nq-gim_pe053116.htm - Generated by SEC Publisher for SEC Filing

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

 

FORM N-Q

 

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF

REGISTERED MANAGEMENT INVESTMENT COMPANY

 

 

Investment Company Act file number 811-05459

 

Templeton Global Income Fund

(Exact name of registrant as specified in charter)

 

300 S.E. 2nd Street, Fort Lauderdale, FL 33301-1923

 (Address of principal executive offices) (Zip code)

 

Craig S. Tyle, One Franklin Parkway, San Mateo, CA  94403-1906

(Name and address of agent for service)

 

Registrant's telephone number, including area code: (954) 527-7500

 

Date of fiscal year end:   8/31    

 

Date of reporting period: _05/31/16_

 

 

Item 1. Schedule of Investments.

 

 

 

 

 

TEMPLETON GLOBAL INCOME FUND

Statement of Investments, May 31, 2016 (unaudited)          
  Principal        
  Amount*       Value
 
Foreign Government and Agency Securities 76.6%          
Brazil 13.0%          
Letra Tesouro Nacional,          
Strip, 7/01/16 260 a BRL $ 71,102
Strip, 10/01/16 6,010 a BRL   1,589,109
Strip, 1/01/19 41,280 a BRL   8,376,040
Strip, 7/01/19 25,330 a BRL   4,839,199
Nota Do Tesouro Nacional,          
10.00%, 1/01/21 65,655 a BRL   16,532,569
10.00%, 1/01/23 5,510 a BRL   1,341,142
10.00%, 1/01/25 47,290 a BRL   11,173,814
10.00%, 1/01/27 12,360 a BRL   2,870,446
b Index Linked, 6.00%, 5/15/17 231 a BRL   183,549
b Index Linked, 6.00%, 5/15/19 17,875 a BRL   14,174,786
b Index Linked, 6.00%, 8/15/20 760 a BRL   601,081
b Index Linked, 6.00%, 8/15/22 25,367 a BRL   19,975,759
b Index Linked, 6.00%, 5/15/23 17,719 a BRL   13,982,761
b Index Linked, 6.00%, 8/15/24 6,860 a BRL   5,431,130
b Index Linked, 6.00%, 8/15/50 23,895 a BRL   18,412,806
senior note, 10.00%, 1/01/17 12,615 a BRL   3,420,876
          122,976,169
Colombia 1.7%          
Government of Colombia,          
senior bond, 7.75%, 4/14/21 983,000,000   COP   319,082
senior bond, 4.375%, 3/21/23. 149,000,000   COP   39,751
senior bond, 9.85%, 6/28/27 237,000,000   COP   86,610
Titulos De Tesoreria B,          
7.75%, 9/18/30 18,482,000,000   COP   5,722,792
senior bond, 11.25%, 10/24/18 2,117,000,000   COP   741,963
senior bond, 7.00%, 5/04/22 2,218,000,000   COP   690,262
senior bond, 10.00%, 7/24/24. 3,997,000,000   COP   1,450,397
senior bond, 7.50%, 8/26/26 15,781,000,000   COP   4,916,020
senior bond, 6.00%, 4/28/28 3,663,000,000   COP   994,326
senior note, 7.00%, 9/11/19 1,258,000,000   COP   402,324
senior note, B, 11.00%, 7/24/20 1,144,000,000   COP   414,759
          15,778,286
Hungary 1.7%          
c Government of Hungary, senior note, Reg S, 5.75%, 6/11/18 12,690,000   EUR   15,671,256
India 4.7%          
Government of India,          
senior bond, 7.80%, 5/03/20 231,200,000   INR   3,485,799
senior bond, 8.35%, 5/14/22 68,200,000   INR   1,050,481
senior bond, 9.15%, 11/14/24. 387,000,000   INR   6,273,150
senior bond, 8.33%, 7/09/26 476,000,000   INR   7,358,987
senior bond, 8.15%, 11/24/26. 203,000,000   INR   3,101,230
senior bond, 8.28%, 9/21/27 433,900,000   INR   6,690,535
senior bond, 8.60%, 6/02/28 239,800,000   INR   3,785,738
senior note, 7.28%, 6/03/19 9,000,000   INR   134,049
senior note, 8.12%, 12/10/20 173,600,000   INR   2,651,390
senior note, 7.16%, 5/20/23 42,900,000   INR   622,286
senior note, 8.83%, 11/25/23 579,400,000   INR   9,160,681
          44,314,326

 

Quarterly Statement of Investments | See Notes to Statements of Investments. | 1

 

TEMPLETON GLOBAL INCOME FUND
STATEMENT OF INVESTMENTS (UNAUDITED)

  Principal        
  Amount*       Value
 
Foreign Government and Agency Securities (continued)          
Indonesia 8.6%          
Government of Indonesia,          
7.875%, 4/15/19 28,078,000,000   IDR $ 2,081,183
6.125%, 5/15/28 3,157,000,000   IDR   198,409
FR31, 11.00%, 11/15/20 145,557,000,000   IDR   12,067,592
FR34, 12.80%, 6/15/21 64,492,000,000   IDR   5,759,903
FR35, 12.90%, 6/15/22 42,438,000,000   IDR   3,875,650
FR36, 11.50%, 9/15/19 32,651,000,000   IDR   2,669,327
FR39, 11.75%, 8/15/23 2,703,000,000   IDR   239,184
FR42, 10.25%, 7/15/27 3,595,000,000   IDR   307,917
FR43, 10.25%, 7/15/22 4,826,000,000   IDR   396,043
FR44, 10.00%, 9/15/24 1,618,000,000   IDR   133,846
FR46, 9.50%, 7/15/23 49,800,000,000   IDR   3,982,904
FR47, 10.00%, 2/15/28 1,052,000,000   IDR   88,758
FR48, 9.00%, 9/15/18 4,494,000,000   IDR   340,505
FR61, 7.00%, 5/15/22 13,189,000,000   IDR   939,693
senior bond, 5.625%, 5/15/23. 16,137,000,000   IDR   1,049,909
senior bond, 7.00%, 5/15/27 2,105,000,000   IDR   144,468
senior bond, 9.00%, 3/15/29 30,263,000,000   IDR   2,392,684
senior bond, FR53, 8.25%, 7/15/21 144,200,000,000   IDR   10,888,888
senior bond, FR56, 8.375%, 9/15/26 274,910,000,000   IDR   20,930,190
senior bond, FR70, 8.375%, 3/15/24 149,967,000,000   IDR   11,362,805
senior note, 8.50%, 10/15/16 19,302,000,000   IDR   1,423,162
senior note, 5.25%, 5/15/18 5,394,000,000   IDR   381,844
          81,654,864
Lithuania 0.9%          
 d Government of Lithuania, 144A, 7.375%, 2/11/20 7,065,000       8,351,113
Malaysia 3.3%          
Government of Malaysia,          
3.314%, 10/31/17 13,090,000   MYR   3,184,234
senior bond, 4.262%, 9/15/16. 46,787,000   MYR   11,388,181
senior bond, 3.814%, 2/15/17. 10,080,000   MYR   2,459,115
senior bond, 4.24%, 2/07/18 4,788,000   MYR   1,182,316
senior bond, 3.26%, 3/01/18 7,451,000   MYR   1,811,009
senior note, 3.172%, 7/15/16 19,664,000   MYR   4,768,252
senior note, 3.394%, 3/15/17 11,592,000   MYR   2,820,369
senior note, 4.012%, 9/15/17 15,886,000   MYR   3,897,797
          31,511,273
Mexico 13.5%          
Government of Mexico,          
7.25%, 12/15/16 7,441,400 e MXN   40,936,246
7.75%, 12/14/17 10,748,940 e MXN   60,790,765
senior note, 8.50%, 12/13/18 3,878,800 e MXN   22,766,696
f Mexican Udibonos,          
Index Linked, 5.00%, 6/16/16 279,294 g MXN   1,510,093
Index Linked, 3.50%, 12/14/17 216,127 g MXN   1,208,152
Index Linked, 4.00%, 6/13/19 125,685 g MXN   715,966
Index Linked, 2.50%, 12/10/20 99,117 g MXN   535,100
          128,463,018
Peru 3.2%          
Government of Peru, senior bond, 7.84%, 8/12/20 93,349,000   PEN   30,112,407

 

|2

 

TEMPLETON GLOBAL INCOME FUND
STATEMENT OF INVESTMENTS (UNAUDITED)

  Principal      
  Amount*     Value
 
Foreign Government and Agency Securities (continued)        
Philippines 1.4%        
Government of the Philippines,        
senior bond, 9.125%, 9/04/16. 2,270,000 PHP $ 49,274
senior note, 2.875%, 5/22/17 14,610,000 PHP   313,272
senior note, 5.875%, 1/31/18 590,000 PHP   13,177
senior note, 5.00%, 8/18/18 11,330,000 PHP   253,337
senior note, 3.875%, 11/22/19 548,160,000 PHP   12,103,243
senior note, 5-72, 2.125%, 5/23/18 46,907,000 PHP   997,777
        13,730,080
Poland 4.1%        
Government of Poland,        
4.75%, 10/25/16 36,315,000 PLN   9,331,018
4.75%, 4/25/17 3,210,000 PLN   838,090
5.75%, 9/23/22 60,500,000 PLN   18,153,223
h FRN, 1.75%, 1/25/17. 22,569,000 PLN   5,734,342
h FRN, 1.75%, 1/25/21. 19,374,000 PLN   4,840,859
        38,897,532
Portugal 2.7%        
Government of Portugal,        
d 144A, 5.125%, 10/15/24 9,390,000     9,399,766
c Reg S, 3.875%, 2/15/30. 13,300,000 EUR   15,392,523
c senior bond, Reg S, 4.95%, 10/25/23 92,700 EUR   119,286
c senior bond, Reg S, 5.65%, 2/15/24 232,100 EUR   309,067
        25,220,642
Slovenia 0.2%        
d Government of Slovenia, senior note, 144A, 5.50%, 10/26/22 1,938,000     2,194,058
South Korea 9.8%        
Korea Monetary Stabilization Bond,        
senior note, 2.79%, 6/02/16 3,739,000,000 KRW   3,140,996
senior note, 1.62%, 6/09/16 1,390,400,000 KRW   1,167,978
senior note, 2.46%, 8/02/16 279,200,000 KRW   234,916
senior note, 1.61%, 11/09/16 13,302,900,000 KRW   11,181,121
senior note, 2.07%, 12/02/16 2,354,400,000 KRW   1,983,703
senior note, 1.70%, 8/02/17 6,876,000,000 KRW   5,791,679
senior note, 1.56%, 10/02/17 29,255,300,000 KRW   24,605,814
Korea Treasury Bond,        
senior note, 3.00%, 12/10/16 16,332,370,000 KRW   13,828,536
senior note, 2.00%, 12/10/17 16,590,000,000 KRW   14,046,935
senior note, 2.75%, 9/10/19 895,000,000 KRW   781,368
senior note, 2.00%, 3/10/21 19,197,000,000 KRW   16,448,752
        93,211,798
Sri Lanka 1.8%        
Government of Sri Lanka,        
10.60%, 7/01/19 797,850,000 LKR   5,234,759
10.60%, 9/15/19 539,240,000 LKR   3,539,874
8.00%, 11/01/19 31,420,000 LKR   189,798
9.25%, 5/01/20 124,820,000 LKR   777,371
11.20%, 7/01/22 55,890,000 LKR   363,846
A, 9.00%, 5/01/21 702,230,000 LKR   4,220,355
A, 11.00%, 8/01/21 470,110,000 LKR   3,049,854
        17,375,857

 

|3

 

TEMPLETON GLOBAL INCOME FUND
STATEMENT OF INVESTMENTS (UNAUDITED)

  Principal      
  Amount*     Value
 
Foreign Government and Agency Securities (continued)        
i Supranational 1.2%        
Inter-American Development Bank, senior note, 7.50%, 12/05/24 185,000,000 MXN $ 11,074,985
Ukraine 4.8%        
d Government of Ukraine,        
144A, 7.75%, 9/01/19 1,338,000     1,297,592
144A, 7.75%, 9/01/20 5,725,000     5,480,399
144A, 7.75%, 9/01/21 5,566,000     5,263,488
144A, 7.75%, 9/01/22 5,431,000     5,098,487
144A, 7.75%, 9/01/23 5,431,000     5,074,727
144A, 7.75%, 9/01/24 5,431,000     5,039,506
144A, 7.75%, 9/01/25 5,431,000     5,010,098
144A, 7.75%, 9/01/26 5,431,000     5,006,567
144A, 7.75%, 9/01/27 5,431,000     4,983,486
  j,k 144A, VRI, GDP Linked Securities, 5/31/40 11,154,000     3,457,740
        45,712,090
Total Foreign Government and Agency Securities (Cost $803,754,290)       726,249,754
 
 
Short Term Investments 19.6%        
Foreign Government and Agency Securities 3.7%        
Malaysia 0.6%        
l Bank of Negara Monetary Note, 6/07/16 - 10/18/16 22,980,000 MYR   5,541,176
l Malaysia Treasury Bill, 1/20/17 200,000 MYR   47,796
        5,588,972
Mexico 1.0%        
l Mexico Treasury Bill, 6/09/16 - 3/30/17 17,563,590m MXN   9,451,758
Philippines 0.6%        
l Philippine Treasury Bill, 6/08/16 - 5/03/17 280,240,000 PHP   5,942,109
South Korea 1.5%        
Korea Monetary Stabilization Bond,        
senior note, 1.57%, 7/09/16 - 1/09/17 3,739,500,000 KRW   3,142,686
senior note, 1.56%, 8/09/16 8,107,200,000 KRW   6,810,976
senior note, 1.52%, 9/09/16 4,579,000,000 KRW   3,846,695
senior note, 1.53%, 10/08/16 445,200,000 KRW   374,022
        14,174,379
Total Foreign Government and Agency Securities (Cost $35,788,471)       35,157,218
Total Investments before Money Market Funds (Cost $839,542,761)       761,406,972

 

|4

 

TEMPLETON GLOBAL INCOME FUND
STATEMENT OF INVESTMENTS (UNAUDITED)

  Shares   Value
Money Market Funds (Cost $151,365,900) 15.9%      
United States 15.9%      
k,n Institutional Fiduciary Trust Money Market Portfolio 151,365,900   151,365,900
Total Investments (Cost $990,908,661) 96.2%     912,772,872
Other Assets, less Liabilities 3.8%     35,563,228
Net Assets 100.0%   $ 948,336,100

 

*The principal amount is stated in U.S. dollars unless otherwise indicated.
aPrincipal amount is stated in 1,000 Brazilian Real Peso Units.
bRedemption price at maturity is adjusted for inflation.
cSecurity was purchased pursuant to Regulation S under the Securities Act of 1933, which exempts from registration securities offered and sold outside of the United States.
Such a security cannot be sold in the United States without either an effective registration statement filed pursuant to the Securities Act of 1933, or pursuant to an exemption
from registration. These securities have been deemed liquid under guidelines approved by the Fund’s Board of Trustees. At May 31, 2016, the aggregate value of these
securities was $31,492,132, representing 3.32% of net assets.
dSecurity was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration only to qualified institutional buyers
or in a public offering registered under the Securities Act of 1933. These securities have been deemed liquid under guidelines approved by the Fund’s Board of Trustees. At
May 31, 2016, the aggregate value of these securities was $65,657,027, representing 6.92% of net assets.
ePrincipal amount is stated in 100 Mexican Peso Units.
fPrincipal amount of security is adjusted for inflation.
gPrincipal amount is stated in 100 Unidad de Inversion Units.
hThe coupon rate shown represents the rate at period end.
iA supranational organization is an entity formed by two or more central governments through international treaties.
jThe principal represents the notional amount. See Note 3 regarding value recovery instruments.
kNon-income producing.
lThe security is traded on a discount basis with no stated coupon rate.
mPrincipal amount is stated in 10 Mexican Peso Units.
nSee Note 6 regarding investments in affiliated management investment companies.

At May 31, 2016, the Fund had the following forward exchange contracts outstanding. See Note 3.          
 
Forward Exchange Contracts                  
        Contract Settlement   Unrealized   Unrealized  
Currency Counterpartya Type Quantity Amount* Date   Appreciation   Depreciation  
OTC Forward Exchange Contracts                  
Chilean Peso CITI Buy 515,662,000 736,082 6/02/16 $ 8,057 $ —  
Chilean Peso CITI Sell 515,662,000 747,878 6/02/16   3,740   —  
Chilean Peso DBAB Buy 1,587,099,000 2,260,020 6/02/16   30,282   —  
Chilean Peso DBAB Sell 1,587,099,000 2,303,482 6/02/16   13,180   —  
South Korean Won HSBC Buy 9,198,000,000 7,729,210 6/02/16   —   (3,231 )
South Korean Won HSBC Sell 9,198,000,000 7,427,428 6/02/16   —   (298,552 )
Chilean Peso DBAB Buy 2,311,201,000 3,306,439 6/03/16   28,483   —  
Chilean Peso DBAB Sell 2,311,201,000 3,351,996 6/03/16   17,074   —  
Chilean Peso DBAB Buy 1,123,610,000 1,696,835 6/06/16   —   (75,990 )
Chilean Peso MSCO Buy 2,165,624,000 3,236,600 6/06/16   —   (112,615 )
Chilean Peso MSCO Buy 1,390,880,000 1,997,014 6/06/16   9,377   —  
Euro BZWS Sell 4,890,942 5,648,235 6/06/16   203,849   —  
Euro HSBC Sell 6,579,510 7,458,796 6/06/16   134,769   —  
Japanese Yen CITI Sell 153,700,000 1,247,608 6/08/16   —   (141,199 )
Euro BZWS Sell 1,348,368 1,484,971 6/09/16   —   (16,147 )
Euro CITI Sell 4,817,000 5,304,374 6/09/16   —   (58,321 )
Euro HSBC Sell 3,548,865 3,857,616 6/09/16   —   (93,283 )
 
                | 5  

 

 

TEMPLETON GLOBAL INCOME FUND
STATEMENT OF INVESTMENTS (UNAUDITED)

Forward Exchange Contracts (continued)                  
 
        Contract   Settlement   Unrealized   Unrealized  
Currency Counterpartya Type Quantity Amount*   Date   Appreciation   Depreciation  
OTC Forward Exchange Contracts (continued)                    
Euro MSCO Sell 3,640,000 4,007,112   6/09/16 $ — $ (45,247 )
Euro SCNY Sell 1,325,806 1,441,409   6/09/16   —   (34,591 )
Japanese Yen HSBC Sell 230,100,000 1,874,313   6/09/16   —   (204,914 )
Chilean Peso JPHQ Buy 510,998,000 744,700   6/10/16   —   (7,844 )
Chilean Peso MSCO Buy 1,470,184,000 2,130,547   6/10/16   —   (10,553 )
Japanese Yen BZWS Sell 474,230,000 3,819,015   6/10/16   —   (466,382 )
Japanese Yen CITI Sell 496,800,000 4,004,030   6/10/16   —   (485,322 )
Japanese Yen HSBC Sell 505,050,000 4,074,134   6/10/16   —   (489,770 )
Chilean Peso DBAB Buy 1,571,026,500 2,278,006   6/13/16   —   (13,234 )
Chilean Peso MSCO Buy 2,946,442,000 4,349,762   6/13/16   —   (102,210 )
Euro DBAB Buy 3,495,500 4,047,020   6/13/16   —   (154,932 )
Euro DBAB Sell 3,495,500 3,960,052   6/13/16   67,964   —  
Japanese Yen DBAB Sell 167,200,000 1,357,738   6/13/16   —   (153,348 )
Japanese Yen JPHQ Sell 467,930,000 3,796,084   6/13/16   —   (432,878 )
Australian Dollar CITI Sell 8,460,000 6,054,484   6/14/16   —   (56,544 )
Australian Dollar JPHQ Sell 12,551,000 9,081,339   6/14/16   15,203   —  
Chilean Peso DBAB Buy 806,419,000 1,178,889   6/14/16   —   (16,475 )
Chilean Peso JPHQ Buy 1,128,000,000 1,648,761   6/14/16   —   (22,804 )
Chilean Peso CITI Buy 2,019,520,000 2,948,118   6/15/16   —   (37,350 )
Euro DBAB Buy 3,756,000 4,348,809   6/15/16   —   (166,344 )
Euro DBAB Sell 3,756,000 4,280,112   6/15/16   97,647   —  
Euro BZWS Sell 2,535,000 2,901,315   6/16/16   78,376   —  
Euro GSCO Sell 1,688,000 1,923,940   6/16/16   44,208   —  
Japanese Yen CITI Sell 230,997,000 1,883,368   6/16/16   —   (204,533 )
Japanese Yen HSBC Sell 187,120,000 1,560,634   6/16/16   —   (130,679 )
Japanese Yen JPHQ Sell 197,300,000 1,607,889   6/16/16   —   (175,437 )
South Korean Won CITI Sell 3,870,000,000 3,181,258   6/16/16   —   (68,278 )
Australian Dollar CITI Sell 1,690,900 1,213,982   6/17/16   —   (7,282 )
Japanese Yen DBAB Sell 186,830,000 1,544,471   6/17/16   —   (144,287 )
Australian Dollar CITI Sell 3,408,700 2,593,203   6/20/16   131,543   —  
Australian Dollar JPHQ Sell 8,540,000 6,479,554   6/20/16   312,224   —  
Chilean Peso DBAB Buy 567,590,000 819,388   6/20/16   —   (1,694 )
Chilean Peso DBAB Buy 2,033,461,000 2,928,566   6/20/16   923   —  
Japanese Yen CITI Sell 207,460,000 1,712,154   6/20/16   —   (163,297 )
South Korean Won DBAB Sell 5,874,000,000 4,917,539   6/20/16   —   (14,217 )
Japanese Yen DBAB Sell 187,160,000 1,531,588   6/22/16   —   (160,483 )
Chilean Peso BZWS Buy 1,898,900,000 2,781,863   6/23/16   —   (46,997 )
Chilean Peso DBAB Buy 1,013,970,000 1,463,308   6/23/16   —   (2,951 )
Indonesian Rupiah JPHQ Buy 77,590,000,000 7,053,636 AUD 6/23/16   565,499   —  
Chilean Peso DBAB Buy 1,968,980,000 2,812,829   6/24/16   22,705   —  
Euro BZWS Sell 899,632 1,012,621   6/24/16   10,496   —  
Indonesian Rupiah JPHQ Buy 33,980,000,000 3,095,563 AUD 6/24/16   242,669   —  
Malaysian Ringgit HSBC Buy 12,077,292 3,152,681   6/24/16   —   (228,299 )
Malaysian Ringgit HSBC Sell 12,077,292 2,794,376   6/24/16   —   (130,007 )
Chilean Peso DBAB Buy 1,507,780,000 2,164,951   6/28/16   5,594   —  
Chilean Peso DBAB Buy 1,155,002,000 1,662,113   6/30/16   275   —  
Euro BOFA Sell 3,504,500 3,937,341   6/30/16   32,678   —  
Malaysian Ringgit HSBC Buy 4,516,266 1,168,685   6/30/16   —   (75,343 )
Malaysian Ringgit HSBC Sell 4,516,266 1,044,465   6/30/16   —   (48,877 )
Malaysian Ringgit JPHQ Buy 3,602,500 939,374   7/05/16   —   (67,366 )
Malaysian Ringgit JPHQ Sell 3,602,500 831,218   7/05/16   —   (40,790 )
Euro BZWS Sell 1,676,000 1,836,896   7/06/16   —   (30,826 )

 

|6

 

TEMPLETON GLOBAL INCOME FUND
STATEMENT OF INVESTMENTS (UNAUDITED)

Forward Exchange Contracts (continued)                  
 
        Contract   Settlement   Unrealized   Unrealized  
Currency Counterpartya Type Quantity Amount*   Date   Appreciation   Depreciation  
OTC Forward Exchange Contracts (continued)                    
Chilean Peso DBAB Buy 2,719,981,000 3,997,503   7/07/16 $ — $ (85,212 )
Japanese Yen JPHQ Sell 278,975,000 2,334,499   7/07/16   —   (188,915 )
Malaysian Ringgit DBAB Buy 6,824,400 1,762,500   7/08/16   —   (110,746 )
Malaysian Ringgit DBAB Sell 6,824,400 1,569,910   7/08/16   —   (81,844 )
Chilean Peso DBAB Buy 806,419,000 1,179,061   7/11/16   —   (19,580 )
Euro JPHQ Sell 1,676,000 1,915,044   7/13/16   46,916   —  
Euro JPHQ Sell 3,144,000 3,583,201   7/14/16   78,682   —  
Euro CITI Sell 1,349,575 1,467,946   7/15/16   —   (36,430 )
Japanese Yen BZWS Sell 237,550,000 2,021,014   7/15/16   —   (128,164 )
Japanese Yen JPHQ Sell 154,420,000 1,312,604   7/15/16   —   (84,475 )
Chilean Peso DBAB Buy 1,026,660,000 1,515,253   7/18/16   —   (40,072 )
Euro MSCO Sell 1,228,000 1,355,712   7/18/16   —   (13,271 )
Euro BZWS Sell 11,924,000 13,061,550   7/19/16   —   (231,824 )
Japanese Yen HSBC Sell 372,780,000 3,174,081   7/19/16   —   (198,924 )
Japanese Yen SCNY Sell 219,020,000 1,879,306   7/19/16   —   (102,441 )
Malaysian Ringgit DBAB Buy 9,759,000 2,252,770 EUR 7/20/16   —   (150,302 )
Euro BZWS Sell 1,052,000 1,153,429   7/21/16   —   (19,458 )
Euro UBSW Sell 370,478 422,628   7/21/16   9,578   —  
Euro MSCO Sell 905,000 989,301   7/22/16   —   (19,725 )
Malaysian Ringgit DBAB Buy 11,019,000 2,266,445 EUR 7/22/16   139,015   —  
Euro DBAB Buy 701,000 812,502   7/25/16   —   (30,853 )
Euro DBAB Sell 701,000 773,021   7/25/16   —   (8,629 )
Euro JPHQ Sell 11,085,000 12,068,683   7/25/16   —   (291,637 )
Japanese Yen CITI Sell 178,564,000 1,451,763   7/25/16   —   (164,191 )
Japanese Yen JPHQ Sell 275,000,000 2,235,409   7/25/16   —   (253,264 )
Chilean Peso JPHQ Buy 298,440,000 444,425   7/26/16   —   (15,924 )
Indian Rupee DBAB Buy 68,380,000 1,015,067   7/27/16   —   (7,504 )
Malaysian Ringgit DBAB Buy 14,167,000 3,280,537 EUR 7/27/16   —   (231,041 )
Malaysian Ringgit JPHQ Buy 6,651,000 1,698,851   7/27/16   —   (89,904 )
Malaysian Ringgit JPHQ Sell 6,651,000 1,532,135   7/27/16   —   (76,811 )
Chilean Peso DBAB Buy 1,143,490,000 1,696,950   7/28/16   —   (55,432 )
Euro BOFA Sell 6,239,050 7,087,810   7/28/16   130,316   —  
Euro CITI Sell 4,026,945 4,566,455   7/28/16   75,796   —  
Euro CITI Sell 960,795 1,060,943   7/28/16   —   (10,490 )
Euro GSCO Sell 6,683,000 7,368,809   7/28/16   —   (83,757 )
Indian Rupee HSBC Buy 869,744,000 11,375,507 EUR 7/28/16   128,188   —  
Euro BOFA Sell 6,239,050 7,087,186   7/29/16   129,476   —  
Euro JPHQ Sell 6,683,000 7,453,483   7/29/16   685   —  
Japanese Yen DBAB Sell 631,276,974 5,355,523   7/29/16   —   (357,975 )
Malaysian Ringgit JPHQ Buy 56,765,000 14,414,677   7/29/16   —   (683,380 )
Malaysian Ringgit JPHQ Buy 14,167,000 3,220,651 EUR 7/29/16   —   (164,671 )
Malaysian Ringgit JPHQ Sell 56,765,000 13,074,974   7/29/16   —   (656,323 )
Chilean Peso MSCO Buy 695,440,000 1,045,397   8/04/16   —   (47,745 )
Euro HSBC Sell 6,684,000 7,378,468   8/05/16   —   (77,304 )
Euro JPHQ Sell 893,000 985,894   8/05/16   —   (10,216 )
Malaysian Ringgit HSBC Buy 170,000 42,405   8/08/16   —   (1,295 )
Malaysian Ringgit HSBC Sell 170,000 39,189   8/08/16   —   (1,921 )
Chilean Peso DBAB Buy 584,343,000 862,499   8/09/16   —   (24,633 )
Euro CITI Sell 1,575,600 1,806,882   8/09/16   49,099   —  
Euro CITI Sell 851,902 935,687   8/10/16   —   (14,754 )
Japanese Yen CITI Sell 613,483,000 4,966,147   8/10/16   —   (588,517 )
South Korean Won HSBC Buy 6,054,254,000 5,152,776   8/10/16   —   (74,765 )

 

|7

 

TEMPLETON GLOBAL INCOME FUND
STATEMENT OF INVESTMENTS (UNAUDITED)

Forward Exchange Contracts (continued)                    
 
        Contract     Settlement   Unrealized   Unrealized  
Currency Counterpartya Type Quantity Amount*     Date   Appreciation   Depreciation  
OTC Forward Exchange Contracts (continued)                      
South Korean Won HSBC Sell 6,054,254,000 5,051,948     8/10/16 $ — $ (26,063 )
Euro BOFA Sell 4,891,000 5,593,558     8/11/16   136,625   —  
Euro DBAB Buy 1,775,000 2,058,334     8/11/16   —   (77,951 )
Euro DBAB Sell 1,775,000 1,959,502     8/11/16   —   (20,881 )
Euro JPHQ Sell 2,248,000 2,473,924     8/11/16   —   (34,190 )
Euro GSCO Sell 560,000 639,629     8/12/16   14,809   —  
South Korean Won HSBC Buy 8,324,000,000 877,059,889 JPY   8/12/16   —   (960,130 )
Euro SCNY Sell 3,955,000 4,523,927     8/15/16   110,655   —  
Chilean Peso MSCO Buy 1,625,385,000 2,360,660     8/16/16   —   (31,683 )
Euro JPHQ Sell 12,428,000 14,050,662     8/16/16   182,105   —  
Japanese Yen JPHQ Sell 100,450,000 895,105     8/16/16   —   (14,585 )
Chilean Peso DBAB Buy 2,138,616,500 3,131,439     8/17/16   —   (67,365 )
Chilean Peso MSCO Buy 1,625,385,000 2,337,473     8/18/16   —   (8,952 )
Japanese Yen DBAB Sell 687,444,000 5,583,891     8/18/16   —   (642,120 )
South Korean Won JPHQ Buy 980,000,000 831,319     8/18/16   —   (9,430 )
South Korean Won JPHQ Sell 980,000,000 820,908     8/18/16   —   (981 )
Euro UBSW Sell 9,844,000 11,185,590     8/19/16   199,350   —  
Chilean Peso MSCO Buy 521,800,000 746,655     8/22/16   581   —  
Euro JPHQ Sell 5,056,324 5,721,357     8/22/16   77,711   —  
Japanese Yen HSBC Sell 1,286,140,000 10,437,754     8/22/16   —   (1,212,075 )
Japanese Yen JPHQ Sell 926,943,000 7,521,660     8/22/16   —   (874,570 )
Mexican Peso. HSBC Buy 21,920,000 1,294,361     8/22/16   —   (117,485 )
Chilean Peso JPHQ Buy 662,940,000 938,942     8/23/16   10,319   —  
Indian Rupee JPHQ Buy 412,387,000                    5,376,231 EUR 8/23/16   50,751   —  
Japanese Yen BZWS Sell 307,053,000 2,504,919     8/24/16   —   (276,548 )
Japanese Yen DBAB Sell 303,441,000 2,702,057     8/24/16   —   (46,691 )
Euro BOFA Sell 1,464,790 1,641,439     8/26/16   6,267   —  
Euro SCNY Sell 8,685,912 10,117,871     8/26/16   421,627   —  
Japanese Yen JPHQ Sell 800,079,000 6,791,208     8/26/16   —   (456,870 )
Euro JPHQ Sell 3,821,732 4,395,756     8/29/16   129,020   —  
Japanese Yen DBAB Sell 509,728,000 4,285,229     8/29/16   —   (332,968 )
Japanese Yen JPHQ Sell 450,908,000 3,789,191     8/29/16   —   (296,091 )
Malaysian Ringgit DBAB Buy 71,195,440                  15,177,675 EUR 8/30/16   259,092   —  
Chilean Peso CITI Buy 515,662,000 741,586     8/31/16   —   (3,780 )
Chilean Peso DBAB Buy 1,115,637,000 1,596,276     8/31/16   —   (29 )
Euro BZWS Sell 4,618,433 5,114,961     8/31/16   —   (41,641 )
Indian Rupee DBAB Buy 1,151,765,600                  14,996,460 EUR 8/31/16   137,330   —  
Japanese Yen BZWS Sell 726,500,000 6,481,399     8/31/16   —   (101,325 )
Japanese Yen JPHQ Sell 304,127,000 2,544,964     8/31/16   —   (210,692 )
Japanese Yen HSBC Sell 980,688,000 8,709,485     9/01/16   —   (176,772 )
Chilean Peso DBAB Buy 3,898,300,000 5,607,480     9/02/16   —   (30,837 )
Japanese Yen BZWS Sell 192,016,500 1,701,083     9/09/16   —   (39,403 )
Australian Dollar CITI Sell 8,404,000 6,054,074     9/14/16   2,597   —  
South Korean Won CITI Sell 5,158,000,000 4,256,829     9/19/16   —   (67,722 )
South Korean Won HSBC Sell 9,640,000,000 7,896,461     9/19/16   —   (185,871 )
Japanese Yen BZWS Sell 132,990,000 1,101,002     9/20/16   —   (105,003 )
Japanese Yen CITI Sell 220,552,000 1,988,747     9/23/16   —   (11,553 )
Japanese Yen MSCO Sell 311,200,000 2,807,321     9/23/16   —   (15,112 )
Japanese Yen BZWS Sell 125,158,380 1,116,464     9/26/16   —   (18,803 )
South Korean Won HSBC Sell 10,258,000,000 8,817,639     9/26/16   217,586   —  
South Korean Won HSBC Sell 10,307,000,000 8,795,119     9/28/16   154,106   —  
Australian Dollar GSCO Sell 26,618,090 20,232,144     10/06/16   1,078,356   —  

 

|8

 

TEMPLETON GLOBAL INCOME FUND
STATEMENT OF INVESTMENTS (UNAUDITED)

Forward Exchange Contracts (continued)                  
 
        Contract   Settlement   Unrealized   Unrealized  
Currency Counterpartya Type Quantity Amount*   Date   Appreciation   Depreciation  
OTC Forward Exchange Contracts (continued)                    
Japanese Yen JPHQ Sell 278,975,000 2,517,053   10/06/16 $ — $ (14,480 )
Japanese Yen JPHQ Sell 278,975,000 2,341,455   10/07/16   —   (190,183 )
Japanese Yen HSBC Sell 555,000,000 4,670,341   10/11/16   —   (367,000 )
Euro JPHQ Sell 846,000 967,926   10/13/16   21,782   —  
Japanese Yen BZWS Sell 281,000,000 2,365,220   10/13/16   —   (185,429 )
Japanese Yen DBAB Sell 277,200,000 2,333,923   10/13/16   —   (182,234 )
Euro BZWS Sell 1,760,000 2,025,408   10/17/16   56,769   —  
Malaysian Ringgit DBAB Buy 142,760,000 29,481,249 EUR 10/17/16   1,468,366   —  
South Korean Won HSBC Sell 16,567,000,000 14,308,416   10/18/16   421,189   —  
Mexican Peso. DBAB Buy 67,596,340 3,979,767   10/21/16   —   (372,630 )
Japanese Yen BZWS Sell 146,100,000 1,230,238   10/24/16   —   (96,524 )
Mexican Peso. CITI Buy 21,771,590 1,277,526   10/24/16   —   (116,082 )
Mexican Peso. DBAB Buy 62,150,960 3,641,523   10/24/16   —   (325,971 )
Euro BZWS Sell 2,780,907 3,095,914   10/27/16   —   (15,852 )
South Korean Won HSBC Sell 4,601,000,000 3,984,757   11/02/16   128,390   —  
Euro BZWS Sell 16,250,000 18,107,213   11/04/16   —   (81,738 )
Japanese Yen CITI Sell 104,080,747 864,745   11/09/16   —   (81,060 )
Euro JPHQ Sell 517,652 559,434   11/14/16   —   (20,207 )
Japanese Yen CITI Sell 335,732,000 2,758,912   11/14/16   —   (292,595 )
Japanese Yen GSCO Sell 203,561,000 1,877,834   11/14/16   27,645   —  
Japanese Yen HSBC Sell 286,780,000 2,354,806   11/14/16   —   (251,771 )
Japanese Yen JPHQ Sell 102,242,000 838,867   11/14/16   —   (90,422 )
Japanese Yen SCNY Sell 152,158,000 1,403,697   11/14/16   20,716   —  
South Korean Won CITI Sell 5,173,000,000 4,424,960   11/14/16   89,530   —  
Australian Dollar JPHQ Sell 15,958,000 11,671,681   11/16/16   203,294   —  
Japanese Yen CITI Sell 152,157,000 1,254,127   11/16/16   —   (128,960 )
Japanese Yen MSCO Sell 245,000,000 2,018,371   11/16/16   —   (208,647 )
Japanese Yen SCNY Sell 103,657,300 957,469   11/16/16   15,237   —  
South Korean Won CITI Sell 4,268,000,000 3,647,552   11/16/16   70,640   —  
South Korean Won HSBC Sell 13,274,000,000 11,314,836   11/17/16   190,285   —  
Indonesian Rupiah JPHQ Buy 34,485,000,000 3,466,526 AUD 11/18/16   —   (50,195 )
Japanese Yen DBAB Sell 592,373,000 4,878,027   11/18/16   —   (507,015 )
South Korean Won HSBC Sell 7,321,000,000 6,237,274   11/18/16   101,800   —  
Japanese Yen CITI Sell 733,240,000 6,761,712   11/21/16   95,268   —  
Japanese Yen CITI Sell 823,639,000 6,756,955   11/21/16   —   (731,375 )
South Korean Won CITI Sell 16,347,000,000 13,822,933   11/21/16   123,372   —  
South Korean Won DBAB Sell 5,870,000,000 4,989,757   11/23/16   70,488   —  
Japanese Yen HSBC Sell 154,574,000 1,421,239   11/25/16   15,656   —  
Mexican Peso. CITI Buy 245,000,000 14,422,794   11/25/16   —   (1,394,910 )
Japanese Yen BOFA Sell 860,890,000 7,880,938   11/28/16   51,587   —  
Japanese Yen SCNY Sell 696,345,000 6,388,633   11/28/16   55,734   —  
Malaysian Ringgit HSBC Buy 50,063,035 10,796,428 EUR 11/28/16   —   (33,564 )
Malaysian Ringgit JPHQ Buy 118,779,709 25,789,159 EUR 11/30/16   —   (278,793 )
Euro GSCO Sell 454,000 486,756   12/02/16   —   (21,978 )
South Korean Won HSBC Sell 3,230,000,000 2,725,738   12/02/16   18,990   —  
Australian Dollar JPHQ Sell 8,507,000 6,054,253   12/12/16   —   (54,710 )
Australian Dollar JPHQ Sell 4,228,000 3,026,741   12/14/16   —   (9,258 )
Japanese Yen GSCO Sell 69,178,000 590,478   1/10/17   —   (40,015 )
Japanese Yen JPHQ Sell 278,975,000 2,372,418   1/10/17   —   (170,178 )
Euro BZWS Sell 1,509,000 1,661,152   1/11/17   —   (32,754 )
Japanese Yen CITI Sell 94,950,000 815,399   1/17/17   —   (50,285 )
Euro JPHQ Sell 2,459,575 2,714,461   1/23/17   —   (47,963 )

 

|9

 

TEMPLETON GLOBAL INCOME FUND
STATEMENT OF INVESTMENTS (UNAUDITED)

Forward Exchange Contracts (continued)                    
 
        Contract Settlement       Unrealized   Unrealized  
Currency Counterpartya Type Quantity Amount* Date   Appreciation   Depreciation  
OTC Forward Exchange Contracts (continued)                      
Japanese Yen DBAB Sell 95,240,000 825,125 1/23/17   $   — $ (43,464 )
Euro BZWS Sell 4,351,556 4,770,328 1/27/17       —   (117,900 )
Euro GSCO Sell 1,800,000 1,975,302 1/27/17       —   (46,690 )
Japanese Yen JPHQ Sell 95,800,000 817,832 1/27/17       —   (56,040 )
Japanese Yen HSBC Sell 817,266,455 6,979,218 1/31/17       —   (477,242 )
Euro BZWS Sell 4,094,000 4,639,014 2/08/17       37,669   —  
Euro CITI Sell 8,393,000 9,514,431 2/09/17       80,920   —  
Japanese Yen CITI Sell 152,232,000 1,320,312 2/09/17       —   (69,228 )
Euro HSBC Sell 7,662,000 8,621,589 2/10/17       9,322   —  
Euro BZWS Sell 23,553,000 26,989,383 2/13/17       511,753   —  
Euro GSCO Sell 1,183,000 1,346,964 2/13/17       17,068   —  
Euro GSCO Sell 6,210,000 7,081,698 2/16/17       99,662   —  
Euro SCNY Sell 6,873,000 7,831,302 2/16/17       103,842   —  
Japanese Yen GSCO Sell 195,642,140 1,742,868 2/16/17       —   (43,537 )
Euro BZWS Sell 1,403,000 1,576,060 2/22/17       —   (1,781 )
Japanese Yen HSBC Sell 796,744,000 7,194,639 2/27/17       —   (84,451 )
Mexican Peso. CITI Buy 62,000,000 3,291,919 2/27/17       —   (24,125 )
Euro BOFA Sell 1,471,272 1,640,586 2/28/17       —   (14,492 )
Mexican Peso. MSCO Buy 117,000,000 6,279,014 3/01/17       —   (113,490 )
Japanese Yen JPHQ Sell 416,700,000 3,738,091 3/03/17       —   (69,682 )
Japanese Yen HSBC Sell 196,900,000 1,753,339 3/06/17       —   (46,195 )
Mexican Peso. HSBC Buy 82,460,700 4,474,993 3/10/17       —   (133,126 )
Japanese Yen JPHQ Sell 130,931,000 1,169,069 3/31/17       —   (29,094 )
Mexican Peso. CITI Buy 21,365,740 1,169,431 4/07/17       —   (47,293 )
Japanese Yen CITI Sell 146,000,000 1,372,180 4/13/17       35,226   —  
South Korean Won HSBC Sell 13,696,000,000 12,015,616 4/25/17       541,550   —  
South Korean Won HSBC Sell 3,816,000,000 3,329,988 4/26/17       133,071   —  
Japanese Yen BOFA Sell 705,633,500 6,581,174 5/18/17       107,859   —  
Japanese Yen CITI Sell 705,604,100 6,577,679 5/18/17       104,633   —  
Japanese Yen BOFA Sell 704,526,000 6,544,598 5/19/17       81,109   —  
Japanese Yen HSBC Sell 707,007,200 6,567,647 5/19/17       81,395   —  
Japanese Yen BOFA Sell 706,440,000 6,537,757 5/22/17       55,705   —  
Japanese Yen JPHQ Sell 532,106,000 4,940,127 5/22/17       57,704   —  
Mexican Peso. JPHQ Buy 39,025,000 2,049,579 5/30/17       —   (9,748 )
Total Forward Exchange Contracts         $ 11,358,679 $ (25,364,570 )
Net unrealized appreciation (depreciation)               $ (14,005,891 )
 
*In U.S. dollars unless otherwise indicated.                      
aMay be comprised of multiple contracts with the same counterparty, currency and settlement date.                
 
 
At May 31, 2016, the Fund had the following interest rate swap contracts outstanding. See Note 3.              
 
Interest Rate Swap Contracts                      
             Notional            Expiration   Unrealized   Unrealized  
Description       Exchange    Amount   Date         Appreciation   Depreciation  
 
Centrally Cleared Swap Contracts                      
Receive Floating rate 3-month USD BBA LIBOR                    
Pay Fixed rate 0.926%                            LCH      $58,090,000         10/17/17 $ — $ (13,534 )

 

|10

 

      TEMPLETON GLOBAL INCOME FUND  
  STATEMENT OF INVESTMENTS (UNAUDITED)  
 
 
 
 
Interest Rate Swap Contracts (continued)                  
 
      Notional Expiration   Unrealized   Unrealized  
Description Exchange   Amount Date   Appreciation   Depreciation  
Centrally Cleared Swap Contracts (continued)                  
Receive Floating rate 3-month USD BBA LIBOR                  
Pay Fixed rate 1.914% LCH $ 35,260,000 1/22/25 $ — $ (1,065,167 )
Receive Floating rate 3-month USD BBA LIBOR                  
Pay Fixed rate 1.970% LCH   44,070,000 1/23/25   —   (1,535,562 )
Receive Floating rate 3-month USD BBA LIBOR                  
Pay Fixed rate 1.973% LCH   26,010,000 1/27/25   —   (911,901 )
Receive Floating rate 3-month USD BBA LIBOR                  
Pay Fixed rate 1.937% LCH   6,500,000 1/29/25   —   (207,417 )
Receive Floating rate 3-month USD BBA LIBOR                  
Pay Fixed rate 1.942% LCH   5,500,000 1/30/25   —   (176,863 )
Receive Floating rate 3-month USD BBA LIBOR                  
Pay Fixed rate 1.817% LCH   8,680,000 2/03/25   —   (186,099 )
Receive Floating rate 3-month USD BBA LIBOR                  
Pay Fixed rate 1.978% LCH   800,000 3/27/25   —   (25,095 )
Receive Floating rate 3-month USD BBA LIBOR                  
Pay Fixed rate 1.985% LCH   800,000 3/27/25   —   (25,595 )
Receive Floating rate 3-month USD BBA LIBOR                  
Pay Fixed rate 2.449% LCH   6,340,000 7/02/25   —   (494,784 )
Receive Floating rate 3-month USD BBA LIBOR                  
Pay Fixed rate 2.310% LCH   16,220,000 7/29/25   —   (1,044,346 )
Receive Floating rate 3-month USD BBA LIBOR                  
Pay Fixed rate 2.752% LCH   23,960,000 7/29/45   —   (3,460,325 )
Net unrealized appreciation (depreciation)             $ (9,146,688 )

 

|11

 

TEMPLETON GLOBAL INCOME FUND

Notes to Statement of Investments (unaudited)

1. ORGANIZATION

Templeton Global Income Fund (Fund) is registered under the Investment Company Act of 1940 (1940 Act) as a closed-end management investment company and applies the specialized accounting and reporting guidance in U.S. Generally Accepted Accounting Principles.

2. FINANCIAL INSTRUMENT VALUATION

The Fund’s investments in financial instruments are carried at fair value daily. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Fund calculates the net asset value (NAV) per share as of 4 p.m. Eastern time each day the New York Stock Exchange (NYSE) is open for trading. Under compliance policies and procedures approved by the Fund’s Board of Trustees (the Board), the Fund’s administrator has responsibility for oversight of valuation, including leading the cross-functional Valuation Committee (VC). The VC provides administration and oversight of the Fund’s valuation policies and procedures, which are approved annually by the Board. Among other things, these procedures allow the Fund to utilize independent pricing services, quotations from securities and financial instrument dealers, and other market sources to determine fair value.

Debt securities generally trade in the over-the-counter (OTC) market rather than on a securities exchange. The Fund’s pricing services use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services also utilize proprietary valuation models which may consider market characteristics such as benchmark yield curves, credit spreads, estimated default rates, anticipated market interest rate volatility, coupon rates, anticipated timing of principal repayments, underlying collateral, and other unique security features in order to estimate the relevant cash flows, which are then discounted to calculate the fair value. Securities denominated in a foreign currency are converted into their U.S. dollar equivalent at the foreign exchange rate in effect at 4 p.m. Eastern time on the date that the values of the foreign debt securities are determined.

Investments in open-end mutual funds are valued at the closing NAV.

Derivative financial instruments (derivatives) listed on an exchange are valued at the official closing price of the day. Certain derivatives trade in the OTC market. The Fund’s pricing services use various techniques including industry standard option pricing models and proprietary discounted cash flow models to determine the fair value of those instruments. The Fund’s net benefit or obligation under the derivative contract, as measured by the fair value of the contract, is included in net assets.

The Fund has procedures to determine the fair value of financial instruments for which market prices are not reliable or readily available. Under these procedures, the VC convenes on a regular basis to review such financial instruments and considers a number of factors, including significant unobservable valuation inputs, when arriving at fair value. The VC primarily employs a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values, and other relevant information for the investment to determine the fair value of the investment. An income-based valuation approach may also be used in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Due to the inherent uncertainty of valuations of such investments, the fair values may differ significantly from the values that would have been used had an active market existed. The VC employs various methods for calibrating these valuation approaches including a regular review of key inputs and assumptions, transactional back-testing or disposition analysis, and reviews of any related market activity.

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TEMPLETON GLOBAL INCOME FUND

NOTES TO STATEMENT OF INVESTMENTS (UNAUDITED)

3. DERIVATIVE FINANCIAL INSTRUMENTS

The Fund invested in derivatives in order to manage risk or gain exposure to various other investments or markets. Derivatives are financial contracts based on an underlying or notional amount, require no initial investment or an initial net investment that is smaller than would normally be required to have a similar response to changes in market factors, and require or permit net settlement. Derivatives contain various risks including the potential inability of the counterparty to fulfill their obligations under the terms of the contract, the potential for an illiquid secondary market, and/or the potential for market movements.

Derivative counterparty credit risk is managed through a formal evaluation of the creditworthiness of all potential counterparties. The Fund attempts to reduce its exposure to counterparty credit risk on OTC derivatives, whenever possible, by entering into International Swaps and Derivatives Association (ISDA) master agreements with certain counterparties. These agreements contain various provisions, including but not limited to collateral requirements, events of default, or early termination. Termination events applicable to the counterparty include certain deteriorations in the credit quality of the counterparty. Termination events applicable to the Fund include failure of the Fund to maintain certain net asset levels and/or limit the decline in net assets over various periods of time. In the event of default or early termination, the ISDA master agreement gives the non-defaulting party the right to net and close-out all transactions traded, whether or not arising under the ISDA agreement, to one net amount payable by one counterparty to the other. Early termination by the counterparty may result in an immediate payment by the Fund of any net liability owed to that counterparty under the ISDA agreement.

Collateral requirements differ by type of derivative. Collateral or initial margin requirements are set by the broker or exchange clearing house for exchange traded and centrally cleared derivatives. Initial margin deposited is held at the exchange and can be in the form of cash and/or securities. For OTC derivatives traded under an ISDA master agreement, posting of collateral is required by either the Fund or the applicable counterparty if the total net exposure of all OTC derivatives with the applicable counterparty exceeds the minimum transfer amount, which typically ranges from $100,000 to $250,000, and can vary depending on the counterparty and the type of the agreement. Generally, collateral is determined at the close of Fund business each day and any additional collateral required due to changes in derivative values may be delivered by the Fund or the counterparty within a few business days. Collateral pledged and/or received by the Fund for OTC derivatives, if any, is held in segregated accounts with the Fund’s custodian/counterparty broker and can be in the form of cash and/or securities. Unrestricted cash may be invested according to the Fund’s investment objectives. To the extent that the amounts due to the Fund from its counterparties are not subject to collateralization or are not fully collateralized, the Fund bears the risk of loss from counterparty non-performance.

At May 31, 2016, the Fund received $801,571 in U.S. Treasury Bonds and Notes as collateral for dervatives.

The Fund entered into OTC forward exchange contracts primarily to manage and/or gain exposure to certain foreign currencies. A forward exchange contract is an agreement between the Fund and a counterparty to buy or sell a foreign currency for a specific exchange rate on a future date.

The Fund entered into interest rate swap contracts primarily to manage interest rate risk. An interest rate swap is an agreement between the Fund and a counterparty to exchange cash flows based on the difference between two interest rates, applied to a notional amount. These agreements may be privately negotiated in the over-the-counter market (OTC interest rate swaps) or may be executed on a registered exchange (centrally cleared interest rate swaps). For centrally cleared interest rate swaps, required initial margins are pledged by the Fund, and the daily change in fair value is accounted for as a variation margin payable or receivable. Over the term of the contract, contractually required payments to be paid and to be received are accrued daily and recorded as unrealized depreciation and appreciation until the payments are made, at which time they are realized.

The Fund invests in value recovery instruments (VRI) primarily to gain exposure to growth risk. Periodic payments from VRI are dependent on established benchmarks for underlying variables. VRI has a notional amount, which is used to calculate amounts of payments to holders. Payments are recorded upon receipt as realized gains. The risks of investing in VRI include growth risk, liquidity, and the potential loss of investment.

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TEMPLETON GLOBAL INCOME FUND

NOTES TO STATEMENT OF INVESTMENTS (UNAUDITED)

4. INCOME TAXES

At May 31, 2016, the cost of investments and net unrealized appreciation (depreciation) for income tax purposes were as follows:

Cost of investments. $ 999,793,654  
 
Unrealized appreciation $ 12,856,741  
Unrealized depreciation   (99,877,523 )
Net unrealized appreciation (depreciation) $ (87,020,782 )

 

5. CONCENTRATION OF RISK

Investing in foreign securities may include certain risks and considerations not typically associated with investing in U.S. securities, such as fluctuating currency values and changing local and regional economic, political and social conditions, which may result in greater market volatility. In addition, certain foreign securities may not be as liquid as U.S. securities.

6. INVESTMENTS IN AFFILIATED MANAGEMENT INVESTMENT COMPANIES

The Fund invests in one or more affiliated management investment companies for purposes other than exercising a controlling influence over the management or policies.

                    % of  
                    Affiliated  
  Number of       Number of         Fund Shares  
  Shares Held       Shares   Value     Outstanding  
  at Beginning Gross Gross   Held at End   at End Investment Realized Held at End  
  of Period Additions Reductions   of Period   of Period Income Gain (Loss) of Period  
 
Non-Controlled Affiliates                      
Institutional Fiduciary Trust Money                      
Market Portfolio 102,398,725 346,778,680 (297,811,505 ) 151,365,900 $ 151,365,900 $- $- 0.74 %

 

7. FAIR VALUE MEASUREMENTS

The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s financial instruments and are summarized in the following fair value hierarchy:

The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.

For movements between the levels within the fair value hierarchy, the Fund has adopted a policy of recognizing the transfers as of the date of the underlying event which caused the movement.

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TEMPLETON GLOBAL INCOME FUND

NOTES TO STATEMENT OF INVESTMENTS (UNAUDITED)

A summary of inputs used as of May 31, 2016, in valuing the Fund’s assets and liabilities carried at fair value, is as follows:

    Level 1   Level 2   Level 3   Total
Assets:                
Investments in Securities:                
Foreign Government and Agency Securitiesa $ — $ 726,249,754 $ — $ 726,249,754
Short Term Investments   151,365,900   35,157,218   —   186,523,118
Total Investments in Securities $ 151,365,900 $ 761,406,972 $ — $ 912,772,872
 
Other Financial Instruments                
Forward Exchange Contracts $ — $ 11,358,679 $ — $ 11,358,679
 
Liabilities:                
Other Financial Instruments                
Forward Exchange Contracts $ — $ 25,364,570 $ — $ 25,364,570
Swap Contracts.   —   9,146,688   —   9,146,688
Total Other Financial Instruments $ — $ 34,511,258 $ — $ 34,511,258
 
aFor detailed categories, see the accompanying Statement of Investments.            

 

8. SUBSEQUENT EVENTS

The Fund has evaluated subsequent events through the issuance of the Statement of Investments and determined that no events have occurred that require disclosure.

Abbreviations        
 
Counterparty/Exchange Currency Selected Portfolio
BOFA Bank of America Corp. AUD Australian Dollar FRN Floating Rate Note
BZWS Barclays Bank PLC BRL Brazilian Real GDP Gross Domestic Product
CITI Citibank, N.A. COP Colombian Peso VRI Value Recovery Instruments
DBAB Deutsche Bank AG EUR Euro    
GSCO Goldman Sachs Group, Inc. IDR Indonesian Rupiah    
HSBC HSBC Bank PLC INR Indian Rupee    
JPHQ JPMorgan Chase Bank, N.A. JPY Japanese Yen    
LCH LCH Clearnet LLC KRW South Korean Won    
MSCO Morgan Stanley and Co. Inc. LKR Sri Lankan Rupee    
SCNY Standard Chartered Bank MXN Mexican Peso    
UBSW UBS AG MYR Malaysian Ringgit    
    PEN Peruvian Nuevo Sol    
    PHP Philippine Peso    
    PLN Polish Zloty    

 

For additional information on the Fund’s significant accounting policies, please refer to the Fund’s most recent semiannual or annual shareholder report.

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Item 2. Controls and Procedures.

 

(a) Evaluation of Disclosure Controls and Procedures.  The Registrant maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the Registrant’s filings under the Securities Exchange Act of 1934 and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission.  Such information is accumulated and communicated to the Registrant’s management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.  The Registrant’s management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

 

Within 90 days prior to the filing date of this Quarterly Schedule of Portfolio Holdings on Form N-Q, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrant’s management, including the Registrant’s principal executive officer and the Registrant’s principal financial officer, of the effectiveness of the design and operation of the Registrant’s disclosure controls and procedures.  Based on such evaluation, the Registrant’s principal executive officer and principal financial officer concluded that the Registrant’s disclosure controls and procedures are effective.

 

(b) Changes in Internal Controls.  There have been no changes in the Registrant’s internal controls or in other factors that could materially affect the internal controls over financial reporting subsequent to the date of their evaluation in connection with the preparation of this Quarterly Schedule of Portfolio Holdings on Form N-Q.

 

 

Item 3. Exhibits.

 

(a) Certification pursuant to Section 30a-2 under the Investment Company Act of 1940 of Laura F. Fergerson, Chief Executive Officer - Finance and Administration, and Mark H. Otani, Chief Financial Officer and Chief Accounting Officer.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Templeton Global Income Fund

 

 

By /s/ LAURA F. FERGERSON

      Laura F. Fergerson

      Chief Executive Officer –

 Finance and Administration

Date July 27, 2016

 

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

 

 

By /s/ LAURA F. FERGERSON

      Laura F. Fergerson

      Chief Executive Officer –

 Finance and Administration

Date July 27, 2016

 

 

By /s/ MARK H. OTANI

      Mark H. Otani

Chief Financial Officer and

 Chief Accounting Officer

Date July 27, 2016