First Actively Managed Mutual Fund to Invest in Build America Bonds BOSTON, Nov. 17 /PRNewswire-FirstCall/ -- Eaton Vance Management, a subsidiary of Eaton Vance Corp. (NYSE:EV), announced today the launch of Eaton Vance Build America Bond Fund (the "Fund"), America's first actively managed mutual fund designed for investment in taxable municipal obligations issued under the American Recovery & Reinvestment Act of 2009 ("Build America Bonds"), landmark legislation enacted to provide sweeping stimulus for the U.S. economy. "Build America Bonds represent a win for municipalities, a win for investors and a win for America," said Payson Swaffield, chief income investment officer at Eaton Vance. "Build America Bonds are being used to fund the building and repair of our nation's bridges, highways, transit systems, schools and other infrastructure, often at lower cost than traditional municipal finance. For taxable fixed income investors, Build America Bonds represent an entirely new asset class that can enhance portfolio diversification." Similar to tax-exempt municipal bonds, Build America Bonds are primarily of high credit quality, with approximately half of all Build America Bonds issued to date rated AA or higher and the majority of the remainder rated A. In contrast to tax-exempt bonds, the interest earned on Build America Bonds is taxable to the recipient and issuers of Build America Bonds receive a direct payment from the federal government equal to 35 percent of the interest paid. "For investors, what's compelling about Build America Bonds is their potential for corporate bond-like income combined with the credit quality profile of municipal bonds," said Cynthia Clemson, co-director of Municipal Investments at Eaton Vance and co-manager of Eaton Vance Build America Bond Fund. "Think of Build America Bonds as providing an opportunity to earn yields comparable to similarly rated corporate bonds, but with potentially higher credit quality." With $24.6 billion in municipal bond assets under management as of October 31, 2009, Eaton Vance is a leader in municipal income investing. "We have a research-intensive process, access to institutional pricing and significant experience managing municipal investments," said Craig Brandon, co-portfolio manager of the Fund. "Our municipal investment team is one of the largest and most experienced in America, and investing in Build America Bonds is a natural extension of our municipal capabilities." The Fund will be managed by Cynthia Clemson and Craig Brandon. Ms. Clemson is a vice president of Eaton Vance Management, co-director of Municipal Investments, and portfolio manager of Eaton Vance AMT-Free Municipal Bond Fund and eight other Eaton Vance tax-exempt mutual funds and closed-end funds. She has been with Eaton Vance since 1985. Mr. Brandon is a vice president of Eaton Vance Management and portfolio manager of 10 Eaton Vance tax-exempt mutual funds and closed-end funds. He has been with Eaton Vance since 1998. The Fund offers three classes of shares for purchase, each with a minimum investment of $1,000: Class A (EBABX), Class C (ECBAX) and Class I (EIBAX). Eaton Vance is one of the oldest investment management firms in the United States, with a history dating to 1924. Eaton Vance and its affiliates managed $154.9 billion in assets as of October 31, 2009, offering individuals and institutions a broad array of investment products and wealth management solutions. The Company's long record of providing exemplary service and attractive returns through a variety of market conditions has made Eaton Vance the investment manager of choice for many of today's most discerning investors. For more information about Eaton Vance, visit http://www.eatonvance.com/. About Risk-The amount of public information available about municipal bonds is generally less than that for corporate equities or bonds and the investment performance of the Fund may be more dependent on the analytical abilities of the investment adviser than would be the case for a stock fund or corporate bond fund. The secondary market for municipal bonds also tends to be less well-developed and less liquid than many other securities markets, which may adversely affect the Fund's ability to sell its bonds at attractive prices. Because Build America Bonds are a new form of municipal financing and are subject to the sunset provision described herein, it is difficult to predict the extent to which a market for such bonds will develop, meaning that Build America Bonds may experience greater illiquidity than other municipal obligations. As interest rates rise, the value of Fund shares is likely to decline. Conversely, when interest rates decline, the value of Fund shares is likely to rise. Obligations with longer maturities typically offer higher yields, but involve greater risk because the prices of such obligations are more sensitive to changes in interest rates than obligations with shorter maturities. Changes in economic conditions or other circumstances may reduce the capacity of issuers of fixed income securities to make principal and interest payments and may lead to defaults. Such defaults may reduce the value of Fund shares and income distributions. Investments in obligations rated below A and comparable unrated securities have speculative characteristics because of the credit risk associated with their issuers. The ability of municipalities to issue Build America Bonds expires on December 31, 2010. If this ability is not extended beyond that date, the number of Build America Bonds available in the market will be limited and there can be no assurance that Build America Bonds will be actively traded. In addition, illiquidity may negatively affect the value of the bonds. The values of principal only strips are subject to greater fluctuation in response to changes in market interest rates than bonds which pay interest currently. The Fund will accrue income on these investments and may be required to sell securities to make required income distributions each year. While certain U.S. Government-sponsored agencies (such as the Federal Home Loan Mortgage Corporation and the Federal National Mortgage Association) may be chartered or sponsored by acts of Congress, their securities are neither issued nor guaranteed by the U.S. Treasury. The Fund is an actively managed portfolio and its success depends upon the investment skills and analytical abilities of the investment adviser to develop and effectively implement strategies that achieve the Fund's investment objectives. Investors in the Fund should have a long-term investment perspective and be able to tolerate potentially sharp declines in value. Before investing, prospective investors should consider carefully the Fund's investment objective(s), risks, charges and expenses. The Fund's current prospectus contains this and other information about the Fund and is available through your financial advisor. Read the prospectus carefully before you invest or send money. For further information please call 1-800-262-1122. Not FDIC Insured. Not Bank Guaranteed. May Lose Value. Mutual Funds are distributed by Eaton Vance Distributors, Inc. Two International Place, Boston, MA 02110 DATASOURCE: Eaton Vance Management CONTACT: Media, Robyn Tice of Eaton Vance, +1-617-672-8940, Web Site: http://www.eatonvance.com/

Copyright