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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 811-08743

 

 

Invesco Senior Income Trust

(Exact name of registrant as specified in charter)

 

 

1555 Peachtree Street, N.E.,

Atlanta, Georgia 30309

(Address of principal executive offices) (Zip code)

 

 

Colin Meadows

1555 Peachtree Street, N.E.,

Atlanta, Georgia 30309

(Name and address of agent for service)

 

 

Registrant’s telephone number, including area code: (713) 626-1919

Date of fiscal year end: 2/28

Date of reporting period: 08/31/13

 

 

 


Item 1. Report to Stockholders.


 

 

LOGO   Semiannual Report to Shareholders    August 31, 2013
    
 

 

Invesco Senior Income Trust

 

NYSE: VVR

 

LOGO

 

 

 

 

 

2

  

 

Trust Performance

  
 

 

2

  

 

Portfolio Management Update

  
 

 

3

  

 

Dividend Reinvestment Plan

  
 

 

4

  

 

Schedule of Investments

  
 

 

20

  

 

Financial Statements

  
 

 

23

  

 

Notes to Financial Statements

  
 

 

30

  

 

Financial Highlights

 

 

32

  

 

Approval of Investment Advisory and Sub-Advisory Contracts

 

 

34

  

 

Proxy Results

  

 

 

  Unless otherwise noted, all data provided by Invesco.
 

 

  NOT FDIC INSURED  |  MAY LOSE VALUE  |  NO BANK GUARANTEE


 

Trust Performance

 

 

Performance summary

Cumulative total returns, 2/28/13 to 8/31/13

 

Trust at NAV       4.00 %
Trust at Market Value       -3.10  
CS Leveraged Loan Index       2.40  
           
Market Price Premium to NAV as of 8/31/13       0.38  
Source: Invesco, Bloomberg L.P.    

The performance data quoted represent past performance and cannot guarantee comparable future results; current performance may be lower or higher. Investment return, net asset value (NAV) and common share market price will fluctuate so that you may have a gain or loss when you sell shares. Please visit invesco.com/us for the most recent month-end performance. Performance figures reflect Trust expenses, the reinvestment of distributions (if any) and changes in NAV for performance based on NAV and changes in market price for performance based on market price.

Since the Trust is a closed-end management investment company, shares of the Trust may trade at a discount or premium from the NAV. This characteristic is separate and distinct from the risk that NAV could decrease as a result of investment activities and may be a greater risk to investors expecting to sell their shares after a short time. The Trust cannot predict whether shares will trade at, above or below NAV. The Trust should not be viewed as a vehicle for trading purposes. It is designed primarily for risk-tolerant long-term investors.

The CS Leveraged Loan Index represents tradable, senior-secured, US-dollar-denominated, noninvestment-grade loans.

The Trust is not managed to track the performance of any particular index, including the index described here, and consequently, the performance of the Trust may deviate significantly from the performance of the index.

A direct investment cannot be made in an index. Unless otherwise indicated, index results include reinvested dividends, and they do not reflect sales charges.

 

 

 

 

Portfolio Management Update

The following individuals are jointly and primarily responsible for the day-to-day management of Invesco Senior Income Trust:

    Scott Baskind, portfolio manager, is manager of Invesco Senior Income Trust. He has been associated with Invesco or its investment advisory affiliates since 1999 and began managing the Trust in 2013. Mr. Baskind earned a BS in business administration from University at Albany, The State University of New York.

    Thomas Ewald, portfolio manager, is manager of Invesco Senior Income Trust. He has been associated with Invesco or its investment advisory affiliates since 2000 and began managing the Trust in 2010. He earned a BA from Harvard College and an MBA from the University of Virginia Darden School of Business.

    Philip Yarrow, Chartered Financial Analyst, portfolio manager, is manager of Invesco Senior Income Trust. He joined Invesco in 2010. Mr. Yarrow was associated with the Trust’s previous investment adviser or its investment advisory affiliates from 2005 to 2010 and began managing the Trust in 2007. He earned a BS in mathematics and economics from the University of Nottingham and a Master of Management degree in finance from Northwestern University.

 

 

NYSE Symbol

   VVR

 

 

2                             Invesco Senior Income Trust


 

Dividend Reinvestment Plan

The dividend reinvestment plan (the Plan) offers you a prompt and simple way to reinvest your dividends and capital gains distributions (Distributions) into additional shares of your Invesco closed-end Trust (the Trust). Under the Plan, the money you earn from Distributions will be reinvested automatically in more shares of the Trust, allowing you to potentially increase your investment over time. All shareholders in the Trust are automatically enrolled in the Plan when shares are purchased.

 

 

Plan benefits

n   Add to your account:

You may increase your shares in your Trust easily and automatically with the Plan.

n   Low transaction costs:

Shareholders who participate in the Plan may be able to buy shares at below-market prices when the Trust is trading at a premium to its net asset value (NAV). In addition, transaction costs are low because when new shares are issued by the Trust, there is no brokerage fee, and when shares are bought in blocks on the open market, the per share fee is shared among all participants.

n   Convenience:

You will receive a detailed account statement from Computershare Trust Company, N.A. (the Agent), which administers the Plan. The statement shows your total Distributions, date of investment, shares acquired, and price per share, as well as the total number of shares in your reinvestment account. You can also access your account at invesco.com/us.

n   Safekeeping:

The Agent will hold the shares it has acquired for you in safekeeping.

 

 

Who can participate in the Plan

If you own shares in your own name, your purchase will automatically enroll you in the Plan. If your shares are held in “street name” – in the name of your brokerage firm, bank, or other financial institution – you must instruct that entity to participate on your behalf. If they are unable to participate on your behalf, you may request that they reregister your shares in your own name so that you may enroll in the Plan.

 

 

How to enroll

If you haven’t participated in the Plan in the past or chose to opt out, you are still eligible to participate. Enroll by visiting invesco.com/us, by calling toll-free 800 341 2929 or by notifying us in writing at Invesco Closed-End Funds, Computershare Trust Company, N.A. P.O. Box 43078, Providence, RI 02940-3078. If you are writing to us, please include the Trust name and account number and ensure that all shareholders listed on the account sign these written instructions. Your participation in the Plan will begin with the next Distribution payable after the Agent receives your authorization, as long as they receive it before the “record date,” which is generally 10 business days before the Distribution is paid. If your authorization arrives after such record date, your participation in the Plan will begin with the following Distribution.

 

How the Plan works

If you choose to participate in the Plan, your Distributions will be promptly reinvested for you, automatically increasing your shares. If the Trust is trading at a share price that is equal to its NAV, you’ll pay that amount for your reinvested shares. However, if the Trust is trading above or below NAV, the price is determined by one of two ways:

  1. Premium: If the Trust is trading at a premium – a market price that is higher than its NAV – you’ll pay either the NAV or 95 percent of the market price, whichever is greater. When the Trust trades at a premium, you may pay less for your reinvested shares than an investor purchasing shares on the stock exchange. Keep in mind, a portion of your price reduction may be taxable because you are receiving shares at less than market price.
  2. Discount: If the Trust is trading at a discount – a market price that is lower than its NAV – you’ll pay the market price for your reinvested shares.

 

 

Costs of the Plan

There is no direct charge to you for reinvesting Distributions because the Plan’s fees are paid by the Trust. If the Trust is trading at or above its NAV, your new shares are issued directly by the Trust and there are no brokerage charges or fees. However, if the Trust is trading at a discount, the shares are purchased on the open market, and you will pay your portion of any per share fees. These per share fees are typically less than the standard brokerage charges for individual transactions because shares are purchased for all participants in blocks, resulting in lower fees for each individual participant. Any service or per share fees are added to the purchase price. Per share fees include any applicable brokerage commissions the Agent is required to pay.

 

 

Tax implications

The automatic reinvestment of Distributions does not relieve you of any income tax that may be due on Distributions. You will receive tax information annually to help you prepare your federal income tax return.

Invesco does not offer tax advice. The tax information contained herein is general and is not exhaustive by nature. It was not intended or written to be used, and it cannot be used, by any taxpayer for avoiding penalties that may be imposed on the taxpayer under US federal tax laws. Federal and state tax laws are complex and constantly changing. Shareholders should always consult a legal or tax adviser for information concerning their individual situation.

 

How to withdraw from the Plan

You may withdraw from the Plan at any time by calling 800 341 2929, by visiting invesco.com/us or by writing to Invesco Closed-End Funds, Computershare Trust Company, N.A., P.O. Box 43078, Providence, RI 02940-3078. Simply indicate that you would like to withdraw from the Plan, and be sure to include your Trust name and account number. Also, ensure that all shareholders listed on the account sign these written instructions. If you withdraw, you have three options with regard to the shares held in the Plan:

  1. If you opt to continue to hold your non-certificated whole shares (Investment Plan Book Shares), they will be held by the Agent electronically as Direct Registration Book-Shares (Book-Entry Shares) and fractional shares will be sold at the then-current market price. Proceeds will be sent via check to your address of record after deducting applicable fees, including per share fees such as any applicable brokerage commissions the Agent is required to pay.
  2. If you opt to sell your shares through the Agent, we will sell all full and fractional shares and send the proceeds via check to your address of record after deducting a $2.50 service fee and per share fees. Per share fees include any applicable brokerage commissions the Agent is required to pay.
  3. You may sell your shares through your financial adviser through the Direct Registration System (DRS). DRS is a service within the securities industry that allows Trust shares to be held in your name in electronic format. You retain full ownership of your shares, without having to hold a share certificate. You should contact your financial adviser to learn more about any restrictions or fees that may apply.

The Trust and Computershare Trust Company, N.A. may amend or terminate the Plan at any time. Participants will receive at least 30 days written notice before the effective date of any amendment. In the case of termination, Participants will receive at least 30 days written notice before the record date for the payment of any such Distributions by the Trust. In the case of amendment or termination necessary or appropriate to comply with applicable law or the rules and policies of the Securities and Exchange Commission or any other regulatory authority, such written notice will not be required.

    To obtain a complete copy of the current Dividend Reinvestment Plan, please call our Client Services department at 800 341 2929 or visit invesco.com/us.

 

 

3                             Invesco Senior Income Trust


Schedule of Investments

August 31, 2013

(Unaudited)

 

    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  

Variable Rate Senior Loan Interests–122.35%(a)(b)

  

Aerospace & Defense–2.94%   

Atlantic Aviation FBO Inc., Term Loan

    3.25     06/01/20       $ 106       $ 105,745   

CAMP International Holding Co., First Lien Term Loan

    5.25     05/31/19         1,041         1,053,622   

DAE Aviation Holdings, Inc.,

         

Term Loan B-1

    6.25     10/29/18         2,388         2,417,706   

Term Loan B-2

    6.25     11/02/18         1,082         1,096,027   

IAP Worldwide Services, First Lien Term Loan

    10.00     12/31/15         5,704         3,136,943   

Landmark U.S. Holdings LLC,

         

Canadian Term Loan

    5.75     10/25/19         265         267,628   

First Lien Term Loan

    5.75     10/25/19         3,131         3,158,014   

LMI Aerospace, Inc., Term Loan

    4.75     12/28/18         598         595,291   

PRV Aerospace, LLC, Term Loan

    6.50     05/09/18         2,900         2,922,095   

Sequa Corp., Term Loan

    5.25     06/19/17         3,365         3,389,899   

Transdigm Inc., Term Loan C

    3.75     02/28/20         9,310         9,323,731   
         27,466,701   
Air Transport–1.96%   

American Airlines, Inc., Term Loan B

    4.75     06/27/19         5,586         5,533,783   

Delta Air Lines, Inc.,

         

Revolver Loan(c)

    0.00     04/20/16         7,316         6,949,787   

Revolver Loan(d)

           10/18/17         1,076         995,132   

Revolver Term Loan B-1

    4.00     10/18/18         4,493         4,514,969   

United Continental Holdings, Inc., Term Loan B

    4.00     04/01/19         308         309,063   
         18,302,734   
Automotive–5.14%   

Affinia Group Inc., Term Loan B-2

    4.75     04/27/20         926         928,439   

August U.S. Holding Co., Inc.,

         

First Lien Term Loan B-1 (Acquired 05/03/12; Cost $804,722)

    5.00     04/27/18         818         818,558   

Second Lien Term Loan

    10.50     04/29/19         250         253,280   

Second Lien Term Loan

    10.50     04/29/19         763         773,531   

Term Loan B-1 (Acquired 05/03/12; Cost $619,026)

    5.00     04/27/18         629         629,674   

Autoparts Holdings Ltd., First Lien Term Loan

    6.50     07/28/17         946         913,237   

BBB Industries, LLC, Term Loan

    5.50     03/27/19         2,880         2,891,021   

Federal-Mogul Corp.,

         

Term Loan B

    2.13     12/29/14         3,418         3,342,077   

Term Loan C

    2.13     12/28/15         2,377         2,323,792   

Goodyear Tire & Rubber Co., Second Lien Term Loan

    4.75     04/30/19         3,088         3,112,831   

Hertz Corp. (The),

         

LOC (Acquired 03/14/11; Cost $1,473,130)

    2.75     03/09/18         1,497         1,493,738   

Term Loan B-1

    3.75     03/12/18         762         764,877   

KAR Auction Services, Inc., Term Loan

    3.75     05/19/17         4,712         4,742,440   

Key Safety Systems, Inc., Term Loan

    4.75     05/09/18         2,262         2,288,148   

Keystone Automotive Operations, Inc., First Lien Term Loan

    7.00     08/15/19         1,502         1,509,636   

Metaldyne, LLC, Term Loan

    5.00     12/18/18         2,660         2,685,488   

Schaeffler AG (Germany), Term Loan C

    4.25     01/27/17         4,325         4,343,597   

TI Group Automotive Systems, LLC, Term Loan

    5.50     03/27/19         6,202         6,232,881   

Tower Automotive Holdings USA, LLC, Term Loan

    4.75     04/23/20         3,946         3,973,450   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

4                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  
Automotive–(continued)   

Transtar Holding Co.,

         

First Lien Term Loan

    5.50     10/09/18       $ 3,262       $ 3,292,390   

Second Lien Term Loan

    9.75     10/09/19         728         742,463   
         48,055,548   
Beverage and Tobacco–0.34%   

North American Breweries Holdings, LLC, Term Loan

    7.50     12/11/18         3,151         3,182,836   
Building & Development–3.90%   

Axia Inc.,

         

PIK Second Lien Term Loan A (Acquired 05/30/08-06/28/13; Cost $3,141,492)(e)(f)

    5.00     03/11/16         1,191         1,149,227   

Revolver Loan(c)(e)

    0.00     03/11/16         2,062         1,948,596   

Second Lien Term Loan B (Acquired 05/30/08; Cost $5,515,342)(e)

    5.00     03/12/16         1,918         1,850,689   

Building Materials Holding Corp., PIK Second Lien Term Loan(f)

    8.00     01/05/15         4,441         4,374,289   

Capital Automotive L.P.,

         

Second Lien Term Loan

    6.00     04/30/20         2,598         2,669,309   

Term Loan B-1

    4.00     04/10/19         3,425         3,448,006   

CBRE Services, Inc., Term Loan B

    2.94     03/29/21         919         920,116   

CPG International Inc., Term Loan

    5.75     09/18/19         605         611,636   

Custom Building Products, Inc., Term Loan

    6.00     12/12/19         3,480         3,490,788   

HD Supply Inc., Term Loan

    4.50     10/12/17         4,267         4,289,147   

Lake at Las Vegas Joint Venture, LLC, PIK Exit Revolver Loan (Acquired 07/19/10-01/29/13;
Cost $200,464)(f)

    4.64     02/28/17         200         81,188   

Lake at Las Vegas Joint Venture, LLC, PIK Exit Revolver Loan (Acquired 07/17/12;
Cost $16,242)(c)(f)

    0.00     02/28/17         16         6,578   

Nortek, Inc., Term Loan

    5.25     04/26/17         787         791,107   

Re/Max International, Inc., Term Loan

    5.25     07/31/20         2,151         2,152,718   

Realogy Corp.,

         

LOC

    3.19     10/10/13         570         566,249   

Synthetic LOC

    4.45     10/10/16         29         29,733   

Term Loan B

    4.50     03/05/20         6,220         6,274,112   

WireCo WorldGroup Inc., Term Loan

    6.00     02/15/17         1,735         1,743,286   
         36,396,774   
Business Equipment & Services–9.96%   

Advantage Sales & Marketing Inc., Second Lien Term Loan

    8.25     06/18/18         573         583,425   

Asurion Corp.,

         

Incremental Term Loan B-1

    4.50     05/24/19         11,767         11,657,606   

Incremental Term Loan B-2

    3.50     07/08/20         13,121         12,607,393   

Audio Visual Services Group, Inc., First Lien Term Loan (Acquired 11/09/12; Cost $2,988,280)

    6.75     11/09/18         3,041         3,071,706   

Brock Holdings III, Inc., First Lien Term Loan

    6.01     03/16/17         284         285,249   

Ceridian Corp., Term Loan

    4.43     05/09/17         471         471,862   

Crossmark Holdings, Inc.,

         

First Lien Term Loan

    4.50     12/20/19         2,088         2,083,238   

Second Lien Term Loan

    8.75     12/21/20         731         732,997   

Duff & Phelps Corp., Term Loan

    4.50     04/23/20         785         786,549   

Epiq Systems, Inc., Term Loan

    4.75     08/27/20         2,727         2,724,977   

Expert Global Solutions, Inc., First Lien Term Loan B

    8.50     04/03/18         5,029         5,135,998   

First Data Corp.,

         

Term Loan

    4.18     03/24/17         2,618         2,600,564   

Term Loan

    4.18     03/23/18         14,724         14,614,337   

Term Loan

    4.18     09/24/18         689         682,246   

FS Funding AS (Denmark), Term Loan B12

    3.75     04/30/18         730         732,288   

Helios Holding, Inc., First Lien Term Loan

    6.50     07/13/18         2,994         3,010,620   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

5                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  
Business Equipment & Services–(continued)   

ION Trading Technologies S.a.r.l. (Luxembourg), First Lien Term Loan

    4.50     05/22/20       $ 994       $ 996,588   

Kronos Inc.,

         

First Lien Incremental Term Loan

    4.50     10/30/19         5,702         5,730,458   

Second Lien Term Loan

    9.75     04/30/20         1,121         1,163,861   

Lonestar Intermediate Super Holdings, LLC, Term Loan

    11.00     09/02/19         4,295         4,498,718   

Mitchell International, Inc., Second Lien Term Loan

    5.56     03/30/15         3,897         3,906,425   

SourceHOV LLC,

         

First Lien Term Loan B

    5.25     04/30/18         773         780,216   

Second Lien Term Loan

    8.75     04/30/19         311         315,615   

SunGard Data Systems Inc.,

         

Term Loan C

    3.94     02/28/17         213         214,183   

Term Loan D

    4.50     01/31/20         1,402         1,417,791   

Term Loan E

    4.00     03/09/20         5,625         5,677,809   

TNS Inc.,

         

First Lien Term Loan

    5.00     02/14/20         1,618         1,633,040   

Second Lien Term Loan

    9.00     08/14/20         124         125,542   

Valleycrest Companies LLC, Term Loan

    5.50     06/13/19         1,092         1,094,170   

Wash MultiFamily Laundry Systems, LLC, Term Loan

    5.25     02/21/19         1,185         1,190,895   

West Corp., Revolver Loan(c)

    0.00     01/15/16         2,633         2,474,840   
         93,001,206   
Cable & Satellite Television–4.66%   

Cequel Communications, LLC, Term Loan

    3.50     02/14/19         1,504         1,509,370   

Charter Communications Operating LLC, Term Loan E

    3.00     07/01/20         1,696         1,682,649   

CSC Holdings, LLC, Term Loan B

    2.68     04/17/20         3,903         3,864,940   

Kabel Deutschland GmbH (Germany), Term Loan F1

    3.25     02/01/19         2,868         2,870,275   

MCC Iowa,

         

Term Loan D-2

    1.90     01/30/15         1,882         1,882,790   

Term Loan H

    3.25     01/29/21         3,986         3,953,373   

Media Holdco, L.P., Term Loan

    7.25     07/24/18         2,366         2,377,620   

Mediacom Illinois LLC,

         

Term Loan C

    1.65     01/30/15         2,244         2,244,696   

Term Loan E

    4.50     10/23/17         1,536         1,539,577   

Telecommunications Management, LLC, Term Loan

    5.00     04/30/20         2,268         2,272,643   

UPC Financing Partnership, Term Loan AH

    3.25     06/30/21         2,626         2,621,273   

Virgin Media Investment Holdings Ltd. (United Kingdom), Term Loan B

    3.50     06/08/20         3,862         3,852,628   

WideOpenWest Finance, LLC, Term Loan B

    4.75     04/01/19         5,964         6,015,530   

Yankee Cable Acquisition, LLC, Term Loan

    5.25     03/02/20         6,850         6,882,567   
         43,569,931   
Chemicals & Plastics–6.90%   

AI Chem & Cy S.C.A.,

         

Second Lien Term Loan

    8.25     04/03/20         410         421,845   

Term Loan B-1

    4.50     10/03/19         1,176         1,178,884   

Term Loan B-2

    4.50     10/03/19         610         611,666   

Arysta LifeScience SPC, LLC,

         

First Lien Term Loan

    4.50     05/29/20         5,846         5,857,965   

Second Lien Term Loan

    8.25     11/30/20         960         961,647   

Ascend Performance Materials Operations LLC, Term Loan B

    6.75     04/10/18         5,185         4,990,755   

DuPont Performance Coatings, Inc., Term Loan B

    4.75     02/03/20         12,217         12,325,044   

Emerald Performance Materials, LLC, First Lien Term Loan (Acquired 05/15/12; Cost 1,745,650)

    6.75     05/18/18         1,760         1,777,121   

HII Holding Corp., First Lien Term Loan

    4.00     12/20/19         1,678         1,679,248   

Ineos Holdings Ltd., Term Loan

    4.00     05/04/18         11,187         11,117,496   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

6                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  
Chemicals & Plastics–(continued)          

MacDermid, Inc.,

         

First Lien Term Loan B

    4.00     06/08/20       $ 1,999       $ 2,005,054   

Second Lien Term Loan B

    7.75     12/07/20         341         346,429   

Nusil Technology LLC, Term Loan

    5.25     04/07/17         406         399,673   

OMNOVA Solutions, Inc., Term Loan B-1

    4.25     05/31/18         1,929         1,944,316   

Oxea Finance LLC,

         

First Lien Term Loan B-2

    4.25     01/15/20         3,189         3,192,591   

Second Lien Term Loan

    8.25     07/15/20         1,440         1,442,765   

PQ Corp., Term Loan

    4.50     08/07/17         7,592         7,646,132   

Tata Chemicals North America Inc., Term Loan

    3.75     08/07/20         1,101         1,103,156   

Univar Inc., Term Loan B

    5.00     06/30/17         5,579         5,457,402   
         64,459,189   
Clothing & Textiles–0.23%   

Calceus Acquisition, Inc., Term Loan

    5.75     01/31/20         1,219         1,231,719   

Wolverine World Wide, Inc., Term Loan B

    4.16     07/31/19         939         947,123   
         2,178,842   
Conglomerates–1.46%   

CeramTec Acquisition Corp., Term Loan B-1

    4.25     08/31/20         1,687         1,692,322   

MX Holdings US, Inc., Term Loan B-1

    4.50     08/16/20         2,335         2,348,314   

Rexnord LLC/RBS Global, Inc., Term Loan B

    4.00     08/20/20         7,053         6,991,528   

RGIS Services, LLC,

         

Term Loan

    2.78     04/30/14         911         907,112   

Term Loan C

    5.50     10/18/17         1,207         1,204,435   

Spectrum Brands, Inc., Term Loan C

    3.50     08/13/19         500         497,986   
         13,641,697   
Containers & Glass Products–3.85%   

Berlin Packaging, LLC,

         

First Lien Term Loan

    4.75     04/02/19         2,567         2,576,302   

Second Lien Term Loan

    8.75     04/02/20         934         940,571   

BWAY Holding Co., Term Loan

    4.50     08/07/17         2,420         2,441,510   

Caraustar Industries, Inc., Term Loan

    7.50     05/01/19         1,017         1,038,134   

Consolidated Container Co. LLC, Term Loan

    5.00     07/03/19         1,321         1,333,736   

Exopack, LLC, Term Loan B

    5.00     05/31/17         4,450         4,499,872   

Hoffmaster Group, Inc.,

         

First Lien Term Loan

    6.50     01/03/18         2,267         2,249,942   

Second Lien Term Loan (Acquired 12/29/11; Cost $984,720)

    11.00     01/03/19         1,000         1,005,000   

Pact Group (USA), Inc., Term Loan

    3.75     05/29/20         4,251         4,214,274   

Pertus Sechzehnte GmbH (Germany),

         

Term Loan B2A

    4.56     12/14/16         2,022         2,020,465   

Term Loan C2A

    4.81     06/14/17         2,022         2,020,466   

Ranpak Corp.,

         

First Lien Term Loan

    4.50     04/23/19         565         567,999   

Second Lien Term Loan (Acquired 04/29/13; Cost $629,092)

    8.50     04/23/20         635         652,635   

Reynolds Group Holdings Inc., Revolver Loan(c)

    0.00     11/05/14         5,534         5,528,329   

TricorBraun Inc. Term Loan

    4.00     05/03/18         2,632         2,639,310   

WNA Holdings, Inc.,

         

Second Lien Term Loan (Acquired 06/03/13; Cost $588,085)

    8.50     12/07/20         594         599,886   

Term Loan

    4.50     06/05/20         560         562,591   

Term Loan

    4.50     06/05/20         1,031         1,035,678   
         35,926,700   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

7                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  
Cosmetics & Toiletries–0.18%   

Marietta Intermediate Holding Corp., PIK First Lien Term Loan B (Acquired 09/25/06-02/06/13;
Cost $5,267,974)(f)

    7.00     02/19/15       $ 1,691       $ 1,632,193   
Drugs–1.07%   

Grifols, Inc., Term Loan B

    4.25     06/01/17         493         497,337   

Harlan Laboratories, Inc., Term Loan

    3.77     07/11/14         3,585         3,053,238   

Medpace Intermediateco, Inc., Term Loan B (Acquired 06/21/11-04/22/13; Cost $2,576,506)

    5.25     06/16/17         2,598         2,604,084   

Valeant Pharmaceuticals International, Inc., Series C-1 Term Loan B

    4.38     12/11/19         3,772         3,791,175   
         9,945,834   
Ecological Services & Equipment–1.26%   

ADS Waste Holdings, Inc., Term Loan B

    4.25     10/09/19         1,636         1,642,829   

Environmental Systems Products Holdings Inc., Second Lien Term Loan (Acquired 01/25/12;
Cost $54,329)

    15.50     03/31/17         54         54,329   

Servicemaster Co. (The),

         

LOC

    4.55     01/31/17         2,024         1,932,486   

Term Loan B

    4.44     01/31/17         1,632         1,592,791   

Term Loan C

    4.25     01/31/17         6,694         6,518,508   
         11,740,943   
Electronics & Electrical–6.32%   

Blackboard Inc.,

         

Second Lien Term Loan

    11.50     04/04/19         2,351         2,393,913   

Term Loan B-2

    6.25     10/04/18         8,190         8,248,101   

Blue Coat Systems, Inc., Term Loan

    4.50     05/31/19         1,063         1,066,190   

DEI Sales, Inc., Term Loan

    5.75     07/13/17         2,669         2,667,416   

Deltek, Inc., First Lien Term Loan

    5.00     10/10/18         3,794         3,805,578   

DG FastChannel, Inc., Term Loan

    7.25     07/26/18         3,420         3,394,232   

Freescale Semiconductor, Inc., Term Loan B-4

    5.00     02/28/20         12,081         12,158,471   

Infor (US), Inc.,

         

Term Loan B-2

    5.25     04/05/18         181         182,058   

Term Loan B-3

    3.75     06/03/20         1,189         1,183,468   

Mirion Technologies, Inc., Term Loan

    5.75     03/30/18         3,918         3,917,899   

RP Crown Parent, LLC,

         

First Lien Term Loan

    6.75     12/21/18         4,519         4,574,578   

Second Lien Term Loan

    11.25     12/20/19         763         782,679   

Ship Luxco 3 S.a.r.l. (Luxembourg),

         

Term Loan B2A-II

    5.25     11/29/19         963         970,261   

Term Loan C2

    4.75     11/29/19         1,872         1,882,986   

Sophia, L.P., Term Loan B

    4.50     07/19/18         5,994         6,029,611   

SS&C Technologies, Inc.,

         

Term Loan B-1

    3.50     06/07/19         1,975         1,977,050   

Term Loan B-2

    3.50     06/07/19         204         204,522   

SSI Investments II Ltd., Term Loan

    5.00     05/26/17         2,883         2,915,385   

StoneRiver Group, L.P., First Lien Term Loan

    4.50     11/29/19         713         713,627   
         59,068,025   
Equipment Leasing–0.23%   

Flying Fortress Inc., Term Loan

    3.50     06/30/17         2,155         2,160,301   
Financial Intermediaries–3.80%   

Blackstone Perpetual BidCo B.V. (Netherlands), Term Loan B2

    4.76     02/07/20         1,156         1,151,308   

GEO Group, Inc., Term Loan

    3.25     04/03/20         554         557,854   

iPayment Inc., Term Loan

    6.75     05/08/17         4,922         4,798,473   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

8                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  
Financial Intermediaries–(continued)   

LPL Holdings, Inc., Incremental Term Loan B

    3.25     03/29/19       $ 150       $ 149,166   

MoneyGram International, Inc., Term Loan

    4.25     03/27/20         6,611         6,650,257   

Nuveen Investments, Inc., First Lien Term Loan B

    4.18     05/15/17         14,815         14,774,461   

RJO Holdings Corp.,

         

Term Loan (Acquired 12/10/10; Cost $39,822)

    6.19     12/10/15         74         58,829   

Term Loan

    6.94     12/10/15         3,420         2,975,218   

TransFirst Holdings, Inc.,

         

First Lien Term Loan B-1

    4.75     12/27/17         1,971         1,977,510   

Second Lien Term Loan

    11.00     06/27/18         2,358         2,406,852   
         35,499,928   
Food & Drug Retailers–1.05%   

Rite Aid Corp.,

         

Second Lien Term Loan

    5.75     08/21/20         1,716         1,765,631   

Term Loan 6

    4.00     02/21/20         623         625,403   

Roundy’s Supermarkets, Inc., Term Loan B

    5.75     02/13/19         2,632         2,592,997   

Sprouts Farmers Markets Holdings, LLC, Term Loan

    4.00     04/23/20         1,163         1,167,966   

SuperValu Inc., Term Loan

    5.00     03/21/19         3,611         3,629,021   
         9,781,018   
Food Products–3.89%   

AdvancePierre Foods, Inc.,

         

First Lien Term Loan

    5.75     07/10/17         6,843         6,921,857   

Second Lien Term Loan

    9.50     10/10/17         728         742,466   

Candy Intermediate Holdings, Inc., Term Loan

    7.50     06/18/18         3,031         2,913,204   

CSM Bakery Supplies LLC, Term Loan

    4.75     07/03/20         4,514         4,485,631   

Del Monte Corp., Term Loan

    4.00     03/08/18         2,393         2,397,687   

Dole Food Co., Inc., Term Loan B

    3.75     04/01/20         1,746         1,746,559   

H.J. Heinz Co., Revolver Loan

    0.50     06/07/18         7,110         7,095,165   

JBS USA, LLC, Term Loan

    3.75     05/25/18         3,305         3,315,764   

New HB Acquisition, LLC, Term Loan B

    6.75     04/09/20         997         1,024,073   

Pinnacle Foods Finance LLC, Term Loan G

    3.25     04/29/20         5,768         5,725,573   
         36,367,979   
Food Service–3.47%          

Aramark Corp., Term Loan D

    4.00     09/09/19         3,568         3,588,024   

Focus Brands Inc., First Lien Term Loan

    4.27     02/21/18         2,129         2,138,609   

Landry’s, Inc., Term Loan B

    4.75     04/24/18         208         209,775   

Restaurant Holding Co., LLC, Term Loan

    9.00     02/17/17         2,121         2,134,452   

Seminole Hard Rock Entertainment, Inc., Term Loan

    3.50     05/14/20         1,031         1,031,909   

US Foods, Inc., Incremental Term Loan

    4.50     03/29/19         6,402         6,420,201   

Weight Watchers International, Inc., Term Loan B-2

    3.75     04/02/20         16,138         15,918,261   

Wendy’s International, Inc., Term Loan B

    3.25     05/15/19         983         982,845   
         32,424,076   
Forest Products–0.12%          

Xerium Technologies, Inc., Term Loan

    6.25     05/17/19         1,080         1,087,152   
Healthcare–9.75%          

Alere Inc.,

  

     

Incremental Term Loan B-1

    4.25     06/30/17         428         431,973   

Incremental Term Loan B-2

    4.25     06/30/17         2,451         2,472,211   

Term Loan B

    4.25     06/30/17         1,427         1,438,952   

Apria Healthcare Group Inc., Term Loan

    6.75     04/05/20         9,770         9,861,656   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

9                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  
Healthcare–(continued)   

ATI Holdings, Inc., Term Loan

    5.75     12/20/19       $ 1,208       $ 1,221,883   

Biomet, Inc., Term Loan B-1

    3.96     07/25/17         3,759         3,775,939   

Carestream Health, Inc., First Lien Term Loan

    5.00     06/07/19         7,020         7,090,468   

Community Health Systems, Inc., Term Loan

    3.76     01/25/17         359         360,973   

DaVita Inc., Term Loan B

    4.50     10/20/16         747         754,003   

DJO Finance LLC, Term Loan B

    4.75     09/15/17         7,260         7,322,352   

Drumm Investors LLC, Term Loan

    5.00     05/04/18         4,402         4,216,231   

Genoa Healthcare Group, LLC,

  

     

First Lien Term Loan

    7.25     08/08/14         228         219,273   

PIK Second Lien Term Loan(f)

    12.50     02/10/15         1,629         1,380,413   

HCA, Inc.,

  

     

Term Loan B-4

    2.93     05/01/18         7,311         7,317,338   

Term Loan B-5

    3.03     03/31/17         2,174         2,177,306   

Health Management Associates, Inc., Term Loan B

    3.50     11/16/18         1,793         1,799,073   

Kindred Healthcare, Inc., Term Loan B-1

    4.25     06/01/18         5,882         5,876,706   

Kinetic Concepts, Inc., Term Loan D-1

    4.50     05/04/18         16,245         16,306,107   

Surgical Care Affiliates, LLC,

  

     

Revolver Loan B(c)

    0.00     06/30/16         3,000         2,820,000   

Term Loan B

    4.28     12/29/17         6,032         6,047,263   

TriZetto Group, Inc.,

  

     

Second Lien Term Loan

    8.50     03/28/19         2,732         2,500,114   

Term Loan

    4.75     05/02/18         3,944         3,706,989   

Western Dental Services, Inc., Term Loan

    8.25     11/01/18         1,927         1,945,295   
         91,042,518   
Home Furnishings–0.23%          

Serta Simmons Holdings, LLC, Term Loan

    5.00     10/01/19         1,490         1,498,236   

Yankee Candle Co., Inc. (The), Term Loan

    5.25     04/02/19         684         691,391   
         2,189,627   
Industrial Equipment–2.91%          

Alliance Laundry Systems LLC, Second Lien Term Loan

    9.50     12/10/19         679         686,297   

Apex Tool Group, LLC, Term Loan

    4.50     01/31/20         2,012         2,022,734   

Doncasters US Finance LLC, Term Loan B

    5.50     04/09/20         3,188         3,222,041   

Gardner Denver, Inc., Term Loan

    4.25     07/30/20         2,889         2,879,639   

Generac Power System, Inc., Term Loan B

    3.50     05/29/20         2,280         2,273,823   

Grede LLC, Term Loan B

    4.50     05/02/18         4,255         4,270,462   

MEI, Inc., Term Loan

    5.00     08/21/20         1,908         1,912,893   

Milacron LLC, Term Loan

    4.25     03/30/20         1,640         1,644,919   

QS0001 Corp., First Lien Term Loan

    5.00     11/09/18         1,801         1,823,677   

Tank Holding Corp., Term Loan

    4.25     07/09/19         2,431         2,424,536   

Unifrax Holding Co., Term Loan

    4.25     11/28/18         150         151,167   

Wesco Distribution, Inc., Term Loan B-1

    4.50     12/12/19         3,824         3,854,832   
         27,167,020   
Insurance–0.47%          

Compass Investors Inc., Term Loan

    5.00     12/27/19         1,191         1,197,816   

Cooper Gay Swett & Crawford Ltd.,

  

     

First Lien Term Loan

    5.00     04/16/20         1,906         1,919,795   

Second Lien Term Loan

    8.25     10/16/20         1,270         1,291,773   
         4,409,384   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

10                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  
Leisure Goods, Activities & Movies–4.85%          

24 Hour Fitness Worldwide, Inc., Term Loan B

    5.25     04/22/16       $ 6,321       $ 6,386,934   

Alpha Topco Ltd. (United Kingdom), Term Loan B

    4.50     04/30/19         15,457         15,592,710   

AMC Entertainment Inc., Term Loan

    3.50     04/30/20         1,079         1,081,006   

Bright Horizons Family Solutions, Inc., Term Loan B

    4.00     01/30/20         1,115         1,118,431   

Equinox Holdings Inc., First Lien Term Loan

    4.50     01/31/20         1,072         1,078,481   

Fender Musical Instruments Corp., Term Loan

    5.75     04/03/19         577         580,302   

Great Wolf Resorts, Inc., Term Loan B

    4.50     08/06/20         1,874         1,875,901   

IMG Worldwide, Inc., Term Loan B

    4.50     06/16/16         1,126         1,126,970   

Kasima, LLC, Term Loan

    3.25     05/17/21         3,189         3,190,615   

Live Nation Entertainment, Inc., Term Loan B-1

    3.50     08/16/20         4,399         4,418,332   

Otter Products, LLC, Term Loan

    5.25     04/29/19         1,063         1,068,172   

Sabre Inc.,

  

     

Term Loan B

    5.25     02/19/19         456         461,030   

Term Loan C

    4.00     02/19/18         1,547         1,556,386   

SRAM, LLC, First Lien Term Loan

    4.02     04/10/20         586         582,797   

US FinCo LLC, Term Loan B

    4.00     05/29/20         850         850,299   

WMG Acquisition Corp., Term Loan B

    3.75     07/01/20         586         586,243   

Zuffa, LLC, Term Loan

    4.50     02/25/20         3,743         3,756,924   
         45,311,533   
Lodging & Casinos–4.43%          

Bally Technologies, Inc., Term Loan B(d)

           08/31/20         7,053         7,055,465   

Boyd Acquisition Sub, LLC, Term Loan B

    4.25     11/20/17         232         233,221   

Cannery Casino Resorts, LLC,

  

     

First Lien Term Loan

    6.00     10/02/18         3,770         3,773,775   

Second Lien Term Loan

    10.00     10/02/19         715         671,492   

Centaur Acquisition, LLC, First Lien Term Loan

    5.25     02/20/19         2,409         2,432,045   

Four Seasons Holdings Inc. (Canada),

  

     

First Lien Term Loan

    4.25     06/27/20         720         726,888   

Second Lien Term Loan

    6.25     12/28/20         1,310         1,336,243   

Golden Nugget, Inc.,

  

     

PIK First Lien Term Loan(f)

    3.19     06/30/14         959         949,437   

PIK First Lien Term Loan B(f)

    3.19     06/30/14         1,648         1,631,320   

Harrah’s Operating Co., Inc.,

  

     

Term Loan B4

    9.50     10/31/16         483         481,697   

Term Loan B-5

    4.43     01/26/18         7,130         6,303,448   

Term Loan B-6

    5.43     01/26/18         5,930         5,346,606   

Pinnacle Entertainment, Inc.,

  

     

Term Loan B-1

    3.75     08/15/16         1,781         1,789,666   

Term Loan B-2

    3.75     08/13/20         1,042         1,048,027   

Tropicana Entertainment Inc., Term Loan

    7.50     03/16/18         2,440         2,470,818   

Twin River Management Group, Inc., Term Loan

    5.25     11/09/18         3,399         3,437,505   

Yonkers Racing Corp.,

  

     

First Lien Term Loan

    4.25     08/20/19         1,396         1,390,852   

Second Lien Term Loan

    8.75     08/20/20         263         262,083   
         41,340,588   
Nonferrous Metals & Minerals–1.57%          

Alpha Natural Resources, Inc., Term Loan B

    3.50     05/22/20         3,181         3,056,812   

Arch Coal, Inc., Term Loan

    5.75     05/16/18         5,817         5,661,628   

Noranda Aluminum Acquisition Corp., Term Loan B

    5.75     02/28/19         4,508         4,293,887   

Walter Energy, Inc., Term Loan B

    6.75     04/02/18         1,750         1,674,531   
         14,686,858   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

11                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  
Oil & Gas–6.80%          

Atlas Energy, L.P., Term Loan

    6.50     07/30/19       $ 1,350       $ 1,367,546   

Bronco Midstream Funding, LLC, Term Loan

    5.00     08/17/20         3,519         3,519,276   

Buffalo Gulf Coast Terminals LLC, Term Loan

    5.25     10/31/17         6,925         6,994,157   

Chesapeake Energy Corp., Term Loan

    5.75     12/01/17         6,065         6,200,112   

CITGO Petroleum Corp., Term Loan B

    8.00     06/24/15         1,078         1,089,726   

Crestwood Holdings LLC, Term Loan B-1

    7.00     06/19/19         749         761,918   

Drillships Financing Holding Inc., Term Loan B-1

    6.00     03/31/21         8,053         8,102,845   

EMG Utica, LLC, Term Loan

    4.75     03/27/20         1,458         1,463,815   

Exco Resources, Inc., Term Loan

    5.00     08/19/19         3,782         3,758,165   

Glenn Pool Oil & Gas Trust I, Term Loan (Acquired 06/08/11; Cost $977,057)

    4.50     05/02/16         977         981,942   

HGIM Corp., Term Loan B

    5.50     06/18/20         2,557         2,573,029   

Kinder Morgan, Inc., Term Loan A

    4.18     05/24/15         2,488         2,511,397   

NGPL PipeCo LLC, Term Loan

    6.75     09/15/17         5,084         4,817,408   

Obsidian Natural Gas Trust (United Kingdom), Term Loan (Acquired 12/09/10-05/05/11;
Cost $1,662,409)

    7.00     11/02/15         1,629         1,637,236   

Pacific Drilling S.A. (Luxembourg), Term Loan

    4.50     06/04/18         1,243         1,251,235   

Samson Investment Co., Second Lien Term Loan

    6.00     09/25/18         4,181         4,212,385   

Saxon Enterprises LLC, Term Loan

    5.50     02/15/19         3,089         3,099,695   

Tallgrass Operations, LLC, Term Loan

    5.25     11/13/18         2,372         2,405,452   

Tervita Corp. (Canada), Term Loan

    6.25     05/15/18         3,267         3,243,943   

WildHorse Resources, LLC, Term Loan

    7.50     12/13/18         3,523         3,505,106   
         63,496,388   
Publishing–5.38%          

Affiliated Media, Inc., Term Loan

    8.50     03/19/14         419         418,507   

Cenveo Corp., Term Loan B

    6.25     02/13/17         5,617         5,666,344   

Cygnus Business Media, Inc., PIK Term Loan(e)(f)

    9.75     06/30/14         2,962         1,666,099   

Endurance Business Media, Inc., Term Loan (Acquired 12/14/10; Cost $4,467,403)(e)

    6.50     12/15/14         3,401         1,530,444   

Gatehouse Media, Inc., Revolver Loan(c)

    0.00     02/28/14         1,000         850,000   

Getty Images, Inc.,

  

     

Revolver Loan(d)

           10/18/17         1,295         1,209,837   

Term Loan

    4.75     10/18/19         6,475         6,251,402   

Harland Clarke Holdings Corp., Term Loan B-2

    5.43     06/30/17         458         452,193   

Knowledgepoint360 Group, LLC,

  

     

First Lien Term Loan

    3.53     04/14/14         448         392,018   

Second Lien Term Loan

    7.26     04/13/15         1,000         870,000   

Media General, Inc., Term Loan B(c)

    0.00     07/31/20         3,567         3,580,228   

MediMedia USA, Inc., First Lien Term Loan

    8.00     11/20/18         3,859         3,820,645   

Merrill Communications LLC, Term Loan

    7.31     03/08/18         6,032         6,099,505   

MTL Publishing LLC, Term Loan B-1

    4.25     06/29/18         3,280         3,300,343   

Multi Packaging Solutions, Inc., Term Loan

    4.25     08/21/20         1,531         1,531,389   

Newsday, LLC, Term Loan

    3.68     10/12/16         2,432         2,435,138   

ProQuest LLC, Term Loan

    6.00     04/13/18         2,676         2,697,895   

Southern Graphics Inc., Term Loan

    5.00     10/17/19         3,368         3,384,498   

Tribune Co., Term Loan B

    4.00     12/31/19         3,796         3,814,388   

YB (USA) LLC, Term Loan A3(g)

    0.00     04/30/14         1,403         304,207   
         50,275,080   
Radio & Television–4.86%          

Barrington Broadcasting LLC, Term Loan 2

    7.50     06/14/17         848         848,173   

Clear Channel Communications, Inc.,

  

     

Term Loan B

    3.83     01/29/16         6,706         6,275,113   

Term Loan D

    6.93     01/30/19         20,133         18,531,694   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

12                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  
Radio & Television–(continued)          

FoxCo Acquisition Sub, LLC, Term Loan

    5.50     07/14/17       $ 3,118       $ 3,138,007   

Gray Television, Inc., Term Loan

    4.75     10/15/19         2,393         2,416,269   

Mission Broadcasting, Inc., Term Loan B

    4.25     12/03/19         191         193,239   

Multicultural Radio Broadcasting, Inc., Term Loan (Acquired 12/04/12; Cost $711,528)

    7.00     06/05/17         744         746,335   

NEP/NCP HoldCo, Inc., Second Lien Term Loan

    9.50     07/22/20         168         172,164   

Nexstar Broadcasting, Inc., Term Loan B

    4.25     12/03/19         452         457,084   

Nine Entertainment Corp., Term Loan B

    3.50     02/05/20         2,110         2,101,446   

Raycom TV Broadcasting, LLC, Term Loan B

    4.25     05/31/17         2,608         2,627,611   

TWCC Holding Corp., Second Lien Term Loan

    7.00     06/26/20         1,687         1,737,156   

Univision Communications Inc.,

  

     

Incremental Term Loan

    4.00     03/02/20         1,894         1,881,211   

Term Loan

    4.50     03/02/20         4,312         4,309,409   
         45,434,911   
Retailers (except Food & Drug)–3.94%          

Academy, Ltd., Term Loan

    4.50     08/03/18         698         703,084   

Collective Brands, Inc., Term Loan

    7.25     10/09/19         3,409         3,474,548   

David’s Bridal, Inc.,

  

     

Term Loan(c)

    0.00     10/05/17         1,995         1,875,163   

Term Loan

    5.00     10/11/19         1,698         1,712,462   

Guitar Center, Inc., Term Loan

    6.28     04/10/17         5,230         5,158,122   

J. Crew Group, Inc., Term Loan B-1

    4.00     03/07/18         890         890,451   

National Vision, Inc., Term Loan

    7.00     08/02/18         2,392         2,409,691   

OSP Group, Inc., First Lien Term Loan

    5.50     02/05/20         2,733         2,746,296   

Pep Boys–Manny, Moe & Jack, Term Loan

    5.00     10/11/18         2,051         2,066,543   

Savers Inc., Term Loan

    5.00     07/09/19         5,394         5,437,744   

Spin Holdco Inc., First Lien Term Loan

    4.25     11/14/19         3,106         3,118,282   

Toys ‘R’ US-Delaware, Inc.,

  

     

Term Loan

    6.00     09/01/16         1,189         1,171,667   

Term Loan

    6.00     08/21/19         3,197         3,164,874   

Term Loan B-2

    5.25     05/25/18         123         119,053   

Term Loan B-3

    5.25     05/25/18         555         537,078   

Wilton Brands LLC, Term Loan B

    7.50     08/30/18         2,231         2,216,785   
         36,801,843   
Steel–0.96%          

Ameriforge Group Inc.,

  

     

First Lien Term Loan

    5.00     12/19/19         1,828         1,834,764   

Second Lien Term Loan

    8.75     12/18/20         544         551,755   

JFB Firth Rixson Inc., Term Loan

    4.25     06/30/17         930         931,900   

JMC Steel Group Inc., Term Loan

    4.75     04/03/17         1,509         1,511,243   

Tube City IMS Corp., Term Loan

    4.75     03/20/19         1,480         1,483,596   

Waupaca Foundry, Inc., Term Loan

    4.50     06/29/17         2,647         2,651,316   
         8,964,574   
Surface Transport–1.49%          

American Petroleum Tankers Parent LLC, Term Loan

    4.75     10/02/19         1,477         1,486,216   

JHCI Acquisition, Inc., First Lien Term Loan

    7.00     07/11/19         2,150         2,137,019   

Kenan Advantage Group, Inc., Term Loan

    3.75     06/10/16         1,838         1,853,509   

Navios Partners Finance (US) Inc., Term Loan

    5.25     06/27/18         3,390         3,457,707   

U.S. Shipping Corp., Term Loan

    9.00     04/30/18         4,910         5,020,012   
         13,954,463   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

13                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  
Telecommunications–8.69%          

Avaya Inc.,

         

Term Loan B-3

    4.76     10/26/17       $ 15,131       $ 13,518,274   

Term Loan B-5

    8.00     03/30/18         4,669         4,428,418   

Cellular South, Inc., Term Loan B

    3.25     05/22/20         2,120         2,121,748   

Consolidated Communications, Inc.,

         

Incremental Term Loan 3

    5.25     12/31/18         7,538         7,636,185   

Term Loan 2

    4.19     12/31/17         1,188         1,198,708   

Cricket Communications, Inc.,

         

Term Loan

    4.75     10/10/19         1,510         1,517,072   

Term Loan C

    4.75     03/09/20         2,818         2,833,463   

Crown Castle Operating Co., Term Loan B

    3.25     01/31/19         7,710         7,656,584   

Fairpoint Communications, Inc., Term Loan

    7.50     02/14/19         6,386         6,389,594   

Global Tel*Link Corp., First Lien Term Loan

    5.00     05/22/20         3,264         3,211,073   

Hargray Communications Group, Inc., Term Loan

    4.75     06/25/19         1,937         1,933,459   

Level 3 Communications, Inc.,

         

Term Loan B-II

    4.75     08/01/19         9,855         9,870,715   

Term Loan B-III

    4.00     08/01/19         4,217         4,221,548   

LTS Buyer LLC,

         

First Lien Term Loan B

    4.50     04/13/20         1,577         1,589,589   

Second Lien Term Loan

    8.00     04/12/21         127         127,827   

NTELOS Inc., Term Loan B

    5.75     11/08/19         6,044         6,036,299   

Syniverse Holdings, Inc., Term Loan

    4.00     04/23/19         1,055         1,062,046   

U.S. TelePacific Corp., Term Loan

    5.75     02/23/17         3,184         3,185,617   

Windstream Corp., Term Loan B-4

    3.50     01/23/20         2,638         2,644,446   
         81,182,665   
Utilities–3.29%          

Calpine Construction Finance Co., L.P. Term Loan B-2

    3.25     01/31/22         1,525         1,516,512   

Calpine Corp., Term Loan

    4.00     10/09/19         5,421         5,445,275   

EquiPower Resources Holdings, LLC,

         

First Lien Term Loan B

    4.25     12/21/18         516         515,632   

First Lien Term Loan C

    4.25     12/31/19         2,320         2,314,545   

LSP Madison Funding, LLC, Term Loan

    5.50     06/28/19         1,446         1,459,360   

NSG Holdings LLC, Term Loan

    4.75     12/11/19         771         778,633   

Sapphire Power Finance LLC, Term Loan B (Acquired 07/10/13; Cost $2,345,051)

    6.00     07/10/18         2,368         2,371,348   

Texas Competitive Electric Holdings,

         

Term Loan

    3.71     10/10/14         13,107         8,952,725   

Term Loan

    4.71     10/10/17         8,351         5,664,747   

USIC Holding, Inc., First Lien Term Loan

    4.75     07/10/20         1,687         1,694,145   
         30,712,922   

Total Variable Rate Senior Loan Interests

                              1,142,859,981   

Bonds and Notes–11.28%

         
Air Transport–0.80%          

Air Lease Corp.

    5.63     04/01/17         5,840         6,272,160   

Continental Airlines, Inc.(h)

    6.75     09/15/15         1,110         1,154,400   
         7,426,560   
Automotive–0.42%          

Gestamp Funding Luxembourg S.A. (Luxembourg)(h)

    5.63     05/31/20         1,491         1,446,270   

Goodyear Tire & Rubber Co.

    6.50     03/01/21         1,638         1,658,475   

Schaeffler AG (Germany)(h)

    4.75     05/15/21         889         843,213   
         3,947,958   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

14                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  
Business Equipment & Services–0.32%   

First Data Corp.(h)

    6.75     11/01/20       $ 2,932       $ 2,997,970   
Cable & Satellite Television–0.85%          

UPC Broadband Holdings, B.V. (Netherlands)(h)

    6.63     07/01/20         1,116         1,177,060   

UPC Broadband Holdings, B.V. (Netherlands)(h)

    7.25     11/15/21         5,862         6,330,960   

UPC Broadband Holdings, B.V. (Netherlands)(h)

    6.88     01/15/22         263         276,976   

Lynx II Corp.(h)

    5.38     04/15/21         200         196,500   
         7,981,496   
Chemicals & Plastics–1.08%   

Hexion Specialty Chemicals, Inc.(h)

    6.63     04/15/20         6,793         6,742,052   

Hexion Specialty Chemicals, Inc.

    6.63     04/15/20         2,165         2,148,763   

Ineos Holdings Ltd.(h)

    6.13     08/15/18         200         194,000   

Ineos Holdings Ltd.(h)

    8.38     02/15/19         367         403,700   

Ineos Holdings Ltd.(h)

    7.50     05/01/20         234         250,380   

Taminco Global Chemical Corp.(h)

    9.75     03/31/20         337         380,810   
         10,119,705   
Containers & Glass Products–1.71%   

Ardagh Glass Finance PLC (Ireland)(h)

    7.00     11/15/20         1,088         1,060,800   

Reynolds Group Holdings Inc.

    7.88     08/15/19         2,274         2,512,770   

Reynolds Group Holdings Inc.

    9.88     08/15/19         3,172         3,386,110   

Reynolds Group Holdings Inc.

    5.75     10/15/20         9,013         8,967,935   
         15,927,615   
Ecological Services & Equipment–0.09%   

Environmental Systems Products Holdings Inc.

    16.00     12/31/19         797         797,169   
Food Products–0.05%   

Chiquita Brands LLC(h)

    7.88     02/01/21         487         512,568   
Forest Products–0.32%   

Verso Paper Holdings LLC

    11.75     01/15/19         2,868         2,946,870   
Healthcare–1.22%   

Accellent Inc.

    8.38     02/01/17         3,441         3,570,037   

Accellent Inc.

    10.00     11/01/17         1,208         1,120,420   

Biomet, Inc.

    6.50     08/01/20         704         725,120   

Community Health Systems, Inc.

    5.13     08/15/18         980         1,006,950   

DJO Finance LLC

    8.75     03/15/18         2,058         2,238,075   

Kindred Healthcare, Inc.

    8.25     06/01/19         808         852,440   

Kinetic Concepts, Inc.

    10.50     11/01/18         1,728         1,907,280   
         11,420,322   
Lodging & Casinos–0.12%   

Harrah’s Operating Co., Inc.

    8.50     02/15/20         357         337,365   

Harrah’s Operating Co., Inc.

    9.00     02/15/20         785         757,525   
         1,094,890   
Nonferrous Metals & Minerals–0.15%   

TiZir Ltd. (United Kingdom)

    9.00     09/28/17         1,400         1,440,250   
Oil & Gas–0.61%   

NGPL PipeCo LLC(h)

    9.63     06/01/19         704         727,293   

Pacific Drilling S.A. (Luxembourg)(h)

    5.38     06/01/20         2,587         2,498,884   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

15                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  
Oil & Gas–(continued)          

Tervita Corp. (Canada)(h)

    8.00     11/15/18       $ 2,263       $ 2,268,658   

Western Refining, Inc.

    6.25     04/01/21         201         198,990   
         5,693,825   
Publishing–0.31%   

Merrill Communications, LLC(h)

    10.00     03/08/23         3,016         2,880,042   
Radio & Television–0.76%   

Univision Communications Inc.(h)

    6.75     09/15/22         6,796         7,101,820   
Retailers (except Food & Drug)–0.28%   

Claire’s Stores Inc.(h)

    9.00     03/15/19         1,627         1,805,970   

Targus Group International, Inc. (Acquired 12/16/09-12/14/11; Cost 2,327,543)(h)

    10.00     06/14/19         821         821,026   
         2,626,996   
Telecommunications–1.09%   

Goodman Networks Inc.(h)

    13.13     07/01/18         441         471,870   

Goodman Networks Inc.(h)

    13.13     07/01/18         4,200         4,473,000   

Wind Telecomunicazioni S.p.A. (Italy)(h)

    6.50     04/30/20         219         220,095   

Wind Telecomunicazioni S.p.A. (Italy)(h)

    7.25     02/15/18         2,393         2,464,790   

Windstream Corp.

    7.50     06/01/22         2,565         2,552,175   

Windstream Corp.

    6.38     08/01/23         22         20,020   
         10,201,950   
Utilities–1.10%   

Calpine Corp.(h)

    7.88     01/15/23         1         541   

Calpine Corp.(h)

    7.50     02/15/21         6,236         6,625,749   

NRG Energy Inc.

    7.63     05/15/19         2,303         2,458,452   

NRG Energy Inc.

    6.63     03/15/23         1,191         1,188,022   
         10,272,764   

Total Bonds and Notes

                              105,390,770   

Structured Products–6.26%

  

Apidos Cinco CDO (Cayman Islands)(i)

    4.51     05/14/20         772         716,856   

Apidos CLO II (Cayman Islands)(h)(i)

    5.01     12/21/18         843         808,660   

Apidos CLO IX (Cayman Islands)(h)(i)

    6.77     07/15/23         2,154         2,142,237   

Apidos CLO X (Cayman Islands)(h)(i)

    6.52     10/30/22         2,846         2,782,165   

Apidos CLO XI(h)(i)

    5.52     01/17/23         3,968         3,714,972   

Apidos Quattro CDO (Cayman Islands)(h)(i)

    3.87     01/20/19         1,040         949,582   

Ares XI CLO, Ltd.(h)(i)

    3.27     10/11/21         1,851         1,758,458   

Atrium IV CDO Corp.(h)

    9.18     06/08/19         268         271,974   

Atrium X CDO(h)(i)

    4.78     07/16/25         3,196         2,846,980   

Babson CLO Ltd. 2007-I(h)(i)

    3.52     01/18/21         773         690,773   

Columbus Nova CLO Ltd.(h)(i)

    3.86     05/16/19         1,431         1,277,222   

Columbus Nova CLO Ltd.(i)

    3.86     05/16/19         894         797,929   

Flagship CLO VI(h)(i)

    5.02     06/10/21         755         709,795   

Flagship CLO VI(i)

    5.02     06/10/21         2,565         2,409,875   

Four Corners CLO II, Ltd.(i)

    2.11     01/26/20         108         100,536   

Four Corners CLO II, Ltd.(h)(i)

    2.11     01/26/20         324         301,609   

Gramercy Park CLO(h)(i)

    5.77     07/17/23         4,004         3,821,652   

Halcyon Loan Investors CLO II, Ltd. (Cayman Islands)(h)(i)

    3.86     04/24/21         1,009         900,309   

ING Investment Management CLO I, Ltd.(h)(i)

    5.31     04/15/24         2,200         2,055,216   

ING Investment Management CLO III, Ltd.(h)(i)

    3.77     12/13/20         3,038         2,732,949   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

16                         Invesco Senior Income Trust


    

Interest

Rate

   

Maturity

Date

    

Principal

Amount

(000)

     Value  

ING Investment Management CLO III, Ltd.(h)(i)

    6.12     10/15/22       $ 1,026       $ 1,008,461   

ING Investment Management CLO IV, Ltd. (Cayman Islands)(h)(i)

    4.51     06/14/22         437         401,235   

ING Investment Management CLO IV, Ltd.(h)(i)

    6.02     10/15/23         3,875         3,786,490   

KKR Financial CLO 2012-1(h)(i)

    5.77     12/15/24         4,025         3,793,993   

KKR Financial CLO 2013-1(h)(i)

    5.05     07/15/25         2,115         1,905,397   

Madison Park Funding I Ltd.(h)(i)

    3.87     03/22/21         3,176         2,938,153   

Pacifica CDO VI, Ltd.(h)(i)

    4.01     08/15/21         1,247         1,108,637   

Sierra CLO II Ltd.(i)

    3.77     01/22/21         1,829         1,570,211   

Silverado CLO 2006-II Ltd.(h)(i)

    4.02     10/16/20         2,210         1,982,041   

Slater Mill Loan Fund, L.P.(h)(i)

    5.76     08/17/22         2,085         1,990,929   

Symphony CLO IX, Ltd.(h)(i)

    5.27     04/16/22         4,258         3,956,566   

Symphony CLO VIII, Ltd.(h)(i)

    6.02     01/09/23         2,317         2,243,711   

Total Structured Products

                              58,475,573   
                 Shares         

Common Stocks & Other Equity Interests–1.97%

         
Building & Development–0.93%          

Axia Acquisition Corp. (Acquired 05/30/08; Cost $2,673,763)(e)(h)(j)

         595         1,589,905   

Building Materials Holding Corp.(h)(j)

         923,526         5,079,393   

Lake at Las Vegas Joint Venture, LLC, Class A, (Acquired 07/15/10; Cost $7,937,680)(h)(j)

         780         0   

Lake at Las Vegas Joint Venture, LLC, Class B, (Acquired 07/15/10; Cost $93,970)(h)(j)

         9         0   

Lake at Las Vegas Joint Venture, LLC, Class C, Wts. expiring 07/15/15 (Acquired 07/15/10;
Cost $0)(h)(j)

         39         0   

Lake at Las Vegas Joint Venture, LLC, Class D, Wts. expiring 07/15/15 (Acquired 07/15/10;
Cost $0)(h)(j)

         54         0   

Lake at Las Vegas Joint Venture, LLC, Class E, Wts. expiring 07/15/15 (Acquired 07/15/10;
Cost $0)(h)(j)

         60         0   

Lake at Las Vegas Joint Venture, LLC, Class F, Wts. expiring 07/15/15 (Acquired 07/15/10;
Cost $0)(h)(j)

         67         0   

Lake at Las Vegas Joint Venture, LLC, Class G, Wts. expiring 07/15/15 (Acquired 07/15/10;
Cost $0)(h)(j)

         76         0   

Newhall Holding Co., LLC Class A(h)(j)

         346,693         962,073   

WCI Communities, Inc.(j)

                     69,585         1,054,216   
                                8,685,587   
Business Equipment & Services–0.00%          

Comdisco Holding Co., Inc.(j)

                     7         33   
Chemicals & Plastics–0.03%          

Metokote Corp., Wts. expiring 11/22/23 (Acquired 12/05/11; Cost $0)(h)(j)

                     180         312,751   
Conglomerates–0.09%          

Euramax International, Inc.(h)(j)

                     4,207         841,420   
Cosmetics & Toiletries–0.13%          

Marietta Intermediate Holding Corp. (Acquired 09/25/06; Cost $2,287,974)(h)(j)

         2,023,400         1,173,572   

Marietta Intermediate Holding Corp. Wts. expiring 02/20/19 (Acquired 12/22/04; Cost $0)(h)(j)

                     247,917         0   
                                1,173,572   
Ecological Services & Equipment–0.02%          

Environmental Systems Products Holdings, Inc. (Acquired 09/12/07; Cost $0)(h)(j)

                     9,333         169,301   
Financial Intermediaries–0.00%          

RJO Holdings Corp.(h)(j)

         1,482         14,816   

RJO Holdings Corp. Class A(h)(j)

         1,142         571   

RJO Holdings Corp. Class B(h)(j)

                     1,667         833   
         16,220   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

17                         Invesco Senior Income Trust


                 Shares      Value  
Home Furnishings–0.00%           

Generation Brands LLC (Acquired 01/29/10; Cost $0)(h)

              4,863       $ 0   
Leisure Goods, Activities & Movies–0.04%           

MB2 L.P. (Canada)(j)

              27,683         404,745   
Lodging & Casinos–0.41%           

Twin River Worldwide Holdings, Inc., Class A(h)(j)

          134,134         3,185,682   

Twin River Worldwide Holdings, Inc., Class B(h)(j)

              1,250         625,000   
         3,810,682   
Oil & Gas–0.00%           

Vitruvian Exploration LLC(h)(k)

              40,110         14,039   
Publishing–0.28%           

Affiliated Media, Inc.(h)(j)

          46,746         736,243   

Cygnus Business Media, Inc. (Acquired 07/19/04; Cost $1,251,821)(e)(h)(j)

          5,882         0   

Endurance Business Media, Inc. Class A (Acquired 12/14/10; Cost $6,292,167)(e)(h)(j)

          8,863         0   

F&W Publications, Inc. Wts. Expiring 06/09/14(h)(j)

          15,519         1,940   

F&W Publications, Inc.(h)(j)

          2,582         323   

MC Communications, LLC (Acquired 07/02/09; Cost $0)(h)(j)

          333,084         0   

Merrill Communications LLC Class A(h)(j)

          399,283         898,387   

Tribune Co. Class A(l)

              16,474         981,850   
         2,618,743   
Retailers (except Food & Drug)–0.04%           

Targus Group International, Inc. (Acquired 12/16/09; Cost $0)(h)(j)

              27,462         353,711   
Telecommunications–0.00%           

CTM Media Holdings Inc. Class B(k)

              127         7,874   

Total Common Stocks & Other Equity Interests

                       18,408,678   

Preferred Stocks–0.05%

          
Ecological Services & Equipment–0.04%           

Environmental Systems Products Holdings, Inc. (Acquired 09/12/07; Cost $53,400)(h)(j)

              2,136         394,071   
Financial Intermediaries–0.00%           

RTS Investor Corp.(h)(j)

              324         25,631   
Utilities–0.01%           

Genie Energy Ltd.(k)

              7,632         60,980   

Total Preferred Stocks

                       480,682   

Money Market Funds–0.02%

          

Liquid Assets Portfolio–Institutional Class(m)

          112,483         112,483   

Premier Portfolio–Institutional Class(m)

              112,484         112,484   

Total Money Market Funds

                       224,967   

TOTAL INVESTMENTS–141.93%(n) (Cost $1,347,576,054)

  

     1,325,840,651   

OTHER ASSETS LESS LIABILITIES–(2.86)%

  

     (26,707,585

BORROWINGS–(25.69)%

  

     (240,000,000

VARIABLE RATE TERM PREFERRED SHARES–(13.38)%

  

     (125,000,000

NET ASSETS APPLICABLE TO COMMON SHARES–100.00%

  

   $ 934,133,066   

Investment Abbreviations:

 

CDO  

– Collateralized Debt Obligation

LOC  

– Letter of Credit

PIK  

– Payment in Kind

Wts.  

– Warrants

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

18                         Invesco Senior Income Trust


Notes to Schedule of Investments:

 

(a)  Variable rate senior loan interests are, at present, not readily marketable, not registered under the Securities Act of 1933, as amended (the “1933 Act”), and may be subject to contractual and legal restrictions on sale. Senior secured corporate loans and senior secured debt securities in the Trust’s portfolio generally have variable rates which adjust to a base, such as the London Inter-Bank Offered Rate (“LIBOR”), on set dates, typically every 30 days but not greater than one year; and/or have interest rates that float at a margin above a widely recognized base lending rate such as the Prime Rate of a designated U.S. bank.
(b)  Variable rate senior loan interests often require prepayments from excess cash flow or permit the borrower to repay at its election. The degree to which borrowers repay, whether as a contractual requirement or at their election, cannot be predicted with accuracy. As a result, the actual remaining maturity may be substantially less than the stated maturities shown. However, it is anticipated that the senior secured floating rate interests will have an expected average life of three to five years.
(c)  All or a portion of this holding is subject to unfunded loan commitments. Interest rate will be determined at the time of funding. See Note 1L and Note 7.
(d)  This variable rate interest will settle after August 31, 2013, at which time the interest rate will be determined.
(e)  Affiliated company. As defined by the Investment Company Act of 1940, an affiliated company is one in which the Trust owns 5% or more of the outstanding voting securities or a company which is under common ownership or control. See Note 4.
(f)  All or a portion of this security is Payment-in-Kind.
(g)  Defaulted security. Currently, the issuer is in default with respect to principal and interest payments. The value of this security at August 31, 2013 represented less than 1% of the Trust’s Net Assets.
(h)  Security purchased or received in a transaction exempt from registration under the Securities Act of 1933, as amended (the “1933 Act”). The security may be resold pursuant to an exemption from registration under the 1933 Act, typically to qualified institutional buyers. The aggregate value of these securities at August 31, 2013 was $125,587,225, which represented 13.44% of the Trust’s Net Assets.
(i)  Interest or dividend rate is redetermined periodically. Rate shown is the rate in effect on August 31, 2013.
(j)  Non-income producing securities acquired through the restructuring of senior loans.
(k)  Securities acquired through the restructuring of senior loans.
(l)  Non-income producing security acquired as part of a bankruptcy restructuring.
(m)  The money market fund and the Trust are affiliated by having the same investment adviser.
(n)  Calculated as a percentage of net assets. Amounts in excess of 100% are due to the Trust’s use of leverage.

Portfolio Composition*

By credit quality, based on Total Investments

as of August 31, 2013

 

BBB

    1.3

BB

    31.3   

B

    53.4   

CCC

    5.8   

CC

    0.1   

Non-Rated

    6.7   

Equity

    1.4   

 

* Source: Standard & Poor’s LCD. A credit rating is an assessment provided by a nationally recognized statistical rating organization (NRSRO) of the creditworthiness of an issuer with respect to debt obligations, including specific securities, money market instruments or other debts. Ratings are measured on a scale that generally ranges from AAA (highest) to D (lowest); ratings are subject to change without notice. “Non-Rated” indicates the debtor was not rated, and should not be interpreted as indicating low quality. For more information on Standard & Poor’s rating methodology, please visit standarandpoors.com and select “Understanding Ratings” under Rating Resources on the homepage.

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

19                         Invesco Senior Income Trust


Statement of Assets and Liabilities

August 31, 2013

(Unaudited)

 

Assets:

  

Investments, at value (Cost $1,318,985,139)

  $ 1,315,880,724   

Investments in affiliates, at value (Cost $28,590,915)

    9,959,927   

Total investments, at value (Cost $1,347,576,054)

    1,325,840,651   

Cash

    8,135,358   

Receivable for:

 

Investments sold

    50,467,693   

Interest and fees

    9,144,023   

Investments matured

    2,469,299   

Deferred offering costs

    1,135,234   

Other assets

    838,083   

Total assets

    1,398,030,341   

Liabilities:

  

Variable rate term preferred shares, at liquidation preference ($0.01 par value, 1,250 issued with liquidation preference of $100,000 per share)

    125,000,000   

Payable for:

 

Borrowings

    240,000,000   

Investments purchased

    96,534,800   

Income distributions

    44,266   

Accrued trustees’ and officers’ fees and benefits

    15,158   

Accrued other operating expenses

    567,640   

Upfront commitment fees

    1,582,714   

Accrued interest expense

    152,697   

Total liabilities

    463,897,275   

Net assets applicable to common shares outstanding

  $ 934,133,066   

Net assets applicable to common shares consist of:

  

Shares of beneficial interest

  $ 1,579,184,174   

Undistributed net investment income

    (10,733,918

Undistributed net realized gain (loss)

    (586,778,616

Net unrealized appreciation (depreciation)

    (47,538,574
    $ 934,133,066   

Shares outstanding, no par value,
with an unlimited number of shares authorized:

   

Common shares outstanding

    179,999,900   

Net asset value per common share

  $ 5.19   

Market value per common share

  $ 5.22   
 

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

20                         Invesco Senior Income Trust


Statement of Operations

For the six months ended August 31, 2013

(Unaudited)

 

Investment income:

  

Interest

  $ 36,898,931   

Interest and dividends from affiliates

    409,507   

Dividends

    1,369   

Other income

    2,104,961   

Total investment income

    39,414,768   

Expenses:

 

Advisory fees

    5,586,807   

Administrative services fees

    1,314,543   

Custodian fees

    192,829   

Interest, facilities and maintenance fees

    2,623,395   

Transfer agent fees

    9,398   

Trustees’ and officers’ fees and benefits

    36,223   

Other

    573,325   

Total expenses

    10,336,520   

Less: Fees waived

    (6,775

Net expenses

    10,329,745   

Net investment income

    29,085,023   

Realized and unrealized gain:

 

Net realized gain from investment securities

    681,168   

Change in net unrealized appreciation of investment securities

    6,871,877   

Net realized and unrealized gain

    7,553,045   

Net increase in net assets from operations applicable to common shares

  $ 36,638,068   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

21                         Invesco Senior Income Trust


Statement of Changes in Net Assets

For the six months ended August 31, 2013 and the year ended February 28, 2013

(Unaudited)

 

     August 31,
2013
     February 28,
2013
 

Operations:

  

  

Net investment income

  $ 29,085,023       $ 61,792,589   

Net realized gain

    681,168         8,166,050   

Change in net unrealized appreciation

    6,871,877         43,515,164   

Net increase in net assets resulting from operations

    36,638,068         113,473,803   

Distributions to auction rate preferred shareholders from net investment income

            (2,614,633

Net increase in net assets from operations applicable to common shareholders

    36,638,068         110,859,170   

Distributions to common shareholders from net investment income

    (32,939,982      (60,119,967

Net increase in net assets applicable to common shares

    3,698,086         50,739,203   

Net assets applicable to common shares:

  

Beginning of period

    930,434,980         879,695,777   

End of period (includes undistributed net investment income of $(10,733,918) and $(6,878,959), respectively)

  $ 934,133,066       $ 930,434,980   

 

See accompanying Notes to Financial Statements which are an integral part of the financial statements.

 

22                         Invesco Senior Income Trust


Statement of Cash Flows

For the six months ended August 31, 2013

(Unaudited)

 

Cash provided by operating activities:

 

Net increase in net assets resulting from operations applicable to common shares

  $ 36,638,068   

Adjustments to reconcile net increase in net assets to net cash provided by (used in) operating activities:

  

Purchases of investments

    (822,936,217

Proceeds from sales of investments

    796,179,514   

Net change in upfront commitment fees

    (3,026

Amortization of loan fees

    (10,229,395

Decrease in interest receivables and other assets

    2,547,217   

Accretion of discount on investment securities

    (3,592,790

Decrease in accrued expenses and other payables

    (32,608

Net realized gain from investment securities

    (681,168

Net change in unrealized appreciation on investment securities

    (6,871,877

Net cash provided by (used in) operating activities

    (8,982,282

Cash provided by financing activities:

 

Dividends paid to common shareholders from net investment income

    (32,939,929

Net proceeds from and repayment of borrowings

    33,000,000   

Net cash provided by financing activities

    60,071   

Net increase (decrease) in cash and cash equivalents

    (8,922,211

Cash and cash equivalents at beginning of period

    17,282,536   

Cash and cash equivalents at end of period

  $ 8,360,325   

Supplemental disclosure of cash flow information:

 

Cash paid during the period for interest, facilities and maintenance fees

  $ 2,516,442   

Notes to Financial Statements

August 31, 2013

(Unaudited)

NOTE 1—Significant Accounting Policies

Invesco Senior Income Trust (the “Trust”) is a Delaware statutory trust registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as a diversified, closed-end management investment company.

The Trust’s investment objective is to provide a high level of current income, consistent with preservation of capital. The Trust seeks to achieve its objectives by investing primarily in a portfolio of interests in floating or variable senior loans to corporations, partnerships, and other entities which operate in a variety of industries and geographic regions. The Trust borrows money for investment purposes which may create the opportunity for enhanced return, but also should be considered a speculative technique and may increase the Trust’s volatility.

The following is a summary of the significant accounting policies followed by the Trust in the preparation of its financial statements.

A. Security Valuations — Variable rate senior loan interests are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may reflect appropriate factors such as ratings, tranche type, industry, company performance, spread, individual trading characteristics, institution-size trading in similar groups of securities and other market data.

Securities, including restricted securities, are valued according to the following policy. A security listed or traded on an exchange (except convertible bonds) is valued at its last sales price as of the close of the customary trading session on the exchange where the security is principally traded, or lacking any sales on a particular day, the security may be valued at the closing bid price on that day. Securities traded in the over-the-counter market (but not securities reported on the NASDAQ Stock Exchange) are valued based on the prices furnished by independent pricing services, in which case the securities may be considered fair valued, or by market makers. Each security reported on the NASDAQ Stock Exchange is valued at the NASDAQ Official Closing Price (“NOCP”) as of the close of the customary trading session on the valuation date or absent a NOCP, at the closing bid price.

Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and the ask prices from the exchange on which they are principally traded. Options not listed on an exchange are valued by an independent source at the mean between the last bid and ask prices. For purposes of determining net asset value per share, futures and option contracts generally are valued 15 minutes after the close of the customary trading session of the New York Stock Exchange (“NYSE”).

Investments in open-end and closed-end registered investment companies that do not trade on an exchange are valued at the end of day net asset value per share. Investments in open-end and closed-end registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the customary trading session on the exchange where the security is principally traded.

 

23                         Invesco Senior Income Trust


Debt obligations (including convertible bonds) and unlisted equities are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to specific securities, dividend rate (for unlisted equities), yield (for debt obligations), quality, type of issue, coupon rate (for debt obligations), maturity (for debt obligations), individual trading characteristics and other market data. Debt obligations are subject to interest rate and credit risks. In addition, all debt obligations involve some risk of default with respect to interest and/or principal payments.

Swap agreements are fair valued using an evaluated quote provided by an independent pricing service. Evaluated quotes provided by the pricing service are valued based on a model which may include end of day net present values, spreads, ratings, industry, and company performance.

Foreign securities’ (including foreign exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of the close of the NYSE. If market quotations are available and reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before the close of the NYSE, closing market quotations may become unreliable. If between the time trading ends on a particular security and the close of the customary trading session on the NYSE, events occur that the Adviser determines are significant and make the closing price unreliable, the Trust may fair value the security. If the event is likely to have affected the closing price of the security, the security will be valued at fair value in good faith using procedures approved by the Board of Trustees. Adjustments to closing prices to reflect fair value may also be based on a screening process of an independent pricing service to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of the close of the NYSE. Foreign securities’ prices meeting the approved degree of certainty that the price is not reflective of current value will be priced at the indication of fair value from the independent pricing service. Multiple factors may be considered by the independent pricing service in determining adjustments to reflect fair value and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures. Foreign securities may have additional risks including exchange rate changes, potential for sharply devalued currencies and high inflation, political and economic upheaval, the relative lack of issuer information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards.

Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by independent sources. The last bid price may be used to value equity securities. The mean between the last bid and asked prices is used to value debt obligations, including corporate loans.

Securities for which market quotations are not readily available or became unreliable are valued at fair value as determined in good faith by or under the supervision of the Trust’s officers following procedures approved by the Board of Trustees. Issuer specific events, market trends, bid/ask quotes of brokers and information providers and other market data may be reviewed in the course of making a good faith determination of a security’s fair value.

Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer’s assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.

B. Securities Transactions and Investment Income — Securities transactions are accounted for on a trade date basis. Realized gains or losses on sales are computed on the basis of specific identification of the securities sold. Interest income is recorded on the accrual basis from the settlement date. Facility fees received may be amortized over the life of the loan. Dividend income (net of withholding tax, if any) is recorded on the ex-dividend date. Bond premiums and discounts are amortized and/or accreted for financial reporting purposes.

The Trust may periodically participate in litigation related to Trust investments. As such, the Trust may receive proceeds from litigation settlements. Any proceeds received are included in the Statement of Operations as realized gain (loss) for investments no longer held and as unrealized gain (loss) for investments still held.

Other income is comprised primarily of amendment fees which are recorded when received. Amendment fees are received in return for changes in the terms of the loan or note.

Brokerage commissions and mark ups are considered transaction costs and are recorded as an increase to the cost basis of securities purchased and/or a reduction of proceeds on a sale of securities. Such transaction costs are included in the determination of net realized and unrealized gain (loss) from investment securities reported in the Statement of Operations and the Statement of Changes in Net Assets and the net realized and unrealized gains (losses) on securities per share in the Financial Highlights. Transaction costs are included in the calculation of the Trust’s net asset value and, accordingly, they reduce the Trust’s total returns. These transaction costs are not considered operating expenses and are not reflected in net investment income reported in the Statement of Operations and Statement of Changes in Net Assets, or the net investment income per share and ratios of expenses and net investment income reported in the Financial Highlights, nor are they limited by any expense limitation arrangements between the Trust and the investment adviser.

C. Country Determination — For the purposes of making investment selection decisions and presentation in the Schedule of Investments, the investment adviser may determine the country in which an issuer is located and/or credit risk exposure based on various factors. These factors include the laws of the country under which the issuer is organized, where the issuer maintains a principal office, the country in which the issuer derives 50% or more of its total revenues and the country that has the primary market for the issuer’s securities, as well as other criteria. Among the other criteria that may be evaluated for making this determination are the country in which the issuer maintains 50% or more of its assets, the type of security, financial guarantees and enhancements, the nature of the collateral and the sponsor organization. Country of issuer and/or credit risk exposure has been determined to be the United States of America, unless otherwise noted.
D. Distributions — The Trust declares and pays monthly dividends from net investment income to common shareholders. Distributions from net realized capital gain, if any, are generally declared and paid annually and are distributed on a pro rata basis to common and preferred shareholders.
E. Federal Income Taxes — The Trust intends to comply with the requirements of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”) necessary to qualify as a regulated investment company and to distribute substantially all of the Trust’s taxable earnings to shareholders. As such, the Trust will not be subject to federal income taxes on otherwise taxable income (including net realized capital gain) that is distributed to shareholders. Therefore, no provision for federal income taxes is recorded in the financial statements.

 

24                         Invesco Senior Income Trust


The Trust files tax returns in the U.S. Federal jurisdiction and certain other jurisdictions. Generally, the Trust is subject to examinations by such taxing authorities for up to three years after the filing of the return for the tax period.

F. Interest, Facilities and Maintenance Fees — Interest, Facilities and Maintenance Fees include interest and related borrowing costs such as commitment fees, rating and bank agent fees and other expenses associated with lines of credit and Variable Rate Term Preferred Shares (“VRTP Shares”), and interest and administrative expenses related to establishing and maintaining Auction Rate Preferred Shares (“ARPS”) and floating rate note obligations, if any.
G. Accounting Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“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 revenues and expenses during the reporting period including estimates and assumptions related to taxation. Actual results could differ from those estimates by a significant amount. In addition, the Trust monitors for material events or transactions that may occur or become known after the period-end date and before the date the financial statements are released to print.
H. Indemnifications — Under the Trust’s organizational documents, each Trustee, officer, employee or other agent of the Trust is indemnified against certain liabilities that may arise out of the performance of their duties to the Trust. Additionally, in the normal course of business, the Trust enters into contracts, including the Trust’s servicing agreements, that contain a variety of indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. The risk of material loss as a result of such indemnification claims is considered remote.
I. Bank Loan Risk Disclosures — Although the resale, or secondary market for floating rate loans has grown substantially over the past decade, both in overall size and number of market participants, there is no organized exchange or board of trade on which floating rate loans are traded. Instead, the secondary market for floating rate loans is a private, unregulated interdealer or interbank resale market. Such a market may therefore be subject to irregular trading activity, wide bid/ask spreads, and extended trade settlement periods. Similar to other asset classes, bank loan funds may be exposed to counterparty credit risk, or the risk than an entity with which the Trust has unsettled or open transactions may fail to or be unable to perform on its commitments. The Trust manages counterparty credit risk by entering into transactions only with counterparties that they believe have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties.
J. Industry Concentration — To the extent that the Trust is concentrated in securities of issuers in the banking and financial services industries, the Trust’s performance will depend to a greater extent on the overall condition of those industries. The value of these securities can be sensitive to changes in government regulation, interest rates and economic downturns in the U.S. and abroad.
K. Cash and Cash Equivalents — For the purposes of the Statement of Cash Flows the Trust defines Cash and Cash Equivalents as cash (including foreign currency), money market funds and other investments held in lieu of cash and excludes investments made with cash collateral received.
L. Securities Purchased on a When-Issued and Delayed Delivery Basis — The Trust may purchase and sell interests in portfolio securities on a when-issued and delayed delivery basis, with payment and delivery scheduled for a future date. No income accrues to the Trust on such interests or securities in connection with such transactions prior to the date the Trust actually takes delivery of such interests or securities. These transactions are subject to market fluctuations and are subject to the risk that the value at delivery may be more or less than the trade date purchase price. Although the Trust will generally purchase these securities with the intention of acquiring such securities, they may sell such securities prior to the settlement date.
M. Leverage Risk — The Trust may utilize leverage to seek to enhance the yield of the Trust by borrowing or issuing preferred shares. There are risks associated with borrowing or issuing preferred shares in an effort to increase the yield and distributions on the common shares, including that the costs of the financial leverage may exceed the income from investments made with such leverage, the higher volatility of the net asset value of the common shares, and that fluctuations in the interest rates on the borrowing or dividend rates on preferred shares may affect the yield and distributions to the common shareholders. There can be no assurance that the Trust’s leverage strategy will be successful.
N. Other Risks — The Trust may invest all or substantially all of its assets in senior secured floating rate loans, senior secured debt securities or other securities rated below investment grade. These securities are generally considered to have speculative characteristics and are subject to greater risk of loss of principal and interest than higher rated securities. The value of lower quality debt securities and floating rate loans can be more volatile due to increased sensitivity to adverse issuer, political, regulatory, market or economic developments.

The Trust invests in Corporate Loans from U.S. or non-U.S. companies (the “Borrowers”). The investment of the Trust in a Corporate Loan may take the form of participation interests or assignments. If the Trust purchases a participation interest from a syndicate of lenders (“Lenders”) or one of the participants in the syndicate (“Participant”), one or more of which administers the loan on behalf of all the Lenders (the “Agent Bank”), the Trust would be required to rely on the Lender that sold the participation interest not only for the enforcement of the Trust’s rights against the Borrower but also for the receipt and processing of payments due to the Trust under the Corporate Loans. As such, the Trust is subject to the credit risk of the Borrower and the Participant. Lenders and Participants interposed between the Trust and a Borrower, together with Agent Banks, are referred to as “Intermediate Participants”.

NOTE 2—Advisory Fees and Other Fees Paid to Affiliates

The Trust has entered into a master investment advisory agreement with Invesco Advisers, Inc. (the “Adviser” or “Invesco”). Under the terms of the investment advisory agreement, the Trust pays an annual fee of 0.85% based on the average daily managed assets of the Trust. Managed assets for this purpose means the Trust’s net assets, plus assets attributable to outstanding preferred shares and the amount of any borrowings incurred for the purpose of leverage (whether or not such borrowed amounts are reflected in the Trust’s financial statements for purposes of GAAP.)

Under the terms of a master sub-advisory agreement between the Adviser and each of Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management (Japan) Limited, Invesco Australia Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”) the Adviser, not the Trust, may pay 40% of the fees paid to the Adviser to any such Affiliated Sub-Adviser(s) that provide(s) discretionary investment management services to the Trust based on the percentage of assets allocated to such Sub-Adviser(s).

 

25                         Invesco Senior Income Trust


The Adviser has contractually agreed, through at least June 30, 2014, to waive the advisory fee payable by the Trust in an amount equal to 100% of the net advisory fees the Adviser receives from the affiliated money market funds on investments by the Trust of uninvested cash in such affiliated money market funds.

For the six months ended August 31, 2013, the Adviser waived advisory fees of $6,775.

The Trust has entered into a master administrative services agreement with Invesco pursuant to which the Trust has agreed to pay Invesco for certain administrative costs incurred in providing accounting services to the Trust. For the six months ended August 31, 2013, expenses incurred under this agreement are shown in the Statement of Operations as Administrative services fees. Also, Invesco has entered into service agreements whereby State Street Bank and Trust Company (“SSB”) serves as custodian and fund accountant and provides certain administrative services to the Trust.

Certain officers and trustees of the Trust are officers and directors of Invesco.

NOTE 3—Additional Valuation Information

GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under current market conditions. GAAP establishes a hierarchy that prioritizes the inputs to valuation methods, giving the highest priority to readily available unadjusted quoted prices in an active market for identical assets (Level 1) and the lowest priority to significant unobservable inputs (Level 3), generally when market prices are not readily available or are unreliable. Based on the valuation inputs, the securities or other investments are tiered into one of three levels. Changes in valuation methods may result in transfers in or out of an investment’s assigned level:

  Level 1 — Prices are determined using quoted prices in an active market for identical assets.
  Level 2 — Prices are determined using other significant observable inputs. Observable inputs are inputs that other market participants may use in pricing a security. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, yield curves, loss severities, default rates, discount rates, volatilities and others.
  Level 3 — Prices are determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs reflect the Trust’s own assumptions about the factors market participants would use in determining fair value of the securities or instruments and would be based on the best available information.

The following is a summary of the tiered valuation input levels, as of August 31, 2013. The level assigned to the securities valuations may not be an indication of the risk or liquidity associated with investing in those securities. Because of the inherent uncertainties of valuation, the values reflected in the financial statements may materially differ from the value received upon actual sale of those investments.

 

     Level 1      Level 2      Level 3      Total  

Variable Rate Senior Loan Interests

  $       $ 1,087,576,733       $ 55,283,248       $ 1,142,859,981   

Bonds & Notes

            104,569,744         821,026         105,390,770   

Structured Products

            58,475,573                 58,475,573   

Equity Securities

    8,279,708         6,841,308         3,993,311         19,114,327   

Total Investments

  $ 8,279,708       $ 1,257,463,358       $ 60,097,585       $ 1,325,840,651   

A reconciliation of Level 3 investments is presented when the Trust had a significant amount of Level 3 investments at the beginning and/or end of the reporting period in relation to net assets.

The following is a reconciliation of the fair valuations using significant unobservable inputs (Level 3) for the Variable Rate Senior Loan Interests during the six months ended August 31, 2013:

 

    

Beginning

Balance, as of

February 28,

2013

    Purchases     Sales    

Accrued

discounts/
premiums

   

Realized

Gain/(Loss)

   

Change in

Unrealized

Appreciation
(Depreciation)

   

Transfers

into

Level 3

   

Transfers

out of

Level 3

   

Ending

Balance, as of

August 31,

2013

 

Variable Rate Senior Loan Interests

  $ 84,334,209      $ 13,366,814      $ (21,879,959   $ 93,840      $ (4,647,921   $ 7,692,305      $ 9,467,220      $ (33,143,260   $ 55,283,248   

Bonds & Notes

    821,026                                                         821,026   

Equity Securities

    2,706,621                                    (290,618     1,577,308               3,993,311   

Total

  $ 87,861,856      $ 13,366,814      $ (21,879,959   $ 93,840      $ (4,647,921   $ 7,401,687      $ 11,044,528      $ (33,143,260   $ 60,097,585   

The Variable Rate Senior Loan Interests determined to be level 3 at the end of the reporting period were valued utilizing quotes from a third-party vendor pricing service. Investments in Variable Rate Senior Loan Interests were transferred from Level 2 to Level 3 due to third-party vendor quotations utilizing single market quotes and was assumed to have occurred at the end of the reporting period. A significant change in third-party pricing information could result in a significantly lower or higher value in Level 3 investments.

 

26                         Invesco Senior Income Trust


NOTE 4—Investments in Other Affiliates

The 1940 Act defines affiliates as those issuances in which a fund holds 5% or more of the outstanding voting securities. The Trust has not owned enough of the outstanding voting securities of the issuer to have control (as defined in the 1940 Act) of that issuer. The following is a summary of the investments in other affiliates for the six months ended August 31, 2013.

 

    

Value

02/28/13

    

Purchases

at Cost

    

Proceeds

from Sales

    

Change in

Unrealized

Appreciation

(Depreciation)

    

Realized

Gain (Loss)

    

Value

08/31/13

    

Interest

Income

 

Axia Inc. — Second Lien Term Loan A

  $ 988,516       $ 34,749       $       $ 125,962       $       $ 1,149,227       $ 42,976   

Axia Inc. — Second Lien Term Loan B

    1,639,729                         210,960                 1,850,689         49,011   

Axia Inc. — Revolver Loan

    1,824,876                         123,720                 1,948,596         10,539   

Axia Acquisition Corp. — Common Shares

    1,488,675                         101,230                 1,589,905           

Cygnus Business Media, Inc. — Common Shares

    0                                         0           

Cygnus Business Media, Inc. — Term Loan

    1,914,276                 (931,503      683,270         56         1,666,099         190,665   

Endurance Business Media, Inc. — Common Shares

    88,633                         (88,633              0           

Endurance Business Media, Inc. — Term Loan

    683,995                 (18,988      871,391         (5,954      1,530,444         113,239   

Total

  $ 8,628,700       $ 34,749       $ (950,491    $ 2,027,900       $ (5,898    $ 9,734,960       $ 406,430   

NOTE 5—Trustees’ and Officers’ Fees and Benefits

Trustees’ and Officers’ Fees and Benefits include amounts accrued by the Trust to pay remuneration to certain Trustees and Officers of the Trust.

During the six months ended August 31, 2013, the Trust paid legal fees of $99,915 for services rendered by Skadden, Arps, Slate, Meagher & Flom LLP as counsel to the Trust. A trustee of the Trust is Of Counsel of Skadden, Arps, Slate, Meagher & Flom LLP.

NOTE 6—Cash Balances and Borrowings

The Trust has entered into a $350 million revolving credit and security agreement which will expire on August 27, 2014. The revolving credit and security agreement is secured by the assets of the Trust.

During the six months ended August 31, 2013, the average daily balance of borrowings under the revolving credit and security agreement was $238,038,043 with a weighted interest rate of 0.18%. Expenses under the credit agreement are shown in the Statement of Operations as Interest, facilities and maintenance fees.

The Trust is permitted to temporarily carry a negative or overdrawn balance in its account with SSB, the custodian bank. Such balances, if any at period end, are shown in the Statement of Assets and Liabilities under the payable caption Amount due custodian. To compensate the custodian bank for such overdrafts, the overdrawn Trust may either (1) leave funds as a compensating balance in the account so the custodian bank can be compensated by earning the additional interest; or (2) compensate by paying the custodian bank at a rate agreed upon by the custodian bank and Invesco, not to exceed the contractually agreed upon rate.

NOTE 7—Unfunded Loan Commitments

Pursuant to the terms of certain Senior Loan agreements, the Trust held the following unfunded loan commitments as of August 31, 2013. The Trust intends to reserve against such contingent obligations by designating cash, liquid securities and liquid Senior Loans as a reserve.

 

Borrower    Type     

Principal

Amount

       Value  

Axia Inc.

   Revolver      $ 2,062,007         $ 1,948,596   

David’s Bridal, Inc.

   Term Loan        1,994,854           1,875,163   

Delta Air Lines, Inc.

   Revolver        7,315,565           6,949,787   

GateHouse Media, Inc.

   Revolver        1,000,000           850,000   

Lake at Las Vegas Joint Venture, LLC

   Revolver        16,242           6,578   

Media General, Inc.

   Term Loan        3,566,888           3,580,228   

Reynolds Group Holdings Inc.

   Revolver        5,534,362           5,528,329   

Surgical Care Affiliates, Inc.

   Revolver        3,000,000           2,820,000   

West Corp.

   Revolver        2,632,809           2,474,840   
            $ 27,122,727         $ 26,033,521   

NOTE 8—Tax Information

The amount and character of income and gains to be distributed are determined in accordance with income tax regulations, which may differ from GAAP. Reclassifications are made to the Trust’s capital accounts to reflect income and gains available for distribution (or available capital loss carryforward) under income tax regulations. The tax character of distributions paid during the year and the tax components of net assets will be reported at the Trust’s fiscal year-end.

 

27                         Invesco Senior Income Trust


Capital loss carryforward is calculated and reported as of a specific date. Results of transactions and other activity after that date may affect the amount of capital loss carryforward actually available for the Trust to utilize. The Regulated Investment Company Modernization Act of 2010 eliminated the eight-year carryover period for capital losses that arise in taxable years beginning after its enactment date of December 22, 2010. Consequently, these capital losses can be carried forward for an unlimited period. However, capital losses with an expiration period may not be used to offset capital gains until all net capital losses without an expiration date have been utilized. Additionally, post-enactment capital loss carryovers will retain their character as either short-term or long-term capital losses instead of as short-term capital losses as under prior law. The ability to utilize capital loss carryforward in the future may be limited under the Internal Revenue Code and related regulations based on the results of future transactions.

The Trust had a capital loss carryforward as of February 28, 2013 which expires as follows:

 

Capital Loss Carryforward*  
Expiration   Short-Term        Long-Term        Total  

February 28, 2014

  $ 6,730,384         $         $ 6,730,384   

February 28, 2015

    11,934,630                     11,934,630   

February 29, 2016

    17,612,397                     17,612,397   

February 28, 2017

    121,546,728                     121,546,728   

February 28, 2018

    316,566,788                     316,566,788   

February 28, 2019

    81,508,885                     81,508,885   

Not subject to expiration

              27,721,752           27,721,752   
    $ 555,899,812         $ 27,721,752         $ 583,621,564   

 

* Capital loss carryforward as of the date listed above is reduced for limitations, if any, to the extent required by the Internal Revenue Code.

NOTE 9—Investment Securities

The aggregate amount of investment securities (other than short-term securities, U.S. Treasury obligations and money market funds, if any) purchased and sold by the Trust during the six months ended August 31, 2013 was $830,039,567 and $814,429,455, respectively. Cost of investments on a tax basis includes the adjustments for financial reporting purposes as of the most recently completed federal income tax reporting period-end.

 

Unrealized Appreciation (Depreciation) of Investment Securities on a Tax Basis  

Aggregate unrealized appreciation of investment securities

  $ 37,643,917   

Aggregate unrealized (depreciation) of investment securities

    (72,589,080

Net unrealized appreciation (depreciation) of investment securities

  $ (34,945,163

Cost of investments for tax purposes is $1,360,785,814.

NOTE 10—Common Shares of Beneficial Interest

Transactions in common shares of beneficial interest were as follows:

 

    

August 31,

2013

      

February 28,

2013

 

Beginning shares

    179,999,900           179,999,900   

Shares issued through dividend reinvestment

                

Ending shares

    179,999,900           179,999,900   

The Trust may, when appropriate, purchase shares in the open market or in privately negotiated transactions at a price not above market value or net asset value, whichever is lower at the time of purchase.

NOTE 11—Variable Rate Term Preferred Shares

On October 26, 2012, the Trust issued in the aggregate 1,250 VRTP Shares of the following series: (i) 2015/11-VVR C-1 (the “C-1 Series”), (ii) 2015/11-VVR C-2 (the “C-2 Series”), (iii) 2015/11-VVR C-3 (the “C-3 Series”), (iv) 2015/11-VVR C-4 (the “C-4 Series”) and (v) 2015/11-VVR L-1 (the “L-1 Series”), each with a liquidation preference of $100,000 per share, pursuant to an offering exempt from registration under the 1933 Act. Proceeds from the issuance of VRTP Shares on October 26, 2012 were used to redeem all of the Trust’s outstanding ARPS. VRTP Shares are a floating-rate form of preferred shares with a mandatory redemption date. The Trust is required to redeem all outstanding VRTP Shares on September 1, 2016, unless earlier redeemed, repurchased or extended. VRTP Shares are subject to optional and mandatory redemption in certain circumstances. The redemption price per share is equal to the sum of the liquidation value per share plus any accumulated but unpaid dividends. On or prior to the redemption date, the Trust will be required to segregate assets having a value equal to 110% of the redemption amount.

The Trust incurred costs in connection with the issuance of the VRTP Shares. These costs were recorded as a deferred charge and are being amortized over the 3 year life of the VRTP Shares. Amortization of these costs is included in Interest, facilities and maintenance fees on the Statement of Operations and the unamortized balance is included in Deferred offering costs on the Statement of Assets and Liabilities.

 

28                         Invesco Senior Income Trust


Dividends paid on the VRTP Shares (which are treated as interest expense for financial reporting purposes) are declared daily and paid monthly. The rate for dividends was equal to the sum of an applicable base rate (defined below) plus a ratings spread of 1.20% to 5.20%, which is based on the long term rating assigned to the VRTP Shares by Moody’s and Fitch.

 

Series   Applicable Base Rate

C-1 Series

  Weighted average interest rate paid or payable by CHARTA, LLC to purchase shares of the C-1 Series

C-2 Series

  Weighted average interest rate paid or payable by CAFCO, LLC to purchase shares of the C-2 Series

C-3 Series

  Weighted average interest rate paid or payable by CIESCO, LLC to purchase shares of the C-3 Series

C-4 Series

  Weighted average interest rate paid or payable by CRC Funding, LLC to purchase shares of the C-4 Series

L-1 Series

  30 day London Interbank Offered Rate by Citibank in London, England

The average aggregate liquidation preference outstanding and the average annualized dividend rate of the VRTP Shares during the six months ended August 31, 2013 were $125,000,000 and 1.42%, respectively.

The Trust is subject to certain restrictions relating to the VRTP Shares, such as maintaining certain asset coverage and leverage ratio requirements. Failure to comply with these restrictions could preclude the Trust from declaring any distributions to common shareholders or purchasing common shares and/or could trigger the mandatory redemption of VRTP Shares at liquidation preference.

The liquidation preference of VRTP Shares, which are considered debt of the Trust for financial reporting purposes, is recorded as a liability under the caption Variable rate term preferred shares on the Statement of Assets and Liabilities. Unpaid dividends on VRTP Shares are recognized as Accrued interest expense on the Statement of Assets and Liabilities. Dividends paid on VRTP Shares are recognized as a component of Interest, facilities and maintenance fees on the Statement of Operations.

NOTE 12—Senior Loan Participation Commitments

The Trust invests in participations, assignments, or acts as a party to the primary lending syndicate of a Senior Loan interest to corporations, partnerships, and other entities. When the Trust purchases a participation of a Senior Loan interest, the Trust typically enters into a contractual agreement with the lender or other third party selling the participation, but not with the borrower directly. As such, the Trust assumes the credit risk of the borrower, selling participant or other persons interpositioned between the Trust and the borrower.

At the six months ended August 31, 2013, the following sets forth the selling participants with respect to interest in Senior Loans purchased by the Trust on a participation basis.

 

Selling Participant  

Principal Amount

(000’s omitted)

      

Value

(000’s omitted)

 

Goldman Sachs Lending Partners LLC

  $ 1,995         $ 1,875   

NOTE 13—Dividends

The Trust declared the following dividends to common shareholders from net investment income subsequent to August 31, 2013:

 

Declaration Date   Amount per Share        Record Date        Payable Date  

September 3, 2013

  $ 0.0305           September 13, 2013           September 30, 2013   

October 1, 2013

  $ 0.0305           October 11, 2013           October 31, 2013   

 

29                         Invesco Senior Income Trust


NOTE 14—Financial Highlights

The following schedule presents financial highlights for a common share of the Trust outstanding throughout the periods indicated.

 

    

Six months ended

August 31,

   

Year ended

February 28,

   

Year ended

February 29,

   

Seven months ended
February 28,

    Years ended July 31,  
  2013     2013     2012     2011     2010     2009     2008  

Net asset value per common share, beginning of period

  $ 5.17      $ 4.89      $ 5.03      $ 4.65      $ 3.98      $ 6.47      $ 8.06   

Net investment income(a)

    0.16        0.34        0.31        0.17        0.29        0.41        0.80   

Net gains (losses) on securities (both realized and unrealized)

    0.04        0.28        (0.14     0.39        0.72        (2.46     (1.57

Distributions paid to preferred shareholders from net investment income

            (0.01     (0.02     (0.01     (0.03     (0.05     (0.18

Total from investment operations

    0.20        0.61        0.15        0.55        0.98        (2.10     (0.95

Dividends from net investment income

    (0.18     (0.33     (0.29     (0.17     (0.29     (0.39     (0.64

Return of capital

                                (0.02              

Total dividends and distributions paid to common shareholders

    (0.18     (0.33     (0.29     (0.17     (0.31     (0.39     (0.64

Net asset value per common share, end of period

  $ 5.19      $ 5.17      $ 4.89      $ 5.03      $ 4.65      $ 3.98      $ 6.47   

Market value per common share, end of period

  $ 5.22      $ 5.57      $ 4.69      $ 5.01      $ 4.65      $ 3.59      $ 5.49   

Total return at net asset value(b)

    3.97     12.93     3.48     12.14                        

Total return at market value(c)

    (3.10 )%      26.86     (0.35 )%      11.70     38.95     (26.06 )%      (24.32 )% 

Net assets applicable to common shares, end of period (000’s omitted)

  $ 934,133      $ 930,435      $ 879,696      $ 904,599      $ 836,919      $ 717,102      $ 1,165,175   

Portfolio turnover rate(d)

    62     103     94     50     57     37     46

Ratios/supplemental data based on average net assets applicable to common shares outstanding:

   

           

Ratio of expenses:

             

With fee waivers and/or expense reimbursements

    2.18 %(e)      2.06     2.00 %(f)      2.14 %(f)(g)      2.28 %(f)(h)      3.69 %(f)      3.52 %(f) 

With fee waivers and/or expense reimbursements excluding interest, facilities and maintenance fees

    1.63 %(e)      1.65     1.69 %(f)      1.72 %(f)(g)      1.89 %(f)(h)      2.96 %(f)      2.26 %(f) 

Without fee waivers and/or expense reimbursements

    2.18 %(e)      2.06                                        

Ratio of net investment income before preferred share dividends

    6.14 %(e)      6.86     6.35     6.16 %(g)      6.38 %(h)      10.73     11.11

Preferred share dividends

            0.29     0.39     0.41 %(g)      0.61     1.37     2.44

Ratio of net investment income after preferred share dividends

    6.14 %(e)      6.57     5.96     5.75 %(g)      5.77 %(h)      9.36     8.67

Senior securities:

             

Total amount of preferred shares outstanding (000’s omitted)

  $ 125,000      $ 125,000      $ 200,000      $ 200,000      $ 200,000      $ 350,000      $ 350,000   

Total borrowings (000’s omitted)

  $ 240,000      $ 207,000      $ 156,000      $ 214,000      $ 230,000      $ 38,000      $ 551,000   

Asset coverage per $1,000 unit of senior indebtedness(i)

  $ 5,413      $ 6,099      $ 7,921      $ 6,162      $ 5,509      $ 29,083      $ 3,750   

Asset coverage per preferred share(j)

  $ 847,306      $ 844,348      $ 134,962      $ 138,075      $ 129,620      $ 76,225      $ 108,236   

Liquidating preference per preferred share

  $ 100,000      $ 100,000      $ 25,000      $ 25,000      $ 25,000      $ 25,000      $ 25,000   

 

(a)  Calculated using average shares outstanding.
(b)  Includes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value for financial reporting purposes and the returns based upon those net asset values may differ from the net asset value and returns for shareholder transactions. Not annualized for periods less than one year, if applicable.
(c)  Total return assumes an investment at the common share market price at the beginning of the period indicated, reinvestment of all distributions for the period in accordance with the Trust’s dividend reinvestment plan, and sale of all shares at the closing common share market price at the end of the period indicated. Not annualized for periods less than one year, if applicable.
(d)  Calculation includes the proceeds from principal repayments and sales of variable rate senior loan interests and is not annualized for periods less than one year, if applicable.
(e)  Ratios are annualized and based on average daily net assets applicable to common shares (000’s omitted) of $939,005.
(f)  Ratios do not reflect the effect of dividend payments to preferred shareholders.
(g)  Annualized.
(h)  Subsequent to issuance of its July 31, 2010 financial statements, the Trust identified an error solely related to the expense and net investment income ratios included within the financial highlights for the fiscal year ended July 31, 2010. The financial highlights above reflect the revised ratios.
(i)  Calculated by subtracting the Trust’s total liabilities (not including preferred shares and borrowings) from the Trust’s total assets and dividing by the total number of senior indebtedness units, where one unit equals $1,000 of senior indebtedness.
(j)  Calculated by subtracting the Trust’s total liabilities (not including preferred shares) from the Trust’s total assets and dividing by the total number of preferred shares outstanding.

 

30                         Invesco Senior Income Trust


NOTE 15—Legal Proceedings

Terms used in the Legal Proceedings Note are defined terms solely for the purpose of this note.

Pending Litigation and Regulatory Inquiries

On January 17, 2011, a Consolidated Amended Shareholder Derivative Complaint was filed by common shareholders on behalf of Invesco Advantage Municipal Income Trust II; Invesco Municipal Opportunity Trust; Invesco Municipal Trust; Invesco High Income Trust II; Invesco Senior Income Trust (the “Trusts”) against Van Kampen Asset Management, Morgan Stanley, and certain individuals (collectively, the “Defendants”) in Rotz v. Van Kampen Asset Management. The Plaintiffs alleged that Defendants breached their fiduciary duties to common shareholders by causing the Trusts to redeem Auction Rate Preferred Securities (“ARPS”) at their liquidation value, which was allegedly higher than from market value at the time, and by not having adequate procedures to deal with potential conflicts of interest. The Plaintiffs alleged that the redemptions of the ARPS wasted Trust assets, occurred at the expense of the Trusts and the common shareholders, and were improperly motivated to benefit preferred shareholders and Defendants. Additionally, the Plaintiffs claimed that the ARPS were replaced with less favorable financing. Plaintiffs seek judgment that: 1) orders Defendants to refrain from redeeming any ARPS at their liquidation value using Trusts assets; 2) awards monetary damages against all Defendants, individually, jointly or severally, in favor of the Trusts, for all losses and damages allegedly suffered as a result of the redemptions of ARPS at their liquidation value; 3) grants appropriate equitable relief to remedy the Defendants’ alleged breaches of fiduciary duties; and 4) awards to Plaintiffs the costs and disbursements of the action. On August 10, 2010, the Board of Trustees formed a Special Litigation Committee (“SLC”) to investigate the claims made in the April 2010 demand letters underlying the Complaint with the assistance of independent counsel. After reviewing the findings of the SLC and a vote by Independent Trustees, the Board announced on June 24, 2011, that the Independent Trustees had adopted the SLC recommendation to reject the demands and seek dismissal of the lawsuit. The Trusts filed a motion to dismiss on October 4, 2011, which remains pending.

Also, the Trust is named as a defendant in an adversary proceeding in the Bankruptcy Court of the Southern District of Florida. The complaint was filed on July 14, 2008 by the Official Committee of Unsecured Creditors of TOUSA, Inc., on behalf of certain subsidiaries of TOUSA, Inc. (the “Conveying Subsidiaries”), and filed as amended on October 17, 2008. The Committee made allegations against the Funds in two separate capacities: as “Transeastern Lenders” and as “First Lienholders” (collectively, the “Lenders”). The Transeastern Lenders loaned money to form a joint venture between TOUSA, Inc. and Falcone/Ritchie LLC. TOUSA, Inc. later repaid the loans from the Transeastern Lenders as part of a global settlement of claims against it. The repayment was financed using proceeds of new loans (the “New Loans”), for which the Conveying Subsidiaries conveyed first and second priority liens on their assets to two groups of lienholders (the First and Second Lienholders, collectively “New Lenders”). The Conveying Subsidiaries were not obligated on the original debt to the Transeastern Lenders. The Committee alleged, inter alia, that both the repayment to the Transeastern Lenders and the grant of liens to the First and Second Lienholders should be avoided as fraudulent transfers under the bankruptcy laws. More specifically, the Committee alleged: (1) that the Conveying Subsidiaries’ transfer of liens to secure the New Loans was a fraudulent transfer under 11 U.S.C. § 548 because the Conveying Subsidiaries were insolvent at the time of the transfer and did not receive reasonably equivalent value for the liens; and (2) that the Transeastern Lenders were, under 11 U.S.C. § 550, entities for whose benefit the liens were fraudulently transferred to the New Lenders. The case was tried in 2009 and on October 13, 2009, the Bankruptcy Court rendered a Final Judgment against the Lenders, which was later amended on October 30, 2009, requiring the Lenders to post bonds equal to 110% of the damages and disgorgement ordered against them. The Transeastern Lenders and First Lienholders separately appealed the decision to the District Court for the Southern District of Florida. On February 11, 2011, the District Court, issued an order in the Transeastern Lenders’ appeal that: 1) quashed the Bankruptcy Court’s Order as it relates to the liability of the Transeastern Lenders; 2) made null and void the Bankruptcy Court’s imposition of remedies as to the Transeastern Lenders; 3) discharged all bonds deposited by Transeastern Lenders, unless any further appeals are filed, in which case the bonds would remain in effect pending resolution of appeals; 4) dismissed as moot additional appeal proceedings of the Transeastern Lenders that were contingent upon the District Court’s decision concerning liability; and 5) closed all District Court appeal proceedings concerning the Transeastern Lenders. The Committee appealed to the Eleventh Circuit Court of Appeals. The First Lienholders’ appeal was stayed pending a decision by the Eleventh Circuit. In a decision filed on May 15, 2012, the Eleventh Circuit reversed the District Court’s opinion, affirmed the liability findings of the Bankruptcy Court against the Transeastern Lenders, and remanded the case to the District Court to review the remedies ordered by the Bankruptcy Court. The appeal of the Transeastern Lenders is currently pending before the District Court. The First Lienholders, having paid its obligations under the bankruptcy plan, have been fully and finally released pursuant to a court order dated August 30, 2013.

The Trust has accrued $82,681 in expenses relating to these matters during the six months ending August 31, 2013.

Management of Invesco and the Trust believe that the outcome of the proceedings described above will have no material adverse effect on the Trust or on the ability of Invesco to provide ongoing services to the Trust.

 

31                         Invesco Senior Income Trust


Approval of Investment Advisory and Sub-Advisory Contracts

 

The Board of Trustees (the “Board”) of Invesco Senior Income Trust (the “Fund”) is required under the Investment Company Act of 1940 to approve annually the renewal of the investment advisory agreement with Invesco Advisers, Inc. (“Invesco Advisers”) and the Master Intergroup Sub-Advisory Contract (the “sub-advisory contracts”) with Invesco Asset Management Deutschland GmbH, Invesco Asset Management Ltd., Invesco Asset Management (Japan) Limited, Invesco Australia Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc. and Invesco Canada Ltd. (collectively, the “Affiliated Sub-Advisers”). The Board considers the Fund’s relationship with Invesco Advisers and the Affiliated Sub-Advisers throughout the year and during meetings held on March 4-5, 2013 and May 6-7, 2013, the Board considered matters related to the continuance of the Fund’s investment advisory agreement and the sub-advisory contracts. During a contract renewal meeting held on May 7, 2013, the Board as a whole, and the disinterested or “independent” Trustees, who comprise more than 75% of the Board, voting separately, approved the continuance of the Fund’s investment advisory agreement and the sub-advisory contracts for another year. In doing so, the Board considered the process that it follows in reviewing and approving the Fund’s investment advisory agreement and sub-advisory contracts and the information that it is provided. In arriving at its decision to approve the Agreements, the Board did not identify any single factor or group of factors as all important or controlling, but considered all factors together, and different Board Members may have attributed different weights to the various factors considered. The Board determined that the Fund’s investment advisory agreement and the sub-advisory contracts are in the best interests of the Fund and its shareholders and the compensation to Invesco Advisers and the Affiliated Sub-Advisers under the agreements is fair and reasonable.

The Board’s Fund Evaluation Process

The Board, acting directly and through its committees, meets throughout the year to review the performance of the Fund. Over the course of each year, the Board, acting directly and through its committees, meets with portfolio managers for the funds and other members of management to review the performance, investment objective(s), policies, strategies and limitations and investment risks of the funds. The Board meets regularly and at designated contract renewal meetings each year to conduct a review of the performance, fees, expenses and other matters related to the funds.

During the contract renewal process, the Trustees receive comparative performance and fee data regarding the funds prepared by

Invesco Advisers and an independent company, Lipper, Inc. (“Lipper”). The independent Trustees are assisted in their annual evaluation of the funds’ investment advisory agreements by fund counsel.

In evaluating the fairness and reasonableness of the Fund’s investment advisory agreement and sub-advisory contracts, the Board considered, among other things, the factors discussed below. The Trustees recognized that the advisory fees for the Fund reflect the results of years of review and negotiation between the Trustees and Invesco Advisers, as well as with Van Kampen Asset Management, the funds’ predecessor investment adviser. The Trustees’ deliberations and conclusions in a particular year may be based in part on their deliberations and conclusions regarding these same arrangements throughout the year and in prior years. The Board noted the willingness of Invesco Advisers personnel to engage in open and candid discussions with the Board. One Trustee may have weighed a particular piece of information differently than another Trustee.

The discussion below is a summary of the Board’s evaluation with respect to the Fund’s investment advisory agreement as well as a discussion of the material factors and related conclusions that formed the basis for the Board’s approval of the Fund’s investment advisory agreement and sub-advisory contracts. Unless otherwise stated, this information is current as of May 7, 2013, and may not reflect consideration of factors that became known to the Board after that date, including, for example, changes to the Fund’s performance, advisory fees, expense limitations and/or fee waivers.

Factors and Conclusions

A. Nature, Extent and Quality of Services Provided by Invesco Advisers and the Affiliated Sub-Advisers

The Board reviewed the advisory services provided to the Fund by Invesco Advisers under the Fund’s investment advisory agreement, the performance of Invesco Advisers in providing these services, and the credentials and experience of the officers and employees of Invesco Advisers who provide these services. The Board also meets throughout the year with the Fund’s portfolio management team, which provides the Board with insight into their management of the Fund and the Fund’s performance. The Board’s review of the qualifications of Invesco Advisers and the portfolio management team to provide advisory services included the Board’s consideration of Invesco Advisers’ performance and investment process oversight, independent credit analysis and investment risk management.

In determining whether to continue the Fund’s investment advisory agreement, the Board considered the prior relationship between Invesco Advisers (and previously Van Kampen

Asset Management) and the Fund, as well as the Board’s knowledge of Invesco Advisers’ operations, and the greater uncertainty that may be associated with entering into a new relationship. The Board also considered non-advisory services that Invesco Advisers and its affiliates provide to the Fund such as various back office support functions, equity and fixed income trading operations, internal audit and legal and compliance. The Board concluded that the nature, extent and quality of the services provided to the Fund by Invesco Advisers are appropriate and satisfactory and the advisory services are provided in accordance with the terms of the Fund’s investment advisory agreement.

The Board reviewed the services capable of being provided by the Affiliated Sub-Advisers under the sub-advisory contracts and the credentials and experience of the officers and employees of the Affiliated Sub-Advisers who would provide such services. The Board concluded that the sub-advisory contracts benefit the Fund and its shareholders by permitting Invesco Advisers to use the resources and talents of the Affiliated Sub-Advisers, from time to time as necessary and appropriate, in managing the Fund. The Board concluded that the nature, extent and quality of the services capable of being provided by the Affiliated Sub-Advisers are appropriate and satisfactory and in accordance with the terms of the Fund’s sub-advisory contracts.

B. Fund Performance

The Board considered Fund performance as a relevant factor in considering whether to approve the investment advisory agreement. The Board did not view Fund performance as a relevant factor in considering whether to approve the sub-advisory contracts for the Fund, as no Affiliated Sub-Adviser currently manages assets of the Fund.

The Board compared the Fund’s performance during the past one, two, three, five and ten calendar years to the performance of funds in the Fund’s Lipper performance universe and against the applicable Lipper index. The Board noted that the Fund’s performance was in the first quintile of its performance universe for the one, two and three year periods and the fifth quintile for the five and ten year periods (the first quintile being the best performing funds and the fifth quintile being the worst performing funds). In light of these considerations, the Board concluded the Fund’s performance was consistent with its investment objective and policies under applicable market conditions.

C. Advisory and Sub-Advisory Fees and Fee Waivers

The Board compared the Fund’s contractual advisory fee rate to the contractual advisory fee rates of funds in the Fund’s Lipper expense group at a common asset level. The Board noted that the Fund’s contractual advisory fee rate

 

 

32                         Invesco Senior Income Trust


was above the median contractual advisory fee rate of funds in its expense group. The Board also reviewed the methodology used by Lipper in providing expense group information, which includes using audited financial data from the most recent annual report of each fund in the expense group that was publicly available as of the end of the past calendar year and including only one fund per investment adviser. The Board noted that comparative data is as of varying dates, which may affect the comparability of data during times of market volatility.

The Board also considered the Fund’s effective advisory fee rate (the advisory fee rate after advisory fee waivers and before other expense limitations and waivers), including comparisons, as applicable, to the effective advisory fee rates of other funds advised by Invesco Advisers and its affiliates with investment strategies similar to those of the Fund. The Board reviewed not only the advisory fees but other fees and expenses (whether paid to Invesco Advisers, its affiliates or others) and the Fund’s overall expense ratio.

The Board also compared the strategy of the Fund to that of other client accounts of Invesco Advisers and the Affiliated Sub-Advisers and considered, as applicable, the fees charged to other client accounts with investment strategies similar to those of the Fund. The Board noted that Invesco Advisers or the Affiliated Sub-Advisers may charge lower fees to large institutional clients solely for investment management services than to registered fund clients, such as the Fund. Invesco Advisers reviewed with the Board the significantly greater scope of services it provides to registered fund clients, including the Fund, relative to other client accounts. These additional services include provision of administrative services, officers and office space, oversight of service providers, preparation of shareholder reports, efforts to support secondary market trading of the Fund’s shares, preparation of financial information and regulatory compliance under the Investment Company Act of 1940, as amended, and stock exchange listing standards, including preparation for, coordinating the solicitation of proxies for, and conducting annual shareholder meetings. The Board noted that sub-advisory fees charged by the Affiliated Sub-Advisers to manage registered fund clients and to manage other client accounts were often more comparable. The Board concluded that the aggregate services provided to the Fund were sufficiently different from those provided to institutional clients, and the Board did not place significant weight on these fee comparisons.

The Board noted that Invesco Advisers has contractually agreed to waive fees and/or limit expenses of the Fund through at least June 30, 2012 in an amount necessary to limit total annual operating expenses to a specified percentage of average daily net assets for each class of the Fund. The Board also considered the effect this fee waiver, and the discontinuation

of this fee waiver on June 30, 2013, would have on the Fund’s total estimated expenses.

The Board also considered the services capable of being provided by the Affiliated Sub-Advisers pursuant to the sub-advisory contracts, as well as the allocation of fees between Invesco Advisers and the Affiliated Sub-Advisers pursuant to the sub-advisory contracts. The Board noted that, to the extent the Fund were to utilize the Affiliated Sub-Advisers, Invesco Advisers would provide services related to oversight of the Affiliated Sub-Advisers as well as the additional services described above other than day-to-day portfolio management. The Board also noted that the sub-advisory fees have no direct effect on the Fund or its shareholders, as they are paid by Invesco Advisers to the Affiliated Sub-Advisers.

Based upon the information and considerations described above, the Board concluded that the Fund’s advisory and sub-advisory fees are fair and reasonable.

D. Economies of Scale and Breakpoints

The Board considered the extent to which there are economies of scale in the provision of advisory services to the Fund. The Board noted that the Fund, like most closed-end funds, does not have fund level breakpoints because closed-end funds generally do not experience substantial asset growth after the initial public offering. The Board noted that although the Fund does not benefit from economies of scale through contractual breakpoints, the Fund does share directly in economies of scale through lower fees charged by third party service providers based on the combined size of the registered fund clients and other clients advised by Invesco Advisers.

E. Profitability and Financial Resources

The Board reviewed information from Invesco Advisers concerning the costs of the advisory and other services that Invesco Advisers and its affiliates provide to the Fund and the profitability of Invesco Advisers and its affiliates in providing these services for the year ended December 31, 2012. The Board reviewed with Invesco Advisers the methodology used to prepare the profitability information. The Board considered the profitability of Invesco Advisers in connection with managing the Fund and the other funds overseen by the Board. The Board noted that Invesco Advisers continues to operate at a net profit from services Invesco Advisers and its subsidiaries provide to the Fund and the other funds overseen by the Board. The Board concluded that the level of profits realized by Invesco Advisers and its affiliates from providing services to the Fund is not excessive given the nature, quality and extent of the services provided to the Fund. The Board considered whether Invesco Advisers and each Affiliated Sub-Adviser are financially sound and have the resources necessary to perform their obligations under the investment advisory agreement and sub-advisory contracts. The Board concluded that Invesco Advisers and each Affiliated Sub-Adviser have the financial resources necessary to fulfill these obligations.

F. Collateral Benefits to Invesco Advisers and its Affiliates

The Board considered various other benefits received by Invesco Advisers and its affiliates from the relationship with the Fund, including the fees received for their provision of administrative services to the Fund. The Board considered the performance of Invesco Advisers and its affiliates in providing these services and the organizational structure employed to provide these services. The Board also considered that the services are required for the operation of the Fund; that Invesco Advisers and its affiliates can provide services, the nature and quality of which are at least equal to those provided by others offering the same or similar services; and that the fees for such services are fair and reasonable in light of the usual and customary charges by others for services of the same nature and quality.

The Board considered that the Fund’s uninvested cash and cash collateral from any securities lending arrangements may be invested in money market funds advised by Invesco Advisers pursuant to procedures approved by the Board. The Board noted that Invesco Advisers receives advisory fees from these affiliated money market funds attributable to such investments, although Invesco Advisers has contractually agreed to waive through varying periods the advisory fees payable by the Fund. The waiver is in an amount equal to 100% of the net advisory fee Invesco Advisers receives from the affiliated money market funds with respect to the Fund’s investment in the affiliated money market funds of uninvested cash, but not cash collateral. The Board concluded that the Fund’s investment of uninvested cash and cash collateral from any securities lending arrangements in the affiliated money market funds is in the best interests of the Fund and its shareholders.

 

 

33                         Invesco Senior Income Trust


Proxy Results

An Annual Meeting (“Meeting”) of Shareholders of Invesco Senior Income Trust (the “Fund”) was held on August 2, 2013. The Meeting was held for the following purpose:

 

(1) Elect three Class III Trustees, two by the holders of Common Shares and the holders of Preferred Shares of the Fund voting together as a single class, and one by the holders of Preferred Shares of the Fund, voting separately, each of whom will serve for a three-year term or until a successor shall have been duly elected and qualified.

The results of the voting on the above matter were as follows:

 

     Matter    Votes For       

Votes

Against

       Votes
Abstain
 
(1)   R. Craig Kennedy      159,580,141           6,441,447           1,233   
  Colin D. Meadows      159,580,141           6,441,447           1,233   
  Hugo F. Sonnenschein(P)      1,250           0           0   

 

(P)  Election of Trustee by preferred shareholders only.

 

34                         Invesco Senior Income Trust


 

 

 

Correspondence information

Send general correspondence to Computershare, P.O. Box 43078, Providence, RI 02940-3078.

 

 

Invesco privacy policy

You share personal and financial information with us that is necessary for your transactions and your account records. We take very seriously the obligation to keep that information confidential and private.

Invesco collects nonpublic personal information about you from account applications or other forms you complete and from your transactions with us or our affiliates. We do not disclose information about you or our former customers to service providers or other third parties except to the extent necessary to service your account and in other limited circumstances as permitted by law. For example, we use this information to facilitate the delivery of transaction confirmations, financial reports, prospectuses and tax forms.

Even within Invesco, only people involved in the servicing of your accounts and compliance monitoring have access to your information. To ensure the highest level of confidentiality and security, Invesco maintains physical, electronic and procedural safeguards that meet or exceed federal standards. Special measures, such as data encryption and authentication, apply to your communications with us on our website. More detail is available to you at invesco.com/privacy.

 

 

Trust holdings and proxy voting information

The Trust provides a complete list of its holdings four times in each fiscal year, at the quarter ends. For the second and fourth quarters, the lists appear in the Trust’s semiannual and annual reports to shareholders. For the first and third quarters, the Trust files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. The most recent list of portfolio holdings is available at invesco.com/completeqtrholdings. Shareholders can also look up the Trust’s Forms N-Q on the SEC website at sec.gov. Copies of the Trust’s Forms N-Q may be reviewed and copied at the SEC Public Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following email address: publicinfo@sec.gov. The SEC file number for the Trust is shown below.

A description of the policies and procedures that the Trust uses to determine how to vote proxies relating to portfolio securities is available without charge, upon request, from our Client Services department at 800 341 2929 or at invesco.com/proxyguidelines. The information is also available on the SEC website, sec.gov.

Information regarding how the Trust voted proxies related to its portfolio securities during the most recent 12-month period ended June 30 is available at invesco.com/proxysearch. In addition, this information is available on the SEC website at sec.gov.

  LOGO
SEC file number: 811-08743                    VK-CE-SINC-SAR-1  


ITEM 2. CODE OF ETHICS.

There were no amendments to the Code of Ethics (the “Code”) that applies to the Registrant’s Principal Executive Officer (“PEO”) and Principal Financial Officer (“PFO”) during the period covered by the report. The Registrant did not grant any waivers, including implicit waivers, from any provisions of the Code to the PEO or PFO during the period covered by this report.

 

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

Not applicable.

 

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Not applicable.

 

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

Not applicable.

 

ITEM 6. SCHEDULE OF INVESTMENTS.

Investments in securities of unaffiliated issuers is included as part of the reports to stockholders filed under Item 1 of this Form.

 

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

 

ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

 

ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.

Not applicable.

 

ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None.

 

ITEM 11. CONTROLS AND PROCEDURES.

 

(a)

As of August 13, 2013, an evaluation was performed under the supervision and with the participation of the officers of the Registrant, including the Principal Executive Officer (“PEO”) and Principal Financial Officer (“PFO”), to assess the effectiveness of the Registrant’s disclosure controls and procedures, as that term is defined in Rule 30a-3(c) under the Investment Company Act of 1940 (the “Act”), as amended. Based on that evaluation, the Registrant’s officers, including the PEO and PFO, concluded that, as of August 13, 2013, the Registrant’s disclosure controls and procedures were reasonably designed to ensure: (1) that information required to be disclosed by the Registrant on Form N-CSR is


  recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Securities and Exchange Commission; and (2) that material information relating to the Registrant is made known to the PEO and PFO as appropriate to allow timely decisions regarding required disclosure.

 

(b) There have been no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the period covered by the report that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting.

 

ITEM 12. EXHIBITS.
12(a) (1)    Not applicable.
12(a) (2)    Certifications of principal executive officer and principal financial officer as required by Rule 30a-2(a) under the Investment Company Act of 1940.
12(a) (3)    Not applicable.
12(b)    Certifications of principal executive officer and principal financial officer as required by Rule 30a-2(b) under the Investment Company Act of 1940.


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.

Registrant: Invesco Senior Income Trust

 

By:  

/s/ Colin Meadows

  Colin Meadows
  Principal Executive Officer
Date:   November 8, 2013

Pursuant to the requirements of the Securities and 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/ Colin Meadows

  Colin Meadows
  Principal Executive Officer
Date:   November 8, 2013

 

By:  

/s/ Sheri Morris

  Sheri Morris
  Principal Financial Officer
Date:   November 8, 2013


EXHIBIT INDEX

 

12(a) (1)    Not applicable.
12(a) (2)    Certifications of principal executive officer and Principal financial officer as required by Rule 30a-2(a) under the Investment Company Act of 1940.
12(a) (3)    Not applicable.
12(b)    Certifications of principal executive officer and Principal financial officer as required by Rule 30a-2(b) under the Investment Company Act of 1940.