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DWS Closed-End Funds Announce Extension of Share Repurchase Programs
Rhea-AI Impact
(Low)
Rhea-AI Sentiment
(Negative)
Tags
buyback
Rhea-AI Summary
DWS Municipal Income Trust (NYSE: KTF) and DWS Strategic Municipal Income Trust (NYSE: KSM) have extended their open market share repurchase programs for another twelve months, from December 1, 2021 to November 30, 2022. The Funds will repurchase shares trading at a discount to their net asset value (NAV), with the exact timing and amount determined by DWS Investment Management Americas, considering prevailing market conditions. This continued buyback is expected to enhance shareholder value by potentially increasing NAV per share.
Positive
Extension of share repurchase programs may enhance net asset value (NAV) per share.
Buying shares at a discount could increase shareholder value.
Negative
None.
NEW YORK--(BUSINESS WIRE)--
DWS Municipal Income Trust (NYSE: KTF) and DWS Strategic Municipal Income Trust (NYSE: KSM) (each, a “Fund,” and collectively, the “Funds”) each announced today that its respective Board of Trustees has extended the Fund’s existing open market share repurchase program for an additional twelve-month period. Each Fund may continue to purchase outstanding shares of beneficial interest in open-market transactions over the twelve-month period from December 1, 2021 until November 30, 2022 when the Fund’s shares trade at a discount to net asset value (“NAV”). The amount and timing of the repurchases will be at the discretion of DWS Investment Management Americas, Inc. (“DIMA”), the Funds’ investment adviser, and subject to market conditions and investment considerations. DIMA will seek to purchase shares at prices that will be accretive to each Fund’s NAV.
The authorization of the extension of the Funds’ repurchase programs follows the previous repurchase programs, which commenced on December 1, 2020 and run until November 30, 2021. Results of repurchases under each Fund’s program appear in the Fund’s shareholder reports.
For more information on each Fund visit dws.com or call (800) 349-4281.
Important Information
DWS Municipal Income Trust. Bond investments are subject to interest-rate, credit, liquidity and market risks to varying degrees. When interest rates rise, bond prices generally fall. Credit risk refers to the ability of an issuer to make timely payments of principal and interest. Municipal securities are subject to the risk that litigation, legislation or other political events, local business or economic conditions or the bankruptcy of the issuer could have a significant effect on an issuer’s ability to make payments of principal and/or interest. The market for municipal bonds may be less liquid than for taxable bonds and there may be less information available on the financial condition of issuers of municipal securities than for public corporations. Investing in derivatives entails special risks relating to liquidity, leverage and credit that may reduce returns and/or increase volatility. Leverage results in additional risks and can magnify the effect of any gains or losses. Although the fund seeks income that is exempt from federal income taxes, a portion of the fund’s distributions may be subject to federal, state and local taxes, including the alternative minimum tax.
DWS Strategic Municipal Income Trust. Bond investments are subject to interest-rate, credit, liquidity and market risks to varying degrees. When interest rates rise, bond prices generally fall. Credit risk refers to the ability of an issuer to make timely payments of principal and interest. Municipal securities are subject to the risk that litigation, legislation or other political events, local business or economic conditions or the bankruptcy of the issuer could have a significant effect on an issuer’s ability to make payments of principal and/or interest. The market for municipal bonds may be less liquid than for taxable bonds and there may be less information available on the financial condition of issuers of municipal securities than for public corporations. Investing in derivatives entails special risks relating to liquidity, leverage and credit that may reduce returns and/or increase volatility. Leverage results in additional risks and can magnify the effect of any gains or losses. Although the fund seeks income that is exempt from federal income taxes, a portion of the fund’s distributions may be subject to federal, state and local taxes, including the alternative minimum tax.
Closed-end funds, unlike open-end funds, are not continuously offered. There is a one-time public offering and once issued, shares of closed-end funds are bought and sold in the open market through a stock exchange. Shares of closed-end funds frequently trade at a discount to the net asset value. The price of a fund’s shares is determined by a number of factors, several of which are beyond the control of the fund. Therefore, the fund cannot predict whether its shares will trade at, below or above net asset value.
Past performance is no guarantee of future results.
This press release shall not constitute an offer to sell or a solicitation to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer or solicitation or sale would be unlawful prior to registration or qualification under the laws of such state or jurisdiction.
War, terrorism, economic uncertainty, trade disputes, public health crises (including the recent pandemic spread of the novel coronavirus) and related geopolitical events could lead to increased market volatility, disruption to US and world economies and markets and may have significant adverse effects on the funds and their investments.
NOT FDIC/ NCUA INSURED • MAY LOSE VALUE • NO BANK GUARANTEE
NOT A DEPOSIT • NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY
The brand DWS represents DWS Group GmbH & Co. KGaA and any of its subsidiaries such as DWS Distributors, Inc. which offers investment products or DWS Investment Management Americas, Inc. and RREEF America L.L.C. which offer advisory services. (R-085543-1) (09/21)
What is the duration of the extended share repurchase program for KTF and KSM?
The share repurchase program for DWS Municipal Income Trust (KTF) and DWS Strategic Municipal Income Trust (KSM) has been extended for twelve months, from December 1, 2021, until November 30, 2022.
Why are KTF and KSM extending their share repurchase programs?
The extension is aimed at buying back shares that trade at a discount to net asset value (NAV), potentially enhancing shareholder value.
When did the previous share repurchase program for KTF and KSM start?
The previous share repurchase program for both Funds commenced on December 1, 2020.
What is the intention behind the buyback program for KTF and KSM?
The intention is to purchase shares at prices that are accretive to each Fund's NAV.
