UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-21142
Eaton Vance Municipal Bond Fund
(Exact Name of Registrant as Specified in Charter)
One Post Office Square, Boston, Massachusetts 02109
(Address of Principal Executive Offices)
Deidre E. Walsh
One Post Office Square, Boston, Massachusetts 02109
(Name and Address of Agent for Services)
(617) 482-8260
(Registrant’s Telephone Number)
September 30
Date of Fiscal Year End
March 31, 2025
Date of Reporting Period
Item 1. Reports to Stockholders
(a)
Eaton Vance
Municipal Bond Funds
Semi-Annual Report
March 31, 2025
Municipal
(EIM) • California (EVM) • New York (ENX)
Commodity Futures Trading Commission Registration. The Commodity Futures Trading Commission (“CFTC”) has adopted regulations that subject registered investment companies and advisers to regulation by the CFTC if a fund invests more than a
prescribed level of its assets in certain CFTC-regulated instruments (including futures, certain options and swap agreements) or markets itself as providing investment exposure to such instruments. The investment adviser has claimed an exclusion
from the definition of “commodity pool operator” under the Commodity Exchange Act with respect to its management of each Fund. Accordingly, neither the Funds nor the adviser with respect to the operation of the Funds is subject to CFTC
regulation. Because of its management of other strategies, the Funds' adviser is registered with the CFTC as a commodity pool operator. The adviser is also registered as a commodity trading advisor.
Fund shares are not insured by the FDIC and are not deposits or
other obligations of, or guaranteed by, any depository institution. Shares are subject to investment risks, including possible loss of principal invested.
Eaton Vance
Municipal Bond Fund
March 31, 2025
Performance
Portfolio Manager(s) Cynthia J.
Clemson and Julie P. Callahan, CFA
| % Average Annual Total Returns1,2 | Inception Date | Six Months | One Year | Five Years | Ten Years |
| Fund at NAV | 08/30/2002 | (3.54)% | 0.32% | 0.12% | 2.17% |
| Fund at Market Price | — | (4.58) | 2.00 | 0.24 | 2.28 |
|
| |||||
| Bloomberg Municipal Bond Index | — | (1.44)% | 1.22% | 1.07% | 2.12% |
| % Premium/Discount to NAV3 | |
| As of period end | (7.77)% |
| Distributions 4 | |
| Total Distributions per share for the period | $0.30 |
| Distribution Rate at NAV | 5.64% |
| Taxable-Equivalent Distribution Rate at NAV | 9.53 |
| Distribution Rate at Market Price | 6.11 |
| Taxable-Equivalent Distribution Rate at Market Price | 10.33 |
| % Total Leverage5 | |
| Residual Interest Bond (RIB) Financing | 35.18% |
See Endnotes and Additional Disclosures in this report.
Past performance is no guarantee of future results.
Returns are historical and are calculated net of management fees and other expenses by determining the percentage change in net asset value (NAV) or market price (as applicable) with all distributions reinvested in accordance with the Fund’s
Dividend Reinvestment Plan. Furthermore, returns do not reflect the deduction of taxes that shareholders may have to pay on Fund distributions or upon the sale of Fund shares. Performance at market price will differ from performance at NAV due to
variations in the Fund’s market price versus NAV, which may reflect factors such as fluctuations in supply and demand for Fund shares, changes in Fund distributions, shifting market expectations for the Fund’s future returns and
distribution rates, and other considerations affecting the trading prices of closed-end funds. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance for
periods less than or equal to one year is cumulative. Performance is for the stated time period only; due to market volatility, current Fund performance may be lower or higher than the quoted return. For performance as of the most recent month-end,
please refer to eatonvance.com.
2
Eaton Vance
Municipal Bond Fund
March 31, 2025
Fund Profile
| Credit Quality (% of total investments)1,2 |
Footnotes:
| 1 | For purposes of the Fund’s rating restrictions, ratings are based on Moody’s Investors Service, Inc. (“Moody’s”), S&P Global Ratings (“S&P”) or Fitch Ratings (“Fitch”), as applicable. If securities are rated differently by the ratings agencies, the highest rating is applied. Ratings, which are subject to change, apply to the creditworthiness of the issuers of the underlying securities and not to the Fund or its shares. Credit ratings measure the quality of a bond based on the issuer’s creditworthiness, with ratings ranging from AAA, being the highest, to D, being the lowest based on S&P’s measures. Ratings of BBB or higher by S&P or Fitch (Baa or higher by Moody’s) are considered to be investment-grade quality. Credit ratings are based largely on the ratings agency’s analysis at the time of rating. The rating assigned to any particular security is not necessarily a reflection of the issuer’s current financial condition and does not necessarily reflect its assessment of the volatility of a security’s market value or of the liquidity of an investment in the security. Holdings designated as “Not Rated” (if any) are not rated by the national ratings agencies stated above. |
| 2 | The chart includes the municipal bonds held by a trust that issues residual interest bonds, consistent with the Portfolio of Investments. |
3
Eaton Vance
California Municipal Bond Fund
March 31, 2025
Performance
Portfolio Manager(s) Trevor G.
Smith and Carl A. Thompson, CFA
| % Average Annual Total Returns1,2 | Inception Date | Six Months | One Year | Five Years | Ten Years |
| Fund at NAV | 08/30/2002 | (3.79)% | (0.49)% | 0.12% | 1.91% |
| Fund at Market Price | — | (1.35) | 3.29 | 1.91 | 2.10 |
|
| |||||
| Bloomberg Municipal Bond Index | — | (1.44)% | 1.22% | 1.07% | 2.12% |
| % Premium/Discount to NAV3 | |
| As of period end | (5.41)% |
| Distributions 4 | |
| Total Distributions per share for the period | $0.25 |
| Distribution Rate at NAV | 5.11% |
| Taxable-Equivalent Distribution Rate at NAV | 11.12 |
| Distribution Rate at Market Price | 5.40 |
| Taxable-Equivalent Distribution Rate at Market Price | 11.76 |
| % Total Leverage5 | |
| RIB Financing | 28.16% |
See Endnotes and Additional Disclosures in this report.
Past performance is no guarantee of future results.
Returns are historical and are calculated net of management fees and other expenses by determining the percentage change in net asset value (NAV) or market price (as applicable) with all distributions reinvested in accordance with the Fund’s
Dividend Reinvestment Plan. Furthermore, returns do not reflect the deduction of taxes that shareholders may have to pay on Fund distributions or upon the sale of Fund shares. Performance at market price will differ from performance at NAV due to
variations in the Fund’s market price versus NAV, which may reflect factors such as fluctuations in supply and demand for Fund shares, changes in Fund distributions, shifting market expectations for the Fund’s future returns and
distribution rates, and other considerations affecting the trading prices of closed-end funds. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance for
periods less than or equal to one year is cumulative. Performance is for the stated time period only; due to market volatility, current Fund performance may be lower or higher than the quoted return. For performance as of the most recent month-end,
please refer to eatonvance.com.
4
Eaton Vance
California Municipal Bond Fund
March 31, 2025
Fund Profile
| Credit Quality (% of total investments)1,2 |
Footnotes:
| 1 | For purposes of the Fund’s rating restrictions, ratings are based on Moody’s Investors Service, Inc. (“Moody’s”), S&P Global Ratings (“S&P”) or Fitch Ratings (“Fitch”), as applicable. If securities are rated differently by the ratings agencies, the highest rating is applied. Ratings, which are subject to change, apply to the creditworthiness of the issuers of the underlying securities and not to the Fund or its shares. Credit ratings measure the quality of a bond based on the issuer’s creditworthiness, with ratings ranging from AAA, being the highest, to D, being the lowest based on S&P’s measures. Ratings of BBB or higher by S&P or Fitch (Baa or higher by Moody’s) are considered to be investment-grade quality. Credit ratings are based largely on the ratings agency’s analysis at the time of rating. The rating assigned to any particular security is not necessarily a reflection of the issuer’s current financial condition and does not necessarily reflect its assessment of the volatility of a security’s market value or of the liquidity of an investment in the security. Holdings designated as “Not Rated” (if any) are not rated by the national ratings agencies stated above. |
| 2 | The chart includes the municipal bonds held by a trust that issues residual interest bonds, consistent with the Portfolio of Investments. |
5
Eaton Vance
New York Municipal Bond Fund
March 31, 2025
Performance
Portfolio Manager(s)
Christopher J. Eustance, CFA and Paul Metheny, CFA
| % Average Annual Total Returns1,2 | Inception Date | Six Months | One Year | Five Years | Ten Years |
| Fund at NAV | 08/30/2002 | (5.12)% | (1.29)% | (0.72)% | 1.17% |
| Fund at Market Price | — | (2.24) | 2.79 | 0.29 | 1.61 |
|
| |||||
| Bloomberg Municipal Bond Index | — | (1.44)% | 1.22% | 1.07% | 2.12% |
| % Premium/Discount to NAV3 | |
| As of period end | (5.85)% |
| Distributions 4 | |
| Total Distributions per share for the period | $0.25 |
| Distribution Rate at NAV | 4.96% |
| Taxable-Equivalent Distribution Rate at NAV | 10.28 |
| Distribution Rate at Market Price | 5.27 |
| Taxable-Equivalent Distribution Rate at Market Price | 10.92 |
| % Total Leverage5 | |
| RIB Financing | 29.87% |
See Endnotes and Additional Disclosures in this report.
Past performance is no guarantee of future results.
Returns are historical and are calculated net of management fees and other expenses by determining the percentage change in net asset value (NAV) or market price (as applicable) with all distributions reinvested in accordance with the Fund’s
Dividend Reinvestment Plan. Furthermore, returns do not reflect the deduction of taxes that shareholders may have to pay on Fund distributions or upon the sale of Fund shares. Performance at market price will differ from performance at NAV due to
variations in the Fund’s market price versus NAV, which may reflect factors such as fluctuations in supply and demand for Fund shares, changes in Fund distributions, shifting market expectations for the Fund’s future returns and
distribution rates, and other considerations affecting the trading prices of closed-end funds. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance for
periods less than or equal to one year is cumulative. Performance is for the stated time period only; due to market volatility, current Fund performance may be lower or higher than the quoted return. For performance as of the most recent month-end,
please refer to eatonvance.com.
6
Eaton Vance
New York Municipal Bond Fund
March 31, 2025
Fund Profile
| Credit Quality (% of total investments)1,2 |
Footnotes:
| 1 | For purposes of the Fund’s rating restrictions, ratings are based on Moody’s Investors Service, Inc. (“Moody’s”), S&P Global Ratings (“S&P”) or Fitch Ratings (“Fitch”), as applicable. If securities are rated differently by the ratings agencies, the highest rating is applied. Ratings, which are subject to change, apply to the creditworthiness of the issuers of the underlying securities and not to the Fund or its shares. Credit ratings measure the quality of a bond based on the issuer’s creditworthiness, with ratings ranging from AAA, being the highest, to D, being the lowest based on S&P’s measures. Ratings of BBB or higher by S&P or Fitch (Baa or higher by Moody’s) are considered to be investment-grade quality. Credit ratings are based largely on the ratings agency’s analysis at the time of rating. The rating assigned to any particular security is not necessarily a reflection of the issuer’s current financial condition and does not necessarily reflect its assessment of the volatility of a security’s market value or of the liquidity of an investment in the security. Holdings designated as “Not Rated” (if any) are not rated by the national ratings agencies stated above. |
| 2 | The chart includes the municipal bonds held by a trust that issues residual interest bonds, consistent with the Portfolio of Investments. |
7
Eaton Vance
Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited)
9
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited) — continued
10
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited) — continued
11
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited) — continued
12
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited) — continued
13
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited) — continued
| BAM | – Build America Mutual Assurance Co. |
| BHAC | – Berkshire Hathaway Assurance Corp. |
| FGIC | – Financial Guaranty Insurance Company |
| FHLMC | – Federal Home Loan Mortgage Corp. |
| FNMA | – Federal National Mortgage Association |
| GNMA | – Government National Mortgage Association |
| NPFG | – National Public Finance Guarantee Corp. |
| PSF | – Permanent School Fund |
| SFMR | – Single Family Mortgage Revenue |
| XLCA | – XL Capital Assurance, Inc. |
14
See Notes to Financial Statements.
Eaton Vance
California Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited)
15
See Notes to Financial Statements.
Eaton Vance
California Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited) — continued
16
See Notes to Financial Statements.
Eaton Vance
California Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited) — continued
17
See Notes to Financial Statements.
Eaton Vance
California Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited) — continued
| The Fund invests primarily in debt securities issued by California municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. At March 31, 2025, 21.9% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution or financial guaranty assurance agency ranged from 2.0% to 12.6% of total investments. |
| Abbreviations: | |
| AGM | – Assured Guaranty Municipal Corp. |
| AMT | – Interest earned from these securities may be considered a tax preference item for purposes of the Federal Alternative Minimum Tax. |
| BAM | – Build America Mutual Assurance Co. |
| FNMA | – Federal National Mortgage Association |
| NPFG | – National Public Finance Guarantee Corp. |
18
See Notes to Financial Statements.
Eaton Vance
New York Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited)
19
See Notes to Financial Statements.
Eaton Vance
New York Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited) — continued
20
See Notes to Financial Statements.
Eaton Vance
New York Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited) — continued
21
See Notes to Financial Statements.
Eaton Vance
New York Municipal Bond Fund
March 31, 2025
Portfolio of
Investments (Unaudited) — continued
| The percentage shown for each investment category in the Portfolio of Investments is based on net assets. | |
| (1) | Security represents the municipal bond held by a trust that issues residual interest bonds (see Note 1G). |
| (2) | Security exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be sold in certain transactions in reliance on an exemption from registration (normally to qualified institutional buyers). At March 31, 2025, the aggregate value of these securities is $2,581,216 or 1.4% of the Fund's net assets. |
| (3) | Variable rate demand obligation that may be tendered at par on any day for payment the lesser of 5 business days or 7 calendar days. The stated interest rate, which generally resets weekly, is determined by the remarketing agent and represents the rate in effect at March 31, 2025. |
| (4) | Variable rate demand obligation that may be tendered at par on any day for payment the same or next business day. The stated interest rate, which generally resets daily, is determined by the remarketing agent and represents the rate in effect at March 31, 2025. |
| The Fund invests primarily in debt securities issued by New York municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. At March 31, 2025, 11.9% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution or financial guaranty assurance agency ranged from 0.6% to 9.0% of total investments. | |
| Abbreviations: | |
| AGC | – Assured Guaranty Corp. |
| AGM | – Assured Guaranty Municipal Corp. |
| AMBAC | – AMBAC Financial Group, Inc. |
| AMT | – Interest earned from these securities may be considered a tax preference item for purposes of the Federal Alternative Minimum Tax. |
| BAM | – Build America Mutual Assurance Co. |
| FHLMC | – Federal Home Loan Mortgage Corp. |
| FNMA | – Federal National Mortgage Association |
| GNMA | – Government National Mortgage Association |
| Liq | – Liquidity Provider |
| SPA | – Standby Bond Purchase Agreement |
22
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Funds
March 31, 2025
Statements of Assets
and Liabilities (Unaudited)
| March 31, 2025 | |||
| Municipal Fund | California Fund | New York Fund | |
| Assets | |||
| Investments: | |||
| Identified cost | $ 890,333,918 | $ 350,712,166 | $ 264,151,948 |
| Unrealized appreciation (depreciation) | 3,905,079 | (6,350,298) | (8,443,053) |
| Investments, at value | $ 894,238,997 | $344,361,868 | $255,708,895 |
| Cash | $ — | $ 294,208 | $ 1,337,642 |
| Interest receivable | 11,406,138 | 3,019,963 | 3,246,024 |
| Receivable for investments sold | 5,000 | 13,938,815 | 7,102,634 |
| Trustees' deferred compensation plan | 306,112 | 102,814 | 75,255 |
| Due from broker for floating rate notes issued | — | 320,000 | — |
| Total assets | $ 905,956,247 | $362,037,668 | $267,470,450 |
| Liabilities | |||
| Payable for floating rate notes issued | $ 317,222,974 | $ 94,677,179 | $ 77,048,474 |
| Due to broker for floating rate notes redeemed | — | 12,000,000 | 8,625,000 |
| Payable for when-issued securities | — | 13,010,383 | — |
| Due to custodian | 551,927 | — | — |
| Payable to affiliates: | |||
| Investment adviser fee | 465,501 | 175,916 | 138,232 |
| Trustees' deferred compensation plan | 306,112 | 102,814 | 75,255 |
| Interest expense and fees payable | 2,923,741 | 461,554 | 609,755 |
| Accrued expenses | 115,476 | 58,978 | 61,125 |
| Total liabilities | $ 321,585,731 | $120,486,824 | $ 86,557,841 |
| Net Assets | $ 584,370,516 | $241,550,844 | $180,912,609 |
| Sources of Net Assets | |||
| Common shares, $0.01 par value, unlimited number of shares authorized | $ 540,764 | $ 246,729 | $ 179,613 |
| Additional paid-in capital | 685,241,168 | 304,538,454 | 226,102,264 |
| Accumulated loss | (101,411,416) | (63,234,339) | (45,369,268) |
| Net Assets | $ 584,370,516 | $241,550,844 | $180,912,609 |
| Common Shares Issued and Outstanding | 54,076,420 | 24,672,939 | 17,961,289 |
| Net Asset Value Per Common Share | |||
| Net assets ÷ common shares issued and outstanding | $ 10.81 | $ 9.79 | $ 10.07 |
23
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Funds
March 31, 2025
Statements of
Operations (Unaudited)
| Six Months Ended March 31, 2025 | |||
| Municipal Fund | California Fund | New York Fund | |
| Investment Income | |||
| Interest income | $ 20,976,638 | $ 7,202,768 | $ 5,909,051 |
| Total investment income | $ 20,976,638 | $ 7,202,768 | $ 5,909,051 |
| Expenses | |||
| Investment adviser fee | $ 2,843,526 | $ 1,003,595 | $ 824,776 |
| Trustees’ fees and expenses | 30,915 | 10,632 | 9,030 |
| Custodian fee | 106,029 | 36,607 | 29,660 |
| Transfer and dividend disbursing agent fees | 53,522 | 9,088 | 9,000 |
| Legal and accounting services | 283,775 | 302,858 | 237,795 |
| Printing and postage | 92,063 | 50,640 | 37,822 |
| Interest expense and fees | 5,573,636 | 1,547,805 | 1,484,864 |
| Miscellaneous | 99,329 | 67,721 | 41,158 |
| Total expenses | $ 9,082,795 | $ 3,028,946 | $ 2,674,105 |
| Net investment income | $ 11,893,843 | $ 4,173,822 | $ 3,234,946 |
| Realized and Unrealized Gain (Loss) | |||
| Net realized gain (loss): | |||
| Investment transactions | $ (4,114,388) | $ (2,668,705) | $ (1,065,301) |
| Net realized loss | $ (4,114,388) | $ (2,668,705) | $ (1,065,301) |
| Change in unrealized appreciation (depreciation): | |||
| Investments | $ (32,781,444) | $ (11,848,642) | $ (12,573,840) |
| Net change in unrealized appreciation (depreciation) | $(32,781,444) | $(11,848,642) | $(12,573,840) |
| Net realized and unrealized loss | $(36,895,832) | $(14,517,347) | $(13,639,141) |
| Net decrease in net assets from operations | $(25,001,989) | $(10,343,525) | $(10,404,195) |
24
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Funds
March 31, 2025
Statements of Changes
in Net Assets
| Six Months Ended March 31, 2025 (Unaudited) | |||
| Municipal Fund | California Fund | New York Fund | |
| Increase (Decrease) in Net Assets | |||
| From operations: | |||
| Net investment income | $ 11,893,843 | $ 4,173,822 | $ 3,234,946 |
| Net realized loss | (4,114,388) | (2,668,705) | (1,065,301) |
| Net change in unrealized appreciation (depreciation) | (32,781,444) | (11,848,642) | (12,573,840) |
| Net decrease in net assets from operations | $ (25,001,989) | $ (10,343,525) | $ (10,404,195) |
| Distributions to common shareholders | $ (16,916,244)* | $ (6,173,169)* | $ (4,493,915)* |
| Capital share transactions: | |||
| Cost of shares repurchased in tender offer (see Note 5) | $ (30,642,542) | $ — | $ — |
| Net decrease in net assets from capital share transactions | $ (30,642,542) | $ — | $ — |
| Net decrease in net assets | $ (72,560,775) | $ (16,516,694) | $ (14,898,110) |
| Net Assets | |||
| At beginning of period | $ 656,931,291 | $ 258,067,538 | $ 195,810,719 |
| At end of period | $584,370,516 | $241,550,844 | $180,912,609 |
| * | A portion of the distributions may be deemed a tax return of capital at year-end. See Note 2. |
25
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Funds
March 31, 2025
Statements of Changes
in Net Assets — continued
| Year Ended September 30, 2024 | |||
| Municipal Fund | California Fund | New York Fund | |
| Increase (Decrease) in Net Assets | |||
| From operations: | |||
| Net investment income | $ 27,375,518 | $ 8,210,267 | $ 6,407,410 |
| Net realized loss | (3,664,438) | (3,031,620) | (2,610,818) |
| Net change in unrealized appreciation (depreciation) | 76,901,773 | 27,638,674 | 25,698,790 |
| Net increase in net assets from operations | $ 100,612,853 | $ 32,817,321 | $ 29,495,382 |
| Distributions to common shareholders | $ (27,412,271) | $ (8,115,613) | $ (6,276,735) |
| Tax return of capital to common shareholders | $ (8,350,742) | $ (2,802,163) | $ (1,816,622) |
| Capital share transactions: | |||
| Cost of shares repurchased in tender offer (see Note 5) | $ (157,836,264) | $ — | $ — |
| Net decrease in net assets from capital share transactions | $(157,836,264) | $ — | $ — |
| Net increase (decrease) in net assets | $ (92,986,424) | $ 21,899,545 | $ 21,402,025 |
| Net Assets | |||
| At beginning of year | $ 749,917,715 | $ 236,167,993 | $ 174,408,694 |
| At end of year | $ 656,931,291 | $258,067,538 | $195,810,719 |
26
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Funds
March 31, 2025
Statements of Cash
Flows (Unaudited)
| Six Months Ended March 31, 2025 | |||
| Municipal Fund | California Fund | New York Fund | |
| Cash Flows From Operating Activities | |||
| Net decrease in net assets from operations | $ (25,001,989) | $ (10,343,525) | $ (10,404,195) |
| Adjustments to reconcile net decrease in net assets from operations to net cash provided by (used in) operating activities: | |||
| Investments purchased | (68,426,617) | (101,284,790) | (31,776,012) |
| Investments sold | 115,216,545 | 77,846,448 | 35,506,604 |
| Net amortization/accretion of premium (discount) | (381,530) | 173,545 | 228,432 |
| Decrease (increase) in interest receivable | (111,680) | 281,497 | (55,892) |
| Decrease in Trustees’ deferred compensation plan | 5,990 | 2,003 | 1,422 |
| Increase (decrease) in payable to affiliates for investment adviser fee | (17,172) | 10,074 | (96) |
| Decrease in interest expense and fees payable | (617,268) | (171,350) | (248,941) |
| Decrease in payable to affiliates for Trustees' deferred compensation plan | (5,990) | (2,003) | (1,422) |
| Decrease in accrued expenses | (256,518) | (115,520) | (114,323) |
| Net change in unrealized (appreciation) depreciation from investments | 32,781,444 | 11,848,642 | 12,573,840 |
| Net realized loss from investments | 4,114,388 | 2,668,705 | 1,065,301 |
| Net cash provided by (used in) operating activities | $ 57,299,603 | $ (19,086,274) | $ 6,774,718 |
| Cash Flows From Financing Activities | |||
| Cash distributions paid to common shareholders | $ (16,916,244) | $ (6,173,169) | $ (4,493,915) |
| Repurchases of common shares in tender offer | (30,642,542) | — | — |
| Proceeds from secured borrowings | — | 47,600,000 | — |
| Repayment of secured borrowings | (9,645,000) | (21,200,000) | (575,000) |
| Decrease in due to custodian | (2,345,817) | (846,349) | (368,161) |
| Net cash provided by (used in) financing activities | $ (59,549,603) | $ 19,380,482 | $ (5,437,076) |
| Net increase (decrease) in cash | $ (2,250,000) | $ 294,208 | $ 1,337,642 |
| Cash and restricted cash at beginning of period | $ 2,250,000 | $ — | $ — |
| Cash at end of period | $ — | $ 294,208 | $ 1,337,642 |
| Supplemental disclosure of cash flow information: | |||
| Cash paid for interest and fees | $ 6,190,904 | $ 1,719,155 | $ 1,733,805 |
27
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Funds
March 31, 2025
Financial
Highlights
| Municipal Fund | ||||||
| Six
Months Ended March 31, 2025 (Unaudited) |
Year Ended September 30, | |||||
| 2024 | 2023 | 2022 | 2021 | 2020 | ||
| Net asset value — Beginning of period | $ 11.54 | $ 10.54 | $ 10.85 | $ 13.95 | $ 14.05 | $ 13.98 |
| Income (Loss) From Operations | ||||||
| Net investment income(1) | $ 0.21 | $ 0.40 | $ 0.39 | $ 0.52 | $ 0.59 | $ 0.57 |
| Net realized and unrealized gain (loss) | (0.65) | 1.08 | (0.30) | (3.07) | (0.09) | 0.03 |
| Total income (loss) from operations | $ (0.44) | $ 1.48 | $ 0.09 | $ (2.55) | $ 0.50 | $ 0.60 |
| Less Distributions | ||||||
| From net investment income | $ (0.30)* | $ (0.40) | $ (0.39) | $ (0.55) | $ (0.60) | $ (0.56) |
| Tax return of capital | — | (0.13) | (0.03) | — | — | — |
| Total distributions | $ (0.30) | $ (0.53) | $ (0.42) | $ (0.55) | $ (0.60) | $ (0.56) |
| Anti-dilutive effect of share repurchase program (see Note 5)(1) | $ — | $ — | $ 0.02 | $ — | $ — | $ — |
| Discount on tender offer (see Note 5)(1) | $ 0.01 | $ 0.05 | $ — | $ — | $ — | $ 0.03 |
| Net asset value — End of period | $ 10.81 | $ 11.54 | $ 10.54 | $ 10.85 | $ 13.95 | $ 14.05 |
| Market value — End of period | $ 9.97 | $ 10.76 | $ 8.96 | $ 9.68 | $ 13.38 | $ 13.17 |
| Total Investment Return on Net Asset Value(2) | (3.54)% (3) | 15.31% | 1.30% | (18.50)% | 3.75% | 4.99% |
| Total Investment Return on Market Value(2) | (4.58)% (3) | 26.47% | (3.47)% | (24.19)% | 6.16% | 6.15% |
| Ratios/Supplemental Data | ||||||
| Net assets, end of period (000’s omitted) | $584,371 | $656,931 | $749,918 | $780,476 | $1,003,822 | $1,011,234 |
| Ratios (as a percentage of average daily net assets):(4) | ||||||
| Expenses excluding interest and fees | 1.13% (5) | 0.97% | 1.05% | 1.09% | 1.09% | 1.13% |
| Interest and fee expense(6) | 1.79% (5) | 1.78% | 2.12% | 0.78% | 0.41% | 1.05% |
| Total expenses | 2.92% (5) | 2.75% | 3.17% | 1.87% | 1.50% | 2.18% |
| Net expenses | 2.92% (5) | 2.75% | 3.17% | 1.87% | 1.50% | 2.18% |
| Net investment income | 3.82% (5) | 3.57% | 3.44% | 4.12% | 4.18% | 4.09% |
| Portfolio Turnover | 7% (3) | 41% | 52% | 35% | 10% | 7% |
| (1) | Computed using average shares outstanding. |
| (2) | Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested. Distributions are assumed to be reinvested at prices obtained under the Fund's dividend reinvestment plan. |
| (3) | Not annualized. |
| (4) | Total expenses do not reflect amounts reimbursed and/or waived by the adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. |
| (5) | Annualized. |
| (6) | Interest and fee expense relates to the liability for floating rate notes issued in conjunction with residual interest bond transactions (see Note 1G). |
| * | A portion of the distributions may be deemed a tax return of capital at year-end. See Note 2. |
28
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Funds
March 31, 2025
Financial
Highlights — continued
| California Fund | ||||||
| Six
Months Ended March 31, 2025 (Unaudited) |
Year Ended September 30, | |||||
| 2024 | 2023 | 2022 | 2021 | 2020 | ||
| Net asset value — Beginning of period | $ 10.46 | $ 9.57 | $ 9.73 | $ 12.47 | $ 12.66 | $ 12.57 |
| Income (Loss) From Operations | ||||||
| Net investment income(1) | $ 0.17 | $ 0.33 | $ 0.33 | $ 0.43 | $ 0.50 | $ 0.47 |
| Net realized and unrealized gain (loss) | (0.59) | 1.00 | (0.13) | (2.73) | (0.19) | 0.08 |
| Total income (loss) from operations | $ (0.42) | $ 1.33 | $ 0.20 | $ (2.30) | $ 0.31 | $ 0.55 |
| Less Distributions | ||||||
| From net investment income | $ (0.25)* | $ (0.33) | $ (0.31) | $ (0.45) | $ (0.50) | $ (0.46) |
| Tax return of capital | — | (0.11) | (0.05) | (0.01) | — | — |
| Total distributions | $ (0.25) | $ (0.44) | $ (0.36) | $ (0.46) | $ (0.50) | $ (0.46) |
| Anti-dilutive effect of share repurchase program (see Note 5)(1) | $ — | $ — | $ — | $ 0.02 | $ — | $ — |
| Net asset value — End of period | $ 9.79 | $ 10.46 | $ 9.57 | $ 9.73 | $ 12.47 | $ 12.66 |
| Market value — End of period | $ 9.27 | $ 9.65 | $ 8.12 | $ 8.51 | $ 11.94 | $ 11.36 |
| Total Investment Return on Net Asset Value(2) | (3.79)% (3) | 14.61% | 2.50% | (18.37)% | 2.78% | 4.93% |
| Total Investment Return on Market Value(2) | (1.35)% (3) | 24.62% | (0.56)% | (25.43)% | 9.67% | 4.46% |
| Ratios/Supplemental Data | ||||||
| Net assets, end of period (000’s omitted) | $241,551 | $258,068 | $236,168 | $240,051 | $311,635 | $316,361 |
| Ratios (as a percentage of average daily net assets):(4) | ||||||
| Expenses excluding interest and fees | 1.19% (5) | 0.94% | 1.07% | 1.14% | 1.11% | 1.12% |
| Interest and fee expense(6) | 1.23% (5) | 1.46% | 1.97% | 0.85% | 0.40% | 1.00% |
| Total expenses | 2.42% (5) | 2.40% | 3.04% | 1.99% | 1.51% | 2.12% |
| Net expenses | 2.42% (5) | 2.40% | 3.04% | 1.99% | 1.51% | 2.12% |
| Net investment income | 3.33% (5) | 3.25% | 3.22% | 3.81% | 3.96% | 3.76% |
| Portfolio Turnover | 27% (3) | 20% | 37% | 43% | 19% | 20% |
| (1) | Computed using average shares outstanding. |
| (2) | Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested. Distributions are assumed to be reinvested at prices obtained under the Fund's dividend reinvestment plan. |
| (3) | Not annualized. |
| (4) | Total expenses do not reflect amounts reimbursed and/or waived by the adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. |
| (5) | Annualized. |
| (6) | Interest and fee expense relates to the liability for floating rate notes issued in conjunction with residual interest bond transactions (see Note 1G). |
| * | A portion of the distributions may be deemed a tax return of capital at year-end. See Note 2. |
29
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Funds
March 31, 2025
Financial
Highlights — continued
| New York Fund | ||||||
| Six
Months Ended March 31, 2025 (Unaudited) |
Year Ended September 30, | |||||
| 2024 | 2023 | 2022 | 2021 | 2020 | ||
| Net asset value — Beginning of period | $ 10.90 | $ 9.71 | $ 9.91 | $ 13.27 | $ 13.25 | $ 13.48 |
| Income (Loss) From Operations | ||||||
| Net investment income(1) | $ 0.18 | $ 0.36 | $ 0.35 | $ 0.42 | $ 0.49 | $ 0.49 |
| Net realized and unrealized gain (loss) | (0.76) | 1.28 | (0.19) | (3.37) | 0.04 | (0.24) |
| Total income (loss) from operations | $ (0.58) | $ 1.64 | $ 0.16 | $ (2.95) | $ 0.53 | $ 0.25 |
| Less Distributions | ||||||
| From net investment income | $ (0.25)* | $ (0.35) | $ (0.36) | $ (0.42) | $ (0.50) | $ (0.48) |
| Tax return of capital | — | (0.10) | — | — | (0.01) | — |
| Total distributions | $ (0.25) | $ (0.45) | $ (0.36) | $ (0.42) | $ (0.51) | $ (0.48) |
| Anti-dilutive effect of share repurchase program (see Note 5)(1) | $ — | $ — | $ — | $ 0.01 | $ — | $ — |
| Net asset value — End of period | $ 10.07 | $ 10.90 | $ 9.71 | $ 9.91 | $ 13.27 | $ 13.25 |
| Market value — End of period | $ 9.49 | $ 9.96 | $ 8.29 | $ 8.45 | $ 12.27 | $ 11.80 |
| Total Investment Return on Net Asset Value(2) | (5.12)% (3) | 17.61% | 1.82% | (22.30)% | 4.34% | 2.37% |
| Total Investment Return on Market Value(2) | (2.24)% (3) | 25.88% | 1.95% | (28.32)% | 8.30% | (1.21)% |
| Ratios/Supplemental Data | ||||||
| Net assets, end of period (000’s omitted) | $180,913 | $195,811 | $174,409 | $178,046 | $240,448 | $240,042 |
| Ratios (as a percentage of average daily net assets):(4) | ||||||
| Expenses excluding interest and fees | 1.26% (5) | 1.03% | 1.11% | 1.07% | 1.06% | 1.09% |
| Interest and fee expense(6) | 1.57% (5) | 1.82% | 2.33% | 0.66% | 0.35% | 0.93% |
| Total expenses | 2.83% (5) | 2.85% | 3.44% | 1.73% | 1.41% | 2.02% |
| Net expenses | 2.83% (5) | 2.85% | 3.44% | 1.73% | 1.41% | 2.02% |
| Net investment income | 3.43% (5) | 3.36% | 3.29% | 3.55% | 3.65% | 3.68% |
| Portfolio Turnover | 12% (3) | 21% | 54% | 61% | 15% | 31% |
| (1) | Computed using average shares outstanding. |
| (2) | Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested. Distributions are assumed to be reinvested at prices obtained under the Fund's dividend reinvestment plan. |
| (3) | Not annualized. |
| (4) | Total expenses do not reflect amounts reimbursed and/or waived by the adviser and certain of its affiliates, if applicable. Net expenses are net of all reductions and represent the net expenses paid by the Fund. |
| (5) | Annualized. |
| (6) | Interest and fee expense relates to the liability for floating rate notes issued in conjunction with residual interest bond transactions (see Note 1G). |
| * | A portion of the distributions may be deemed a tax return of capital at year-end. See Note 2. |
30
See Notes to Financial Statements.
Eaton Vance
Municipal Bond Funds
March 31, 2025
Notes to Financial
Statements (Unaudited)
1 Significant Accounting Policies
Eaton Vance Municipal Bond Fund (Municipal Fund), Eaton Vance
California Municipal Bond Fund (California Fund) and Eaton Vance New York Municipal Bond Fund (New York Fund), (each individually referred to as the Fund, and collectively, the Funds), are Massachusetts business trusts registered under the
Investment Company Act of 1940, as amended (the 1940 Act). New York Fund is a non-diversified, closed-end management investment company. Municipal Fund and California Fund are diversified closed-end management investment companies. The Funds'
investment objective is to provide current income exempt from regular federal income tax and, in state specific funds, taxes in their specified state and city (if any).
The following is a summary of significant accounting policies
of the Funds. The policies are in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP). Each Fund is an investment company and follows accounting and reporting guidance in the Financial Accounting
Standards Board (FASB) Accounting Standards Codification Topic 946.
A Investment
Valuation—The following methodologies are used to determine the market value or fair value of
investments.
Debt Obligations. Debt obligations are generally valued on the basis of valuations provided by third party pricing services, as derived from such services’ pricing models. Inputs to the models may include, but are not limited to,
reported trades, executable bid and ask prices, broker/dealer quotations, prices or yields of securities with similar characteristics, interest rates, anticipated prepayments, benchmark curves or information pertaining to the issuer, as well as
industry and economic events. The pricing services may use a matrix approach, which considers information regarding securities with similar characteristics to determine the valuation for a security. Short-term debt obligations purchased with a
remaining maturity of sixty days or less for which a valuation from a third party pricing service is not readily available may be valued at amortized cost, which approximates fair value.
Fair Valuation. In connection
with Rule 2a-5 of the 1940 Act, the Trustees have designated a Fund’s investment adviser as its valuation designee. Investments for which valuations or market quotations are not readily available or are deemed unreliable are valued by the
investment adviser, as valuation designee, at fair value using methods that most fairly reflect the security’s “fair value”, which is the amount that a Fund might reasonably expect to receive for the security upon its current sale
in the ordinary course. Each such determination is based on a consideration of relevant factors, which are likely to vary from one pricing context to another. These factors may include, but are not limited to, the type of security, the existence of
any contractual restrictions on the security’s disposition, the price and extent of public trading in similar securities of the issuer or of comparable companies or entities, quotations or relevant information obtained from broker/dealers or
other market participants, information obtained from the issuer, analysts, and/or the appropriate stock exchange (for exchange-traded securities), an analysis of the company’s or entity’s financial statements, and an evaluation of the
forces that influence the issuer and the market(s) in which the security is purchased and sold.
B Investment Transactions and Related Income—Investment transactions for financial statement purposes are accounted for on a trade date basis. Realized
gains and losses on investments sold are determined on the basis of identified cost. Interest income is recorded on the basis of interest accrued, adjusted for amortization of premium or accretion of discount.
C Federal
Taxes—Each Fund’s policy is to comply with the provisions of the Internal Revenue Code
applicable to regulated investment companies and to distribute to shareholders each year substantially all of its taxable, if any, and tax-exempt net investment income, and all or substantially all of its net realized capital gains. Accordingly, no
provision for federal income or excise tax is necessary. Each Fund intends to satisfy conditions which will enable it to designate distributions from the interest income generated by its investments in non-taxable municipal securities, which
are exempt from regular federal income tax when received by each Fund, as exempt-interest dividends. The portion of such interest, if any, earned on private activity bonds issued after August 7, 1986, may be considered a tax preference item to
shareholders.
As of March 31, 2025, the Funds had
no uncertain tax positions that would require financial statement recognition, de-recognition, or disclosure. Each Fund files a U.S. federal income tax return annually after its fiscal year-end, which is subject to examination by the Internal
Revenue Service for a period of three years from the date of filing.
D Legal Fees— Legal fees and other related expenses incurred as part of negotiations of the terms and requirement of capital infusions, or that are expected
to result in the restructuring of, or a plan of reorganization for, an investment are recorded as realized losses. Ongoing expenditures to protect or enhance an investment are treated as operating expenses.
E Use of
Estimates—The preparation of the financial statements in conformity with U.S. GAAP requires management
to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expense during the reporting period. Actual results could differ from those
estimates.
F Indemnifications—Under each Fund’s organizational documents, its officers and Trustees may be indemnified
against certain liabilities and expenses arising out of the performance of their duties to each Fund. Under Massachusetts law, if certain conditions prevail, shareholders of a Massachusetts business trust (such as a Fund) could be deemed
to have personal liability for the obligations of the Fund. However, each Fund’s Declaration of Trust contains an express disclaimer of liability on the part of Fund shareholders and the By-laws provide that the Fund shall assume,
upon request by the shareholder, the defense on behalf of any Fund shareholders. Moreover, the By-laws also provide for indemnification out of Fund property of any shareholder held personally liable solely by reason of being or having been a
shareholder for all loss or expense arising from such liability. Additionally, in
31
Eaton Vance
Municipal Bond Funds
March 31, 2025
Notes to Financial
Statements (Unaudited) — continued
the normal course of
business, each Fund enters into agreements with service providers that may contain indemnification clauses. Each Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against
each Fund that have not yet occurred.
G Floating Rate Notes Issued in Conjunction with
Securities Held—The Funds may invest in residual interest bonds, also referred to as inverse floating
rate securities, whereby a Fund may sell a variable or fixed rate bond for cash to a Special-Purpose Vehicle (the SPV), (which is generally organized as a trust), while at the same time, buying a residual interest in the assets and cash flows of the
SPV. The bond is deposited into the SPV with the same CUSIP number as the bond sold to the SPV by the Fund, and which may have been, but is not required to be, the bond purchased from the Fund (the Bond). The SPV also issues floating rate notes
(Floating Rate Notes) which are sold to third-parties. The residual interest bond held by a Fund gives the Fund the right (1) to cause the holders of the Floating Rate Notes to generally tender their notes at par, and (2) to have the Bond held by
the SPV transferred to the Fund, thereby terminating the SPV. Should the Fund exercise such right, it would generally pay the SPV the par amount due on the Floating Rate Notes and exchange the residual interest bond for the underlying Bond. Pursuant
to generally accepted accounting principles for transfers and servicing of financial assets and extinguishment of liabilities, the Funds account for the transaction described above as a secured borrowing by including the Bond in their Portfolio of
Investments and the Floating Rate Notes as a liability under the caption “Payable for floating rate notes issued” in their Statement of Assets and Liabilities. The Floating Rate Notes have interest rates that generally reset weekly and
their holders have the option to tender their notes to the SPV for redemption at par at each reset date. Accordingly, the fair value of the payable for floating rate notes issued approximates its carrying value. If measured at fair value, the
payable for floating rate notes would have been considered as Level 2 in the fair value hierarchy (see Note 6) at March 31, 2025. Interest expense related to a Fund’s liability with respect to Floating Rate Notes is recorded as incurred.
The SPV may be terminated by the Fund, as noted above, or by the occurrence of certain termination events as defined in the trust agreement, such as a downgrade in the credit quality of the underlying Bond, bankruptcy of or payment failure by the
issuer of the underlying Bond, the inability to remarket Floating Rate Notes that have been tendered due to insufficient buyers in the market, or the failure by the SPV to obtain renewal of the liquidity agreement under which liquidity support is
provided for the Floating Rate Notes up to one year. At March 31, 2025, the amounts of the Funds’ Floating Rate Notes and related interest rates and collateral were as follows:
| Municipal
Fund |
California
Fund |
New
York Fund | |
| Floating Rate Notes Outstanding | $317,222,974 | $ 94,677,179 | $77,048,474 |
| Interest Rate or Range of Interest Rates (%) | 2.87 - 3.27 | 2.91 - 3.20 | 2.90 - 3.07 |
| Collateral for Floating Rate Notes Outstanding | $415,843,713 | $123,430,491 | $99,774,100 |
For the six months ended March
31, 2025, the Funds’ average settled Floating Rate Notes outstanding and the average interest rate (annualized) including fees were as follows:
| Municipal
Fund |
California
Fund |
New
York Fund | |
| Average Floating Rate Notes Outstanding | $323,520,467 | $ 85,587,967 | $85,944,863 |
| Average Interest Rate | 3.46% | 3.63% | 3.46% |
In certain circumstances, the Funds
may enter into shortfall and forbearance agreements with brokers by which a Fund agrees to reimburse the broker for the difference between the liquidation value of the Bond held by the SPV and the liquidation value of the Floating Rate Notes, as
well as any shortfalls in interest cash flows. The Funds had no shortfalls as of March 31, 2025.
The Funds may also purchase residual interest bonds in a
secondary market transaction without first owning the underlying bond. Such transactions are not required to be treated as secured borrowings. Shortfall agreements, if any, related to residual interest bonds purchased in a secondary market
transaction are disclosed in the Portfolio of Investments.
The Funds’ investment policies and restrictions expressly
permit investments in residual interest bonds. Such bonds typically offer the potential for yields exceeding the yields available on fixed rate bonds with comparable credit quality and maturity. These securities tend to underperform the market for
fixed rate bonds in a rising long-term interest rate environment, but tend to outperform the market for fixed rate bonds when long-term interest rates decline. The value and income of residual interest bonds are generally more volatile than that of
a fixed rate bond. The Funds’ investment policies do not allow the Funds to borrow money except as permitted by the 1940 Act. Effective August 19, 2022, the Funds began operating under Rule 18f-4 under the 1940 Act, which, among other things,
governs the use of derivative investments and certain financing transactions by registered investment companies. Consistent with Rule 18f-4, the Funds may treat their investments in residual interest bonds and similar financing transactions as
subject to the asset coverage requirements of Section 18 of the 1940 Act, or as derivatives transactions subject to the Funds’ value-at-risk (VaR)-based limits on leverage risk. Effective October 11, 2023, the Funds have opted to treat such
investments as derivatives transactions. The Funds may change this approach at any time. Residual interest bonds held by the Funds are securities exempt from registration under Rule 144A of the Securities Act of 1933.
32
Eaton Vance
Municipal Bond Funds
March 31, 2025
Notes to Financial
Statements (Unaudited) — continued
H When-Issued Securities and Delayed Delivery
Transactions—The Funds may purchase securities on a delayed delivery or when-issued basis. Payment and
delivery may take place after the customary settlement period for that security. At the time the transaction is negotiated, the price of the security that will be delivered is fixed. The Funds maintain cash and/or security positions for these
commitments such that sufficient liquid assets will be available to make payments upon settlement. Securities purchased on a delayed delivery or when-issued basis are marked-to-market daily and begin earning interest on settlement date. Such
security purchases are subject to the risk that when delivered they will be worth less than the agreed upon payment price. Losses may also arise if the counterparty does not perform under the contract.
I Segment
Reporting—During this reporting period, the Funds adopted FASB Accounting Standards Update No.
2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (ASU 2023-07), which requires incremental disclosures related to a
public entity’s reportable segments. Each Fund operates as a single reportable segment, an investment company whose investment objective is included in Note 1. In connection with the adoption of ASU 2023-07, the Funds' President acts as each
Fund's Chief Operating Decision Maker (CODM), who is responsible for assessing the performance of each Fund's single segment and deciding how to allocate the segment’s resources. To perform this function, the CODM reviews the information in
the Funds' financial statements.
J Interim Financial Statements—The interim financial statements relating to March 31, 2025 and for the six months then ended have
not been audited by an independent registered public accounting firm, but in the opinion of the Funds' management, reflect all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the financial
statements.
2 Distributions to
Shareholders and Income Tax Information
Each Fund intends
to make monthly distributions of net investment income to common shareholders. In addition, at least annually, each Fund intends to distribute all or substantially all of its net realized capital gains. Distributions are recorded on the ex-dividend
date. Distributions to shareholders are determined in accordance with income tax regulations, which may differ from U.S. GAAP. As required by U.S. GAAP, only distributions in excess of tax basis earnings and profits are reported in the financial
statements as a return of capital. Permanent differences between book and tax accounting relating to distributions are reclassified to paid-in capital. For tax purposes, distributions from short-term capital gains are considered to be from ordinary
income.
Distributions in any year may include a return of capital
component. For the six months ended March 31, 2025, the amount of distributions estimated to be a tax return of capital were approximately $4,816,000, $1,878,000 and $1,178,000 for Municipal Fund, California Fund and New York Fund, respectively. The
final determination of tax characteristics of a Fund’s distributions will occur at the end of the year, at which time it will be reported to the shareholders.
At September 30, 2024, the following Funds, for federal income
tax purposes, had deferred capital losses which would reduce the respective Fund’s taxable income arising from future net realized gains on investment transactions, if any, to the extent permitted by the Internal Revenue Code, and thus would
reduce the amount of distributions to shareholders, which would otherwise be necessary to relieve the Funds of any liability for federal income or excise tax. The deferred capital losses are treated as arising on the first day of a Fund’s next
taxable year and retain the same short-term or long-term character as when originally deferred. The amounts of the deferred capital losses are as follows:
| Municipal
Fund |
California
Fund |
New
York Fund | |
| Deferred capital losses: | |||
| Short-term | $66,088,246 | $21,951,636 | $16,071,710 |
| Long-term | $32,714,878 | $30,292,386 | $19,337,344 |
The cost and unrealized appreciation
(depreciation) of investments of each Fund at March 31, 2025, as determined on a federal income tax basis, were as follows:
| Municipal
Fund |
California
Fund |
New
York Fund | |
| Aggregate cost | $ 571,574,028 | $255,608,916 | $185,037,548 |
| Gross unrealized appreciation | $ 17,880,925 | $ 3,757,777 | $ 2,251,777 |
| Gross unrealized depreciation | (12,438,930) | (9,682,004) | (8,628,904) |
| Net unrealized appreciation (depreciation) | $ 5,441,995 | $ (5,924,227) | $ (6,377,127) |
33
Eaton Vance
Municipal Bond Funds
March 31, 2025
Notes to Financial
Statements (Unaudited) — continued
3 Investment Adviser Fee and Other Transactions
with Affiliates
The investment adviser fee is earned by
Eaton Vance Management (EVM), an indirect, wholly-owned subsidiary of Morgan Stanley, as compensation for investment advisory services rendered to each Fund. The investment adviser fee is computed at an annual rate of 0.60% of each Fund’s
average weekly gross assets and is payable monthly. Gross assets of a Fund are calculated by deducting accrued liabilities of the Fund except (i) the principal amount of any indebtedness for money borrowed, including debt securities issued by the
Fund and the amount of floating-rate notes included as a liability in the Fund’s Statement of Assets and Liabilities of up to $801,875,000 for Municipal Fund, $228,750,000 for California Fund and $165,000,000 for New York Fund, and (ii) the
amount of any outstanding preferred shares issued by the Fund. EVM also serves as the administrator of each Fund, but receives no compensation. For the six months ended March 31, 2025, the investment adviser fees were as follows:
| Municipal
Fund |
California
Fund |
New
York Fund | |
| Investment Adviser Fee | $2,843,526 | $1,003,595 | $824,776 |
Trustees and officers of the
Funds who are members of EVM’s organization receive remuneration for their services to the Funds out of the investment adviser fee. Trustees of the Funds who are not affiliated with EVM may elect to defer receipt of all or a
percentage of their annual fees in accordance with the terms of the Trustees Deferred Compensation Plan. Certain officers and Trustees of the Funds are officers of EVM.
4 Purchases and Sales of Investments
Purchases and sales of investments, other than short-term
obligations, for the six months ended March 31, 2025 were as follows:
| Municipal
Fund |
California
Fund |
New
York Fund | |
| Purchases | $ 68,426,617 | $112,068,438 | $31,776,012 |
| Sales | $115,216,483 | $ 91,785,263 | $42,609,238 |
5 Common Shares of
Beneficial Interest
The Funds may issue common shares
pursuant to their dividend reinvestment plans. There were no common shares issued by the Funds for the six months ended March 31, 2025 and the year ended September 30, 2024.
In November 2013, the Board of Trustees initially approved a
share repurchase program for the Funds. Pursuant to the reauthorization of the share repurchase program by the Board of Trustees in March 2019, each Fund is authorized to repurchase up to 10% of its common shares outstanding as of the last day of
the prior calendar year at market prices when shares are trading at a discount to net asset value (NAV). The share repurchase program does not obligate a Fund to purchase a specific amount of shares. There were no repurchases of common shares by the
Funds for the six months ended March 31, 2025 and the year ended September 30, 2024.
On May 6, 2024, Municipal Fund’s Board of Trustees (the
“Board”) authorized a cash tender offer (the “Firm Tender Offer”) by Municipal Fund of up to 20% of its outstanding common shares at a price per share equal to 98% of Municipal Fund’s net asset value (“NAV”)
per share as of the close of regular trading on the New York Stock Exchange (“NYSE”) on the date the Firm Tender Offer expires. On June 7, 2024, Municipal Fund commenced a cash tender offer for up to 14,230,637 of its outstanding shares.
The tender offer expired at 5:00 p.m. Eastern Time on July 9, 2024. The number of properly tendered shares that were purchased was 14,230,637. The purchase price of the properly tendered shares was equal to $11.0913 per share for an aggregate
purchase price of $157,836,264.
The Board also authorized
two conditional cash tender offers, to follow the Firm Tender Offer, for up to 5% of Municipal Fund’s then-outstanding common shares at 98% of NAV per share as of the close of regular trading on the NYSE on the date the tender offer expires,
provided certain conditions are met. If Municipal Fund’s common shares were to trade at an average discount to NAV of more than 7.5% (based upon the average of the difference between its volume-weighted average market price and NAV each
business day during a four-month measurement period, as measured at the close of the period), the condition for a conditional cash tender offer would be met.
The four-month measurement period for the Initial
Conditional Tender Offer was July 9, 2024 through November 8, 2024, during which the condition for the Initial Conditional Tender Offer was met. On December 10, 2024, Municipal Fund commenced a cash tender offer for up to 2,846,127 of its
outstanding common shares. The tender offer expired at 5:00 p.m. Eastern Time on January 10, 2025. The number of properly tendered shares that were purchased was 2,846,127. The purchase price of the properly tendered shares was equal to $10.7664 per
share for an aggregate purchase price of $30,642,542.
34
Eaton Vance
Municipal Bond Funds
March 31, 2025
Notes to Financial
Statements (Unaudited) — continued
On
January 14, 2025, Municipal Fund announced the four-month measurement period for the Second Conditional Tender Offer, beginning March 10, 2025 through July 9, 2025. If the condition for the Second Conditional Offer is met, Municipal Fund will
conduct the Second Conditional Tender Offer within 20 business days after the close of the measurement period.
At March 31, 2025, according to the filings made on Schedule
13D and 13G pursuant to Sections 13(d) and 13(g) of the Securities Exchange Act of 1934, as amended, one entity owned 14.4% of Municipal Fund's common shares, three affiliated entities and two affiliated entities each owned more than 10% of
California Fund's common shares aggregating 29.6%, and three affiliated entities and two affiliated entities each owned more than 10% of New York Fund's common shares aggregating 34.1%.
6 Fair Value Measurements
Under generally accepted accounting principles for fair value
measurements, a three-tier hierarchy to prioritize the assumptions, referred to as inputs, is used in valuation techniques to measure fair value. The three-tier hierarchy of inputs is summarized in the three broad levels listed below.
| • | Level 1 – quoted prices in active markets for identical investments |
| • | Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.) |
| • | Level 3 – significant unobservable inputs (including a fund's own assumptions in determining the fair value of investments) |
In cases where the inputs used to measure fair value fall in
different levels of the fair value hierarchy, the level disclosed is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The inputs or methodology used for valuing securities are not
necessarily an indication of the risk associated with investing in those securities.
At March 31, 2025, the hierarchy of inputs used in valuing the
Funds' investments, which are carried at fair value, were as follows:
| Municipal Fund | ||||
| Asset Description | Level 1 | Level 2 | Level 3 | Total |
| Tax-Exempt Municipal Obligations | $ — | $ 893,886,690 | $ — | $ 893,886,690 |
| Taxable Municipal Obligations | — | 352,307 | — | 352,307 |
| Total Investments | $ — | $894,238,997 | $ — | $894,238,997 |
| California Fund | ||||
| Asset Description | Level 1 | Level 2 | Level 3 | Total |
| Tax-Exempt Municipal Obligations | $ — | $ 331,341,879 | $ — | $ 331,341,879 |
| Taxable Municipal Obligations | — | 13,019,989 | — | 13,019,989 |
| Total Investments | $ — | $344,361,868 | $ — | $344,361,868 |
| New York Fund | ||||
| Asset Description | Level 1 | Level 2 | Level 3 | Total |
| Corporate Bonds | $ — | $ 965,100 | $ — | $ 965,100 |
| Tax-Exempt Municipal Obligations | — | 252,320,665 | — | 252,320,665 |
| Taxable Municipal Obligations | — | 2,423,130 | — | 2,423,130 |
| Total Investments | $ — | $255,708,895 | $ — | $255,708,895 |
35
Eaton Vance
Municipal Bond Funds
March 31, 2025
Officers and
Trustees
| Officers | |
| Kenneth
A. Topping President |
Nicholas
S. Di Lorenzo Secretary |
| Deidre
E. Walsh Vice President and Chief Legal Officer |
Laura T.
Donovan Chief Compliance Officer |
| James
F. Kirchner Treasurer |
|
| Trustees |
36
Eaton Vance Funds
| U.S. Customer Privacy Notice | March 2024 |
| FACTS | WHAT DOES EATON VANCE DO WITH YOUR PERSONAL INFORMATION? |
| Why? | Financial companies choose how they share your personal information. Federal law gives consumers the right to limit some but not all sharing. Federal law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do. |
| What? | The
types of personal information we collect and share depend on the product or service you have with us. This information can include:■ Social Security number and income ■ investment experience and risk tolerance ■ checking account information and wire transfer instructions |
| How? | All financial companies need to share customers’ personal information to run their everyday business. In the section below, we list the reasons financial companies can share their customers’ personal information; the reasons Eaton Vance chooses to share; and whether you can limit this sharing. |
| Reasons we can share your personal information | Does
Eaton Vance share? |
Can
you limit this sharing? |
| For our everyday business purposes — such as to process your transactions, maintain your account(s), respond to court orders and legal investigations, or report to credit bureaus | Yes | No |
| For our marketing purposes — to offer our products and services to you | Yes | No |
| For joint marketing with other financial companies | No | We don’t share |
| For our affiliates’ everyday business purposes — information about your transactions and experiences | Yes | No* |
| For our affiliates’ everyday business purposes — information about your creditworthiness | Yes | Yes* |
| For our affiliates to market to you | Yes | Yes* |
| For nonaffiliates to market to you | No | We don’t share |
| To
limit our sharing |
Call toll-free 1-800-262-1122 or email: [email protected]Please note:If you are a new customer, we can begin sharing your information 30 days from the date we sent this notice. When you are no longer our customer, we continue to share your information as described in this notice. However, you can contact us at any time to limit our sharing. |
| Questions? | Call toll-free 1-800-262-1122 or email: [email protected] |
37
Eaton Vance Funds
| U.S. Customer Privacy Notice — continued | March 2024 |
Page 2
| Who we are | |
| Who is providing this notice? | Eaton Vance Management and our investment management affiliates (“Eaton Vance”) (see Affiliates definition below.) |
| What we do | |
| How
does Eaton Vance protect my personal information? |
To protect your personal information from unauthorized access and use, we use security measures that comply with federal law. These measures include computer safeguards and secured files and buildings. We have policies governing the proper handling of customer information by personnel and requiring third parties that provide support to adhere to appropriate security standards with respect to such information. |
| How
does Eaton Vance collect my personal information? |
We
collect your personal information, for example, when you■ open an account or make deposits or withdrawals from your account ■ buy securities from us or make a wire transfer ■ give us your contact informationWe also collect your personal information from others, such as credit bureaus, affiliates, or other companies. |
| Why can’t I limit all sharing? | Federal
law gives you the right to limit only■ sharing for affiliates’ everyday business purposes — information about your creditworthiness ■ affiliates from using your information to market to you ■ sharing for nonaffiliates to market to youState laws and individual companies may give you additional rights to limit sharing. (See below for more on your rights under state law.) |
| What
happens when I limit sharing for an account I hold jointly with someone else? |
Your choices will apply to everyone on your account. |
| Definitions | |
| Affiliates | Companies related by common ownership or control. They can be financial and nonfinancial companies.■ Our affiliates include registered investment advisers such as Eaton Vance Management, Eaton Vance Advisers International Ltd., Boston Management and Research, Calvert Research and Management, Parametric Portfolio Associates LLC, Atlanta Capital Management Company LLC, Morgan Stanley Investment Management Inc., Morgan Stanley Investment Management Co.; registered broker-dealers such as Morgan Stanley Distributors Inc. and Eaton Vance Distributors, Inc. (together, the “Investment Management Affiliates”); and companies with a Morgan Stanley name and financial companies such as Morgan Stanley Smith Barney LLC and Morgan Stanley & Co. (the “Morgan Stanley Affiliates”). |
| Nonaffiliates | Companies not related by common ownership or control. They can be financial and nonfinancial companies.■ Eaton Vance does not share with nonaffiliates so they can market to you. |
| Joint marketing | A formal agreement between nonaffiliated financial companies that together market financial products or services to you.■ Eaton Vance does not jointly market. |
| Other important information | |
38
Eaton Vance Funds
| U.S. Customer Privacy Notice — continued | March 2024 |
Page 3
| *PLEASE NOTE: Eaton Vance does not share your creditworthiness information or your transactions and experiences information with the Morgan Stanley Affiliates, nor does Eaton Vance enable the Morgan Stanley Affiliates to market to you. Your opt outs will prevent Eaton Vance from sharing your creditworthiness information with the Investment Management Affiliates and will prevent the Investment Management Affiliates from marketing their products to you.Vermont: Except as permitted by law, we will not share personal information we collect about Vermont residents with Nonaffiliates unless you provide us with your written consent to share such information.California: Except as permitted by law, we will not share personal information we collect about California residents with Nonaffiliates and we will limit sharing such personal information with our Affiliates to comply with California privacy laws that apply to us. |
39
Eaton Vance Funds
IMPORTANT NOTICES
Delivery of Shareholder Documents. The Securities and Exchange Commission (SEC) permits funds to deliver only one copy of shareholder documents, including prospectuses, proxy statements and
shareholder reports, to fund investors with multiple accounts at the same residential or post office box address. This practice is often called “householding” and it helps eliminate duplicate mailings to shareholders. Equiniti Trust Company, LLC ("EQ"), the closed-end funds transfer agent, or your financial intermediary, may household the mailing of your documents indefinitely unless you instruct EQ, or
your financial intermediary, otherwise. If you would prefer that your Eaton Vance documents not be householded, please contact EQ or your financial intermediary. Your instructions that
householding not apply to delivery of your Eaton Vance documents will typically be effective within 30 days of receipt by EQ or your financial intermediary.
Portfolio
Holdings. Each Eaton Vance Fund and its underlying Portfolio(s) (if applicable) files a schedule of portfolio holdings on Part F to Form N-PORT with the
SEC. Certain information filed on Form N-PORT may be viewed on the Eaton Vance website at www.eatonvance.com, by calling Eaton Vance at 1-800-262-1122 or in the EDGAR database on the SEC’s website at www.sec.gov.
Proxy
Voting. From time to time, funds are required to vote proxies related to the securities held by the funds. The Eaton Vance Funds or their underlying
Portfolios (if applicable) vote proxies according to a set of policies and procedures approved by the Funds’ and Portfolios’ Boards. You may obtain a description of these policies and procedures and information on how the Funds or
Portfolios voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, without charge, upon request, by calling 1-800-262-1122 and by accessing the SEC’s website at www.sec.gov. You may also access
proxy voting information for the Eaton Vance Funds or their underlying Portfolios at www.eatonvance.com/
proxyvoting.
proxyvoting.
Share Repurchase
Program. The Funds' Boards of Trustees have approved a share repurchase program authorizing each Fund to repurchase up to 10% of its common shares
outstanding as of the last day of the prior calendar year in open-market transactions at a discount to net asset value. The repurchase program does not obligate a Fund to purchase a specific amount of shares. The Funds' repurchase activity,
including the number of shares purchased, average price and average discount to net asset value, is disclosed in the Funds' annual and semi-annual reports to shareholders.
Additional Notice to Shareholders. If applicable, a Fund may also redeem or purchase its outstanding preferred shares in order to maintain compliance with regulatory requirements, borrowing or
rating agency requirements or for other purposes as it deems appropriate or necessary.
Closed-End Fund Information. Eaton Vance closed-end funds make fund performance data and certain information about portfolio characteristics available on the Eaton Vance website shortly
after the end of each month. Other information about the funds is available on the website. The funds’ net asset value per share is readily accessible on the Eaton Vance website. Portfolio holdings for the most recent month-end are also posted
to the website approximately 30 days following the end of the month. This information is available at www.eatonvance.com on the fund information pages under “Closed-End Funds & Term Trusts.”
40
(b) Not applicable.
Item 2. Code of Ethics
Not required in this filing.
Item 3. Audit Committee Financial Expert
Not required in this filing.
Item 4. Principal Accountant Fees and Services
Not required in this filing.
Item 5. Audit Committee of Listed Registrants
Not required in this filing.
Item 6. Schedule of Investments
| (a) | Please see schedule of investments contained in the Report to Stockholders included under Item 1 of this Form N-CSR. |
| (b) | Not applicable. |
Item 7. Financial Statements and Financial Highlights for Open-End Management Investment Companies
Not applicable.
Item 8. Changes in and Disagreements with Accountants for Open-End Management Investment Companies
Not applicable.
Item 9. Proxy Disclosures for Open-End Management Investment Companies
Not applicable.
Item 10. Remuneration Paid to Directors, Officers, and Others of Open-End Management Investment Companies
Not applicable.
Item 11. Statement Regarding Basis for Approval of Investment Advisory Contract
Not applicable.
Item 12. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies
Not required in this filing.
Item 13. Portfolio Managers of Closed-End Management Investment Companies
Not required in this filing.
Item 14. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers
| Period |
(a) Total Number of Shares Purchased |
(b) Average Price Paid per Share |
(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs |
(d) Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs |
||||||||||||
| October 1 through October 31 |
0 | 0 | 0 | 0 | ||||||||||||
| November 1 through November 30 |
0 | 0 | 0 | 0 | ||||||||||||
| December 1 through December 31 |
0 | 0 | 0 | 0 | ||||||||||||
| January 1 through January 31 |
2,846,127 | 10.7664 | 0 | 0 | ||||||||||||
| February 1 through February 28 |
0 | 0 | 0 | 0 | ||||||||||||
| March 1 through March 31 |
0 | 0 | 0 | 0 | ||||||||||||
| Total |
2,846,127 | 10.7664 | 0 | 0 | ||||||||||||
On May 6, 2024, the Board of Trustees authorized two conditional cash tender offers for up to 5% of Municipal Bond Fund’s then-outstanding common shares at 98% of NAV per share as of the close of regular trading on the NYSE on the date the tender offer expires, provided certain conditions are met. If Municipal Bond Fund’s common shares were to trade at an average discount to NAV of more than 7.5% (based upon the average of the difference between its volume-weighted average market price and NAV each business day during a four-month measurement period, as measured at the close of the period), the condition for a conditional cash tender offer would be met.
On December 10, 2024, Municipal Bond Fund commenced a cash tender offer for up to 2,846,127 of its outstanding common shares. The tender offer expired at 5:00 p.m. Eastern Time on January 10, 2025. The number of properly tendered shares that were purchased was 2,846,127. The purchase price of the properly tendered shares was equal to $10.7664 per share for an aggregate purchase price of $30,642,542.
Item 15. Submission of Matters to a Vote of Security Holders
There have been no material changes to the procedures by which shareholders may recommend nominee to the Fund’s Board of Trustees since the Fund last provided disclosure in response to this item.
Item 16. Controls and Procedures
| (a) | It is the conclusion of the registrant’s principal executive officer and principal financial officer that the effectiveness of the registrant’s current disclosure controls and procedures (such disclosure controls and procedures having been evaluated within 90 days of the date of this filing) provide reasonable assurance that the information required to be disclosed by the registrant has been recorded, processed, summarized and reported within the time period specified in the Commission’s rules and forms and that the information required to be disclosed by the registrant has been accumulated and communicated to the registrant’s principal executive officer and principal financial officer in order to allow timely decisions regarding required disclosure. |
| (b) | There have been no changes in the registrant’s internal control over financial reporting during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
Item 17. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies
No activity to report for the registrant’s most recent fiscal year end.
Item 18. Recovery of Erroneously Awarded Compensation
Not applicable.
Item 19. Exhibits
| (a)(1) |
Registrant’s Code of Ethics – Not applicable (please see Item 2). | |
| (a)(2)(i) |
Principal Financial Officer’s Section 302 certification. | |
| (a)(2)(ii) |
Principal Executive Officer’s Section 302 certification. | |
| (b) |
Combined Section 906 certification. | |
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.
| Eaton Vance Municipal Bond Fund | ||
| By: | /s/ Kenneth A. Topping | |
| Kenneth A. Topping | ||
| Principal Executive Officer | ||
| Date: | May 28, 2025 | |
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/ James F. Kirchner | |
| James F. Kirchner | ||
| Principal Financial Officer | ||
| Date: | May 28, 2025 | |
| By: | /s/ Kenneth A. Topping | |
| Kenneth A. Topping | ||
| Principal Executive Officer | ||
| Date: | May 28, 2025 | |