% due 03/15/2029 26,203 25,100 6.500% due 05/01/2029 894 893 6.500% due 06/01/2029 102 102 6.500% due 07/01/2029 1,045 1,043 8.000% due 07/15/2029 1,250 1,287 7.500% due 02/01/2030 1,129 1,156 7.500% due 07/15/2030 1,000 1,016 7.500% due 08/15/2030 519 528 5.664% due 09/15/2030 14,402 14,468 7.000% due 09/15/2030 (d) 18,634 18,613 7.000% due 10/15/2030 11,702 11,717 7.500% due 10/15/2030 28,215 28,290 5.614% due 11/15/2030 (d) 1,579 1,579 6.947% due 08/15/2032 (d) 32,027 32,821 Gaston Oaks PLC 6.930% due 01/01/2036 2,251 2,237 General Electric Capital Mortgage Services, Inc. 6.000% due 01/25/2009 519 519 7.250% due 07/25/2011 75 75 6.750% due 12/25/2012 2,088 2,106 6.500% due 09/25/2023 1,175 1,096 6.500% due 12/25/2023 8,631 8,020 6.500% due 01/25/2024 3,895 3,571 6.500% due 03/25/2024 67,513 66,553 6.500% due 04/25/2024 68,828 64,342 7.250% due 05/25/2026 3,748 3,810 7.500% due 06/25/2027 19,938 20,423 7.500% due 07/25/2027 10,066 10,331 7.000% due 10/25/2027 14,412 14,429 7.000% due 11/25/2027 72,500 73,736 6.650% due 05/25/2028 5,905 5,954 6.750% due 05/25/2028 23,934 23,988 6.750% due 06/25/2028 1,296 1,296 6.550% due 06/25/2028 23,450 23,905 6.750% due 06/25/2028 20,517 20,416 6.600% due 06/25/2028 5,936 5,987 6.750% due 10/25/2028 12,190 12,119 6.250% due 12/25/2028 54,624 52,461 6.500% due 12/25/2028 19,500 19,041 6.500% due 05/25/2029 9,858 9,566 6.750% due 05/25/2029 20,000 19,819 5.950% due 07/25/2029 24,794 24,788 6.500% due 07/25/2029 95,240 92,011 6.000% due 07/25/2029 23,507 23,577 6.250% due 07/25/2029 132,674 134,144 7.250% due 08/25/2029 8,000 8,106 7.000% due 09/25/2029 16,073 16,182 General Electric Credit Corp. 8.000% due 03/01/2002 (l) 3 3 German American Capital Corp. 4.306% due 07/01/2018 (d) 7,923 7,834 GGP - Homart 7.138% due 06/10/2003 (d) 19,459 19,482 GMAC Commercial Mortgage Asset Corp. 6.919% due 07/20/2002 3,256 3,256 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 99 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- GMAC Commercial Mortgage Securities, Inc. 6.566% due 11/15/2007 $ 85 $ 87 6.150% due 11/15/2007 254 258 6.700% due 03/15/2008 29,732 30,468 6.974% due 05/15/2008 27,444 28,614 6.945% due 09/15/2033 25,060 26,114 6.570% due 09/15/2033 46,597 47,911 GMAC Mortgage Corp. Loan Trust 7.500% due 05/25/2030 12,000 12,487 Goldman Sachs Mortgage Corp. 6.000% due 12/31/2007 (l) 8,171 8,165 Government National Mortgage Association 6.250% due 06/20/2022 33,961 34,212 7.219% due 06/20/2023 (d) 24,407 24,430 7.250% due 12/16/2023 6,294 6,405 8.000% due 05/16/2024 50 51 7.000% due 06/20/2025 12,138 12,259 7.000% due 03/20/2026 320 327 6.000% due 03/20/2026 1,500 1,500 6.070% due 06/16/2026 (d) 1,378 1,378 7.000% due 08/20/2026 104 106 7.500% due 07/16/2027 30,865 31,835 7.000% due 12/20/2027 18,960 19,026 8.000% due 04/16/2028 4,627 4,638 6.500% due 04/20/2028 11,887 10,962 6.750% due 06/20/2028 22,864 21,468 6.500% due 06/20/2028 31,364 28,982 7.250% due 07/16/2028 30 31 6.500% due 07/20/2028 40,416 36,141 6.500% due 09/20/2028 29,986 28,282 6.500% due 01/20/2029 28,770 26,605 7.000% due 02/16/2029 6,815 7,088 6.500% due 03/20/2029 16,259 15,673 8.000% due 03/20/2029 7,151 7,567 6.000% due 05/20/2029 11,104 9,798 7.000% due 01/16/2030 6,686 6,621 7.500% due 01/20/2030 327 338 5.750% due 02/16/2030 (d) 7,778 7,792 6.383% due 02/16/2030 (d) 12,065 12,126 5.800% due 02/16/2030 (d) 8,418 8,440 7.086% due 06/20/2030 (d) 4,565 4,573 7.119% due 09/20/2030 (d) 11,835 11,804 7.500% due 09/20/2030 5,158 5,273 7.100% due 10/16/2030 (d) 70,053 70,272 Greenwich Capital Acceptance, Inc. 8.305% due 04/25/2022 (d) 314 313 8.325% due 10/25/2022 (d) 34 34 8.441% due 04/25/2023 (d) 676 674 8.935% due 04/25/2024 (d) 459 473 9.716% due 08/25/2024 (d) 356 360 9.687% due 11/25/2024 (d) 33 33 Guardian Savings & Loan Association 7.557% due 09/25/2018 (d) 75 76 Headlands Mortgage Securities, Inc. 7.250% due 11/25/2012 2,089 2,114 7.155% due 12/25/2012 686 697 7.250% due 11/25/2027 18,456 18,759 7.000% due 02/25/2028 410 411 Home Savings of America 8.464% due 08/01/2006 42 43 6.480% due 05/25/2027 (d) 2,455 2,434 6.563% due 08/20/2029 (d) 21,461 21,476 Housing Securities, Inc. 7.000% due 05/25/2008 833 849 HSBC Mortgage Loan Trust 7.110% due 11/16/2030 19,396 19,436 HVMLT 7.470% due 08/19/2030 22,975 23,996 ICI Funding Corp. Secured Assets Corp. 7.250% due 09/25/2027 18,068 18,445 7.750% due 03/25/2028 1,855 1,885 Impac Secured Assets CMN Owner Trust 6.850% due 07/25/2028 58 58 7.318% due 10/25/2030 (d) 54,327 54,639 Imperial CMB Trust 6.650% due 11/25/2029 949 969 Imperial Savings Association 8.230% due 01/25/2017 (d) 54 54 8.839% due 06/25/2017 (d) 206 206 Independent National Mortgage Corp. 8.250% due 05/25/2010 128 131 6.650% due 10/25/2024 2,723 2,738 8.634% due 11/25/2024 (d) 462 465 8.750% due 12/25/2024 30 31 9.232% due 01/25/2025 (d) 75 76 8.000% due 06/25/2025 0 0 8.225% due 07/25/2025 (d) 5,475 5,515 7.500% due 09/25/2025 471 472 6.930% due 05/25/2026 412 412 International Mortgage Acceptance Corp. 12.250% due 03/01/2014 247 286 J.P. Morgan Commercial Mortgage Finance Corp. 8.227% due 02/25/2028 1,615 1,677 7.069% due 09/15/2029 65 68 6.533% due 01/15/2030 20,000 20,510 Kidder Peabody Acceptance Corp. 8.937% due 09/25/2024 (d) 4,245 4,297 LB Commercial Conduit Mortgage Trust 6.330% due 11/18/2004 39 40 LB Mortgage Trust 8.396% due 01/20/2017 (d) 39,862 43,912 Lehman Large Loan 6.790% due 06/12/2004 55 57 LTC Commercial Corp. 7.100% due 11/28/2012 3,140 3,222 Mellon Residential Funding Corp. 6.500% due 02/25/2028 10,000 9,656 6.350% due 06/25/2028 22,000 22,185 5.652% due 06/26/2028 7,426 7,409 6.110% due 01/25/2029 23,900 23,970 6.570% due 07/25/2029 (d) 44,000 44,874 6.580% due 07/25/2029 (d) 55,565 56,238 6.460% due 07/25/2029 (d) 4,622 4,634 Merrill Lynch Mortgage Investors, Inc. 6.861% due 06/15/2021 1,982 2,020 6.978% due 06/15/2021 (d) 4,370 4,476 7.238% due 06/15/2021 (d) 4,099 4,194 7.598% due 06/15/2021 (d) 910 921 6.950% due 06/18/2029 34,041 35,062 5.650% due 12/15/2030 7,590 7,612 Midland Realty Acceptance Corp. 7.020% due 01/25/2029 12,112 12,400 MLCC Mortgage Investors, Inc. 6.875% due 09/15/2026 (d) 17,183 17,201 Morgan Stanley Capital I 6.440% due 11/15/2002 18 18 5.990% due 03/15/2005 54 55 6.860% due 05/15/2006 (d) 1,910 1,971 6.190% due 01/15/2007 19,529 19,879 6.160% due 04/03/2009 12,840 13,018 7.460% due 02/15/2020 10,542 11,073 6.850% due 07/25/2027 (d) 417 415 6.220% due 06/01/2030 68 69 6.590% due 10/03/2030 6,485 6,674 Mortgage Capital Funding, Inc. 7.800% due 04/15/2006 500 540 7.008% due 09/20/2006 15,545 16,161 7.600% due 05/25/2027 3,894 3,943 6.001% due 11/18/2031 69 70 NationsBanc Montgomery Funding Corp. 6.750% due 06/25/2028 10,000 9,926 6.500% due 07/25/2028 14,470 14,255 6.750% due 08/25/2028 20,009 19,535 6.250% due 10/25/2028 7,000 6,659 100 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Nationslink Funding Corp. 6.654% due 02/10/2006 $ 19,624 $ 20,248 5.921% due 04/10/2007 (d) 20,192 20,195 5.805% due 11/10/2030 7,174 7,175 Nomura Asset Securities Corp. 6.625% due 01/25/2009 19 19 8.105% due 05/25/2024 (d) 1,050 1,076 Norwest Asset Securities Corp. 6.750% due 12/25/2012 15,113 15,485 6.500% due 04/25/2013 19,557 19,750 6.500% due 06/25/2013 12,972 13,099 7.500% due 03/25/2027 41,558 42,684 6.750% due 09/25/2027 2,612 2,637 6.350% due 04/25/2028 1,084 1,085 6.750% due 05/25/2028 40,707 40,414 6.750% due 07/25/2028 12,657 12,578 6.250% due 08/25/2028 3,245 3,256 6.250% due 09/25/2028 400 383 6.200% due 09/25/2028 744 744 6.750% due 10/25/2028 38,104 37,906 6.500% due 12/25/2028 39,751 39,015 6.500% due 01/25/2029 385 346 6.500% due 02/25/2029 67,432 65,324 6.200% due 04/25/2029 77,385 77,159 6.500% due 04/25/2029 26,751 25,925 6.300% due 04/25/2029 6,847 6,855 5.950% due 04/25/2029 97,464 97,367 6.000% due 05/25/2029 19,713 19,772 6.250% due 05/25/2029 472 476 6.500% due 06/25/2029 46,178 44,631 6.750% due 08/25/2029 1,103 1,112 6.500% due 10/25/2029 1,969 1,905 7.000% due 11/25/2029 14,793 14,946 7.250% due 02/25/2030 19,756 20,095 Norwest Integrated Structured Assets, Inc. 7.000% due 09/25/2029 3,574 3,536 Paine Webber Mortgage Acceptance Corp. 6.000% due 04/25/2009 11,951 11,852 PHH Mortgage Services Corp. 7.184% due 11/18/2027 948 951 PNC Mortgage Securities Corp. 6.750% due 06/25/2016 8,897 8,960 7.000% due 10/25/2027 35,815 36,299 6.750% due 12/25/2027 7,230 6,929 6.990% due 02/25/2028 9,494 9,776 6.500% due 02/25/2028 850 849 7.000% due 02/25/2028 25,470 25,805 6.625% due 03/25/2028 1,561 1,572 7.000% due 05/25/2028 5,664 5,753 6.750% due 07/25/2028 3,527 3,509 6.550% due 07/25/2028 24,500 24,707 6.750% due 09/25/2028 3,996 3,974 6.750% due 10/25/2028 26,045 25,987 6.750% due 12/25/2028 21,709 21,443 6.500% due 01/25/2029 999 975 6.250% due 01/25/2029 9,263 8,991 6.300% due 03/25/2029 9,989 9,505 6.200% due 06/25/2029 46,288 46,757 6.500% due 06/25/2029 48,600 46,862 7.750% due 07/25/2030 67,726 69,530 6.013% due 12/25/2030 (d) 35,452 35,519 7.500% due 02/25/2031 88,982 92,271 7.500% due 05/25/2040 (d) 444 451 PNC Mortgage Trust 8.250% due 03/25/2030 58,189 59,980 Prudential Home Mortgage Securities 7.400% due 11/25/2007 1,416 1,443 7.000% due 01/25/2008 23,860 24,270 6.750% due 07/25/2008 1,256 1,268 6.400% due 04/25/2009 330 329 6.950% due 11/25/2022 222 219 7.000% due 07/25/2023 10,270 10,431 6.750% due 10/25/2023 9,940 9,261 5.900% due 12/25/2023 3,376 3,382 6.500% due 01/25/2024 617 619 6.050% due 04/25/2024 1,959 1,957 6.800% due 05/25/2024 11,349 10,985 6.450% due 11/25/2025 5,264 4,959 Prudential Securities Secured Financing Corp. 6.074% due 01/15/2008 11,965 12,107 Prudential-Bache Trust 6.676% due 09/01/2018 (d) 195 196 8.400% due 03/20/2021 5,367 5,614 PSB Financial Corp. II 11.050% due 12/01/2015 405 429 Resecuritization Mortgage Trust 6.750% due 06/19/2028 18,121 18,155 6.500% due 04/19/2029 3,764 3,824 Residential Accredit Loans, Inc. 7.500% due 08/25/2027 15,000 15,394 6.500% due 02/25/2028 11,531 11,518 7.000% due 02/25/2028 41,115 41,869 6.500% due 12/25/2028 400 391 6.500% due 05/25/2029 3,000 2,925 6.750% due 06/25/2029 1,464 1,478 7.000% due 07/25/2029 418 422 7.750% due 03/25/2030 3,389 3,431 Residential Asset Securitization Trust 7.375% due 03/25/2027 5,142 5,267 7.000% due 10/25/2027 19,360 19,763 7.000% due 01/25/2028 20,000 20,225 6.750% due 06/25/2028 13,193 13,307 6.500% due 12/25/2028 1,250 1,237 6.500% due 03/25/2029 22,700 22,629 8.000% due 02/25/2030 43,760 45,111 7.320% due 09/25/2030 (d) 15,052 15,159 Residential Funding Mortgage Securities I 7.000% due 08/25/2008 3,902 3,922 7.500% due 09/25/2011 12,122 12,355 7.000% due 05/25/2012 3,095 3,197 6.500% due 12/25/2012 20,123 20,124 7.750% due 09/25/2022 391 393 8.000% due 01/25/2023 2,615 2,655 8.000% due 02/25/2023 9,225 9,403 6.500% due 11/25/2023 1,660 1,601 6.000% due 03/25/2024 392 391 7.500% due 09/25/2025 9,892 9,973 7.500% due 12/25/2025 937 971 7.750% due 11/25/2026 9,000 9,366 7.500% due 04/25/2027 6,085 6,229 7.500% due 06/25/2027 53,035 54,222 7.500% due 07/25/2027 25,265 26,042 7.250% due 08/25/2027 16,000 16,134 7.250% due 10/25/2027 39,303 39,700 7.000% due 11/25/2027 17,000 17,262 6.750% due 02/25/2028 32,196 32,342 6.750% due 05/25/2028 60,741 60,780 6.750% due 06/25/2028 67,908 66,989 6.750% due 07/25/2028 13,292 13,228 6.750% due 08/25/2028 35,000 34,836 6.750% due 09/25/2028 66,493 66,027 6.500% due 10/25/2028 52,000 50,794 6.250% due 11/25/2028 3,000 2,878 6.500% due 12/25/2028 23,400 22,784 6.500% due 01/25/2029 72,314 70,451 6.500% due 03/25/2029 27,960 27,184 6.200% due 05/25/2029 46,610 46,622 6.500% due 06/25/2029 11,708 10,347 6.750% due 07/25/2029 22,600 22,573 7.000% due 10/25/2029 25,260 25,415 7.500% due 02/25/2030 12,338 12,704 7.750% due 10/25/2030 26,572 27,237 7.500% due 11/25/2030 183,575 187,754 Resolution Trust Corp. 8.686% due 08/25/2021 6,075 6,057 11.062% due 10/25/2021 46 48 8.625% due 10/25/2021 115 114 8.138% due 10/25/2021 (d) 123 122 5.567% due 10/25/2021 (d) 127 127 8.720% due 05/25/2022 (d) 1,211 1,207 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 101 PIMCO Schedule of Investments Class D (Cont.) Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 8.640% due 08/25/2023 (d) $ 1,733 $ 1,754 8.835% due 12/25/2023 3,300 3,368 8.000% due 04/25/2025 156 155 8.000% due 06/25/2026 249 246 8.427% due 10/25/2028 (d) 4,388 4,466 7.596% due 10/25/2028 (d) 12,343 12,404 7.510% due 05/25/2029 (d) 2,266 2,322 7.245% due 05/25/2029 (d) 2,486 2,504 6.923% due 05/25/2029 (d) 2,865 2,867 RMF Commercial Mortgage Securities, Inc. 6.715% due 01/15/2019 (d) 235 241 Ryan Mortgage Acceptance Corp. IV 9.450% due 10/01/2016 73 78 Ryland Acceptance Corp. 11.500% due 12/25/2016 80 86 8.200% due 09/25/2022 11 11 Ryland Mortgage Securities Corp. 8.200% due 06/25/2021 34 34 8.518% due 08/25/2022 (d) 1,587 1,602 8.108% due 08/25/2029 (d) 1,762 1,769 7.402% due 10/25/2031 (d) 2,085 2,102 14.000% due 11/25/2031 684 731 SACO I, Inc. 7.460% due 07/25/2030 506 506 8.128% due 07/25/2030 15,241 15,769 6.140% due 09/25/2040 (d) 546 546 Salomon Brothers Mortgage Securities VII 8.613% due 09/25/2022 (d) 746 752 8.565% due 11/25/2022 (d) 382 387 8.950% due 03/25/2024 (d) 287 293 9.240% due 07/01/2024 (d) 3,732 3,790 9.307% due 09/25/2024 (d) 266 272 6.960% due 04/25/2029 (d) 14,057 14,094 5.430% due 04/25/2029 (d) 5,444 5,463 6.918% due 06/25/2029 (d) 34,211 34,195 7.600% due 08/25/2030 125,500 128,143 Santa Barbara Savings & Loan Association 9.500% due 11/20/2018 1,792 1,847 Sasco Floating Rate Commercial Mortgage Trust 5.408% due 11/20/2001 (d) 36,906 36,938 Saxon Mortgage Securities Corp. 6.250% due 04/25/2009 2,032 2,039 7.375% due 09/25/2023 6,372 6,498 6.500% due 02/25/2024 1,517 1,525 9.154% due 09/25/2024 (d) 1,267 1,278 Sears Mortgage Securities 12.000% due 02/25/2014 534 556 7.896% due 11/25/2021 (d) 449 455 7.431% due 10/25/2022 (d) 1,538 1,555 6.278% due 12/25/2028 254 253 Securitized Asset Sales, Inc. 8.543% due 12/26/2023 (d) 620 647 7.410% due 09/25/2024 (d) 9,900 10,078 Security Pacific National Bank 6.378% due 03/25/2018 (d) 81 81 7.156% due 09/25/2019 (d) 462 463 Sequoia Mortgage Trust 6.350% due 09/25/2025 (d) 5,343 5,396 Small Business Investment Cos. 7.540% due 08/10/2009 93,532 99,276 8.017% due 02/10/2010 115,208 125,258 7.640% due 03/10/2010 69,504 73,960 7.452% due 09/01/2010 15,860 16,698 Starwood Commercial Mortgage Trust 6.600% due 02/03/2009 11,041 11,389 Structured Asset Mortgage Investments, Inc. 6.750% due 03/25/2028 22,356 22,065 6.902% due 06/25/2028 (d) 35,851 37,373 6.250% due 11/25/2028 14,878 14,219 6.750% due 01/25/2029 10,000 9,916 6.300% due 05/25/2029 21,870 21,958 6.581% due 06/25/2029 (d) 29,054 29,515 7.250% due 07/25/2029 19,588 19,812 7.226% due 02/25/2030 (d) 908 931 6.750% due 05/02/2030 25,000 24,035 Structured Asset Notes Transactions Ltd. 6.650% due 08/30/2005 (d) 16,364 16,241 Structured Asset Securities Corp. 7.000% due 02/25/2016 30,002 30,587 7.000% due 12/25/2027 51,500 52,079 7.220% due 11/25/2030 (d) 38,908 38,774 Superannuation Members Home Loans Global Fund 6.835% due 06/15/2026 (d) 19,900 19,900 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 30,145 30,145 Torrens Trust 5.424% due 07/15/2031 (d) 3,593 3,593 Union Planters Mortgage Finance Corp. 6.750% due 01/25/2028 4,000 3,969 6.800% due 01/25/2028 15,000 15,226 United Mortgage Securities Corp. 7.302% due 06/25/2032 18,991 19,194 7.108% due 09/25/2033 (d) 393 406 Vendee Mortgage Trust 7.500% due 08/15/2017 229 232 7.750% due 05/15/2018 550 561 6.500% due 05/15/2020 29,697 29,460 7.750% due 05/15/2022 303 319 6.835% due 01/15/2030 15,952 16,345 Washington Mutual, Inc. 5.690% due 07/26/2003 (d) 109,938 109,905 7.500% due 11/19/2029 600 618 7.608% due 12/25/2040 37,551 37,657 7.175% due 01/25/2041 112,469 115,949 Wells Fargo Mortgage Backed Securities Trust 7.500% due 01/25/2031 5,094 5,049 Western Federal Savings & Loan Association 7.997% due 06/25/2021 (d) 2,561 2,565 ----------- 10,689,693 ----------- Fannie Mae 7.1% 5.500% due 01/01/2004-01/01/2031 (k) 20,723 19,717 6.000% due 11/01/2003-04/16/2031 (k) 1,013,468 988,527 6.090% due 12/01/2008 49 49 6.210% due 08/01/2010-04/01/2027 (d)(k) 50,969 51,573 6.255% due 09/01/2013 64,000 64,168 6.258% due 09/01/2029 (d) 587 595 6.420% due 12/01/2007 150 155 6.500% due 04/01/2003-03/01/2031 (k) 20,264 20,362 6.550% due 01/01/2008 950 986 6.570% due 04/01/2026 (d) 1,093 1,128 6.626% due 12/01/2027 (d) 7,508 7,775 6.688% due 08/01/2027 (d) 35,083 35,996 6.726% due 05/01/2030 (d) 253 255 6.730% due 11/01/2007 1,138 1,191 6.739% due 09/01/2017 (d) 5,229 5,224 6.750% due 08/01/2003 164 165 6.840% due 09/01/2024 (d) 1,869 1,900 6.847% due 07/01/2003 61 62 6.961% due 01/01/2018 (d) 1,046 1,068 6.969% due 10/01/2027 (d) 4,022 4,154 6.981% due 06/01/2007 462 486 7.000% due 07/01/2001-05/15/2031 (k) 1,369,639 1,384,885 7.250% due 05/01/2002-01/01/2023 (k) 9,520 9,595 7.350% due 09/01/2027 (d) 1,555 1,618 7.364% due 02/01/2028 (d) 1,139 1,180 7.468% due 06/01/2030 (d) 41,866 44,208 7.500% due 10/01/2002-10/01/2030 (k) 19,040 19,685 7.508% due 10/01/2030-10/01/2040 (d)(k) 31,856 32,791 7.552% due 05/01/2023 (d) 2,062 2,127 7.750% due 06/01/2009 149 154 7.780% due 01/01/2018 2,230 2,518 7.850% due 07/01/2018 6,699 7,425 7.920% due 03/01/2018 2,745 3,137 7.980% due 05/01/2030 6,678 6,990 8.000% due 09/01/2001-04/16/2031 (k) 188,605 194,508 8.039% due 05/01/2025 (d) 2,273 2,334 8.060% due 04/01/2030 1,854 1,947 8.079% due 09/01/2022 (d) 911 936 102 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 8.080% due 04/01/2030 $ 1,015 $ 1,066 8.095% due 06/01/2023 (d) 1,851 1,907 8.097% due 12/01/2023 (d) 678 695 8.108% due 10/01/2024 (d) 263 269 8.189% due 09/01/2024 (d) 1,211 1,231 8.211% due 12/01/2023 (d) 769 782 8.230% due 11/01/2025 (d) 1,140 1,170 8.235% due 03/01/2025-11/01/2025 (d)(k) 4,395 4,518 8.250% due 10/01/2008-03/01/2030 (k) 2,194 2,431 8.276% due 08/01/2027 (d) 939 970 8.291% due 01/01/2024-07/01/2024 (d)(k) 4,347 4,453 8.315% due 01/01/2024 (d) 358 369 8.318% due 02/01/2026 (d) 466 483 8.344% due 11/01/2023 (d) 758 779 8.347% due 09/01/2025 (d) 1,184 1,216 8.348% due 11/01/2025 (d) 3,033 3,114 8.362% due 01/01/2024 (d) 1,604 1,654 8.364% due 10/01/2024 (d) 1,343 1,389 8.374% due 03/01/2026 (d) 1,629 1,695 8.380% due 09/01/2022 (d) 948 972 8.389% due 08/01/2026 (d) 1,630 1,684 8.396% due 01/01/2026 (d) 1,044 1,078 8.405% due 12/01/2023 (d) 163 168 8.410% due 09/01/2023 (d) 2,195 2,238 8.418% due 06/01/2024 (d) 1,219 1,247 8.446% due 10/01/2023 (d) 304 314 8.450% due 11/01/2023 (d) 164 170 8.451% due 05/01/2026 (d) 501 514 8.472% due 01/01/2024 (d) 111 115 8.490% due 06/01/2025 992 1,047 8.494% due 12/01/2023 (d) 1,017 1,051 8.500% due 07/01/2001-09/01/2030 (k) 6,923 7,241 8.574% due 05/01/2024 (d) 1,970 2,012 8.903% due 08/01/2023 (d) 518 539 9.000% due 10/01/2004-12/01/2027 (k) 8,542 9,056 9.250% due 10/01/2001 1 1 9.500% due 12/01/2006-07/01/2026 (k) 8,569 9,017 9.750% due 11/01/2008 49 53 10.000% due 09/01/2003-05/01/2022 (k) 1,106 1,208 10.500% due 01/01/2016-04/01/2022 (k) 480 532 10.750% due 03/01/2014 24 26 11.000% due 09/01/2019-11/01/2020 (k) 113 127 11.500% due 08/20/2016-11/01/2019 (k) 72 81 12.000% due 05/01/2016 8 10 12.500% due 10/01/2015 27 31 13.000% due 09/01/2013 27 32 13.250% due 09/01/2011 11 13 14.500% due 11/01/2011-01/01/2013 (k) 36 42 14.750% due 08/01/2012 146 175 15.000% due 10/01/2012 77 93 15.500% due 10/01/2012-12/01/2012 (k) 16 18 15.750% due 12/01/2011-08/01/2012 (k) 86 103 16.000% due 09/01/2012 99 117 ----------- 2,992,890 ----------- Federal Housing Administration 1.2% 6.000% due 03/20/2028 4,598 4,490 6.500% due 05/28/2039 5 5 6.750% due 07/15/2001 1,444 1,451 6.755% due 03/01/2041 16,213 16,129 6.780% due 07/25/2040 7,658 7,553 6.790% due 05/01/2039 10,902 10,123 6.830% due 12/01/2039 3,497 3,460 6.875% due 11/01/2015 3,153 3,057 6.880% due 10/25/2040-02/01/2041 (k) 21,722 21,571 6.896% due 07/01/2020 22,087 21,254 6.900% due 12/01/2040 22,769 22,643 6.930% due 07/01/2014-01/01/2036 (k) 20,005 19,892 7.000% due 11/15/2040 63 65 7.050% due 03/25/2040 4,517 4,541 7.125% due 03/01/2034 4,401 4,265 7.150% due 01/25/2029 9,573 9,295 7.211% due 12/01/2021 2,695 2,649 7.250% due 06/01/2040 8,304 8,437 7.310% due 06/01/2041 23,566 24,048 7.315% due 08/01/2019 32,306 32,024 7.317% due 05/01/2019 4,725 4,621 7.350% due 11/01/2020-11/01/2022 (k) 9,945 9,882 7.375% due 02/01/2018-01/01/2024 (k) 16,436 16,332 7.400% due 01/25/2020-02/01/2021 (k) 12,034 11,995 7.430% due 12/01/2016-05/01/2025 (k) 135,778 135,600 7.450% due 12/01/2021-10/01/2023 (k) 15,942 15,905 7.460% due 01/01/2023 2,137 2,136 7.465% due 11/01/2019 29,537 29,528 7.500% due 03/01/2032-09/30/2039 (k) 4,890 4,981 7.580% due 12/01/2040 7,616 7,834 7.630% due 08/01/2041 20,577 21,178 7.650% due 11/01/2018-11/01/2040 (k) 7,559 7,869 7.700% due 03/15/2041 350 370 7.750% due 11/15/2039 978 1,037 7.880% due 12/01/2039-03/01/2041 (k) 13,423 14,078 7.930% due 05/01/2016 1,877 1,909 8.250% due 10/29/2023-01/01/2041 (k) 9,484 9,999 8.378% due 11/07/2012 244 253 ----------- 512,459 ----------- Freddie Mac 1.6% 5.500% due 04/01/2001-04/16/2031 (k) 3,845 3,727 6.000% due 01/01/2011-05/14/2031 (k) 20,510 20,518 6.263% due 12/01/2026 (d) 5,522 5,552 6.500% due 07/01/2001-05/01/2029 (k) 8,801 8,950 6.553% due 11/01/2026 (d) 6,055 6,146 6.732% due 11/01/2028 (d) 20,764 21,238 6.775% due 11/01/2003 63 62 6.903% due 07/01/2025 (d) 5,803 5,959 7.000% due 10/01/2002-05/14/2031 (k) 390,901 395,710 7.250% due 11/01/2008 175 178 7.285% due 09/01/2027 (d) 2,449 2,534 7.500% due 09/01/2001-03/01/2030 (k) 14,822 15,147 7.625% due 06/01/2017 (d) 17 17 7.645% due 05/01/2025 2,374 2,537 7.750% due 04/01/2017 (d) 29 29 7.812% due 07/01/2030 (d) 127,169 133,327 8.000% due 01/01/2002-09/01/2018 (k) 3,511 3,631 8.142% due 04/01/2024 (d) 5,790 5,944 8.250% due 12/01/2002-01/01/2019 (d)(k) 218 224 8.252% due 07/01/2022 (d) 587 598 8.276% due 08/01/2023 (d) 7 7 8.346% due 06/01/2022 (d) 1,006 1,023 8.362% due 06/01/2024 (d) 2,520 2,590 8.364% due 07/01/2023 (d) 452 459 8.365% due 11/01/2023 (d) 96 99 8.368% due 10/01/2023 (d) 729 748 8.375% due 06/01/2024 (d) 1,473 1,509 8.376% due 10/01/2023 (d) 1,339 1,373 8.380% due 09/01/2023 (d) 7,900 8,045 8.390% due 08/01/2023 (d) 7,857 8,084 8.396% due 09/01/2023 (d) 1,142 1,171 8.423% due 04/01/2029 (d) 1,094 1,128 8.424% due 05/01/2023 (d) 650 662 8.434% due 07/01/2023 (d) 1,461 1,475 8.435% due 05/01/2023-08/01/2023 (d)(k) 5,320 5,419 8.445% due 08/01/2023 (d) 835 848 8.451% due 01/01/2024 (d) 398 410 8.458% due 07/01/2024 (d) 1,257 1,291 8.500% due 09/01/2001-06/01/2030 (k) 3,567 3,728 8.545% due 08/01/2024 (d) 167 172 8.567% due 05/01/2023 (d) 1,582 1,621 8.575% due 01/01/2024 (d) 348 360 8.584% due 09/01/2023 (d) 2,072 2,113 8.626% due 08/01/2023 (d) 315 318 8.651% due 09/01/2023 (d) 1,032 1,036 8.665% due 12/01/2023 (d) 1,068 1,105 8.667% due 10/01/2023 (d) 1,298 1,334 8.670% due 04/01/2023 (d) 321 329 8.750% due 01/01/2007-12/01/2010 (k) 57 60 8.834% due 11/01/2023 (d) 345 346 8.937% due 10/01/2023 (d) 267 269 8.980% due 11/01/2023 (d) 142 141 9.000% due 01/01/2002-05/01/2017 (k) 407 424 9.006% due 10/01/2023 (d) 954 962 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 103 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- 9.111% due 11/01/2023 (d) $ 258 $ 260 9.250% due 06/01/2009-11/01/2013 (k) 70 73 9.500% due 08/01/2001-12/01/2022 (k) 1,286 1,352 9.750% due 11/01/2004-05/01/2009 (k) 35 36 10.000% due 06/01/2004-03/01/2021 (k) 762 810 10.250% due 04/01/2009-05/01/2009 (k) 991 1,086 10.500% due 10/01/2017-01/01/2021 (k) 345 385 10.750% due 09/01/2010 34 38 11.000% due 11/01/2009-05/01/2020 (k) 570 634 11.250% due 10/01/2009-09/01/2015 (k) 20 22 11.500% due 01/01/2018 63 70 12.500% due 12/01/2012 15 17 13.250% due 10/01/2013 79 93 14.000% due 04/01/2016 15 18 15.500% due 08/01/2011-11/01/2011 (k) 12 15 16.250% due 05/01/2011 3 3 ----------- 687,599 ----------- Government National Mortgage Association 41.7% 5.000% due 06/20/2022-06/20/2026 (d)(k) 974 989 5.500% due 06/20/2026-04/23/2031 (d)(k) 21,909 20,932 5.650% due 10/15/2012 11 10 6.000% due 10/15/2008-04/23/2031 (d)(k) 2,727,913 2,684,181 6.375% due 05/20/2026-05/20/2027 (d)(k) 3,457 3,507 6.500% due 10/15/2008-09/15/2040 (d)(k) 8,375,660 8,373,036 6.625% due 01/15/2040 9,588 9,720 6.670% due 10/15/2001-07/16/2038 (k) 961 958 6.750% due 07/15/2001-07/20/2024 (d)(k) 18,347 18,466 6.800% due 05/15/2040 2,988 2,963 6.820% due 04/15/2040 16,932 16,804 6.875% due 02/20/2016-02/15/2040 (d)(k) 1,171 1,200 7.000% due 10/15/2001-01/03/2041 (d)(k) 5,059,234 5,134,389 7.125% due 10/20/2019-11/20/2027 (d)(k) 35,952 36,851 7.250% due 08/20/2024 (d) 281 286 7.375% due 05/20/2017-05/20/2028 (d)(k) 514,296 522,113 7.500% due 01/15/2003-01/15/2031 (k) 127,981 131,280 7.625% due 12/20/2017-12/20/2027 (d)(k) 306,342 314,014 7.700% due 02/15/2002 6,403 6,764 7.750% due 07/15/2001-09/20/2027 (d)(k) 359,978 368,770 7.875% due 04/20/2023 (d) 270 275 8.000% due 08/15/2005-09/15/2030 (k) 12,494 12,930 8.125% due 07/15/2001-12/01/2039 (k) 3,680 3,994 8.250% due 08/15/2004-08/20/2027 (d)(k) 1,178 1,227 8.500% due 06/15/2001-04/23/2031 (k) 8,672 8,985 8.750% due 03/15/2007-07/15/2007 (k) 87 92 9.000% due 06/15/2001-07/20/2022 (k) 5,286 5,640 9.250% due 07/15/2003-12/20/2016 (k) 137 144 9.500% due 12/15/2003-08/15/2023 (k) 4,093 4,424 9.750% due 09/15/2002-07/15/2004 (k) 67 70 10.000% due 08/20/2004-02/15/2025 (k) 4,771 5,261 10.250% due 02/20/2019 22 24 10.500% due 06/15/2004-09/15/2021 (k) 614 668 11.000% due 05/15/2004-03/15/2019 (k) 181 199 11.250% due 12/20/2015 33 36 11.500% due 10/15/2010-10/15/2015 (k) 85 94 12.000% due 11/15/2012-05/15/2016 (k) 205 238 12.500% due 01/15/2011 1 1 13.000% due 12/15/2012-10/15/2014 (k) 16 20 13.250% due 10/20/2014 19 22 13.500% due 10/15/2012-09/15/2014 (k) 72 84 15.000% due 02/15/2012-10/15/2012 (k) 92 110 16.000% due 10/15/2011-05/15/2012 (k) 191 231 17.000% due 11/15/2011-12/15/2011 (k) 58 68 ----------- 17,692,070 ----------- Stripped Mortgage-Backed Securities 0.0% Bear Stearns Mortgage Securities, Inc. (IO) 7.200% due 07/25/2024 257 14 Chase Mortgage Finance Corp. (IO) 9.000% due 08/25/2023 142 2 Collateralized Mortgage Obligation Trust (PO) 0.000% due 04/23/2017 11 9 Fannie Mae (IO) 6.500% due 05/25/2005 574 48 6.500% due 07/25/2006 248 6 727.220% due 09/25/2006 2 6 6.500% due 02/25/2007 771 30 6.500% due 07/25/2007 137 4 6.500% due 09/25/2007 1,025 45 6.500% due 10/25/2007 281 12 0.100% due 03/25/2009 (d) 20,167 319 6.500% due 08/25/2020 2,064 114 1007.000% due 01/25/2021 0 1 7.500% due 04/25/2021 1,308 153 903.213% due 08/25/2021 5 114 0.950% due 11/25/2021 (d) 19,264 270 6.500% due 10/25/2022 90 8 6.500% due 01/25/2023 2,441 355 3.663% due 02/25/2023 (d) 10,735 715 Fannie Mae (PO) 0.000% due 09/01/2007 588 527 0.000% due 06/25/2022 110 109 0.000% due 08/25/2023 295 241 Freddie Mac (IO) 5.750% due 09/15/2007 (d) 4,517 334 6.000% due 10/15/2007 138 8 6.000% due 01/15/2008 49 2 5.428% due 02/15/2008 (d) 466 31 7.000% due 08/15/2008 2,633 263 6.400% due 10/15/2008 42 5 7.000% due 04/15/2018 414 7 6.500% due 10/15/2018 266 8 8.845% due 01/15/2021 2 23 9.000% due 05/15/2022 85 15 6.500% due 09/15/2023 231 26 Paine Webber CMO Trust (IO) 1359.500% due 08/01/2019 1 27 Vendee Mortgage Trust (IO) 0.542% due 06/15/2023 (d) 141,532 2,541 ----------- 6,392 ----------- Total Mortgage-Backed Securities 32,581,103 (Cost $32,294,094) ----------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 6.7% -------------------------------------------------------------------------------- Aames Mortgage Trust 5.524% due 06/15/2027 437 436 7.119% due 11/25/2030 (d) 43,424 43,537 ABFS Equipment Contract Trust 6.100% due 10/15/2005 54 53 ABSC Long Beach Home Equity Loan Trust 6.436% due 07/21/2030 (d) 375 377 6.096% due 08/21/2030 (d) 127,449 127,589 Accredited Mortgage Loan Trust 5.850% due 02/25/2030 (d) 45,106 45,206 Ace Securities Corp. 6.940% due 11/25/2028 (d) 1,230 1,233 Advanta Mortgage Loan Trust 5.263% due 05/25/2027 (d) 667 664 6.114% due 08/25/2029 (d) 2,307 2,316 5.425% due 11/25/2029 (d) 1,586 1,588 8.250% due 08/25/2030 7,954 8,371 Advanta Revolving Home Equity Loan Trust 6.988% due 01/25/2024 (d) 22,049 22,123 6.868% due 08/25/2024 (d) 20,049 20,047 6.898% due 02/25/2025 (d) 12,535 12,544 Aerco Ltd. 7.089% due 07/15/2025 (d) 38,200 38,258 AESOP Funding II LLC 5.830% due 11/20/2006 (d) 15,500 15,418 AFC Home Equity Loan Trust 7.808% due 10/25/2026 (d) 3 3 American Express Credit Account Master Trust 6.800% due 12/15/2003 1,500 1,505 American Express Master Trust 7.850% due 08/15/2005 220 237 American Stores Co. 6.899% due 08/30/2004 20,000 19,776 Americredit Automobile Receivable Trust 5.304% due 10/12/2002 1,913 1,915 5.780% due 05/12/2003 43,000 43,222 5.443% due 09/05/2006 (d) 5,000 5,017 104 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Ameriquest Mortgage Securities, Inc. 5.889% due 06/15/2030 $ 12,168 $ 12,196 Amresco Residential Securities Mortgage Loan Trust 6.775% due 05/25/2028 (d) 1,661 1,662 Arcadia Automobile Receivables Trust 6.250% due 09/15/2002 4,773 4,781 6.300% due 07/15/2003 25,821 25,982 6.900% due 12/15/2003 20,519 20,838 Associates Manufactured Housing 7.000% due 03/15/2027 1,492 1,499 Banc One Heloc Trust 6.880% due 04/20/2020 (d) 38,373 38,390 Banc One Home Equity Trust 6.460% due 06/25/2029 2,333 2,327 BankBoston Home Equity Loan Trust 6.280% due 11/25/2010 6 6 Bayview Financial Acquisition Trust 7.170% due 02/25/2029 (d) 4,308 4,328 6.130% due 11/25/2029 (d) 10,626 10,626 7.002% due 02/25/2030 (d) 20,512 20,519 5.920% due 07/25/2030 (d) 61,806 61,806 5.920% due 11/25/2030 (d) 42,300 42,300 BMCA Receivables Master Trust 6.840% due 09/20/2002 (d) 12,000 11,993 Brazos Student Loan Finance Co. 6.190% due 06/01/2023 (d) 55,700 55,576 7.170% due 12/01/2025 (d) 36,780 36,554 Capital Asset Research Funding LP 6.400% due 12/15/2004 207 210 5.905% due 12/15/2005 125 125 Captec Franchise Trust 7.892% due 10/15/2010 1,291 1,344 Champion Home Equity Loan Trust 6.908% due 03/25/2029 (d) 4,285 4,285 5.930% due 09/25/2029 13,214 13,238 Charming Shoppes Master Trust 7.069% due 08/15/2008 (d) 250 251 Chase Credit Card Master Trust 6.660% due 01/15/2007 645 674 Chase Funding Mortgage Loan Asset-Backed Certificates 6.840% due 10/25/2030 (d) 54,966 54,963 Chase Manhattan Grantor Trust 6.610% due 09/15/2002 214 215 Community Program Loan Trust 4.500% due 10/01/2018 23,416 22,120 4.500% due 04/01/2029 26,000 21,474 Compucredit Credit Card Master Trust 5.789% due 03/15/2007 (d) 16,000 16,000 Conseco Finance 7.520% due 05/15/2014 23,994 24,286 7.800% due 05/15/2020 175 185 5.534% due 10/15/2031 (d) 27,148 27,244 Conseco Finance Home Loan Trust 6.980% due 06/15/2011 12,305 12,409 8.080% due 02/15/2022 20,300 21,326 Conseco Finance Lease LLC 7.250% due 04/20/2003 25,500 25,772 Conseco Finance Securitizations Corp. 8.850% due 12/01/2030 20,000 22,451 7.180% due 05/01/2032 18,072 18,303 7.970% due 05/01/2032 25,600 26,956 8.310% due 05/01/2032 48,800 52,721 Contimortgage Home Equity Loan Trust 6.420% due 04/25/2014 63 63 6.400% due 06/15/2014 489 489 6.770% due 01/25/2018 41,700 42,221 6.990% due 03/15/2021 350 356 6.930% due 11/25/2022 36,800 37,783 7.220% due 01/15/2028 80 82 6.760% due 06/15/2028 (d) 1,607 1,603 6.829% due 08/15/2028 (d) 243 243 CPS Auto Trust 6.000% due 08/15/2003 53 53 Cross Country Master Credit Card Trust II 7.210% due 06/15/2006 (d) 800 807 CS First Boston Mortgage Securities Corp. 6.750% due 09/25/2028 6,960 6,946 Daimler-Benz Auto Grantor Trust 6.050% due 03/31/2005 1,063 1,064 Delta Funding Home Equity Loan Trust 6.140% due 03/15/2018 13,888 13,902 7.029% due 09/15/2029 (d) 9,603 9,643 6.940% due 06/15/2030 (d) 31,426 31,425 Denver Arena Trust 6.940% due 11/15/2019 272 261 Discover Card Master Trust I 6.996% due 10/16/2013 (d) 400 404 Duck Auto Grantor Trust 5.650% due 03/15/2004 2,361 2,369 7.260% due 05/15/2005 30,542 30,607 Embarcadero Aircraft Securitization Trust 5.644% due 08/15/2025 (d) 11,000 11,000 EQCC Home Equity Loan Trust 6.050% due 01/25/2010 68 68 6.548% due 04/25/2010 201 201 5.770% due 05/20/2010 68 68 6.780% due 10/15/2027 (d) 641 640 Equivantage Home Equity Loan Trust 6.550% due 10/25/2025 70 71 First Alliance Mortgage Loan Trust 6.154% due 01/25/2025 (d) 533 534 5.960% due 03/20/2031 (d) 11,816 11,831 First Omni Bank Credit Card Master Trust 6.650% due 09/15/2003 (d) 1,500 1,502 First Security Auto Grantor Trust 5.970% due 04/15/2004 82 83 FMAC Loan Receivables Trust 7.900% due 04/15/2019 20 21 6.200% due 09/15/2020 133 134 6.500% due 09/15/2020 209 195 6.830% due 09/15/2020 680 657 Ford Credit Auto Owner Trust 6.200% due 04/15/2002 153 153 GE Capital Equipment Lease Trust 6.850% due 05/20/2008 (d) 250 255 GMAC Mortgage Corp. Loan Trust 7.089% due 11/18/2025 (d) 38,438 38,586 7.950% due 03/25/2030 34,303 34,901 Green Tree Financial Corp. 5.760% due 11/01/2018 145 142 8.400% due 06/15/2025 152 153 7.150% due 07/15/2027 24 24 6.490% due 03/15/2028 24,774 25,047 6.420% due 11/15/2028 786 791 6.870% due 02/01/2030 1,620 1,543 6.660% due 06/01/2030 1,405 1,284 5.600% due 12/01/2030 115 115 6.480% due 12/01/2030 55 53 5.510% due 02/01/2031 69 69 7.860% due 04/01/2031 400 410 Green Tree Floorplan Receivables Master Trust 5.921% due 11/15/2004 (d) 46,000 46,014 Green Tree Home Improvement Loan Trust 7.270% due 11/15/2029 (d) 2,649 2,643 Green Tree Recreational, Equipment, & Consumables 6.430% due 04/17/2006 2,035 2,054 6.715% due 02/01/2009 30,412 30,875 6.490% due 02/15/2018 13 13 6.180% due 06/15/2019 184 187 Greenpoint Manufactured Housing 7.270% due 06/15/2029 110 108 Harley-Davidson Eaglemark Motorcycle Trust 5.250% due 07/15/2003 43 43 Headlands Home Equity Loan Trust 5.814% due 12/15/2024 (d) 397 400 HFC Home Equity Loan 6.830% due 12/20/2016 152 152 Household Consumer Loan Trust 7.040% due 08/15/2006 (d) 17,025 16,440 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 105 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- IMC Home Equity Loan Trust 7.497% due 07/25/2026 (d) $ 589 $ 603 5.740% due 08/20/2029 141 141 IMPAC Secured Assets CMN Owner Trust 7.770% due 07/25/2025 2,000 2,046 Indymac Home Equity Loan Asset-Backed Trust 6.888% due 10/25/2029 (d) 4,942 4,953 6.912% due 07/25/2030 (d) 9,867 9,883 Indymac Manufactured Housing Contract 6.170% due 12/25/2011 4,190 4,204 Korea National Housing 9.969% due 05/23/2001 3,000 3,015 Long Beach Auto Receivables Trust 6.940% due 09/19/2007 3,322 3,400 Long Beach Mortgage Loan Trust 5.240% due 04/21/2008 (d) 11,486 11,497 Marriott Vacation Club Owner Trust 5.930% due 09/20/2017 (d) 77,038 76,976 Mellon Bank Home Equity 6.520% due 07/25/2010 336 336 5.900% due 10/25/2010 10,932 10,955 Merit Securities Corp. 6.160% due 07/28/2033 4,398 4,398 7.880% due 12/28/2033 34,400 35,646 Metris Master Trust 5.658% due 04/20/2006 (d) 20,000 20,143 Metropolitan Asset Funding, Inc. 7.081% due 04/25/2029 (d) 12,231 12,063 Mid-State Trust 8.330% due 04/01/2030 58,707 63,259 MLCC Mortgage Investors, Inc. 5.949% due 03/15/2025 (d) 364 365 MMCA Automobile Trust 6.300% due 06/15/2002 110 110 Morgan Stanley ABS Capital, Inc. 6.930% due 08/25/2030 (d) 143,211 143,479 MPC Natural Gas Funding Trust 6.200% due 03/15/2013 9,316 9,680 MSDWCC Heloc Trust 6.908% due 09/25/2010 (d) 35,556 35,457 Myra-United Mexican States 6.438% due 10/20/2006 (d) 378 366 6.373% due 12/23/2006 1,275 1,237 6.488% due 12/23/2006 (d) 7,051 6,840 7.500% due 12/23/2006 (d) 5,343 5,181 7.750% due 12/23/2006 (d) 3,208 3,111 5.688% due 12/23/2006 (d) 851 826 National Medical Care 6.625% due 09/30/2003 (d) 19,315 19,121 6.313% due 09/30/2003 11,381 11,267 New Holland Equipment Receivables Trust 6.390% due 10/15/2002 84 85 New York City Tax Lien 6.460% due 05/25/2005 87 87 NPF VI, Inc. 6.220% due 06/01/2002 17,150 16,941 NPF XII, Inc. 7.050% due 06/01/2003 50,750 51,495 5.931% due 11/01/2003 (d) 16,000 16,000 Option One Mortgage Loan Trust 5.880% due 05/25/2029 32 32 5.340% due 09/25/2030 (d) 47,572 47,650 Provident Bank Equipment Lease Trust 5.830% due 11/25/2011 (d) 36,372 36,372 Provident Bank Home Equity Loan Trust 6.920% due 06/25/2021 (d) 32,539 32,597 Providian Gateway Master Trust 5.380% due 03/15/2007 28,900 28,900 5.849% due 03/16/2009 (d) 23,000 23,000 Providian Master Trust 6.250% due 06/15/2007 25 26 PSB Lending Home Loan Owner Trust 6.830% due 05/20/2018 3,272 3,296 Residential Asset Mortgage Products, Inc. 6.004% due 09/25/2030 (d) 41,721 41,521 7.980% due 12/25/2030 24,463 25,541 Residential Asset Securities Corp. 6.720% due 04/25/2014 (d) 79 79 6.960% due 07/25/2014 12,477 12,478 6.240% due 02/25/2017 902 901 6.600% due 01/25/2020 13,200 13,311 7.075% due 09/25/2020 190 193 8.000% due 09/25/2021 (d) 5,060 5,210 6.920% due 10/25/2027 (d) 1,677 1,688 Residential Asset Securitization Trust 6.750% due 03/25/2028 40,000 39,683 Residential Funding Mortgage Securities, Inc. 10.836% due 06/01/2001 72,450 72,450 RJR Nabisco 7.500% due 01/01/2002 (d) 19,948 19,948 Ryder Vehicle Lease Trust 6.430% due 01/15/2003 406 407 SallieMae 5.936% due 04/25/2004 (d) 3,049 3,053 6.824% due 07/25/2004 (d) 832 831 5.901% due 10/25/2005 (d) 18,203 18,205 6.825% due 10/25/2005 (d) 11,476 11,468 6.628% due 04/25/2006 (d) 69,553 69,441 Salomon Brothers Mortgage Securities VII 7.020% due 09/25/2029 (d)(i) 330 331 5.584% due 11/15/2029 (d) 17,045 17,117 6.463% due 11/15/2029 (d)(i) 7,800 7,823 Saxon Asset Securities Trust 7.585% due 12/25/2014 45 45 5.760% due 05/25/2029 (d) 5,946 5,950 Sears Credit Account Master Trust 6.050% due 01/15/2008 500 512 Southern Pacific Secured Assets Corp. 5.700% due07/25/2029 (d) 39,146 39,035 Standard Credit Card Master Trust 8.250% due 11/07/2003 80 82 Team Fleet Financing Corp. 7.350% due 05/15/2003 30 31 The Money Store Home Equity Trust 7.550% due 02/15/2020 196 197 6.345% due 11/15/2021 479 480 6.490% due 10/15/2026 10,354 10,495 Toyota Auto Lease Trust 6.450% due 04/26/2004 300 300 UCFC Home Equity Loan 8.200% due 09/15/2027 70 72 6.870% due 07/15/2029 70 69 UCFC Manufactured Housing Contract 6.680% due 01/15/2010 (d) 1,785 1,786 UniCapital Equipment Contract 6.540% due 07/23/2002 8,657 8,665 USAA Auto Loan Grantor Trust 6.150% due 05/15/2004 651 650 5.800% due 01/15/2005 1,772 1,784 WFS Financial Owner Trust 6.411% due 07/20/2002 7,817 7,829 6.920% due 01/20/2004 27,125 27,631 WMC Mortgage Loan 7.070% due 10/15/2029 74,741 74,787 ----------- Total Asset-Backed Securities 2,838,269 (Cost $2,818,838) ----------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 1.2% -------------------------------------------------------------------------------- Hellenic Republic 6.938% due 06/06/2001 (d) 20,000 20,026 Hydro-Quebec 7.375% due 02/01/2003 150 156 6.875% due 09/29/2049 (d) 2,000 1,787 Kingdom of Jordan 6.000% due 12/23/2023 7,000 5,330 Kingdom of Sweden 10.250% due 11/01/2015 500 647 Province of Manitoba 7.750% due 02/01/2002 1,000 1,023 106 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Province of New Brunswick 7.125% due 10/01/2002 $ 1,700 $ 1,752 Province of Newfoundland 9.000% due 06/01/2019 500 643 Province of Nova Scotia 9.375% due 07/15/2002 1,000 1,056 Province of Ontario 7.750% due 06/04/2002 200 207 7.625% due 06/22/2004 1,000 1,068 7.000% due 08/04/2005 1,000 1,065 6.000% due 02/21/2006 1,800 1,846 5.500% due 10/01/2008 12,000 11,898 Province of Quebec 7.500% due 07/15/2002 6,000 6,206 8.800% due 04/15/2003 1,100 1,184 6.810% due 06/11/2004 (d) 15,500 15,501 6.500% due 01/17/2006 2,000 2,091 6.620% due 04/09/2026 25,000 26,560 Republic of Argentina 5.563% due 03/31/2005 (d) 28,800 24,774 Republic of Brazil 7.625% due 04/15/2006 241,286 218,699 10.125% due 05/15/2027 14,000 10,640 Republic of Bulgaria 3.000% due 07/28/2012 (d) 3,624 2,744 7.750% due 07/28/2024 (d) 320 239 Republic of Croatia 7.000% due 02/27/2002 7,650 7,665 7.750% due 07/31/2006 (d) 2,911 2,846 6.250% due 07/31/2010 (d) 31,750 30,718 Republic of Kazakhstan 8.375% due 10/02/2002 5,000 5,104 Republic of Panama 7.875% due 02/13/2002 1,850 1,866 7.733% due 05/10/2002 (d) 1,975 1,991 4.500% due 07/17/2014 7,675 6,470 Republic of Peru 3.750% due 03/07/2017 3,000 1,868 4.500% due 03/07/2017 (d) 5,750 3,924 3.750% due 03/07/2017 8,000 5,002 Republic of Poland 6.000% due 10/27/2014 9,000 8,764 3.500% due 10/27/2024 (d) 53,940 38,972 4.250% due 10/27/2024 1,600 1,268 Republic of South Africa 9.125% due 05/19/2009 15,000 15,788 State of Israel 6.200% due 06/14/2003 25 25 United Kingdom Gilt 8.000% due 09/27/2013 (j) 1,900 3,497 United Mexican States 9.616% due 04/07/2004 (d) 14,436 14,833 8.500% due 02/01/2006 3,781 3,866 6.250% due 12/31/2019 8,860 7,907 ----------- Total Sovereign Issues 519,516 (Cost $515,566) ----------- -------------------------------------------------------------------------------- FOREIGN CURRENCY-DENOMINATED ISSUES (f)(g) 3.1% -------------------------------------------------------------------------------- Canada Treasury Bill 0.000% due 04/12/2001 C$ 20 13 0.000% due 05/10/2001 220 139 Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 73,000 32,372 Halifax Group Euro Finance 7.627% due 12/29/2049 EC 8,500 7,863 KBC Bank Fund Trust IV 8.220% due 11/29/2049 20,764 19,154 Korea Development Bank 4.885% due 05/14/2001 DM 70,000 31,365 2.560% due 06/26/2001 JY 4,000,000 31,889 Korea Electric Power Corp. 3.882% due 10/31/2002 (d) DM 18,900 8,390 Lloyds TSB Capital 7.375% due 02/07/2049 EC 16,000 14,731 Newcourt Credit Group, Inc. 7.625% due 06/28/2001 C$ 9,400 5,987 Republic of Austria 5.500% due 01/15/2010 (j) EC 900 817 Republic of Brazil 8.250% due 11/26/2001 2,000 1,772 Republic of Germany 5.000% due 05/20/2005 155 139 4.125% due 07/04/2008 (j) 15,500 13,205 4.500% due 07/04/2009 (j) 71,300 62,023 5.375% due 01/04/2010 (j) 35,300 32,476 5.250% due 07/04/2010 156,560 143,007 5.250% due 01/04/2011 (j) 294,780 269,108 6.250% due 01/04/2024 (j) 128,451 125,373 6.500% due 07/04/2027 (j) 198,710 200,816 5.600% due 01/04/2028 (j) 108,710 98,594 6.250% due 01/04/2030 (j) 100 99 Royal Bank of Scotland Group PLC 8.300% due 03/31/2049 BP 85,000 103,104 Treuhandanstalt 6.250% due 03/04/2004 EC 60 55 United Mexican States 6.000% due 03/28/2002 JY 100,000 830 3.100% due 04/24/2002 2,542,000 20,470 8.750% due 05/30/2002 BP 23,000 33,184 10.375% due 01/29/2003 DM 200 95 7.000% due 06/02/2003 C$ 30,200 19,158 7.432% due 04/07/2004 (d) EC 18,181 16,223 6.750% due 06/06/2006 JY 2,000,000 18,678 7.500% due 03/08/2010 EC 5,000 4,341 1.103% due 12/31/2019 (d) JY 1,662,500 12,936 ----------- Total Foreign Currency-Denominated Issues 1,328,406 (Cost $1,374,968) ----------- -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- General National Mortgage Association (OTC) 6.000% due 05/21/2031 Strike @ 90.281 Exp. 05/04/2001 $ 497,000 1 General National Mortgage Association (OTC) 7.500% due 05/21/2031 Strike @ 96.641 Exp. 05/04/2001 940,000 2 Harborview Mortgage Loan Trust (OTC) 7.470% due 08/19/2030 Strike @ 100.000 Exp. 05/01/2005 22,975 0 ----------- Total Purchased Put Options 3 (Cost $112) ----------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 0.0% -------------------------------------------------------------------------------- Banking & Finance 0.0% Bell Atlantic Financial Services 5.750% due 04/01/2003 1,500 1,505 Cox Communications, Inc. 0.426% due 04/19/2020 25 10,063 ----------- Total Convertible Bonds & Notes 11,568 (Cost $14,839) ----------- -------------------------------------------------------------------------------- PREFERRED SECURITY 0.8% -------------------------------------------------------------------------------- Shares DG Funding Trust 7.150% due 12/29/2049 (d) 35,150 358,530 ----------- Total Preferred Security 358,530 (Cost $351,502) ----------- See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 107 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Value Shares (000s) -------------------------------------------------------------------------------- PREFERRED STOCK 0.2% -------------------------------------------------------------------------------- Banco Bilbao Vizcaya International 9.750% due 12/31/2049 266,217 $ 6,909 Centaur Funding Corp. 9.080% due 04/21/2020 125 131 CSC Holdings, Inc. 11.125% due 04/01/2008 27,038 2,947 Fortis Amev NV 6.430% due 12/31/2049 85 11,220 5.080% due 12/31/2049 (d) 86 11,352 Home Ownership Funding 13.331% due 12/31/2049 1,125 849 SI Financing Trust I 9.500% due 06/30/2026 396,194 10,024 TCI Communications, Inc. 9.720% due 12/31/2036 622,553 15,844 10.000% due 05/31/2045 49,000 1,230 ----------- Total Preferred Stock 60,506 (Cost $60,018) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 11.8% -------------------------------------------------------------------------------- Principal Amount (000s) Certificates of Deposit 0.1% Mexico Credit Link 11.384% due 02/22/2002 $ 29,500 30,247 11.804% due 02/25/2002 2,000 2,088 ----------- 32,335 ----------- Commercial Paper 11.2% Abbey National North America 5.500% due 04/10/2001 31,500 31,462 5.090% due 04/19/2001 2,400 2,394 5.340% due 04/19/2001 1,500 1,496 5.350% due 04/19/2001 6,800 6,783 5.450% due 04/19/2001 1,100 1,097 5.420% due 04/26/2001 2,200 2,192 5.345% due 05/02/2001 126,400 125,837 5.050% due 08/01/2001 2,000 1,967 5.060% due 08/01/2001 1,000 984 4.930% due 08/01/2001 35,000 34,426 5.010% due 08/06/2001 700 688 5.040% due 08/06/2001 41,800 41,089 5.020% due 08/07/2001 74,200 72,928 5.050% due 08/08/2001 3,700 3,636 5.040% due 08/08/2001 600 590 5.020% due 08/08/2001 6,700 6,584 5.010% due 08/08/2001 17,100 16,805 Abbey National PLC 5.240% due 04/10/2001 200 200 4.870% due 05/02/2001 16,800 16,732 5.070% due 05/02/2001 2,100 2,091 4.700% due 09/05/2001 3,500 3,428 4.710% due 09/06/2001 16,800 16,451 Abbott Laboratories 5.100% due 04/05/2001 19,600 19,592 ABN Amro North America Finance, Inc. 5.340% due 04/02/2001 600 600 Alcoa, Inc. 5.310% due 04/02/2001 11,300 11,300 5.300% due 04/10/2001 40,000 39,953 5.170% due 04/11/2001 800 799 5.300% due 04/20/2001 439 438 5.170% due 04/25/2001 300 299 American Express Co. 5.150% due 04/04/2001 169,700 169,651 5.240% due 04/04/2001 1,000 1,000 5.300% due 04/04/2001 32,500 32,490 5.320% due 04/04/2001 49,400 49,385 5.620% due 04/06/2001 3,700 3,698 6.240% due 04/06/2001 2,600 2,598 5.490% due 04/06/2001 800 800 5.410% due 04/06/2001 300 300 6.360% due 04/06/2001 600 600 4.950% due 04/27/2001 100 100 4.840% due 05/15/2001 8,000 7,954 4.860% due 05/15/2001 4,900 4,872 Anz, Inc. 5.410% due 04/18/2001 3,400 3,392 Becton Dickinson & Co. 5.250% due 04/11/2001 2,400 2,397 6.110% due 04/25/2001 2,200 2,191 5.350% due 04/25/2001 23 23 4.920% due 06/20/2001 400 396 4.940% due 07/25/2001 1,500 1,477 4.800% due 07/25/2001 5,300 5,218 Bellsouth Capital Funding Corp. 5.340% due 04/11/2001 32,300 32,257 Campbell Soup Co. 5.440% due 04/16/2001 200 200 CBA (de) Finance 5.340% due 04/11/2001 3,900 3,895 4.960% due 04/23/2001 19,300 19,244 4.990% due 04/23/2001 6,300 6,282 5.040% due 04/23/2001 100 100 5.020% due 08/09/2001 1,800 1,769 5.040% due 08/09/2001 3,400 3,339 CDC 5.130% due 04/25/2001 1,000 997 5.460% due 04/25/2001 600 598 Coca-Cola Co. 5.100% due 04/02/2001 3,300 3,300 4.990% due 04/12/2001 100 100 5.080% due 04/12/2001 4,400 4,394 4.580% due 07/12/2001 500 493 4.600% due 07/12/2001 2,500 2,465 E.I. Du Pont 5.170% due 04/05/2001 27,500 27,480 Executive Jet, Inc. 4.940% due 04/18/2001 1,900 1,896 4.960% due 04/25/2001 15,350 15,301 4.960% due 04/27/2001 10,000 9,966 5.330% due 05/23/2001 1,200 1,191 4.860% due 06/27/2001 10,000 9,884 5.280% due 06/27/2001 6,600 6,523 4.970% due 08/01/2001 35,000 34,426 5.040% due 08/08/2001 3,100 3,046 5.030% due 08/08/2001 9,000 8,845 Exxon Mobil 5.390% due 04/04/2001 2,700 2,699 5.140% due 04/04/2001 5,500 5,498 Fannie Mae 5.810% due 05/24/2001 5,300 5,256 4.890% due 06/07/2001 400 396 4.720% due 08/15/2001 40,600 39,864 4.685% due 09/06/2001 19,300 18,899 Federal Farm Credit Bank 4.630% due 08/29/2001 3,000 2,941 4.650% due 08/29/2001 8,500 8,332 Federal Home Loan Bank 4.980% due 04/05/2001 50,000 49,987 4.910% due 05/11/2001 326 324 4.675% due 09/07/2001 5,200 5,092 Freddie Mac 4.980% due 04/02/2001 17,900 17,893 4.950% due 04/03/2001 2,000 2,000 5.250% due 04/17/2001 263 262 5.320% due 04/26/2001 3,000 2,989 6.320% due 04/26/2001 325 324 4.700% due 05/16/2001 72,500 72,084 Gannett Co. 4.990% due 04/11/2001 56,400 56,330 5.090% due 04/11/2001 8,500 8,489 5.000% due 04/20/2001 34,100 34,015 108 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- General Electric Capital Corp. 5.200% due 04/03/2001 $ 45,300 $ 45,293 5.090% due 04/03/2001 800 800 4.990% due 04/03/2001 200 199 5.410% due 04/03/2001 6,400 6,399 4.970% due 04/04/2001 3,700 3,699 4.990% due 04/04/2001 800 800 5.170% due 04/04/2001 300 300 5.350% due 04/04/2001 6,700 6,698 5.370% due 04/04/2001 4,400 4,399 5.390% due 04/04/2001 6,800 6,798 5.480% due 04/05/2001 2,900 2,899 5.440% due 04/18/2001 400 398 5.200% due 04/18/2001 1,600 1,596 5.190% due 04/18/2001 1,100 1,098 4.980% due 04/25/2001 2,300 2,293 5.450% due 04/25/2001 500 498 5.370% due 04/25/2001 3,000 2,990 5.330% due 04/25/2001 3,300 3,289 5.320% due 04/25/2001 11,500 11,461 5.470% due 04/25/2001 60,400 60,189 5.020% due 04/25/2001 1,000 997 4.940% due 04/25/2001 1,600 1,594 4.900% due 04/25/2001 54,200 54,030 0.040% due 04/25/2001 3,000 2,990 5.090% due 04/25/2001 1,500 1,495 5.180% due 04/25/2001 1,800 1,794 5.350% due 05/09/2001 53,500 53,206 4.690% due 05/30/2001 1,000 992 5.480% due 05/30/2001 5,000 4,959 5.340% due 05/30/2001 4,700 4,661 4.940% due 05/30/2001 200 198 4.780% due 05/30/2001 300 298 4.870% due 05/30/2001 3,000 2,975 5.310% due 06/06/2001 1,300 1,288 5.520% due 06/06/2001 4,200 4,162 5.340% due 06/06/2001 1,300 1,288 5.140% due 06/06/2001 7,800 7,729 5.130% due 06/06/2001 2,400 2,378 5.920% due 06/06/2001 32,900 32,601 5.220% due 06/06/2001 900 892 4.600% due 07/18/2001 3,300 3,255 5.000% due 08/15/2001 200 196 4.930% due 08/22/2001 83,000 81,425 Gillette Co. 5.060% due 04/17/2001 200 200 5.440% due 04/17/2001 9,400 9,379 4.910% due 08/21/2001 1,100 1,079 Glaxo Wellcome 4.970% due 04/30/2001 79,500 79,193 Goldman Sachs Group 4.540% due 09/19/2001 100 98 Halifax Building Society 5.220% due 04/18/2001 300 299 5.350% due 04/18/2001 14,400 14,366 5.370% due 04/18/2001 2,300 2,295 5.390% due 04/18/2001 4,100 4,090 5.480% due 04/18/2001 4,800 4,788 5.010% due 05/30/2001 1,200 1,190 4.950% due 08/01/2001 35,800 35,213 5.000% due 08/02/2001 25,000 24,587 5.080% due 08/08/2001 3,500 3,437 5.050% due 08/08/2001 2,900 2,850 4.700% due 09/04/2001 11,000 10,774 Heinz Corp. 4.890% due 05/01/2001 1,200 1,195 KFW International Finance, Inc. 5.090% due 04/23/2001 3,800 3,789 5.340% due 04/24/2001 2,200 2,193 5.320% due 05/30/2001 1,500 1,488 4.910% due 05/30/2001 4,100 4,066 5.270% due 05/30/2001 4,300 4,265 5.820% due 06/06/2001 20,000 19,818 5.260% due 06/06/2001 200 198 5.460% due 06/06/2001 4,000 3,964 4.930% due 07/30/2001 40,000 39,354 5.000% due 08/08/2001 3,700 3,636 5.010% due 08/08/2001 1,200 1,179 5.070% due 08/08/2001 1,200 1,179 Monsanto Co. 5.210% due 04/11/2001 1,000 999 4.970% due 08/08/2001 1,100 1,081 4.980% due 08/15/2001 2,000 1,963 4.650% due 08/16/2001 2,200 2,160 4.920% due 08/16/2001 6,650 6,529 4.800% due 08/27/2001 40,000 39,217 5.020% due 08/29/2001 20,000 19,604 Morgan Stanley Group, Inc. 5.050% due 04/11/2001 175,100 174,879 4.950% due 04/25/2001 500 498 Motorola, Inc. 6.210% due 04/20/2001 200 199 National Australia Funding 5.070% due 04/04/2001 2,123 2,122 5.100% due 04/05/2001 184,900 184,821 National Rural Utilities Cooperative Finance Corp. 5.190% due 04/11/2001 4,100 4,095 5.140% due 04/11/2001 5,100 5,093 4.870% due 04/11/2001 5,200 5,194 4.940% due 04/11/2001 1,600 1,598 4.920% due 04/17/2001 4,700 4,690 5.250% due 05/24/2001 190 189 5.340% due 05/24/2001 1,000 992 5.300% due 05/24/2001 2,600 2,580 5.240% due 05/24/2001 1,400 1,389 5.180% due 05/24/2001 300 298 4.820% due 05/24/2001 23,500 23,336 4.810% due 05/24/2001 200 199 5.290% due 05/24/2001 4,500 4,466 4.880% due 05/25/2001 8,900 8,836 4.910% due 05/25/2001 42,000 41,696 4.550% due 08/24/2001 400 393 5.070% due 08/24/2001 2,600 2,547 Reseau Ferre De France 4.590% due 07/25/2001 1,700 1,674 4.620% due 07/25/2001 3,500 3,446 4.620% due 08/16/2001 8,900 8,738 SBC Communications, Inc. 5.300% due 04/03/2001 50,300 50,293 5.330% due 04/04/2001 400 400 5.340% due 04/04/2001 12,000 11,996 5.290% due 04/10/2001 12,400 12,385 5.330% due 04/16/2001 22,000 21,954 Swedbank, Inc. 5.390% due 04/12/2001 2,000 1,997 5.080% due 04/12/2001 980 979 5.370% due 04/12/2001 3,800 3,794 5.160% due 04/23/2001 2,300 2,293 4.930% due 04/25/2001 12,400 12,361 5.140% due 04/25/2001 3,200 3,189 4.860% due 05/30/2001 20,000 19,836 5.010% due 05/30/2001 7,400 7,339 5.290% due 05/30/2001 1,700 1,686 5.340% due 05/30/2001 2,600 2,579 5.370% due 05/30/2001 1,000 992 5.000% due 08/06/2001 12,200 11,992 5.010% due 08/06/2001 12,700 12,484 4.850% due 08/06/2001 2,100 2,064 5.020% due 08/08/2001 23,200 22,799 5.060% due 08/08/2001 4,600 4,521 5.100% due 08/08/2001 6,600 6,486 4.890% due 08/08/2001 1,600 1,572 5.010% due 08/09/2001 27,600 27,120 4.790% due 08/15/2001 8,600 8,444 4.630% due 08/23/2001 1,300 1,275 4.900% due 08/23/2001 6,000 5,885 4.700% due 09/05/2001 1,300 1,273 4.740% due 09/05/2001 14,100 13,809 See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 109 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- UBS Finance, Inc. 0.400% due 04/02/2001 $ 15,000 $ 15,000 5.400% due 04/02/2001 403,600 403,600 5.300% due 04/04/2001 101,000 100,970 5.010% due 04/18/2001 300 299 5.340% due 04/18/2001 4,400 4,389 5.460% due 04/18/2001 1,600 1,595 5.360% due 05/07/2001 20,000 19,832 5.410% due 05/16/2001 3,800 3,774 5.340% due 05/16/2001 16,000 15,895 5.350% due 05/16/2001 4,200 4,172 5.820% due 05/30/2001 273,700 271,453 5.510% due 06/06/2001 9,200 9,116 5.830% due 06/06/2001 1,000 991 5.920% due 06/06/2001 93,600 92,748 5.520% due 06/06/2001 2,900 2,874 5.240% due 06/06/2001 4,300 4,261 5.190% due 06/06/2001 12,000 11,890 5.340% due 06/06/2001 2,300 2,279 4.670% due 06/13/2001 63,000 62,316 4.940% due 06/13/2001 2,200 2,178 4.970% due 06/13/2001 300 297 5.160% due 06/13/2001 7,100 7,029 5.190% due 06/13/2001 2,400 2,376 5.290% due 06/13/2001 125,000 123,753 4.970% due 08/01/2001 57,000 56,065 5.010% due 08/01/2001 35,600 35,016 5.050% due 08/01/2001 1,600 1,574 4.550% due 08/02/2001 2,400 2,360 5.040% due 08/02/2001 42,000 41,305 5.050% due 08/02/2001 5,000 4,917 5.070% due 08/02/2001 9,900 9,730 4.790% due 08/07/2001 100 98 5.030% due 08/07/2001 248,500 244,241 5.030% due 08/08/2001 35,000 34,396 5.070% due 08/08/2001 6,600 6,486 5.040% due 08/08/2001 7,800 7,665 4.900% due 08/08/2001 200 197 5.050% due 08/08/2001 300 295 5.010% due 08/08/2001 29,600 29,089 4.590% due 08/15/2001 2,100 2,062 4.760% due 08/15/2001 1,100 1,080 4.820% due 08/15/2001 3,100 3,044 4.740% due 09/04/2001 125,000 122,435 4.750% due 09/05/2001 6,500 6,366 4.740% due 09/05/2001 9,500 9,304 4.740% due 09/06/2001 44,400 43,478 4.740% due 09/12/2001 65,000 63,604 Verizon Global Funding 5.320% due 04/02/2001 1,700 1,700 5.310% due 04/05/2001 2,600 2,599 5.340% due 04/05/2001 5,300 5,298 4.960% due 05/04/2001 700 697 5.010% due 05/16/2001 4,800 4,771 4.980% due 05/25/2001 400 397 4.750% due 06/15/2001 300 297 Walt Disney Co. 4.690% due 08/07/2001 1,800 1,769 4.900% due 08/07/2001 3,400 3,342 Williams Cos., Inc. 7.231% due 04/10/2001 23,200 23,209 7.231% due 04/10/2001 10,700 10,700 7.231% due 04/10/2001 10,300 10,304 Wisconsin Electric Power & Light 5.040% due 04/12/2001 200 200 5.100% due 04/12/2001 800 799 ----------- 4,774,003 ----------- Repurchase Agreement 0.4% Daiwa Securities 5.150% due 04/02/2001 165,000 165,000 (Dated 03/30/2001. Collateralized by ----------- U.S. Treasury Bills 4.420% due 09/13/2001 valued at $168,527 Repurchase proceeds are $165,071.) U.S. Treasury Bills 0.1% 5.073% due 05/17/2001 (b) 21,685 21,566 ----------- Total Short-Term Instruments 4,992,904 (Cost $4,992,031) ----------- Total Investments (a) 151.2% $64,127,213 (Cost $63,623,558) Written Options (c) (0.1%) (42,637) (Premiums $35,755) Other Assets and Liabilities (Net) (51.1%) (21,679,183) ----------- Net Assets 100.0% $42,405,393 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $63,665,744 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 781,956 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (353,054) ----------- Unrealized appreciation-net $ 428,902 ----------- (b) Securities with an aggregate market value of $246,132 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- Eurodollar March Futures (03/2002) 762 $ 429 Eurodollar June Futures (06/2002) 8,899 1,470 Eurodollar September Futures (09/2002) 8,899 1,289 Eurodollar December Futures (12/2002) 8,899 984 Eurodollar March Futures (03/2003) 8,137 586 Municipal Bond (06/2001) 711 (513) EuroBond 10 Year Note (06/2001) 30,855 30,576 U.S. Treasury 5 Year Note (06/2001) 11,913 (6,762) U.S. Treasury 10 Year Note (06/2001) 219 67 U.S. Treasury 30 Year Bond (06/2001) 26,537 (7,889) Euribor Futures (06/2001) 823 1,454 Euribor Futures (03/2002) 4,117 4,313 Government of Japan 10 Year Note (06/2001) 39 (41) United Kingdom 90 Day LIBOR Futures (03/2002) 275 219 United Kingdom 90 Day LIBOR Futures (06/2002) 275 207 United Kingdom 90 Day LIBOR Futures (09/2002) 275 190 United Kingdom 90 Day LIBOR Futures (12/2002) 275 199 ----------- $ 26,778 ----------- 110 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/25/2001 93,100,000 $ 894 $ 1,621 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/25/2001 186,100,000 1,795 3,240 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 253,000,000 2,459 4,602 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/30/2001 84,300,000 773 1,533 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 05/31/2001 168,800,000 1,563 3,070 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.88 Exp. 06/04/2001 244,200,000 1,444 4,617 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/21/2001 74,600,000 2,286 1,028 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/22/2001 92,700,000 2,718 1,283 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 11/27/2001 74,600,000 2,137 1,056 Put - OTC Eurodollar vs. U.S. Dollar Strike @ 0.82 Exp. 12/03/2001 93,600,000 1,937 1,358 Put - CME Eurodollar December Futures Strike @ 95.00 Exp. 12/17/2001 1,714 720 514 Put - CME Eurodollar December Futures Strike @ 95.25 Exp. 12/17/2001 9,545 4,772 5,250 Call - CBOT U.S.Treasury Note June Futures Strike @ 107.00 Exp. 05/26/2001 1,885 1,198 1,590 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 13,125 7,161 7,177 Put - CBOT U.S. Treasury Note June Futures Strike @ 105.00 Exp. 05/26/2001 5,303 2,906 3,397 Put - CBOT U.S. Treasury Note December Futures Strike @ 105.00 Exp. 12/17/2001 1,734 993 1,301 -------------------- $ 35,755 $ 42,637 -------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Security is in default. (f) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Sell C$ 36,714 04/2001 $ 460 Buy EC 1,338,388 04/2001 (64,986) Sell 1,335,461 04/2001 16,412 Buy 1,059,188 06/2001 (3,998) Sell BP 96,680 05/2001 4,711 Buy HF 2,000,000 09/2001 (153) Buy JY 104,105,954 04/2001 (19,233) Sell 104,105,954 04/2001 19,353 Sell 103,755,954 06/2001 16,401 Sell N$ 50,890 04/2001 881 ------------- $ (30,152) ------------- (g) Principal amount denoted in indicated currency: BP - British Pound C$ - Canadian Dollar DM - German Mark EC - Euro HF - Hungarian Forint JY - Japanese Yen N$ - New Zealand Dollar (h) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on $13,033,000 notional amount with 3-month LIBOR plus 1.600% and pay $25,000,000 notional amount with a fixed rate equal to 0.426%. Broker: Lehman Brothers Exp. 04/19/2005 $ 13,033 $ 1 Receive floating rate based on 3-month LIBOR plus 0.500% and pay a fixed rate equal to 7.600%. Broker: Lehman Brothers Exp. 07/15/2003 35,000 (1,647) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.295%. Broker: Goldman Sachs Exp. 04/14/2008 JY11,635,000 (8,598) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.305%. Broker: Goldman Sachs Exp. 04/15/2008 7,563,000 (5,627) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.669%. Broker: Goldman Sachs Exp. 05/18/2007 51,000,000 (21,103) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.305%. Broker: Goldman Sachs Exp. 04/15/2008 377,000 (121) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.669%. Broker: Goldman Sachs Exp. 05/18/2007 1,500,000 (550) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.295%. Broker: Goldman Sachs Exp. 04/14/2008 580,000 (184) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 2.340%. Broker: Goldman Sachs Exp. 10/07/2007 24,500,000 (18,409) See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 111 PIMCO Schedule of Investments Class D (Cont.) Total Return Fund March 31, 2001 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.495%. Broker: Goldman Sachs Exp. 09/16/2008 JY 7,000,000 $ (1,957) Receive a fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2006 $ 385,300 4,258 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.805%. Broker: Morgan Stanley Dean Witter Exp. 01/11/2011 JY 1,389,000 (488) Receive a fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Dean Witter Exp. 06/15/2006 $ 797,200 2,399 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.757%. Broker: Merrill Lynch Exp. 01/11/2001 JY 10,000,000 (3,167) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.771%. Broker: Morgan Stanley Dean Witter Exp. 01/11/2001 42,373,000 (13,860) Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.777%. Broker: Goldman Sachs Exp. 01/12/2011 48,070,000 (15,915) Receive a fixed rate equal to 5.633% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/02/2004 BP 211,900 2,770 Receive a fixed rate equal to 5.626% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 02/02/2004 716,100 9,200 Receive a fixed rate equal to 5.560% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 02/27/2003 241,400 1,249 Receive a fixed rate equal to 5.387% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 02/28/2003 10,000 48 Receive a fixed rate equal to 5.405% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/28/2003 200,000 1,042 Receive a fixed rate equal to 5.518% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 02/28/2004 BP 52,600 $ 491 Receive a fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/02/2004 96,500 873 Receive a fixed rate equal to 5.500% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/02/2004 52,200 472 Receive a fixed rate equal to 5.478% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/08/2004 500,000 4,145 Receive a fixed rate equal to 5.471% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/15/2006 1,020,300 6,403 Receive a fixed rate equal to 5.484% and pay floating rate based on 6-month BP-LIBOR. Broker: J.P. Morgan Exp. 03/15/2006 421,100 2,581 Receive a fixed rate equal to 5.421% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 03/15/2006 147,000 821 Receive floating rate based on 6-month BP-LIBOR and pay a fixed rate equal to 5.220%. Broker: J.P. Morgan Exp. 09/19/2002 280,500 32 Receive a fixed rate equal to 5.308% and pay floating rate based on 6-month BP-LIBOR. Broker: J.P. Morgan Exp. 03/19/2006 280,500 (1,456) Receive a fixed rate equal to 5.305% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/19/2006 629,900 (2,716) Receive floating rate based on 6-month BP-LIBOR and pay a fixed rate equal to 5.215%. Broker: Goldman Sachs Exp. 09/19/2002 629,900 5 Receive a fixed rate equal to 5.207% and pay floating rate based on 6-month BP-LIBOR. Broker: J.P. Morgan Exp. 03/15/2004 197,100 (349) 112 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Receive a fixed rate equal to 5.207% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Dean Witter Exp. 03/15/2004 BP 167,300 $ (296) Receive a fixed rate equal to 9.250% and pay a fixed rate equal to 5.050%. In the event of default of Republic of Argentina Floating Rate Notes and/or Spread-Adjusted Notes, the Fund can put the bond to the counterparty at par. Broker: Deutsche Bank AG New York Exp. 05/03/2001 $ 6,000 (201) Receive fixed rate equal to 0.650% and the Fund will pay to the counterparty at par in the event of default of Niagara Mohawk Corp. 7.750% due 10/01/2008. Broker: Lehman Brothers Exp. 12/31/2004 50,000 3 Receive fixed rate equal to 0.400% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.400% due 02/01/2004. Broker: Goldman Sachs Exp. 11/10/2002 20,000 1 Receive fixed rate equal to 0.510% and the Fund will pay to the counterparty at par in the event of default of Time Warner, Inc. 7.750% due 06/15/2005. Broker: Lehman Brothers Exp. 01/25/2005 10,000 0 Receive fixed rate equal to 5.600% and the Fund will pay to the counterparty at par in the event of default of the Republic of Venezuela 9.250% due 09/15/2027. Broker: Deutsche Bank AG New York Exp. 04/04/2001 25,000 14 Receive fixed rate equal to 5.850% and the Fund will pay to the counterparty at par in the event of default of the Republic of Venezuela 9.250% due 09/15/2027. Broker: Deutsche Bank AG New York Exp. 04/17/2001 10,000 6 Receive fixed rate equal to 0.250% and the Fund will pay to the counterparty at par in the event of default of Wisconsin Electric Power 6.625% due 11/16/2006. Broker: Lehman Brothers Exp. 04/18/2003 25,000 1 Receive fixed rate equal to 1.900% and the Fund will pay to the counterparty at par in the event of default of the Republic of Brazil based on 6-month LIBOR plus 0.813% due 04/15/2006. Broker: Credit Suisse First Boston International Exp. 05/03/2001 50,000 415 Receive fixed rate equal to 1.300% and the Fund will pay to the counterparty at par in the event of default of United Mexican States 9.875% due 01/15/2007. Broker: Salomon Brothers, Inc. Exp. 05/09/2002 50,000 7 Receive fixed rate equal to 0.100% and the Fund will pay to the counterparty at par in the event of default of General Electric Capital Corp. 7.250% due 02/02/2005. Broker: J.P. Morgan Exp. 05/19/2001 50,000 1 Receive fixed rate equal to 1.500% and the Fund will pay to the counterparty at par in the event of default of United Mexican States 9.875% due 01/15/2007. Broker: Salomon Brothers, Inc. Exp. 06/13/2002 50,000 8 Receive fixed rate equal to 0.500% and the Fund will pay to the counterparty at par in the event of default of Raytheon Corp. 6.500% due 07/15/2005. Broker: Merrill Lynch Exp. 06/30/2001 25,000 1 ------------ $ (59,395) ------------ (i) Principal amount of the security is adjusted for inflation. (j) Subject to financing transaction. (k) Securities are grouped by coupon or range of coupons and represent a range of maturities. (l) Restricted security. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 113 PIMCO Schedule of Investments Class D Total Return Mortgage Fund March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.2% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (b) 3.625% due 07/15/2002 $ 55 $ 55 ----------- Total U.S. Treasury Obligations 55 (Cost $55) ----------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 123.7% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 48.6% Chase Mortgage Finance Corp. 7.000% due 07/25/2024 477 477 6.550% due 08/25/2028 576 580 6.250% due 12/25/2028 334 304 Citicorp Mortgage Securities, Inc. 6.500% due 05/25/2030 295 293 Countrywide Alternative Loan Trust 6.750% due 08/25/2028 85 85 Countrywide Home Loans 6.750% due 11/25/2027 10 10 6.500% due 03/25/2029 100 96 7.750% due 01/25/2031 249 256 DLJ Mortgage Acceptance Corp. 7.000% due 06/25/2028 138 141 Fannie Mae 6.900% due 08/25/2011 100 101 6.500% due 02/25/2019 725 727 7.750% due 08/25/2022 66 70 7.500% due 03/25/2023 100 106 7.625% due 04/25/2023 (d) 25 25 7.000% due 09/25/2023 17 17 6.750% due 09/25/2023 55 54 6.500% due 09/25/2023 37 37 6.500% due 10/25/2023 217 209 6.500% due 12/25/2023 176 168 7.100% due 12/25/2023 72 72 5.980% due 04/18/2028 (d) 111 111 Freddie Mac 6.000% due 06/15/2008 405 407 4.500% due 03/15/2021 47 45 3.500% due 12/15/2022 10 8 6.500% due 12/15/2023 48 46 6.500% due 03/15/2024 110 107 6.900% due 04/15/2026 946 961 8.000% due 06/15/2026 73 77 6.500% due 05/15/2027 73 71 7.000% due 01/15/2028 433 423 6.000% due 10/15/2028 153 143 General Electric Capital Mortgage Services, Inc. 5.250% due 11/25/2008 1,117 1,119 7.000% due 01/25/2028 100 101 6.750% due 06/25/2028 200 199 Government National Mortgage Association 7.500% due 04/20/2013 1,507 1,507 7.500% due 12/20/2022 70 71 7.000% due 07/16/2026 180 182 Mellon Residential Funding Corp. 6.580% due 07/25/2029 (d) 410 415 Norwest Asset Securities Corp. 6.250% due 09/25/2028 485 464 6.250% due 01/25/2029 167 165 PNC Mortgage Securities Corp. 6.750% due 09/25/2028 1,099 1,093 Residential Accredit Loans, Inc. 7.000% due 01/25/2028 306 308 Superannuation Members Home Loans Global Fund 6.835% due 06/15/2026 (d) 300 300 Vendee Mortgage Trust 7.750% due 05/15/2022 39 41 ----------- 12,192 ----------- Fannie Mae 20.0% 5.500% due 12/01/2030 990 940 5.805% due 10/01/2028 (d) 471 474 6.483% due 11/01/2018 (d) 40 40 6.500% due 04/16/2031 2,500 2,490 7.000% due 05/14/2031 500 505 7.217% due 08/01/2026 (d) 120 124 7.519% due 05/01/2023 (d) 156 161 8.114% due 04/01/2026 (d) 57 58 9.000% due 01/01/2020 215 229 ----------- 5,021 ----------- Federal Housing Administration 6.8% 7.430% due 06/01/2019 1,706 1,702 ----------- Freddie Mac 15.3% 6.000% due 10/01/2024-05/14/2031 (c) 2,645 2,579 6.759% due 02/01/2018 (d) 144 144 7.000% due 05/14/2031 1,000 1,012 7.894% due 11/01/2028 (d) 96 100 ----------- 3,835 ----------- Government National Mortgage Association 32.2% 7.125% due 10/20/2022 (d) 128 132 7.375% due 03/20/2016-03/20/2027 (c)(d) 1,184 1,200 7.500% due 05/15/2027-04/23/2031 (c) 4,616 4,729 7.625% due 12/20/2021-11/20/2026 (c)(d) 218 224 7.750% due 07/20/2022-07/20/2025 (c)(d) 475 487 8.000% due 04/23/2031 1,250 1,290 ----------- 8,062 ----------- Stripped Mortgage-Backed Securities 0.8% Fannie Mae (IO) 6.500% due 07/25/2007 37 1 Fannie Mae (PO) 0.000% due 07/25/2022 264 204 ----------- 205 ----------- Total Mortgage-Backed Securities 31,017 (Cost $30,390) ----------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 1.6% -------------------------------------------------------------------------------- Bayview Financial Acquisition Trust 6.103% due 07/25/2030 (d) 179 179 MLCC Mortgage Investors, Inc. 5.948% due 03/15/2025 (d) 222 222 ----------- Total Asset-Backed Securities 401 (Cost $400) ----------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 0.0% -------------------------------------------------------------------------------- Industrial 0.0% Clear Channel Communications, Inc. 1.500% due 12/01/2002 10 9 ----------- Total Convertible Bonds & Notes 9 (Cost $10) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 22.8% -------------------------------------------------------------------------------- Commercial Paper 22.6% Abbey National North America 5.020% due 08/08/2001 300 295 American Express Credit Corp. 5.620% due 04/06/2001 200 200 Becton Dickinson & Co. 6.110% due 04/25/2001 400 398 Executive Jet, Inc. 5.240% due 06/27/2001 500 494 General Electric Capital Corp. 5.370% due 04/04/2001 100 100 5.020% due 04/25/2001 400 399 Halifax PLC 4.600% due 08/02/2001 700 688 KFW International Finance, Inc. 5.450% due 04/24/2001 300 299 5.010% due 08/08/2001 200 197 National Rural Utilities Cooperative Finance Corp. 4.810% due 05/24/2001 700 696 114 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- SBC Communications, Inc. 5.290% due 04/10/2001 $ 500 $ 499 Swedbank, Inc. 5.040% due 08/08/2001 400 393 UBS Finance, Inc. 5.460% due 06/06/2001 600 595 5.340% due 06/06/2001 400 396 ----------- 5,649 ----------- Repurchase Agreement 0.2% State Street Bank 4.600% due 04/02/2001 59 59 (Dated 03/30/2001. Collateralized by Fannie Mae 6.100% due 09/14/2001 valued at $61. Repurchase proceeds are $59.) ----------- Total Short-Term Instruments 5,708 (Cost $5,707) ----------- Total Investments (a) 148.3% $ 37,190 (Cost $36,562) Other Assets and Liabilities (Net) (48.3%) (12,122) ----------- Net Assets 100.0% $ 25,068 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $36,560 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 640 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (10) ----------- Unrealized appreciation-net $ 630 ----------- (b) Principal amount of the security is adjusted for inflation. (c) Securities are grouped by coupon or range of coupons and represent a range of maturities. (d) Variable rate security. The rate listed is as of March 31, 2001. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 115 PIMCO Financial Highlights Class D
Net Realized / Net Asset Value Unrealized Gain Total Income Dividends from Selected Per Share Data for Beginning of Net Investment (Loss) on from Investment Net Investment the Year or Period Ended: Period Income (Loss) Investments Operations Income California Intermediate Municipal Bond Fund 03/31/2001 $ 10.05 $ 0.45 (a) $ 0.55 (a) $ 1.00 $ (0.42) 01/31/2000 - 03/31/2000 9.88 0.06 (a) 0.18 (a) 0.24 (0.07) California Municipal Bond Fund 07/31/2000 - 03/31/2001 $ 10.35 $ 0.31 (a) $ 0.43 (a) $ 0.74 $ (0.31) Convertible Fund 08/01/2000 - 03/31/2001 $ 15.77 $ (0.05)(a) $ (3.39)(a) $ (3.44) $ (0.20) Emerging Markets Bond Fund 03/31/2001 $ 8.61 $ 0.79 (a) $ 0.20 (a) $ 0.99 $ (0.80) Foreign Bond Fund 03/31/2001 $ 10.03 $ 0.53 (a) $ 0.51 (a) $ 1.04 $ (0.54) 03/31/2000 10.63 0.59 (a) (0.45)(a) 0.14 (0.59) 04/08/1998 - 03/31/1999 10.83 0.53 (a) 0.15 (a) 0.68 (0.53) High Yield Fund 03/31/2001 $ 10.22 $ 1.52 (a) $ (0.99)(a) $ 0.53 $ (0.86) 03/31/2000 11.23 0.89 (a) (1.01)(a) (0.12) (0.88) 04/08/1998 - 03/31/1999 11.68 0.89 (a) (0.45)(a) 0.44 (0.88) Low Duration Fund 03/31/2001 $ 9.81 $ 0.62 (a) $ 0.24 (a) $ 0.86 $ (0.64) 03/31/2000 10.10 0.61 (a) (0.29)(a) 0.32 (0.60) 04/08/1998 - 03/31/1999 10.19 0.60 (a) (0.03)(a) 0.57 (0.60) Municipal Bond Fund 03/31/2001 $ 9.47 $ 0.43 (a) $ 0.56 (a) $ 0.99 $ (0.44) 03/31/2000 10.12 0.42 (a) (0.64)(a) (0.22) (0.43) 04/08/1998 - 03/31/1999 9.98 0.40 (a) 0.14 (a) 0.54 (0.40) New York Municipal Bond Fund 03/31/2001 $ 9.94 $ 0.44 (a) $ 0.77 (a) $ 1.21 $ (0.42) 01/31/2000 - 03/31/2000 9.79 0.07 (a) 0.15 (a) 0.22 (0.07) Real Return Bond Fund 03/31/2001 $ 9.92 $ 0.72 (a) $ 0.60 (a) $ 1.32 $ (0.76) 03/31/2000 9.83 0.63 (a) 0.12 (a) 0.75 (0.64) 04/08/1998 - 03/31/1999 9.77 0.47 (a) 0.09 (a) 0.56 (0.44) Short Duration Municipal Income Fund 03/31/2001 $ 9.98 $ 0.41 (a) $ 0.17 (a) $ 0.58 $ (0.40) 01/31/2000 - 03/31/2000 9.99 0.06 (a) (0.01)(a) 0.05 (0.06) Short-Term Fund 03/31/2001 $ 9.95 $ 0.62 (a) $ 0.09 (a) $ 0.71 $ (0.61) 03/31/2000 10.03 0.55 (a) (0.08)(a) 0.47 (0.55) 04/08/1998 - 03/31/1999 10.07 0.53 (a) (0.03)(a) 0.50 (0.53) StocksPLUS Fund 03/31/2001 $ 14.08 $ (0.05)(a) $ (2.76)(a) $ (2.81) $ (0.24) 03/31/2000 14.27 1.04 (a) 1.29 (a) 2.33 (1.04) 04/08/1998 - 03/31/1999 14.13 0.79 (a) 1.38 (a) 2.17 (0.79) Strategic Balanced Fund 03/31/2001 $ 12.78 $ 1.47 (a) $ (2.49)(a) $ (1.02) $ (0.63) 03/31/2000 12.75 0.71 (a) 0.47 (a) 1.18 (0.69) 04/08/1998 - 03/31/1999 12.65 0.79 (a) 0.60 (a) 1.39 (0.62) Total Return Fund 03/31/2001 $ 9.96 $ 0.64 (a) $ 0.56 (a) $ 1.20 $ (0.62) 03/31/2000 10.36 0.60 (a) (0.40)(a) 0.20 (0.58) 04/08/1998 - 03/31/1999 10.66 0.59 (a) 0.12 (a) 0.71 (0.59) Total Return Mortgage Fund 03/31/2001 $ 9.97 $ 0.59 (a) $ 0.63 (a) $ 1.22 $ (0.59) 03/31/2000 10.19 0.54 (a) (0.20)(a) 0.34 (0.55) 04/08/1998 - 03/31/1999 10.27 0.53 (a) 0.02 (a) 0.55 (0.53)
+ Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) Ratio of expenses to average net assets excluding interest expense is 0.75%. (c) Ratio of expenses to average net assets excluding interest expense is 0.95%. 116 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Dividends in Distributions Distributions in Ratio of Excess of Net from Net Excess of Net Expenses to Investment Realized Capital Realized Capital Total Net Asset Value Net Assets End Average Net Income Gains Gains Distributions End of Period Total Return of Period (000s) Assets $ 0.00 $ (0.03) $ 0.00 $ (0.45) $ 10.60 10.21% $ 181 0.86% 0.00 0.00 0.00 (0.07) 10.05 2.39 10 0.85+(e) $ 0.00 $ (0.43) $ 0.00 $ (0.74) $ 10.35 7.82% $ 10 0.85%+ $ 0.00 $ 0.00 $ (0.70) $ (0.90) $ 11.43 (22.62)% $ 8 1.05% $ 0.00 $ 0.00 $ (0.40) $ (1.20) $ 8.40 12.58% $ 11 1.33% $ 0.00 $ 0.00 $ (0.21) $ (0.75) $ 10.32 10.84% $ 26,590 0.99% 0.00 (0.15) 0.00 (0.74) 10.03 1.51 9,955 1.16 (c) 0.00 (0.10) (0.25) (0.88) 10.63 6.46 8,513 0.95+ $ (0.01) 0.00 $ 0.00 $ (0.87) $ 9.88 5.40% $ 32,820 0.90% (0.01) 0.00 0.00 (0.89) 10.22 (1.14) 23,601 0.90 (0.01) 0.00 0.00 (0.89) 11.23 4.00 9,065 0.90+ $ 0.00 0.00 $ 0.00 $ (0.64) $ 10.03 9.10% $ 19,282 0.82%(b) (0.01) 0.00 0.00 (0.61) 9.81 3.22 12,018 0.83 (b) 0.00 (0.01) (0.05) (0.66) 10.10 5.77 6,481 0.75+ $ 0.00 0.00 $ 0.00 $ (0.44) $ 10.02 10.74% $ 1,414 0.85% 0.00 0.00 0.00 (0.43) 9.47 (2.16) 1,104 0.85 0.00 0.00 0.00 (0.40) 10.12 5.47 242 0.85+ $ 0.00 $ (0.09) $ 0.00 $ (0.51) $ 10.64 12.44% $ 113 0.90%(g) 0.00 0.00 0.00 (0.07) 9.94 2.21 10 0.87+(f) $ 0.00 $ (0.08) $ 0.00 $ (0.84) $ 10.40 13.99% $ 57,696 0.94% 0.00 (0.02) 0.00 (0.66) 9.92 7.93 15,560 0.93 (0.06) 0.00 0.00 (0.50) 9.83 5.89 193 0.92+ $ 0.00 $ 0.00 $ 0.00 $ (0.40) $ 10.16 5.78% $ 11 0.81% 0.00 0.00 0.00 (0.06) 9.98 0.47 10 0.80+(d) $ 0.00 $ 0.00 $ (0.02) $ (0.63) $ 10.03 7.33% $ 6,613 1.31%(b) 0.00 0.00 0.00 (0.55) 9.95 4.87 3,361 0.93 (b) 0.00 0.00 (0.01) (0.54) 10.03 5.10 2,278 0.75+ $ 0.00 $ 0.00 $ (0.91) $ (1.15) $ 10.12 (21.27)% $ 2,769 1.05% (0.97) (0.51) 0.00 (2.52) 14.08 17.32 3,288 1.05 0.00 (1.24) 0.00 (2.03) 14.27 16.69 1,721 1.05+ $ 0.00 $ 0.00 $ (0.69) $ (1.32) $ 10.44 (8.65)% $ 632 0.76%(h) 0.00 (0.15) (0.31) (1.15) 12.78 9.55 167 1.05 0.00 (0.67) 0.00 (1.29) 12.75 11.45 173 1.05+ $ (0.02) $ 0.00 $ 0.00 $ (0.64) $ 10.52 12.44% $264,984 0.81%(b) (0.02) 0.00 0.00 (0.60) 9.96 2.00 80,459 0.87 (b) 0.00 (0.24) (0.18) (1.01) 10.36 6.73 34,839 0.75+ $ 0.00 $ (0.18) $ 0.00 $ (0.77) $ 10.42 12.69% $ 1,261 0.90% (0.01) 0.00 0.00 (0.56) 9.97 3.47 166 0.90 0.00 (0.03) (0.07) (0.63) 10.19 5.41 183 0.90+
Ratio of Net Investment Income (Loss) to Average Portfolio Net Assets Turnover Rate 4.26% 257% 3.88+ 357 4.47% 338% (0.35)% 225% 9.33% 902% 5.26% 417% 5.77 330 4.82+ 376 15.06% 53% 8.29 39 8.07+ 39 6.23% 348% 6.11 82 5.81+ 245 4.41% 306% 4.46 145 3.99+ 70 4.23% 973% 4.02+ 270 7.14% 202% 6.44 253 4.75+ 438 4.05% 208% 3.51+ 171 6.15% 121% 5.54 38 5.05+ 47 (0.43)% 270% 7.16 92 8.12+ 81 12.67% 651% 5.49 176 6.41+ 82 6.24% 450% 5.97 223 5.21+ 154 5.78% 848% 5.38 1476 5.15+ 158 (d) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 1.29%. (e) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 1.74%. (f) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 2.52%. (g) Ratio of expenses to average net assets excluding interest expense is 0.85%. (h) Effective September 29, 2000, the Strategic Balanced Fund did not incur advisory fee expenses. See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 117 PIMCO Statements of Assets and Liabilities Class D March 31, 2001
California Intermediate California Emerging Amounts in thousands, Municipal Municipal Convertible Markets Foreign High Low except per share amounts Bond Fund Bond Fund Fund Bond Fund Bond Fund Yield Fund Duration Fund Assets: Investments, at value $ 119,480 $ 12,320 $ 86,394 $ 58,386 $ 1,040,636 $ 2,551,020 $ 8,365,786 Cash and foreign currency 2 140 0 0 37,332 5,303 4,017 Receivable for investments and foreign currency sold 0 0 19,247 16,961 84,303 35,585 843,152 Receivable for Fund shares sold 144 0 641 7 1,594 37,429 11,388 Variation margin receivable 0 3 0 0 0 0 85 Interest and dividends receivable 1,737 172 393 1,237 16,720 48,416 59,063 Manager reimbursement receivable 14 29 10 0 0 0 0 Other assets 0 0 1 0 1,681 13,788 343 $ 121,377 $ 12,664 $ 106,686 $ 76,591 $ 1,182,266 $ 2,691,541 $ 9,283,834 ---------------------------------------------------------------------------------------------------------------------------------- Liabilities: Payable for investments and foreign currency purchased $ 2,738 $ 0 $ 38 $ 14,857 $ 57,126 $ 37,218 $ 3,405,245 Payable for financing transactions 0 0 0 1,449 446,311 0 348,283 Payable for short sales 0 0 0 0 0 0 703,503 Due to Custodian 0 0 1,604 2,498 0 0 0 Notes payable 0 0 0 0 0 0 156,287 Written options outstanding 0 0 0 0 2,046 0 2,050 Payable for Fund shares redeemed 37 0 13,251 92 999 3,479 57,470 Dividends payable 58 1 0 29 362 5,404 3,541 Accrued investment advisory fee 27 3 50 23 147 578 1,001 Accrued administration fee 28 3 34 21 177 709 813 Accrued distribution fee 0 0 13 3 45 556 134 Accrued servicing fee 6 0 6 1 38 218 107 Variation margin payable 14 0 0 0 173 0 0 Other liabilities 5 0 0 20 1 1,237 2,111 2,913 7 14,996 18,993 507,425 49,399 4,680,545 ---------------------------------------------------------------------------------------------------------------------------------- Net Assets $ 118,464 $ 12,657 $ 91,690 $ 57,598 $ 674,841 $ 2,642,142 $ 4,603,289 ---------------------------------------------------------------------------------------------------------------------------------- Net Assets Consist of: Paid in capital $ 112,219 $ 12,066 $ 110,156 $ 55,779 $ 680,856 $ 3,109,817 $ 4,630,511 Undistributed (overdistributed) net investment income 1,115 152 (1,366) 1,525 (789) (1,912) 254 Accumulated undistributed net realized gain (loss) (68) 11 (8,984) (486) (7,969) (300,146) (47,743) Net unrealized appreciation (depreciation) 5,198 428 (8,146) 780 2,743 (165,617) 20,267 $ 118,464 $ 12,657 $ 91,690 $ 57,598 $ 674,841 $ 2,642,142 $ 4,603,289 ---------------------------------------------------------------------------------------------------------------------------------- Net Assets: Class D $ 181 $ 10 $ 8 $ 11 $ 26,590 $ 32,826 $ 19,282 Other Classes 118,283 12,647 91,682 57,587 648,251 2,609,316 4,584,007 Shares Issued and Outstanding: Class D 17 1 1 1 2,576 3,323 1,923 Net Asset Value and Redemption Price Per Share (Net Assets Per Share Outstanding) Class D $ 10.60 $ 10.35 $ 11.43 $ 8.40 $ 10.32 $ 9.88 $ 10.03 Cost of Investments Owned $ 114,374 $ 11,884 $ 94,684 $ 57,651 $ 1,061,915 $ 2,716,720 $ 8,337,219 ---------------------------------------------------------------------------------------------------------------------------------- Cost of Foreign Currency Held $ 0 $ 0 $ 22 $ 0 $ 37,473 $ 2,627 $ 4,446 ----------------------------------------------------------------------------------------------------------------------------------
118 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
New York Short Duration Strategic Municipal Municipal Real Return Municipal Short-Term StocksPLUS Balanced Total Return Total Return Bond Fund Bond Fund Bond Fund Bond Fund Fund Fund Fund Fund Mortgage Fund $ 84,850 $ 3,973 $1,558,398 $ 13,076 $1,158,227 $1,543,635 $ 73,945 $64,127,213 $ 37,190 2 1 1,977 2 1,003 3,850 716 218,324 1,197 0 0 96,777 330 294,322 16,915 0 4,821,384 10,581 318 0 10,321 0 7,914 752 43 249,896 72 0 0 0 0 0 5,075 0 8,311 0 1,041 66 14,895 245 11,006 2,449 172 476,095 109 0 14 0 13 0 0 0 0 0 1 0 764 0 253 4 0 1,125 1 $ 86,212 $ 4,054 $1,683,132 $ 13,666 $1,472,725 $1,572,680 $ 74,876 $69,902,348 $ 49,150 ----------------------------------------------------------------------------------------------------------------------------- $ 5,647 $ 0 $ 22,680 $ 0 $ 4,077 $ 535,113 $ 251 $21,420,265 $ 24,016 0 0 756,305 0 443,596 392 0 5,667,668 0 0 0 0 0 295,950 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 72,131 383 0 0 0 0 0 0 0 0 815 0 42,637 0 282 0 2,000 6 3,537 18,316 89 134,060 49 78 0 1,075 0 834 10 0 46,539 3 17 1 184 2 140 368 0 9,171 5 21 1 218 2 127 306 11 7,573 6 20 0 73 0 11 266 15 3,345 0 11 0 57 0 26 128 6 1,139 3 0 0 27 0 5 275 0 3,094 0 0 0 1,391 0 1,118 825 0 61,464 0 6,076 2 784,010 10 821,552 551,197 372 27,396,955 24,082 ----------------------------------------------------------------------------------------------------------------------------- $ 80,136 $ 4,052 $ 899,122 $ 13,656 $ 651,173 $1,015,483 $ 74,504 $42,505,393 $ 25,068 ----------------------------------------------------------------------------------------------------------------------------- $ 77,328 $ 3,843 $ 862,868 $ 13,435 $ 650,737 $1,334,218 $ 87,158 $41,959,747 $ 24,059 17 66 3,210 31 (1,518) (26,538) 465 154,725 382 363 29 (786) 2 (868) (271,284) (2,315) (48,115) (1) 2,428 114 33,830 188 2,822 (20,913) (10,804) 439,036 628 $ 80,136 $ 4,052 $ 899,122 $ 13,656 $ 651,173 $1,015,483 $ 74,504 $42,505,393 $ 25,068 ----------------------------------------------------------------------------------------------------------------------------- $ 1,414 $ 113 $ 57,733 $ 11 $ 6,613 $ 2,769 $ 632 $ 264,983 $ 1,261 78,722 3,939 841,389 13,645 644,560 1,012,714 73,872 42,240,410 23,807 141 11 5,551 1 659 272 61 25,192 121 $ 10.02 $ 10.64 $ 10.40 $ 10.16 $ 10.03 $ 10.12 $ 10.44 $ 10.52 $ 10.42 $ 82,422 $ 3,859 $1,524,018 $ 12,888 $1,152,292 $1,541,379 $ 84,847 $63,623,558 $ 36,562 ----------------------------------------------------------------------------------------------------------------------------- $ 0 $ 0 $ 431 $ 0 $ 991 $ 3,832 $ 561 $ 274,176 $ 0 -----------------------------------------------------------------------------------------------------------------------------
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 119 PIMCO Statements of Operations Class D For the year or period ended March 31, 2001
California Intermediate California Emerging Amounts in thousands, Municipal Municipal Convertible Markets Foreign High Low except per share amounts Bond Fund Bond Fund Fund Bond Fund Bond Fund Yield Fund Duration Fund Investment Income: Interest $ 4,804 $ 484 $ (607) $ 5,027 $ 37,119 $ 262,112 $ 305,644 Dividends, net of foreign taxes 0 0 1,708 1 480 7,951 7,445 Miscellaneous Income 1 3 0 0 0 60 0 Total Income 4,805 487 1,101 5,028 37,599 270,123 313,089 -------------------------------------------------------------------------------------------------------------------------------- Expenses: Investment advisory fees 236 24 592 211 1,478 7,084 10,648 Administration fees 257 22 407 192 1,758 8,316 8,636 Servicing fees - Class D 0 0 0 0 40 66 36 Distribution and/or servicing fees - Other Classes 72 0 189 43 759 7,815 2,566 Trustees' fees 0 0 1 0 3 15 23 Organization costs 0 29 0 0 0 0 0 Interest Expense 0 0 27 36 245 0 2,684 Miscellaneous 5 0 7 5 0 5 0 Total Expenses 570 75 1,223 487 4,283 23,301 24,593 Reimbursement by Manager 0 (29) 0 0 0 0 0 Net Expenses 570 46 1,223 487 4,283 23,301 24,593 Net Investment Income (Loss) 4,235 441 (122) 4,541 33,316 246,822 288,496 -------------------------------------------------------------------------------------------------------------------------------- Net Realized and Unrealized Gain (Loss): Net realized gain (loss) on investments 1,557 531 (6,937) 2,776 15,252 (237,944) 7,880 Net capital gain distributions received from underlying funds 0 0 0 0 0 0 0 Net realized gain (loss) on futures contracts and written options (279) 13 0 0 (5,763) 0 (37) Net realized gain (loss) on foreign currency transactions 0 0 212 (76) (10,379) (42) 9,157 Net change in unrealized appreciation (depreciation) on investments 5,034 436 (36,311) (717) 14,127 111,549 81,101 Net change in unrealized appreciation (depreciation) on futures contracts and written options 92 (8) 0 0 (2,938) 0 2,894 Net change in unrealized appreciation (depreciation) on translation of assets and liabilities denominated in foreign currencies 0 0 199 59 20,756 45 (3,086) Net Gain (Loss) 6,404 972 (42,837) 2,042 31,055 (126,392) 97,909 Net Increase (Decrease) in Assets Resulting from Operations $ 10,639 $ 1,413 $ (42,959) $ 6,583 $ 64,371 $ 120,430 $ 386,405 --------------------------------------------------------------------------------------------------------------------------------
120 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
New York Short Duration Strategic Municipal Municipal Real Return Municipal Short-Term StocksPLUS Balanced Total Return Total Return Bond Fund Bond Fund Bond Fund Income Fund Fund Fund Fund Fund Mortgage Fund $ 3,329 $ 162 $ 44,071 $ 643 $ 50,985 $ 12,663 $ 3,393 $ 2,508,225 $ 1,127 0 0 11 0 0 1,152 2,414 32,065 0 3 0 0 0 0 45 0 104 0 3,332 162 44,082 643 50,985 13,860 5,807 2,540,394 1,127 ----------- ----------- ----------- -------------- ------------- ------------ ----------- ----------- ------------- 153 8 1,358 26 1,707 5,319 217 89,506 42 196 8 1,559 25 1,530 4,439 224 73,048 44 2 0 77 0 13 8 1 367 1 302 0 668 0 394 5,711 243 31,209 8 0 0 3 0 4 7 0 196 0 0 0 2 0 0 0 0 0 0 0 0 217 1 3,817 0 14 21,417 5 0 0 2 1 1 3 0 0 0 653 16 3,886 53 7,466 15,487 699 215,743 100 0 0 0 0 0 0 0 0 0 653 16 3,886 53 7,466 15,487 699 215,743 100 2,679 146 40,196 590 43,519 (1,627) 5,108 2,324,651 1,027 ----------- ----------- ----------- -------------- ------------- ------------ ----------- ----------- ------------- 1,370 101 6,609 34 1,431 4,385 (1,201) 982,913 741 0 0 0 0 0 0 1,770 0 0 (72) 31 338 7 (93) (183,594) 3,916 248,438 10 0 0 624 0 (1,134) (403) (972) (4,989) 0 2,568 122 29,647 182 6,058 6,605 (9,323) 800,434 651 0 0 83 0 88 (119,526) (6,479) (6,524) (2) 0 0 495 0 36 4,312 72 1,460 0 3,866 254 37,796 223 6,386 (288,221) (12,217) 2,021,732 1,400 $ 6,545 $ 400 $ 77,992 $ 813 $ 49,905 $ (289,848) $ (7,109) $ 4,346,383 $ 2,427 ----------- ----------- ----------- -------------- ------------- ------------ ----------- ----------- -------------
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 121 PIMCO Statements of Changes in Net Assets Class D
California California Intermediate Municipal Amounts in thousands Municipal Bond Fund Bond Fund Year Ended Period from Period from Increase (Decrease) in Net Assets from: March 31, 2001 August 31, 1999 May 16, 2000 to March 31, 2001 to March 31, 2001 Operations: Net investment income (loss) $ 4,235 $ 106 $ 441 Net realized gain (loss) 1,278 (5) 544 Net capital gain distributions received from underlying funds 0 0 0 Net change in unrealized appreciation (depreciation) 5,126 72 428 Net increase (decrease) resulting from operations 10,639 173 1,413 ------------------------------------------------------------------ -------------- ----------------- ------------------ Distributions to Shareholders: From net investment income Class D (2) 0 0 Other Classes (4,142) (105) (432) In excess of net investment income Class D 0 0 0 Other Classes 0 0 0 From net realized capital gains Class D 0 0 0 Other Classes (311) 0 (390) In excess of net realized capital gains Class D 0 0 0 Other Classes 0 (7) 0 Total Distributions (4,455) (112) (822) ------------------------------------------------------------------ -------------- ----------------- ------------------ Fund Share Transactions: Receipts for shares sold Class D 178 10 10 Other Classes 156,058 10,729 21,945 Issued as reinvestment of distributions Class D 2 0 1 Other Classes 4,237 103 810 Cost of shares redeemed Class D (12) 0 0 Other Classes (58,411) (675) (10,700) Net increase (decrease) resulting from Fund share transactions 102,052 10,167 12,066 Total Increase (Decrease) in Net Assets 108,236 10,228 12,657 ------------------------------------------------------------------ -------------- ----------------- ------------------ Net Assets: Beginning of period 10,228 0 0 End of period * $ 118,464 $ 10,228 $ 12,657 *Including net undistributed (overdistributed) investment income of: $ 1,115 $ 1 $ 152 Amounts in thousands Convertible Fund Year Ended Year Ended Increase (Decrease) in Net Assets from: March 31, 2001 March 31, 2000 Operations: Net investment income (loss) $ (122) $ 293 Net realized gain (loss) (6,725) 7,821 Net capital gain distributions received from underlying funds 0 0 Net change in unrealized appreciation (depreciation) (36,112) 27,966 Net increase (decrease) resulting from operations (42,959) 36,080 ------------------------------------------------------------------ -------------- ----------------- Distributions to Shareholders: From net investment income Class D 0 0 Other Classes (2,368) (293) In excess of net investment income Class D 0 0 Other Classes 0 (1,271) From net realized capital gains Class D 0 0 Other Classes (7,035) (619) In excess of net realized capital gains Class D 0 0 Other Classes 0 0 Total Distributions (9,403) (2,183) ------------------------------------------------------------------ -------------- ----------------- Fund Share Transactions: Receipts for shares sold Class D 0 0 Other Classes 113,053 190,503 Issued as reinvestment of distributions Class D 1 0 Other Classes 8,646 2,104 Cost of shares redeemed Class D 0 0 Other Classes (161,679) (42,473) Net increase (decrease) resulting from Fund share transactions (39,979) 150,134 Total Increase (Decrease) in Net Assets (92,341) 184,031 ------------------------------------------------------------------ -------------- ----------------- Net Assets: Beginning of period 184,031 0 End of period * $ 91,690 $ 184,031 *Including net undistributed (overdistributed) investment income of: $ (1,336) $ 5,512
122 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Emerging Markets Bond Fund Foreign Bond Fund High Yield Fund Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 $ 4,541 $ 2,012 $ 33,316 $ 35,220 $ 246,822 $ 296,022 2,700 1,254 (890) 4,992 (237,986) (70,452) 0 0 0 0 0 0 (658) 2,001 31,945 (31,738) 111,594 (263,887) 6,583 5,267 64,371 8,474 120,430 (38,317) -------------------------------- -------------------------------- -------------------------------- (1) 0 (839) (562) (2,275) (1,533) (4,544) (2,011) (32,294) (34,615) (242,557) (292,206) 0 0 0 0 (17) (11) 0 0 0 0 (1,852) (2,133) 0 0 0 (80) 0 0 0 0 0 (4,745) 0 0 0 0 (373) (60) 0 0 (2,352) 0 (12,497) (3,587) 0 0 (6,897) (2,011) (46,003) (43,649) (246,701) (295,883) -------------------------------- -------------------------------- -------------------------------- 0 0 18,523 8,012 43,592 23,790 39,107 43,469 249,638 251,525 1,495,450 2,050,531 1 0 1,188 698 1,982 1,515 6,408 1,876 38,972 34,688 186,848 240,203 0 0 (3,687) (6,691) (35,803) (8,901) (15,451) (25,312) (193,686) (328,315) (2,094,049) (2,025,795) 30,065 20,033 110,948 (40,083) (401,980) 281,343 29,751 23,289 129,316 (75,258) (528,251) (52,857) -------------------------------- -------------------------------- -------------------------------- 27,847 4,558 545,525 620,783 3,170,393 3,223,250 $ 57,598 $ 27,847 $ 674,841 $ 545,525 $ 2,642,142 $ 3,170,393 $ 1,525 $ 862 $ (789) $ 15,115 $ (1,912) $ (1,991) Low Duration Fund Municipal Bond Fund Year Ended Year Ended Year Ended Year Ended March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 $ 288,496 $ 265,005 $ 2,679 $ 2,314 17,000 (47,944) 1,298 (919) 0 0 0 0 80,909 (75,164) 2,568 (2,965) 386,405 141,897 6,545 (1,570) -------------- -------------- -------------- -------------- (918) (545) (37) (21) (279,188) (260,454) (2,639) (2,287) (28) (8) 0 0 (8,391) (3,942) 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (288,525) (264,949) (2,676) (2,308) -------------- -------------- -------------- -------------- 11,532 9,569 4,243 2,373 2,847,901 3,465,383 43,041 21,145 930 544 33 18 247,021 225,453 1,851 1,620 (5,571) (4,329) (4,028) (1,512) (2,586,732) (3,454,487) (21,456) (25,741) 515,081 242,133 23,684 (2,097) 612,961 119,081 27,553 (5,975) -------------- -------------- -------------- -------------- 3,990,328 3,871,247 52,583 58,558 $ 4,603,289 $ 3,990,328 $ 80,136 $ 52,583 $ 254 $ (8,390) $ 17 $ 4
See accompanying notes| 3.31.01 | PIMCO Funds Annual Report 123 PIMCO Statements of Changes in Net Assets Class D (Cont.)
New York Municipal Amounts in thousands Bond Fund Real Return Bond Fund Year Ended Period from Year Ended Year Ended Increase (Decrease) in Net Assets from: March 31, 2001 August 31, 1999 March 31, 2001 March 31, 2000 to March 31, 2000 Operations: Net investment income (loss) $ 146 $ 70 $ 40,196 $ 7,689 Net realized gain (loss) 132 (4) 7,571 317 Net capital gain distributions received from underlying funds 0 0 0 0 Net change in unrealized appreciation (depreciation) 122 (8) 30,225 3,722 Net increase (decrease) resulting from operations 400 58 77,992 11,728 ------------------------------------------------------------- --------------- ------------------ -------------- -------------- Distributions to Shareholders: From net investment income Class D (1) 0 (2,232) (321) Other Classes (144) (70) (38,065) (7,215) In excess of net investment income Class D 0 0 0 0 Other Classes 0 0 0 0 From net realized capital gains Class D 0 0 (303) (17) Other Classes (28) 0 (4,906) (276) In excess of net realized capital gains Class D 0 0 0 0 Other Classes 0 (6) 0 0 Total Distributions (173) (76) (45,506) (7,829) ------------------------------------------------------------- --------------- ------------------ -------------- -------------- Fund Share Transactions: Receipts for shares sold Class D 100 10 46,212 16,706 Other Classes 485 3,010 671,659 236,282 Issued in reorganization Class D 0 0 0 0 Other Classes 0 0 0 0 Issued as reinvestment of distributions Class D 1 0 2,445 319 Other Classes 172 76 36,769 5,502 Cost of shares redeemed Class D 0 0 (8,355) (1,910) Other Classes (11) 0 (151,955) (19,148) Net increase (decrease) resulting from Fund share transactions 747 3,096 596,775 237,751 Total Increase (Decrease) in Net Assets 974 3,078 629,261 241,650 ------------------------------------------------------------- --------------- ------------------ -------------- -------------- Net Assets: Beginning of period 3,078 0 269,861 28,211 End of period * $ 4,052 $ 3,078 $ 899,122 $ 269,861 *Including net undistributed (overdistributed) investment income of: $ 66 $ 0 $ 3,210 $ 1,023 Short Duration Amounts in thousands Municipal Income Fund Year Ended Period from Increase (Decrease) in Net Assets from: March 31, 2001 August 31, 1999 to March 31, 2000 Operations: Net investment income (loss) $ 590 $ 244 Net realized gain (loss) 41 (25) Net capital gain distributions received from underlying funds 0 0 Net change in unrealized appreciation (depreciation) 182 6 Net increase (decrease) resulting from operations 813 225 ------------------------------------------------------------- -------------- ---------------- Distributions to Shareholders: From net investment income Class D 0 0 Other Classes (573) (241) In excess of net investment income Class D 0 0 Other Classes 0 0 From net realized capital gains Class D 0 0 Other Classes 0 0 In excess of net realized capital gains Class D 0 0 Other Classes 0 0 Total Distributions (573) (241) ------------------------------------------------------------- -------------- ---------------- Fund Share Transactions: Receipts for shares sold Class D 0 10 Other Classes 13,744 10,500 Issued in reorganization Class D 0 0 Other Classes 0 0 Issued as reinvestment of distributions Class D 0 0 Other Classes 575 241 Cost of shares redeemed Class D 0 0 Other Classes (11,638) 0 Net increase (decrease) resulting from Fund share transactions 2,681 10,751 Total Increase (Decrease) in Net Assets 2,921 10,735 ------------------------------------------------------------- -------------- ---------------- Net Assets: Beginning of period 10,735 0 End of period * $ 13,656 $ 10,735 *Including net undistributed (overdistributed) investment income of: $ 31 $ 3
124 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes
Short-Term Fund StocksPLUS Fund Strategic Balanced Fund Total Return Fund Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended Year Ended March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 $ 43,519 $ 37,374 $ (1,627) $ 98,837 $ 5,108 $ 8,094 $ 2,324,651 $ 1,778,306 204 (1,776) (179,612) 38,756 1,743 (274) 1,226,362 (847,388) 0 0 0 0 1,770 0 0 0 6,182 (3,309) (108,609) 87,250 (15,730) 4,531 795,370 (242,138) 49,905 32,289 (289,848) 224,843 (7,109) 12,351 4,346,383 688,780 ------------------------------- ------------------------------ ------------------------------- ------------------------------- (328) (198) (55) (227) (16) (9) (8,971) (3,193) (43,171) (37,167) (24,078) (107,742) (4,218) (8,418) (2,257,780) (1,698,045) 0 0 0 0 0 0 (245) (138) 0 0 0 0 0 0 (61,757) (72,908) 0 0 0 (209) 0 (2) 0 0 0 0 0 (95,326) 0 (1,779) 0 0 (9) 0 (219) (109) (26) (4) 0 0 (1,052) 0 (88,496) (49,468) (4,424) (3,575) 0 0 (44,560) (37,365) (112,848) (253,081) (8,684) (13,787) (2,328,753) (1,774,284) ------------------------------- ------------------------------ ------------------------------- ------------------------------- 5,633 4,614 918 2,553 690 124 218,432 71,612 678,100 1,354,008 414,370 792,443 12,850 21,377 16,128,077 13,430,759 0 0 0 0 0 0 0 0 0 0 0 0 0 66,780 0 0 319 195 263 534 41 15 9,094 3,317 33,061 26,908 97,921 239,951 7,964 9,186 1,841,940 1,410,633 (2,748) (3,698) (707) (1,416) (181) (141) (51,706) (27,553) (777,538) (1,269,938) (593,381) (708,774) (86,065) (39,025) (9,194,347) (8,391,495) (63,173) 112,089 (80,616) 325,291 (64,701) 58,316 8,951,490 6,497,273 (57,828) 107,013 (483,312) 297,053 (80,494) 56,880 10,969,120 5,411,769 ------------------------------- ------------------------------ ------------------------------- ------------------------------- 709,001 601,988 1,498,795 1,201,742 154,998 98,118 31,536,273 26,124,504 $ 651,173 $ 709,001 $ 1,015,483 $ 1,498,795 $ 74,504 $ 154,998 $ 42,505,393 $ 31,536,273 $ (1,518) $ 356 $ (26,538) $ 38,390 $ 465 $ 1,795 $ 154,725 $ (57,894) Total Return Mortgage Fund Year Ended Year Ended March 31, 2001 March 31, 2000 $ 1,027 $ 238 751 (6) 0 0 649 (78) 2,427 154 -------------------------------------- (29) (6) (998) (232) 0 0 0 0 (11) 0 (352) 0 0 0 0 (3) (1,390) (241) -------------------------------------- 1,122 176 23,394 51 0 0 0 0 38 5 1,336 235 (89) (212) (5,907) (342) 19,894 (87) 20,931 (174) -------------------------------------- 4,137 4,311 $ 25,068 $ 4,137 $ 382 $ 4
See accompanying notes | 3.31.01 | PIMCO Funds Annual Report 125 PIMCO Statements of Cash Flows Class D March 31, 2001
Foreign Real Return Amounts in thousands Bond Fund Bond Fund Short-Term Fund Increase (Decrease) in Cash and Foreign Currency from: Financing Activities Sales of Fund shares $ 268,133 $ 708,752 $ 679,178 Redemptions of Fund shares (197,372) (158,587) (803,817) Cash distributions paid (5,980) (5,636) (13,952) Increase from financing transactions 167,403 588,733 437,482 Net increase from financing activities 232,184 1,133,262 298,891 Operating Activities Purchases of long-term securities and foreign currency (4,245,078) (3,285,517) (1,652,199) Proceeds from sales of long-term securities and foreign currency 4,059,928 2,336,368 1,081,041 Purchases of short-term securities (net) (60,295) (178,550) 227,689 Net investment income 33,316 40,196 43,519 Change in other receivables/payables (net) 7,619 (44,116) 1,434 Net (decrease) from operating activities (204,510) (1,131,619) (298,516) ---------------------------------------------------------------- ------------ ----------- ----------- Net Increase in Cash and Foreign Currency 27,674 1,643 375 ---------------------------------------------------------------- ------------ ----------- ----------- Cash and Foreign Currency Beginning of period 9,658 334 628 End of period $ 37,332 $ 1,977 $ 1,003
126 PIMCO Funds Annual Report | 3.31.01 | See accompanying notes PIMCO Notes to Financial Statements Class D March 31, 2001 1. Organization PIMCO Funds: Pacific Investment Management Series (the "Trust") was established as a Massachusetts business trust on February 19, 1987. The Trust is registered under the Investment Company Act of 1940 (the "Act"), as amended, as an open-end investment management company. The Trust currently consists of 39 separate investment funds (the "Funds"). The Trust may offer up to six classes of shares: Institutional, Administrative, A, B, C and D. Each share class has identical voting rights (except that shareholders of a class have exclusive voting rights regarding any matter relating solely to that class of shares). Information presented in these financial statements pertains to the Class D shares of the Trust. Certain detailed financial information for the Institutional, Administrative, A, B, and C Classes (the "Other Classes") is provided separately and is available upon request. 2. Significant Accounting Policies The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America. The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America 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. Security Valuation. Portfolio securities and other financial instruments for which market quotations are readily available are stated at market value. Market value is determined on the basis of last reported sales prices, or if no sales are reported, as is the case for most securities traded over-the-counter, the mean between representative bid and asked quotations obtained from a quotation reporting system or from established market makers. Fixed income securities, including those to be purchased under firm commitment agreements, are normally valued on the basis of quotes obtained from brokers and dealers or pricing services. Short-term investments which mature in 60 days or less are valued at amortized cost, which approximates market value. Certain fixed income securities for which daily market quotations are not readily available may be valued, pursuant to guidelines established by the Board of Trustees, with reference to fixed income securities whose prices are more readily obtainable. Securities Transactions and Investment Income. Securities transactions are recorded as of the trade date. Securities purchased or sold on a when-issued or delayed-delivery basis may be settled a month or more after the trade date. Realized gains and losses from securities sold are recorded on the identified cost basis. Dividend income is recorded on the ex-dividend date, except certain dividends from foreign securities where the ex-dividend date may have passed, are recorded as soon as the Fund is informed of the ex-dividend date. Interest income, adjusted for the accretion of discounts and amortization of premiums, is recorded on the accrual basis. Dividends and Distributions to Shareholders. Dividends from net investment income, if any, of each Fund, except the Convertible, StocksPLUS and Strategic Balanced Funds, are declared on each day the Trust is open for business and are distributed to shareholders monthly. Dividends from net investment income, if any, of the Convertible, StocksPLUS and Strategic Balanced Funds are declared and distributed to shareholders quarterly. Net realized capital gains earned by a Fund, if any, will be distributed no less frequently than once each year. Income dividends and capital gain distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for such items as wash sales, foreign currency transactions, net operating losses and capital loss carryforwards. Distributions reflected as a tax basis return of capital in the accompanying Statements of Changes in Net Assets have been reclassified to paid in capital. In addition, other amounts have been reclassified between undistributed net investment income, accumulated undistributed net realized gains or losses and paid in capital to more appropriately conform financial accounting to tax characterizations of dividends and distributions. Foreign Currency. Foreign currencies, investments, and other assets and liabilities are translated into U.S. dollars at the exchange rates prevailing at the end of the period. Fluctuations in the value of these assets and liabilities resulting from changes in exchange rates are recorded as unrealized foreign currency gains (losses). Realized gains (losses) and unrealized appreciation (depreciation) on investment securities and income and expenses are translated on the respective dates of such transactions. The effect of changes in foreign currency exchange rates on investments in securities are not segregated in the Statements of Operations from the effects of changes in market prices of those securities, but are included with the net realized and unrealized gain or loss on investment securities. 3.31.01 | PIMCO Funds Annual Report 127 PIMCO Notes to Financial Statements Class D (Cont.) March 31, 2001 Multiclass Operations. Each class offered by the Trust has equal rights as to assets and voting privileges. Income and non-class specific expenses of each Fund, except the Convertible, StocksPLUS and Strategic Balanced Funds, are allocated daily to each class of shares based on the relative value of settled shares. Income and non-class specific expenses of the Convertible, StocksPLUS and Strategic Balanced Funds are allocated daily to each class of shares based on the relative net assets of each class. Realized and unrealized capital gains and losses of each Fund are allocated daily to each class of shares based on the relative net assets of each class. Federal Income Taxes. Each Fund intends to qualify as a regulated investment company and distribute substantially all of its taxable income and net realized gains, if applicable, to shareholders. Accordingly, no provision for Federal income taxes has been made. Financing Transactions. Certain Funds may enter into financing transactions consisting of the sale by the Fund of securities, together with a commitment to repurchase similar securities at a future date. The difference between the selling price and the future purchase price is an adjustment to interest income. If the counterparty to whom the Fund sells the security becomes insolvent, a Fund's right to repurchase the security may be restricted; the value of the security may change over the term of the financing transaction; and the return earned by a Fund with the proceeds of a financing transaction may not exceed transaction costs. Futures and Options. Certain Funds are authorized to enter into futures contracts and options. A Fund may use futures contracts and options to manage its exposure to the securities markets or to movements in interest rates and currency values. The primary risks associated with the use of futures contracts and options are imperfect correlation between the change in market value of the securities held by a Fund and the prices of futures contracts and options, the possibility of an illiquid market, and the inability of the counterparty to meet the terms of the contract. Futures contracts and purchased options are valued based upon their quoted daily settlement prices. The premium received for a written option is recorded as an asset with an equal liability which is marked to market based on the option's quoted daily settlement price. Fluctuations in the value of such instruments are recorded as unrealized appreciation (depreciation) until terminated, at which time realized gains and losses are recognized. Forward Currency Transactions. Certain Funds are authorized to enter into forward foreign exchange contracts for the purpose of hedging against foreign exchange risk arising from the Fund's investment or anticipated investment in securities denominated in foreign currencies. A Fund also may enter into these contracts for purposes of increasing exposure to a foreign currency or to shift exposure to foreign currency fluctuations from one country to another. All commitments are marked to market daily at the applicable translation rates and any resulting unrealized gains or losses are recorded. Realized gains or losses are recorded at the time the forward contract matures or by delivery of the currency. Risks may arise upon entering into these contracts from the potential inability of counterparties to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Short Sales. Certain Funds have entered into short sales transactions during the fiscal year. A short sale is a transaction in which a Fund sells securities it does not own in anticipation of a decline in the market price of the securities. The Fund is obligated to deliver securities at the market price at the time the short position is closed. Possible losses from short sales may be unlimited, whereas losses from purchases cannot exceed the total amount invested. Swaps. Certain Funds are authorized to enter into interest rate, total return and currency exchange swap agreements in order to obtain a desired return at a lower cost than if the Fund had invested directly in the asset that yielded the desired return. Swaps involve commitments to exchange components of income (generally interest or returns) pegged to the underlying assets based on a notional principal amount. Swaps are marked to market daily based upon quotations from market makers and the change, if any, is recorded as unrealized gains or losses in the Statements of Operations. A Fund bears the risk of loss of the amount expected to be received under a swap agreement in the event of the default or bankruptcy of a counterparty. Stripped Mortgage-Backed Securities (SMBS). SMBS represent a participation in, or are secured by and payable from, mortgage loans on real property, and may be structured in classes with rights to receive varying proportions of principal and interest. SMBS include interest-only securities (IOs), which receive all of the interest, and principal-only securities (POs), which receive all of the principal. If the underlying mortgage assets experience greater than anticipated payments of principal, a Fund may fail to recoup some or all of its initial investment in these securities. The market value of these securities is highly sensitive to changes in interest rates. 128 PIMCO Funds Annual Report | 3.31.01 Delayed Delivery Transactions. Certain Funds may purchase or sell securities on a when-issued or delayed delivery basis. These transactions involve a commitment by a Fund to purchase or sell securities for a predetermined price or yield, with payment and delivery taking place beyond the customary settlement period. When delayed delivery purchases are outstanding, a Fund will set aside and maintain until the settlement date in a segregated account, liquid assets in an amount sufficient to meet the purchase price. When purchasing a security on a delayed delivery basis, a Fund assumes the rights and risks of ownership of the security, including the risk of price and yield fluctuations, and takes such fluctuations into account when determining its net asset value. A Fund may dispose of or renegotiate a delayed delivery transaction after it is entered into, and may sell when-issued securities before they are delivered, which may result in a capital gain or loss. When the Fund has sold a security on a delayed delivery basis, the Fund does not participate in future gains and losses with respect to the security. Forward sales commitments are accounted for by the Fund in the same manner as forward currency contracts discussed above. Inflation-Indexed Bonds. Inflation-indexed bonds are fixed income securities whose principal value is periodically adjusted to the rate of inflation. The interest rate on these bonds is generally fixed at issuance at a rate lower than typical bonds. Over the life of an inflation-indexed bond, however, interest will be paid based on a principal value which is adjusted for inflation. Any increase in the principal amount of an inflation-indexed bond will be considered interest income, even though principal is not received until maturity. Repurchase Agreements. Each Fund may engage in repurchase transactions. Under the terms of a typical repurchase agreement, the Fund takes possession of an underlying debt obligation subject to an obligation of the seller to repurchase, and the Fund to resell, the obligation at an agreed-upon price and time. The market value of the collateral must be equal at all times to the total amount of the repurchase obligations, including interest. Generally, in the event of counterparty default, the Fund has the right to use the collateral to offset losses incurred. Reverse Repurchase Agreements. Certain Funds are authorized to enter into reverse repurchase agreements. In a reverse repurchase agreement, the Fund sells to a financial institution a security that it holds with an agreement to repurchase the same security at an agreed-upon price and date. A reverse repurchase agreement involves the risk that the market value of the security sold by the Fund may decline below the repurchase price of the security. Restricted Securities. Certain Funds are permitted to invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. 3. Fees, Expenses, and Related Party Transactions Investment Advisory Fee. Pacific Investment Management Company (PIMCO) is a wholly-owned subsidiary partnership of PIMCO Advisors L.P. and serves as investment adviser (the "Adviser") to the Trust, pursuant to an investment advisory contract. The Adviser receives a monthly fee from each Fund at an annual rate based on average daily net assets of the Fund. The Advisory Fee is charged at an annual rate of 0.20% for the Short Duration Municipal Income Fund; 0.40% for the Convertible and StocksPLUS Funds; 0.45% for Emerging Markets Bond Fund; and 0.25% for all other Funds. Administration Fee. Pacific Investment Management Company (PIMCO) is a wholly-owned subsidiary partnership of PIMCO Advisors L.P. which also serves as administrator (the "Administrator"), and provides administrative services to the Trust for which it receives from each Fund a monthly administrative fee based on each share class' average daily net assets. The Administration Fee for Class D is charged at the annual rate of 0.25% for the Low Duration, Short-Term, and Total Return Funds; 0.35% for the California Intermediate Municipal Bond, California Municipal Bond, Municipal Bond, New York Municipal Bond and Short Duration Municipal Bond Funds; 0.45% for the Foreign Bond Fund; 0.55% for Emerging Markets Bond Fund; and 0.40% for all other Funds. The Administration Fee for the Institutional and Administrative Class is charged at the annual rate of 0.18% for the Low Duration and Total Return Funds; 0.19% for the Short Duration Municipal Income Fund; 0.20% for the Short-Term Fund; 0.24% for the California Intermediate Municipal Bond, California Municipal Bond and New York Intermediate Municipal Bond Funds; 0.40% for Emerging Markets Bond Fund; and 0.25% for all other Funds. The Administration Fee for the A, B and C Classes is charged at an annual rate of 0.35% for the California Intermediate Municipal Bond, California Municipal Bond, Municipal Bond, New York Intermediate Municipal Bond and Short-Term Funds; 0.45% for Foreign Bond Fund; 0.55% for Emerging Markets Bond Fund; and 0.40% for all other Funds. 3.31.01 | PIMCO Funds Annual Report 129 PIMCO Notes to Financial Statements Class D (Cont.) March 31, 2001 Strategic Balanced Fund Fees. Effective September 29, 2000, the Strategic Balanced Fund changed investment objectives to a "fund of funds" and as such does not pay any fees to PIMCO under the Trust's investment advisory agreement in return for the advisory and asset allocation services provided by PIMCO. The Fund does, however, indirectly pay its proportionate share of the advisory fees paid to PIMCO by the Underlying Funds in which the Fund invests. The Fund pays administrative fees to PIMCO at an annual rate of 0.05% based on the average daily net assets attributable in the aggregate to the Fund's Institutional Class and Administrative Class shares. The Fund also indirectly pays its proportionate share of the administrative fees charged by PIMCO to the Underlying Funds in which the Fund invests. Distribution and Servicing Fees. PIMCO Funds Distributors LLC, ("PFD"), formerly PIMCO Funds Distribution Company, a wholly-owned subsidiary of PIMCO Advisors L.P., serve as the distributor of the Trust's shares. The Trust is permitted to reimburse, out of the Administrative Class assets of each Fund offering Administrative Class shares in an amount up to 0.25% on an annual basis of the average daily net assets of that class, financial intermediaries that provide services in connection with the distribution of shares or administration of plans or programs that use Fund shares as their funding medium. The effective rate paid to PFD was 0.25% during current fiscal year. Pursuant to the Distribution and Serving Plans adopted by the A, B, C and D Classes of the Trust, the Trust compensates PFD or an affiliate with respect to Class D for services provided and expenses incurred in connection with assistance rendered in the sales of shares and services rendered to shareholders and for maintenance of shareholder accounts of the A, B, C, and D Classes. The Trust paid PFD distribution and servicing fees at effective rate as set forth below (calculated as a percentage of each Fund's average daily net assets attributable to each class): Allowable Rate -------------------------------- Distribution Servicing Fee (%) Fee (%) -------------------------------------------------------------------------------- Class A All other Funds -- 0.25 Class B All Funds 0.75 0.25 Class C Foreign Bond, High Yield Total Return and Total Return Mortgage Funds 0.75 0.25 Municipal Bond, Real Return Bond Low Duration and StocksPLUS Funds 0.50 0.25 Short-Term Fund 0.30 0.25 Class D All Funds -- 0.25 PFD also receives the proceeds of the initial sales charges paid by the shareholders upon the purchase of Class A shares, except for the Money Market Fund, and the contingent deferred sales charges paid by the shareholders upon certain redemptions of A, B and C Class shares. For the period ended March 31, 2001, PFD received $12,314,722 representing commissions (sales charges) and contingent deferred sales charges. Expenses. The Trust is responsible for the following expenses: (i) salaries and other compensation of any of the Trust's executive officers and employees who are not officers, directors, stockholders or employees of PIMCO or its subsidiaries or affiliates; (ii) taxes and governmental fees; (iii) brokerage fees and commissions and other portfolio transaction expenses; (iv) the costs of borrowing money, including interest expense; (v) fees and expenses of the Trustees who are not "interested persons" of PIMCO or the Trust, and any counsel retained exclusively for their benefit; (vi) extraordinary expenses; (vii) organization expense and (viii) any expenses allocated or allocable to a specific class of shares, which include service fees payable with respect to the Administrative Class shares and may include certain other expenses as permitted by the Trust's Multiple Class Plan adopted pursuant to Rule 18f-3 under the Act and subject to review and approval by the Trustees. The ratio of expenses to average net assets per share class, as disclosed in Financial Highlights, may differ from the annual fund operating expenses per share class as disclosed in the Prospectus for the reasons set forth above. PIMCO has agreed to waive a portion of Convertible, Short Duration Municipal Income, California Intermediate Municipal Bond, California Municipal Bond Fund and New York Municipal Bond Funds administrative fees to the extent that the payment of each Fund's pro rata share of Trustee fees and organizational expenses causes the actual expense ratio to rise above the rates disclosed in the then-current prospectus plus 0.49 basic points as set forth below (calculated as a percentage of each Fund's average daily net assets attributable to each class):
Inst'l Class Admn Class Class A Class B Class C Class D --------------------------------------------------------------------------------------------------------------- Convertible Bond Fund 0.65% 0.90% 1.05% 1.80% 1.80% 1.05% Short Duration Municipal Income Fund 0.39% 0.64% -- -- -- 0.80% California Intermediate Municipal Bond Fund 0.49% 0.75% 0.85% -- -- 0.85% California Municipal Bond Fund 0.49% 0.74% 0.85% -- -- 0.85% New York Municipal Bond Fund 0.49% 0.74% 0.89% -- -- 0.87%
PIMCO may be reimbursed for these waived amounts in the future periods. 130 PIMCO Funds Annual Report | 3.31.01 Each unaffiliated Trustee receives an annual retainer of $45,000**, plus $3,000 for each Board of Trustees meeting attended in person and $500 for each meeting attended telephonically, plus reimbursement of related expenses. In addition, each committee chair receives an annual retainer of $1,500. These expenses are allocated to the Funds of the Trust according to their respective net assets. ** Effective January 1, 2001, the annual retainer for the unaffiliated Trustee is equal to $60,000. 4. Purchases and Sales of Securities Purchases and sales of securities (excluding short-term investments) for the period ended March 31, 2001 were as follows (amounts in thousands):
U.S. Government/Agency All Other ---------------------------------------------------------------------- Purchases Sales Purchases Sales ---------------------------------------------------------------------------------------------------------------- California Intermediate Municipal Bond Fund $ 108 $ 0 $ 49,465 $ 38,049 California Municipal Bond Fund 218 0 327,131 238,379 Convertible Fund 0 0 306,691 337,797 Emerging Markets Bond Fund 0 0 430,286 410,116 Foreign Bond Fund 2,889,041 2,885,954 1,374,920 1,157,516 High Yield Fund 0 0 1,404,633 1,942,746 Low Duration Fund 20,847,584 18,096,892 2,684,950 1,693,694 Municipal Bond Fund 108 0 218,600 193,470 New York Municipal Bond Fund 0 0 32,246 31,733 Real Return Bond Fund 2,672,335 2,007,218 592,915 86,773 Short Duration Municipal Income Fund 0 0 30,583 28,172 Short-Term Fund 1,098,486 721,233 534,843 255,803 StocksPLUS Fund 3,196,677 2,697,059 707,315 830,795 Strategic Balanced Fund 457,515 496,733 130,468 151,976 Total Return Fund 222,602,527 197,986,156 24,585,355 29,666,864 Total Return Mortgage Fund 191,474 166,061 8,458 1,769
5. Acquisition by Allianz AG On May 5, 2000, Allianz AG completed the acquisition of approximately 70% of the outstanding partnership interest in PIMCO Advisors L.P. ("PIMCO Advisors"), of which PIMCO is a subsidiary partnership. As a result of this transaction, PIMCO Advisors, and its subsidiaries, are now controlled by Allianz AG, a leading provider of financial services, particularly in Europe. PIMCO remains operationally independent, continues to operate under its existing name, and now leads the global fixed-income efforts of Allianz AG. Key employees at each PIMCO Advisors' investment units, including PIMCO's Bill Gross, have signed long-term employment contracts and have significant profit-sharing and retention arrangements to ensure continuity of the investment process and staff. The Allianz Group manages assets of approximately (euro)713.3 billion as of December 31, 2000, including more than 300 mutual funds for retail and institutional clients around the world. 6. In-Kind Transactions For the period ended March 31, 2001, the following funds realized gains or losses from in-kind redemptions of approximately (amounts in thousands): Realized Gains Realized Losses -------------------------------------------------------------------------------- High Yield Fund $ 0 $ (70,521) Strategic Balanced Fund 59 0 7. Federal Income Tax Matters As of March 31, 2001, the Funds listed in the table below had remaining capital loss carryforwards that were realized or acquired in prior years. Use of the acquired capital loss carryforwards may be limited under current tax laws. Additionally, the California Intermediate Municipal Bond, Convertible, Foreign Bond, High Yield, Low Duration, Real Return, Short-Term, StocksPLUS and Total Return Funds realized capital losses and/or foreign currency losses during the period November 1, 2000 through March 31, 2001 which the Funds elected to defer to the following fiscal year pursuant to income tax regulations. The amounts are $75,517, $5,480,569, $7,607,826, $57,057,816, $11,492,366, $243,361, $721,218, $214,462,097, $17,936,702, respectively. Each Fund will resume capital gain distributions in the future to the extent gains are realized in excess of the available carryforwards. Capital Loss Carryforwards -------------------------------------------------- Realized Losses Acquired Losses Expiration -------------------------------------------------------------------------------- High Yield Fund $150,615,064 $ 0 3/31/2009 High Yield Fund 39,492,722 0 3/31/2008 High Yield Fund 0 48,559,227 3/31/2003 Low Duration Fund 36,222,381 0 3/31/2008 Short-Term Fund 326,974 0 3/31/2009 Short-Term Fund 412,413 0 3/31/2008 Short-Term Fund 109,956 0 3/31/2007 Stock PLUS Fund 86,222,244 0 3/31/2009 Strategic Balanced Fund 1,711,676 0 3/31/2009 Convertible Fund 3,488,828 0 3/31/2009 3.31.01 | PIMCO Funds Annual Report 131 PIMCO Notes to Financial Statements Class D (Cont.) March 31, 2001 8. Shares of Beneficial Interest The Trust may issue an unlimited number of shares of beneficial interest with a $.0001 par value. Changes in shares of beneficial interest were as follows (shares and amounts in thousands):
California California Intermediate Municipal Municipal Bond Fund Bond Fund Year Ended Period from 08/31/1999 Period from 05/16/2000 03/31/2001 to 03/31/2000 to 03/31/2001 Shares Amount Shares Amount Shares Amount Receipts for shares sold Class D 17 $ 178 1 $ 10 1 $ 10 Other Classes 15,424 156,058 1,075 10,729 2,185 21,945 Shares issued in reorganization Class D 0 0 0 0 0 0 Other Classes 0 0 0 0 0 0 Issued as reinvestment of distributions Class D 0 2 0 0 0 1 Other Classes 408 4,237 10 103 79 810 Cost of shares redeemed Class D (1) (12) 0 0 0 0 Other Classes (5,687) (58,411) (68) (675) (1,042) (10,700) Net increase (decrease) resulting from Fund share transactions 10,161 $ 102,052 1,018 $ 10,167 1,223 $ 12,066 -------------------------------------- ------------------------------------------------------- ------------------------ Convertible Fund Year Ended Year Ended 03/31/2001 03/31/2000 Shares Amount Shares Amount Receipts for shares sold Class D 0 $ 0 1 $ 10 Other Classes 8,226 113,053 14,353 190,493 Shares issued in reorganization Class D 0 0 0 0 Other Classes 0 0 0 0 Issued as reinvestment of distributions Class D 0 1 0 0 Other Classes 644 8,646 145 2,104 Cost of shares redeemed Class D 0 0 0 0 Other Classes (12,459) (161,679) (2,824) (42,473) Net increase (decrease) resulting from Fund share transactions (3,589) $ (39,979) 11,675 $ 150,134 --------------------------------------- -------------------------------------------------------
Municipal Bond Fund Year Ended Year Ended 03/31/2001 03/31/2000 Shares Amount Shares Amount Receipts for shares sold Class D 444 $ 4,243 251 $ 2,373 Other Classes 4,458 43,041 2,204 21,145 Shares issued in reorganization Class D 0 00 00 0 Other Classes 0 00 00 0 Issued as reinvestment of distributions Class D 3 33 2 18 Other Classes 192 1,851 169 1,620 Cost of shares redeemed Class D (422) (4,028) (161) (1,512) Other Classes (2,229) (21,456) (2,700) (25,741) Net increase (decrease) resulting from Fund share transactions 2,446 $ 23,684 (235) $ (2,097) ---------------------------------------------------- ----------------------------------------------------------------------- New York Municipal Bond Fund Year Ended Period from 08/31/1999 03/31/2001 to 03/31/2000 Shares Amount Shares Amount Receipts for shares sold Class D 10 $ 100 1 $ 10 Other Classes 45 485 301 3,010 Shares issued in reorganization Class D 0 0 0 0 Other Classes 0 0 0 0 Issued as reinvestment of distributions Class D 0 1 0 0 Other Classes 17 172 8 76 Cost of shares redeemed Class D 0 0 0 0 Other Classes (1) (11) 0 0 Net increase (decrease) resulting from Fund share transactions 71 $ 747 310 $ 3,096 ---------------------------------------------------- ---------------------------------------------------------------------
132 PIMCO Funds Annual Report | 3.31.01
Emerging Markets Bond Fund Foreign Bond Fund Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount 0 $ 0 $ 1 10 1,829 $ 18,523 785 $ 8,012 4,706 39,107 5,669 43,459 24,700 249,638 24,699 251,525 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 118 1,188 69 698 769 6,408 234 1,876 3,864 38,972 3,422 34,688 0 0 0 0 (364) (3,687) (662) (6,691) (1,862) (15,451) (3,278) (25,312) (19,178) (193,686) (32,310) (328,315) 3,613 $ 30,065 2,626 $ 20,033 10,969 $ 110,948 (3,997) $ (40,083) ----------------------------------------------------------------------------------------------------------------------------------- High Yield Fund Low Duration Fund Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount 4,348 $ 43,592 2,194 $ 23,790 1,166 $ 11,532 968 $ 9,569 149,244 1,495,450 189,148 2,050,531 288,619 2,847,901 349,686 3,465,383 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 219 1,982 142 1,515 94 930 55 544 18,676 186,848 22,334 240,203 25,011 247,021 22,786 225,453 (3,552) (35,803) (835) (8,901) (563) (5,571) (438) (4,329) (211,435) (2,094,049) (189,837) (2,025,795) (262,275) (2,586,732) (349,184) (3,454,487) (42,500) $ (401,980) 23,146 $ 281,343 52,052 $ 515,081 23,873 $ 242,133 ------------------------------------------------------------------------------------------------------------------------------------ Short Duration Real Return Bond Fund Municipal Income Fund Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount 4,568 $ 46,212 1,714 $ 16,706 0 $ 0 1 $ 10 66,677 671,659 24,213 236,282 1,361 13,744 1,050 10,500 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 243 2,445 33 319 0 0 0 0 3,652 36,769 563 5,502 57 575 24 241 (830) (8,355) (197) (1,910) 0 0 0 0 (15,088) (151,955) (1,964) (19,148) (1,149) (11,638) 0 0 59,222 $ 596,775 24,362 $ 237,751 269 $ 2,681 1,075 $ 10,751 --------------------------------------------------------------- ---------------------------------------------------------------- Short-Term Fund StocksPLUS Fund Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount 564 $ 5,633 462 $ 4,614 73 $ 918 178 $ 2,553 67,956 678,100 135,826 1,354,008 32,223 414,370 55,051 792,443 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 32 319 20 195 21 263 38 534 3,312 33,061 2,701 26,908 7,992 97,921 17,123 239,951 (275) (2,748) (371) (3,698) (55) (707) (103) (1,416) (77,930) (777,538) (127,382) (1,269,938) (46,334) (593,381) (49,851) (708,774) (6,341) $ (63,173) 11,256 $ 112,089 (6,080) $ (80,616) 22,436 $ 325,291 --------------------------------------------------------------- ----------------------------------------------------------------
3.31.01 | PIMCO Funds Annual Report 133 PIMCO Notes to Financial Statements Class D (Cont.) March 31, 2001 Shares of Beneficial Interest (Cont.) The Trust may issue an unlimited number of shares of beneficial interest with a $.0001 par value. Changes in shares of beneficial interest were as follows (shares and amounts in thousands):
Strategic Balanced Fund Total Return Fund Year Ended Year Ended Year Ended Year Ended 03/31/2001 03/31/2000 03/31/2001 03/31/2000 Shares Amount Shares Amount Shares Amount Shares Amount Receipts for shares sold Class D 59 $ 690 9 $ 124 21,251 $ 218,432 7,143 $ 71,612 Other Classes 1,093 12,850 1,650 21,377 1,579,234 16,128,071 1,337,995 13,430,759 Shares issued in reorganization Class D 0 0 0 0 0 0 0 0 Other Classes 0 0 5,137 66,780 0 0 0 0 Issued as reinvestment of distributions Class D 4 41 1 15 888 9,094 332 3,317 Other Classes 691 7,964 715 9,186 180,718 1,841,940 140,752 1,410,633 Cost of shares redeemed Class D (15) (181) (11) (141) (5,026) (51,706) (2,759) (27,553) Other Classes (6,821) (86,065) (3,062) (39,025) (902,707) (9,194,347) (838,481) (8,391,495) Net increase (decrease) resulting from Fund share transactions (4,989) $(64,701) 4,439 $58,316 874,358 $8,951,490 644,982 $6,497,273 -------------------------------------------------------------------------------------------------------------------- Total Return Mortgage Fund Year Ended Year Ended 03/31/2001 03/31/2000 Shares Amount Shares Amount 108 $ 1,122 18 $ 176 2,331 23,394 5 51 0 0 0 0 0 0 0 0 4 38 1 5 130 1,336 24 235 (9) (89) (21) (212) (575) (5,907) (34) (342) 1,989 $19,894 (7) $ (87) ---------------------------------
9. Transactions in Written Call and Put Options Transactions in written call and put options were as follows (amounts in thousands):
Foreign Bond Low Duration StocksPLUS Strategic Balanced Total Return Fund Fund Fund Fund Fund Premium Balance at 03/31/2000 $ 473 $ 3,873 $ 1,231 $ 692 $ 31,722 Sales 1,986 3,939 9,853 643 53,504 Closing Buys (424) (361) 3,255 (275) (29,554) Expirations (1,329) (3,597) (13,583) (1,060) (18,184) Exercised (10) (2,032) 0 0 (215) ----------------------------------------------------------------------------------------------------------------------------------- Balance at 03/31/2001 $ 696 $ 1,822 $ 756 $ 0 $ 37,273 -----------------------------------------------------------------------------------------------------------------------------------
10. Reorganization The Acquiring Fund, as listed below, acquired the assets and certain liabilities of the Acquired Fund, also listed below, in a tax-free exchange for shares of the Acquiring Fund, pursuant to a plan of reorganization approved by the Acquired Fund's shareholders (amounts in thousands):
Value of Total Net Shares Shares Total Net Total Net Assets of Acquired Issued by Issued by Assets of Assets of Acquiring Fund's Acquiring Acquiring Acquired Acquiring Fund After Unrealized Acquiring Fund Acquired Fund Date Fund Fund Fund Fund Acquisition Depreciation PIMCO PIMCO Strategic Balanced Fund Balanced Fund 09/17/1999 5,137 $ 66,780 $ 66,780 $105,993 $172,774 $ (45)
134 PIMCO Funds Annual Report | 3.31.01 PIMCO Report of Independent Accountants Class D To the Trustees and Class D Shareholders of the PIMCO Funds: Pacific Investment Management Series In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations, of changes in net assets and of cash flows and the financial highlights for the Class D shares present fairly, in all material respects, the financial position of the California Intermediate Municipal Bond Fund, California Municipal Bond Fund, Convertible Fund, Emerging Markets Bond Fund, Foreign Bond Fund, High Yield Fund, Low Duration Fund, Municipal Bond Fund, New York Municipal Bond Fund, Real Return Bond Fund, Short Duration Municipal Bond Fund, Short-Term Fund, StocksPLUS Fund, Strategic Balanced Fund, Total Return Fund, and Total Return Mortgage Fund (hereafter referred to as the "Funds") at March 31, 2001, the results of each of their operations, the changes in each of their net assets and cash flows for the Foreign Bond Fund, Short-Term Fund and Real Return Bond Fund and the financial highlights for the Class D shares for each of the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Funds' management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with auditing standards generally accepted in the United States of America which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at March 31, 2001 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion. PricewaterhouseCoopers LLP Kansas City, Missouri May 23, 2001 3.31.01 | PIMCO Funds Annual Report 135 PIMCO Federal Income Tax Information Class D As required by the Internal Revenue Code regulations, shareholders must be notified within 60 days of the Trust's fiscal year end (March 31, 2001) regarding the status of the dividend received deduction for corporations. Dividend Received Deduction. Corporate shareholders are generally entitled to take the dividend received deduction on the portion of a Fund's dividend distribution that qualifies under tax law. The percentage of the following Fund's fiscal 2001 ordinary income dividends that qualifies for the corporate dividend received deduction is set forth below: Convertible Fund 17.46% Foreign Bond Fund 0.41% High Yield Fund 2.99% Low Duration Fund 2.55% StocksPLUS Fund 15.77% Strategic Balanced Fund 7.48% Total Return Fund 1.22% For the benefit of shareholders of the California Municipal Bond, California Intermediate Municipal Bond, Municipal Bond, Short Duration Municipal Income, and New York Municipal Bond Funds, this is to inform you that 100.00%, 100.00%, 100.00%, 97.83%, and 100.00%, respectively, of the dividends paid by the Funds during its fiscal year qualify as exempt-interest dividends. Shareholders are advised to consult their own tax advisor with respect to the tax consequences of their investment in the Trust. In January 2002, you will be advised on IRS Form 1099-DIV as to the federal tax status of the dividends and distributions received by you in calendar year 2001. PIMCO Funds: Pacific Investment Management Series Manager Pacific Investment Management Company, 840 Newport Center Drive, Suite 300, Newport Beach, CA 92660 Distributor PIMCO Funds Distributors LLC, 2187 Atlantic Street, Stamford, CT 06902 Custodian State Street Bank & Trust Co., 801 Pennsylvania, Kansas City, MO 64105 Shareholder PFPC Global Fund Services, Inc., P.O. Box 9688, Servicing Agent and Providence, RI 02940-9688 Transfer Agent Independent PricewaterhouseCoopers LLP, 1055 Broadway, Kansas City, Accountant MO 64105 Legal Counsel Dechert, 1775 Eye Street, Washington, DC 20006 For Account For PIMCO Funds account information contact your Information financial advisor, or if you receive account statements directly from PIMCO Funds, you can also call 1-800-426-0107. Telephone representatives are available Monday-Friday 8:30 am to 8:00 pm Eastern Time. 136 PIMCO Funds Annual Report | 3.31.01 HOW TO CONTACT US For information regarding your investment contact your financial advisor, or call: Shareholder Services 1-800-426-0107 For general information: 1-888-87-PIMCO PIMCO Funds Online www.pimcofunds.com Access Staff Editor Ruth Straughn Design Wendy Berge What do you think? To provide feedback on access, e-mail us at: accessmag@pimcofunds.com. Or write to: PIMCO Funds, 2187 Atlantic Street, Stamford, CT 06902, Attention: Access Editor. PIMCO Funds offers access to the specialized investment expertise of PIMCO Advisors L.P. (PIMCO). PIMCO manages over $270 billion and has a client list that includes 63 of the 100 largest U.S. corporations. The firm is a member of the Allianz Group, one of the world's leading financial services providers. Stock Funds -------------------------------------------------------------------------------- Growth Growth Fund Select Growth Fund Target Fund Blend Growth & Income Fund Capital Appreciation Fund Mid-Cap Fund Value Renaissance Fund Value Fund Enhanced Index Tax-Efficient Equity Fund StocksPLUS Fund Sector-Related Innovation Fund Global Innovation Fund Healthcare Innovation Fund Stock and Bond Funds -------------------------------------------------------------------------------- Strategic Balanced Fund Bond Funds -------------------------------------------------------------------------------- Short Duration Short-Term Fund Low Duration Fund Intermediate Duration Total Return Fund Total Return Mortgage Fund Short Duration Municipal Bond Fund Tax-Exempt Short Duration Municipal Income Fund Municipal Bond Fund CA Interm. Municipal Bond Fund NY Municipal Bond Fund CA Municipal Bond Fund Inflation-Indexed Real Return Bond Fund International Foreign Bond Fund Emerging Markets Bond Fund High Yield High Yield Fund Convertible Convertible Fund (C) 2001 PIMCO Funds Distributors, LLC This material is authorized for use only when preceded or accompanied by a current PIMCO Funds prospectus, which describes in greater detail the investment policies, management fees and other matters of interest to prospective investors. Please read the prospectus carefully before you invest or send money. Although carefully verified, data is not guaranteed as to accuracy or completeness. PIMCO Funds can not be held responsible for any loss incurred by applying any information in this publication. Shareholder Communications Now Available Online [GRAPHIC] PIMCO Funds is pleased to announce that you can now elect to receive your shareholder communications online. This new service, called eDelivery, allows you to access annual and semi-annual reports, prospectuses and proxy statements through the Internet--eliminating the paper mailings you've received in the past. Why sign up? eDelivery provides you with several important benefits, including: . Faster delivery than regular mail . Convenient access to valuable information . Environmentally sound. [GRAPHIC] How it works To sign up for eDelivery, go to www.pimcofunds.com/edelivery and complete the short enrollment form. As communications become available, we will send you an e-mail notification containing the Internet address where you can view and print the materials. For more information on this valuable new service, turn to page 5 in this magazine. PZ035.4/01 -------------------------------------------------------------------------------- www.pimcofunds.com -------------------------------------------------------------------------------- [LOGO OF PIMCO FUNDS] PIMCO Funds Distributors LLC 2187 Atlantic Street Stamford, CT 06902-6896 [LOGO OF PIMCO FUNDS] PRIVATE ACCOUNT PORTFOLIO SERIES ANNUAL REPORT March 31, 2001 The Portfolios issue shares only in private placement transactions in accordance with Regulation D or other applicable exemptions under the Securities Act of 1933, as amended (the "Securities Act"). The enclosed Annual Report is not an offer to sell, or a solicitation of any offer to buy, any security to the public within the meaning of the Securities Act. Contents Chairman's Message ............................................................1 Financial Highlights .........................................................12 Statements of Assets and Liabilities .........................................14 Statements of Operations .....................................................16 Statements of Changes in Net Assets ..........................................18 Statements of Cash Flows .....................................................20 Notes to Financial Statements ................................................56 Report of Independent Accountants ............................................61
Fund Schedule of Summary Investments Short-Term Portfolio ..........................................................2 21 U.S. Government Sector Portfolio ..............................................3 23 Investment Grade Corporate Portfolio ..........................................4 26 High Yield Portfolio ..........................................................5 30 Mortgage Portfolio ............................................................6 33 Asset-Backed Securities Portfolio .............................................7 42 Real Return Bond Portfolio ....................................................8 43 International Portfolio .......................................................9 45 Emerging Markets Portfolio ...................................................10 52 Municipal Sector Portfolio ...................................................11 54
Chairman's Letter Dear PIMCO Funds Shareholder: We are pleased to present you with this annual report for the Private Account Portfolio Series, the separate portfolios of the PIMCO Funds: Pacific Investment Management Series. During the Private Account Portfolio Series' fiscal year, assets grew by $5.7 billion to finish the 12-month period ended March 31, 2001 at $10.3 billion. Strongly positive returns from fixed income securities helped anchor diversified portfolios during a year in which many major global stock markets finished in negative territory. The Lehman Brothers Aggregate Bond Index, generally regarded as representative of the bond market as a whole, increased 12.53% over the fiscal year. Stocks retreated as the correction in the technology sector that began during 2000 spread to other industries. Investors looking for safety pushed Treasury yields lower during the latter part of the fiscal year, with short and intermediate maturities falling the most. The 3-month Treasury yield decreased 1.58% over the course of the year to finish at 4.28%. The 2- to 30-year portion of the yield curve steepened sharply as the 2-year yield dropped 2.30% while the 30-year yield dropped slightly by 0.38%. The 10-year yield fell 1.09% to close at 4.92%. The Fed left the fed funds rate unchanged during the second half of 2000 after last increasing the rate 0.50% to 6.50% in May 2000, the last of six rate hikes since June 1999. The central bank shifted emphasis away from inflation at its December meeting and set the stage for an easing cycle. U.S. growth slowed to 1.0% in the final quarter of 2000, the weakest pace in more than five years. This sudden deceleration prompted two 0.50% fed funds rate cuts by the Fed in January to prevent a slowdown from turning into a recession. Signs of economic weakness continued to mount, however, including a relentless procession of profit warnings from companies in a diverse range of industries. On March 20, the Fed reduced the fed funds rate an additional 0.50% and suggested that more easing could soon be on the way. The central bank stated in its accompanying press release that it "will need to monitor events closely" as "the economic situation could be evolving rapidly." Consumer confidence revived late in the quarter as employment levels remained relatively high. Even so, pessimists who thought the Fed should have acted more aggressively at its March meeting could point to retrenchment in business investment as a sign that the economy would continue to weaken. We are pleased to announce the addition of the Asset-Backed Securities Portfolio and the High Yield Portfolio, which began operations in October 2000 and December 2000, respectively. In addition, the Short-Term, Real Return Bond and Municipal Sector Portfolios were launched earlier during the fiscal year in an effort to further compliment our product offering and broaden the range of investment options available to investors. On the following pages you will find specific details as to each Portfolio's composition and total return investment performance including a discussion of those factors that affected investment performance. We appreciate the trust you have placed in us through your investments, and we will continue to focus our efforts to meet your investment needs. If you have any questions regarding your PIMCO Funds investment, please contact your account manager, or call one of our shareholder associates at 1-800-927-4648. We also invite you to visit our Web site at www.pimco.com. Sincerely, /s/ Brent R. Harris Brent R. Harris Chairman of the Board April 30, 2001 2001 Annual Report 1 PIMCO Short-Term Portfolio -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with preservation of capital and daily liquidity Portfolio: Primarily money market instruments and short duration fixed income securities Duration: 0.7 years Total Net Assets: $191.3 million Sector Breakdown:* [GRAPH] Mortgage-Backed Securities 48.1% Corporate Bonds & Notes 32.9% Asset-Backed Securities 6.6% Other 12.4% Quality Breakdown:* [GRAPH] AAA 46.4% AA 3.4% A 23.4% BBB 26.8% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001 Short-Term Portfolio Salomon 3-Month (Incep. 4/20/2000) Treasury Bill Index 6 Months 3.75% 2.99% Since Inception 7.62% -- Cumulative Returns Through March 31, 2001 $5,000,000 invested at inception [GRAPH] SHORT TERM PORTFOLIO Salomon Short-Term 3-Month Treasury MONTH Portfolio Bill Index -------------------------------------------------------------------------------- 04/30/2000 5,000,000 5,000,000 05/31/2000 5,025,000 5,024,500 06/30/2000 5,065,135 5,048,115 07/31/2000 5,100,450 5,072,346 08/31/2000 5,140,809 5,097,453 09/30/2000 5,186,575 5,122,941 10/31/2000 5,212,251 5,149,785 11/30/2000 5,248,198 5,176,049 12/31/2000 5,285,949 5,203,482 01/31/2001 5,301,760 5,230,541 02/28/2001 5,343,921 5,253,032 03/31/2001 5,380,874 5,276,144 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that Portfolio shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 5/01/2000, the first full month following the Portfolio's inception on 4/20/00, compared to the Salomon 3-Month Treasury Bill Index, an unmanaged market index. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The Short-Term Portfolio returned 3.75% for the six-month period ended March 31, 2001, outperforming the Salomon 3-Month Treasury Bill Index return of 2.99%. . An above-Index duration boosted returns as short-term interest rates fell significantly. . An allocation to mortgage-backed securities was neutral for performance as higher yields heightened market volatility and rising prepayments put pressure on prices. . The Portfolio's investment-grade corporate holdings slightly enhanced performance as Fed easing sparked a recovery that allowed corporates to gain ground. . Limited holdings of U.S. dollar-denominated emerging markets bonds were positive due to the higher yields provided by these issues and because problem credits were avoided. . Real return bonds added to relative returns, outperforming like-duration Treasuries as real yields fell. 2 PIMCO Funds PIMCO U.S. Government Sector Portfolio -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with prudent investment management Portfolio: Primarily U.S. government securities Duration: 11.6 years Total Net Assets: $1.3 billion Sector Breakdown:* [GRAPH] U.S. Treasury Obligations 48.1% U.S. Government Agencies 23.8% Mortgage-Backed Securities 10.9% Corporate Bonds & Notes 9.2% Other 8.0% Quality Breakdown:* [GRAPH] AAA 87.2% AA 2.9% A 7.6% BBB 2.3% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001 U.S. Government Salomon 3-Month Lehman Brothers Sector Portfolio Treasury Bill Long-Term Government (Incep. 1/31/2000) Index Index 1 Year 16.03% 6.02% 13.21% Since Inception* 20.04% -- -- * Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception $6.3 (in millions) [GRAPH] U.S. GOVERNMENT SECTOR PORTFOLIO Salomon Lehman Brothers U.S. Government 3-Month Treasury Long-Term Government MONTH Sector Portfolio Bill Index Index -------------------------------------------------------------------------------- 01/31/2000 5,000,000 5,000,000 5,000,000 02/29/2000 5,135,000 5,021,499 5,146,501 03/31/2000 5,330,522 5,045,100 5,313,765 04/30/2000 5,295,386 5,068,812 5,269,127 05/31/2000 5,290,367 5,093,649 5,246,995 06/30/2000 5,466,324 5,117,588 5,365,576 07/31/2000 5,537,250 5,142,153 5,456,790 08/31/2000 5,668,968 5,167,606 5,583,386 09/30/2000 5,638,655 5,193,444 5,523,085 10/31/2000 5,741,644 5,220,658 5,610,905 11/30/2000 5,896,128 5,247,283 5,787,085 12/31/2000 6,050,053 5,275,094 5,933,501 01/31/2001 6,098,844 5,302,525 5,948,927 02/28/2001 6,207,268 5,325,326 6,046,489 03/31/2001 6,185,103 5,348,756 6,015,654 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that Portfolio shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 2/01/2000, the first full month following the Portfolio's inception date on 1/31/2000, compared to the Salomon 3-Month Treasury Bill Index and the Lehman Brothers Long-Term Government Index, each an unmanaged market index. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The U.S. Government Sector Portfolio outperformed the Lehman Brothers Long-Term Government Index for the year ended March 31, 2001, returning 16.03% versus 13.21% for the Index. . Extending duration was modestly positive for the year as interest rates generally trended downward. . Premiums from written options were positive as interest rates remained within our anticipated range. . Real return bonds added to relative returns, outperforming like-duration Treasuries as real yields fell. 2001 Annual Report 3 PIMCO Investment Grade Corporate Portfolio -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with prudent investment management Portfolio: Primarily corporate fixed income securities Duration: 4.6 years Total Net Assets: $999.6 million Sector Breakdown:* [GRAPH] Corporate Bonds & Notes 73.0% Short-Term Instruments 14.3% Mortgage-Backed Securities 10.1% Other 2.6% Quality Breakdown:* [GRAPH] AAA 27.0% AA 8.3% A 37.9% BBB 26.8% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001 Investment Grade Salomon 3-Month Lehman Brothers Corporate Portfolio Treasury Bill Intermediate Credit (Incep. 1/26/2000) Index Index 1 Year 11.59% 6.02% 12.40% Since Inception* 11.71% -- -- * Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] INVESTMENT GRADE CORPORATE PORTFOLIO Investment Grade Salomon Lehman Brothers Corporate 3-Month Treasury Intermediate Credit MONTH Portfolio Bill Index Index -------------------------------------------------------------------------------- 01/31/2000 5,000,000 5,000,000 5,000,000 02/29/2000 5,060,120 5,021,499 5,040,872 03/31/2000 5,115,509 5,045,100 5,083,626 04/30/2000 5,080,160 5,068,812 5,054,370 05/31/2000 5,090,260 5,093,649 5,052,015 06/30/2000 5,186,549 5,117,588 5,157,097 07/31/2000 5,227,630 5,142,153 5,204,542 08/31/2000 5,294,388 5,167,606 5,271,160 09/30/2000 5,341,134 5,193,444 5,322,291 10/31/2000 5,351,556 5,220,658 5,327,081 11/30/2000 5,424,508 5,247,283 5,390,473 12/31/2000 5,504,589 5,275,094 5,496,126 01/31/2001 5,606,525 5,302,525 5,612,644 02/28/2001 5,665,541 5,325,326 5,667,648 03/31/2001 5,708,401 5,348,756 5,714,123 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that Portfolio shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 2/01/2000, the first full month following the Portfolio's inception date on 1/26/2000, compared to the Salomon 3-Month Treasury Bill Index and the Lehman Brothers Intermediate Credit Index, each an unmanaged market index. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The Investment Grade Corporate Portfolio returned 11.59% for the year ended March 31, 2001, compared to 12.40% for the Lehman Brothers Intermediate Credit Index. . An above-benchmark duration had a positive impact on returns as interest rates fell. . Underweighting consumer cyclicals added to returns as excess capacity and reduced demand caused this sector to underperform. . An overweight to transportation-related companies, especially Equipment Trust Certificates (ETCs), boosted returns as strong demand more than offset higher oil prices. . A small allocation to mortgage-backed securities detracted slightly from returns as recent interest rate volatility caused this sector to underperform. 4 PIMCO Funds PIMCO High Yield Portfolio -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with prudent investment management Portfolio: Primarily higher yielding fixed income securities Duration: 4.3 years Total Net Assets: $212.2 million -------------------------------------------------------------------------------- PORTFOLIO COMPOSITION -------------------------------------------------------------------------------- Sector Breakdown:* [GRAPH] Corporate Bonds & Notes 83.1% Mortgage-Backed Securities 8.0% Asset-Backed Securities 6.1% Other 2.8% Quality Breakdown:* [GRAPH] AAA 1.2% AA 0.6% A 1.2% BBB 16.7% BB 42.5% B 37.8% *% of Total Investments as of March 31, 2001 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that Portfolio shares, when redeemed, may be worth more or less than their original cost. The Portfolio commenced operations on 12/08/2000. The total return performance since inception was 2.09%. The Portfolio may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. The investments made by the High Yield Portfolio may involve high risk and have speculative characteristics. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The High Yield Portfolio returned 0.20% for the quarter ended March 31, 2001 compared to 5.52% for the Lehman Brothers BB U.S. High Yield Index. . An overweight in telecoms was negative as this sector significantly underperformed the broader market. . A focus on conservative companies such as healthcare and utilities detracted from returns as the more aggressive sectors outperformed in the beginning of 2001. . Avoiding basic materials and retail issues helped relative performance as these sectors were adversely effected by excess capacity and a reduction in consumer and investment demand. 2001 Annual Report 5 PIMCO Mortgage Portfolio -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with prudent investment management Portfolio: Primarily mortgage-related fixed income securities Duration: 3.4 years Total Net Assets: $3.5 billion Sector Breakdown:* [GRAPH] Mortgage-Backed Securities 68.2% Asset-Backed Securities 18.8% U.S. Treasury Obligations 6.8% Other 6.2% Quality Breakdown:* [GRAPH] AAA 79.6% AA 6.4% A 7.1% BBB 6.9% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001 Salomon 3-Month Lehman Brothers Mortgage Portfolio Treasury Bill Mortgage (Incep. 1/31/2000) Index Index 1 Year 12.57% 6.02% 12.64% Since Inception* 13.74% -- -- * Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] MORTGAGE PORTFOLIO Salomon Mortgage 3-Month Treasury Lehman Brothers MONTH Portfolio Bill Index Mortgage Index -------------------------------------------------------------------------------- 01/31/2000 5,000,000 5,000,000 5,000,000 02/29/2000 5,085,000 5,021,499 5,057,965 03/31/2000 5,160,295 5,045,100 5,113,285 04/30/2000 5,155,266 5,068,812 5,116,793 05/31/2000 5,150,236 5,093,649 5,119,150 06/30/2000 5,251,091 5,117,588 5,228,582 07/31/2000 5,286,605 5,142,153 5,262,165 08/31/2000 5,357,635 5,167,606 5,341,925 09/30/2000 5,403,807 5,193,444 5,397,302 10/31/2000 5,439,832 5,220,658 5,436,060 11/30/2000 5,537,616 5,247,283 5,517,832 12/31/2000 5,658,808 5,275,094 5,606,677 01/31/2001 5,723,113 5,302,525 5,693,970 02/28/2001 5,771,341 5,325,326 5,726,575 03/31/2001 5,808,778 5,348,756 5,759,813 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that Portfolio shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 2/01/2000, the first full month following the Portfolio's inception date on 1/31/2000, compared to the Salomon 3-Month Treasury Bill Index and the Lehman Brothers Mortgage Index, each an unmanaged market index. -------------------------------------------------------------------------------- Portfolio insights -------------------------------------------------------------------------------- . The Mortgage Portfolio returned 12.57% for the year ended March 31, 2001, underperforming the 12.64% return of the Lehman Brothers Mortgage Index. . The Portfolio maintained a slightly higher duration than the Index, which added to returns as interest rates fell during the period. . Greater than Index exposure to GNMA securities hurt relative returns as market concerns that the federal government would restrict the activities of the Federal Home Loan Mortgage Corp. and the Federal National Mortgage Association dissipated causing these sectors of the market to perform well. . A dramatic shift in the shape of the yield curve favoring short to intermediate issues caused the long securities in the Portfolio to detract from performance. 6 PIMCO Funds PIMCO Asset-Backed Securities Portfolio -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with prudent investment management Portfolio: Primarily asset-backed securities Duration: 3.6 years Total Net Assets: $53.8 million -------------------------------------------------------------------------------- PORTFOLIO COMPOSITION -------------------------------------------------------------------------------- Sector Breakdown:* [GRAPH] Asset-Backed Securities 67.6% Mortgage-Backed Securities 31.3% Other 1.1% Quality Breakdown:* [GRAPH] AAA 57.4% AA 10.7% A 12.2% BBB 19.7% *% of Total Investments as of March 31, 2001 Past performance is no guarantee of future results. Investment return and principal value will fluctuate so that Portfolio shares, when redeemed, may be worth more or less than their original cost. The Portfolio commenced operations on 10/31/2000. The total return performance since inception was 7.58%. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The Asset-Backed Securities Portfolio commenced operations on October 31, 2000. . The Portfolio's investment objective is to maximize total return, consistent with prudent investment management, by investing primarily in asset-backed securities. . The Asset-Backed Securities Portfolio returned 2.90% during the first quarter of 2001, underperforming the 3.31% return of the Lehman Brothers Asset-Backed Securities Index. . The Portfolio maintained a slightly higher duration than the Index, which added to returns as interest rates fell during the period. . Exposure to pass-through securities hurt returns as an increase in mortgage prepayments hurt returns in this sector. 2001 Annual Report 7 PIMCO Real Return Bond Portfolio -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with prudent investment management Portfolio: Primarily inflation-indexed fixed income securities Duration: 2.3 years Total Net Assets: $208.8 million Sector Breakdown:* [GRAPH] U.S. Treasury Obligations 75.3% Corporate Bonds & Notes 14.4% Short-Term Instruments 7.2% Other 3.1% Quality Breakdown:* [GRAPH] AAA 84.8% AA 4.6% A 5.9% BBB 4.7% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001 Real Return Salomon 3-Month Lehman Brothers Bond Portfolio Treasury Bill Inflation Linked (Incep. 4/28/2000) Index Treasury Index -------------------------------------------------------------------------------- 6 Months 9.22% 2.99% 8.78% Since Inception 13.83% -- -- CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] REAL RETURN BOND PORTFOLIO Salomon Lehman Brothers Real Return 3-Month Treasury Inflation Linked MONTH Portfolio Bill Index Treasury Index -------------------------------------------------------------------------------- 04/30/2000 5,000,000 5,000,000 5,000,000 05/31/2000 4,990,000 5,024,500 4,986,999 06/30/2000 5,070,080 5,048,115 5,049,832 07/31/2000 5,110,239 5,072,346 5,092,997 08/31/2000 5,160,437 5,097,453 5,130,685 09/30/2000 5,210,932 5,122,941 5,157,363 10/31/2000 5,277,151 5,149,785 5,219,768 11/30/2000 5,358,651 5,176,049 5,295,456 12/31/2000 5,398,355 5,203,482 5,352,644 01/31/2001 5,524,020 5,230,541 5,464,518 02/28/2001 5,644,449 5,253,032 5,556,865 03/31/2001 5,691,545 5,276,144 5,610,213 Past performance is not an indication of future results. Investment return and principal value will fluctuate so that Portfolio shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 5/01/2000, the first full month following the Portfolio's inception on 4/28/2000, compared to the Salomon 3-Month Treasury Bill Index and the Lehman Brothers Inflation Linked Treasury Index, each an unmanaged market index. The Portfolio may invest in foreign securities which involve potentially higher risks including foreign currency fluctuations and political or economic uncertainty. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . From its inception on April 28, 2000 through March 31, 2001, the Real Return Bond Portfolio returned 13.83%, reflecting an average decline of 0.55% in real yields for Treasury Inflation Protection Securities (TIPS). . Over the Portfolio's operating history during fiscal 2001, TIPS outperformed the conventional, or non-inflation-adjusted, debt markets on a duration-equivalent basis. . The Portfolio is required to maintain 65% of its net assets in inflation-indexed securities: during its operating history, inflation-indexed bonds have contributed 90% or more of the Portfolio's duration. . An above-benchmark duration maintained by the Portfolio throughout its operating history improved returns as real yields dropped. . Overweighting intermediate TIPS boosted performance as intermediate real yields dropped more than longer-term real yields. . The Portfolio achieved greater inflation adjustments by overweighting intermediate TIPS maturities, which generate greater inflation capture than longer-term TIPS on a duration-equivalent basis. . The Portfolio's yield was improved by using a combination of TIPS buy-forward agreements and low-duration, high quality conventional yield debt instruments. . The Portfolio carefully managed its credit exposures by concentrating credit-sensitive holdings in high-quality corporate and asset-backed holdings and by limiting duration exposure contributed by credit-sensitive holdings. 8 PIMCO Funds PIMCO International Portfolio -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with prudent investment management Portfolio: Primarily non-U.S. fixed income securities Duration: 11.2 years Total Net Assets: $3.6 billion Country Allocation:* [GRAPH] United States 46.2% Germany 31.7% Short-Term Instruments 5.2% Other 16.9% Quality Breakdown:* [GRAPH] AAA 74.8% AA 11.2% A 9.7% BBB 4.3% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Salomon Salomon Bros. Lehman International 3-Month J.P. Morgan World Gov. Brothers Portfolio Treasury Bill Non-U.S. Index Bond Index Aggregate (Incep. 12/13/1989) Index (Hedged) (Currency Hedged) Bond Index 1 Year 10.89% 6.02% 10.36% 11.24% 12.53% 3 Years* 5.20% 5.29% 7.91% 8.31% 6.88% 5 Years* 8.50% 5.27% 9.92% 9.80% 7.48% 10 Years* 8.37% 4.84% 8.90% 9.18% 7.98% Since Inception* 8.29% -- -- -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] INTERNATIONAL BOND PORTFOLIO
Lehman Salomon Bros. Salomon Brothers World Gov. International 3-Month Treasury Aggregate J.P. Morgan Non-U.S. Bond Index MONTH Portfolio Bill Index Bond Index Index (Hedged) (Currency Hedged) ---------------------------------------------------------------------------------------------------------------------------------- 12/31/1989 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000 01/31/1990 4,944,945 5,033,000 4,940,584 4,894,002 4,901,150 02/28/1990 4,859,860 5,063,192 4,956,571 4,822,549 4,828,122 03/31/1990 4,924,925 5,097,117 4,960,222 4,826,888 4,825,757 04/30/1990 4,894,711 5,130,239 4,914,778 4,824,957 4,821,703 05/31/1990 4,980,318 5,165,123 5,060,297 4,945,583 4,941,474 06/30/1990 5,060,889 5,198,699 5,141,490 4,971,299 4,967,367 07/31/1990 5,189,338 5,233,007 5,212,613 4,995,162 4,986,841 08/31/1990 5,101,993 5,267,019 5,143,001 4,923,731 4,919,619 09/30/1990 5,096,855 5,299,147 5,185,549 4,900,097 4,892,214 10/31/1990 5,191,047 5,332,008 5,251,385 5,035,831 5,032,474 11/30/1990 5,295,705 5,363,473 5,364,426 5,113,886 5,114,856 12/31/1990 5,353,791 5,398,336 5,448,011 5,164,511 5,165,902 01/31/1991 5,461,621 5,429,107 5,515,358 5,262,640 5,264,004 02/28/1991 5,537,103 5,455,710 5,562,437 5,343,157 5,341,333 03/31/1991 5,493,971 5,484,079 5,600,705 5,351,704 5,344,163 04/30/1991 5,571,350 5,510,402 5,661,380 5,390,773 5,370,404 05/31/1991 5,598,986 5,536,853 5,694,486 5,432,283 5,402,195 06/30/1991 5,576,878 5,562,322 5,691,591 5,392,084 5,372,971 07/31/1991 5,627,372 5,589,022 5,770,519 5,422,820 5,421,916 08/31/1991 5,756,415 5,615,290 5,895,393 5,504,703 5,492,130 09/30/1991 5,868,626 5,639,998 6,014,854 5,585,071 5,581,764 10/31/1991 5,919,955 5,664,813 6,081,823 5,629,192 5,621,505 11/30/1991 5,937,064 5,687,473 6,137,588 5,634,259 5,639,437 12/31/1991 6,117,563 5,708,517 6,319,864 5,727,223 5,739,764 01/31/1992 6,123,555 5,728,497 6,233,887 5,781,061 5,787,804 02/29/1992 6,153,514 5,746,254 6,274,421 5,800,139 5,807,080 03/31/1992 6,096,592 5,765,791 6,239,048 5,758,379 5,774,154 04/30/1992 6,127,014 5,784,243 6,284,114 5,783,140 5,792,167 05/31/1992 6,212,196 5,803,330 6,402,694 5,836,343 5,854,548 06/30/1992 6,193,943 5,820,740 6,490,811 5,828,173 5,878,729 07/31/1992 6,193,943 5,838,203 6,623,238 5,809,522 5,919,996 08/31/1992 6,193,943 5,854,550 6,690,332 5,810,685 5,938,706 09/30/1992 6,298,508 5,869,185 6,769,637 5,890,873 6,036,160 10/31/1992 6,465,397 5,883,857 6,679,884 6,010,455 6,134,909 11/30/1992 6,465,397 5,898,566 6,681,395 6,001,441 6,126,997 12/31/1992 6,545,751 5,914,493 6,787,638 6,069,258 6,189,491 01/31/1993 6,570,432 5,930,462 6,917,800 6,124,490 6,250,890 02/28/1993 6,704,914 5,944,102 7,038,897 6,235,345 6,385,411 03/31/1993 6,743,338 5,958,963 7,068,228 6,239,086 6,365,170 04/30/1993 6,717,722 5,973,263 7,117,447 6,239,709 6,349,320 05/31/1993 6,763,200 5,988,197 7,126,511 6,274,653 6,361,067 06/30/1993 6,912,627 6,003,167 7,255,665 6,402,655 6,470,093 07/31/1993 6,997,086 6,018,776 7,296,702 6,474,365 6,542,559 08/31/1993 7,128,240 6,034,425 7,424,597 6,609,031 6,662,418 09/30/1993 7,141,356 6,049,511 7,444,990 6,637,449 6,720,049 10/31/1993 7,252,837 6,065,240 7,472,810 6,725,728 6,806,806 11/30/1993 7,292,542 6,080,402 7,409,240 6,772,807 6,890,597 12/31/1993 7,480,184 6,096,212 7,449,396 6,913,004 7,003,256 01/31/1994 7,466,522 6,112,061 7,549,975 6,878,440 6,924,050 02/28/1994 7,271,176 6,126,730 7,418,807 6,723,674 6,797,340 03/31/1994 7,184,356 6,143,884 7,235,901 6,662,489 6,746,973 04/30/1994 7,133,711 6,162,315 7,178,122 6,615,184 6,712,023 05/31/1994 6,943,674 6,182,650 7,177,115 6,541,754 6,672,357 06/30/1994 6,768,255 6,203,672 7,161,254 6,475,028 6,606,433 07/31/1994 6,804,801 6,226,004 7,303,499 6,517,762 6,670,382 08/31/1994 6,723,527 6,249,040 7,312,563 6,455,193 6,616,352 09/30/1994 6,686,585 6,272,161 7,204,935 6,461,002 6,626,675 10/31/1994 6,716,139 6,297,877 7,198,515 6,486,200 6,641,718 11/30/1994 6,775,247 6,324,328 7,182,528 6,577,654 6,733,703 12/31/1994 6,768,742 6,353,419 7,232,125 6,562,527 6,742,861 01/31/1995 6,845,010 6,382,645 7,375,252 6,634,060 6,814,943 02/28/1995 6,940,344 6,410,729 7,550,604 6,719,640 6,919,622 03/31/1995 7,092,879 6,442,142 7,596,928 6,856,718 7,113,649 04/30/1995 7,226,348 6,473,064 7,703,046 6,965,740 7,225,046 05/31/1995 7,283,548 6,504,783 8,001,133 7,194,219 7,464,774 06/30/1995 7,216,814 6,535,355 8,059,794 7,170,476 7,457,832 07/31/1995 7,359,816 6,566,724 8,041,793 7,260,826 7,530,545 08/31/1995 7,512,351 6,597,588 8,138,847 7,323,992 7,572,264 09/30/1995 7,579,085 6,627,277 8,218,026 7,439,711 7,709,248 10/31/1995 7,741,153 6,657,763 8,324,899 7,523,038 7,789,499 11/30/1995 8,028,929 6,687,056 8,449,648 7,687,792 7,953,859 12/31/1995 8,172,816 6,717,817 8,568,228 7,759,288 7,998,959 01/31/1996 8,323,303 6,748,047 8,625,126 7,853,176 8,066,389 02/29/1996 8,071,081 6,775,714 8,475,201 7,760,509 7,968,867 03/31/1996 8,162,452 6,804,172 8,416,289 7,824,921 8,061,304 04/30/1996 8,314,737 6,832,069 8,368,958 7,918,820 8,102,659 05/31/1996 8,294,432 6,861,446 8,351,964 7,972,668 8,166,185 06/30/1996 8,406,606 6,890,266 8,464,124 8,038,841 8,226,123 07/31/1996 8,518,966 6,919,893 8,487,286 8,099,132 8,291,523 08/31/1996 8,682,399 6,950,341 8,473,061 8,206,850 8,415,894 09/30/1996 8,938,478 6,980,228 8,620,720 8,381,658 8,563,256 10/31/1996 9,277,524 7,010,940 8,811,682 8,519,953 8,707,033 11/30/1996 9,585,748 7,040,387 8,962,613 8,690,353 8,853,051 12/31/1996 9,541,698 7,070,659 8,879,280 8,702,521 8,847,827 01/31/1997 9,589,950 7,101,064 8,906,470 8,811,304 8,964,175 02/28/1997 9,650,264 7,128,758 8,928,625 8,867,695 9,048,171 03/31/1997 9,456,645 7,160,124 8,829,683 8,820,698 9,022,564 04/30/1997 9,529,482 7,190,913 8,961,858 8,915,963 9,094,113 05/31/1997 9,711,574 7,222,552 9,046,576 8,962,325 9,124,215 06/30/1997 9,917,871 7,252,888 9,153,953 9,114,683 9,267,283 07/31/1997 10,149,939 7,284,075 9,400,806 9,259,609 9,419,453 08/31/1997 10,027,798 7,315,396 9,320,619 9,270,720 9,450,818 09/30/1997 10,224,042 7,346,122 9,458,082 9,434,811 9,590,974 10/31/1997 10,088,868 7,378,443 9,595,292 9,495,192 9,678,635 11/30/1997 10,150,311 7,409,434 9,639,476 9,563,560 9,725,963 12/31/1997 10,134,127 7,441,296 9,736,531 9,687,886 9,834,895 01/31/1998 10,367,431 7,474,038 9,861,531 9,816,715 9,949,568 02/28/1998 10,323,686 7,503,933 9,853,663 9,904,106 10,036,231 03/31/1998 10,542,817 7,536,951 9,887,966 9,992,250 10,126,154 04/30/1998 10,601,551 7,568,601 9,939,577 10,043,212 10,190,861 05/31/1998 10,807,121 7,601,151 10,033,862 10,180,804 10,339,853 06/30/1998 10,940,178 7,632,316 10,118,958 10,224,581 10,368,081 07/31/1998 10,940,178 7,664,371 10,140,483 10,319,668 10,458,180 08/31/1998 10,688,849 7,697,328 10,305,514 10,522,966 10,672,467 09/30/1998 10,956,920 7,728,887 10,546,828 10,772,362 10,936,503 10/31/1998 10,778,275 7,759,803 10,491,062 10,756,203 10,925,894 11/30/1998 10,867,598 7,788,514 10,550,604 10,872,370 11,007,730 12/31/1998 11,270,457 7,817,332 10,582,326 10,859,322 10,902,936 01/31/1999 11,396,384 7,846,256 10,657,855 10,993,977 11,032,464 02/28/1999 11,097,307 7,872,934 10,471,803 10,920,319 10,989,769 03/31/1999 11,144,530 7,902,850 10,529,834 11,050,270 11,138,129 04/30/1999 11,160,271 7,932,091 10,563,192 11,190,608 11,281,477 05/31/1999 10,939,899 7,962,233 10,470,670 11,144,727 11,265,119 06/30/1999 10,924,617 7,991,692 10,437,311 10,971,984 11,083,976 07/31/1999 10,908,762 8,022,861 10,392,875 10,943,457 11,092,288 08/31/1999 10,861,194 8,054,953 10,387,691 10,963,155 11,119,355 09/30/1999 10,988,621 8,086,366 10,508,182 11,004,817 11,187,738 10/31/1999 10,972,649 8,119,521 10,546,954 11,031,228 11,217,050 11/30/1999 10,924,733 8,151,998 10,546,198 11,095,206 11,274,033 12/31/1999 11,003,998 8,187,053 10,495,342 11,128,492 11,335,588 01/31/2000 10,938,693 8,223,076 10,460,977 11,129,607 11,349,079 02/29/2000 10,922,366 8,258,434 10,587,487 11,211,964 11,420,917 03/31/2000 11,069,547 8,297,248 10,726,964 11,375,657 11,565,507 04/30/2000 11,020,203 8,336,244 10,696,249 11,437,085 11,633,048 05/31/2000 11,135,340 8,377,092 10,691,339 11,528,579 11,738,908 06/30/2000 11,250,597 8,416,463 10,913,771 11,583,916 11,841,034 07/31/2000 11,300,305 8,456,863 11,012,840 11,667,320 11,941,686 08/31/2000 11,300,305 8,498,723 11,172,457 11,669,652 11,996,617 09/30/2000 11,383,888 8,541,217 11,242,699 11,770,012 12,067,397 10/31/2000 11,400,579 8,585,973 11,317,095 11,865,348 12,174,797 11/30/2000 11,617,574 8,629,761 11,502,140 12,075,364 12,385,909 12/31/2000 11,843,083 8,675,499 11,715,509 12,209,400 12,507,287 01/31/2001 12,033,264 8,720,613 11,907,100 12,354,192 12,654,874 02/28/2001 12,119,709 8,758,111 12,010,826 12,460,339 12,771,301 03/31/2001 12,274,582 8,796,646 12,071,123 12,554,379 12,865,807
Past performance is not an indication of future results. Investment return and principal value will fluctuate so that Portfolio shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 1/01/1990, the first full month following the Portfolio's inception date on 12/13/1989, compared to the Salomon 3-Month Treasury Bill Index, the Lehman Brothers Aggregate Bond Index, the J.P. Morgan Non-U.S. Index (Hedged) and the Salomon Brothers World Government Bond Index (Currency Hedged), each an unmanaged market index. Foreign investing involves potentially higher risks including currency fluctuations and political or economic uncertainty. We will no longer compare the Portfolio to the Salomon Brothers World Government Bond Index (Currency Hedged) and Lehman Brothers Aggregate Bond Indexes since these Indexes are not a comparable International Portfolio index. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . For the 12-month period ended March 31, 2001, the International Portfolio posted a return of 10.89%, outperforming the 6.02% return of the Salomon 3-Month Treasury Bill Index. . Extending the Portfolio's duration added to returns as yields fell worldwide amid a slowdown in global growth. A portion of the Portfolio's overweight duration was focused in core Europe and these bonds rallied as Europe felt the impact of the U.S.-led slowdown. . An underweight in Japan was negative. Japanese yields fell due to a weak economy, continued domestic support and a return to zero short-term rates. . Real return bonds added to relative returns, outperforming like-duration government bonds as real yields fell worldwide. . An overweight in the euro was negative. The euro fell despite improving growth relative to the U.S. Later in the year, concern that the ECB would keep short-term rates too high, limiting growth prospects, weighed heavily on the euro. . Emerging market holdings were slightly positive as we avoided problem credits such as Turkey and Argentina. . An underweight in Hong Kong versus the U.S. added to returns after heightened concerns about fixed currency regimes caused Hong Kong yields to rise. 2001 Annual Report 9 PIMCO Emerging Markets Portfolio -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with prudent investment management Portfolio: Primarily emerging market fixed income securities Duration: 4.6 years Total Net Assets: $287.9 million Country Allocation:* [GRAPH] Mexico 17.8% Brazil 12.0% Poland 11.6% South Korea 11.0% Bulgaria 9.0% Panama 6.8% Peru 5.4% Short-Term Instruments 3.9% Other 22.5% Quality Breakdown:* [GRAPH] AAA 2.8% AA 2.9% BBB 53.2% BB 37.5% B 3.6% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001
Emerging Salomon 3-Month J.P. Morgan Lehman Brothers Markets Port. Treasury Bill Emerging Markets Aggregate Bond (Incep. 4/03/1998) Index Index Plus Index 1 Year 10.31% 6.02% 9.65% 12.53% Since Inception* 8.89% -- -- --
* Annualized CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] EMERGING MARKETS PORTFOLIO
Salomon Lehman Brothers Emerging Markets 3-Month Treasury J.P. Morgan Emerging Aggregate Bond MONTH Portfolio Bill Index Markets Index Plus Index ------------------------------------------------------------------------------------------------- 04/30/1998 5,000,000 5,000,000 5,000,000 5,000,000 05/31/1998 4,944,400 5,021,503 4,829,347 5,047,429 06/30/1998 4,891,710 5,042,092 4,689,782 5,090,236 07/31/1998 5,001,037 5,063,268 4,722,141 5,101,064 08/31/1998 4,265,043 5,085,040 3,364,998 5,184,081 09/30/1998 4,536,231 5,105,889 3,694,095 5,305,471 10/31/1998 4,749,812 5,126,313 3,933,103 5,277,419 11/30/1998 5,137,475 5,145,280 4,164,761 5,307,371 12/31/1998 5,122,302 5,164,318 4,060,642 5,323,328 01/31/1999 5,110,595 5,183,426 3,909,994 5,361,322 02/28/1999 5,142,926 5,201,049 3,966,297 5,267,730 03/31/1999 5,296,664 5,220,813 4,266,545 5,296,922 04/30/1999 5,438,686 5,240,131 4,557,951 5,313,703 05/31/1999 5,274,822 5,260,043 4,298,148 5,267,161 06/30/1999 5,334,460 5,279,504 4,490,275 5,250,380 07/31/1999 5,345,462 5,300,095 4,397,324 5,228,027 08/31/1999 5,349,303 5,321,296 4,391,169 5,225,419 09/30/1999 5,457,620 5,342,048 4,544,422 5,286,031 10/31/1999 5,547,013 5,363,951 4,719,835 5,305,534 11/30/1999 5,655,067 5,385,406 4,853,406 5,305,155 12/31/1999 5,752,317 5,408,564 5,115,975 5,279,572 01/31/2000 5,696,409 5,432,362 5,014,681 5,262,285 02/29/2000 5,851,645 5,455,720 5,337,625 5,325,925 03/31/2000 5,876,326 5,481,362 5,505,758 5,396,087 04/30/2000 5,786,748 5,507,124 5,400,599 5,380,636 05/31/2000 5,655,366 5,534,108 5,262,883 5,378,166 06/30/2000 5,882,949 5,560,118 5,529,709 5,490,058 07/31/2000 6,004,247 5,586,807 5,696,708 5,539,894 08/31/2000 6,180,129 5,614,461 5,897,800 5,620,187 09/30/2000 6,069,929 5,642,534 5,817,591 5,655,522 10/31/2000 5,970,828 5,672,101 5,686,694 5,692,946 11/30/2000 6,032,766 5,701,028 5,657,693 5,786,031 12/31/2000 6,281,231 5,731,244 5,917,379 5,893,364 01/31/2001 6,430,168 5,761,047 6,219,564 5,989,742 02/28/2001 6,443,119 5,785,819 6,120,842 6,041,920 03/31/2001 6,482,300 5,811,276 6,037,058 6,072,252
Past performance is not an indication of future results. Investment return and principal value will fluctuate so that Portfolio shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 5/01/1998, the first full month following the Portfolio's inception date on 4/03/1998, compared to the Salomon 3-Month Treasury Bill Index, the J.P. Morgan Emerging Markets Index Plus and the Lehman Brothers Aggregate Bond Index, each an unmanaged market index. The Portfolio may invest in foreign securities which involve potentially higher risks including currency fluctuations and political or economic uncertainty. Investing in emerging market securities imposes even greater risks including smaller capitalization of securities markets, which can experience illiquidity, price volatility, foreign restrictions, and repatriation of investment income and capital. We will no longer compare the Portfolio to the Lehman Brothers Aggregate Bond Index since the Lehman Brothers Aggregate Bond Index is not a comparable Emerging Markets index. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The Emerging Markets Portfolio returned 10.31% for the 12-month period ended March 31, 2001, versus the 6.02% return of the Salomon 3-Month Treasury Bill Index and the 9.65% return of the benchmark J.P. Morgan Emerging Markets Index Plus. . The emerging markets sector returned 9.65% during the fiscal period and was among the best performing bond market sectors as economic and financial conditions improved in most countries. . Volatility increased during the period reflecting a difficult external environment and concerns over slowing growth worldwide. . Divergence in performance occurred between those countries with strong fundamentals vs. those contending with weak domestic growth and heavy reliance on external funding. . An underweight to Argentina added to relative performance as debt dynamics continued to deteriorate and economic growth remained weak. . Mexico turned in strong performance on favorable economic data and prospects for an impending rating upgrade; thus the Portfolio's overweight was positive. . In Brazil, our overweight was modestly negative as strong economic conditions were offset as concerns for the Argentine situation mounted. . An underweight to Poland detracted from returns as the country showed strong returns on solid economic growth and continued fiscal discipline. . In South Korea, a strong financial position and evidence of corporate and financial restructuring boosted debt prices; thus our underweight was negative. 10 PIMCO Funds PIMCO Municipal Sector Portfolio -------------------------------------------------------------------------------- FUND CHARACTERISTICS -------------------------------------------------------------------------------- Objective: Maximum total return, consistent with prudent investment management Portfolio: Primarily municipal securities Duration: 8.5 years Total Net Assets: $69.2 million Sector Breakdown:* [GRAPH] Municipal Bonds & Notes 95.3% Other 4.7% Quality Breakdown:* [GRAPH] AAA 81.6% AA 13.5% A 1.4% BBB 3.5% *% of Total Investments as of March 31, 2001 -------------------------------------------------------------------------------- PERFORMANCE -------------------------------------------------------------------------------- TOTAL RETURN INVESTMENT PERFORMANCE For the Period Ended March 31, 2001 Municipal Salomon 3-Month Lehman Brothers Sector Portfolio Treasury Bill General Municipal (Incep. 8/21/2000) Index Bond Index -------------------------------------------------------------------------------- 6 Months 10.73% 2.99% 6.70% Since Inception 9.95% -- -- CUMULATIVE RETURNS THROUGH MARCH 31, 2001 $5,000,000 invested at inception [GRAPH] MUNICIPAL SECTOR PORTFOLIO Lehman Brothers Municipal Sector Salomon 3-Month General Municipal MONTH Portfolio Treasury Bill Index Bond Index -------------------------------------------------------------------------------- 08/31/2000 5,000,000 5,000,000 5,000,000 09/30/2000 4,959,960 5,025,000 4,974,002 10/31/2000 5,015,015 5,051,331 5,028,218 11/30/2000 5,075,075 5,077,093 5,066,432 12/31/2000 5,324,825 5,104,002 5,191,571 01/31/2001 5,365,356 5,130,543 5,242,970 02/28/2001 5,400,821 5,152,604 5,259,747 03/31/2001 5,491,989 5,175,275 5,307,084 Past performance is not an indication of future results. Investment return and principal value will fluctuate so that Portfolio shares, when redeemed, may be worth more or less than their original cost. The line graph above assumes the investment of $5,000,000 on 9/01/2000, the first full month following the Portfolio's inception date on 8/21/2000, compared to the Salomon 3-Month Treasury Bill Index and the Lehman Brothers General Municipal Bond Index, each an unmanaged market index. -------------------------------------------------------------------------------- PORTFOLIO INSIGHTS -------------------------------------------------------------------------------- . The Municipal Sector Portfolio invests at least 65% of its assets in municipal bonds with no below-investment-grade holdings permitted. . The Portfolio returned 9.95% since its inception on August 21, 2000 through March 31, 2001. . The municipal market rallied over the operating history of the Portfolio with municipal rates falling by 0.90% to 1.00% in the shorter maturity range and 0.40% to 0.50% in the long maturity range. . The Portfolio benefited from using higher duration as municipal interest rates dropped during the fiscal year ended March 31, 2001. . The Portfolio improved its returns by taking advantage of the yield curve steepening, accruing yields and total returns above the cost of short-term financing. . Management enhanced performance by substituting municipal duration exposure for Treasury duration exposure at opportune times throughout the operating period. . The Portfolio emphasized a high average AAA or AA+ credit quality throughout its operating history. . The Portfolio was structured at March 31 to provide: high coupon income from call-protected bonds; potential price appreciation from additional Fed easing; and additional portfolio yield from using low short-term financing rates. 2001 Annual Report 11
Financial Highlights Net Asset Net Realized/ Total Dividends Value Unrealized Income from from Net Beginning Net Investment Gain (Loss) on Investment Investment Selected Per Share Data of Period Income (Loss) Investments Operations Income for the Year or Period Ended: Short-Term Portfolio 04/20/2000 - 03/31/2001 $ 10.00 $ 0.65 (a) $ 0.10 (a) $ 0.75 $ (0.57) U.S. Government Sector Portfolio 03/31/2001 $ 10.62 $ 0.69 (a) $ 0.96 (a) $ 1.65 $ (0.54) 01/31/2000 - 03/31/2000 10.00 0.12 (a) 0.54 (a) 0.66 (0.04) Investment Grade Corporate Portfolio 03/31/2001 $ 10.13 $ 0.78 (a) $ 0.36 (a) $ 1.14 $ (0.68) 01/26/2000 - 03/31/2000 10.00 0.14 (a) 0.07 (a) 0.21 (0.08) High Yield Portfolio 12/08/2000 - 03/31/2001 $ 9.57 $ 0.30 (a) $ (0.10)(a) $ 0.20 $ (0.21) Mortgage Portfolio 03/31/2001 $ 10.26 $ 0.82 (a) $ 0.43 (a) $ 1.25 $ (0.64) 01/31/2000 - 03/31/2000 10.00 0.12 (a) 0.20 (a) 0.32 (0.06) Asset-Backed Securities Portfolio 10/31/2000 - 03/31/2001 $ 10.00 $ 0.32 (a) $ 0.43 (a) $ 0.75 $ (0.19) Real Return Bond Portfolio 04/28/2000 - 03/31/2001 $ 10.00 $ 0.69 (a) $ 0.66 (a) $ 1.35 $ (0.48) International Portfolio 03/31/2001 $ 6.73 $ 0.42 (a) $ 0.29 (a) $ 0.71 $ (0.32) 03/31/2000 7.08 0.39 (a) (0.44)(a) (0.05) (0.30) 03/31/1999 7.18 0.29 (a) 0.11 (a) 0.40 (0.30) 03/31/1998 7.79 0.64 (a) 0.19 (a) 0.83 (0.25) 03/31/1997 8.04 0.84 0.42 1.26 (0.50) Emerging Markets Portfolio 03/31/2001 $ 9.84 $ 0.49 (a) $ 0.47 (a) $ 0.96 $ (0.84) 03/31/2000 9.63 0.80 (a) 0.21 (a) 1.01 (0.80) 04/03/1998 - 03/31/1999 10.00 0.87 (a) (0.39)(a) 0.48 (0.85) Municipal Sector Portfolio 08/21/2000 - 03/31/2001 $ 10.00 $ 0.26 (a) $ 0.73 (a) $ 0.99 $ (0.17)
+ Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) Ratio of expenses to average net assets excluding interest expense is 0.05%. (c) Ratio of expenses to average net assets excluding interest expense is 0.12%. (d) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 0.07%. (e) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 0.10%. (f) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 0.09%. (g) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 1.59%. (h) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 0.06%. (i) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 0.08%. (j) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 0.11%. 12 PIMCO Funds See accompanying notes
Dividends in Distributions Distributions Ratio of Excess of Net from Net in Excess of Net Net Asset Expenses to Investment Realized Realized Capital Total Value End Net Assets End Average Net Income Capital Gains Gains Distributions of Period Total Return of Period (000s) Assets $ 0.00 $ (0.01) $ 0.00 $ (0.58) $ 10.17 7.62% $ 191,299 1.58%+(b)(g) $ 0.00 $ (0.38) $ 0.00 $ (0.92) $ 11.35 16.03% $1,257,236 0.11%(b) 0.00 0.00 0.00 (0.04) 10.62 6.61 311,652 0.05+(f) $ 0.00 $ (0.01) $ 0.00 $ (0.69) $ 10.58 11.59% $ 999,641 0.11%(b) 0.00 0.00 0.00 (0.08) 10.13 2.11 316,279 0.05+(e) $ 0.00 $ 0.00 $ 0.00 $ (0.21) $ 9.56 2.09% $ 212,247 0.05%+(h) $ 0.00 $ (0.08) $ 0.00 $ (0.72) $ 10.79 12.57% $3,477,278 0.87%(b) 0.00 0.00 0.00 (0.06) 10.26 3.21 985,563 0.05+(d) $ 0.00 $ 0.00 $ 0.00 $ (0.19) $ 10.56 7.58% $ 53,822 0.05%+(i) $ 0.00 $ (0.03) $ 0.00 $ (0.51) $ 10.84 13.83% $ 208,832 0.09%+(j) $ 0.00 $ (0.07) $ 0.00 $ (0.39) $ 7.05 10.89% $3,588,537 0.13%(c) 0.00 0.00 0.00 (0.30) 6.73 (0.67) 1,142,215 0.50 0.00 0.00 (0.20) (0.50) 7.08 5.71 720,025 0.50 0.00 (0.24) (0.95) (1.44) 7.18 11.49 730,622 0.51 0.00 (1.01) 0.00 (1.51) 7.79 15.86 957,950 0.50 $ 0.00 $ 0.00 $ (0.05) $ (0.89) $ 9.91 10.31% $ 287,880 0.16%(c) 0.00 0.00 0.00 (0.80) 9.84 10.94 354,371 0.85 0.00 0.00 0.00 (0.85) 9.63 5.49 145,530 0.85+ $ 0.00 $ 0.00 $ 0.00 $ (0.17) $ 10.82 9.95% $ 69,211 0.05%+(i)
Ratio of Net Investment Income (Loss) to Average Net Portfolio Turnover Assets Rate 6.84%+ 154% 6.24% 1200% 6.86+ 283 7.54% 240% 7.65+ 65 9.79%+ 80% 7.80% 742% 7.13+ 156 7.38%+ 134% 7.21%+ 260% 6.05% 464% 5.61 369 4.04 406 8.17 255 7.17 875 9.15% 224% 8.20 159 9.43+ 199 4.00%+ 189% 2001 Annual Report See accompanying notes 13 Statements of Assets and Liabilities March 31, 2001
Short-Term U.S. Government Investment Grade Amounts in thousands, except per share amounts Portfolio Sector Portfolio Corporate Portfolio Assets: Investments, at value $ 308,911 $ 2,315,230 $ 1,096,843 Cash and foreign currency 793 9,452 16,834 Receivable for investments sold and forward foreign currency contracts 34,058 594,874 23,594 Receivable for Portfolio shares sold 0 0 55,700 Interest and dividends receivable 2,442 20,903 18,444 Variation margin receivable 0 1,218 63 Manager reimbursement receivable 16 0 0 Other assets 7 16 16 346,227 2,941,693 1,211,494 -------------------------------------------------------------------------- ----------- ----------- ----------- Liabilities: Payable for investments purchased and forward foreign currency contracts $ 24,359 $ 613,313 $ 211,086 Payable for financing transactions 34,301 963,182 0 Payable for short sales 0 0 0 Due to Custodian 0 0 0 Notes payable 95,703 0 0 Written options outstanding 0 1,484 0 Payable for Portfolio shares redeemed 0 101,114 0 Accrued investment advisory fee 5 23 13 Accrued administration fee 7 34 19 Variation margin payable 0 1,211 0 Other liabilities 553 4,096 735 154,928 1,684,457 211,853 -------------------------------------------------------------------------- ----------- ----------- ----------- Net Assets $ 191,299 $ 1,257,236 $ 999,641 -------------------------------------------------------------------------- ----------- ----------- ----------- Net Assets Consist of: Paid in capital $ 187,984 $ 1,196,441 $ 978,667 Undistributed net investment income 2,894 47,018 7,218 Accumulated undistributed net realized gain (loss) (58) (3,397) (478) Net unrealized appreciation (depreciation) 479 17,174 14,234 $ 191,299 $ 1,257,236 $ 999,641 -------------------------------------------------------------------------- ----------- ----------- ----------- Shares Issued and Outstanding: 18,806 110,786 94,473 Net Asset Value and Redemption Price Per Share (Net Assets Per Share Outstanding) $ 10.17 $ 11.35 $ 10.58 Cost of Investments Owned $ 307,638 $ 2,294,148 $ 1,081,694 -------------------------------------------------------------------------- ----------- ----------- ----------- Cost of Foreign Currency Held $ 0 $ 0 $ 0 -------------------------------------------------------------------------- ----------- ----------- -----------
14 PIMCO Funds See accompanying notes
Asset-Backed High Yield Mortgage Securities Real Return International Emerging Markets Municipal Sector Portfolio Portfolio Portfolio Bond Portfolio Portfolio Portfolio Portfolio $ 208,100 $ 7,001,384 $ 70,254 $ 353,856 $ 5,386,312 $ 298,150 $ 72,312 9 12,690 1 1,999 163,905 0 248 7,519 2,005,038 18,320 5,206 3,267,203 34,574 501 0 0 0 0 30,000 0 0 5,018 46,292 316 3,086 108,237 6,068 866 0 0 0 28 0 0 0 16 0 6 16 0 0 9 1 402 0 143 10,511 4 14 220,663 9,065,806 88,897 364,334 8,966,168 338,796 73,950 ----------- ----------- ----------- ----------- ----------- ----------- ----------- $ 7,026 $ 4,222,315 $ 35,073 $ 8,772 $ 377,743 $ 10,872 $ 4,680 0 511,976 0 146,715 3,807,741 18,697 0 0 0 0 0 1,181,414 20,469 0 0 0 0 0 0 818 0 0 760,028 0 0 0 0 0 0 0 0 0 1,721 0 0 1,373 87,300 0 0 8,000 0 0 7 63 1 3 61 5 1 10 95 1 5 306 25 2 0 37 0 7 430 0 56 0 6,714 0 0 215 30 0 8,416 5,588,528 35,075 155,502 5,377,631 50,916 4,739 ----------- ----------- ----------- ----------- ----------- ----------- ----------- $ 212,247 $ 3,477,278 $ 53,822 $ 208,832 $ 3,588,537 $ 287,880 $ 69,211 ----------- ----------- ----------- ----------- ----------- ----------- ----------- $ 199,532 $ 3,308,417 $ 51,560 $ 198,473 $ 3,531,682 $ 286,625 $ 63,937 16,403 42,694 797 2,772 25,563 1,452 3,177 (16) (10,689) 0 (27) (1,204) (6,388) (247) (3,672) 136,856 1,465 7,614 32,496 6,191 2,344 $ 212,247 $ 3,477,278 $ 53,822 $ 208,832 $ 3,588,537 $ 287,880 $ 69,211 ----------- ----------- ----------- ----------- ----------- ----------- ----------- 22,194 322,224 5,097 19,264 508,904 29,034 6,390 $ 9.56 $ 10.79 $ 10.56 $ 10.84 $ 7.05 $ 9.91 $ 10.82 $ 211,779 $ 6,862,875 $ 68,789 $ 346,232 $ 5,501,595 $ 293,008 $ 70,216 ----------- ----------- ----------- ----------- ----------- ----------- ----------- $ 2,606 $ 0 $ 0 $ 7 $ 162,028 $ 3,178 $ 0 ----------- ----------- ----------- ----------- ----------- ----------- -----------
2001 Annual Report See accompanying notes 15 Statements of Operations For the period ended March 31, 2001
Short-Term U.S. Government Investment Grade Amounts in thousands, except per share amounts Portfolio Sector Portfolio Corporate Portfolio Investment Income: Interest $ 10,469 $ 48,077 $ 34,398 Dividends, net of foreign taxes 0 0 0 Miscellaneous Income 0 0 0 Total Income 10,469 48,077 34,398 Expenses: Investment advisory fees 25 152 89 Administration fees 37 228 134 Trustees' fees 0 0 0 Organization costs 17 0 0 Interest expense 1,903 435 290 Recoupment by Manager 0 4 2 Total expenses 1,982 819 515 Reimbursement by Manager (16) 0 0 Net expenses 1,966 819 515 Net Investment Income 8,503 47,258 33,883 --------------------------------------------------------------------------- -------- -------- -------- Net Realized and Unrealized Gain (Loss): Net realized gain (loss) on investments 757 51,065 3,535 Net realized gain (loss) on futures contracts and written options (141) 8,592 (128) Net realized gain (loss) on foreign currency transactions 0 0 0 Net change in unrealized appreciation (depreciation) on investments 479 9,722 12,977 Net change in unrealized appreciation (depreciation) on futures contracts and written options 0 341 (290) Net change in unrealized appreciation (depreciation) on translation of assets and liabilities denominated in foreign currencies 0 0 0 Net Gain (Loss) 1,095 69,720 16,094 Net Increase in Assets Resulting from Operations $ 9,598 $116,978 $ 49,977 --------------------------------------------------------------------------- -------- -------- --------
16 PIMCO Funds See accompanying notes
Asset-Backed High Yield Mortgage Securities Real Return International Emerging Markets Municipal Sector Portfolio Portfolio Portfolio Bond Portfolio Portfolio Portfolio Portfolio $ 16,025 $ 260,548 $ 1,351 $ 8,293 $ 122,440 $ 35,435 $ 1,254 207 0 0 0 0 2 0 11 0 2 0 38 0 3 16,243 260,548 1,353 8,293 122,478 35,437 1,257 32 600 4 22 395 76 6 49 899 5 34 1,975 380 9 0 0 0 0 5 1 0 17 0 6 17 0 0 9 0 24,633 0 49 232 131 0 0 15 0 0 0 0 0 98 26,147 15 122 2,607 588 24 (16) 0 (6) (16) 0 0 (9) 82 26,147 9 106 2,607 588 15 16,161 234,401 1,344 8,187 119,871 34,849 1,242 --------- --------- --------- --------- --------- -------- --------- 8,577 65,090 308 1,356 25,330 (6,215) 2,897 0 (28,768) 0 22 57,698 0 (247) (4) 0 0 0 (19,977) (1,687) 0 (3,679) 126,292 1,465 7,634 (66,127) 3,725 2,096 0 173 0 (10) 1,306 0 248 7 0 0 (10) 127,546 750 0 4,901 162,787 1,773 8,992 125,776 (3,427) 4,994 $ 21,062 $ 397,188 $ 3,117 $ 17,179 $ 245,647 $ 31,422 $ 6,236 --------- --------- --------- --------- --------- -------- ---------
2001 Annual Report See accompanying notes 17 Statements of Changes in Net Assets March 31, 2001
Short-Term U.S. Government Amounts in thousands Portfolio Sector Portfolio ----------------- ---------------------------------- Period From Year Ended Period From April 20, 2000 March 31, 2001 January 31, 2000 Increase (Decrease) in Net Assets from: to March 31, 2001 to March 31, 2000 Operations: Net investment income $ 8,503 $ 47,258 $ 2,590 Net realized gain (loss) 616 59,657 6,051 Net change in unrealized appreciation (depreciation) 479 10,063 7,111 Net increase (decrease) resulting from operations 9,598 116,978 15,752 Distributions to Shareholders: From net investment income (6,221) (40,849) (1,221) In excess of net investment income 0 0 0 From net realized capital gains (62) (29,865) 0 In excess of net realized capital gains 0 0 0 Total Distributions (6,283) (70,714) (1,221) ---------------------------------------------------------------------- ----------------- ---------------------------------- Portfolio Share Transactions: Receipts for shares sold 320,600 1,559,920 319,000 Issued as reinvestment of distributions 6,284 68,870 1,221 Cost of shares redeemed (138,900) (729,470) (23,100) Net increase resulting from Portfolio share transactions 187,984 899,320 297,121 Total Increase in Net Assets 191,299 945,584 311,652 ---------------------------------------------------------------------- ----------------- ---------------------------------- Net Assets: Beginning of period 0 311,652 0 End of period * $ 191,299 $ 1,257,236 $ 311,652 *Including net undistributed (overdistributed) investment income of: $ 2,894 $ 47,018 $ 4,152
Investment Grade Amounts in thousands Corporate Portfolio -------------------------------------- Year Ended Period From March 31, 2001 January 26, 2000 Increase (Decrease) in Net Assets from: to March 31, 2000 Operations: Net investment income $ 33,883 $ 2,702 Net realized gain (loss) 3,407 254 Net change in unrealized appreciation (depreciation) 12,687 1,547 Net increase (decrease) resulting from operations 49,977 4,503 Distributions to Shareholders: From net investment income (31,784) (1,468) In excess of net investment income 0 0 From net realized capital gains (254) 0 In excess of net realized capital gains 0 0 Total Distributions (32,038) (1,468) --------------------------------------------------------------------------- -------------------------------------- Portfolio Share Transactions: Receipts for shares sold 1,055,526 362,126 Issued as reinvestment of distributions 29,275 1,468 Cost of shares redeemed (419,378) (50,350) Net increase resulting from Portfolio share transactions 665,423 313,244 Total Increase in Net Assets 683,362 316,279 --------------------------------------------------------------------------- -------------------------------------- Net Assets: Beginning of period 316,279 0 End of period * $ 999,641 $ 316,279 *Including net undistributed (overdistributed) investment income of: $ 7,218 $ 1,488
18 PIMCO Funds See accompanying notes
Asset- Backed Real Return High Yield Securities Bond Portfolio Mortgage Portfolio Portfolio Portfolio ----------------- ---------------------------------- ----------------- ------------------ Period From Year Ended Period From Period From Period from December 8, 2000 March 31, 2001 January 31, 2000 October 31, 2000 April 28, 2000 to March 31, 2001 to March 31, 2000 to March 31, 2001 to March 31, 2001 $ 16,161 $ 234,401 $ 5,716 $ 1,344 $ 8,187 8,573 36,322 1,927 308 1,378 (3,672) 126,465 10,391 1,465 7,614 21,062 397,188 18,034 3,117 17,179 (8,347) (214,882) (3,140) (855) (6,438) 0 0 0 0 0 0 (28,339) 0 0 (382) 0 0 0 0 0 (8,347) (243,221) (3,140) (855) (6,820) ----------------- ---------------------------------- ----------------- ------------------ 661,618 4,292,103 967,529 55,556 231,658 9,423 224,172 3,140 855 5,240 (471,509) (2,178,527) 0 (4,851) (38,425) 199,532 2,337,748 970,669 51,560 198,473 212,247 2,491,715 985,563 53,822 208,832 ----------------- ---------------------------------- ----------------- ------------------ 0 985,563 0 0 0 $ 212,247 $ 3,477,278 $ 985,563 $ 53,822 $ 208,832 $ 16,403 $ 42,694 $ 4,320 $ 797 $ 2,772
Municipal Sector International Portfolio Emerging Markets Portfolio Portfolio ------------------------------------------- ---------------------------------- ----------------- Year Ended Year Ended Year Ended Year Ended Period from March 31, 2001 March 31, 2000 March 31, 2001 March 31, 2000 August 21, 2000 to March 31, 2001 $ 119,871 $ 51,425 $ 34,849 $ 20,454 $ 1,242 63,051 (33,794) (7,902) 8,157 2,650 62,725 (22,139) 4,475 (1,382) 2,344 245,647 (4,508) 31,422 27,229 6,236 (105,960) (43,147) (31,716) (20,428) (962) 0 0 0 (22) 0 (19,906) 0 0 0 0 (5,388) 0 (1,530) 0 0 (131,254) (43,147) (33,246) (20,450) (962) ------------------------------------------- ---------------------------------- ----------------- 3,048,940 679,200 329,447 226,178 67,208 124,599 41,675 31,541 19,552 755 (841,610) (251,030) (425,655) (43,668) (4,026) 2,331,929 469,845 (64,667) 202,062 63,937 2,446,322 422,190 (66,491) 208,841 69,211 ------------------------------------------- ---------------------------------- ----------------- 1,142,215 720,025 354,371 145,530 0 $ 3,588,537 $ 1,142,215 $ 287,880 $ 354,371 $ 69,211 $ 25,563 $ 15,837 $ 1,452 $ 1,534 $ 3,177
2001 Annual Report See accompanying notes 19 Statements of Cash Flows For the period ended March 31, 2001
Short-Term U.S. Government Real Return International Amounts in thousands Portfolio Sector Portfolio Bond Portfolio Portfolio Increase (Decrease) in Cash and Foreign Currency from: Financing Activities Sales of Portfolio shares $ 320,600 $ 1,559,919 $ 231,658 $ 3,024,140 Redemptions of Portfolio shares (138,900) (635,256) (38,425) (834,610) Cash distributions paid 0 (1,845) (1,581) (6,657) Increase from financing transactions 130,003 611,430 146,715 3,527,831 Net increase from financing activities 311,703 1,534,248 338,367 5,710,704 Operating Activities Purchases of long-term securities and foreign currency (548,493) (14,182,049) (888,057) (17,204,942) Proceeds from sales of long-term securities and foreign currency 239,251 12,805,147 577,509 11,878,956 Purchases of short-term securities (net) (7,393) 21,779 (23,604) (139,386) Net investment income 8,503 47,258 8,187 119,871 Change in other receivables/payables (net) (2,778) (216,931) (10,403) (229,921) Net (decrease) from operating activities (310,910) (1,524,796) (336,368) (5,575,422) ---------------------------------------------------------------- ------------ ------------ ------------ ------------ Net Increase in Cash and Foreign Currency 793 9,452 1,999 135,282 ---------------------------------------------------------------- ------------ ------------ ------------ ------------ Cash and Foreign Currency Beginning of period 0 0 0 28,623 End of period $ 793 $ 9,452 $ 1,999 $ 163,905
20 PIMCO Funds Schedule of Investments Short-Term Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 53.2% -------------------------------------------------------------------------------- Banking & Finance 24.6% AT&T Capital Corp. 7.000% due 08/15/2001 $ 2,000 $ 2,011 Chrysler Financial Corp. LLC 5.690% due 11/15/2001 1,800 1,805 5.400% due 01/15/2002 2,000 2,002 CIT Group, Inc. 6.730% due 09/13/2002 (d) 2,100 2,094 Deutsche Telekom International Finance 7.750% due 06/15/2005 5,000 5,166 Export-Import Bank Korea 7.125% due 09/20/2001 1,000 1,003 6.500% due 02/10/2002 1,000 1,006 Ford Motor Credit Co. 6.850% due 08/27/2001 (d) 2,400 2,400 General Electric Capital Corp. 6.750% due 09/11/2003 2,000 2,079 General Motors Acceptance Corp. 7.052% due 04/05/2004 (d) 1,000 986 Heller Financial, Inc. 5.116% due 06/25/2001 (d) 1,000 1,000 6.500% due 11/01/2001 1,000 1,008 6.500% due 07/22/2002 1,000 1,015 Industrial Bank of Korea 7.100% due 10/15/2001 1,500 1,511 Korea Development Bank 7.125% due 09/17/2001 3,400 3,422 MBNA Corp. 6.980% due 09/13/2001 (d) 1,515 1,517 Nacional Financiera 7.975% due 05/08/2003 (d) 2,500 2,556 National Consumer Coop Bank 7.513% due 10/26/2001 (d) 4,900 4,905 National Rural Utilities Cooperative Finance Corp. 5.337% due 08/13/2002 (d) 5,000 5,001 Paine Webber 6.585% due 07/23/2001 400 402 PS Colorado Credit Corp. 7.330% due 05/30/2002 (d) 1,900 1,898 Qwest Capital Funding, Inc. 6.875% due 08/15/2001 2,400 2,414 ---------- 47,201 ---------- Industrials 14.4% Clear Channel Communications, Inc. 7.210% due 06/15/2002 (d) 4,000 4,011 DaimlerChrysler North America Holding Corp. 6.590% due 06/18/2002 4,000 4,077 7.020% due 08/23/2002 (d) 1,200 1,190 5.153% due 09/16/2002 (d) 1,900 1,879 Enron Corp. 5.510% due 09/10/2001 (d) 1,000 1,001 Norfolk Southern Corp. 6.875% due 05/01/2001 900 901 Petroleos Mexicanos 8.075% due 07/15/2005 (d) 3,000 3,008 Safeway, Inc. 7.000% due 09/15/2002 4,500 4,583 Staples, Inc. 7.670% due 11/26/2001 (d) 2,000 2,002 Temple-Inland, Inc. 9.000% due 05/01/2001 400 401 Tyco International Group SA 6.125% due 06/15/2001 4,000 4,003 Viacom, Inc. 8.875% due 06/01/2001 465 467 ---------- 27,523 ---------- Utilities 14.2% Allete 7.610% due 10/20/2003 (d) 2,000 2,002 Appalachian Power Co. 7.160% due 06/27/2001 (d) 5,000 5,002 Carolina Power & Light Energy, Inc. 7.232% due 07/29/2002 (d) 4,900 4,911 Commonwealth Edison Co. 6.901% due 09/30/2002 (d) 2,000 2,001 Indiana Michigan Power Co. 7.305% due 09/03/2002 (d) 3,900 3,903 Pacific Gas & Electric Co. 7.057% due 10/31/2001 (d)(g) 1,500 1,238 Scana Corp. 7.393% due 07/15/2002 (d) 4,900 4,909 Southern California Edison Co. 7.203% due 05/01/2002 (d) 1,900 1,549 Texas Utilities Electric Co. 5.650% due 12/20/2002 (d) 1,050 1,050 WorldCom, Inc. 7.375% due 01/15/2003 500 506 ---------- 27,071 ---------- Total Corporate Bonds & Notes 101,795 (Cost $101,917) ---------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 7.4% -------------------------------------------------------------------------------- Federal Home Loan Bank 6.375% due 11/15/2002 13,800 14,180 ---------- Total U.S. Government Agencies 14,180 (Cost $13,787) ---------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 7.6% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (e) 3.625% due 07/15/2002 109 111 3.625% due 01/15/2008 4,335 4,437 U.S. Treasury Notes 6.375% due 01/31/2002 10,000 10,025 ---------- Total U.S. Treasury Obligations 14,573 (Cost $14,523) ---------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 77.6% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 23.1% Bear Stearns Adjustable Rate Mortgage Trust 7.496% due 11/25/2030 (d) 4,754 4,775 Chase Mortgage Finance Corp. 6.500% due 06/25/2028 2,322 2,338 6.550% due 08/25/2028 567 573 Fannie Mae 6.500% due 07/25/2006 15,986 16,023 6.150% due 10/25/2007 28 28 6.500% due 10/25/2007 173 174 5.262% due 06/25/2008 (d) 139 139 6.500% due 03/25/2019 611 615 6.750% due 03/25/2019 489 488 6.000% due 06/25/2019 736 737 7.000% due 12/25/2019 3,441 3,462 7.150% due 08/25/2020 22 22 7.000% due 01/18/2023 4,421 4,428 7.250% due 04/18/2024 27 27 Freddie Mac 8.000% due 04/15/2003 2 2 6.000% due 07/15/2006 3,009 3,013 7.250% due 06/15/2007 1,091 1,102 6.500% due 04/15/2009 1,682 1,690 6.000% due 12/15/2017 599 601 6.250% due 05/15/2019 866 871 7.250% due 09/15/2023 990 990 PNC Mortgage Securities Corp. 7.070% due 12/25/2030 (d) 1,746 1,750 Residential Asset Securitization Trust 7.250% due 12/25/2027 275 275 ---------- 44,123 ---------- Fannie Mae 0.0% 6.000% due 08/01/2001 19 19 7.000% due 05/01/2001 57 58 ---------- 77 ---------- 2001 Annual Report See accompanying notes 21 Schedule of Investments Short-Term Portfolio March 31, 2001 Principal Amount Value (000s) (000s) Government National Mortgage Association 54.5% 6.500% due 10/20/2029 (d) $ 97,322 $ 98,700 7.000% due 10/20/2029-02/20/2030 (d)(f) 5,561 5,600 ---------- 104,300 ---------- Total Mortgage-Backed Securities 148,500 (Cost $147,874) ---------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 10.7% -------------------------------------------------------------------------------- Arcadia Automobile Receivables Trust 6.000% due 11/17/2003 1,488 1,500 Capital Asset Research Funding LP 6.400% due 12/15/2004 4,190 4,195 CS First Boston Mortgage Securities Corp. 5.423% due 12/15/2030 (d) 6,724 6,730 First Security Auto Owner Trust 5.580% due 06/15/2003 622 624 GMAC Mortgage Corp. Loan Trust 5.780% due 11/18/2015 (d) 448 449 Premier Auto Trust 6.320% due 03/06/2002 90 90 5.690% due 11/08/2002 4,140 4,149 SallieMae 6.041% due 04/25/2007 (d) 2,609 2,610 ---------- Total Asset-Backed Securities 20,347 (Cost $20,286) ---------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 1.1% -------------------------------------------------------------------------------- Industrial 1.1% Nabors Industries, Inc. 0.000% due 06/20/2020 3,000 2,123 ---------- Total Convertible Bonds & Notes 2,123 (Cost $1,858) ---------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 3.9% -------------------------------------------------------------------------------- Commercial Paper 3.8% General Electric Capital Corp. 4.980% due 04/25/2001 2,200 2,193 UBS Finance, Inc. 5.400% due 04/02/2001 5,000 5,000 ---------- 7,193 ---------- Repurchase Agreement 0.1% State Street Bank 4.600% due 04/02/2001 200 200 (Dated 03/30/2001. Collateralized by Fannie Mae 0.000% due 06/21/2001 valued at $208. Repurchase proceeds are $200.) ---------- Total Short-Term Instruments 7,393 (Cost $7,393) ---------- Total Investments (a) 161.5% $ 308,911 (Cost $307,638) Other Assets and Liabilities (Net) (61.5%) (117,612) ---------- Net Assets 100.0% $ 191,299 ---------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $307,638 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 1,961 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (688) ---------- Unrealized appreciation-net $ 1,273 ---------- (b) Reverse repurchase agreements were entered into March 26, 2001 paying interest at 4.880%. The following security was segregated with collateral for reverse repurchase agreements: Type Maturity Value ------------------------------------------------------------------------------- Government National Mortgage Assn. 6.500% 10/20/2029 $ 98,963 ---------- (c) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount (Depreciation) ------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 0.470% and pay a fixed rate equal to 7.750%. Broker: Morgan Stanley Exp. 06/15/2005 $ 5,000 $ (368) Receive floating rate based on 3-month LIBOR plus 1.000% and pay to the counterparty the notional amount of $3,000 in exchange for shares of Nabors Industries, Inc. due 6/20/2020 when the convertible debentures mature. Broker: Morgan Stanley Exp. 06/20/2003 1,825 (69) ---------- $ (437) ---------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Principal amount of the security is adjusted for inflation. (f) Securities are grouped by coupon or range of coupons and represent a range of maturities. (g) Security is in default. 22 PIMCO Funds See accompanying notes Schedule of Investments U.S. Government Sector Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 16.9% -------------------------------------------------------------------------------- Banking & Finance 10.2% AT&T Capital Corp. 5.881% due 04/23/2002 (d) $ 1,000 $ 1,002 Bank One Corp. 5.462% due 05/07/2002 (d) 2,400 2,401 Bear Stearns Co., Inc. 7.125% due 03/28/2003 (d) 7,000 6,998 5.523% due 06/01/2004 (d) 2,000 1,977 Beneficial Corp. 5.293% due 03/01/2002 (d) 5,000 5,011 Bombardier Capital Trust I 5.583% due 06/09/2032 (d) 2,500 2,464 Chase Manhattan Corp. 6.440% due 05/15/2001 (d) 3,500 3,503 Deutsche Telekom International Finance 7.750% due 06/15/2005 10,000 10,333 Donaldson, Lufkin & Jenrette, Inc. 7.250% due 07/18/2003 (d) 3,000 3,009 Ford Motor Credit Co. 6.806% due 02/13/2003 (d) 3,000 2,981 5.132% due 03/17/2003 (d) 5,000 4,963 7.110% due 06/02/2003 (d) 1,900 1,897 5.190% due 06/20/2003 (d) 15,000 14,987 7.083% due 07/19/2004 (d) 1,800 1,788 7.173% due 07/18/2005 (d) 6,300 6,200 General Motors Acceptance Corp. 6.913% due 08/06/2001 (d) 3,500 3,505 6.950% due 03/10/2003 (d) 2,800 2,788 7.015% due 07/21/2003 (d) 4,900 4,907 6.251% due 04/05/2004 (d) 800 789 Goldman Sachs Group, Inc. 6.923% due 12/07/2001 (d) 8,000 8,017 Household Bank 6.227% due 10/22/2003 (d) 3,000 2,991 Lehman Brothers Holdings, Inc. 6.690% due 04/04/2003 (d) 2,100 2,103 MBNA America Bank NA 5.822% due 04/25/2002 (d) 800 799 Merrill Lynch & Co. 6.791% due 11/01/2001 (d) 2,300 2,303 Morgan Stanley, Dean Witter & Co. 6.837% due 01/28/2002 (d) 2,600 2,605 6.990% due 04/22/2004 (d) 5,800 5,807 National Australia Bank Ltd. 6.035% due 05/19/2010 (d) 2,500 2,517 National Rural Utilities Cooperative Finance Corp. 5.721% due 08/13/2002 (d) 10,000 10,002 Orix Credit Alliance, Inc. 6.785% due 04/16/2001 4,750 4,752 Protective Life Funding Trust 7.090% due 01/17/2003 (d) 1,500 1,503 Qwest Capital Funding, Inc. 6.875% due 08/15/2001 4,000 4,024 ---------- 128,926 ---------- Industrials 1.2% Clear Channel Communications, Inc. 5.583% due 06/15/2002 (d) 5,000 5,014 Cox Enterprises, Inc. 7.658% due 05/01/2033 (d) 2,000 2,001 DaimlerChrysler North America Holding Corp. 5.720% due 08/16/2004 (d) 7,000 6,823 International Paper Co. 7.670% due 07/08/2002 (d) 1,500 1,501 ---------- 15,339 ---------- Utilities 5.5% Arizona Public Service Co. 7.479% due 11/15/2001 (d) 1,500 1,502 Central Power & Light Co. 5.830% due 02/22/2002 (d) 2,000 2,002 France Telecom 6.307% due 03/14/2003 (d) 9,000 9,010 Pacific Gas & Electric Co. 7.057% due 10/31/2001 (d) 8,000 6,600 Scana Corp. 7.381% due 07/15/2002 (d) 2,900 2,905 Texas Utilities Corp. 5.420% due 06/25/2001 (d) 11,500 11,498 5.781% due 09/24/2001 (d) 7,100 7,079 Vodafone Group PLC 5.080% due 12/19/2001 (d) 26,800 26,845 WorldCom, Inc. 5.575% due 11/26/2001 (d) 2,000 1,994 ---------- 69,435 ---------- Total Corporate Bonds & Notes 213,700 (Cost $215,037) ---------- -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.5% -------------------------------------------------------------------------------- California 0.5% Kern County California Pension Obligation Revenue Bonds, (MBIA Insured), Series 1995 7.260% due 08/15/2014 6,000 6,469 ---------- Total Municipal Bonds & Notes 6,469 (Cost $6,269) ---------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 43.8% -------------------------------------------------------------------------------- Fannie Mae 6.850% due 11/06/2003 6,000 6,083 6.500% due 03/12/2009 44,900 45,219 6.625% due 11/15/2010 10,000 10,648 6.250% due 02/01/2011 20,000 20,317 5.500% due 03/15/2011 50,000 49,082 6.810% due 08/05/2013 500 500 0.000% due 10/09/2019 86,600 26,467 7.125% due 01/15/2030 (g) 40,000 44,548 6.210% due 08/06/2038 36,277 35,976 Federal Farm Credit Bank 6.000% due 03/07/2011 25,550 25,813 Federal Home Loan Bank 6.750% due 02/01/2002 (g) 35,000 35,122 5.950% due 12/10/2008 400 397 0.000% due 12/21/2018 8,000 2,434 Freddie Mac 5.500% due 02/12/2004 (g) 165,000 166,018 6.250% due 08/05/2008 500 500 6.000% due 12/29/2008 250 248 6.875% due 09/15/2010 (g) 50,000 54,113 6.750% due 09/15/2029 10,000 10,626 Resolution Funding Corporation Principle Strip 0.000% due 01/15/2030 10,000 1,820 SallieMae 6.781% due 01/25/2007 (d) 996 998 Small Business Administration 7.449% due 08/01/2010 2,395 2,528 Tennessee Valley Authority 7.125% due 05/01/2030 10,000 11,074 ---------- Total U.S. Government Agencies 550,531 (Cost $544,091) ---------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 88.6% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (f) 3.625% due 07/15/2002 (b) 42,224 43,055 3.625% due 01/15/2008 (g) 37,934 38,824 3.625% due 04/15/2028 5,846 5,961 3.875% due 04/15/2029 4,793 5,117 U.S. Treasury Bonds 14.000% due 11/15/2011 (g) 87,000 125,580 12.000% due 08/15/2013 (g) 112,300 159,993 8.125% due 08/15/2019 2,200 2,840 8.750% due 08/15/2020 (g) 146,100 200,435 8.125% due 05/15/2021 (g) 8,000 10,541 7.125% due 02/15/2023 14,500 17,223 6.250% due 08/15/2023 46,750 50,413 6.000% due 02/15/2026 (g) 113,300 118,831 5.500% due 08/15/2028 33,900 33,323 6.250% due 05/15/2030 26,450 29,058 2001 Annual Report See accompanying notes 23 Schedule of Investments (Cont.) U.S. Government Sector Portfolio March 31, 2001 Principal Amount Value (000s) (000s) U.S. Treasury Notes 6.375% due 01/31/2002 (g) $ 35,000 $ 35,079 4.250% due 11/15/2003 (g) 21,250 20,870 5.375% due 02/15/2031 (g) 100,050 98,581 U.S. Treasury Strips 0.000% due 08/15/2025 3,500 867 0.000% due 05/15/2013 20,700 10,840 0.000% due 02/15/2015 3,500 1,605 0.000% due 05/15/2015 37,300 16,962 0.000% due 02/15/2019 96,600 34,587 0.000% due 08/15/2020 2,400 785 0.000% due 11/15/2021 153,300 46,595 0.000% due 11/15/2024 25,000 6,434 ---------- Total U.S. Treasury Obligations 1,114,399 (Cost $1,102,933) ---------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 20.2% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 5.1% Bank of America Mortgage Securities, Inc. 7.250% due 02/25/2031 5,586 5,582 Freddie Mac 6.500% due 10/15/2016 3,474 3,484 6.000% due 12/15/2028 11,304 10,098 6.000% due 05/15/2029 112 97 7.000% due 10/15/2030 16,000 16,370 Merrill Lynch Mortgage Investors, Inc. 6.210% due 03/20/2017 195 195 Residential Funding Mortgage Securities I 7.500% due 11/25/2030 6,151 6,128 Sears Mortgage Securities 7.140% due 07/25/2019 1,774 1,767 Small Business Investment Cos. 8.017% due 02/10/2010 13,814 15,019 Washington Mutual, Inc. 7.070% due 01/25/2040 4,822 4,971 ---------- 63,711 ---------- Fannie Mae 1.2% 6.970% due 01/01/2029 (d) 2,109 2,182 7.500% due 02/12/2031 12,000 12,248 8.322% due 12/01/2022 (d) 399 411 ---------- 14,841 ---------- Government National Mortgage Association 13.9% 6.000% due 02/20/2030 (d) 31,866 32,127 6.375% due 05/20/2024 (d) 3,573 3,636 7.000% due 05/20/2030 (d) 8,760 8,845 7.375% due 04/20/2023-02/20/2026 (d)(e) 9,959 10,126 7.625% due 10/20/2023-10/20/2024 (d)(e) 2,240 2,297 7.750% due 07/20/2025-08/20/2026 (d)(e) 18,388 18,829 8.500% due 05/15/2030-12/15/2030 (e) 95,002 98,700 ---------- 174,560 ---------- Total Mortgage-Backed Securities 253,112 (Cost $249,878) ---------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 8.0% -------------------------------------------------------------------------------- Advanta Revolving Home Equity Loan Trust 5.420% due 01/25/2024 (d) 1,495 1,500 AFC Home Equity Loan Trust 5.350% due 06/25/2030 (d) 17,812 17,843 Bayview Financial Acquisition Trust 5.440% due 11/25/2030 (d) 8,000 8,000 Contimortgage Home Equity Loan Trust 5.778% due 08/15/2028 (d) 100 100 CS First Boston Mortgage Securities Corp. 5.423% due 12/15/2030 (d) 4,707 4,711 Empire Funding Home Loan Owner Trust 6.860% due 04/25/2016 6,086 6,105 EQCC Home Equity Loan Trust 8.340% due 08/15/2025 4,000 4,019 Household Consumer Loan Trust 5.583% due 08/15/2006 (d) 1,831 1,827 HPSC Equipment Receivables LLC 5.307% due 11/22/2007 (d) 14,301 14,301 Metris Master Trust 6.230% due 04/20/2006 (d) 1,700 1,712 NPF XII, Inc. 7.267% due 12/01/2003 (d) 10,000 10,000 PacificAmerica Home Equity Loan 5.700% due 06/26/2028 (d) 673 671 Provident Bank Equipment Lease Trust 5.830% due 11/25/2011 (d) 17,321 17,321 Residential Asset Securities Corp. 6.960% due 07/25/2014 1,701 1,702 7.615% due 01/25/2015 1,897 1,913 SallieMae 6.751% due 04/25/2007 (d) 3,581 3,582 Signet HELOC Trust 5.277% due 06/20/2004 (d) 1,696 1,698 The Money Store Home Equity Trust 5.343% due 06/15/2029 (d) 3,814 3,811 WMC Mortgage Loan 5.750% due 06/20/2028 (d) 290 290 ---------- Total Asset-Backed Securities 101,106 (Cost $100,945) ---------- -------------------------------------------------------------------------------- SUPRANATIONAL 3.2% -------------------------------------------------------------------------------- World Bank 7.625% due 01/19/2023 35,700 40,045 ---------- Total Supranational 40,045 (Cost $38,647) ---------- -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 0.0% -------------------------------------------------------------------------------- U.S. Treasury Note June Futures (CBOT) Strike @ 107.00 Exp. 05/26/2001 50,000 148 Strike @ 110.00 Exp. 05/26/2001 50,000 109 ---------- Total Purchased Call Options 257 (Cost $310) ---------- -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.1% -------------------------------------------------------------------------------- Interest Rate Swap (OTC) 6.180% due 05/30/2008 Strike @ 6.18 Exp. 05/25/2001 300,000 648 U.S. Treasury Bond (OTC) 9.250% due 02/15/2016 Strike @ 115.00 Exp. 05/01/2001 30,000 0 ---------- Total Purchased Put Options 648 (Cost $1,955) ---------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 0.6% -------------------------------------------------------------------------------- Industrial 0.6% Nabors Industries, Inc. 0.000% due 06/20/2020 10,000 7,075 ---------- Total Convertible Bonds & Notes 7,075 (Cost $6,192) ---------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 2.2% -------------------------------------------------------------------------------- Commercial Paper 0.4% Fannie Mae 4.700% due 05/16/2001 800 795 Reseau Ferre De France 4.590% due 07/25/2001 3,000 2,953 Williams Cos., Inc. 7.231% due 04/10/2001 1,600 1,600 ---------- 5,348 ---------- Repurchase Agreement 1.4% State Street Bank 4.600% due 04/02/2001 17,500 17,500 (Dated 03/30/2001. Collateralized by ---------- Freddie Mac 7.000% due 03/15/2010 valued at $17,851. Repurchase proceeds are $17,507.) 24 PIMCO Funds See accompanying notes Principal Amount Value (000s) (000s) U.S. Treasury Bills (b) 0.4% 4.802% due 05/17/2001 $ 5,070 $ 5,040 ----------- Total Short-Term Instruments 27,888 (Cost $27,891) ----------- Total Investments (a) 184.1% $2,315,230 (Cost $2,294,148) Written Options (c) (0.1%) (1,484) (Premiums $2,004) Other Assets and Liabilities (Net) (1,056,510) (84.0%) ----------- Net Assets 100.0% $1,257,236 Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $2,297,177 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 30,700 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (12,647) ----------- Unrealized appreciation-net $ 18,053 ----------- (b) Securities with an aggregate market value of $18,530 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) ------------------------------------------------------------------------------- U.S. Treasury 2 Year Note (06/2001) 147 $ 12 U.S. Treasury 5 Year Note (06/2001) 939 132 U.S. Treasury 10 Year Note (06/2001) 1,428 887 U.S. Treasury 30 Year Bond (06/2001) 2,518 (2,214) Municipal Bond (06/2001) 10 5 --------------- $ (1,178) --------------- (c) Premiums received on written options: # of Type Contracts Premium Value ------------------------------------------------------------------------------- Put - CBOT U.S. Treasury Bond June Futures Strike @ 103.00 Exp.05/26/2001 500 $ 99 $ 484 Put - CBOT U.S. Treasury Note June Futures Strike @ 103.00 Exp.05/26/2001 1,500 1,094 281 Call - CBOT 5 Year June Futures Strike @ 106.00 Exp.05/26/2001 500 294 305 Call - CBOT U.S.Treasury Note June Futures Strike @ 110.00 Exp.05/26/2001 50 19 11 Put - CBOT U.S. Treasury Note June Futures Strike @ 102.00 Exp.05/26/2001 50 11 5 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp.05/26/2001 500 302 273 Call - CBOT U.S. Treasury Bond June Futures Strike @ 109.00 Exp.05/26/2001 500 185 125 ------------------- $ 2,004 $ 1,484 ------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Securities are grouped by coupon or range of coupons and represent a range of maturities. (f) Principal amount of the security is adjusted for inflation. (g) Subject to financing transaction. (h) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) ------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 0.470% and pay a fixed rate equal to 7.750%. Broker: Morgan Stanley Exp. 06/15/2005 $ 10,000 $ (735) Receive floating rate based on 3-month LIBOR plus 1.000% and pay to the counterparty the notional amount of $10,000 in exchange for shares of Nabors Industries, Inc. due 6/20/2020 when the convertible debentures mature. Broker: Morgan Stanley Exp. 06/20/2003 6,084 (231) Receive floating rate based on 3-month LIBOR and pay a fixed rate equal to 6.826%. Broker: Morgan Stanley Exp. 10/26/2030 10,300 (741) Receive floating rate based on 3-month LIBOR and pay a fixed rate equal to 6.778%. Broker: Goldman Sachs Exp. 02/15/2021 19,200 (1,273) Receive a fixed rate equal to 6.000% and Pay floating rate based on 3-month LIBOR. Broker: Bank of America Exp. 06/15/2006 25,000 (96) Receive floating rate based on 3-month LIBOR and pay a fixed rate equal to 6.000%. Broker: Bank of America Exp. 06/15/2011 182,000 713 -------------- $ (2,363) -------------- Fixed Unrealized Spread Notional Appreciation/ Type (%) Amount (Depreciation) ------------------------------------------------------------------------------- Receive On-The-Run 10-year Swap Spread and pay a fixed spread. The On-The-Run 10-year Swap Spread is the difference between the 10-year Swap Rate and the 10-year Treasury Rate. Broker: Bank of America Exp. 06/17/2002 1.3100 $ 53,750 $ (1,063) Receive a fixed spread and pay On-The-Run 10-year Swap Spread. The On-The-Run 10-year Swap Spread is the difference between the 10-year Swap Rate and the 10-year Treasury Rate. Broker: Bank of America Exp. 06/15/2001 1.3200 50,000 1,343 Receive the 10-year Swap Spread and pay a fixed spread. The 10-year Swap Spread is the difference between the 10-year Swap Rate and the 10-year Treasury Rate. Broker: Morgan Stanley Exp. 06/29/2015 1.3367 20,000 (339) Receive a fixed spread and pay 5-year Swap Spread. The 5-year Swap Spread is the difference between the 5-year Swap Rate and the 5-year Treasury Rate. Broker: Goldman Sachs Exp. 05/15/2006 1.0500 50,000 386 -------------- $ 327 -------------- 2001 Annual Report See accompanying notes 25 Schedule of Investments Investment Grade Corporate Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 80.1% -------------------------------------------------------------------------------- Banking & Finance 26.0% Abbey National Capital Trust I 1.000% due 12/29/2049 $ 8,800 $ 9,758 AMERCO 7.200% due 04/01/2002 1,000 989 AT&T Capital Corp. 7.010% due 04/23/2002 (d) 5,400 5,413 Bank of America Corp. 6.875% due 02/15/2005 605 627 9.375% due 09/15/2009 300 353 7.400% due 01/15/2011 8,000 8,416 Bank of Tokyo - Mitsubishi 8.400% due 04/15/2010 1,500 1,612 Barclays Bank PLC 8.550% due 09/29/2049 500 554 Bear Stearns Co., Inc. 5.200% due 06/28/2001 (d) 200 200 6.500% due 08/01/2002 2,000 2,024 6.200% due 03/30/2003 5,400 5,453 6.150% due 03/02/2004 2,300 2,316 Beneficial Corp. 8.400% due 05/15/2008 140 152 Capital One Bank 6.760% due 07/23/2002 800 808 Cincinnati Financial Corp. 6.900% due 05/15/2028 10,000 8,953 Citifinancial 6.750% due 07/01/2007 2,000 2,066 Citigroup, Inc. 6.500% due 01/18/2011 5,000 5,047 Credit Asset Receivable 6.274% due 10/31/2003 339 341 Deutsche Telekom International Finance 7.750% due 06/15/2005 11,000 11,366 8.250% due 06/15/2030 5,000 4,827 Diageo Capital PLC 6.625% due 06/24/2004 2,000 2,072 Donaldson, Lufkin & Jenrette, Inc. 6.875% due 11/01/2005 1,125 1,172 Duke Capital Corp. 7.250% due 10/01/2004 700 734 Export-Import Bank Korea 7.100% due 03/15/2007 2,000 2,079 Federal Home Loan Bank 6.53% due 12/30/2013 1,000 986 Finova Capital Corp. 6.080% due 03/12/2002 (g) 1,750 1,454 First Security Corp. 5.875% due 11/01/2003 1,000 1,010 Fleet Boston Financial Corp. 7.250% due 09/15/2005 2,900 3,080 Ford Motor Credit Co. 6.125% due 04/28/2003 3,600 3,638 1.000% due 11/24/2003 (d) 7,000 6,987 5.750% due 02/23/2004 4,300 4,298 6.125% due 03/20/2004 3,000 3,027 6.700% due 07/16/2004 1,100 1,126 7.500% due 03/15/2005 6,000 6,283 6.750% due 05/15/2005 1,000 1,021 6.888% due 06/30/2005 (d) 5,000 4,941 7.600% due 08/01/2005 8,000 8,429 General Motors Acceptance Corp. 9.625% due 12/15/2001 300 309 7.050% due 04/24/2002 500 509 5.608% due 11/12/2002 (d) 3,300 3,291 6.450% due 11/13/2002 1,000 1,016 1.000% due 02/14/2003 (d) 2,000 1,992 5.510% due 08/18/2003 (d) 2,000 1,998 5.750% due 11/10/2003 2,200 2,205 6.536% due 04/05/2004 (d) 500 493 7.625% due 06/15/2004 1,500 1,576 7.250% due 03/02/2011 20,000 20,519 Goldman Sachs Group, Inc. 5.900% due 01/15/2003 1,000 1,009 Heller Financial, Inc. 7.875% due 05/15/2003 1,700 1,777 Household Finance Corp. 6.125% due 02/27/2003 2,000 2,017 IBM Credit Corp. 7.000% due 11/05/2007 500 500 KBC Bank Fund Trust III 9.860% due 11/29/2049 (d) 9,000 10,095 Korea Development Bank 7.900% due 02/01/2002 1,000 1,015 7.625% due 10/01/2002 5,750 5,897 7.125% due 04/22/2004 600 612 Lehman Brothers Holdings, Inc. 6.500% due 10/01/2002 230 234 0.000% due 03/25/2028 1,381 145 LG&E Capital Corp. 6.205% due 05/01/2004 1,000 966 Marsh & McLennan Cos., Inc. 6.625% due 06/15/2004 1,000 1,033 MBNA America Bank NA 6.875% due 07/15/2004 800 804 Morgan Stanley Group, Inc. 7.000% due 05/28/2019 300 296 Nations Bank Corp. 5.975% due 08/01/2002 2,000 2,000 Nordbanken AB 7.250% due 11/12/2009 2,700 2,804 Popular North American, Inc. 7.375% due 09/15/2001 1,900 1,920 PP&L Capital Funding, Inc. 7.750% due 04/15/2005 8,000 8,279 Premium Asset Trust 6.166% due 10/06/2005 (d) 1,400 1,399 PS Colorado Credit Corp. 5.843% due 05/30/2002 (d) 2,000 1,998 Qwest Capital Funding, Inc. 7.250% due 02/15/2011 4,000 4,082 Royal Bank of Scotland Group PLC 8.817% due 03/31/2049 2,500 2,708 9.118% due 03/31/2049 10,000 11,389 Sanwa Finance Aruba AEC 8.350% due 07/15/2009 3,900 4,098 Sears Roebuck Acceptance Corp. 6.990% due 09/30/2002 600 616 Secured Finance, Inc. 9.050% due 12/15/2004 250 280 Societe Generale 9.875% due 07/15/2003 1,900 2,075 Source One Mortgage Corp. 9.000% due 06/01/2012 200 237 Washington Mutual, Inc. 8.250% due 10/01/2002 600 623 Wells Fargo & Co. 7.221% due 05/02/2005 (d) 11,225 11,216 Westdeutsche Landesbank 6.750% due 06/15/2005 20,000 20,517 ---------- 260,161 ---------- Industrials 26.4% America West Airlines, Inc. 9.244% due 01/02/2022 4,952 5,231 American Airlines, Inc. 9.710% due 01/30/2007 2,365 2,548 British Telecom PLC 8.625% due 12/15/2030 5,000 5,175 Coastal Corp. 5.553% due 03/06/2002 (d) 1,200 1,200 6.125% due 07/21/2003 (d) 1,000 1,003 Cox Communications, Inc. 6.500% due 11/15/2002 740 748 6.150% due 08/01/2003 1,100 1,106 Cox Enterprises, Inc. 6.625% due 06/14/2002 700 708 8.000% due 02/15/2007 3,000 3,167 26 PIMCO Funds See accompanying notes Principal Amount Value (000s) (000s) DaimlerChrysler North America Holding Corp. 5.720% due 08/16/2004 (d) $ 2,000 $ 1,950 7.250% due 01/18/2006 4,000 4,101 8.500% due 01/18/2031 14,200 14,615 Delta Air Lines Equipment Trust 10.430% due 01/02/2011 2,429 2,616 10.140% due 08/14/2012 4,000 4,409 Delta Air Lines, Inc. 10.570% due 01/02/2007 (f) 7,006 8,193 7.379% due 05/18/2010 2,000 2,121 7.920% due 11/18/2010 1,970 2,120 10.500% due 04/30/2016 3,400 3,898 Dillards, Inc. 9.500% due 10/15/2001 300 296 Ford Motor Co. 7.125% due 11/15/2025 340 322 7.450% due 07/16/2031 3,000 2,957 Fred Meyer, Inc. 7.375% due 03/01/2005 18,220 19,086 General Motors Corp. 6.250% due 05/01/2005 2,000 2,019 7.200% due 01/15/2011 1,000 1,027 Hilton Hotels 7.700% due 07/15/2002 3,000 3,042 Houghton Mifflin Co. 5.970% due 12/03/2001 1,000 1,004 ICI Wilmington, Inc. 7.500% due 01/15/2002 2,000 2,023 Kinder Morgan Energy Partners LP 1.000% due 03/22/2002 10,000 10,007 Lehman Brothers Holdings, Inc. 8.800% due 03/01/2015 700 807 MGM Grand, Inc. 6.950% due 02/01/2005 2,300 2,298 Midwest Generation LLC 8.560% due 01/02/2016 6,000 5,808 Nabisco, Inc. 6.125% due 02/01/2033 800 804 Occidental Petroleum Corp. 6.400% due 04/01/2003 9,600 9,667 Park Place Entertainment Corp. 7.950% due 08/01/2003 6,500 6,678 Petroleos Mexicanos 7.844% due 07/15/2005 (d) 3,100 3,108 Philip Morris Cos., Inc. 7.500% due 01/15/2002 4,000 4,053 6.800% due 12/01/2003 1,762 1,818 7.125% due 10/01/2004 2,000 2,074 Ralcorp Holdings, Inc. 8.750% due 09/15/2004 7,650 8,507 Raytheon Co. 5.738% due 08/10/2001 (d) 2,000 2,002 Safeway, Inc. 5.875% due 11/15/2001 10,165 10,225 7.000% due 09/15/2002 1,600 1,629 Spieker Properties LP 8.000% due 07/19/2005 500 534 Sprint Spectrum LP 12.500% due 08/15/2006 200 207 11.000% due 08/15/2006 2,250 2,396 TCI Communications, Inc. 1.000% due 04/01/2002 (d) 2,000 2,011 5.520% due 04/03/2002 (d) 6,300 6,335 6.375% due 05/01/2003 3,300 3,349 7.550% due 09/02/2003 3,000 3,136 Tele-Communications, Inc. 9.250% due 04/15/2002 14,500 14,983 8.250% due 01/15/2003 5,000 5,205 Time Warner, Inc. 6.850% due 01/15/2026 300 306 Unilever Capital Corp. 6.875% due 11/01/2005 750 791 Union Pacific Corp. 9.625% due 12/15/2002 300 320 United Air Lines, Inc. 9.000% due 12/15/2003 4,500 4,609 11.080% due 03/26/2010 13,872 16,103 11.080% due 03/26/2011 2,835 3,368 10.020% due 03/22/2014 2,000 2,163 10.850% due 02/19/2015 1,000 1,150 10.125% due 03/22/2015 2,300 2,513 Universal Corp. 8.500% due 02/28/2003 220 233 US Airways, Inc. 8.020% due 02/05/2019 (f) 7,300 7,929 Walmart Bond Lease Corp. 8.400% due 08/15/2003 5,000 5,271 Wal-Mart Stores, Inc. 8.875% due 06/29/2011 300 307 Waste Management, Inc. 6.000% due 05/15/2001 6,200 6,192 6.625% due 07/15/2002 1,100 1,100 7.700% due 10/01/2002 2,500 2,544 6.500% due 05/14/2004 2,500 2,500 7.125% due 10/01/2007 2,275 2,290 ---------- 264,015 ---------- Utilities 27.7% Arizona Public Service 8.125% due 03/15/2002 1,000 1,025 AT&T Corp. 9.650% due 10/01/2003 2,984 3,166 7.500% due 06/01/2006 1,257 1,319 AT&T Wireless Services, Inc. 7.875% due 03/01/2011 9,500 9,595 Baltimore Gas & Electric 6.750% due 12/15/2002 3,000 3,055 British Telecommunications PLC 7.625% due 12/15/2005 7,650 7,923 8.125% due 12/15/2010 (d) 22,300 23,299 Carolina Power & Light Energy, Inc. 1.000% due 07/29/2002 (d) 5,800 5,813 CenturyTel, Inc. 7.750% due 10/15/2002 1,700 1,730 Cincinnati Gas & Electric Co. 6.450% due 02/15/2004 3,000 3,041 6.900% due 06/01/2025 3,000 3,066 Cleveland Electric Illuminating Co. 7.670% due 07/01/2004 4,900 5,129 9.500% due 05/15/2005 5,000 5,175 7.130% due 07/01/2007 150 155 CMS Panhandle Holding Co. 6.125% due 03/15/2004 1,000 992 Coastal Corp. 9.750% due 08/01/2003 2,800 3,046 Commonwealth Edison Co. 7.145% due 09/30/2003 (d) 2,000 2,001 Consolidated Natural Gas Co. 7.250% due 10/01/2004 3,000 3,129 Detroit Edison Co. 7.500% due 02/01/2005 8,000 8,389 Deutsche Telekom 8.000% due 06/15/2010 7,000 7,111 Dominion Resources, Inc. 7.600% due 07/15/2003 5,000 5,205 8.125% due 06/15/2010 2,500 2,768 Edison International, Inc. 7.775% due 11/01/2001 (d) 300 257 El Paso Energy Corp. 7.383% due 07/15/2001 (d) 200 200 Entergy Mississippi, Inc. 7.750% due 02/15/2003 1,000 1,035 Exelon Corp. 5.625% due 11/01/2001 1,700 1,705 France Telecom 7.200% due 03/01/2006 10,000 10,177 7.750% due 03/01/2011 24,700 24,906 8.500% due 03/01/2031 11,000 11,138 2001 Annual Report See accompanying notes 27 Schedule of Investments (Cont.) Investment Grade Corporate Portfolio March 31, 2001 Principal Amount Value (000s) (000s) Idaho Power Corp. 6.600% due 03/02/2011 $ 4,000 $ 4,023 Kinder Morgan, Inc. 6.450% due 11/30/2001 6,685 6,720 Marlin Water Trust 7.090% due 12/15/2001 4,197 4,234 Niagara Mohawk Power Co. 7.125% due 07/01/2001 2,193 2,202 9.250% due 10/01/2001 5,800 5,916 5.875% due 09/01/2002 8,600 8,672 7.250% due 10/01/2002 1,134 1,155 7.375% due 07/01/2003 2,079 2,133 Noram Energy Corp. 6.375% due 11/01/2003 9,000 9,187 Ohio Power Co. 7.000% due 07/01/2004 3,400 3,491 Phillips Petroleum Co. 8.750% due 05/25/2010 5,000 5,806 PP&L Capital Funding 7.700% due 11/15/2002 (d) 2,800 2,893 Progress Energy, Inc. 6.550% due 03/01/2004 9,000 9,195 Public Service Electric & Gas Co. 6.125% due 08/01/2002 450 455 R & B Falcon Corp. 10.250% due 05/15/2003 560 579 Reliant Energy Resources Corp. 8.125% due 07/15/2005 1,400 1,476 Rowan Co., Inc. 5.880% due 03/15/2012 3,205 3,268 Southern California Edison Co. 7.203% due 05/01/2002 (d) 2,000 1,630 Texas Utilities Corp. 5.781% due 09/24/2001 (d) 1,900 1,894 5.940% due 10/15/2001 10,400 10,448 Texas Utilities Electric Co. 7.286% due 12/20/2002 (d) 2,000 2,001 Viacom, Inc. 8.375% due 06/15/2002 370 383 Virginia Electric & Power Co. 5.750% due 03/31/2006 10,000 9,882 Vodafone Group PLC 7.500% due 07/15/2006 1,020 1,082 7.750% due 02/15/2010 500 540 Williams Cos., Inc. 5.888% due 11/15/2001 (d) 2,000 2,003 WorldCom, Inc. 6.125% due 04/15/2002 6,100 6,110 7.375% due 01/15/2003 1,900 1,922 8.875% due 01/15/2006 11,310 11,681 ---------- 276,531 ---------- Total Corporate Bonds & Notes 800,707 (Cost $786,908) ---------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.5% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (c) 3.625% due 07/15/2002 (b) 873 890 U.S. Treasury Bonds 7.500% due 11/15/2016 300 362 7.875% due 02/15/2021 600 762 8.125% due 08/15/2021 1,800 2,346 6.250% due 08/15/2023 1,300 1,402 ---------- Total U.S. Treasury Obligations 5,762 (Cost $5,646) ---------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 11.1% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 0.3% Bank of America Mortgage Securities, Inc. 6.500% due 04/25/2029 149 149 Freddie Mac 6.250% due 03/15/2028 3,000 2,867 ---------- 3,016 ---------- Fannie Mae 1.9% 7.000% due 05/14/2031 17,500 17,686 7.500% due 04/16/2031 1,529 1,529 ---------- 19,215 ---------- Government National Mortgage Association 8.9% 6.000% due 01/15/2029-10/15/2030 (h) 32,508 31,923 7.500% due 04/23/2031 9,000 9,225 8.000% due 04/23/2031 37,000 38,191 8.500% due 07/15/2030-08/15/2030 (h) 9,146 9,500 ---------- 88,839 ---------- Total Mortgage-Backed Securities 111,070 (Cost $110,184) ---------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 0.5% -------------------------------------------------------------------------------- Conseco Finance Securitizations Corp. 7.970% due 05/01/2032 2,000 2,106 Denver Arena Trust 6.940% due 11/15/2019 2,899 2,786 ---------- Total Asset-Backed Securities 4,892 (Cost $4,531) ---------- -------------------------------------------------------------------------------- SOVEREIGN ISSUES 1.8% -------------------------------------------------------------------------------- Province of Quebec 6.500% due 01/17/2006 1,000 1,038 6.620% due 04/09/2026 14,000 14,873 Republic of Croatia 6.250% due 07/31/2006 (d) 1,819 1,778 ---------- Total Sovereign Issues 17,689 (Cost $17,701) ---------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 15.7% -------------------------------------------------------------------------------- Commercial Paper 0.3% UBS Finance, Inc. 4.770% due 08/15/2001 1,800 1,767 Williams Cos., Inc. 7.231% due 04/10/2001 800 800 ---------- 2,567 ---------- Repurchase Agreement 15.4% State Street Bank 4.600% due 04/02/2001 957 957 (Dated 03/30/2001. Collateralized by Freddie Mac 6.680% due 12/28/2001 valued at $981. Repurchase proceeds are $957.) First Boston 5.200% due 04/02/2001 153,000 153,000 (Dated 03/31/2000. Collateralized by U.S. Treasury Note 7.025% due 05/15/2016 valued at $156,529. Repurchase proceeds are $153,066.) ---------- 153,957 ---------- U.S. Treasury Bills 0.0% 4.560% due 05/17/2001 (b) 200 199 ---------- Total Short-Term Instruments 156,723 (Cost $156,724) ---------- Total Investments (a) 109.7% $1,096,843 (Cost $1,081,694) Other Assets and Liabilities (Net) (9.7%) (97,202) ---------- Net Assets 100.0% $ 999,641 ---------- 28 PIMCO Funds See accompanying notes Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $1,081,694 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 17,901 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (2,752) ---------- Unrealized appreciation-net $ 15,149 ---------- (b) Securities with an aggregate market value of $1,089 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 30 Year Bond (06/2001) 176 $ (254) Eurodollar September Futures (09/2002) 24 (8) Eurodollar March Futures (03/2003) 24 (11) Eurodollar June Futures (06/2002) 24 (7) Eurodollar December Futures (12/2002) 24 (10) -------------- $ (290) -------------- (c) Principal amount of the security is adjusted for inflation. (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Swap agreements outstanding at March 31, 2001: Notional Unrealized Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 0.500% and pay a fixed rate equal to 7.600%. Broker: Lehman Brothers Exp. 07/15/2003 $ 5,000 $ (235) Receive a fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 06/15/2006 164,900 (400) -------------- $ (635) -------------- (f) Restricted security. (g) Security is in default. (h) Securities are grouped by coupon or range of coupons and represent a range of matuities. 2001 Annual Report See accompanying notes 29 Schedule of Investments High Yield Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 81.6% -------------------------------------------------------------------------------- Banking & Finance 6.1% Americo Life, Inc. 9.250% due 06/01/2005 $ 52 $ 51 Amethyst Financial Co. Ltd. 11.750% due 10/29/2001 1,056 1,056 Arvin Capital 9.500% due 02/01/2027 4,014 2,910 General Motors Acceptance Corp. 5.722% due 04/29/2002 (d) 169 169 Golden State Holdings 7.125% due 08/01/2005 183 179 Host Marriott LP 8.375% due 02/15/2006 2,463 2,451 9.250% due 10/01/2007 1,250 1,278 Reliance Group Holdings, Inc. 9.000% due 11/15/2049 1,009 88 Telewest Credit Links 10.875% due 02/07/2005 3,000 2,537 Wilmingtom Trust (Tucson) 10.732% due 01/01/2013 (c) 1,851 2,126 ---------- 12,845 ---------- Industrials 62.4% 360 Networks, Inc. 13.000% due 05/01/2008 1,010 389 Allied Waste North America, Inc. 10.000% due 08/01/2009 1,250 1,281 American Airlines, Inc. 10.610% due 03/04/2010 137 155 American Media Operation, Inc. 10.250% due 05/01/2009 211 216 American Standard Cos., Inc. 7.125% due 02/15/2003 42 42 AmeriGas Partners LP 10.125% due 04/15/2007 633 655 AM-FM, Inc. 8.750% due 06/15/2007 1,193 1,256 8.000% due 11/01/2008 1,056 1,101 Amphenol Corp. 9.875% due 05/15/2007 1,431 1,506 Archibald Candy Corp. 10.250% due 07/01/2004 95 50 Ball Corp. 8.250% due 08/01/2008 394 403 Beckman Instruments, Inc. 7.100% due 03/04/2003 1,358 1,368 British Sky Broadcasting PLC 7.300% due 10/15/2006 2,750 2,701 Browning-Ferris Industries, Inc. 6.100% due 01/15/2003 (d) 866 844 7.875% due 03/15/2005 422 421 Call-Net Enterprises, Inc. 8.000% due 08/15/2008 1,785 550 Canadian Forest Oil Ltd. 8.750% due 09/15/2007 3,718 3,811 Century Communications Corp. 9.750% due 02/15/2002 137 138 9.500% due 03/01/2005 3,000 2,996 8.750% due 10/01/2007 802 774 CF Cable TV, Inc. 9.125% due 07/15/2007 2,451 2,496 Charter Communications Holdings 10.750% due 10/01/2009 2,500 2,675 8.625% due 04/01/2009 56 54 Clark R & M, Inc. 8.375% due 11/15/2007 633 491 Crown Castle International Corp. 0.000% due 11/15/2007 (e) 475 394 10.750% due 08/01/2011 845 877 CSC Holdings, Inc. 7.875% due 12/15/2007 21 21 7.625% due 04/01/2011 1,500 1,471 Delta Air Lines, Inc. 10.790% due 03/26/2014 478 532 Diamond Cable Communication Co. 1.000% due 09/30/2004 316 310 11.750% due 12/15/2005 2,113 1,965 Fairpoint Communications, Inc. 10.908% due 05/01/2008 (d) 950 895 Flag Telecom Holding Ltd. 11.625% due 03/30/2010 4,056 3,103 Forest Oil Corp. 10.500% due 01/15/2006 757 799 Global Crossing Holding Ltd. 9.500% due 11/15/2009 1,056 995 Golden Northwest Aluminum 12.000% due 12/15/2006 517 442 Gulf Canada Resources Ltd. 9.625% due 07/01/2005 597 618 8.375% due 11/15/2005 845 917 Harrahs Operating Co., Inc. 7.875% due 12/15/2005 1,000 1,005 HCA - The Healthcare Co. 6.870% due 09/15/2003 274 276 6.910% due 06/15/2005 264 260 7.000% due 07/01/2007 707 687 8.360% due 04/15/2024 1,267 1,228 6.730% due 07/15/2045 1,306 1,320 HMH Properties, Inc. 7.875% due 08/01/2005 1,000 973 Hollinger International Publishing 8.625% due 03/15/2005 52 53 9.250% due 02/01/2006 971 1,000 9.250% due 03/15/2007 143 148 HS Resources, Inc. 9.875% due 12/01/2003 771 786 Huntsman Corp. 9.500% due 07/01/2007 2,682 2,078 Huntsman Polymers Corp. 11.750% due 12/01/2004 971 811 International Game Technology 7.875% due 05/15/2004 3,000 3,045 8.375% due 05/15/2009 2,000 2,060 Jones Intercable, Inc. 8.875% due 04/01/2007 1,069 1,148 K Mart Corp. 8.800% due 07/01/2010 242 219 9.350% due 01/02/2020 2,733 2,136 9.780% due 01/05/2020 2,023 1,723 Lenfest Communications 10.500% due 06/15/2006 110 130 Level 3 Communications, Inc. 9.125% due 05/01/2008 2,000 1,430 11.250% due 03/15/2010 211 166 Leviathan Gas Corp. 10.375% due 06/01/2009 702 755 Lin Holdings Corp. 0.000% due 03/01/2008 (e) 2,000 1,420 Mandalay Resort Group 6.750% due 07/15/2003 4,173 4,037 6.450% due 02/01/2006 21 20 Manor Care, Inc. 8.000% due 03/01/2008 750 767 McLeodUSA, Inc. 0.000% due 03/01/2007 (e) 2,700 2,228 12.000% due 07/15/2008 2,125 2,136 11.500% due 05/01/2009 3,711 3,637 Mediacom LLC 9.500% due 01/15/2013 1,500 1,474 Metromedia Fiber Network, Inc. 10.000% due 11/15/2008 594 496 Mirage Resorts, Inc. 7.250% due 10/15/2006 564 565 Nextel Communications, Inc. 9.375% due 11/15/2009 1,000 853 NTL, Inc. 12.750% due 04/15/2005 147 140 Octel Developments PLC 10.000% due 05/01/2006 401 403 30 PIMCO Funds See accompanying notes Principal Amount Value (000s) (000s) Orion Network Systems, Inc. 11.250% due 01/15/2007 $ 3,090 $ 1,143 0.000% due 01/15/2007 (e) 2,915 787 P&L Coal Holdings 8.875% due 05/15/2008 4,025 4,216 Park Place Entertainment 7.875% due 12/15/2005 1,500 1,498 Piedmont Aviation, Inc. 10.250% due 03/28/2005 120 119 9.900% due 11/08/2006 351 341 Pioneer National Resources Co. 8.875% due 04/15/2005 1,747 1,846 Price Communications Wireless, Inc. 9.125% due 12/15/2006 1,128 1,165 R.H. Donnelley, Inc. 9.125% due 06/01/2008 1,420 1,456 Racers 8.375% due 10/01/2007 4,170 3,391 Renaissance Media Group 0.000% due 04/15/2008 (e) 4,490 3,435 Rogers Cablesystems Ltd. 10.000% due 03/15/2005 845 908 Rogers Cantel, Inc. 8.800% due 10/01/2007 285 286 8.300% due 10/01/2007 944 937 9.375% due 06/01/2008 4,976 5,187 Safety-Kleen Corp. 9.250% due 06/01/2008 (b) 6,016 75 9.250% due 05/15/2009 (b) 2,958 37 Scotia Pacific Co. LLC 7.710% due 01/20/2014 (d) 38 28 Smithfield Foods 7.625% due 02/15/2008 468 459 Smith's Food & Drug Centers, Inc. 8.640% due 07/02/2012 61 66 Station Casinos, Inc. 10.125% due 03/15/2006 209 217 8.875% due 12/01/2008 169 171 9.875% due 07/01/2010 211 220 Sterling Chemicals, Inc. 12.375% due 07/15/2006 1,000 935 Telewest Communications PLC 11.000% due 10/01/2007 (d) 3,563 3,510 11.250% due 11/01/2008 211 213 Tenet Healthcare Corp. 7.875% due 01/15/2003 211 215 8.000% due 01/15/2005 1,499 1,546 8.625% due 01/15/2007 739 770 7.625% due 06/01/2008 4,245 4,293 U.S. Airways, Inc. 9.625% due 09/01/2003 1,465 1,478 9.330% due 01/01/2006 878 856 United Defense Industries, Inc. 8.750% due 11/15/2007 211 209 United Pan-Europe Communications NV 10.875% due 08/01/2009 2,915 1,968 0.000% due 02/01/2010 (e) 750 251 VoiceStream Wireless Corp. 10.375% due 11/15/2009 845 930 Waste Management, Inc. 7.000% due 05/15/2005 137 139 Western Gas Resources, Inc. 10.000% due 06/15/2009 1,500 1,598 Worldwide Fiber, Inc. 12.000% due 08/01/2009 11,031 4,137 ---------- 132,361 ---------- Utilities 13.1% AES Corp. 9.375% due 09/15/2010 1,000 1,055 8.875% due 02/15/2011 2,426 2,493 AT&T Canada, Inc. 0.000% due 06/15/2008 (e) 3,481 2,898 10.625% due 11/01/2008 2,028 2,251 Calpine Corp. 8.625% due 08/15/2010 2,000 2,072 8.500% due 02/15/2011 3,000 3,086 Carolina Power & Light Energy, Inc. 7.278% due 07/29/2002 (d) 612 612 Chesapeake Energy Corp. 7.875% due 03/15/2004 2,030 2,030 9.625% due 05/01/2005 750 821 CMS Energy Corp. 6.750% due 01/15/2004 158 154 8.500% due 04/15/2011 1,000 973 Nextel Partners, Inc. 11.000% due 03/15/2010 42 37 Rogers Communications 9.125% due 01/15/2006 4,000 4,090 Williams Cos., Inc. 7.259% due 11/15/2001 (d) 1,288 1,290 XO Communications, Inc. 12.750% due 12/15/2007 3,000 2,115 0.000% due 04/15/2008 (e) 4,500 1,823 ---------- 27,800 ---------- Total Corporate Bonds & Notes 173,006 (Cost $177,083) ---------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 7.8% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 7.7% Federal Deposit Insurance Corp. 7.871% due 11/25/2026 (d) 400 400 LTC Commercial Corp. 9.200% due 08/04/2023 1,000 1,083 7.970% due 04/15/2028 1,069 1,004 NationsBanc Mortgage Capital Corp. 8.035% due 05/25/2028 800 702 Red Mountain Funding Corp. 9.150% due 11/28/2027 1,210 824 Resolution Trust Corp. 6.900% due 02/25/2027 989 962 7.000% due 05/25/2027 1,183 1,181 Sasco Floating Rate Commercial Mortgage Trust 6.080% due 04/25/2003 (d) 6,296 6,263 Structured Asset Securities Corp. 7.050% due 11/25/2007 4,000 4,057 ---------- 16,476 ---------- Stripped Mortgage-Backed Securities 0.1% Fannie Mae (IO) 7.000% due 07/25/2008 366 44 6.500% due 06/25/2017 9 0 7.000% due 04/25/2019 1,598 65 7.000% due 12/25/2021 564 62 ---------- 171 ---------- Total Mortgage-Backed Securities 16,647 (Cost $16,338) ---------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 5.9% -------------------------------------------------------------------------------- Airplanes Pass Through Trust 10.875% due 03/15/2019 6,025 3,972 Airtrust 10.582% due 06/01/2013 2,387 897 Charter Commercial Holdings LLC 9.260% due 03/31/2008 0 0 Conseco Finance 9.300% due 10/15/2030 2,000 2,116 Flag Ltd. 7.312% due 03/31/2006 1,570 1,566 Green Tree Financial Corp. 8.000% due 07/15/2018 1,000 883 Morgan Stanley Aircraft Finance 8.700% due 03/15/2023 4,709 3,146 ---------- Total Asset-Backed Securities 12,580 (Cost $12,893) ---------- 2001 Annual Report See accompanying notes 31 Schedule of Investments (Cont.) High Yield Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 1.4% -------------------------------------------------------------------------------- Health Care 0.3% Tenet Healthcare Corp. 6.000% due 12/01/2005 $ 686 $ 621 ---------- Industrial 1.1% Hilton Hotels Corp. 5.000% due 05/15/2006 211 182 Pride International, Inc. 0.000% due 04/24/2018 (e) 2,482 1,111 Waste Management, Inc. 4.000% due 02/01/2002 1,162 1,127 ---------- 2,420 ---------- Total Convertible Bonds & Notes 3,041 (Cost $2,878) ---------- -------------------------------------------------------------------------------- PREFERRED STOCK 1.3% -------------------------------------------------------------------------------- Shares Newscorp Overseas Ltd. 8.625% due 12/31/2049 28,100 672 Primedia, Inc. 9.200% due 11/01/2009 14,700 1,275 8.625% due 04/01/2010 10,500 879 ---------- Total Preferred Stock 2,826 (Cost $2,587) ---------- Total Investments (a) 98.0% $ 208,100 (Cost $211,779) Other Assets and Liabilities (Net) 2.0% 4,147 ---------- Net Assets 100.0% $ 212,247 ---------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $211,804 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 6,017 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (9,721) ---------- Unrealized depreciation-net $ (3,704) ---------- (b) Security is in default. (c) Restricted security. (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Security becomes interest bearing at a future date. (f) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) ------------------------------------------------------------------------------- Buy EC 2,800 04/2001 $ (9) Sell 2,800 04/2001 148 Sell 2,800 06/2001 9 -------------- $ 148 -------------- (g) Principal amount denoted in indicated currency: EC - Euro 32 PIMCO Funds See accompanying notes Schedule of Investments Mortgage Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 7.5% -------------------------------------------------------------------------------- Banking & Finance 3.2% Bear Stearns Co., Inc. 5.210% due 03/28/2003 (d) $ 3,700 $ 3,699 5.717% due 05/06/2003 (d) 1,300 1,302 5.725% due 05/16/2003 (d) 2,500 2,480 5.230% due 07/22/2003 (d) 3,200 3,165 5.523% due 06/01/2004 (d) 2,700 2,669 5.723% due 11/30/2004 (d) 6,200 6,212 Capital One Bank 6.847% due 01/27/2004 (d) 9,800 9,705 CS First Boston Mortgage Securities Corp. 7.056% due 11/15/2001 (d) 3,795 3,795 Finova Capital Corp. 6.040% due 11/08/2002 (d)(k) 3,500 2,874 Ford Motor Credit Co. 5.605% due 11/24/2003 (d) 3,000 2,995 6.088% due 07/19/2004 (d) 8,500 8,443 General Motors Acceptance Corp. 5.608% due 11/12/2002 (d) 900 898 5.547% due 02/14/2003 (d) 4,500 4,483 6.393% due 07/20/2003 (d) 521 521 6.536% due 04/05/2004 (d) 15,300 15,082 6.353% due 09/20/2004 (d) 938 937 Goldman Sachs Group, Inc. 5.971% due 01/17/2003 (d) 1,000 1,002 Heller Financial, Inc. 5.978% due 10/22/2001 (d) 600 600 5.192% due 03/19/2002 (d) 1,800 1,800 5.290% due 06/10/2002 (d) 3,000 3,001 Household Bank 5.760% due 10/22/2003 (d) 7,000 6,979 Lehman Brothers Holdings, Inc. 6.478% due 07/15/2002 (d) 1,200 1,208 6.771% due 04/04/2003 (d) 6,100 6,109 MBNA Corp. 5.610% due 08/07/2001 (d) 100 100 5.435% due 12/10/2002 (d) 7,250 7,131 Morgan Stanley, Dean Witter & Co. 5.583% due 02/21/2003 (d) 1,500 1,502 Protective Life Funding Trust 6.088% due 01/17/2003 (d) 2,000 2,003 Qwest Capital Funding, Inc. 6.316% due 07/08/2002 (d) 4,000 4,005 Salomon, Smith Barney Holdings 5.628% due 02/11/2003 (d) 1,200 1,202 Transamerica Finance Corp. 5.192% due 09/17/2001 (d) 1,000 1,000 Wachovia Corp. 6.075% due 05/02/2005 (d) 4,500 4,495 ---------- 111,397 ---------- Industrials 2.0% Coastal Corp. 5.553% due 03/06/2002 (d) 8,100 8,100 Cox Enterprises, Inc. 6.425% due 05/01/2033 (d) 3,500 3,501 Delta Air Lines, Inc. 7.379% due 11/18/2011 2,000 2,121 Northwest Airlines, Inc. 8.072% due 10/01/2019 15,000 16,379 Racers 5.302% due 03/03/2003 (d) 8,200 8,204 6.208% due 04/01/2003 (d) 10,000 9,978 Raytheon Co. 5.738% due 08/10/2001 (d) 800 801 Staples, Inc. 6.195% due 11/26/2001 (d) 9,000 9,011 TCI Communications, Inc. 5.580% due 03/11/2003 (d) 1,000 1,006 Union Pacific Corp. 6.951% due 07/01/2002 (d) 10,000 10,017 ---------- 69,118 ---------- Utilities 2.3% Arizona Public Service Co. 6.108% due 11/15/2001 (d) 2,800 2,803 Burlington Resources, Inc. 8.500% due 10/01/2001 2,895 2,946 Central Power & Light Co. 5.830% due 02/22/2002 (d) 5,000 5,006 Dominion Resources, Inc. 7.600% due 07/15/2003 5,000 5,206 El Paso Energy Corp. 6.328% due 07/15/2001 (d) 8,600 8,605 Entergy Gulf States, Inc. 6.303% due 06/02/2003 (d) 1,100 1,102 Hawaiian Electric Industries, Inc. 6.728% due 04/15/2003 (d) 3,000 3,004 Oneok, Inc. 6.231% due 04/24/2002 (d) 4,000 4,007 Sierra Pacific Resources 6.298% due 04/20/2002 (d) 24,000 20,402 Sprint Capital Corp. 5.410% due 06/10/2002 (d) 1,000 1,002 Texas Utilities Corp. 5.420% due 06/25/2001 (d) 16,400 16,398 5.781% due 09/24/2001 (d) 4,000 3,988 Williams Cos., Inc. 5.888% due 11/15/2001 (d) 5,400 5,408 ---------- 79,877 ---------- Total Corporate Bonds & Notes 260,392 (Cost $263,327) ---------- -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.4% -------------------------------------------------------------------------------- Indiana 0.2% Indiana State Housing Finance Authority Single Family Mortgage Revenue Bonds, Series 2000 7.340% due 07/01/2030 6,825 7,064 ---------- Louisiana 0.2% Louisiana Housing Finance Agency Mortgage Revenue Bonds, (GNMA Insured), Series 2000 7.330% due 12/01/2030 5,000 5,240 ---------- Massachusetts 0.0% Massachussetts State Development Financial Agency Revenue Bonds, (GNMA Insured), Series 2000 9.000% due 06/20/2031 1,900 2,069 ---------- Texas 0.0% Ennis Texas Economic Development Corporate Sales Tax Revenue Bonds, (FGIC Insured), Series 1999 0.000% due 08/01/2034 7,990 742 ---------- Total Municipal Bonds & Notes 15,115 (Cost $14,407) ---------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 1.7% -------------------------------------------------------------------------------- Fannie Mae 7.125% due 06/15/2010 6,100 6,713 Federal Home Loan Bank 6.750% due 08/27/2013 1,000 997 6.500% due 10/07/2013 500 493 6.100% due 10/28/2013 1,000 969 6.320% due 11/05/2013 500 489 6.375% due 11/05/2013 500 491 6.500% due 11/18/2013 500 493 6.500% due 01/06/2014 500 500 6.330% due 01/07/2014 1,000 979 Freddie Mac 6.875% due 09/15/2010 41,200 44,589 SallieMae 5.871% due 10/25/2004 (d) 111 111 Small Business Administration 8.000% due 07/01/2014 3,546 3,761 ---------- Total U.S. Government Agencies 60,585 (Cost $60,270) ---------- PIMCO Funds See accompanying notes 33 Schedule of Investments (Cont.) Mortgage Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 13.6% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (f) 3.625% due 07/15/2002 (b) $ 130,845 $ 133,421 3.375% due 01/15/2007 (h) 116,044 117,313 3.625% due 01/15/2008 (h) 108,384 110,925 4.250% due 01/15/2010 (h) 104,074 111,522 U.S. Treasury Strips 0.000% due 02/15/2015 1,400 642 ---------- Total U.S. Treasury Obligations 473,823 (Cost $468,258) ---------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 137.3% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 41.8% ABN AMRO Mortgage Corp. 6.750% due 09/25/2028 8,142 8,099 6.500% due 06/25/2029 2,100 2,030 Aetna Commercial Trust 7.100% due 12/26/2030 4,000 4,125 Allied Capital Commercial Mortgage Trust 6.310% due 09/25/2003 67 67 American Southwest Financial Securities Corp. 7.248% due 11/25/2038 1,767 1,842 Amortizing Residential Collateral Trust 5.310% due 09/25/2030 (d) 707 708 Banc of America Funding Corp. 6.750% due 11/20/2032 20,000 20,297 Bank of America Mortgage Securities, Inc. 6.250% due 07/25/2014 2,681 2,663 6.650% due 07/25/2028 583 588 6.500% due 05/25/2029 1,000 969 7.750% due 10/25/2030 11,444 11,763 Bayview Financial Revolving Mortgage 6.020% due 08/25/2029 (d) 17,600 17,633 6.350% due 08/25/2029 (d) 4,300 4,337 Bear Stearns Mortgage Securities, Inc. 7.313% due 05/25/2023 (d) 1,827 1,878 6.500% due 12/28/2023 5,200 5,115 7.000% due 08/25/2024 1,000 1,041 7.000% due 01/25/2028 13,886 14,070 7.000% due 02/25/2028 2,500 2,542 6.200% due 03/25/2028 2,500 2,497 7.525% due 06/25/2030 (d) 1,792 1,792 CDC Depositor Trust I 5.593% due 01/15/2003 (d) 2,652 2,642 Cendant Mortgage Corp. 6.750% due 05/18/2012 8,350 8,517 7.250% due 04/18/2013 11,025 11,076 7.250% due 05/18/2013 7,350 7,474 6.500% due 01/15/2016 1,137 1,141 7.500% due 06/18/2030 6,000 6,243 6.030% due 07/25/2030 (d) 6,561 6,561 7.500% due 12/26/2030 18,454 18,286 Chase Commercial Mortgage Securities Corp. 7.600% due 12/18/2005 1,184 1,241 Chase Mortgage Finance Corp. 6.500% due 09/25/2009 1,440 1,437 6.750% due 11/25/2024 1,000 941 6.500% due 07/25/2028 1,080 1,088 6.750% due 07/25/2028 2,000 2,012 6.100% due 02/25/2029 3,211 3,233 7.750% due 04/25/2030 8,875 9,231 Citicorp Mortgage Securities, Inc. 6.000% due 01/25/2009 861 862 6.500% due 02/25/2024 2,295 2,125 6.250% due 04/25/2024 10,567 10,534 6.250% due 08/25/2024 490 468 6.500% due 03/25/2029 2,000 1,944 CMC Securities Corp. III 6.750% due 11/25/2023 1,353 1,356 6.150% due 05/25/2028 1,299 1,297 CMC Securities Corp. IV 7.250% due 11/25/2027 3,446 3,542 Collateralized Mortgage Securities Corp. 10.950% due 02/01/2014 851 852 COMM 5.450% due 10/16/2002 (d) 1,059 1,059 Commercial Mortgage Acceptance Corp. 5.800% due 03/15/2006 217 219 Commercial Mortgage Asset Trust 6.640% due 09/17/2010 3,000 3,078 Countrywide Funding Corp. 6.250% due 02/25/2009 797 795 6.000% due 05/25/2009 1,102 1,102 6.500% due 02/25/2024 8,500 8,349 6.625% due 02/25/2024 7,300 7,333 6.875% due 03/25/2024 2,000 1,994 Countrywide Home Loans 6.500% due 07/25/2013 1,754 1,771 6.750% due 08/25/2028 2,816 2,822 6.000% due 08/25/2029 900 900 Countrywide Mortgage Backed Securities, Inc. 6.750% due 05/25/2024 2,500 2,497 CS First Boston Mortgage Securities Corp. 6.960% due 01/20/2004 3,163 3,230 6.400% due 02/17/2004 1,102 1,125 6.850% due 12/17/2007 22,000 22,506 DLJ Commercial Mortgage Corp. 6.375% due 09/05/2001 (d) 3,500 3,518 DLJ Mortgage Acceptance Corp. 7.580% due 02/12/2006 (d) 4,800 5,083 8.580% due 11/25/2023 (d) 571 581 9.488% due 10/25/2024 (d) 581 617 7.550% due 12/28/2026 (d)(j) 5,228 5,064 6.850% due 12/17/2027 265 274 DVI Business Credit Receivable Corp. III 5.843% due 10/15/2003 (d) 6,150 6,200 Enterprise Mortgage Acceptance Co. 6.110% due 07/15/2003 717 725 Fairfax Funding Trust 6.483% due 04/02/2013 250 255 Fannie Mae 6.000% due 11/25/2006 79 79 6.270% due 09/25/2007 3,000 3,049 6.500% due 05/25/2008 500 512 6.000% due 12/25/2008 30 30 4.000% due 02/25/2009 777 740 6.500% due 02/25/2009 1,397 1,405 6.000% due 03/25/2009 304 291 6.250% due 12/25/2013 14,142 13,973 6.600% due 09/25/2018 138 138 6.500% due 04/25/2019 1,395 1,399 9.000% due 06/25/2020 3,109 3,306 6.350% due 06/25/2020 1,000 1,004 6.500% due 09/25/2020 676 676 9.500% due 11/25/2020 9,286 9,993 6.500% due 05/25/2021 237 240 6.100% due 08/25/2021 3,261 3,264 6.500% due 04/25/2022 184 184 7.000% due 10/25/2022 1,241 1,257 7.800% due 10/25/2022 814 849 7.500% due 03/25/2023 1,859 1,951 5.000% due 04/25/2023 230 199 6.500% due 05/25/2023 2,500 2,494 6.000% due 08/25/2023 1,528 1,390 6.500% due 09/18/2023 3,040 3,072 7.500% due 09/20/2023 1,551 1,566 7.000% due 09/25/2023 1,688 1,712 5.612% due 09/25/2023 (d) 8,469 8,446 7.000% due 09/25/2023 3,376 3,300 7.000% due 10/25/2023 142 141 7.000% due 12/25/2023 2,636 2,655 5.000% due 01/25/2024 4 4 6.500% due 01/25/2024 1,695 1,607 6.500% due 02/25/2024 2,583 2,493 7.000% due 04/25/2024 2,431 2,440 6.600% due 05/18/2025 1,256 1,283 7.500% due 11/17/2025 968 1,006 34 PIMCO Funds See accompanying notes Principal Amount Value (000s) (000s) 7.500% due 11/20/2026 $ 8,719 $ 9,069 7.000% due 11/25/2026 2,722 2,694 7.000% due 12/25/2026 1,353 1,339 7.500% due 04/18/2027 2,353 2,411 7.000% due 12/20/2027 2,509 2,511 6.500% due 04/18/2028 461 465 6.500% due 05/18/2028 3,624 3,452 6.500% due 06/25/2028 6,000 5,655 6.000% due 07/18/2028 6,956 6,073 6.500% due 10/25/2028 3,528 3,315 5.000% due 11/25/2028 271 172 6.290% due 02/25/2029 1,500 1,426 7.500% due 02/25/2030 1,091 1,124 5.500% due 10/25/2030 (d) 2,617 2,622 8.915% due 06/25/2032 4,103 4,316 6.500% due 12/17/2035 14,859 14,071 6.390% due 05/25/2036 2,358 2,183 7.410% due 01/17/2037 200 204 6.500% due 06/17/2038 1,000 1,007 6.500% due 09/17/2038 5,723 5,434 7.386% due 01/17/2040 (d) 4,331 4,213 FDIC Remic Trust 6.750% due 05/25/2026 68 69 Federal Agricultural Mortgage Corp. 8.314% due 04/25/2030 8,033 8,605 FFCA Secured Lending Corp. 7.130% due 02/18/2009 409 421 7.270% due 02/18/2011 9,614 9,996 7.850% due 10/18/2017 16,900 17,580 7.770% due 02/18/2019 20,000 20,856 8.970% due 06/18/2020 4,000 4,178 First Boston Mortgage Securities Corp. 6.750% due 09/25/2006 1,257 1,291 First Horizon Asset Securities 7.500% due 12/25/2030 5,588 5,718 First Nationwide Trust 8.000% due 10/25/2030 2,279 2,297 Freddie Mac 8.000% due 01/01/2005 49 49 8.000% due 09/15/2006 628 628 8.000% due 03/01/2009 46 46 7.000% due 10/01/2014 1 1 6.500% due 10/15/2016 695 697 6.250% due 01/15/2017 348 349 5.800% due 06/15/2019 363 362 6.300% due 10/15/2019 1,029 1,031 7.000% due 10/15/2020 8,582 8,687 9.000% due 12/15/2020 308 325 9.500% due 12/15/2020 3,042 3,228 6.250% due 01/15/2021 313 315 9.000% due 02/15/2021 4,395 4,618 6.000% due 04/15/2021 8,132 8,147 9.500% due 07/15/2021 869 887 7.000% due 10/15/2021 132 132 6.000% due 10/15/2022 450 454 6.500% due 12/17/2022 793 797 7.500% due 03/15/2023 1,819 1,895 7.000% due 05/15/2023 316 317 7.000% due 07/15/2023 3,507 3,533 7.500% due 07/15/2023 2,281 2,374 6.250% due 09/15/2023 6,065 5,828 6.500% due 11/25/2023 3,217 3,056 6.000% due 12/15/2023 417 389 6.500% due 01/15/2024 1,436 1,356 6.800% due 02/15/2024 1,428 1,367 6.500% due 03/15/2024 1,574 1,535 6.250% due 07/15/2024 2,255 2,234 8.500% due 03/15/2025 2,261 2,449 7.000% due 01/01/2026 222 226 7.000% due 04/15/2026 2,819 2,828 6.250% due 11/15/2026 2,200 2,179 6.500% due 06/15/2027 1,000 1,002 6.500% due 01/15/2028 2,456 2,362 5.663% due 02/15/2028 (d) 4,746 4,736 6.500% due 04/15/2028 10,094 9,458 6.000% due 05/15/2028 3,200 2,962 6.500% due 06/15/2028 2,988 2,805 6.500% due 08/15/2028 946 889 6.500% due 10/15/2028 2,321 2,270 6.000% due 11/25/2028 575 477 6.000% due 12/15/2028 4,000 3,563 6.250% due 12/15/2028 2,081 1,910 6.000% due 02/15/2029 2,266 1,933 6.500% due 03/15/2029 5,546 5,315 7.000% due 09/17/2031 4,752 4,963 6.947% due 08/15/2032 (d) 10,518 10,779 General Electric Capital Mortgage Services, Inc. 7.000% due 11/25/2007 2,040 2,099 6.500% due 09/25/2023 1,000 933 6.500% due 11/25/2023 17,000 16,985 7.500% due 03/25/2027 2,800 2,876 7.000% due 10/25/2027 10,562 10,604 7.000% due 11/25/2027 15,143 15,401 6.500% due 05/25/2029 900 873 6.750% due 08/25/2029 3,893 3,916 7.750% due 04/25/2030 2,000 2,080 GMAC Commercial Mortgage Securities, Inc. 5.457% due 02/20/2003 (d) 859 860 5.387% due 09/20/2005 (d) 4,200 4,201 6.411% due 11/15/2007 1,074 1,096 7.151% due 02/15/2008 (d) 14,278 15,072 6.420% due 08/15/2008 589 598 6.570% due 09/15/2033 585 601 Golden Mortgage Loan 7.875% due 02/25/2031 9,696 9,838 Government Lease Trust 4.000% due 05/18/2011 6,300 5,084 Government National Mortgage Association 5.650% due 10/20/2018 689 689 7.250% due 12/16/2023 5,144 5,235 7.000% due 07/16/2026 1,369 1,382 7.500% due 09/16/2027 5,066 5,058 6.500% due 09/20/2028 2,352 2,205 6.500% due 01/20/2029 3,452 3,193 6.250% due 03/16/2029 2,500 2,284 6.500% due 03/20/2029 2,400 2,314 6.500% due 04/20/2029 4,812 4,467 7.500% due 08/20/2029 4,503 4,664 6.500% due 08/20/2029 14,732 13,967 8.000% due 11/16/2029 3,337 3,701 8.000% due 01/16/2030 2,195 2,345 7.000% due 01/16/2030 2,115 2,095 5.650% due 02/16/2030 (d) 1,930 1,940 7.500% due 02/20/2030 2,000 2,071 8.000% due 03/20/2030 2,000 2,063 5.600% due 10/16/2030 (d) 4,063 4,064 Guardian Savings & Loan Association 8.233% due 07/25/2019 (d) 77 79 Headlands Mortgage Securities, Inc. 7.155% due 12/25/2012 1,029 1,045 Hilton Hotel Pool Trust 7.055% due 10/03/2010 16,605 17,391 5.692% due 10/03/2010 (d) 40,000 39,913 5.792% due 10/03/2010 (d) 15,000 15,000 Host Marriott Pool Trust 7.970% due 08/03/2009 16,990 18,231 Housing Securities, Inc. 6.000% due 02/25/2008 38 38 6.500% due 07/25/2009 442 450 Independent National Mortgage Corp. 9.329% due 01/25/2025 (d) 150 153 J.P. Morgan Commercial Mortgage Finance Corp. 5.443% due 04/15/2010 (d) 1,459 1,459 LB Mortgage Trust 8.396% due 01/20/2017 (d) 3,799 4,185 LTC Commercial Mortgage 6.029% due 05/28/2030 1,471 1,501 Mellon Residential Funding Corp. 5.652% due 06/26/2028 1,727 1,723 6.460% due 07/25/2029 (d) 578 579 2001 Annual Report See accompanying notes 35 Schedule of Investments (Cont.) Mortgage Portfolio March 31, 2001 Principal Amount Value (000s) (000s) Merrill Lynch Mortgage Investors, Inc. 6.050% due 10/15/2008 $ 3,035 $ 3,048 7.070% due 12/26/2025 300 313 6.950% due 06/18/2029 2,850 2,935 6.220% due 02/15/2030 1,471 1,507 Morgan Stanley Capital I 6.440% due 11/15/2002 80 81 5.990% due 05/15/2005 203 206 6.860% due 07/15/2005 3,690 3,846 7.258% due 01/16/2006 2,025 2,128 6.860% due 05/15/2006 (d) 2,037 2,102 6.190% due 01/15/2007 3,551 3,614 7.460% due 02/15/2020 4,972 5,222 NationsBanc Montgomery Funding Corp. 6.500% due 07/25/2028 3,000 2,956 Nationslink Funding Corp. 6.654% due 02/10/2006 26,000 26,826 7.181% due 12/20/2006 23,298 24,563 5.583% due 04/10/2007 (d) 2,641 2,642 Nomura Depositor Trust 5.443% due 01/15/2003 (d) 197 197 Norwest Asset Securities Corp. 6.250% due 06/25/2014 3,408 3,389 7.500% due 03/25/2027 770 771 7.250% due 10/25/2027 8,400 8,640 6.250% due 08/25/2028 1,253 1,257 6.200% due 09/25/2028 140 140 6.750% due 10/25/2028 8,663 8,638 6.250% due 12/25/2028 2,000 1,924 6.500% due 01/25/2029 6,500 6,426 6.100% due 02/25/2029 5,209 5,198 6.250% due 05/25/2029 500 460 6.000% due 07/25/2029 5,600 5,504 6.500% due 10/25/2029 985 952 7.250% due 02/25/2030 3,257 3,278 Norwest Integrated Structured Assets, Inc. 7.000% due 06/25/2028 3,000 3,042 7.000% due 09/25/2029 2,808 2,827 Paine Webber Mortgage Acceptance Corp. 6.500% due 06/25/2008 1,000 1,010 6.750% due 04/25/2024 751 696 PHH Mortgage Services Corp. 7.182% due 11/18/2027 1,896 1,901 PNC Mortgage Securities Corp. 7.000% due 12/25/2027 5,190 5,278 6.625% due 03/25/2028 1,476 1,486 6.750% due 10/25/2028 7,289 7,056 6.750% due 04/25/2029 200 198 6.500% due 06/25/2029 4,380 3,960 6.750% due 08/25/2029 2,475 2,498 7.250% due 10/25/2029 2,493 2,563 6.212% due 12/25/2030 (d) 49,356 49,629 Principal Residential Mortgage 7.230% due 06/20/2005 (d) 5,000 5,010 Prudential Home Mortgage Securities 7.000% due 01/25/2008 400 406 6.750% due 11/25/2008 1,182 1,190 6.000% due 02/25/2009 20,952 20,217 6.600% due 08/25/2023 1,889 1,896 6.500% due 01/25/2024 1,788 1,692 6.800% due 05/25/2024 3,996 3,868 7.500% due 08/25/2024 8,259 8,451 Prudential Securities Secured Financing Corp. 6.105% due 11/15/2002 68 68 7.000% due 09/25/2020 1,423 1,434 Residential Accredit Loans, Inc. 7.750% due 04/25/2027 599 599 7.250% due 06/25/2027 4,700 4,793 6.750% due 06/25/2029 3,000 2,986 7.750% due 10/25/2029 3,767 3,867 7.750% due 03/25/2030 2,457 2,487 Residential Asset Securitization Trust 6.500% due 09/25/2014 3,845 3,869 6.750% due 03/25/2028 441 439 6.750% due 04/25/2028 284 284 6.250% due 11/25/2028 4,000 3,882 Residential Funding Mortgage Securities I 6.981% due 06/25/2008 2,800 2,830 6.478% due 10/25/2008 2,042 2,053 7.000% due 05/25/2012 2,687 2,776 6.500% due 12/25/2012 9,055 9,051 6.500% due 04/25/2013 2,863 2,895 6.250% due 03/25/2014 913 910 6.200% due 11/25/2023 50 50 6.500% due 12/25/2023 8,604 8,374 9.226% due 03/25/2025 (d) 765 793 7.000% due 03/25/2026 4,592 4,676 7.000% due 11/25/2027 7,600 7,717 7.000% due 12/25/2027 2,888 2,928 6.750% due 03/25/2028 2,000 1,994 6.750% due 05/25/2028 2,170 2,171 6.750% due 06/25/2028 2,903 2,910 6.250% due 11/25/2028 6,000 5,756 6.500% due 01/25/2029 19,000 18,460 6.500% due 03/25/2029 5,000 4,861 6.500% due 04/25/2029 4,200 4,063 7.500% due 02/25/2030 3,000 3,089 8.000% due 04/25/2030 7,989 8,102 7.750% due 09/25/2030 4,780 4,908 Residential Mortgage Securities 5.610% due 02/09/2020 (d) 4,591 4,591 5.760% due 02/09/2028 (d) 25,000 25,000 Resolution Trust Corp. 7.530% due 08/25/2023 (d) 1,718 1,738 8.177% due 01/25/2025 (d) 47 47 8.000% due 06/25/2026 1,685 1,696 RMF Commercial Mortgage Securities, Inc. 6.715% due 01/15/2019 (d) 1,400 1,438 7.100% due 11/28/2027 (d) 1,746 1,785 Saco I, Inc. 5.480% due 09/25/2040 (d) 400 400 Salomon Brothers Mortgage Securities VII 8.571% due 11/25/2022 (d) 306 309 5.430% due 05/25/2029 (d) 3,267 3,278 5.350% due 06/25/2029 (d) 1,291 1,290 Sasco Floating Rate Commercial Mortgage Trust 5.407% due 11/20/2001 (d) 2,578 2,580 5.600% due 03/25/2002 (d) 3,646 3,646 6.457% due 07/22/2002 (d) 4,286 4,262 5.600% due 04/25/2003 (d) 1,000 995 Securitized Asset Sales, Inc. 6.250% due 12/25/2023 221 220 8.469% due 12/26/2023 (d) 119 124 7.000% due 07/25/2024 289 289 7.410% due 09/25/2024 (d) 2,000 2,036 Security Pacific National Bank 7.338% due 09/25/2019 (d) 408 409 Starwood Asset Receivables Trust 5.830% due 08/25/2003 (d) 1,447 1,447 6.530% due 01/25/2004 (d) 19,000 19,086 6.030% due 09/25/2022 (d) 40,000 40,109 Starwood Commercial Mortgage Trust 6.600% due 02/03/2009 3,652 3,767 6.920% due 02/03/2009 1,000 1,015 Structured Asset Mortgage Investments, Inc. 7.347% due 05/25/2022 (d) 14,216 13,892 6.901% due 06/25/2028 (d) 12,010 12,520 7.230% due 02/25/2030 (d) 5,611 5,757 Structured Asset Notes Transactions Ltd. 6.650% due 08/30/2005 (d) 818 812 Structured Asset Securities Corp. 7.375% due 09/25/2024 1,040 1,045 7.000% due 12/25/2027 4,300 4,357 6.750% due 07/25/2029 2,403 2,427 6.280% due 02/25/2030 (d) 4,459 4,469 TMA Mortgage Funding Trust 5.430% due 01/25/2029 (d) 4,209 4,209 36 PIMCO Funds See accompanying notes Principal Amount Value (000s) (000s) Union Planters Mortgage Finance Corp. 6.350% due 01/25/2028 $ 302 $ 302 6.600% due 01/25/2028 4,000 4,048 Vendee Mortgage Trust 7.750% due 05/15/2022 6,417 6,756 6.500% due 03/15/2029 2,500 2,430 Washington Mutual, Inc. 7.500% due 11/19/2029 2,000 2,073 ---------- 1,454,881 ---------- Fannie Mae 9.4% 5.500% due 12/01/2028-05/01/2029 (g) 1,172 1,114 6.000% due 04/01/2004-04/16/2031 (g) 44,293 43,233 6.130% due 08/01/2005 2,968 3,029 6.250% due 07/01/2003 56 56 6.262% due 02/01/2009 4,814 4,836 6.450% due 09/01/2016 3,900 3,972 6.500% due 09/01/2005-05/14/2031 (g) 126,506 125,988 6.750% due 11/01/2007 62 63 6.761% due 01/01/2027 (d) 1,526 1,569 6.981% due 06/01/2007 1,113 1,170 7.000% due 06/01/2003-05/14/2031 (g) 8,370 8,484 7.032% due 01/01/2030 (d) 11,941 12,378 7.040% due 03/01/2007 216 229 7.052% due 08/01/2009 1,777 1,867 7.060% due 11/01/2003 278 287 7.235% due 10/01/2003 235 243 7.241% due 02/01/2018 (d) 1,598 1,573 7.250% due 01/01/2003-10/01/2011 (g) 313 319 7.310% due 07/01/2003 235 243 7.382% due 05/01/2030 (d) 18,807 19,705 7.430% due 01/25/2023 3,479 3,476 7.447% due 03/01/2030 (d) 15,965 16,764 7.500% due 10/01/2028-04/16/2031 (g) 56,711 58,027 7.750% due 02/01/2008 135 138 8.000% due 07/01/2007-12/01/2016 (g) 385 398 8.078% due 03/01/2024 (d) 191 197 8.214% due 07/01/2024 (d) 483 497 8.224% due 12/01/2024 (d) 687 707 8.235% due 11/01/2025 (d) 925 950 8.250% due 12/01/2022 (d) 196 201 8.342% due 02/01/2027 (d) 921 938 8.348% due 11/01/2025 (d) 986 1,006 8.367% due 11/01/2023 (d) 157 161 8.451% due 05/01/2026 (d) 391 400 8.472% due 01/01/2024 (d) 105 109 8.500% due 04/01/2008-08/01/2030 (d)(g) 5,968 6,239 8.750% due 04/01/2018 30 31 8.752% due 02/01/2024 (d) 380 395 9.000% due 03/01/2010-06/01/2027 (g) 3,436 3,633 9.250% due 05/01/2010 78 82 9.500% due 09/01/2010-04/01/2025 (g) 783 838 10.000% due 04/01/2020 423 462 15.500% due 10/01/2012 6 7 15.750% due 12/01/2011 3 3 ---------- 326,017 ---------- Federal Housing Administration 3.0% 6.875% due 12/01/2016 702 680 6.896% due 07/01/2020 849 817 7.430% due 07/01/2018-07/01/2025 (g) 69,892 69,631 7.450% due 05/01/2021 1,211 1,203 7.500% due 12/01/2030-09/01/2034 (g) 3,666 3,694 7.510% due 05/01/2040 2,500 2,577 7.590% due 12/01/2017 3,874 3,928 7.625% due 12/01/2016 452 461 7.630% due 09/01/2039 7,054 7,279 7.750% due 01/01/2016-05/01/2028 (g) 1,323 1,349 8.250% due 05/01/2022-04/01/2028 (g) 3,535 3,602 8.530% due 02/01/2039 3,234 3,478 8.875% due 06/01/2035 5,895 6,245 ---------- 104,944 ---------- Freddie Mac 14.7% 5.500% due 04/16/2031 5,600 5,330 6.000% due 09/01/2006-04/16/2031 (g) 32,360 31,611 6.250% due 04/01/2003 72 72 6.379% due 01/01/2028 (d) 1,523 1,562 6.500% due 03/01/2005-05/14/2031 (g) 62,149 61,821 6.698% due 09/01/2028 (d) 906 926 6.742% due 09/01/2027 (d) 2,402 2,455 6.771% due 12/01/2029 (d) 9,423 9,665 6.775% due 11/01/2003 161 159 6.861% due 10/01/2027 (d) 1,006 1,032 6.905% due 07/01/2027 (d) 2,248 2,306 6.962% due 12/01/2026 (d) 1,227 1,261 7.000% due 09/01/2006-05/14/2031 (g) 270,994 274,127 7.011% due 11/01/2027 (d) 2,603 2,668 7.219% due 07/01/2028 (d) 14,255 14,604 7.400% due 02/01/2021 2,517 2,504 7.450% due 03/25/2022 2,350 2,346 7.500% due 07/01/2009-04/16/2031 (g) 49,258 50,389 7.732% due 11/01/2029 (d) 25,669 26,069 7.738% due 03/01/2029 (d) 1,580 1,637 7.950% due 03/31/2030 4,647 4,758 8.000% due 05/01/2008-11/01/2013 (g) 734 761 8.207% due 03/01/2027 (d) 458 471 8.242% due 10/01/2024 (d) 1,112 1,134 8.250% due 06/01/2008-12/01/2008 (g) 313 324 8.253% due 10/01/2024 (d) 734 752 8.346% due 06/01/2022 (d) 50 51 8.362% due 06/01/2024 (d) 329 338 8.368% due 10/01/2023 (d) 790 806 8.370% due 02/01/2027 (d) 3,302 3,397 8.394% due 09/01/2026 (d) 2,597 2,670 8.500% due 05/01/2001-08/01/2027 (g) 1,752 1,838 9.500% due 12/01/2001-07/01/2004 (g) 335 346 10.000% due 07/01/2005-12/01/2005 (g) 271 277 10.250% due 05/01/2009 2 3 10.750% due 09/01/2009-05/01/2010 (g) 12 13 ---------- 510,483 ---------- Government National Mortgage Association 68.0% 5.500% due 04/20/2030-05/20/2030 (d)(g) 2,855 2,871 6.000% due 12/15/2023-04/23/2031 (d)(g) 14,279 14,040 6.500% due 09/15/2023-05/21/2031 (d)(g) 243,025 244,002 6.670% due 08/15/2040 2,879 2,838 6.720% due 09/15/2001-11/15/2040 (g) 2,334 2,319 7.000% due 04/20/2017-05/21/2031 (d)(g) 585,720 593,616 7.250% due 07/15/2040 11,436 11,627 7.375% due 03/20/2021-05/20/2028 (d)(g) 48,804 49,536 7.500% due 03/15/2001-11/30/2039 (d)(g) 825,356 845,419 7.625% due 12/20/2018-10/20/2027 (d)(g) 52,352 53,672 7.700% due 06/15/2001 1,562 1,651 7.750% due 07/20/2020-09/20/2027 (d)(g) 36,775 37,667 8.000% due 09/15/2005-05/21/2031 (d)(g) 92,410 95,371 8.250% due 07/15/2008 189 196 8.500% due 01/15/2028-04/23/2031 (g) 382,268 396,787 9.000% due 09/15/2006-08/20/2030 (g) 10,785 11,245 9.500% due 09/15/2009-12/15/2021 (g) 867 938 11.000% due 07/15/2010 19 21 ---------- 2,363,816 ---------- Stripped Mortgage-Backed Securities 0.4% Bear Stearns Mortgage Securities, Inc. (IO) 7.000% due 08/25/2024 270 22 Chase Mortgage Finance Corp. (PO) 0.000% due 01/25/2030 114 71 CMC Securities Corp. III (IO) 6.750% due 11/25/2028 4,364 499 Collateralized Mortgage Obligation Trust (PO) 0.000% due 09/23/2017 41 35 Fannie Mae (IO) 727.220% due 09/25/2006 6 25 6.500% due 02/25/2007 270 10 7.000% due 04/25/2008 631 73 6.000% due 07/25/2008 29 0 7.000% due 04/25/2019 2,521 103 6.500% due 05/25/2019 2,748 156 7.000% due 08/25/2019 393 20 6.500% due 03/25/2020 650 36 6.500% due 08/25/2020 120 7 2001 Annual Report See accompanying notes 37 Schedule of Investments (Cont.) Mortgage Portfolio March 31, 2001 Principal Amount Value (000s) (000s) 839.670% due 08/25/2020 $ 1 $ 24 6.500% due 09/25/2021 509 47 6.500% due 03/25/2022 1,948 170 Fannie Mae (PO) 0.000% due 06/25/2022 10 10 0.000% due 08/25/2022 230 195 0.000% due 04/25/2023 4,360 2,209 First Union National Bank-Bank of America Commercial Mortgage Trust (IO) 2.002% due 03/15/2011 38,977 4,467 Freddie Mac (IO) 6.500% due 07/15/2006 225 8 1088.100% due 03/15/2007 2 12 6.500% due 05/15/2007 169 9 6.500% due 07/15/2007 307 9 1170.442% due 07/15/2018 3 15 7.000% due 08/15/2018 1,164 45 6.500% due 01/15/2023 1,321 169 7.000% due 10/25/2023 1,423 263 1.487% due 12/15/2023 (d) 1,930 92 7.500% due 08/15/2029 854 165 Government National Mortgage Association (PO) 0.000% due 02/26/2019 624 602 Merrill Lynch Mortgage Investors, Inc. (IO) 1.000% due 04/25/2028 (d) 32,189 740 Residential Funding Mortgage Securities I (IO) 7.000% due 09/25/2023 461 43 Residential Funding Mortgage Securities II (IO) 10.000% due 09/25/2003 13,600 3,041 ---------- 13,392 ---------- Total Mortgage-Backed Securities 4,773,533 (Cost $4,670,793) ---------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 38.0% -------------------------------------------------------------------------------- Aames Mortgage Trust 5.563% due 07/15/2029 (d)(i) 4,867 4,887 5.613% due 10/15/2029 (d) 1,705 1,708 ABFS Equipment Contract Trust 6.100% due 10/15/2005 130 128 ABSC Long Beach Home Equity Loan Trust 6.675% due 06/21/2030 (d) 14,287 14,342 6.175% due 07/21/2030 (d) 24,000 24,129 Access Financial Manufactured Housing Contract Trust 7.650% due 05/15/2021 1,500 1,348 Ace Securities Corp. 5.370% due 11/25/2028 (d) 648 649 Advanta Business Card Master Trust 5.707% due 04/20/2008 (d) 17,000 17,233 6.457% due 04/20/2008 (d) 20,700 21,020 Advanta Mortgage Loan Trust 6.012% due 05/25/2027 (d) 1,671 1,670 5.425% due 11/25/2029 (d) 824 825 8.250% due 08/25/2030 10,000 10,524 Aerco Ltd. 6.028% due 07/15/2025 (d) 3,400 3,405 AFC Home Equity Loan Trust 5.460% due 06/24/2029 (d) 7,098 7,129 5.780% due 06/24/2029 (d) 1,814 1,815 5.600% due 12/26/2029 (d) 1,023 1,023 Alliance Laundry Equipment Receivables Trust 5.968% due 05/15/2009 (d) 8,635 8,635 American Residential Eagle Trust 5.880% due 04/25/2029 (d) 875 881 Americredit Automobile Receivable Trust 5.304% due 10/12/2002 865 866 5.442% due 09/05/2006 (d) 1,000 1,003 Argentina Funding Corp. 5.267% due 05/20/2003 (d) 1,000 1,002 Associates Manufactured Housing 7.000% due 03/15/2027 29 30 Banc One Auto Grantor Trust 6.290% due 07/20/2004 1,341 1,351 Banc One Home Equity Trust 6.460% due 06/25/2029 134 134 Bayview Financial Acquisition Trust 5.600% due 02/25/2029 (d) 1,846 1,855 6.130% due 11/25/2029 (d) 957 957 5.910% due 02/25/2030 (d) 29,538 29,547 5.700% due 02/25/2030 (d) 19,516 19,407 6.200% due 07/25/2030 (d) 22,811 22,769 6.380% due 07/25/2030 (d) 6,805 6,805 5.800% due 11/25/2030 (d) 18,000 18,000 7.300% due 11/25/2030 (d) 10,000 10,000 Block Mortgage Finance, Inc. 7.049% due 04/25/2014 (d) 1,706 1,713 7.122% due 08/25/2022 326 325 5.710% due 08/25/2028 (d) 942 941 5.970% due 12/25/2028 (d) 2,300 2,304 Capital Asset Research Funding LP 6.400% due 12/15/2004 1,428 1,430 5.905% due 12/15/2005 3,412 3,411 Captec Franchise Trust 7.892% due 10/15/2010 5,533 5,761 Centex Home Equity 7.540% due 10/25/2030 29,000 30,006 7.990% due 10/25/2030 14,840 15,528 Centrex Auto Trust 6.150% due 09/15/2004 1,018 1,021 Chase Funding Mortgage Loan Asset-Backed Certificates 5.600% due 10/25/2030 (d) 15,000 15,012 6.850% due 10/25/2030 (d) 18,800 18,630 Chase Manhattan Grantor Trust 6.610% due 09/15/2002 152 152 Chevy Chase Auto Receivables Trust 6.200% due 03/20/2004 715 720 CIT Equipment Collateral 7.520% due 07/20/2011 4,835 4,892 CNH Equipment Trust 7.140% due 09/15/2007 1,150 1,187 CNL Funding 7.721% due 08/25/2009 22,836 24,008 Conseco Finance 7.880% due 08/20/2005 12,967 13,296 8.560% due 07/20/2008 19,091 19,589 6.940% due 11/15/2014 814 822 10.550% due 09/15/2020 14,140 15,225 8.410% due 12/15/2025 9,000 9,479 5.553% due 12/15/2029 (d) 1,340 1,345 5.913% due 03/15/2030 (d) 11,900 11,896 5.583% due 10/15/2030 (d) 2,085 2,083 6.068% due 02/15/2031 (d) 1,000 980 8.200% due 02/01/2032 40,000 41,784 10.210% due 02/01/2032 700 728 Conseco Finance Securitizations Corp. 8.850% due 12/01/2030 22,995 25,812 7.970% due 05/01/2032 13,800 14,531 8.310% due 05/01/2032 23,000 24,848 Contimortgage Home Equity Loan Trust 5.870% due 09/15/2008 652 659 6.420% due 04/25/2014 192 191 6.770% due 01/25/2018 2,000 2,025 5.303% due 06/15/2028 (d) 1,231 1,228 5.778% due 08/15/2028 (d) 149 149 5.818% due 09/15/2028 (d) 900 898 Countrywide Asset-Backed Certifications 7.480% due 12/25/2031 (d) 6,732 6,706 Countrywide Home Loans 6.030% due 12/25/2030 (d) 16,322 16,366 Cross Country Master Credit Card Trust II 5.663% due 06/15/2006 (d) 1,900 1,916 CS First Boston Mortgage Securities Corp. 7.590% due 07/25/2026 8,700 9,067 5.813% due 12/15/2030 (d) 13,050 13,125 6.233% due 12/15/2030 (d) 37,550 38,038 Delta Funding Home Equity Loan Trust 5.573% due 09/15/2029 (d) 771 775 Denver Arena Trust 6.940% due 11/15/2019 14,526 13,961 38 PIMCO Funds See accompanying notes Principal Amount Value (000s) (000s) Embarcadero Aircraft Securitization Trust 5.643% due 08/15/2025 (d) $ 15,000 $ 15,000 6.263% due 08/15/2025 (d) 9,612 9,612 5.643% due 08/15/2025 (d) 4,708 4,708 EQCC Home Equity Loan Trust 6.050% due 02/25/2010 1,269 1,268 5.770% due 05/20/2010 227 227 5.323% due 10/15/2027 (d) 687 686 Fifth Third Auto Grantor Trust 6.450% due 03/15/2002 14 14 Fingerhut Master Trust 6.682% due 02/15/2005 (d) 12,400 12,373 6.113% due 02/15/2007 (d) 8,600 8,522 First International Bank 9.118% due 03/15/2027 (d) 24,738 24,738 First Plus Home Loan Trust 6.870% due 08/10/2014 2,986 3,001 6.350% due 03/10/2017 1,800 1,823 6.490% due 07/10/2017 1,500 1,509 First USA Credit Card Master Trust 5.476% due 02/18/2004 (d) 3,500 3,493 Fleet Credit Card Master Trust II 6.038% due 05/15/2008 (d) 29,500 29,500 FMAC Loan Receivables Trust 6.729% due 12/15/2019 2,700 2,671 6.111% due 12/15/2019 1,225 1,236 Ford Credit Auto Owner Trust 5.810% due 03/15/2002 243 243 General Electric Capital Mortgage Services, Inc. 6.380% due 05/25/2014 222 222 7.200% due 04/25/2029 3,308 3,171 GMAC Mortgage Corp. Loan Trust 7.950% due 03/25/2030 3,928 3,996 7.720% due 12/25/2031 7,574 7,796 Government Lease Trust 5.860% due 04/18/2003 1,368 1,379 Government National Mortgage Association 5.597% due 06/20/2032 (d) 5,000 5,018 7.930% due 06/20/2032 10,000 10,468 Green Tree Financial Corp. 6.600% due 01/15/2019 2,194 2,230 9.100% due 04/15/2025 9,960 10,289 8.400% due 06/15/2025 82 83 7.230% due 03/15/2028 3,500 3,363 6.420% due 11/15/2028 786 791 7.550% due 01/15/2029 649 653 6.650% due 02/15/2029 1,847 1,873 7.690% due 09/01/2030 11,500 10,865 6.920% due 12/01/2030 5,000 4,830 7.060% due 02/01/2031 2,500 2,390 6.970% due 04/01/2031 7,000 7,247 7.860% due 04/01/2031 1,900 1,945 Green Tree Floorplan Receivables Master Trust 5.537% due 11/15/2004 (d) 3,500 3,501 Green Tree Home Equity Loan Trust 7.180% due 07/15/2030 7,925 8,208 6.770% due 07/15/2030 300 308 6.290% due 09/15/2030 1,936 1,941 7.610% due 09/15/2030 8,000 8,383 Green Tree Home Improvement Loan Trust 5.333% due 08/15/2029 (d) 1,168 1,166 5.960% due 08/15/2029 166 166 5.383% due 11/15/2029 (d) 562 563 Green Tree Recreational, Equipment, & Consumables 6.430% due 04/17/2006 1,357 1,369 6.715% due 02/01/2009 1,362 1,382 Greenpoint Manufactured Housing 6.750% due 04/15/2011 6,905 6,944 GRMT II LLC 5.257% due 06/20/2032 (d)(i) 3,018 3,013 IMC Home Equity Loan Trust 7.110% due 08/25/2014 2,679 2,704 6.410% due 04/20/2018 853 858 6.880% due 11/20/2028 9,568 9,816 IMPAC Secured Assets CMN Owner Trust 7.770% due 07/25/2025 6,000 6,138 Indymac Home Equity Loan Asset-Backed Trust 8.980% due 12/25/2031 1,000 1,023 6.126% due 12/25/2031 (d) 7,925 7,986 5.726% due 12/25/2031 (d) 5,400 5,434 Irwin Home Equity 5.420% due 02/25/2012 (d) 1,430 1,434 7.960% due 05/25/2012 7,000 7,302 5.950% due 06/25/2021 (d) 4,000 4,037 Long Beach Acceptance Auto Grantor Trust 6.190% due 01/25/2004 682 684 MBNA Master Credit Card Trust 6.350% due 11/15/2005 800 811 Mellon Auto Grantor Trust 5.460% due 10/17/2005 1,217 1,226 Metris Master Trust 5.657% due 04/20/2006 (d) 3,200 3,223 Metropolitan Asset Funding, Inc. 6.173% due 04/25/2029 (d) 1,694 1,671 Mid-State Trust 8.330% due 04/01/2030 4,653 5,017 7.791% due 03/15/2038 1,845 1,932 MLCC Mortgage Investors, Inc. 5.543% due 03/15/2025 (d) 2,182 2,190 Morgan Stanley Dean Witter Capital I 7.500% due 07/15/2010 26,147 27,609 7.730% due 03/15/2016 (d) 12,000 12,699 New York City Tax Lien 6.460% due 05/25/2005 24 24 6.650% due 05/25/2005 (i) 9 9 Nextcard Credit Card Master Note Trust 6.810% due 12/15/2006 (d) 5,300 5,300 NPF XII, Inc. 6.045% due 10/01/2003 (d) 35,000 35,000 6.345% due 10/01/2003 (d) 1,700 1,700 6.006% due 03/01/2004 (d) 4,000 4,000 Oakwood Mortgage Investors, Inc. 7.500% due 01/15/2021 1,000 1,035 7.100% due 10/15/2026 130 130 6.650% due 05/15/2027 522 523 10.383% due 03/15/2031 (d) 3,781 3,781 Ocwen Mortgage Loan 5.872% due 10/25/2029 (d) 2,356 2,361 6.210% due 03/25/2031 (d) 9,677 9,758 Onyx Acceptance Grantor Trust 6.300% due 05/15/2004 2,166 2,178 Option One Mortgage Loan Trust 6.250% due 02/25/2029 (d) 5,972 6,004 6.020% due 05/25/2029 600 605 5.430% due 12/26/2029 (d) 1,340 1,345 Origen Manufactured Housing 7.650% due 03/15/2032 (i) 13,200 13,264 PacificAmerica Home Equity Loan 5.700% due 06/26/2028 (d) 1,682 1,677 Pegasus Aviation Lease Securitization 6.155% due 03/25/2015 (d) 27,268 27,276 PP&L Transition Bond Co. LLC 6.410% due 12/26/2003 1,588 1,597 Provident Bank Home Equity Loan Trust 5.270% due 04/25/2029 (d) 940 936 Residential Asset Mortgage Products, Inc. 8.360% due 06/25/2030 21,228 22,400 8.000% due 09/25/2030 24,150 25,236 Residential Asset Securities Corp. 5.670% due 12/25/2013 (d) 1 1 7.615% due 12/25/2014 3,793 3,827 7.998% due 09/25/2021 (d) 1,067 1,099 Residential Funding Mortgage Securities II 7.850% due 12/25/2024 (i) 7,000 7,210 7.980% due 09/25/2030 (i) 15,999 16,544 Residential Mortgage Loan Trust 6.312% due 09/25/2029 (d)(i) 4,856 4,913 2001 Annual Report See accompanying notes 39 Schedule of Investments (Cont.) Mortgage Portfolio March 31, 2001 Principal Amount Value (000s) (000s) Ryder Vehicle Lease Trust 6.430% due 01/15/2003 $ 4,267 $ 4,274 SallieMae 5.936% due 04/25/2004 (d) 579 580 5.841% due 07/25/2004 (d) 1,790 1,786 6.122% due 07/25/2016 (d) 17,907 17,937 5.880% due 10/27/2025 (d) 1,963 1,939 Salomon Brothers Mortgage Securities VII 5.762% due 09/25/2027 (d)(i) 2,625 2,633 6.930% due 08/25/2028 2,572 2,561 5.400% due 07/25/2029 (d)(i) 1,093 1,094 5.450% due 09/25/2029 (d)(i) 660 663 5.743% due 11/15/2029 (d)(i) 2,000 2,006 6.663% due 11/15/2029 (d)(i) 17,600 17,925 5.390% due 12/25/2029 (d)(i) 2,990 2,998 Saxon Asset Securities Trust 7.585% due 12/25/2014 845 851 5.830% due 02/25/2029 (d)(i) 266 267 5.760% due 05/25/2029 (d) 1,268 1,269 Sears Credit Account Master Trust 7.000% due 10/15/2004 8 8 5.693% due 10/18/2011 (d) 30,500 30,418 Southern Pacific Secured Assets Corp. 5.700% due 07/25/2029 (d) 1,762 1,757 The Money Store Home Equity Trust 7.550% due 02/15/2020 704 709 7.600% due 07/15/2021 1,108 1,120 6.345% due 11/15/2021 239 240 6.490% due 10/15/2026 6,027 6,109 5.313% due 08/15/2029 (d) 662 660 TrendWest Resorts, Inc. 7.440% due 12/15/2011 14,322 14,401 7.780% due 12/15/2011 4,842 4,967 8.670% due 12/15/2011 4,919 5,057 UCFC Manufactured Housing Contract 7.900% due 01/15/2028 1,500 848 United Panama Mortgage Loan 5.370% due 04/25/2030 (d)(i) 2,957 2,964 Vanderbilt Mortgage Finance 7.905% due 02/07/2026 198 211 8.040% due 12/07/2030 1,023 1,052 WFS Financial Owner Trust 6.411% due 07/20/2002 1,270 1,272 6.920% due 01/20/2004 800 815 WMC Mortgage Loan 5.177% due 06/20/2028 (d) 148 148 ---------- Total Asset-Backed Securities 1,320,883 (Cost $1,291,433) ---------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 0.9% -------------------------------------------------------------------------------- Industrial 0.9% Nabors Industries, Inc. 0.000% due 06/20/2020 46,000 32,545 ---------- Total Convertible Bonds & Notes 32,545 (Cost $29,883) ---------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 1.9% -------------------------------------------------------------------------------- Commercial Paper 1.6% Freddie Mac 5.070% due 04/03/2001 28,200 28,196 General Electric Capital Corp. 5.120% due 04/03/2001 15,500 15,498 Swedbank, Inc. 4.900% due 08/23/2001 4,300 4,218 Williams Cos., Inc. 7.231% due 04/10/2001 6,200 6,202 ---------- 54,114 ---------- U.S. Treasury Bills 0.3% 5.015% due 05/17/2001 (b) 10,460 10,394 ---------- Total Short-Term Instruments 64,508 (Cost $64,504) ---------- Total Investments (a) 201.3% $7,001,384 (Cost $6,862,875) Other Assets and Liabilities (Net) (101.3%) (3,524,106) ---------- Net Assets 100.0% $3,477,278 ---------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $6,862,960 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 145,968 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (7,544) ---------- Unrealized appreciation-net $ 138,424 ---------- (b) Securities with an aggregate market value of $8,687 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 10 Year Note (06/2001) 103 $ (25) -------------- 40 PIMCO Funds See accompanying notes (c) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 3-month LIBOR plus 0.500% and pay a fixed rate equal to 7.600%. Broker: Lehman Brothers Exp. 07/15/2003 $ 5,000 $ (235) Receive floating rate based on 3-month LIBOR plus 1.000% and pay to the counterparty the notional amount of $15,000 in exchange for shares of Nabors Industries, Inc. due 6/20/2020 when the convertible debentures mature. Broker: Morgan Stanley Exp. 06/20/2003 9,126 (347) Receive floating rate based on 3-month LIBOR plus 1.100% and pay a fixed rate equal to 0.000% prior to Option Exercise Date and 2.500% after Option Exercise Date. Broker: Bear Stearns Exp. 06/20/2003 20,321 (801) Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 06/15/2006 26,300 591 Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 06/15/2006 361,600 (179) Receive fixed rate equal to 6.000% and pay floating rate based on 3-month LIBOR. Broker: Bank of America Exp. 06/15/2011 108,000 (846) ----------- $ (1,817) ----------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Reverse repurchase agreements were entered into on various days paying various interest rates. The following securities were segregated with collateral for reverse repurchase agreements: Type Maturity Value -------------------------------------------------------------------------------- Entered into on March 26, 2001 paying interest at 4.875% Fannie Mae 7.027% 01/01/2030 $ 12,378 Fannie Mae 7.382% 05/01/2030 19,705 Fannie Mae 7.458% 03/01/2030 16,764 Freddie Mac 6.831% 12/01/2029 9,665 Freddie Mac 7.480% 07/01/2028 14,604 Government National Mortgage Assn. 6.500% 06/20/2030 12,037 Government National Mortgage Assn. 6.500% 04/20/2030 60,518 Government National Mortgage Assn. 6.500% 05/20/2030 41,969 Government National Mortgage Assn. 7.000% 04/20/2030 12,554 Government National Mortgage Assn. 7.000% 06/20/2030 56,830 Government National Mortgage Assn. 7.000% 07/20/2030 127,459 Government National Mortgage Assn. 7.000% 05/20/2030 27,468 Government National Mortgage Assn. 7.375% 05/20/2026 12,647 Government National Mortgage Assn. 7.500% 08/20/2030 19,905 Government National Mortgage Assn. 7.500% 11/20/2029 9,217 Government National Mortgage Assn. 7.500% 07/20/2030 6,131 Government National Mortgage Assn. 7.625% 10/20/2023 12,172 Government National Mortgage Assn. 7.625% 10/20/2024 12,882 Government National Mortgage Assn. 7.750% 08/20/2023 15,345 Entered into on March 27, 2001 paying interest at 5.000% Bear Stearns Mortgage Securities Inc. 7.000% 01/25/2028 14,072 Centex Home Equity 7.540% 10/25/2030 30,006 Centex Home Equity 7.990% 10/25/2030 15,528 Countrywide Home Loans 6.030% 12/25/2030 16,366 Fannie Mae 6.250% 12/25/2013 13,974 GE Capital Mtg Services, Inc. 6.500% 11/25/2023 16,985 Government National Mortgage Assn. 6.500% 08/20/2029 13,967 Morgan Stanley Dean Witter Capital 7.500% 07/15/2010 27,609 Nationslink Funding Corporaton 6.654% 02/10/2006 26,827 Nationslink Funding Corporaton 7.181% 12/20/2006 24,563 Pegasus Aviation Lease Securitization 6.115% 03/25/2015 27,276 Residential Funding Mortgage Securities 7.980% 09/25/2030 16,544 Entered into on March 30, 2001 paying interest at 4.990% Fannie Mae 7.910% 11/01/2029 26,069 Entered into on March 30, 2001 paying interest at 5.030% PNC Mortgage Securities Corp. 6.213% 12/25/2030 49,629 ---------- $ 819,665 ----------- (f) Principal amount of the security is adjusted for inflation. (g) Securities are grouped by coupon or range of coupons and represent a range of maturities. (h) Subject to financing transaction. (i) Security becomes interest bearing at a future date. (j) Restricted security. (k) Security is in default. 2001 Annual Report See accompanying notes 41 Schedule of Investments Asset-Backed Securities Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 40.8% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 7.0% Asset Securitization Corp. 7.378% due 08/13/2029 $ 750 $ 800 Bear Stearns Mortgage Securities, Inc. 7.750% due 06/25/2027 932 938 Residential Asset Securities Corp. 6.750% due 07/25/2029 14 13 Starwood Asset Receivables Trust 6.050% due 01/25/2004 (b) 1,000 1,005 Starwood Commercial Mortgage Trust 6.920% due 02/03/2009 1,000 1,015 ---------- 3,771 ---------- Fannie Mae 13.1% 6.160% due 06/01/2008 1,000 1,010 6.930% due 10/01/2021 1,000 988 7.000% due 05/14/2031 5,000 5,053 ---------- 7,051 ---------- Government National Mortgage Association 17.0% 7.000% due 04/23/2031 7,000 7,109 7.500% due 04/23/2031 1,000 1,025 8.000% due 05/21/2031 1,000 1,032 ---------- 9,166 ---------- Stripped Mortgage-Backed Securities 3.7% Residential Funding Mortgage Securities II (IO) 10.000% due 09/25/2003 9,000 2,013 ---------- Total Mortgage-Backed Securities 22,001 (Cost $21,858) ---------- -------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 88.3% -------------------------------------------------------------------------------- ABSC Long Beach Home Equity Loan Trust 6.675% due 06/21/2030 (b) 1,000 1,004 Access Financial Manufactured Housing Contract Trust 7.650% due 05/15/2021 1,000 898 Advanta Business Card Master Trust 6.457% due 04/20/2008 (b) 1,200 1,219 ANRC Auto Owner Trust 6.940% due 04/17/2006 440 456 Bayview Financial Acquisition Trust 6.280% due 11/25/2030 (b) 1,000 1,000 Capital Asset Research Funding LP 6.400% due 12/15/2004 2,595 2,598 Chase Funding Mortgage Loan Asset-Backed Certificates 6.850% due 10/25/2030 (b) 2,000 1,982 CNH Equipment Trust 7.140% due 09/15/2007 1,061 1,096 Conseco Finance 7.670% due 02/15/2016 500 515 7.800% due 05/15/2020 150 157 8.410% due 12/15/2025 2,000 2,107 9.290% due 12/15/2029 1,000 1,058 6.318% due 03/15/2030 (b) 1,000 1,000 10.210% due 02/01/2032 1,000 1,039 Conseco Finance Securitizations Corp. 8.310% due 05/01/2032 2,115 2,285 Contimortgage Home Equity Loan Trust 7.280% due 04/25/2014 1,000 1,030 Denver Arena Trust 6.940% due 11/15/2019 906 871 Embarcadero Aircraft Securitization Trust 6.980% due 08/15/2025 (b) 1,250 1,249 Fingerhut Master Trust 5.963% due 02/15/2005 (b) 700 698 6.518% due 02/15/2007 (b) 700 694 First International Bank 9.118% due 03/15/2027 (b) 990 990 Fleet Credit Card Master Trust II 6.443% due 05/15/2008 (b) 1,000 1,000 Fleetwood Credit Corp. 6.550% due 05/15/2011 822 834 General Electric Capital Mortgage Services, Inc. 7.200% due 04/25/2029 973 933 Green Tree Financial Corp. 7.230% due 03/15/2028 500 480 7.550% due 01/15/2029 649 652 6.920% due 12/01/2030 1,000 966 7.060% due 02/01/2031 1,000 956 7.860% due 04/01/2031 500 512 Green Tree Home Equity Loan Trust 7.650% due 04/15/2027 290 298 HFC Revolving Home Equity Loan 5.830% due 08/20/2016 (b) 155 155 IMPAC Secured Assets CMN Owner Trust 7.770% due 07/25/2025 1,000 1,023 Indymac Home Equity Loan Asset-Backed Trust 7.006% due 12/25/2031 (b) 1,500 1,501 Irwin Home Equity 7.960% due 05/25/2012 2,000 2,086 Keystone Owner Trust 8.500% due 01/25/2029 1,000 954 Long Beach Acceptance Auto Grantor Trust 6.190% due 01/25/2004 76 76 MBNA Master Credit Card Trust 6.350% due 11/15/2005 1,200 1,216 Nextcard Credit Card Master Note Trust 6.810% due 12/15/2006 (b) 700 700 NPF XII, Inc. 6.006% due 03/01/2004 (b) 2,000 2,000 Oakwood Mortgage Investors, Inc. 10.383% due 03/15/2031 (b) 500 500 Origen Manufactured Housing 7.650% due 03/15/2032 2,000 2,010 Residential Asset Mortgage Products, Inc. 8.360% due 06/25/2030 1,500 1,583 UCFC Home Equity Loan 5.865% due 10/15/2028 (b) 265 264 UCFC Manufactured Housing Contract 7.900% due 01/15/2028 1,000 565 Vanderbilt Mortgage Finance 7.900% due 02/07/2026 1,200 1,278 8.040% due 12/07/2030 1,000 1,028 ---------- Total Asset-Backed Securities 47,516 (Cost $46,194) ---------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 1.4% -------------------------------------------------------------------------------- Commercial Paper 1.1% General Electric Capital Corp. 5.410% due 04/03/2001 600 600 ---------- Repurchase Agreement 0.3% State Street Bank 4.600% due 04/02/2001 137 137 (Dated 03/30/2001. Collateralized by Freddie Mac 5.300% due 09/12/2003 valued at $141. Repurchase proceeds are $137.) ---------- Total Short-Term Instruments 737 (Cost $737) ---------- Total Investments (a) 130.5% $ 70,254 (Cost $68,789) Other Assets and Liabilities (Net) (30.5%) (16,432) ---------- Net Assets 100.0% $ 53,822 ---------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $68,783 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 1,492 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (21) ---------- Unrealized appreciation-net $ 1,471 ---------- (b) Variable rate security. The rate listed is as of March 31, 2001. 42 PIMCO Funds See accompanying notes Schedule of Investments Real Return Bond Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- CORPORATE BONDS & NOTES 24.4% -------------------------------------------------------------------------------- Banking & Finance 17.4% Allstate Financial Global Funding 7.125% due 09/26/2005 $ 2,500 $ 2,633 Associates Corp. of North America 5.660% due 05/08/2003 (d) 500 501 Atlas Reinsurance PLC 9.071% due 04/04/2003 (d) 740 740 Countrywide Home Loans 5.036% due 03/22/2002 (d) 4,000 3,999 Dime Bancorp, Inc. 7.000% due 07/25/2001 5,400 5,413 First Union Corp. 7.550% due 08/18/2005 2,500 2,652 Ford Motor Credit Co. 5.190% due 06/20/2003 (d) 3,500 3,497 6.850% due 08/27/2006 (d) 1,000 1,000 General Motors Acceptance Corp. 7.035% due 07/21/2003 (d) 3,000 3,004 MBNA Corp. 5.435% due 12/10/2002 (d) 500 492 Morgan Stanley, Dean Witter & Co. 5.722% due 01/28/2002 (d) 1,000 1,002 National Australia Bank Ltd. 7.315% due 05/19/2010 (d) 200 201 National Rural Utilities Cooperative Finance Corp. 5.721% due 08/13/2002 (d) 2,000 2,000 Prudential Funding Corp. 6.375% due 07/23/2006 1,000 1,013 Qwest Capital Funding, Inc. 6.316% due 07/08/2002 (d) 3,000 3,004 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 5,299 5,328 ---------- 36,479 ---------- Industrials 1.3% Enron Corp. 5.510% due 09/10/2001 (d) 500 500 Fred Meyer, Inc. 7.375% due 03/01/2005 1,000 1,048 Petroleos Mexicanos 9.500% due 09/15/2027 600 629 Waste Management, Inc. 7.100% due 08/01/2026 500 507 ---------- 2,684 ---------- Utilities 5.7% Appalachian Power Co. 5.360% due 06/27/2001 (d) 1,000 1,000 British Telecommunications PLC 6.078% due 12/15/2003 (d) 3,600 3,601 Commonwealth Edison Co. 6.901% due 09/30/2002 (d) 1,000 1,001 Entergy Gulf States, Inc. 6.303% due 06/02/2003 (d) 500 501 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(i) 3,000 2,475 Scana Corp. 6.328% due 07/15/2002 (d) 700 701 Southern California Edison Co. 7.725% due 05/01/2002 (d) 2,000 1,630 Sprint Capital Corp. 6.927% due 06/10/2002 (d) 250 250 Vodafone Group PLC 5.080% due 12/19/2001 (d) 250 250 WorldCom, Inc. 6.920% due 11/26/2001 (d) 500 499 ---------- 11,908 ---------- Total Corporate Bonds & Notes 51,071 (Cost $51,361) ---------- -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 0.8% -------------------------------------------------------------------------------- Florida 0.8% Tampa, Florida Guaranteed Entitlement Revenue (AMPAC Insured) 6.000% due 10/01/2004 $ 1,515 $ 1,630 ---------- Total Municipal Bonds & Notes 1,630 (Cost $1,574) ---------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 127.6% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities (f) 3.625% due 07/15/2002 (e) 51,167 52,175 3.375% due 01/15/2007 48,799 49,333 3.625% due 01/15/2008 (e) 59,655 61,053 3.875% due 01/15/2009 45,734 47,564 3.625% due 04/15/2028 17,354 17,696 3.875% due 04/15/2029 36,161 38,602 ---------- Total U.S. Treasury Obligations 266,423 (Cost $258,635) ---------- -------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 3.9% -------------------------------------------------------------------------------- Collateralized Mortgage Obligations 3.7% Bear Stearns Adjustable Rate Mortgage Trust 7.638% due 11/25/2030 (d) 4,754 4,775 Freddie Mac 7.000% due 10/15/2030 2,000 2,046 GMAC Commercial Mortgage Asset Corp. 5.307% due 06/01/2005 (d) 987 987 ---------- 7,808 ---------- Fannie Mae 0.2% 8.068% due 09/01/2018 (d) 352 360 ---------- Total Mortgage-Backed Securities 8,168 (Cost $8,105) ---------- -------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES 0.5% -------------------------------------------------------------------------------- Industrial 0.5% Waste Management, Inc. 4.000% due 02/01/2002 1,000 970 ---------- Total Convertible Bonds & Notes 970 (Cost $961) ---------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 12.2% -------------------------------------------------------------------------------- Commercial Paper 11.3% Fannie Mae 4.700% due 05/16/2001 300 298 4.685% due 09/06/2001 1,600 1,567 Federal Farm Credit Bank 4.630% due 08/29/2001 1,100 1,078 General Electric Capital Corp. 4.990% due 04/03/2001 4,000 3,999 4.900% due 04/25/2001 4,800 4,786 Halifax PLC 5.010% due 08/08/2001 300 295 5.080% due 08/08/2001 200 197 National Rural Utilities Cooperative Finance Corp. 5.180% due 05/24/2001 500 496 Reseau Ferre De France 4.590% due 07/25/2001 2,500 2,461 SBC Communications, Inc. 5.330% due 04/04/2001 500 500 Swedbank, Inc. 4.930% due 04/25/2001 2,000 1,992 5.060% due 08/08/2001 100 98 4.890% due 08/08/2001 2,000 1,965 UBS Finance, Inc. 5.830% due 06/06/2001 100 99 5.040% due 08/02/2001 1,500 1,475 5.070% due 08/08/2001 400 393 4.820% due 08/15/2001 2,000 1,964 ---------- 23,663 ---------- 2001 Annual Report See accompanying notes 43 Schedule of Investments (Cont.) Real Return Bond Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- Repurchase Agreement 0.8% State Street Bank 4.600% due 04/02/2001 $ 1,663 $ 1,663 (Dated 03/30/2001. Collateralized by ---------- Freddie Mac 6.680% due 12/28/2001 valued at $1,696. Repurchase proceeds are $1,664.) U.S. Treasury Bills 0.1% 2.986% due 05/17/2001 (b)(c) 270 268 ---------- Total Short-Term Instruments 25,594 (Cost $25,596) ---------- Total Investments (a) 169.4% $ 353,856 (Cost $346,232) Other Assets and Liabilities (Net) (69.4%) (145,024) ---------- Net Assets 100.0% $ 208,832 ---------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $346,301 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 8,467 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (912) ---------- Unrealized appreciation-net $ 7,555 ---------- (b) Securities with an aggregate market value of $268 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- U.S. Treasury 5 Year Note (06/2001) 25 $ (20) 10 Year Agency June Futures (06/2001) 64 11 United Kingdom 90 Day LIBOR Futures (09/2002) 12 (0) -------------- $ (9) -------------- (c) Securities are grouped by coupon or range of coupons and represent a range of maturities. (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Subject to financing transaction. (f) Principal amount of the security is adjusted for inflation. (g) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Covered by Settlement Unrealized Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy N$ 81 04/2001 $ (1) -------------- (h) Principal amount denoted in indicated currency: N$ - New Zealand Dollar (i) Security is in default. 44 PIMCO Funds See accompanying notes Schedule of Investments International Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- AUSTRALIA (e)(f) 0.6% -------------------------------------------------------------------------------- General Motors Acceptance Corp. 4.849% due 03/25/2002 (d) EC 14,300 $ 12,548 National Australia Bank Ltd. 6.035% due 05/19/2010 (d) $ 310 312 Registered Australian Mortgage Securities 5.138% due 09/26/2032 (d) EC 4,171 3,669 Torrens Trust 5.424% due 07/15/2031 (d) $ 5,471 5,471 ---------- Total Australia 22,000 (Cost $23,920) ---------- -------------------------------------------------------------------------------- AUSTRIA (e)(f) 0.4% -------------------------------------------------------------------------------- Republic of Austria 5.500% due 01/15/2010 EC 17,720 16,142 ---------- Total Austria 16,142 (Cost $15,414) ---------- -------------------------------------------------------------------------------- BELGIUM (e)(f) 0.2% -------------------------------------------------------------------------------- Kingdom of Belgium 7.500% due 07/29/2008 (j) EC 6,600 6,707 ---------- Total Belgium 6,707 (Cost $7,102) ---------- -------------------------------------------------------------------------------- CANADA (e) 0.1% -------------------------------------------------------------------------------- Beneficial Canada, Inc. 6.350% due 04/01/2002 C$ 4,070 2,616 ---------- Total Canada 2,616 (Cost $2,815) ---------- -------------------------------------------------------------------------------- CAYMAN ISLANDS (e)(f) 0.4% -------------------------------------------------------------------------------- International Credit Recovery-Japan 0.746% due 08/25/2005 (d) EC 110,000 876 0.863% due 08/25/2005 515,011 4,103 MBNA American Euro 4.887% due 05/19/2004 (d) 10,600 9,312 ---------- Total Cayman Islands 14,291 (Cost $16,949) ---------- -------------------------------------------------------------------------------- CROATIA (e)(f) 0.0% -------------------------------------------------------------------------------- Republic of Croatia 7.000% due 03/28/2005 EC 1,840 1,664 ---------- Total Croatia 1,664 (Cost $1,766) ---------- -------------------------------------------------------------------------------- DENMARK (e)(f) 0.0% -------------------------------------------------------------------------------- BG Bank 6.272% due 11/24/2007 (d) EC 1,200 1,090 ---------- Total Denmark 1,090 (Cost $1,135) ---------- -------------------------------------------------------------------------------- FRANCE (e)(f) 3.3% -------------------------------------------------------------------------------- Axa 2.500% due 01/01/2014 EC 1,385 1,207 Compagnie Financiere de CIC-UE 6.379% due 10/29/2049 (d) $ 3,700 3,608 Republic of France 4.000% due 04/25/2009 EC 56,780 47,654 3.000% due 07/25/2009 3,809 3,247 4.000% due 10/25/2009 (j) 73,390 60,700 5.500% due 04/25/2010 3,030 2,803 ---------- Total France 119,219 (Cost $122,187) ---------- -------------------------------------------------------------------------------- GERMANY (e)(f) 47.7% -------------------------------------------------------------------------------- Depfa Pfandbriefbank 4.750% due 07/15/2008 EC 1,990 $ 1,722 5.750% due 03/04/2009 2,020 1,856 5.250% due 07/15/2011 (j) 17,500 15,402 Hypothekenbank in Essen AG 5.500% due 02/20/2007 35,590 32,251 Landesbank Baden-Wuerttemberg AG 5.500% due 04/02/2007 47,620 43,262 Republic of Germany 4.125% due 07/04/2008 (j) 156,160 133,459 4.500% due 07/04/2009 (j) 726,830 630,253 5.375% due 01/04/2010 (j) 441,810 409,573 5.250% due 07/04/2010 357,500 327,845 5.250% due 01/04/2011 100,170 91,846 6.500% due 07/04/2027 (j) 3,330 3,367 Rheinische Hypothekenbank AG 4.250% due 09/24/2008 13,780 11,502 WestDeutsche Landersbank 4.750% due 09/28/2007 8,880 7,741 ---------- Total Germany 1,710,079 (Cost $1,784,796) ---------- -------------------------------------------------------------------------------- GREECE(e)(f) 0.8% -------------------------------------------------------------------------------- Hellenic Finance 2.000% due 07/15/2003 EC 2,400 2,114 Hellenic Republic 6.938% due 06/06/2001 (d) $ 16,300 16,322 7.850% due 05/19/2003 (d) GD 3,228 2,922 7.890% due 06/17/2003 (d) 4,730 4,309 7.080% due 10/23/2003 (d) 2,085 1,924 ---------- Total Greece 27,591 (Cost $31,919) ---------- -------------------------------------------------------------------------------- ITALY (e)(f) 6.3% -------------------------------------------------------------------------------- Finmeccanica SpA 2.000% due 06/08/2005 EC 2,687 2,292 First Italian Auto Transaction 5.139% due 07/01/2008 (d) 30,000 26,402 International Credit Recovery 5.602% due 03/15/2010 (d) 4,400 3,874 Island Finance 5.404% due 03/30/2015 (d) 8,556 7,561 Republic of Italy 5.750% due 09/15/2002 (j) 29,900 26,820 4.750% due 07/01/2005 (j) 26,970 23,882 7.750% due 11/01/2006 (j) 19,400 19,529 4.500% due 05/01/2009 (j) 91,390 77,823 4.250% due 11/01/2009 10,580 8,827 5.500% due 11/01/2010 (j) 31,690 28,728 ---------- Total Italy 225,738 (Cost $228,785) ---------- -------------------------------------------------------------------------------- JAPAN (e)(f) 0.2% -------------------------------------------------------------------------------- Government of Japan 0.900% due 12/22/2008 (d) JY 175,000 1,385 Government of Japan Ten-Year Bond 2.600% due 03/20/2007 (j) 276,000 2,440 SHL Corp.Ltd. 1.331% due 12/25/2024 (d) 152,000 1,211 1.031% due 12/25/2024 (d) 180,459 1,438 ---------- Total Japan 6,474 (Cost $6,906) ---------- -------------------------------------------------------------------------------- MEXICO (e)(f) 0.3% -------------------------------------------------------------------------------- United Mexican States 5.000% due 09/30/2002 JY1,194,000 9,885 ---------- Total Mexico 9,885 (Cost $11,662) ---------- 2001 Annual Report See accompanying notes 45 Schedule of Investments (Cont.) International Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- NETHERLANDS (e)(f) 0.9% -------------------------------------------------------------------------------- Koninklijke Ahold NV 5.013% due 06/13/2001 (d) EC 14,000 $ 12,310 4.000% due 05/19/2005 $ 1,000 1,048 Unilever NV 4.830% due 09/17/2001 (d) EC 19,750 17,296 ---------- Total Netherlands 30,654 (Cost $29,985) ---------- -------------------------------------------------------------------------------- NEW ZEALAND (e)(f) 0.6% -------------------------------------------------------------------------------- Commonwealth of New Zealand 4.500% due 02/15/2016 N$ 52,110 23,091 ---------- Total New Zealand 23,091 (Cost $31,304) ---------- -------------------------------------------------------------------------------- POLAND (e) 0.6% -------------------------------------------------------------------------------- Republic of Poland 6.000% due 07/18/2001 PZ 88,000 20,492 ---------- Total Poland 20,492 (Cost $19,501) ---------- -------------------------------------------------------------------------------- SOUTH KOREA (e)(f) 1.8% -------------------------------------------------------------------------------- Export-Import Bank Korea 5.078% due 03/20/2002 (d) DM 4,900 2,183 Hansol Paper Co. Ltd. 8.943% due 05/24/2001 (d) $ 2,000 2,020 KBC Bank Fund Trust IV 8.220% due 11/29/2049 EC 3,130 2,896 Korea Development Bank 4.885% due 05/14/2001 (d) DM 5,430 2,441 2.770% due 05/21/2001 JY1,400,000 11,187 2.450% due 09/10/2001 1,280,000 10,239 1.875% due 02/13/2002 2,561,000 20,475 2.700% due 08/16/2002 1,007,000 8,079 4.700% due 03/18/2004 780,000 6,771 ---------- Total South Korea 66,291 (Cost $72,416) ---------- -------------------------------------------------------------------------------- SPAIN (e)(f) 1.7% -------------------------------------------------------------------------------- Kingdom of Spain 4.950% due 07/30/2005 EC 25,030 22,374 5.150% due 07/30/2009 42,400 37,970 ---------- Total Spain 60,344 (Cost $62,096) ---------- -------------------------------------------------------------------------------- SUPRANATIONAL (e)(f) 0.3% -------------------------------------------------------------------------------- European Investment Bank 5.500% due 12/07/2009 BP 2,300 3,296 International Bank for Reconstruction & Development 7.250% due 04/09/2001 N$ 22,372 9,023 ---------- Total Supranational 12,319 (Cost $14,876) ---------- -------------------------------------------------------------------------------- TUNISIA (e)(f) 0.1% -------------------------------------------------------------------------------- Banque Centrale De Tunisie 7.500% due 08/06/2009 EC 2,800 2,552 ---------- Total Tunisia 2,552 (Cost $2,847) ---------- -------------------------------------------------------------------------------- UNITED KINGDOM (e)(f) 3.2% -------------------------------------------------------------------------------- Abbey National Treasury Service PLC 7.625% due 12/30/2002 BP 5,270 7,745 BG Transco Holdings PLC 7.057% due 12/14/2009 (d) 5,230 7,394 British Telecom PLC 4.804% due 07/27/2001 (d) EC 26,500 23,299 4.992% due 09/25/2001 (d) 3,500 3,076 Core 4.903% due 01/16/2006 (d) DM 3,046 $ 1,355 Halifax Group Euro Finance 7.627% due 12/29/2049 EC 6,000 5,568 Haus Ltd. 5.076% due 12/10/2037 10,600 9,331 5.124% due 12/10/2037 (d) 12,800 11,266 Holmes 5.166% due 12/15/2025 12,624 11,106 Holmes Financing PLC 5.859% due 07/15/2017 (d) $ 2,860 2,861 Lehman Brothers Holdings, Inc. 5.403% due 06/23/2004 (d) EC 3,000 2,642 Lloyds TSB Bank PLC 7.000% due 11/29/2049 (d) $ 1,100 887 Lloyds TSB Capital 7.375% due 02/07/2049 (d) EC 9,250 8,543 SCCR Series 1 Ltd. 6.504% due 04/15/2032 (d) BP 154 218 5.373% due 12/15/2031 (d) 7,096 6,256 United Kingdom Gilt 5.750% due 12/07/2009 (j) 9,730 14,694 ---------- Total United Kingdom 116,241 (Cost $121,603) ---------- -------------------------------------------------------------------------------- UNITED STATES (e)(f) 69.3% -------------------------------------------------------------------------------- Asset-Backed Securities 5.7% Advanta Mortgage Loan Trust 5.425% due 11/25/2029 (d) $ 2,472 2,474 AESOP Funding II LLC 5.830% due 11/20/2006 (d) 11,200 11,141 AFC Home Equity Loan Trust 5.270% due 03/25/2027 (d) 2,690 2,691 Amresco Residential Securities Mortgage Loan Trust 6.000% due 06/25/2029 (d) 7,526 7,555 Argentina Funding Corp. 5.840% due 05/20/2003 (d) 2,000 2,005 Banc One Auto Grantor Trust 6.270% due 11/20/2003 140 141 Banc One Home Equity Trust 6.460% due 06/25/2029 156 155 Bayview Financial Acquisition Trust 5.920% due 11/25/2030 (d) 10,100 10,100 Champion Home Equity Loan Trust 8.033% due 02/25/2028 (d) 2,194 2,239 Charter Financial, Inc. 6.590% due 02/25/2002 1,292 1,295 Chase Manhattan Grantor Trust 6.610% due 09/15/2002 51 52 Conseco Finance 6.273% due 12/15/2029 (d) 335 335 5.534% due 12/15/2029 (d) 2,262 2,270 Contimortgage Home Equity Loan Trust 6.420% due 04/25/2014 174 174 CS First Boston Mortgage Securities Corp. 5.424% due 12/15/2030 (d) 9,605 9,615 Duck Auto Grantor Trust 6.760% due 04/15/2005 22,370 22,758 GMAC Mortgage Corp. Loan Trust 5.256% due 11/18/2015 (d) 7,421 7,427 Green Tree Financial Corp. 6.800% due 10/15/2027 341 342 Green Tree Home Equity Loan Trust 6.290% due 09/15/2030 830 832 Long Beach Mortgage Loan Trust 5.240% due 01/21/2031 (d) 19,634 19,652 Metris Master Trust 5.658% due 04/20/2006 (d) 2,500 2,518 MLCC Mortgage Investors, Inc. 5.949% due 03/15/2025 (d) 11,126 11,169 Nissan Auto Receivables Grantor Trust 5.450% due 04/15/2004 433 434 46 PIMCO Funds See accompanying notes Principal Amount Value (000s) (000s) Novastar Home Equity Loan 5.325% due 04/25/2028 (d) $ 13,158 $ 13,001 Provident Bank Equipment Lease Trust 5.830% due 11/25/2011 (d) 10,566 10,566 Providian Gateway Master Trust 5.380% due 03/15/2007 (d) 15,600 15,600 Providian Home Equity Loan Trust 5.340% due 06/25/2025 (d) 1,432 1,434 PSB Lending Home Loan Owner Trust 6.830% due 05/20/2018 402 405 Residential Asset Securities Corp. 5.770% due 12/25/2031 (d) 1,168 1,170 SallieMae 5.979% due 10/25/2004 (d) 656 656 7.024% due 04/25/2007 (d) 1,146 1,146 6.780% due 10/25/2007 (d) 4,400 4,392 Salomon Brothers Mortgage Securities VII 5.390% due 02/25/2030 (d) 15,342 15,382 5.584% due 11/15/2029 (d) 9,378 9,418 Sovereign Bank Home Equity Loan 7.260% due 02/25/2015 1,908 1,926 United Panama Mortgage Loan Asset Backed 5.500% due 10/25/2029 (d) 10,973 10,977 ---------- 203,447 ---------- Corporate Bonds & Notes 14.9% Associates Corp. of North America 5.660% due 05/08/2003 (d) 3,720 3,726 Associates First Capital Corp. 5.810% due 01/25/2031 (d) 22,546 22,546 AT&T Capital Corp. 5.881% due 04/23/2002 (d) 4,500 4,511 Bank of America Corp. 5.975% due 08/01/2002 (d) 3,000 3,001 Bear Stearns Co., Inc. 5.640% due 05/07/2002 (d) 600 600 6.125% due 02/01/2003 1,129 1,139 5.210% due 03/28/2003 (d) 7,170 7,168 CIT Group, Inc. 5.190% due 09/13/2002 (d) 3,000 2,991 Coastal Corp. 5.554% due 03/06/2002 (d) 10,000 10,000 DaimlerChrysler North America Holding Corp. 5.790% due 12/16/2002 (d) 4,600 4,581 5.720% due 08/16/2004 (d) 1,600 1,560 7.250% due 01/18/2006 3,190 3,274 Donaldson, Lufkin & Jenrette, Inc. 6.023% due 04/25/2003 (d) 4,140 4,142 6.259% due 07/18/2003 (d) 40,600 40,721 DQE Capital Corp. 6.179% due 01/15/2002 (d) 1,400 1,401 Enron Corp. 5.510% due 09/10/2001 (d) 3,500 3,503 Finova Capital Corp. 6.040% due 11/08/2002 (d) 5,260 4,319 6.316% due 04/08/2003 (d) 2,900 2,378 Ford Motor Credit Co. 5.030% due 07/13/2001 (d) 13,312 13,309 6.093% due 03/19/2002 (d) 7,100 7,085 5.939% due 07/16/2002 (d) 600 600 5.133% due 03/17/2003 (d) 7,100 7,047 5.323% due 06/02/2003 (d) 2,030 2,027 6.826% due 06/20/2003 (d) 10,000 9,991 1.000% due 12/22/2003 JY 44,000 351 6.089% due 07/19/2004 (d) $ 23,500 23,345 1.200% due 02/07/2005 JY 458,000 3,644 5.353% due 06/30/2005 (d) $ 7,900 7,808 5.400% due 08/27/2006 (d) 7,900 7,900 General Motors Acceptance Corp. 5.723% due 04/29/2002 (d) 900 901 0.299% due 07/26/2002 (d) JY 341,000 2,699 5.548% due 02/14/2003 (d) $ 7,000 6,974 5.750% due 03/22/2004 (d) 900 900 6.536% due 04/05/2004 (d) 36,460 35,940 6.536% due 04/05/2004 (d) 1,160 1,143 5.999% due 07/21/2004 (d) 14,100 13,973 6.875% due 09/09/2004 BP 6,650 9,836 5.500% due 02/20/2005 EC 16,900 14,941 Gold Eagle Capital Ltd. 8.629% due 06/15/2001 (d) $ 7,000 7,002 Goldman Sachs Group, Inc. 5.350% due 12/07/2001 (d) 10,000 10,021 Heller Financial, Inc. 5.116% due 06/25/2001 (d) 1,500 1,501 6.500% due 07/22/2002 10,700 10,857 Household Finance Corp. 5.773% due 08/06/2002 (d) 820 822 Kroger Co. 6.340% due 06/01/2001 1,210 1,211 Lehman Brothers Holdings, Inc. 5.776% due 04/02/2002 (d) 3,450 3,472 6.186% due 07/08/2002 (d) 4,300 4,303 6.479% due 07/15/2002 (d) 6,800 6,846 5.580% due 08/06/2002 (d) 3,600 3,602 5.389% due 09/03/2002 (d) 1,000 1,000 5.610% due 12/12/2002 (d) 17,900 17,973 5.240% due 04/04/2003 (d) 9,200 9,214 MBNA Corp. 5.610% due 08/07/2001 (d) 500 500 Merrill Lynch & Co. 5.605% due 11/01/2001 (d) 9,910 9,921 5.006% due 06/24/2003 (d) 2,100 2,099 Morgan Stanley, Dean Witter & Co. 5.723% due 01/28/2002 (d) 20,400 20,438 National Rural Utilities Cooperative Finance Corp. 5.721% due 08/13/2002 (d) 2,100 2,100 Pacific Gas & Electric Co. 7.575% due 10/31/2001 (d)(k) 19,600 16,170 Procter & Gamble Co. 1.500% due 12/07/2005 JY1,000,000 8,268 Protective Life Funding Trust 6.089% due 01/17/2003 (d) $ 2,100 2,104 Public Service Enterprise 6.258% due 05/21/2002 (d) 20,000 20,028 Salomon, Smith Barney Holdings 3.650% due 02/14/2002 13,467 13,540 5.879% due 04/15/2002 (d) 1,000 1,001 6.204% due 10/21/2002 (d) BP 2,480 3,519 5.629% due 02/11/2003 (d) $ 400 401 5.848% due 04/28/2003 (d) 800 801 Scana Corp. 5.910% due 02/08/2002 (d) 2,810 2,814 Sierra Pacific Resources 6.299% due 04/20/2002 (d) 400 340 Sprint Capital Corp. 6.850% due 06/24/2002 (d) 1,500 1,501 Sprint Spectrum LP 11.000% due 08/15/2006 6,845 7,289 Texas Utilities Corp. 5.420% due 06/25/2001 (d) 19,700 19,698 7.389% due 09/24/2001 (d) 4,300 4,288 Texas Utilities Electric Co. 5.650% due 12/20/2002 (d) 8,050 8,054 Transamerica Finance Corp. 6.830% due 12/14/2001 (d) 6,500 6,502 U.S. Bancorp 5.755% due 02/03/2003 (d) 600 602 Williams Cos., Inc. 5.889% due 11/15/2001 (d) 13,800 13,820 ---------- 535,597 ---------- Mortgage-Backed Securities 41.5% Amortizing Residential Collateral Trust 5.790% due 09/25/2030 (d) 1,768 1,770 Bear Stearns Adjustable Rate Mortgage Trust 7.499% due 12/25/2040 (d) 18,664 18,830 CDC Depositor Trust I 6.019% due 12/14/2001 (d) 2,154 2,158 Chase Mortgage Finance Corp. 6.550% due 08/25/2028 1,441 1,454 2001 Annual Report See accompanying notes 47 Schedule of Investments (Cont.) International Portfolio March 31, 2001 Principal Amount Value (000s) (000s) Citicorp Mortgage Securities, Inc. 6.500% due 07/25/2028 $ 1,499 $ 1,507 Countrywide Home Loans 6.750% due 08/25/2028 620 622 Countrywide Mortgage Backed Securities, Inc. 6.750% due 05/25/2024 1,032 1,038 Credit-Based Asset Servicing 7.840% due 11/27/2031 5,810 5,886 Crusade Global Trust 5.719% due 02/15/2030 (d) 23,779 23,838 Fannie Mae 7.000% due 01/01/2005 1,200 1,220 8.800% due 01/25/2019 1,294 1,374 7.000% due 02/25/2020 4,227 4,271 7.000% due 09/25/2023 168 170 Freddie Mac 5.250% due 01/15/2006 EC 5,000 4,507 5.919% due 07/15/2028 (d) $ 1,750 1,750 6.500% due 04/14/2029 12,000 11,959 General Electric Capital Mortgage Services, Inc. 6.750% due 08/25/2029 5,191 5,227 Government National Mortgage Association 7.500% due 01/15/2030-04/23/2031 (g) 1,578,124 810,563 7.000% due 04/20/2030-06/20/2030 (d)(g) 86,415 47,870 8.000% due 04/23/2031 198,500 204,890 7.375% due 03/20/2022 (d) 487 494 7.375% due 04/20/2022 (d) 433 441 7.750% due 08/20/2022-09/20/2026 (d)(g) 22,337 11,613 7.625% due 11/20/2022 (d) 1,247 1,279 7.375% due 06/20/2023 (d) 945 962 7.625% due 11/20/2023 (d) 1,030 1,056 7.625% due 10/20/2024 (d) 3,095 3,173 7.625% due 11/20/2024 (d) 2,744 2,814 7.625% due 11/20/2024 (d) 4,627 4,744 7.375% due 02/20/2025 (d) 1,701 1,724 7.375% due 04/20/2026 (d) 882 896 7.375% due 05/20/2026 (d) 1,554 1,578 8.500% due 01/15/2030-04/23/2031 (g) 440,343 229,007 J.P. Morgan Commercial Mortgage Finance Corp. 5.444% due 04/15/2010 (d) 11,868 11,867 Medallion Trust 5.880% due 07/12/2031 (d) 10,098 10,103 Nationslink Funding Corp. 5.805% due 11/10/2030 483 483 5.921% due 04/10/2007 (d) 1,321 1,321 PNC Mortgage Securities Corp. 6.013% due 12/25/2030 (d) 1,484 1,487 Residential Accredit Loans, Inc. 7.750% due 03/25/2030 3,071 3,109 Residential Funding Mortgage Securities I 6.750% due 06/25/2028 765 767 Residential Funding Mortgage Securities, Inc. 5.779% due 05/12/2032 (d) 26,275 26,310 Salomon Brothers Mortgage Securities VII 5.430% due 05/25/2029 (d) 1,379 1,384 Sasco Floating Rate Commercial Mortgage Trust 5.408% due 11/20/2001 (d) 4,342 4,346 Saxon Mortgage Securities Corp. 6.750% due 02/25/2024 2,263 2,278 Starwood Asset Receivables Trust 5.350% due 08/25/2003 (d) 1,702 1,703 Washington Mutual, Inc. 7.175% due 01/25/2041 (d) 9,349 9,638 5.690% due 07/26/2003 (d) 3,832 3,831 ----------- 1,489,312 ----------- U.S. Government Agencies 0.9% Federal Home Loan Bank 5.805% due 02/15/2002 (d) 31,480 31,628 ----------- U.S. Treasury Obligations 6.3% Treasury Inflation Protected Securities (h) 3.625% due 07/15/2002 (b) 199,990 203,928 U.S. Treasury Bonds 8.750% due 08/15/2020 17,000 23,322 ----------- 227,250 ----------- Total United States 2,487,234 (Cost $2,491,513) ----------- -------------------------------------------------------------------------------- PURCHASED CALL OPTIONS 3.5% -------------------------------------------------------------------------------- Republic of Germany (OTC) 5.250% due 01/04/2011 Strike @ 90.00 Exp. 04/03/2001 1,000,000 124,715 ----------- Total Purchased Call Options 124,715 (Cost $120,916) ----------- -------------------------------------------------------------------------------- PURCHASED PUT OPTIONS 0.0% -------------------------------------------------------------------------------- Republic of Germany (OTC) 5.250% due 07/04/2010 Strike @ 96.75 Exp. 04/06/2001 1,000,000 0 Republic of Germany (OTC) 5.375% due 01/04/2010 Strike @ 97.89 Exp. 04/17/2001 600,000 0 U.S. Treasury Bond (OTC) 3.625% due 07/15/2002 Strike @ 96.50 Exp. 04/30/2001 136,380 0 ----------- Total Purchased Put Options 0 (Cost $216) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 7.8% -------------------------------------------------------------------------------- Commercial Paper 7.1% Abbey National PLC 4.870% due 05/02/2001 3,800 3,785 4.700% due 09/05/2001 2,600 2,546 American Express Co. 4.840% due 05/15/2001 20,500 20,381 Freddie Mac 4.685% due 09/04/2001 30,000 29,384 General Electric Capital Corp. 4.690% due 05/30/2001 19,700 19,538 Gillette Co. 4.780% due 08/21/2001 5,200 5,102 National Rural Utilities Cooperative Finance Corp. 4.820% due 05/24/2001 23,500 23,336 Swedbank, Inc. 4.860% due 05/30/2001 20,500 20,332 4.700% due 09/05/2001 36,100 35,356 UBS Finance, Inc. 4.670% due 06/13/2001 73,000 72,272 4.830% due 08/15/2001 6,600 6,480 Williams Cos., Inc. 7.231% due 04/10/2001 (d)(g) 23,800 14,306 ----------- 252,818 ----------- Repurchase Agreement 0.5% State Street Bank 4.600% due 04/02/2001 19,236 19,236 (Dated 03/30/2001. Collateralized by Freddie Mac 7.000% due 03/15/2010 valued at $19,624. Repurchase proceeds are $19,243.) U.S. Treasury Bills (b) 0.2% 4.600% due 05/17/2001 (g) 6,870 6,829 ----------- Total Short-Term Instruments 278,883 (Cost $278,966) ----------- 48 PIMCO Funds See accompanying notes Total Investments (a) 150.1% $ 5,386,312 (Cost $5,501,595) Written Options (c) (0.0%) (1,721) (Premiums $1,606) Other Assets and Liabilities (Net) (50.1%) (1,796,054) ----------- Net Assets 100.0% $ 3,588,537 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $5,502,696 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost $ 22,387 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value (138,771) ----------- Unrealized depreciation-net $ (116,384) ----------- (b) Securities with an aggregate market value of $36,191 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: Unrealized # of Appreciation/ Type Contracts (Depreciation) -------------------------------------------------------------------------------- EuroBond 10 Year Note (06/2001) 8,982 $ 5,214 Government of Japan 10 Year Note (06/2001) 118 137 United Kingdom 90 Day LIBOR Futures (06/2001) 40 (12) United Kingdom 90 Day LIBOR Futures (03/2002) 47 2 United Kingdom 90 Day LIBOR Futures (06/2002) 51 (2) United Kingdom 90 Day LIBOR Futures (09/2002) 49 (5) United Kingdom 90 Day LIBOR Futures (12/2002) 49 (4) ----------- $ 5,330 ----------- (c) Premiums received on written options: # of Type Contracts Premium Value -------------------------------------------------------------------------------- Put - CME Eurodollar December Futures Strike @ 95.00 Exp. 12/17/2001 180,000 $ 76 $ 54 Call - CBOT U.S. Treasury Note June Futures Strike @ 107.00 Exp. 05/26/2001 15,800 100 133 Put - CME Eurodollar December Futures Strike @ 95.25 Exp. 12/17/2001 1,008,000 503 555 Call - CBOT U.S. Treasury Note June Futures Strike @ 108.00 Exp. 05/26/2001 110,700 604 606 Put - CBOT U.S. Treasury Note June Futures Strike @ 105.00 Exp. 05/26/200 165,100 323 373 ------------------- $ 1,606 $ 1,721 ------------------- (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Sell A$ 9,667 04/2001 $ 573 Buy 2,735 05/2001 (16) Sell SF 47,533 05/2001 227 Sell DK 12,769 05/2001 81 Buy EC 746,848 04/2001 (9,779) Sell 745,332 04/2001 39,099 Buy 5,861 05/2001 (67) Buy 299 06/2001 0 Sell 342,835 06/2001 1,294 Buy BP 1,042 05/2001 (36) Sell 32,105 05/2001 1,473 Sell H$ 592,000 05/2001 198 Buy 200,100 08/2001 (88) Sell 438,783 08/2001 339 Buy HF 3,570,000 08/2001 (605) Buy JY 54,959,634 04/2001 (8,678) Sell 54,727,353 04/2001 10,658 Buy 863,705 05/2001 (488) Sell 1,051,534 05/2001 563 Sell 65,098,258 06/2001 9,495 Sell N$ 81,460 04/2001 1,411 Sell SK 56,051 05/2001 353 ----------- $ 46,007 ----------- (f) Principal amount denoted in indicated currency: A$ - Australian Dollar BP - British Pound C$ - Canadian Dollar DK - Danish Krone DM - German Mark EC - Euro GD - Greek Drachma HF - Hungarian Forint H$ - Hong Kong Dollar JY - Japanese Yen N$ - New Zealand Dollar PZ - Polish Zloty SF - Swiss Franc SK - Swedish Krona (g) Securities are grouped by coupon or range of coupons and represent a range of maturities. (h) Principal amount of the security is adjusted for inflation. (i) Swap agreements outstanding at March 31, 2001: Unrealized Notional Appreciation/ Type Amount (Depreciation) -------------------------------------------------------------------------------- Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.347% Broker: Bank of America Exp. 03/15/2011 JY 55,000,000 $ 824 Receive floating rate based on 6-month JY-LIBOR and pay a fixed rate equal to 1.347% Broker: Merrill Lynch 30,000,000 (844) Exp. 03/15/2011 Receive a fixed rate equal to 5.559% and pay floating rate based on 6-month BP-LIBOR. Broker: Lehman Brothers Exp. 01/10/2003 BP 25,000 214 2001 Annual Report See accompanying notes 49 Schedule of Investments (Cont.) International Portfolio March 31, 2001 Receive floating rate based on 6-month Australian Bank Bill and pay a fixed rate equal to 5.217% Broker: Morgan Stanley Exp. 03/15/2006 A$ 42,600,000 $ 198 Receive fixed rate equal to 7.470% and pay floating rate based on 3-month New Zealand Bank Bill. Broker: Citibank Exp. 08/31/2001 N$ 50,000 151 Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.248%. Broker: Royal Bank of Canada Exp. 08/02/2005 C$ 133,300 (3,282) Receive floating rate based on 3-month H$-HIBOR and pay fixed rate equal to 6.910%. Broker: Goldman Sachs Exp. 02/15/2006 H$ 1,043,000 (7,076) Receive floating rate based on 3-month H$-HIBOR and pay fixed rate equal to 5.753%. Broker: Goldman Sachs Exp. 02/08/2006 686,000 (336) Receive floating rate based on 3-month Canadian Bank Bill and pay fixed rate equal to 6.515%. Broker: J.P. Morgan Exp. 05/10/2002 C$ 51,990 (646) Receive floating rate based on 6-month JY-LIBOR and pay fixed rate equal to 2.020%. Broker: Goldman Sachs Exp. 05/18/2010 JY 7,436,060 (4,024) Receive a fixed rate equal to 5.873% and pay floating rate based on 6-month EURO-LIBOR. Broker: Morgan Stanley Exp. 01/15/2031 EC 95,000 4,267 Receive a fixed rate equal to 6.100% and pay floating rate based on 6-month EURO-LIBOR. Broker: Morgan Stanley Exp. 01/15/2031 52,000 2,417 Receive a fixed rate equal to 4.785% and pay floating rate based on 6-month EURO-LIBOR. Broker: Goldman Sachs Exp. 03/15/2006 500,000 1,186 Receive a fixed rate equal to 4.610% and pay floating rate based on 6-month EURO-LIBOR. Broker: J.P. Morgan Exp. 03/15/2004 2,000,000 3,841 Receive a fixed rate equal to 4.610% and pay floating rate based on 6-month EURO-LIBOR. Broker: Merrill Lynch Exp. 03/15/2004 450,000 1,374 Receive a fixed rate equal to 6.790% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 02/15/2006 $ 134,700 7,930 Receive a fixed rate equal to 5.540% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 01/05/2003 BP 300,000 2,465 Receive a fixed rate equal to 5.674% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Exp. 01/08/2004 91,100 1,345 Receive floating rate based on 6-month JY-LIBOR and pay fixed rate equal to 1.313%. Broker: Merrill Lynch Exp. 01/11/2008 JY 20,000,000 (4,204) Receive floating rate based on 6-month JY-LIBOR and pay fixed rate equal to 1.777%. Broker: Goldman Sachs Exp. 01/12/2011 3,692,000 (1,226) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.300%. Broker: Goldman Sachs Exp. 01/19/2011 BP 128,000 986 Receive a fixed rate equal to 6.505% and pay floating rate based on 6-month EURO-LIBOR. Broker: Goldman Sachs Exp. 01/25/2016 EC 200,000 672 Receive a fixed rate equal to 5.670% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 02/08/2006 $ 87,600 967 Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.410%. Broker: Morgan Stanley Exp. 09/01/2002 BP 54,000 (202) Receive a fixed rate equal to 5.513% and pay floating rate based on 6-month BP-LIBOR. Broker: Morgan Stanley Exp. 03/01/2004 54,000 488 Receive a fixed rate equal to 6.343% and pay floating rate based on 6-month EURO-LIBOR. Broker: Lehman Brothers Exp. 03/08/2016 EC 69,300 (36) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.465%. Broker: Lehman Brothers Exp. 03/08/2016 BP 45,400 74 50 PIMCO Funds See accompanying notes Receive a fixed rate equal to 5.472% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/15/2006 BP 398,200 $ 2,226 Receive a fixed rate equal to 5.484% and pay floating rate based on 6-month BP-LIBOR. Broker: J.P. Morgan Exp. 03/15/2006 120,000 742 Receive a fixed rate equal to 5.440% and pay floating rate based on 3-month LIBOR. Broker: Goldman Sachs Exp. 03/19/2006 $ 130,700 175 Receive floating rate based on 3-month H$-HIBOR and pay fixed rate equal to 5.550%. Broker: Goldman Sachs Exp. 03/16/2006 H$ 1,020,100 704 Receive a fixed rate equal to 5.467% and pay floating rate based on 3-month LIBOR. Broker: Morgan Stanley Exp. 03/15/2006 $ 21,550 1 Receive a fixed rate equal to 5.225% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/19/2003 BP 121,930 62 Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.220%. Broker: J.P. Morgan Exp. 09/19/2002 381,000 (258) Receive a fixed rate equal to 5.308% and pay floating rate based on 6-month BP-LIBOR. Broker: J.P. Morgan Exp. 03/19/2006 381,000 (104) Receive a fixed rate equal to 5.305% and pay floating rate based on 6-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/19/2006 125,000 (223) Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.215%. Broker: Goldman Sachs Exp. 09/19/2002 125,000 (95) Receive a fixed rate equal to 4.786% and pay floating rate based on 6-month EURO-LIBOR. Broker: J.P. Morgan Exp. 03/15/2006 EC 999,200 1,380 Receive a fixed rate equal to 5.227% and pay floating rate based on 6-month BP-LIBOR. Broker: Merrill Lynch Exp. 03/15/2004 BP 400,000 215 Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.230%. Broker: J.P. Morgan Exp. 09/20/2002 BP 200 $ 0 Receive a fixed rate equal to 5.316% and pay floating rate based on 6-month BP-LIBOR. Broker: J.P. Morgan Exp. 03/20/2006 200 0 Receive a fixed rate equal to 6.380% and pay floating rate based on 6-month EURO--LIBOR. Broker: Goldman Sachs Exp. 03/22/2016 EC 269,300 66 Receive floating rate based on 6-month BP-LIBOR and pay fixed rate equal to 5.510%. Broker: Goldman Sachs Exp. 03/22/2016 BP 172,400 (8) Receive a fixed rate equal to 5.133% and pay floating rate based on 3-month BP-LIBOR. Broker: Goldman Sachs Exp. 03/19/2003 1,835,700 (1,706) ----------- $ 10,700 ----------- (j) Subject to financing transaction. (k) Security is in default. (l) Short sales open at March 31, 2001 were as follows: Coupon Type (%) Maturity Par Value Proceeds -------------------------------------------------------------------------------- Government National Mortgage Association 7.500 04/23/2031 750,000 $ 768,750 $ 769,344 Government National Mortgage Association 8.500 04/24/2031 201,000 208,413 208,535 Republic of Germany 5.250 01/04/2011 220,000 201,469 204,042 Republic of France 5.500 04/25/2010 3,030 2,782 2,790 ------------------------ $ 1,181,414 $ 1,184,711 ------------------------ 2001 Annual Report See accompanying notes 51 Schedule of Investments Emerging Markets Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- ARGENTINA 0.2% -------------------------------------------------------------------------------- Republic of Argentina 0.000% due 04/15/2001 $ 600 $ 599 ----------- Total Argentina 599 (Cost $598) ----------- -------------------------------------------------------------------------------- BALTIC NATIONS 0.1% -------------------------------------------------------------------------------- Republic of Kazakhstan 8.375% due 10/02/2002 $ 200 204 ----------- Total Baltic Nations 204 (Cost $198) ----------- -------------------------------------------------------------------------------- BERMUDA 0.7% -------------------------------------------------------------------------------- IMEXA Export Trust 10.125% due 05/31/2003 $ 2,157 2,101 ----------- Total Bermuda 2,101 (Cost $2,086) ----------- -------------------------------------------------------------------------------- BRAZIL 12.4% -------------------------------------------------------------------------------- Republic of Brazil 7.625% due 04/15/2006 (d)(e) $ 11,114 10,073 7.437% due 04/15/2009 (d) 3,500 2,939 7.687% due 04/15/2009 (d) 750 630 8.000% due 04/15/2014 6,465 5,005 12.750% due 01/15/2020 2,500 2,378 7.625% due 04/15/2024 1,000 757 8.875% due 04/15/2024 6,500 4,420 6.000% due 04/15/2024 3,500 2,410 10.125% due 05/15/2027 (e) 4,000 3,056 12.250% due 03/06/2030 1,450 1,280 11.000% due 08/17/2040 3,500 2,776 ----------- Total Brazil 35,724 (Cost $36,503) ----------- -------------------------------------------------------------------------------- BULGARIA 9.4% -------------------------------------------------------------------------------- Republic of Bulgaria 6.312% due 07/28/2011 (d) $ 8,250 6,198 3.000% due 07/28/2012 (d) 6,191 4,688 7.750% due 07/28/2024 (d)(e) 21,560 16,090 ----------- Total Bulgaria 26,976 (Cost $27,853) ----------- -------------------------------------------------------------------------------- CAYMAN ISLANDS 0.9% -------------------------------------------------------------------------------- Korea Asset Funding Ltd. 7.270% due 02/10/2009 (d) $ 1,000 1,031 Nacional Financiera 7.283% due 05/08/2003 (d) 1,600 1,656 ----------- Total Cayman Islands 2,687 (Cost $2,611) ----------- -------------------------------------------------------------------------------- COLOMBIA 2.0% -------------------------------------------------------------------------------- Republic of Colombia 10.875% due 03/09/2004 $ 1,430 1,476 11.772% due 08/13/2005 (d) 60 60 7.625% due 02/15/2007 2,480 2,164 9.750% due 04/23/2009 2,350 2,139 ----------- Total Colombia 5,839 (Cost $5,327) ----------- -------------------------------------------------------------------------------- CROATIA (b)(c) 4.3% -------------------------------------------------------------------------------- Republic of Croatia 7.000% due 02/27/2002 $ 3,550 3,557 7.000% due 03/28/2005 EC 1,000 904 6.250% due 07/31/2006 $ 3,057 2,988 6.250% due 07/31/2010 (d) 5,182 5,007 ----------- Total Croatia 12,456 (Cost $12,428) ----------- -------------------------------------------------------------------------------- JORDAN 0.4% -------------------------------------------------------------------------------- Kingdom of Jordan 6.000% due 12/23/2023 1,600 1,218 ----------- Total Jordan 1,218 (Cost $1,171) ----------- -------------------------------------------------------------------------------- MALAYSIA 0.3% -------------------------------------------------------------------------------- Republic of Malaysia 6.875% due 05/15/2001 $ 900 913 ----------- Total Malaysia 913 (Cost $899) ----------- -------------------------------------------------------------------------------- MEXICO (b)(c) 18.4% -------------------------------------------------------------------------------- Banco Nacional de comercio Exterior 7.250% due 02/02/2004 $ 3,100 3,060 Bancomext Trust 8.000% due 08/05/2003 3,627 3,688 Nacional Financiera 9.750% due 03/12/2002 1,400 1,447 Petroleos Mexicanos 7.768% due 07/15/2005 (d) 2,250 2,256 9.375% due 12/02/2008 4,800 5,004 Petroliam Nasional 7.625% due 10/15/2026 1,030 913 United Mexican States 0.000% due 06/30/2003 (d) 33,635 420 8.341% due 04/07/2004 (d) EC 3,500 3,133 9.616% due 04/07/2004 (d) $ 325 334 8.625% due 03/12/2008 2,000 2,038 10.375% due 02/17/2009 2,000 2,200 9.875% due 02/01/2010 2,750 2,959 8.125% due 12/30/2019 3,250 2,919 6.250% due 12/31/2019 16,575 14,982 7.412% due 12/31/2019 4,750 4,647 7.515% due 12/31/2019 (d) 420 411 7.532% due 12/31/2019 517 506 11.500% due 05/15/2026 1,700 2,040 ----------- Total Mexico 52,957 (Cost $52,269) ----------- -------------------------------------------------------------------------------- MOROCCO 0.8% -------------------------------------------------------------------------------- Morroco Restructured Tranche A 7.625% due 01/01/2009 $ 2,444 2,169 ----------- Total Morocco 2,169 (Cost $2,174) ----------- -------------------------------------------------------------------------------- PANAMA 7.1% -------------------------------------------------------------------------------- Republic of Panama 7.875% due 02/13/2002 $ 3,688 3,721 7.733% due 05/10/2002 (d) 113 114 4.500% due 07/17/2014 (d)(e) 11,875 9,916 8.875% due 09/30/2027 3,210 2,817 9.375% due 04/01/2029 3,750 3,778 ----------- Total Panama 20,346 (Cost $19,744) ----------- -------------------------------------------------------------------------------- PERU 5.6% -------------------------------------------------------------------------------- Republic of Peru 4.000% due 03/07/2017 $ 9,100 5,689 4.500% due 03/07/2017 (e) 15,248 10,396 ----------- Total Peru 16,085 (Cost $15,482) ----------- -------------------------------------------------------------------------------- PHILIPPINES 3.3% -------------------------------------------------------------------------------- Republic of Philippines 6.875% due 01/05/2005 (d) $ 2,744 2,649 6.500% due 12/01/2017 8,500 6,885 ----------- Total Philippines 9,534 (Cost $9,569) ----------- 52 PIMCO Funds See accompanying notes Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- POLAND 12.0% -------------------------------------------------------------------------------- Republic of Poland 6.000% due 10/27/2014 $ 13,600 $ 13,244 3.750% due 10/27/2024 24,980 18,234 4.250% due 10/27/2024 4,000 3,170 ----------- Total Poland 34,648 (Cost $32,169) ----------- -------------------------------------------------------------------------------- QATAR 3.0% -------------------------------------------------------------------------------- State of Qatar 9.750% due 06/15/2030 $ 8,085 8,630 ----------- Total Qatar 8,630 (Cost $8,224) ----------- -------------------------------------------------------------------------------- RUSSIA 2.6% -------------------------------------------------------------------------------- Russian Federation 9.250% due 11/27/2001 $ 1,550 1,558 11.750% due 06/10/2003 6,100 5,961 ----------- Total Russia 7,519 (Cost $7,488) ----------- -------------------------------------------------------------------------------- SLAVOKIA (b)(c) 0.2% -------------------------------------------------------------------------------- Slovak Wireless Finance 11.250% due 03/30/2007 EC 500 450 ----------- Total Slavokia 450 (Cost $485) ----------- -------------------------------------------------------------------------------- SOUTH AFRICA 1.9% -------------------------------------------------------------------------------- Republic of South Africa 9.125% due 05/19/2009 $ 5,250 5,486 ----------- Total South Africa 5,486 (Cost $5,450) ----------- -------------------------------------------------------------------------------- SOUTH KOREA 11.4% -------------------------------------------------------------------------------- Cho Hung Bank 11.875% due 04/01/2010 $ 3,000 2,980 Export-Import Bank Korea 7.250% due 06/25/2001 800 802 6.500% due 11/15/2006 2,500 2,547 Hansol Paper Co. 8.600% due 05/24/2001 (d) 1,800 1,818 Hanvit Bank 11.750% due 03/01/2010 3,340 3,315 12.750% due 03/01/2010 2,000 1,990 Korea Development Bank 7.625% due 10/01/2002 1,300 1,333 8.294% due 06/16/2003 (d) 3,000 2,940 6.625% due 11/21/2003 2,900 2,936 7.375% due 09/17/2004 4,500 4,627 Republic of Korea 8.875% due 04/15/2008 6,700 7,454 ----------- Total South Korea 32,742 (Cost $31,594) ----------- -------------------------------------------------------------------------------- TUNISIA 1.5% -------------------------------------------------------------------------------- Banque Centrale De Tunisie 8.250% due 09/19/2027 $ 4,750 4,287 ----------- Total Tunisia 4,287 (Cost $4,055) ----------- -------------------------------------------------------------------------------- URUGUAY 0.1% -------------------------------------------------------------------------------- Banco Central Del Uruguay 7.250% due 02/19/2006 $ 147 132 ----------- Total Uruguay 132 (Cost $140) ----------- -------------------------------------------------------------------------------- VENEZUELA 1.0% -------------------------------------------------------------------------------- Republic of Venezuela 7.375% due 12/18/2007 (d) $ 3,000 2,510 6.750% due 03/31/2020 500 385 ----------- Total Venezuela 2,895 (Cost $2,930) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 4.0% -------------------------------------------------------------------------------- Commercial Paper 4.0% Abbey National North America 4.690% due 08/09/2001 1,600 1,572 Coca-Cola Co. 5.040% due 04/12/2001 800 799 4.600% due 07/12/2001 5,000 4,930 General Electric Capital Corp. 4.990% due 04/03/2001 200 200 5.170% due 04/04/2001 700 700 UBS Finance, Inc. 4.670% due 06/13/2001 1,400 1,386 Walt Disney Co. 4.690% due 08/07/2001 2,000 1,966 ----------- Total Short-Term Instruments 11,553 (Cost $11,561) ----------- Total Investments (a) 103.6% $ 298,150 (Cost $293,008) Other Assets and Liabilities (10,270) (Net) (3.6%) ----------- Net Assets 100.0% $ 287,880 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $295,413 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 7,102 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (4,365) ----------- Unrealized appreciation-net $ 2,737 ----------- (b) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) -------------------------------------------------------------------------------- Buy EC 1,905 04/2001 $ (6) Sell 1,905 04/2001 101 Sell 1,905 06/2001 6 Buy HF 2,917,950 05/2001 234 Buy 100,000 09/2001 (17) Buy PZ 13,250 05/2001 479 ----------- $ 797 ----------- (c) Principal amount denoted in indicated currency: EC - Euro HF - Hungarian Forint PZ - Polish Zloty (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Subject to financing transaction. (f) Short sales open at March 31, 2001 were as follows: Coupon Type Rate Maturity Par Value Proceeds -------------------------------------------------------------------------------- Republic of Argentina 7.625 03/31/2005 20,750 $ 17,457 $ 17,739 Republic of Argentina 9.750 09/19/2027 4,000 3,012 3,057 ----------------------- $ 20,469 $ 20,796 ----------------------- 2001 Annual Report See accompanying notes 53 Schedule of Investments Municipal Sector Portfolio March 31, 2001 Principal Amount Value (000s) (000s) -------------------------------------------------------------------------------- MUNICIPAL BONDS & NOTES 99.6% -------------------------------------------------------------------------------- Alabama 3.4% Jefferson County, Alabama Sewer Revenue Bonds Warrants, (FGIC Insured), Series 2000-323 5.800% due 02/01/2029 (d) $ 750 $ 723 Jefferson County, Alabama Sewer Revenue Bonds Warrants, (FGIC Insured), Series 2000-352 6.172% due 02/01/2036 (d) 1,750 1,605 ----------- 2,328 ----------- Alaska 2.2% Northern Tobacco Securitization Bonds, Series 2000 6.500% due 06/01/2031 1,500 1,545 ----------- California 5.5% California State General Obligation Bonds, Series 2000-387 4.850% due 01/01/2027 (d) 1,500 1,435 East Bay, California Municipal Utility District Wastewater Treatment System Revenue Bonds, (AMBAC Insured), Series 1993 6.420% due 06/01/2013 1,000 1,087 Foothill Eastern Corridor Agency California Toll Road Revenue Bonds, Series 1995 0.000% due 01/01/2026 1,000 272 Foothill Eastern Transportation Corridor Agency Toll Road Revenue Bonds, (MBIA Insured), Series 1999 0.000% due 01/15/2027 (e) 1,500 978 ----------- 3,772 ----------- Colorado 1.5% Arapahoe County, Colorado Capital Trust Fund Highway Revenue Bonds, (MBIA Insured), Series 1986 6.150% due 08/31/2026 1,000 1,072 ----------- Florida 2.4% Florida State Governmental Utility Authority Utility Revenue Bonds, (AMBAC Insured), Series 2000 5.850% due 10/01/2029 650 612 Lee County, Florida Airport Revenue Bonds, (FSA Insured), Series 2000-A 6.000% due 10/01/2029 1,000 1,082 ----------- 1,694 ----------- Georgia 1.4% Bartow County, Georgia Development Authority Pollution Control Revenue Bonds, Series 1998 3.900% due 03/01/2025 1,000 1,000 ----------- Illinois 13.4% Chicago, Illinois Board of Education General Obligation Bonds, (FGIC Insured), Series 1998 0.000% due 12/01/2020 3,000 1,057 Chicago, Illinois General Obligation Bonds, (MBIA Insured), Series 2001 5.100% due 01/01/2007 5,965 3,496 Chicago, Illinois Midway Airport Revenue Bonds, (MBIA Insured), Series 1998 5.000% due 01/01/2035 2,565 2,433 Chicago, Illinois Midway Airport Revenue Bonds, (MBIA Insured), Series 2000 5.000% due 01/01/2031 750 679 Chicago, Illinois Residual General Obligation Bonds, (MBIA Insured), Series 2000 4.930% due 01/01/2028 500 475 Cook County Illinois General Obligation Bonds, (FGIC Insured), Series 2001 6.690% due 11/15/2028 1,250 1,142 ----------- 9,282 ----------- Indiana 5.6% Eagle-Union Middle School Building Bonds, (AMBAC State Aid Withholding Insured), Series 2001 5.000% due 01/05/2020 2,000 1,959 Merrillville Indiana Multi School Building Corporation Revenue Bonds, (MBIA Insured), Series 2001 5.000% due 01/05/2021 2,000 1,948 ----------- 3,907 ----------- Kentucky 6.6% Kentucky State Turnpike Authority Economic Development Road Revenue Bonds, Series 1993 4.490% due 06/06/2012 4,000 4,534 ----------- Massachusetts 7.4% Massachusetts Bay Transition Authority Massachussetts Revenue Bonds, (Go of Authority Insured), Series 2000 5.530% due 03/01/2028 500 467 Massachusetts State Individual Financing Agency Revenue Bonds, (Go of Institution), Series 1998 5.000% due 03/01/2028 1,000 963 Massachusetts State Turnpike Authority Revenue Bonds, (AMBAC Insured), Series 2000 6.100% due 01/01/2039 600 531 Massachusetts State Water Residential Authority Revenue Bonds, (FSA Go of Authority Insured), Series 2001 6.290% due 08/01/2037 500 397 Massachussetts State Development Financial Agency Revenue Bonds, (GNMA Insured), Series 2000 9.000% due 06/20/2031 375 408 Massachussetts State Water Residential Authority Revenue Bonds, (MBIA Insured), Series 1995 4.750% due 12/01/2021 2,500 2,355 ----------- 5,121 ----------- Nevada 1.7% Nevada State General Obligation Bonds, (FGIC Insured), Series 2001 6.690% due 05/15/2028 1,288 1,202 ----------- New Hampshire 4.9% New Hampshire Educational & Health Facilities Authority Revenue Bonds, Series 1997 5.125% due 06/01/2028 1,400 1,383 New Hampshire Health & Educational Facilities Authority Revenue Bonds, (AMBAC Insured), Series 2002 5.375% due 07/01/2020 2,000 1,984 ----------- 3,367 ----------- New Jersey 10.3% New Jersey Economic Development Authority Revenue Bonds, Series 1998 6.375% due 04/01/2018 500 510 6.375% due 04/01/2031 2,000 2,025 New Jersey State Highway Authority Garden State Parkway General Revenue Bonds, (FGIC Insured), Series 2001 5.500% due 01/01/2013 2,500 2,690 New Jersey State Transition Trust Fund Authority Revenue Bonds, Series 1998 4.500% due 06/15/2019 2,000 1,872 ----------- 7,097 ----------- New York 5.7% Long Island Power Authority New York Electric System Revenue Bonds, (FSA Insured), Series 2001 7.040% due 12/01/2022 650 650 New York City, New York Transitional Financial Authority Revenue Bonds, Series 2000 6.510% due 11/01/2024 1,000 962 54 PIMCO Funds See accompanying notes Principal Amount Value (000s) (000s) New York State Dormitory Authority Revenue Bonds, (MBIA Insured), Series 1996 5.600% due 07/01/2016 $ 1,250 $ 1,312 Port Authority of New York & New Jersey Special Obligation Revenue Bonds, (MBIA Insured), Series 1997 5.750% due 12/01/2022 1,000 1,050 ----------- 3,974 ----------- Pennsylvania 8.4% Lewistown Boro, Pennsylvania Municipal Authority Water Revenue Bonds, (MBIA Insured), Series 2001 5.150% due 01/01/2030 1,155 1,143 Pennsylvania Economic Development Financing Authority MultiFamily Revenue Bonds, (GIC-AIG Insured), Series 2000 4.700% due 06/01/2004 3,730 3,764 Philadelphia PA School District Bonds, (MBIA Insured), Series 1998 4.750% due 04/01/2027 500 465 Philadelphia School District General Obligation Bonds, (MBIA Insured), Series 2000 5.540% due 04/01/2027 500 430 ----------- 5,802 ----------- Puerto Rico 1.1% Childrens Trust Fund Tobacco Settlement Revenue Bonds, Series 2000 6.000% due 07/01/2026 700 728 ----------- South Carolina 3.1% South Carolina State Public Service Authority Revenue Bonds, Series 1993 5.538% due 06/28/2013 2,000 2,141 ----------- Texas 14.3% Arlington, Texas Independent School District General Obligation Bonds, (PSF-FTD Insured), Series 1999 5.000% due 02/15/2024 1,000 966 Denton County, Texas General Obligation Bonds, Series 1999 5.125% due 07/15/2026 3,500 3,468 Denton County, Texas Utility System Revenue Bonds, (MBIA Insured), Series 2000 5.680% due 12/01/2029 1,000 959 Houston Independent School District General Obligation Bonds, (PSF Insured), Series 1999 4.750% due 02/15/2026 1,000 915 Houston, Texas Airport System Revenue Bonds, (FGIC Insured), Series 2001 6.690% due 07/01/2028 700 628 Houston, Texas Independent School District General Obligation Bonds, (PSF-GTD Insured), Series 2001 6.160% due 02/15/2026 750 623 Katy, Texas Independent School District General Obligation Ltd Bonds, (PSF-GTD Insured), Series 1998 4.750% due 02/15/2024 2,500 2,306 ----------- 9,865 ----------- Washington State 0.7% Port Seattle Washington Revenue Bonds, (MBIA Insured), Series 2000 6.800% due 02/01/2024 500 516 ----------- Total Municipal Bonds & Notes 68,947 (Cost $66,861) ----------- -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 1.2% -------------------------------------------------------------------------------- Freddie Mac 4.920% due 04/10/2001 800 799 ----------- Total U.S. Government Agencies 799 (Cost $799) ----------- -------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 0.8% -------------------------------------------------------------------------------- Treasury Inflation Protected Securities 3.625% due 07/15/2002 (b)(c) $ 547 $ 557 ----------- Total U.S. Treasury Obligations 557 (Cost $547) ----------- -------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 2.9% -------------------------------------------------------------------------------- Commercial Paper 2.7% Freddie Mac 4.920% due 04/03/2001 1,400 1,400 SSgA Tax Free Money Market 3.080% due 04/02/2001 500 500 ----------- 1,900 ----------- U.S. Treasury Bills (b) 0.2% 4.516% due 05/17/2001 110 109 ----------- Total Short-Term Instruments 2,009 (Cost $2,009) ----------- Total Investments (a) 104.5% $ 72,312 (Cost $70,216) Other Assets and Liabilities (Net) (4.5%) (3,101) ----------- Net Assets 100.0% $ 69,211 ----------- Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $70,216 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 2,259 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (163) ----------- Unrealized appreciation-net $ 2,096 ----------- (b) Securities with an aggregate market value of $666 have been segregated with the custodian to cover margin requirements for the following open futures contracts at March 31, 2001: # of Unrealized Type Contracts Appreciation -------------------------------------------------------------------------------- U.S. Treasury 30 Year Bond (06/2001) 200 $ 248 ----------- (c) Principal amount of the security is adjusted for inflation. (d) Variable rate security. The rate listed is as of March 31, 2001. (e) Security becomes interest bearing at a future date. 2001 Annual Report See accompanying notes 55 Notes to Financial Statements March 31, 2001 1. Organization PIMCO Funds: Pacific Investment Management Series (the Trust) was established as a Massachusetts business trust on February 19, 1987. The Trust is registered under the Investment Company Act of 1940 (the Act), as amended, as an open-end investment management company. The Trust currently consists of 39 separate investment portfolios. The Short-Term, U.S. Government Sector, Investment Grade Corporate, High Yield, Mortgage, Asset-Backed Securities, Real Return Bond, International, Emerging Market, and Municipal Sector Portfolios (the "Portfolios") are a series of the Trust. The following is a summary of significant accounting policies followed in the preparation of the Portfolios' financial statements. The policies are in conformity with accounting principles generally accepted in the United States. 2. Significant Accounting Policies The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America. The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America 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. Security Valuation. Portfolio securities and other financial instruments for which market quotations are readily available are stated at market value. Market value is determined on the basis of last reported sales prices, or if no sales are reported, as is the case for most securities traded over-the-counter, the mean between representative bid and asked quotations obtained from a quotation reporting system or from established market makers. Fixed income securities, including those to be purchased under firm commitment agreements (other than obligations having a maturity of sixty days or less), are normally valued on the basis of quotes obtained from brokers and dealers or pricing services. Short-term investments having a maturity of sixty days or less are valued at amortized cost, which approximates market value. Certain fixed income securities for which daily market quotations are not available may be valued, pursuant to guidelines established by the Board of Trustees, with reference to fixed income securities whose prices are more readily obtainable. Securities Transactions and Investment Income. Securities transactions are recorded as of the trade date. Securities purchased or sold on a when-issued or delayed-delivery basis may be settled a month or more after the trade date. Realized gains and losses from securities sold are recorded on the identified cost basis. Dividend income is recorded on the ex-dividend date, except certain dividends from foreign securities where the ex-dividend date may have passed, are recorded as soon as the Portfolio is informed of the ex-dividend date. Interest income, adjusted for the accretion of discounts and amortization of premiums, is recorded on the accrual basis. Dividends and Distributions to Shareholders. Dividends from net investment income, if any, are declared and distributed on a quarterly basis to shareholders. Net realized capital gains earned by a Portfolio, if any, will be distributed no less frequently than once each year. Income dividends and capital gain distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for such items as wash sales, foreign currency transactions, net operating losses and capital loss carryforwards. Distributions reflected as a tax basis return of capital in the accompanying Statements of Changes in Net Assets have been reclassified to paid in capital. In addition, other amounts have been reclassified between undistributed net investment income, accumulated undistributed net realized gains or losses and paid in capital to more appropriately conform financial accounting to tax characterizations of dividends and distributions. Foreign Currency. Foreign currencies, investments, and other assets and liabilities are translated into U.S. dollars at the exchange rates prevailing at the end of the period. Fluctuations in the value of these assets and liabilities resulting from changes in exchange rates are recorded as unrealized foreign currency gains (losses). Realized gains (losses) and unrealized appreciation (depreciation) on investment securities and income and expenses are translated on the respective dates of such transactions. The effect of changes in foreign currency exchange rates on investments in securities are not segregated in the Statements of Operations from the effects of changes in market prices of those securities, but are included with the net realized and unrealized gain or loss on investment securities. Federal Income Taxes. Each Portfolio intends to qualify as a regulated investment company and distribute all of its taxable income and net realized gains, if applicable, to shareholders. Accordingly, no provision for Federal income taxes has been made. Financing Transactions. A Portfolio may enter into financing transactions consisting of the sale by the Portfolio of securities, together with a commitment to repurchase similar securities at a future date. The difference between the selling price and the future purchase price is an adjustment to interest income. If the counterparty to whom the Portfolio sells the security becomes insolvent, a Portfolio's right to repurchase the security may be restricted; the value of the security may change over the term of the financing transaction; and the return earned by a Portfolio with the proceeds of a financing transaction may not exceed transaction costs. 56 PIMCO Funds Notes to Financial Statements (Cont.) March 31, 2001 Futures and Options. The Portfolios are authorized to enter into futures contracts and options. A Portfolio may use futures contracts and options to manage its exposure to the securities markets or to movements in interest rates and currency values. The primary risks associated with the use of futures contracts and options are imperfect correlation between the change in market value of the securities held by a Portfolio and the prices of futures contracts and options, the possibility of an illiquid market, and the inability of the counterparty to meet the terms of the contract. Futures contracts and purchased options are valued based upon their quoted daily settlement prices. The premium received for a written option is recorded as an asset with an equal liability which is marked to market based on the option's quoted daily settlement price. Fluctuations in the value of such instruments are recorded as unrealized appreciation (depreciation) until terminated, at which time realized gains and losses are recognized. Forward Currency Contracts. The Portfolios are authorized to enter into forward foreign exchange contracts for the purpose of hedging against foreign exchange risk arising from the Portfolio's investment or anticipated investment in securities denominated in foreign currencies. A Portfolio also may enter into these contracts for purposes of increasing exposure to a foreign currency or to shift exposure to foreign currency fluctuations from one country to another. All commitments are marked to market daily at the applicable translation rates and any resulting unrealized gains or losses are recorded. Realized gains or losses are recorded at the time the forward contract matures or by delivery of the currency. Risks may arise upon entering into these contracts from the potential inability of counterparties to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Securities Lending. Each Portfolio may engage in securities lending. Each loan is secured by collateral at least equal, at all times, to the market value of the loaned security. During the term of the loan, a Portfolio will continue to receive any interest or dividends paid on the security loaned and pay interest to the borrower on the cash collateral. Loans are subject to termination at the option of the borrower or the Portfolio. The Portfolio bears the risk of delay in recovery of, or even loss of rights in, a security subject to a loan should the borrower fail financially. For the period ended March 31, 2001, certain Portfolios paid interest expense to borrowers of securities in the following amounts: Mortgage Portfolio $10,725,802 International Portfolio $ 230,000 Short Sales. Certain Portfolios have entered into short sales transactions during the fiscal year. A short sale is a transaction in which a Fund sells securities it does not own in anticipation of a decline in the market price of the securities. The Portfolio is obligated to deliver securities at the market price at the time the short position is closed. Possible losses from short sales may be unlimited, whereas losses from purchases cannot exceed the total amount invested. Swaps. The Portfolios are authorized to enter into interest rate, total return and currency exchange swap agreements in order to obtain a desired return at a lower cost than if the Portfolio had invested directly in the asset that yielded the desired return. Swaps involve commitments to exchange components of income (generally interest or returns) pegged to the underlying assets based on a notional principal amount. Swaps are marked to market daily based upon quotations from market makers and the change, if any, is recorded as unrealized gains or losses in the Statements of Operations. A Portfolio bears the risk of loss of the amount expected to be received under a swap agreement in the event of the default or bankruptcy of a counterparty. Delayed Delivery Transactions. A Portfolio may purchase or sell securities on a when-issued or delayed delivery basis. These transactions involve a commitment by a Portfolio to purchase or sell securities for a predetermined price or yield, with payment and delivery taking place beyond the customary settlement period. When delayed delivery purchases are outstanding, a Portfolio will set aside and maintain until the settlement date in a segregated account, liquid assets in an amount sufficient to meet the purchase price. When purchasing a security on a delayed delivery basis, a Portfolio assumes the rights and risks of ownership of the security, including the risk of price and yield fluctuations, and takes such fluctuations into account when determining its net asset value. A Portfolio may dispose of or renegotiate a delayed delivery transaction after it is entered into, and may sell when-issued securities before they are delivered, which may result in a capital gain or loss. When the Portfolio has sold a security on a delayed delivery basis, the Portfolio does not participate in future gains and losses with respect to the security. Forward sales commitments are accounted for by the Portfolio in the same manner as forward currency contracts discussed above. Inflation-Indexed Bonds. Inflation-indexed bonds are fixed income securities whose principal value is periodically adjusted to the rate of inflation. The interest rate on these bonds is generally fixed at issuance at a rate lower than typical bonds. Over the life of an inflation-indexed bond, however, interest will be paid based on a principal value which is adjusted for inflation. Any increase in the principal amount of an inflation-indexed bond will be considered interest income, even though principal is not received until maturity. Repurchase Agreements. Each Portfolio may engage in repurchase transactions. Under the terms of a typical repurchase agreement, the Portfolio takes possession of an underlying debt obligation subject to an obligation of the seller to repurchase, and the Portfolio to resell, the obligation at an agreed-upon price and time. The market value of the collateral must be equal at all times to the total amount of the repurchase obligations, including interest. Generally, in the event of counterparty default, the Portfolio has the right to use the collateral to offset losses incurred. 2001 Annual Report 57 Restricted Securities. Certain Portfolios are permitted to invest in securities that are subject to legal or contractual restrictions on resale. These securities generally may be resold in transactions exempt from registration or to the public if the securities are registered. Disposal of these securities may involve time-consuming negotiations and expense, and prompt sale at an acceptable price may be difficult. 3. Fees, Expenses, and Related Party Transactions Investment Advisory Fee. Pacific Investment Management Company (PIMCO) is a wholly owned subsidiary partnership of PIMCO Advisors L.P. which serves as investment adviser (the Adviser) to the Trust, pursuant to an investment advisory contract. The Adviser receives a monthly fee from each Portfolio at an annual rate based on average daily net assets of the Portfolio. The Advisory Fee is charged at the annual rate of 0.02% for all Portfolios. Administration Fee. PIMCO serves as administrator (the Administrator), and provides administrative services to the Trust for which it receives from each Portfolio a monthly administrative fee based on each Portfolio's average daily net assets. The Administration Fee is charged at the annual rate of 0.10% for the International and Emerging Markets Portfolios; and 0.03% for all other Portfolios. Expenses. The Trust is responsible for the following expenses: (i) salaries and other compensation of any of the Trust's executive officers and employees who are not officers, directors, stockholders or employees of PIMCO or its subsidiaries or affiliates; (ii) taxes and governmental fees; (iii) brokerage fees and commissions and other portfolio transaction expenses; (iv) the costs of borrowing money, including interest expenses; (v) fees and expenses of the Trustees who are not interested persons of PIMCO or the Trust, and any counsel retained exclusively for their benefit; (vi) extraordinary expenses, including costs of litigation and indemnification expenses; and (vii) organization expenses. PIMCO has agreed to waive a portion of the Portfolios administrative fees to the extent that the payment of each Portfolio's pro rata share of Trustee fees and organizational expenses cause the actual expense ratios to rise above the rates disclosed then-current in the prospectus plus 0.49 basis points (calculated as a percentage of each Portfolio's average daily net assets). PIMCO may be reimbursed for these waived amounts in future periods. Each unaffiliated Trustee receives an annual retainer of $45,000*, plus $3,000 for each Board of Trustees meeting attended in person and $500 for each meeting attended telephonically, plus reimbursement of related expenses. In addition, each committee chair receives an annual retainer of $1,500. These expenses are allocated to the Portfolios of the Trust according to their respective net assets. * Effective January 1, 2001, the annual retainer for the unaffiliated Trustee is equal to $60,000. Distributor. PIMCO Funds Distributors LLC, (PFD), a wholly-owned subsidiary of PIMCO Advisors L.P., serves as the distributor of the Portfolios' shares. 4. Acquisition by Allianz AG On May 5, 2000, Allianz AG completed the acquisition of approximately 70% of the outstanding partnership interest in PIMCO Advisors L.P. ("PIMCO Advisors"), of which PIMCO is a subsidiary partnership. As a result of this transaction, PIMCO Advisors, and its subsidiaries, are now controlled by Allianz AG, a leading provider of financial services, particularly in Europe. PIMCO remains operationally independent, continues to operate under its existing name, and now leads the global fixed-income efforts of Allianz AG. Key employees at each PIMCO Advisors' investment units, including PIMCO's Bill Gross, have signed long-term employment contracts and have significant profit-sharing and retention arrangements to ensure continuity of the investment process and staff. The Allianz Group manages assets of approximately (Euro)713.3 billion as of December 31, 2000, including more than 300 mutual funds for retail and institutional clients around the world. 5. Federal Income Tax Matters As of March 31, 2001, the Portfolio listed in the table below had remaining capital loss carryforwards that were realized or acquired in prior years. Use of the acquired capital loss carryforwards may be limited under current tax laws. Additionally, the Short-Term, U.S. Government Sector, Investment Grade Corporate, Mortgage, Real Return, International, Emerging Markets, and Municipal Sector Portfolios realized capital losses and/or foreign currency losses during the period November 1, 2000 through March 31, 2001 which the Portfolio elected to defer to the following fiscal year pursuant to income tax regulations. The amounts are $58,835, $1,083,033, $698,908, $10,490,386, $75,259, $216,611, $1,974,615, $19,661 respectively. The Portfolio will resume capital gain distributions in the future to the extent gains are realized in excess of the available carryforwards. Capital Loss Carryforwards ------------------------------------------------- Realized Losses Acquired Losses Expiration ------------------------------------------------- Emerging Markets Portfolio $ 3,257,844 $ 0 3/31/2009 58 PIMCO Funds Notes to Financial Statements (Cont.) March 31, 2001 6. Shares of Beneficial Interest The Trust may issue an unlimited number of shares of beneficial interest with a $.0001 par value. Changes in shares of beneficial interest were as follows (shares and amounts in thousands):
Short-Term Portfolio U.S. Government Sector Portfolio ----------------------- ------------------------------------------------------ Period from 04/20/2000 Period from 01/31/2000 to 03/31/2001 Year Ended 3/31/2001 to 03/31/2000 Shares Amount Shares Amount Shares Amount Receipts for shares sold 31,863 $ 320,600 140,400 $ 1,559,920 31,467 $ 319,000 Issued as reinvestment of distributions 626 6,284 6,248 68,870 118 1,221 Cost of shares redeemed (13,683) (138,900) (65,217) (729,470) (2,230) (23,100) Net increase resulting from Portfolio share transactions 18,806 $ 187,984 81,431 $ 899,320 29,355 $ 297,121 -------------------------------------------- ------------------------ ------------------------------------------------------- Investment Grade Corporate Portfolio ------------------------------------------------------ Period from 01/26/2000 Year Ended 3/31/2001 to 03/31/2000 Shares Amount Shares Amount Receipts for shares sold 101,327 $ 1,055,526 36,070 $ 362,126 Issued as reinvestment of distributions 2,865 29,275 146 1,468 Cost of shares redeemed (40,948) (419,378) (4,987) (50,350) Net increase resulting from Portfolio share transactions 63,244 $ 665,423 31,229 $ 313,244 -------------------------------------------- ------------------------ ------------------------- High Yield Portfolio Mortgage Portfolio ------------------------ ------------------------------------------------------- Period from 12/08/2000 Period from 01/31/2000 to 3/31/2001 Year Ended 03/31/2001 to 03/31/2000 Shares Amount Shares Amount Shares Amount Receipts for shares sold 68,667 $ 661,618 410,432 $ 4,292,103 95,695 $ 967,529 Issued as reinvestment of distributions 980 9,423 21,487 224,172 309 3,140 Cost of shares redeemed (47,453) (471,509) (205,699) (2,178,527) 0 0 Net increase resulting from Portfolio share transactions 22,194 $ 199,532 226,220 $ 2,337,748 96,004 $ 970,669 ------------------------------------------- ------------------------ -------------------------------------------------------- Asset-Backed Securities Real Return Portfolio Portfolio ------------------------ ------------------------- Period from 10/31/2000 Period from 04/28/2000 to 3/31/2001 to 03/31/2001 Shares Amount Shares Amount Receipts for shares sold 5,485 $ 55,556 22,455 $ 231,658 Issued as reinvestment of distributions 82 855 510 5,240 Cost of shares redeemed (470) (4,851) (3,701) (38,425) Net increase resulting from Portfolio share transactions 5,097 $ 51,560 19,264 $ 198,473 -------------------------------------------- ------------------------ ------------------------- International Portfolio ----------------------------------------------------------------------- Year Ended 03/31/2001 Year Ended 03/31/2000 Shares Amount Shares Amount Receipts for shares sold 442,780 $ 3,048,940 98,595 $ 679,200 Issued as reinvestment of distributions 18,256 124,599 6,156 41,675 Cost of shares redeemed (121,926) (841,610) (36,642) (251,030) Net increase resulting from Portfolio share transactions 339,110 $ 2,331,929 68,109 $ 469,845 ------------------------------------------------- ----------------------------------------------------------------------- Emerging Markets Portfolio ----------------------------------------------------------------------- Year Ended 03/31/2001 Year Ended 03/31/2000 ----------------------------------------------------------------------- Shares Amount Shares Amount Receipts for shares sold 33,499 $ 329,447 23,345 $ 226,178 Issued as reinvestment of distributions 3,259 31,541 2,022 19,552 Cost of shares redeemed (43,726) (425,655) (4,472) (43,668) Net increase resulting from Portfolio share transactions (6,968) $ (64,667) 20,895 $ 202,062 ------------------------------------------------- ----------------------------------------------------------------------- Municipal Sector Portfolio ----------------------------- Period from 08/21/2000 to 03/31/2001 Shares Amount Receipts for shares sold 6,697 $ 67,208 Issued as reinvestment of distributions 73 755 Cost of shares redeemed (380) (4,026) Net increase resulting from Portfolio share transactions 6,390 $ 63,937 ------------------------------------------------ ------------------------------
2001 Annual Report 59 7. Purchases and Sales of Securities Purchases and sales of investment securities (excluding short-term instruments) for the period ended March 31, 2001 were as follows (amounts in thousands):
U.S. Government/Agency All Other -------------------------------------------------------------------------------------------------------------------- Purchases Sales Purchases Sales -------------------------------------------------------------------------------------------------------------------- Short-Term Portfolio $ 360,675 $ 104,596 $ 183,306 $ 129,700 U.S. Government Sector Portfolio 13,667,725 12,444,387 383,841 112,138 Investment Grade Corporate Portfolio 688,377 584,467 1,098,717 568,369 High Yield Portfolio 235 0 862,424 661,791 Mortgage Portfolio 43,157,735 40,913,583 4,337,897 976,861 Asset-Backed Securities Portfolio 72,829 57,794 57,457 4,342 Real Return Bond Portfolio 798,430 582,437 76,713 15,335 International Portfolio 6,746,378 5,334,189 10,768,781 8,348,435 Emerging Markets Portfolio 0 0 827,628 904,721 Municipal Sector Portfolio 2,504 1,976 154,781 91,948
8. Transactions in Written Call and Put Options Transactions in written call and put options were as follows (amounts in thousands):
U.S. Government Investment Grade Mortgage International Municipal Sector Portfolio Corporate Portfolio Portfolio Portfolio Sector Portfolio ---------------------------------------------------------------------------------------------------------------------------- Premium ---------------------------------------------------------------------------------------------------------------------------- Balance at 03/31/2000 $ 383 $ 0 $ 182 $ 165 $ 0 Sales 22,330 702 4,471 5,316 169 Closing Buys (20,013) (702) (806) (844) (169) Expirations (696) 0 (3,847) (2,886) 0 Exercised 0 0 0 (145) 0 Balance at 03/31/2001 $ 2,004 $ 0 $ 0 $ 1,606 $ 0 ----------------------------------------------------------------------------------------------------------------------------
60 PIMCO Funds Report of Independent Accountants To the Trustees and Shareholders of the PIMCO Funds: Pacific Investment Management Series. In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations, of changes in net assets and of cash flows and the financial highlights present fairly, in all material respects, the financial position of the Short-Term Portfolio, U.S. Government Sector Portfolio, Investment Grade Corporate Portfolio, High Yield Portfolio, Mortgage Portfolio, Asset-Backed Securities Portfolio, Real Return Bond Portfolio, International Portfolio, Emerging Markets Portfolio, and Municipal Sector Portfolio (ten of the portfolios constituting the Private Account Portfolio Series of PIMCO Funds: Pacific Investment Management Series, hereafter referred to as the "Portfolios") at March 31, 2001, the results of each of their operations, the changes in each of their net assets and cash flows for the Short-Term Portfolio, U.S. Government Sector Portfolio, Real Return Bond Portfolio and International Portfolio and the financial highlights for each of the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Portfolios' management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with auditing standards generally accepted in the United States of America which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at March 31, 2001 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion. PricewaterhouseCoopers LLP Kansas City, Missouri May 23, 2001 2001 Annual Report 61 Federal Income Tax Information (unaudited) As required by the Internal Revenue Code regulations, shareholders must be notified within 60 days of the Trust's fiscal year end (March 31, 2001) regarding the status of the dividend received deduction for corporations. Dividend Received Deduction. Corporate shareholders are generally entitled to take the dividend received deduction on the portion of a Fund's dividend distribution that qualifies under tax law. The percentage of the following Fund's fiscal 2001 ordinary income dividends that qualifies for the corporate dividend received deduction is set forth below: High Yield Porfolio 0.71% For the benefit of shareholders of the Municipal Sector Portfolio, this is to inform you that 100.00% of the dividends paid by the Funds during its fiscal year qualify as exempt-interest dividends. Shareholders are advised to consult their own tax advisor with respect to the tax consequences of their investment in the Trust. In January 2002, you will be advised on IRS Form 1099-DIV as to the federal tax status of the dividends and distributions received by you in calendar year 2001. 62 PIMCO Funds Pacific Investment Management Company LLC (PIMCO) is responsible for the management and administration of the PIMCO Funds: Pacific Investment Management Series. Founded in 1971, PIMCO currently manages assets in excess of $219 billion on behalf of mutual fund and institutional clients located around the world. Renowned for its fixed income management expertise, PIMCO manages assets for many of the largest corporations, foundations, endowments, and governmental bodies in the United States and the world. Trustees and Officers Brent R. Harris Chairman and Trustee R. Wesley Burns President and Trustee Guilford C. Babcock Trustee E. Philip Cannon Trustee Vern O. Curtis Trustee J. Michael Hagan Trustee Thomas P. Kemp Trustee William J. Popejoy Trustee Garlin G. Flynn Secretary John P. Hardaway Treasurer Investment Adviser and Administrator Pacific Investment Management Company LLC 840 Newport Center Drive, Suite 300 Newport Beach, CA 92660 Custodian State Street Bank & Trust Company 801 Pennsylvania Kansas City, MO 64105 Transfer Agent National Financial Data Services 330 W. 9th Street, 4th Floor Kansas City, MO 64105 Counsel Dechert 1775 Eye Street, N.W. Washington, D.C. 20006-2401 Independent Accountants PricewaterhouseCoopers LLP 1055 Broadway Kansas City, MO 64105 [LOGO OF PIMCO FUNDS] 840 NEWPORT CENTER DRIVE, SUITE 300 NEWPORT BEACH, CA 92660 The Portfolios issue shares only in private placement transactions in accordance with Regulation D or other applicable exemptions under the Securities Act of 1933, as amended (the "Securities Act"). The enclosed Annual Report is not an offer to sell, or a solicitation of any offer to buy, any security to the public within the meaning of the Securities Act. This report is submitted for the general information of the shareholders of the PIMCO Funds: Private Account Portfolio Series. It is not authorized for distribution to prospective investors unless accompanied or preceded by an effective offering memorandum for the PIMCO Funds: Private Account Portfolio Series, which contains information covering its investment policies as well as other pertinent information. PIMCO Funds Distributors LLC 2187 Atlantic Street, Stamford, CT 06902 March 31, 2001 Annual Report Pacific Investment Management Series GNMA Fund Share Class European Convertible Fund A P I M C O --------- Funds Table of Contents Fund Summaries 2-3 Schedule of Investments 8-9 Fund Schedule of Fund Summary Investments GNMA Fund 2 8 European Convertible Fund 3 9 Financial Highlights 4 Statements of Assets and Liabilities 5 Statements of Operatons 6 Statements of Changes in Net Assets 7 Notes to Financial Statements 10 PIMCO GNMA Fund Performance & Statistics AVERAGE ANNUAL TOTAL RETURN For periods ended 3/31/01
1 year 3 years 5 years 10 years Inception (7/31/97) ----------------------------------------------------------------------------------------------------------------------------------- PIMCO GNMA Fund A Shares 12.61% 7.49% - - 7.67% ----------------------------------------------------------------------------------------------------------------------------------- PIMCO GNMA Fund A Shares (adjusted) 7.50% 5.84% - - 6.33% ----------------------------------------------------------------------------------------------------------------------------------- Merrill Lynch 1-3 Year Treasury Index 9.60% 6.44% - - - ----------------------------------------------------------------------------------------------------------------------------------- Lehman Brothers GNMA Index 11.93% 6.96% - - - ----------------------------------------------------------------------------------------------------------------------------------- Lipper U.S. Mortgage Fund Average 11.48% 6.08% - - - -----------------------------------------------------------------------------------------------------------------------------------
MATURITY PROFILE SECTOR BREAKDOWN QUALITY BREAKDOWN ------------------------------------------ -------------------------------------------- ----------------------------------------- 1-5 years 53% Mortgage-Backed Securities 57.7% AAA 85.2% ------------------------------------------ -------------------------------------------- ----------------------------------------- 5-10 years 36% U.S. Treasury Obligations 19.4% AA 5.3% ------------------------------------------ -------------------------------------------- ----------------------------------------- 10-20 years 9% Asset-Backed Securities 11.4% A 6.0% ------------------------------------------ -------------------------------------------- ----------------------------------------- 20-30 years 2% Short-Term Instruments 8.3% BBB 3.5% ------------------------------------------ -------------------------------------------- ----------------------------------------- Duration 3.5 years Other 3.2% ------------------------------------------ --------------------------------------------
CHANGE IN VALUE For periods ended 3/31/01 Fund Characteristics ---------------------------- GNMA Fund Objective: PIMCO Lehman Brothers GNMA Maximum total return, MONTH GNMA A Index consistent with ----------------------------------------------- preservation of capital 07/31/1997 $ 9,700 $10,000 and prudent investment 08/31/1997 9,732 9,979 management 09/30/1997 9,910 10,111 10/31/1997 10,000 10,217 Portfolio: 11/30/1997 10,021 10,248 12/31/1997 10,107 10,340 Primarily short and 01/31/1998 10,185 10,440 intermediate maturity 02/28/1998 10,231 10,464 mortgage-related fixed 03/31/1998 10,241 10,508 income securities issued 04/30/1998 10,274 10,569 by the Government National 05/31/1998 10,348 10,641 Mortgage Association 06/30/1998 10,423 10,686 07/31/1998 10,451 10,746 Duration Range: 08/31/1998 10,580 10,831 09/30/1998 10,705 10,959 1-7 years 10/31/1998 10,655 10,949 11/30/1998 10,611 11,011 Fund Inception Date: 12/31/1998 10,680 11,057 01/31/1999 10,757 11,135 7/31/97 02/28/1999 10,658 11,100 03/31/1999 10,783 11,167 Total Net Assets: 04/30/1999 10,832 11,221 05/31/1999 10,905 11,164 $10.0 million 06/30/1999 10,884 11,120 07/31/1999 10,892 11,047 Portfolio Manager: 08/31/1999 10,888 11,043 09/30/1999 11,005 11,221 Scott A. Mather 10/31/1999 11,036 11,287 11/30/1999 11,026 11,292 12/31/1999 10,942 11,270 01/31/2000 11,040 11,168 02/29/2000 11,122 11,311 03/31/2000 11,295 11,489 04/30/2000 11,270 11,479 05/31/2000 11,283 11,521 06/30/2000 11,411 11,733 07/31/2000 11,485 11,795 08/31/2000 11,588 11,974 09/30/2000 11,668 12,085 10/31/2000 11,772 12,174 11/30/2000 12,036 12,346 12/31/2000 12,166 12,521 01/31/2001 12,361 12,725 02/28/2001 12,586 12,783 03/31/2001 12,720 12,859 *Past performance is no guarantee of future results. The Fund must invest at least 65% of its assets in a diversified portfolio of securities of varying maturities issued by the Government National Mortgage Association ("GNMA"). PORTFOLIO INSIGHTS ----------------------------------------------- . 12.61% Annual return soundly outperforms benchmark and Lipper Category Average. . Strong bond market helped returns. . Extended duration, high quality, real return holdings are key drivers of performance. . Mortgages continue to remain an attractive high quality offering. 2 PIMCO Funds Annual Report 3.31.01 PIMCO European Convertible Fund Performance & Statistics CUMULATIVE TOTAL RETURN For periods ended 3/31/01
1 year 3 years 5 years 10 years Inception* (11/30/00) --------------------------------------------------------------------------------------------------------------------- PIMCO European Convertible Fund A Shares - - - - 0.07% --------------------------------------------------------------------------------------------------------------------- PIMCO European Convertible Fund A Shares (adjusted) - - - - -4.42% --------------------------------------------------------------------------------------------------------------------- Warburg European Convertible Index - - - - - ---------------------------------------------------------------------------------------------------------------------
MATURITY PROFILE SECTOR BREAKDOWN QUALITY BREAKDOWN ------------------------------------- ------------------------------------------ ------------------------- Less than 1 year 23% Convertible Bonds & Notes 69.8% AAA 28.6% ------------------------------------- ------------------------------------------ ------------------------- 1-5 years 24% Short-Term Instruments 24.8% AA 22.1% ------------------------------------- ------------------------------------------ ------------------------- 10-20 years 53% Other 5.4% A 30.1% ------------------------------------- ------------------------------------------ ------------------------- Duration 1.5 years BBB 19.2% ------------------------------------- -------------------------
*Inception returns are cumulative since the Fund Characteristics fund is less than 1 year old. Past performance ------------------------- is no guarantee of future results. The Fund may invest up to 40% of its assets in high Objective: yield securities rated B or higher by Moody's or S&P or, if unrated, determined by PIMCO to Maximum total return, consis- be of comparable quality. tent with prudent investment management Portfolio: PORTFOLIO INSIGHTS ------------------------------------------------ Primarily European convertible securities . The Fund was seeded on November 30, 2000, focusing on maximum total return. Fund Inception Date: . The Fund will normally invest at least 65% of its assets in a diversified portfolio of 11/30/00 European convertible securities. . As of March 31, 2001, the Fund had an average Total Net Assets: credit quality of AA-. . The Fund may invest its assets in securities $5.0 million denominated in any currency and may invest up to 35% of its assets in non-Europe holdings. Portfolio Manager: Sandra K. Durn 3.31.01 PIMCO Funds Annual Report 3 PIMCO Financial Highlights A Class Selected Per Share Data for the Period Ended:
GNMA Fund ----------------------------- Class A 11/30/2000-3/31/2001 (a) Net Asset Value Beginning of Period $ 10.13 ----------------------------------------------------- ----------------------------- Net Investment Income (a) 0.22 ----------------------------------------------------- ----------------------------- Net Realized and Unrealized Gain (Loss) (a) 0.30 ----------------------------------------------------- ----------------------------- Total Income (Loss) from Investment Operations 0.52 ----------------------------------------------------- ----------------------------- Dividends from Net Investment Income (0.21) ----------------------------------------------------- ----------------------------- Total Distributions (0.21) ----------------------------------------------------- ----------------------------- Net Asset Value End of Period $ 10.44 ----------------------------------------------------- ----------------------------- Total Return 5.68% ----------------------------------------------------- ----------------------------- Net Assets End of Period (000s) $ 11 ----------------------------------------------------- ----------------------------- Ratio of Expenses to Average Net Assets 0.65%* ----------------------------------------------------- ----------------------------- Ratio of Net Investment Income to Average Net Assets 6.11%* ----------------------------------------------------- ----------------------------- Portfolio Turnover Rate 808% ----------------------------------------------------- ----------------------------- European Convertible Fund ----------------------------- Class A 11/30/2000-3/31/2001 (a)(b) Net Asset Value Beginning of Period $ 10.00 ----------------------------------------------------- ----------------------------- Net Investment Income (a) 0.03 ----------------------------------------------------- ----------------------------- Net Realized and Unrealized Gain (Loss) (a) (0.02) ----------------------------------------------------- ----------------------------- Total Income (Loss) from Investment Operations 0.01 ----------------------------------------------------- ----------------------------- Dividends from Net Investment Income (0.04) ----------------------------------------------------- ----------------------------- Total Distributions (0.04) ----------------------------------------------------- ----------------------------- Net Asset Value End of Period $ 9.97 ----------------------------------------------------- ----------------------------- Total Return 0.07% ----------------------------------------------------- ----------------------------- Net Assets End of Period (000s) $ 10 ----------------------------------------------------- ----------------------------- Ratio of Expenses to Average Net Assets (b) 1.15%* ----------------------------------------------------- ----------------------------- Ratio of Net Investment Income to Average Net Assets 0.87%* ----------------------------------------------------- ----------------------------- Portfolio Turnover Rate 175% ----------------------------------------------------- -----------------------------
*Annualized (a) Per share amounts based on average number of shares outstanding during the period. (b) If the investment manager had not reimbursed expenses, the ratio of expenses to average net assets would have been 2.20%. 4 PIMCO Funds Annual Report 3.31.01 PIMCO Statements of Assets and Liabilities A Class March 31, 2001
European Convertible Amounts in thousands, except per share amounts GNMA Fund Fund ------------------- ------------------- Assets: Investments, at value $ 16,952 $ 4,806 --------------------------------------------------------------------------- ------------------- ------------------- Cash and foreign currency 16 6 --------------------------------------------------------------------------- ------------------- ------------------- Receivable for investments sold and forward foreign currency contracts 25,018 161 --------------------------------------------------------------------------- ------------------- ------------------- Receivable for Fund shares sold 40 0 --------------------------------------------------------------------------- ------------------- ------------------- Variation margin receivable 0 0 --------------------------------------------------------------------------- ------------------- ------------------- Interest and dividends receivable 116 26 --------------------------------------------------------------------------- ------------------- ------------------- Manager reimbursement receivable 0 0 --------------------------------------------------------------------------- ------------------- ------------------- Other assets 9 17 --------------------------------------------------------------------------- ------------------- ------------------- 42,151 5,016 ========================================================================== =================== =================== Liabilities: Payable for investments purchased and forward foreign currency contracts $ 29,061 $ 6 --------------------------------------------------------------------------- ------------------- ------------------- Payable for financing transactions 3,100 0 --------------------------------------------------------------------------- ------------------- ------------------- Due to Custodian 0 0 --------------------------------------------------------------------------- ------------------- ------------------- Notes Payable 0 0 --------------------------------------------------------------------------- ------------------- ------------------- Written options outstanding 0 0 --------------------------------------------------------------------------- ------------------- ------------------- Payable for Fund shares redeemed 2 0 --------------------------------------------------------------------------- ------------------- ------------------- Dividends payable 10 0 --------------------------------------------------------------------------- ------------------- ------------------- Accrued investment advisory fee 2 2 --------------------------------------------------------------------------- ------------------- ------------------- Accrued administration fee 2 1 --------------------------------------------------------------------------- ------------------- ------------------- Accrued distribution fee 0 0 --------------------------------------------------------------------------- ------------------- ------------------- Accrued servicing fee 0 0 --------------------------------------------------------------------------- ------------------- ------------------- Variation margin payable 0 0 --------------------------------------------------------------------------- ------------------- ------------------- Other liabilities 0 0 --------------------------------------------------------------------------- ------------------- ------------------- 32,177 9 ========================================================================== =================== =================== Net Assets $ 9,974 $ 5,007 ========================================================================== =================== =================== Net Assets Consist of: Paid in capital $ 9,473 $ 5,020 --------------------------------------------------------------------------- ------------------- ------------------- Undistributed (overdistributed) net investment income 302 94 --------------------------------------------------------------------------- ------------------- ------------------- Accumulated undistributed net realized gain (loss) (5) 0 --------------------------------------------------------------------------- ------------------- ------------------- Net unrealized appreciation (depreciation) 204 (107) --------------------------------------------------------------------------- ------------------- ------------------- $ 9,974 $ 5,007 ========================================================================== =================== =================== Net Assets: Class A $ 11 $ 10 --------------------------------------------------------------------------- ------------------- ------------------- Other Classes 9,963 4,997 --------------------------------------------------------------------------- ------------------- ------------------- Shares Issued and Outstanding: Class A 1 1 --------------------------------------------------------------------------- ------------------- ------------------- Net Asset Value and Redemption Price Per Share (Net Assets Per Share Outstanding) Class A $ 10.00 $ 9.97 --------------------------------------------------------------------------- ------------------- ------------------- Cost of Investments Owned $ 16,748 $ 5,013 ========================================================================== =================== =================== Cost of Foreign Currency Held $ 0 $ 7 ========================================================================== =================== ===================
3.31.01 PIMCO Funds Annual Report 5 PIMCO Statements of Operations A Class For the year ended March 31, 2001
European Amounts in thousands GNMA Fund Convertible Fund -------------------- -------------------- Investment Income: Interest $ 582 $ 30 --------------------------------------------------------------------------- -------------------- -------------------- Dividends, net of foreign taxes 0 2 --------------------------------------------------------------------------- -------------------- -------------------- Miscellaneous income 1 2 --------------------------------------------------------------------------- -------------------- -------------------- Total Income 583 34 =========================================================================== ==================== ==================== Expenses: Investment advisory fees 20 8 --------------------------------------------------------------------------- -------------------- -------------------- Administration fees 20 4 --------------------------------------------------------------------------- -------------------- -------------------- Distribution and/or servicing fees - Class A 0 0 --------------------------------------------------------------------------- -------------------- -------------------- Distribution and/or servicing fees - Other Classes 0 0 --------------------------------------------------------------------------- -------------------- -------------------- Trustees' fees 0 0 --------------------------------------------------------------------------- -------------------- -------------------- Organization costs 0 18 --------------------------------------------------------------------------- -------------------- -------------------- Interest expense 0 0 --------------------------------------------------------------------------- -------------------- -------------------- Miscellaneous 0 0 --------------------------------------------------------------------------- -------------------- -------------------- Total Expenses 40 30 --------------------------------------------------------------------------- -------------------- -------------------- Reimbursement by Manager 0 (17) --------------------------------------------------------------------------- -------------------- -------------------- Net Expenses 40 13 --------------------------------------------------------------------------- -------------------- -------------------- Net Investment Income 543 21 =========================================================================== ==================== ==================== Net Realized and Unrealized Gain (Loss): Net realized gain (loss) on investments 286 133 --------------------------------------------------------------------------- -------------------- -------------------- Net realized gain (loss) on futures contracts and written options 0 0 --------------------------------------------------------------------------- -------------------- -------------------- Net realized gain (loss) on foreign currency transactions 0 (40) --------------------------------------------------------------------------- -------------------- -------------------- Net change in unrealized appreciation (depreciation) on investments 290 (207) --------------------------------------------------------------------------- -------------------- -------------------- Net change in unrealized appreciation (depreciation) on futures contracts 0 0 and written options --------------------------------------------------------------------------- -------------------- -------------------- Net change in unrealized appreciation (depreciation) on translation of 0 100 assets and liabilities denominated in foreign currencies --------------------------------------------------------------------------- -------------------- -------------------- Net Gain 576 (14) --------------------------------------------------------------------------- -------------------- -------------------- Net Increase in Assets Resulting from Operations $ 1,119 $ 7 =========================================================================== ==================== ====================
6 PIMCO Funds Annual Report 3.31.01 PIMCO Statements of Changes in Net Assets A Class
European Convertible Amounts in thousands GNMA Fund Fund -------------------------------------------- -------------------- Year Ended Year Ended Period from Increase (Decrease) in Net Assets from: March 31,2001 March 31, 2000 November 30, 2000 to March 31, 2001 Operations: Net investment income $ 543 $ 260 $ 21 --------------------------------------------------- -------------------- -------------------- -------------------- Net realized gain (loss) 286 35 93 --------------------------------------------------- -------------------- -------------------- -------------------- Net change in unrealized appreciation (depreciation) 290 (86) (107) --------------------------------------------------- -------------------- -------------------- -------------------- Net increase (decrease) resulting from operations 1,119 209 7 =================================================== ==================== ==================== ==================== Distributions to Shareholders: From net investment income Class A 0 0 0 --------------------------------------------------- -------------------- -------------------- -------------------- Other Classes (510) (260) (20) --------------------------------------------------- -------------------- -------------------- -------------------- In excess of net investment income Class A 0 0 0 --------------------------------------------------- -------------------- -------------------- -------------------- Other Classes 0 0 0 --------------------------------------------------- -------------------- -------------------- -------------------- From net realized capital gains Class A 0 0 0 --------------------------------------------------- -------------------- -------------------- -------------------- Other Classes (54) 0 0 --------------------------------------------------- -------------------- -------------------- -------------------- In excess of net realized capital gains Class A 0 0 0 --------------------------------------------------- -------------------- -------------------- -------------------- Other Classes 0 0 0 --------------------------------------------------- -------------------- -------------------- -------------------- Total Distributions (564) (260) (20) =================================================== ==================== ==================== ==================== Fund Share Transactions: Receipts for shares sold Class A 10 0 10 --------------------------------------------------- -------------------- -------------------- -------------------- Other Classes 9,067 27 4,990 --------------------------------------------------- -------------------- -------------------- -------------------- Issued in reorganization Class A 0 0 0 --------------------------------------------------- -------------------- -------------------- -------------------- Other Classes 0 0 0 --------------------------------------------------- -------------------- -------------------- -------------------- Issued as reinvestment of distributions Class A 0 0 0 --------------------------------------------------- -------------------- -------------------- -------------------- Other Classes 530 261 20 --------------------------------------------------- -------------------- -------------------- -------------------- Cost of shares redeemed Class A 0 0 0 --------------------------------------------------- -------------------- -------------------- -------------------- Other Classes (4,496) (48) 0 --------------------------------------------------- -------------------- -------------------- -------------------- Net increase (decrease) resulting from Fund share 5,111 240 5,020 transactions --------------------------------------------------- -------------------- -------------------- -------------------- Total Increase (Decrease) in Net Assets 5,666 189 5,007 =================================================== ==================== ==================== ==================== Net Assets: Beginning of period 4,308 4,119 0 --------------------------------------------------- -------------------- -------------------- -------------------- End of period * $ 9,974 $ 4,308 $ 5,007 --------------------------------------------------- -------------------- -------------------- -------------------- *Including net undistributed (overdistributed) investment income of: $ 302 $ 39 $ 94 --------------------------------------------------- -------------------- -------------------- --------------------
3.31.01 PIMCO Funds Annual Report 7 Schedule of Investments GNMA Fund March 31, 2001 Principal Amount Value (000s) (000s) ------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCIES 5.3% ------------------------------------------------------------------------------- Small Business Administration 7.449% due 08/01/2010 $ 499 $ 527 ------------- Total U.S. Government Agencies 527 (Cost $500) ============= ------------------------------------------------------------------------------- U.S. TREASURY OBLIGATIONS 33.0% ------------------------------------------------------------------------------- Treasury Inflation Protected Securities (d) 3.250% due 07/15/2002 109 111 3.375% due 01/15/2007 (e) 2,210 2,235 3.625% due 01/15/2008 108 111 U.S. Treasury Strips 0.000% due 05/15/2013 (e) 1,600 838 ------------- Total U.S. Treasury Obligations 3,295 (Cost $3,261) ============= ------------------------------------------------------------------------------- MORTGAGE-BACKED SECURITIES 98.1% ------------------------------------------------------------------------------- Collateralized Mortgage Obligations 31.1% ABN AMRO Mortgage Corp. 6.750% due 04/25/2029 229 201 Countrywide Home Loans 6.500% due 02/25/2009 144 143 Fannie Mae 7.000% due 05/25/2006 75 75 6.000% due 11/18/2017 128 129 6.500% due 02/25/2019 725 728 7.000% due 09/25/2021 1,850 168 6.500% due 09/25/2023 293 278 Freddie Mac 6.500% due 11/25/2023 129 122 7.500% due 08/15/2029 854 165 General Electric Capital Mortgage Services, Inc. 6.750% due 06/25/2028 50 50 Government National Mortgage Association 7.500% due 09/16/2027 563 562 Residential Accredit Loans, Inc. 7.000% due 01/25/2028 474 477 ------------- 3,098 ============= Fannie Mae 1.0% 7.780% due 03/01/2018 (b) 42 44 9.000% due 07/01/2018 58 61 ------------- 105 ============= Federal Housing Administration 1.6% 7.430% due 03/01/2022 163 162 ------------- Freddie Mac 6.7% 6.655% due 06/01/2030 (b) 99 100 6.871% due 05/01/2019 (b) 60 61 8.137% due 09/01/2040 475 505 ------------- 666 ============= Government National Mortgage Association 56.3% 6.500% due 04/23/2031 (b) 1,000 1,000 7.375% due 05/20/2016-02/20/2026 (b)(c) 900 914 7.500% due 10/20/2030-04/23/2031 (b)(c) 2,139 2,184 7.625% due 12/20/2017 (b) 81 83 7.750% due 07/20/2018-08/20/2025 (b)(c) 270 276 8.000% due 05/21/2031 1,000 1,032 11.250% due 07/20/2015 117 129 ------------- 5,618 ============= Stripped Mortgage-Backed Securities 1.4% Hilton Hotel Pool Trust (IO) 1.000% due 10/01/2016 2,987 137 ------------- Total Mortgage-Backed Securities 9,786 (Cost $9,684) ============= Principal Amount Value (000s) (000s) ------------------------------------------------------------------------------- ASSET-BACKED SECURITIES 19.4% ------------------------------------------------------------------------------- Advanta Business Card Master Trust 6.457% due 04/20/2008 (b) $ 100 $ 102 Chase Funding Mortgage Loan Asset-Backed Certificates 7.330% due 10/25/2030 (b) 200 198 Conseco Finance 9.290% due 12/15/2029 500 529 CS First Boston Mortgage Securities Corp. 6.620% due 09/25/2009 12 12 Fingerhut Master Trust 6.487% due 02/15/2005 (b) 300 299 General Electric Capital Mortgage Services, Inc. 7.200% due 04/25/2029 292 280 Indymac Home Equity Loan Asset-Backed Trust 6.126% due 12/25/2031 (b) 200 202 NPF XII, Inc. 6.001% due 10/01/2003 (b) 300 300 The Money Store Home Equity Trust 6.345% due 11/15/2021 12 12 ------------- Total Asset-Backed Securities 1,934 (Cost $1,893) ============= ------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 14.2% ------------------------------------------------------------------------------- Commercial Paper 13.0% CBA (de) Finance 4.990% due 04/23/2001 300 299 General Electric Capital Corp. 4.970% due 04/04/2001 200 200 National Rural Utilities Cooperative Finance Corp. 4.880% due 05/25/2001 400 397 Swedbank, Inc. 5.150% due 04/25/2001 400 399 ------------- 1,295 ============= Repurchase Agreement 1.2% State Street Bank 4.600% due 04/02/2001 115 115 (Dated 03/30/2001. Collateralized by Freddie Mac 5.500% due 02/13/2004 valued at $121. Repurchase proceeds are $115.) ------------- Total Short-Term Instruments 1,410 (Cost $1,410) ============= Total Investments (a) 170.0% $ 16,952 (Cost $16,748) Other Assets and Liabilities (Net) (70.0%) (6,978) ------------- Net Assets 100.0% $ 9,974 ============= Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $16,747 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 259 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (54) ------------- Unrealized appreciation-net $ 205 ============= (b) Variable rate security. The rate listed is as of March 31, 2001. (c) Securities are grouped by coupon or range of coupons and represent a range of of maturities. (d) Principal amount of the security is adjusted for inflation. (e) Subject to financing transaction. 8 PIMCO Funds Annual Report 3.31.01 Schedule of Investments European Convertible Bond March 31, 2001 Principal Amount Value (000s) (000s) ------------------------------------------------------------------------------- CONVERTIBLE BONDS & NOTES (b)(c) 67.1% ------------------------------------------------------------------------------- Banking & Finance 24.5% Axa 2.500% due 01/01/2014 EC 165 $ 144 Fortis (NL) NV 1.500% due 07/29/2004 200 183 Swiss America Holdings 2.250% due 06/10/2004 $ 150 149 Swiss Life Finance Ltd. 2.000% due 05/20/2003 200 202 0.750% due 05/20/2005 250 143 2.000% due 05/20/2005 200 205 Verizon Global Funding Corp. 4.250% due 09/15/2005 200 202 ---------- 1,228 ========== Health Care 5.9% Roche Holdings, Inc. 0.000% due 04/20/2010 200 113 0.000% due 01/19/2015 250 183 ---------- 296 ========== Industrial 33.3% Finmeccanica SpA 2.000% due 06/08/2005 EC 200 171 France Telecom 4.125% due 11/29/2004 250 210 Hutchison Whampoa International 2.875% due 09/15/2003 $ 200 193 Koninklijke Ahold NV 4.000% due 05/19/2005 EC 150 157 Nestle Australia Ltd. 1.250% due 04/27/2005 $ 200 192 Siemens Nederland NV 1.000% due 08/10/2005 EC 200 161 Tecnost International NV 1.000% due 11/03/2005 200 175 Usinor 3.875% due 01/01/2005 248 215 Vivendi Universal 1.250% due 01/01/2004 226 192 ---------- 1,666 ========== Technology 3.4% STMicroelectronics NV 0.000% due 11/16/2010 $ 250 168 ---------- Total Convertible Bonds & Notes 3,358 (Cost $3,523) ========== ------------------------------------------------------------------------------- CONVERTIBLE PREFERRED STOCK 3.3% ------------------------------------------------------------------------------- Shares Utilities 3.3% MediaOne Group, Inc. Cvt. Pfd. 0.000% due 2,500 165 ---------- Total Convertible Preferred Stock 165 (Cost $209) ========== ------------------------------------------------------------------------------- COMMON STOCKS 1.9% ------------------------------------------------------------------------------- Health Care 1.9% Elan Corp. PLC 1,815 93 ---------- Total Common Stocks 93 (Cost $92) ========== Principal Amount Value (000s) (000s) ------------------------------------------------------------------------------- SHORT-TERM INSTRUMENTS 23.7% ------------------------------------------------------------------------------- Commercial Paper 19.9% Abbey National North America 5.060% due 08/01/2001 $ 200 $ 197 CBA (de) Finance 5.040% due 04/23/2001 100 100 CDC 5.450% due 04/11/2001 300 300 General Electric Capital Corp. 5.070% due 04/04/2001 200 200 KFW International Finance, Inc. 5.340% due 04/24/2001 200 199 ---------- 996 ========== Repurchase Agreement 3.8% State Street Bank 4.600% due 04/02/2001 194 194 (Dated 03/30/2001. Collateralized by Fannie Mae 0.000% due 04/17/2001 valued at $200. Repurchase proceeds are $194.) ---------- Total Short-Term Instruments 1,189 (Cost $1,189) ========== Total Investments (a) 96.0% $ 4,806 (Cost $5,013) Other Assets and Liabilities (Net) 4.0% 201 ---------- Net Assets 100.0% $ 5,007 ========== Notes to Schedule of Investments (amounts in thousands): (a) At March 31, 2001, the net unrealized appreciation (depreciation) of investments based on cost for federal income tax purposes of $5,013 was as follows: Aggregate gross unrealized appreciation for all investments in which there was an excess of value over tax cost. $ 25 Aggregate gross unrealized depreciation for all investments in which there was an excess of tax cost over value. (232) ---------- Unrealized depreciation-net $ (207) ========== (b) Foreign forward currency contracts outstanding at March 31, 2001: Principal Amount Unrealized Covered by Settlement Appreciation/ Type Currency Contract Month (Depreciation) ---------------------------------------------------------------------------- Buy EC 1,875 04/2001 $ (6) Sell 1,875 04/2001 99 Sell 1,875 06/2001 7 Sell SF 257 05/2001 1 --------- $ 101 ========= (c) Principal amount denoted in indicated currency: EC - Euro SF - Swiss Franc 3.31.01 PIMCO Funds Annual Report 9 PIMCO Notes to Financial Statements A Class March 31, 2001 1. Organization PIMCO Funds: Pacific Investment Management Series (the "Trust") was established as a Massachusetts business trust on February 19, 1987. The Trust is registered under the Investment Company Act of 1940 (the "Act"), as amended, as an open-end investment management company. The Trust currently consists of 39 separate investment funds (the "Funds"). The Trust may offer up to six classes of shares: Institutional, Administrative, A, B, C and D. Each share class has identical voting rights (except that shareholders of a class have exclusive voting rights regarding any matter relating solely to that class of shares). Information presented in these financial statements pertains to the A Class of the Trust. Certain detailed financial information for the Institutional, Administrative, Retail, and D Classes (the "Other Classes") is provided separately and is available upon request. 2. Significant Accounting Policies The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America. The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America 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. Security Valuation. Portfolio securities and other financial instruments for which market quotations are readily available are stated at market value. Market value is determined on the basis of last reported sales prices, or if no sales are reported, as is the case for most securities traded over-the-counter, the mean between representative bid and asked quotations obtained from a quotation reporting system or from established market makers. Fixed income securities, including those to be purchased under firm commitment agreements, are normally valued on the basis of quotes obtained from brokers and dealers or pricing services. Short-term investments which mature in 60 days or less are valued at amortized cost, which approximates market value. Certain fixed income securities for which daily market quotations are not readily available may be valued, pursuant to guidelines established by the Board of Trustees, with reference to fixed income securities whose prices are more readily obtainable. Securities Transactions and Investment Income. Securities transactions are recorded as of the trade date. Securities purchased or sold on a when-issued or delayed-delivery basis may be settled a month or more after the trade date. Realized gains and losses from securities sold are recorded on the identified cost basis. Dividend income is recorded on the ex-dividend date, except certain dividends from foreign securities where the ex-dividend date may have passed, are recorded as soon as the Fund is informed of the ex-dividend date. Interest income, adjusted for the accretion of discounts and amortization of premiums, is recorded on the accrual basis. Dividends and Distributions to Shareholders. Dividends from net investment income, if any, of each Fund, except the European Convertible Fund, are declared on each day the Trust is open for business and are distributed to shareholders monthly. Dividends from net investment income, if any, of the European Convertible Fund, are declared and distributed to shareholders quarterly. Net realized capital gains earned by a Fund, if any, will be distributed no less frequently than once each year. Income dividends and capital gain distributions are determined in accordance with income tax regulations which may differ from accounting principles generally accepted in the United States of America. These differences are primarily due to differing treatments for such items as wash sales, foreign currency transactions, net operating losses and capital loss carryforwards. Distributions reflected as a tax basis return of capital in the accompanying Statements of Changes in Net Assets have been reclassified to paid in capital. In addition, other amounts have been reclassified between undistributed net investment income, accumulated undistributed net realized gains or losses and paid in capital to more appropriately conform financial accounting to tax characterizations of dividends and distributions. Foreign Currency. Foreign currencies, investments, and other assets and liabilities are translated into U.S. dollars at the exchange rates prevailing at the end of the period. Fluctuations in the value of these assets and liabilities resulting from changes in exchange rates are recorded as unrealized foreign currency gains (losses). Realized gains (losses) and unrealized appreciation (depreciation) on investment securities and income and expenses are translated on the respective dates of such transactions. The effect of changes in foreign currency exchange rates on investments in securities are not segregated in the Statements of Operations from the effects of changes in market prices of those securities, but are included with the net realized and unrealized gain or loss on investment securities. Multiclass Operations. Each class offered by the Trust has equal rights as to assets and voting privileges. Income and non-class specific expenses of each Fund, except the European Convertible Fund, are allocated daily to each class of shares based on the relative value of settled shares. Income and non-class specific expenses of the European Convertible Fund are allocated daily to each 10 PIMCO Funds Annual Report 3.31.01 class of shares based on the relative net assets of each class. Realized and unrealized capital gains and losses of each Fund are allocated daily to each class of shares based on the relative net assets of each class. Federal Income Taxes. Each Fund intends to qualify as a regulated investment company and distribute all of its taxable income and net realized gains, if applicable, to shareholders. Accordingly, no provision for Federal income taxes has been made. Financing Transactions. Certain Funds may enter into financing transactions consisting of the sale by the Fund of securities, together with a commitment to repurchase similar securities at a future date. The difference between the selling price and the future purchase price is an adjustment to interest income. If the counterparty to whom the Fund sells the security becomes insolvent, a Fund's right to repurchase the security may be restricted; the value of the security may change over the term of the financing transaction; and the return earned by a Fund with the proceeds of a financing transaction may not exceed transaction costs. Forward Currency Transactions. Certain Funds are authorized to enter into forward foreign exchange contracts for the purpose of hedging against foreign exchange risk arising from the Fund's investment or anticipated investment in securities denominated in foreign currencies. A Fund also may enter into these contracts for purposes of increasing exposure to a foreign currency or to shift exposure to foreign currency fluctuations from one country to another. All commitments are marked to market daily at the applicable translation rates and any resulting unrealized gains or losses are recorded. Realized gains or losses are recorded at the time the forward contract matures or by delivery of the currency. Risks may arise upon entering these contracts from the potential inability of counterparties to meet the terms of their contracts and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. Stripped Mortgage Backed Securities (SMBS). SMBS represent a participation in, or are secured by and payable from, mortgage loans on real property, and may be structured in classes with rights to receive varying proportions of principal and interest. SMBS include interest-only securities (IOs), which receive all of the interest, and principal-only securities (POs), which receive all of the principal. If the underlying mortgage assets experience greater than anticipated payments of principal, a Fund may fail to recoup some or all of its initial investment in these securities. The market value of these securities is highly sensitive to changes in interest rates. Delayed Delivery Transactions. Certain Funds may purchase or sell securities on a when-issued or delayed delivery basis. These transactions involve a commitment by a Fund to purchase or sell securities for a predetermined price or yield, with payment and delivery taking place beyond the customary settlement period. When delayed delivery purchases are outstanding, a Fund will set aside and maintain until the settlement date in a segregated account, liquid assets in an amount sufficient to meet the purchase price. When purchasing a security on a delayed delivery basis, a Fund assumes the rights and risks of ownership of the security, including the risk of price and yield fluctuations, and takes such fluctuations into account when determining its net asset value. A Fund may dispose of or renegotiate a delayed delivery transaction after it is entered into, and may sell when-issued securities before they are delivered, which may result in a capital gain or loss. When the Fund has sold a security on a delayed delivery basis, the Fund does not participate in future gains and losses with respect to the security. Forward sales commitments are accounted for by the Fund in the same manner as forward currency contracts discussed above. Inflation-Indexed Bonds. Inflation-indexed bonds are fixed income securities whose principal value is periodically adjusted according to the rate of inflation. The interest rate on these bonds is generally fixed at issuance at a rate lower than typical bonds. Over the life of an inflation-indexed bond, however, interest will be paid based on a principal value which is adjusted for inflation. Any increase in the principal amount of an inflation-indexed bond will be considered interest income, even though principal is not received until maturity. Repurchase Agreements. Each Fund may engage in repurchase transactions. Under the terms of a typical repurchase agreement, the Fund takes possession of an underlying debt obligation subject to an obligation of the seller to repurchase, and the Fund to resell, the obligation at an agreed-upon price and time. The market value of the collateral must be equal at all times to the total amount of the repurchase obligations, including interest. Generally, in the event of counterparty default, the Fund has the right to use the collateral to offset losses incurred. 3. Fees, Expenses, and Related Party Transactions Investment Advisory Fee. Pacific Investment Management Company (PIMCO) is a wholly-owned subsidiary partnership of PIMCO Advisors L.P. and serves as investment adviser (the "Adviser") to the Trust, pursuant to an investment advisory contract. The Adviser receives a monthly fee from each Fund at an annual rate based on average daily net assets of the Fund. The Advisory Fee is charged at an annual rate of 0.50% for the European Convertible Fund and 0.25% for the GNMA Fund. 3.31.01 PIMCO Funds Annual Report 11 PIMCO Notes to Financial Statements A Class (Cont.) March 31, 2001 Administration Fee. PIMCO serves as administrator (the "Administrator"), and provides administrative services to the Trust for which it receives from each Fund a monthly administrative fee based on each share class' average daily net assets. The Administration Fee for Class A is charged at the annual rate of 0.40% for the European Convertible and GNMA Funds. Distribution and Servicing Fees. PIMCO Funds Distributors LLC, ("PFD"), a wholly-owned subsidiary of PIMCO Advisors L.P., serves as the distributor of the Trust's shares. The Trust is permitted to reimburse, out of the Administrative Class assets of each Fund offering Administrative Class shares in an amount up to 0.25% on an annual basis of the average daily net assets of that class, financial intermediaries that provide services in connection with the distribution of shares or administration of plans or programs that use Fund shares as their funding medium. The effective rate paid to PFD was 0.25% during the current fiscal year. Pursuant to the Distribution and Servicing Plans adopted by the Retail and D Classes of the Trust, the Trust compensates PFD or an affiliate with respect to Class D for services provided and expenses incurred in connection with assistance rendered in the sale of shares and services rendered to shareholders and for maintenance of shareholder accounts of the Retail and D Classes. The Trust paid PFD distribution and servicing fees at an effective rate as set forth below (calculated as a percentage of each Fund's average daily net assets attributable to each class): Distribution Fee (%) Servicing Fee (%) ---------------------------------------------------------------------- Class A All Funds -- 0.25 Expenses. The Trust is responsible for the following expenses: (i) salaries and other compensation of any of the Trust's executive officers and employees who are not officers, directors, stockholders or employees of PIMCO or its subsidiaries or affiliates; (ii) taxes and governmental fees; (iii) brokerage fees and commissions and other portfolio transaction expenses; (iv) the costs of borrowing money, including interest expenses; (v) fees and expenses of the Trustees who are not "interested persons" of PIMCO or the Trust, and any counsel retained exclusively for their benefit; (vi) extraordinary expenses, including costs of litigation and indemnification expenses; (vii) organization expense and (viii) any expenses allocated or allocable to a specific class of shares, which include service fees payable with respect to the Administrative Class shares and may include certain other expenses as permitted by the Trust's Multiple Class Plan adopted pursuant to Rule 18f-3 under the Act and subject to review and approval by the Trustees. The ratio of expenses to average net assets per share class, as disclosed in Financial Highlights, may differ from the annual fund operating expenses per share class as disclosed in the Prospectus for the reasons set forth above. PIMCO has agreed to waive a portion of the European Convertible Fund administrative fees to the extent that the payment of the Fund's pro rata share of Trustee fees and organizational expenses cause the actual expense ratio to rise above the rates disclosed in the current prospectus plus 0.49% basis points as set forth below (calculated as a percentage of the Fund's average daily net assets attributable to each class):
Inst'l Admin. Class Class Class A Class B Class C Class D ----------------------------------------------------------------------------------------- European Convertible Fund 0.75% 1.00% 1.15% - - 1.05%
PIMCO may be reimbursed for these waived amounts in future periods. Each unaffiliated Trustee receives an annual retainer of $45,000**, plus $3,000 for each Board of Trustees meeting attended in person and $500 for each meeting attended telephonically, plus reimbursement of related expenses. In addition, each committee chair receives an annual retainer of $1,500. These expenses are allocated to the Funds of the Trust according to their respective net assets. ** Effective January 1, 2001, the annual retainer for the unaffiliated Trustee is equal to $60,000. 12 PIMCO Funds Annual Report 3.31.01 4. Purchases and Sales of Securities Purchases and sales of securities (excluding short-term investments) for the period ended March 31, 2001 were as follows (amounts in thousands): U.S. Government/Agency All Other ---------------------------------------------------- Purchases Sales Purchases Sales ------------------------------------------------------------------------------- European Convertible Fund $ 0 $ 0 $8,881 $6,292 GNMA Fund 132,021 125,324 3,379 531 5. Acquisition by Allianz AG On May 5, 2000, Allianz AG completed the acquisition of approximately 70% of the outstanding partnership interest in PIMCO Advisors L.P. ("PIMCO Advisors"), of which PIMCO is a subsidiary partnership. As a result of this transaction, PIMCO Advisors, and its subsidiaries, are now controlled by Allianz AG, a leading provider of financial services, particularly in Europe. PIMCO remains operationally independent, continues to operate under its existing name, and now leads the global fixed-income efforts of Allianz AG. Key employees at each PIMCO Advisors' investment units, including PIMCO's Bill Gross, have signed long-term employment contracts and have significant profit-sharing and retention arrangements to ensure continuity of the investment process and staff. The Allianz Group manages assets of approximately (Euro dollar)713.3 billion as of December 31, 2000, including more than 300 mutual funds for retail and institutional clients around the world. 6. Federal Income Tax Matters As of March 31, 2001, the GNMA Fund realized capital losses and/or foreign currency losses during the period November 1, 2000 through March 31, 2001 which the Fund elected to defer to the following fiscal year pursuant to income tax regulations. The amount was $4,945. The Fund will resume capital gain distributions in the future to the extent gains are realized in excess of the available carryforwards. 3.31.01 PIMCO Funds Annual Report 13 PIMCO Notes to Financial Statements A Class (Cont.) March 31, 2001 7. Shares of Beneficial Interest The Trust may issue an unlimited number of shares of beneficial interest with a $.0001 par value. Changes in shares of beneficial interest were as follows (shares and amounts in thousands):
European GNMA Fund Convertible Fund --------------------------------------------- ------------------------ Year Ended Year Ended Period from 03/31/2001 03/31/2000 11/30/2000 to 03/31/2001 Shares Amount Shares Amount Shares Amount --------------------------------------------------- --------------------------------------------- ------------------------ Receipts for shares sold Class A 1 $ 10 0 $ 0 1 $ 10 --------------------------------------------------- --------------------------------------------- ------------------------ Other Classes 908 9,067 3 27 499 4,990 --------------------------------------------------- --------------------------------------------- ------------------------ Shares issued in reorganization Class A 0 0 0 0 0 0 --------------------------------------------------- --------------------------------------------- ------------------------ Other Classes 0 0 0 0 0 0 --------------------------------------------------- --------------------------------------------- ------------------------ Issued as reinvestment of distributions Class A 0 0 0 0 0 0 --------------------------------------------------- --------------------------------------------- ------------------------ Other Classes 53 530 26 261 2 20 --------------------------------------------------- --------------------------------------------- ------------------------ Cost of shares redeemed Class A 0 0 0 0 0 0 --------------------------------------------------- --------------------------------------------- ------------------------ Other Classes (441) (4,496) (5) (48) 0 0 --------------------------------------------------- --------------------------------------------- ------------------------ Net increase resulting from Fund share transactions 521 $ 5,111 24 $240 502 $5,020 =================================================== ============================================= ========================
14 PIMCO Funds Annual Report 3.31.01 PIMCO Report of Independent Accountants A Class To the Trustees and Class A Shareholders of the PIMCO Funds: Pacific Investment Management Series In our opinion, the accompanying statements of assets and liabilities, including the schedules of investments, and the related statements of operations, of changes in net assets and of the financial highlights for the Class A shares present fairly, in all material respects, the financial position of the GNMA Fund and the European Convertible Fund (hereafter referred to as the "Funds") at March 31, 2001, the results of each of their operations, the changes in each of their net assets and the financial highlights for the Class A shares for each of the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Funds' management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with auditing standards generally accepted in the United States of America which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at March 31, 2001 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion. PricewaterhouseCoopers LLP Kansas City, Missouri May 23, 2001 3.31.01 PIMCO Funds Annual Report 15