Templeton Emerging Markets Income Fund (“TEI” or the “Fund”) Announces Distribution

Rhea-AI Summary

Templeton Emerging Markets Income Fund (TEI) has announced a monthly distribution of $0.0475 per share, payable on February 28, 2025, to shareholders of record on February 18, 2025. The Fund's Board has implemented a managed distribution plan to maintain consistent monthly payments and potentially narrow the discount between market price and NAV.

The Fund aims to generate distributions primarily from net ordinary income and short-term capital gains. When insufficient income is available, distributions may include long-term capital gains or return of capital. The Fund's current year capital gains might be offset by prior years' capital loss carryovers. Franklin Templeton, the parent company, manages over $1.6 trillion in assets as of December 31, 2024, with operations in over 150 countries.

Positive

• Fixed monthly distribution of $0.0475 per share provides steady income stream
• Strategic plan implemented to reduce NAV discount
• Parent company Franklin Templeton manages substantial $1.6 trillion AUM

Negative

• Distributions may include return of capital, potentially returning investors' principal
• Fund may use capital loss carryovers, indicating previous investment losses
• No guarantee the plan will successfully narrow the NAV discount

Insights

Fixed Income Analyst

The announced $0.0475 monthly distribution represents a standardized approach to income distribution, which is particularly noteworthy in the current emerging markets fixed income landscape. The managed distribution plan reflects a sophisticated balance between providing predictable income and managing the fund's market positioning.

Several key aspects warrant attention:

• The fund's commitment to maintaining a fixed distribution rate, regardless of underlying income generation, suggests a focus on reducing NAV discount through consistent payouts - a strategy that can be particularly valuable in emerging markets where income streams can be volatile.
• The flexibility to source distributions from various channels (income, capital gains, or return of capital) provides important strategic advantages but requires careful monitoring from a tax efficiency perspective. Return of capital distributions, while maintaining payout consistency, effectively return investors' principal and may impact the fund's long-term capital base.
• Franklin Templeton's substantial $1.6 trillion AUM and extensive emerging markets expertise provide significant advantages in security selection and market access, potentially helping to optimize the fund's income generation potential while managing risks inherent to emerging markets debt.

For income-focused investors, the managed distribution plan offers predictability but requires understanding that not all distributions may represent true investment income. The strategy's success in narrowing the NAV discount will largely depend on market conditions and investor sentiment toward emerging markets debt.

FORT LAUDERDALE, Fla.--(BUSINESS WIRE)-- Templeton Emerging Markets Income Fund [NYSE: TEI] today announced a monthly distribution from net investment income of $0.0475 per share, payable on February 28, 2025, to shareholders of record on February 18, 2025 (Ex-Dividend Date: February 18, 2025).

The Fund’s Board of Trustees (the “Board”) has authorized a managed distribution plan (the “Plan”) pursuant to which the Fund makes monthly distributions to shareholders at the fixed rate of $0.0475 per share. The Plan is intended to provide shareholders with consistent distributions each month and is intended to narrow the discount between the market price and the net asset value (“NAV”) of the Fund’s common shares, but there can be no assurance that the Plan will be successful in doing so. The Fund is managed with a goal of generating as much of the distribution as possible from net ordinary income and short-term capital gains, that is consistent with the Fund’s investment strategy and risk profile. To the extent that sufficient distributable income is not available on a monthly basis, the Fund will distribute long-term capital gains and/or return of capital in order to maintain its managed distribution rate. A return of capital may occur, for example, when some or all of the money that was invested in the Fund is paid back to shareholders. A return of capital distribution does not necessarily reflect the Fund’s investment performance and should not be confused with “yield” or “income”. Even though the Fund may realize current year capital gains, such gains may be offset, in whole or in part, by the Fund’s capital loss carryovers from prior years.

The Board may amend the terms of the Plan or terminate the Plan at any time without prior notice to the Fund’s shareholders. The amendment or termination of the Plan could have an adverse effect on the market price of the Fund’s common shares. The Plan will be subject to the periodic review by the Board, including a yearly review of the fixed rate to determine if an adjustment should be made.

Shareholders should not draw any conclusions about the Fund’s investment performance from the amount of the current distribution or from the terms of the Plan. The amounts and sources of distributions reported herein are only estimates and are not being provided for tax reporting purposes. The actual amounts and sources of the amounts for tax reporting purposes will depend upon the Fund’s investment experience during the remainder of its fiscal year and may be subject to changes based on tax regulations. The Fund will send a Form 1099-DIV to shareholders for the calendar year that will describe how to report the Fund’s distributions for federal income tax purposes.

For further information on Templeton Emerging Markets Income Fund, please visit our web site at: www.franklintempleton.com

Franklin Resources, Inc. is a global investment management organization with subsidiaries operating as Franklin Templeton and serving clients in over 150 countries. Franklin Templeton’s mission is to help clients achieve better outcomes through investment management expertise, wealth management and technology solutions. Through its specialist investment managers, the company offers specialization on a global scale, bringing extensive capabilities in fixed income, equity, alternatives and multi-asset solutions. With more than 1,500 investment professionals, and offices in major financial markets around the world, the California-based company has over 75 years of investment experience and over $1.6 trillion in assets under management as of December 31, 2024. For more information, please visit franklintempleton.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250207564197/en/

For more information, please contact Franklin Templeton at 1-800-342-5236.

Source: Franklin Templeton

FAQ

What is the monthly distribution amount for TEI announced for February 2025?

TEI announced a monthly distribution of $0.0475 per share, payable on February 28, 2025, to shareholders of record on February 18, 2025.

How does TEI's managed distribution plan work?

TEI's managed distribution plan provides fixed monthly distributions of $0.0475 per share, aiming to provide consistent income and narrow the discount between market price and NAV.

What are the sources of TEI's monthly distributions?

TEI aims to generate distributions primarily from net ordinary income and short-term capital gains, but may also include long-term capital gains or return of capital when necessary.

When is the ex-dividend date for TEI's February 2025 distribution?

The ex-dividend date for TEI's February 2025 distribution is February 18, 2025.

How will TEI shareholders receive tax information about distributions?

TEI will send shareholders a Form 1099-DIV for the calendar year detailing how to report the Fund's distributions for federal income tax purposes.