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<SEC-DOCUMENT>0000928816-10-000685.txt : 20100701
<SEC-HEADER>0000928816-10-000685.hdr.sgml : 20100701
<ACCEPTANCE-DATETIME>20100701131213
ACCESSION NUMBER:		0000928816-10-000685
CONFORMED SUBMISSION TYPE:	N-CSRS
PUBLIC DOCUMENT COUNT:		6
CONFORMED PERIOD OF REPORT:	20100430
FILED AS OF DATE:		20100701
DATE AS OF CHANGE:		20100701
EFFECTIVENESS DATE:		20100701

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			HANCOCK JOHN INCOME SECURITIES TRUST /MA
		CENTRAL INDEX KEY:			0000759866
		IRS NUMBER:				000000000
		STATE OF INCORPORATION:			MA
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		N-CSRS
		SEC ACT:		1940 Act
		SEC FILE NUMBER:	811-04186
		FILM NUMBER:		10929972

	BUSINESS ADDRESS:	
		STREET 1:		C/O JOHN HANCOCK FUNDS
		STREET 2:		601 CONGRESS STREET
		CITY:			BOSTON
		STATE:			MA
		ZIP:			02210
		BUSINESS PHONE:		617-663-3000

	MAIL ADDRESS:	
		STREET 1:		C/O JOHN HANCOCK FUNDS
		STREET 2:		601 CONGRESS STREET
		CITY:			BOSTON
		STATE:			MA
		ZIP:			02210
</SEC-HEADER>
<DOCUMENT>
<TYPE>N-CSRS
<SEQUENCE>1
<FILENAME>a_incsecuritiestrust.htm
<DESCRIPTION>JOHN HANCOCK INCOME SECURITIES TRUST
<TEXT>
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<TR>
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     <TD colSpan=2 noWrap align=center><FONT face=sans-serif>UNITED STATES</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><FONT face=sans-serif>SECURITIES AND EXCHANGE COMMISSION</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><FONT face=sans-serif>Washington, D.C. 20549</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=center>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><B><FONT face=sans-serif>FORM N-CSR</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><B><FONT face=sans-serif>CERTIFIED SHAREHOLDER REPORT OF REGISTERED</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><B><FONT face=sans-serif>MANAGEMENT INVESTMENT COMPANIES</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=center>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><FONT face=sans-serif>Investment Company Act file number </FONT><U><FONT face=sans-serif>811- 4186</FONT></U>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=center>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><U><FONT face=sans-serif>John Hancock Income Securities Trust</FONT></U>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><FONT face=sans-serif>(Exact name of registrant as specified in charter)</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><U><FONT face=sans-serif>601 Congress Street, Boston, Massachusetts 02210</FONT></U>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><FONT face=sans-serif>(Address of principal executive offices) (Zip code)</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=center>&nbsp;&nbsp;&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><FONT face=sans-serif>Salvatore Schiavone</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><FONT face=sans-serif>Treasurer</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=center>&nbsp;&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><FONT face=sans-serif>601 Congress Street</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=center>&nbsp;&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><U><FONT face=sans-serif>Boston, Massachusetts 02210</FONT></U>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=center><FONT face=sans-serif>(Name and address of agent for service)</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT face=sans-serif>Registrant's telephone number, including area code: </FONT><U><FONT face=sans-serif>617-663-4497</FONT></U>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT face=sans-serif>Date of fiscal year end:</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=left><FONT face=sans-serif>October 31</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT face=sans-serif>Date of reporting period:</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT face=sans-serif>April 30, 2010</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><FONT face=sans-serif>Item 1. Schedule of Investments.</FONT>&nbsp;</TD></TR></TABLE><BR>
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<P style="TEXT-ALIGN: left"><FONT size=7 face=serif>Portfolio summary</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="23%"></TD>
     <TD width="23%"></TD>
     <TD width="7%"></TD>
     <TD width="23%"></TD>
     <TD width="23%" align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Portfolio Composition</FONT></B><SUP><FONT size=1 face=sans-serif>1</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD></TR>
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     <TD colSpan=5 noWrap align=left>
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</TD></TR>
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     <TD noWrap align=left><FONT size=1 face=sans-serif>Corporate Bonds</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>71%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Preferred Stocks</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2%</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD>
     <TD noWrap align=left></TD>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>U.S. Government &amp;</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Asset-Backed Securities</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Agency Obligations</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>19%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
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     <TD colSpan=2>
<HR SIZE=1 noShade>
</TD>
     <TD></TD>
     <TD><FONT size=1 face=sans-serif>Other Securities</FONT>&nbsp;&nbsp;</TD>
     <TD align=right><FONT size=1 face=sans-serif>1%</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD vAlign=center noWrap align=left><FONT size=1 face=sans-serif>Collateralized Mortgage Obligations</FONT>&nbsp;</TD>
     <TD vAlign=center noWrap align=right><FONT size=1 face=sans-serif>6%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
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     <TD colSpan=2>
<HR SIZE=1 noShade>
</TD>
     <TD></TD>
     <TD colSpan=2></TD></TR>
<TR>
     <TD colSpan=5>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Sector Composition</FONT></B><SUP><FONT size=1 face=sans-serif>1,2</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD></TR>
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     <TD colSpan=5 noWrap align=left>
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</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Financials</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>27%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Materials</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5%</FONT>&nbsp;</TD></TR>
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     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD>
     <TD noWrap align=left></TD>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>U.S. Government Agency</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>19%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Mortgage Bonds</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5%</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD>
     <TD noWrap align=left></TD>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Energy</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Telecommunication Services</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4%</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD>
     <TD noWrap align=left></TD>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Consumer Discretionary</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Health Care</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3%</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD>
     <TD noWrap align=left></TD>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Industrials</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Information Technology</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1%</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD>
     <TD noWrap align=left></TD>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Consumer Staples</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Short-Term Investments</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1%</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD>
     <TD noWrap align=left></TD>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Utilities</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>
<HR SIZE=1 noShade>
</TD>
     <TD></TD>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR>
     <TD colSpan=5>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Quality Distribution</FONT></B><SUP><FONT size=1 face=sans-serif>1</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>AAA</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>21%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>
<HR SIZE=1 noShade>
</TD>
     <TD></TD>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>AA</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>
<HR SIZE=1 noShade>
</TD>
     <TD></TD>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>A</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>20%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD></TR>
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     <TD colSpan=2>
<HR SIZE=1 noShade>
</TD>
     <TD></TD>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>BBB</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>30%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD></TR>
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     <TD colSpan=2>
<HR SIZE=1 noShade>
</TD>
     <TD></TD>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>BB</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>
<HR SIZE=1 noShade>
</TD>
     <TD></TD>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>B</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>
<HR SIZE=1 noShade>
</TD>
     <TD></TD>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CCC</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>
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     <TD colSpan=2>&nbsp;</TD></TR>
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     <TD noWrap align=left><FONT size=1 face=sans-serif>Not Rated</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2%</FONT>&nbsp;</TD>
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     <TD noWrap align=right>&nbsp;</TD></TR>
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     <TD></TD>
     <TD colSpan=2>&nbsp;</TD></TR>
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     <TD noWrap align=left><FONT size=1 face=sans-serif>Short-Term Investments and Other</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD></TR>
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<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>1 </FONT></SUP><FONT size=1 face=sans-serif>As a percentage of the Fund&#146;s total investments on April 30, 2010.</FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>2 </FONT></SUP><FONT size=1 face=sans-serif>Sector investing is subject to greater risks than the market as a whole. Because the Fund may focus on particular sectors of the economy, its performance may depend on the performance of those sectors.</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD style="TEXT-INDENT: 0px" width="4%"></TD>
     <TD width="96%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=sans-serif>6</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD></TR></TABLE><BR>
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<P style="TEXT-ALIGN: left"><FONT size=7 face=serif>Fund&#146;s investments</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=4 face=sans-serif>As of 4-30-10 </FONT><FONT size=2 face=sans-serif>(unaudited)</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="43%"></TD>
     <TD width="12%"></TD>
     <TD width="10%"></TD>
     <TD width="10%"></TD>
     <TD width="12%"></TD>
     <TD width="12%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=center></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Maturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Corporate Bonds 103.60%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$169,866,608</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=6 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>(Cost $161,720,271)</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Consumer Discretionary 11.47%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>18,808,625</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Auto Components 0.80%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Allison Transmission, Inc. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>11.000%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-01-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$485,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>523,800</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Exide Technologies, Series B (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>445,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>455,557</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Tenneco, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>320,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>329,600</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Auto Manufacturers 0.35%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Volvo Treasury AB (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.950</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-01-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>555,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>574,705</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Hotels, Restaurants &amp; Leisure 2.57%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Greektown Holdings LLC (H)(S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-01-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,015,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>67,244</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Jacobs Entertainment, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>600,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>573,750</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Little Traverse Bay Bands of Odawa</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>&nbsp;&nbsp;&nbsp; Indiansl (H)(S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>500,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>131,250</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>MGM Mirage, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>100,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>105,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>MTR Gaming Group, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>12.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>175,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>183,750</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>MTR Gaming Group, Inc., Series B (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>390,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>329,550</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Pokagon Gaming Authority (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>500,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>525,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Seminole Indian Tribe of Florida (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.535</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-01-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>650,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>588,400</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Turning Stone Resort Casino Enterprises (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,540,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,534,225</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Waterford Gaming LLC (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>274,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>175,360</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Household Durables 0.74%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Libbey Glass, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>95,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>100,344</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Whirlpool Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.600</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>335,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>392,090</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Whirlpool Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>660,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>724,231</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Media 5.83%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>AMC Entertainment, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>125,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>132,500</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Cablevision Systems Corp. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-15-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>135,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>142,425</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Canadian Satellite Radio Holdings, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>12.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>979,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>827,255</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CCH II LLC / CCH II Capital Corp. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>13.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-30-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>306,006</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>367,207</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Cinemark USA, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>180,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>190,800</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Comcast Cable Holdings LLC (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.800</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-01-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,500,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,696,362</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CSC Holdings, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>390,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>413,400</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>DirecTV Holdings LLC (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>850,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>948,813</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>DirecTV Holdings LLC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.350</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-40</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>220,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>227,250</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>DirecTV Holdings LLC</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-01-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>280,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>296,030</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Grupo Televisa SA</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-40</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>290,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>297,494</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="60%"></TD>
     <TD width="36%"></TD>
     <TD width="4%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=right><FONT size=2 face=sans-serif>7</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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     <TD noWrap align=center></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Maturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Media (continued)</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>News America Holdings, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.750%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-20-24</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$1,020,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$1,235,218</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>News America Holdings, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.600</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-11-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,156,047</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Nexstar Broadcasting, Inc., PIK (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>254,724</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>234,346</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Nexstar Finance, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>84,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>77,280</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Regal Cinemas Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>115,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>121,900</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Time Warner Cable, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-01-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>605,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>685,934</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Viacom, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-30-30</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>350,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>397,260</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>XM Satellite Radio, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>11.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>100,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>109,750</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Personal Products 0.20%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Revlon Consumer Products Corp. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>320,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>328,800</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Specialty Retail 0.67%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Advance Auto Parts, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>480,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>488,751</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Staples, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>500,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>612,453</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Textiles, Apparel &amp; Luxury Goods 0.31%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Burlington Coat Factory Warehouse Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>11.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>395,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>415,244</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Phillips-Van Heusen Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>90,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>92,250</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp; </TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Consumer Staples 7.72%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>12,655,328</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Beverages 2.17%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Anheuser-Busch InBev Worldwide, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,038,151</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>PepsiCo, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.900</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-01-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>395,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>498,253</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>SABMiller PLC (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>465,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>529,136</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>SABMiller PLC (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,365,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,489,062</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Food &amp; Staples Retailing 0.78%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CVS Caremark Corp.,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>(6.302% to 06-01-2012, then 3 month LIBOR</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>&nbsp;&nbsp;&nbsp; + 2.065%) (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.302</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-37</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,230,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,186,950</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Susser Holdings LLC / Susser Finance Corp. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>95,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>95,950</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Food Products 2.20%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bunge Ltd. Finance Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>350,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>415,742</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bunge Ltd. Finance Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.350</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,040,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,100,204</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Corp. Pesquera Inca SAC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-10-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>230,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>233,738</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Kraft Foods, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-11-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>685,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>759,103</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Kraft Foods, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-10-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>740,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>767,538</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Smithfield Foods, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>300,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>336,750</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Household Products 0.29%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Yankee Acquisition Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>455,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>472,063</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
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     <TD noWrap align=left></TD>
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<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Tobacco 2.28%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
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<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Alliance One International, Inc. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,060,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Alliance One International, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>245,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>254,188</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Altria Group, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-10-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>800,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>940,342</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Lorillard Tobacco Company</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>355,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>364,889</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Reynolds American, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,113,269</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Energy 12.29%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>20,150,721</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Energy Equipment &amp; Services 1.68%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Gibson Energy Holdings ULC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>265,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>265,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>MidAmerican Energy Holdings Company (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.480</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-15-28</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>550,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>691,266</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>NGPL Pipeco LLC (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.119</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-15-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,580,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,795,992</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="4%"></TD>
     <TD width="48%"></TD>
     <TD width="48%"></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 0px" noWrap align=left><FONT size=2 face=sans-serif>8</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD></TR></TABLE><BR>
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<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="43%"></TD>
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     <TD noWrap align=left>&nbsp;</TD>
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     <TD noWrap align=center></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Maturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Oil, Gas &amp; Consumable Fuels 10.61%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Arch Coal, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.750%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-01-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$100,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$106,500</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>ConocoPhillips (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.400</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,072,527</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Drummond Company, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>290,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>285,650</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>El Paso Pipeline Partners Operating</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Company LLC</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-01-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>280,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>289,034</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Energy Transfer Partners LP (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.700</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>330,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>426,455</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Energy Transfer Partners LP (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,174,063</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Enterprise Products Operating LLC,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>&nbsp;(7.000% to 06-01-2017, then 3 month LIBOR</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>&nbsp;+ 2.778%) (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-67</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>695,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>653,300</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Enterprise Products Operating LLC,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>&nbsp;(7.034% to 01-15-18, then 3 month LIBOR</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>&nbsp;+ 2.68%) (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.034</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-68</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>590,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>570,088</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Gulf South Pipeline Company LP (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,079,254</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Kinder Morgan Energy Partners LP (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-01-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>505,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>646,323</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Kinder Morgan Energy Partners LP (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-32</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>195,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>232,744</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Linn Energy LLC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>185,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>191,938</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>MarkWest Energy Partners LP, Series B (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>545,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>561,350</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>McMoRan Exploration Company (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>11.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>340,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>362,950</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Motiva Enterprises LLC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.850</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-40</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>280,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>311,516</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Niska Gas Storage US LLC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>395,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>412,775</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>NuStar Logistics LP (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.650</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>845,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>959,515</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>ONEOK Partners LP (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.150</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-01-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>705,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>783,944</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Pan American Energy LLC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-07-21</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>230,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>225,869</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Petro-Canada (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-15-21</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,341,730</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Petro-Canada (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.050</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>400,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>441,070</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Plains All American Pipeline LP (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-01-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>600,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>626,666</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Regency Energy Partners LP (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>280,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>300,300</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Spectra Energy Capital LLC (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.200</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,097,166</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Thermon Industries, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>100,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>102,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Williams Partners LP (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-01-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,740,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2,004,635</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Woodside Finance, Ltd. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-10-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,100,098</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,139,101</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Financials 36.11%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>59,216,553</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Capital Markets 3.92%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Charles Schwab Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.950</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>900,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>967,638</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Jefferies Group, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>490,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>530,821</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Jefferies Group, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.450</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-08-27</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>285,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>262,054</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Macquarie Group, Ltd. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.300</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-01-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>270,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>305,627</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Macquarie Group, Ltd. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-14-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>340,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>347,202</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Morgan Stanley (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.300</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-13-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>485,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>532,568</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Morgan Stanley</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-01-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,060,248</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Morgan Stanley</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.100</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-26-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>500,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>494,238</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Northern Trust Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>225,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>256,698</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Northern Trust Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>370,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>395,603</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>The Goldman Sachs Group, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>150,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>166,546</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>The Goldman Sachs Group, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.150</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-01-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>760,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>787,286</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>The Goldman Sachs Group, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>335,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>325,396</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="72%"></TD>
     <TD width="24%" align=right></TD>
     <TD style="TEXT-INDENT: 0px" width="4%" align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=2 face=sans-serif>9</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="43%"></TD>
     <TD width="12%"></TD>
     <TD width="10%"></TD>
     <TD width="10%"></TD>
     <TD width="12%"></TD>
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<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=center></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Maturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Commercial Banks 5.58%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bank of Nova Scotia (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;<FONT size=1 face=sans-serif>3.400%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-22-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$1,012,987</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Barclays Bank PLC,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(6.860% to 6-15-2032 then 6 month LIBOR +</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>1.73%) (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.860</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-29-49</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,655,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,514,325</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>BPCE SA,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(12.50% to 09-30-2019 then 3 month LIBOR</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>+ 12.98%) (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>12.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-29-49</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>330,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>396,792</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Chuo Mitsui Trust &amp; Banking Company, Ltd.,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(5.506% to 04-15-2015, then 3 month LIBOR</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>+ 2.49%) (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.506</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-29-49</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>940,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>924,659</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Commonwealth Bank of Australia (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-19-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>555,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>562,264</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Credit Suisse New York (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.300</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-13-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>415,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>434,143</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Regions Financial Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-10-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,079,866</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Santander Issuances SA,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(6.500% to 11-01-2014, then 3 month LIBOR</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>+ 3.92%) (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-11-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>600,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>635,846</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Sovereign Capital Trust VI (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.908</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-13-36</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>480,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>455,634</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>The Royal Bank of Scotland Group PLC</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-16-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>330,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>338,363</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Wachovia Bank NA (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.850</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-01-37</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>390,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>376,920</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Wachovia Bank NA, Series Bank Note (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.600</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-38</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>325,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>347,728</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Wells Fargo Bank NA (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-16-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>450,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>489,119</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Westpac Banking Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-19-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>565,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>573,779</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Consumer Finance 3.58%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>American Express Credit Corp., Series C (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.300</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-20-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>670,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>763,618</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Capital One Financial Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-15-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,123,153</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Capital One Financial Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.150</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-01-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>730,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>778,100</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Discover Bank/Greenwood DE</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>215,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>220,903</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Discover Financial Services</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>585,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>717,113</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Ford Motor Credit Company LLC (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>140,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>149,225</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Ford Motor Credit Company LLC</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-01-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>90,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>93,017</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Nelnet, Inc.,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(7.400% to 09-29-2011, then 3 month LIBOR</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>+3.376%) (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.400</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-29-36</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>715,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>615,905</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Nissan Motor Acceptance Corp. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-30-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,009,667</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>SLM Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.450</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>395,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>394,689</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Diversified Financial Services 11.08%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>American Honda Finance Corp. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-01-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>655,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>771,310</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Astoria Depositor Corp., Series B (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.144</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-21</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>980,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bank of America Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-01-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>340,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>343,114</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bear Stearns Companies LLC (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-01-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,153,617</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Beaver Valley Funding (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>598,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>658,207</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bosphorus Financial Services, Ltd. (P)(S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.050</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>250,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>244,362</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Citigroup, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-12-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>810,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>873,834</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Citigroup, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-21-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,935,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2,010,569</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Citigroup, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.850</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-11-34</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>300,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>277,232</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CME Group, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,105,484</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>ERAC USA Finance Company (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-15-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>465,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>519,342</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>ESI Tractebel Acquisition Corp., Series B (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.990</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-30-11</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>546,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>548,730</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>General Electric Capital Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-07-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>335,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>362,107</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>GTP Towers Issuer LLC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.112</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>470,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>498,200</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD style="TEXT-INDENT: 0px" width="4%"></TD>
     <TD width="48%"></TD>
     <TD width="48%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=sans-serif>10</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD></TR></TABLE><BR>
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<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
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     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Maturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Diversified Financial Services (continued)</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
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<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Harley-Davidson Funding Corp. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;<FONT size=1 face=sans-serif>6.800%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$300,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$305,936</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Harley-Davidson Funding Corp. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>290,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>297,151</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Hyundai Capital Services, Inc. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-05-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>430,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>462,755</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>JPMorgan Chase &amp; Company (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>765,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>824,844</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>JPMorgan Chase &amp; Company (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.650</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>590,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>628,189</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>JPMorgan Chase &amp; Company, Series 1,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(7.900% to 04-30-2018, then 3 month LIBOR</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>+ 3.47%) (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.900</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-29-49</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>655,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>687,914</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>LBI Escrow Corp. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-01-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>100,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>103,625</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Merrill Lynch &amp; Company, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-14-38</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>495,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>544,826</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Merrill Lynch &amp; Company, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.150</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-25-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,082,114</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Nationstar Mortgage/Nationstar</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Capital Corp. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-01-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>485,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>468,025</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>PNC Funding Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-21-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>695,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>718,816</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>State Street Capital Trust IV (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.257</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-37</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>905,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>697,588</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Teco Finance, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.572</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-01-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>298,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>330,672</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>USB Realty Corp.,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(6.091% to 01-15-2012, then 3 month LIBOR</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>+ 1.147%) (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.091</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-29-49</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>800,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>674,000</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Insurance 6.59%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Aflac, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>335,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>410,428</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Aflac, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.900</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-17-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>230,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>248,754</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CNA Financial Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.350</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>320,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>341,708</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CNA Financial Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>825,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>852,921</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Horace Mann Educators Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.850</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>395,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>405,541</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Liberty Mutual Group, Inc. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.800</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-37</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>705,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>652,125</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Liberty Mutual Group, Inc. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-36</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>885,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>881,828</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Liberty Mutual Group, Inc. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.300</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>750,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>820,904</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Lincoln National Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-01-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>695,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>866,965</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Lincoln National Corp.,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(6.050% until 04-20-2017, then 3 month</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>LIBOR + 2.04%) (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.050</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-20-67</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>250,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>217,500</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Massachusetts Mutual Life Insurance</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Company (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>210,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>280,620</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>MetLife, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>335,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>381,007</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>New York Life Insurance Company (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>540,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>614,832</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Progressive Corp.,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(6.700% to 06-15-2017, then 3 month LIBOR</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>+2.018%) (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.700</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-37</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>330,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>327,017</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Prudential Financial, Inc., MTN (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>210,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>247,348</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>QBE Insurance Group, Ltd. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-14-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>486,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>591,931</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Teachers Insurance &amp; Annuity Association of</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
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<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>America (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.850</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-16-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>605,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>682,177</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Unum Group</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-30-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>390,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>428,459</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>UnumProvident Finance Company PLC (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.850</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>605,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>652,686</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>W.R. Berkley Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.600</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>365,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>378,484</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Willis North America, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-29-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>495,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>524,297</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="72%"></TD>
     <TD width="24%"></TD>
     <TD width="4%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=right><FONT size=2 face=sans-serif>11</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="43%"></TD>
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     <TD width="10%"></TD>
     <TD width="12%"></TD>
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<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=center></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Maturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Real Estate Investment Trusts 5.36%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
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<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>AMB Property LP (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;<FONT size=1 face=sans-serif>6.625%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-01-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$490,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$523,537</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Biomed Realty LP (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>135,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>136,672</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Boston Properties LP</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>265,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>281,021</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Brandywine Operating Partnership LP (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>345,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>379,275</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Developers Diversified Realty Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-01-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>465,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>482,966</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Dexus Property Group (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>495,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>546,986</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Duke Realty LP</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>855,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>897,392</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Health Care REIT, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.200</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>505,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>542,588</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Healthcare Realty Trust, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-11</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>175,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>185,252</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Healthcare Realty Trust, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-17-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>540,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>565,463</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>HRPT Properties Trust (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.650</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>480,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>489,545</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Mack-Cali Realty LP (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>330,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>387,025</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>ProLogis (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>975,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>966,034</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>ProLogis (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>385,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>384,981</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Reckson Operating Partnership LP (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>200,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>207,060</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Simon Property Group LP (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.350</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-01-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>345,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>447,062</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Vornado Realty Trust</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-01-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>755,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>754,993</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>WEA Finance LLC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-02-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>290,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>324,881</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>WEA Finance LLC (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.400</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-01-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>275,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>293,985</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Health Care 4.48%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>7,345,633</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Health Care Equipment &amp; Supplies 1.15%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Covidien International Finance SA (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.450</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-15-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>930,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,014,856</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Hospira, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.050</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-30-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>485,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>532,028</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Inverness Medical Innovations, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-01-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>335,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>329,975</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Health Care Providers &amp; Services 2.40%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>BioScrip, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-01-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>195,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>199,875</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CIGNA Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-15-11</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>640,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>681,319</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Express Scripts, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>935,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,048,595</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Medco Health Solutions, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>850,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>971,684</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Sun Healthcare Group, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,035,000</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Life Sciences Tools &amp; Services 0.40%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Life Technologies Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-01-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>385,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>405,082</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Life Technologies Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.400</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-01-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>245,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>251,515</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Pharmaceuticals 0.53%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Catalent Pharma Solutions, Inc., PIK</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>425,756</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>432,142</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Watson Pharmaceuticals, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>415,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>443,562</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Industrials 9.27%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>15,205,300</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Aerospace &amp; Defense 0.54%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bombardier, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>240,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>255,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Colt Defense LLC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>250,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>237,500</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Embraer Overseas, Ltd. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>380,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>387,600</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Airlines 2.74%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Continental Airlines, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.307</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-02-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>343,309</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>339,018</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Continental Airlines, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.545</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-02-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>220,781</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>225,197</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Continental Airlines, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.983</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-19-22</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>554,994</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>549,444</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Continental Airlines, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.648</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-15-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>163,409</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>165,861</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Delta Air Lines, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>360,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>381,150</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD style="TEXT-INDENT: 0px" width="4%"></TD>
     <TD width="48%"></TD>
     <TD width="48%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=sans-serif>12</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="43%"></TD>
     <TD width="12%"></TD>
     <TD width="10%"></TD>
     <TD width="10%"></TD>
     <TD width="12%"></TD>
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<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=center></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Maturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Airlines (continued)</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
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<TR>
     <TD colSpan=6>
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</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Delta Air Lines, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;<FONT size=1 face=sans-serif>6.821%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-10-22</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$678,371</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$693,635</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Delta Air Lines, Inc., Class G-1</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.718</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-02-23</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>514,046</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>493,484</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Northwest Airlines, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.027</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-01-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>436,769</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>424,212</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Northwest Airlines, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.264</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-20-21</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>539,134</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>512,177</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>United Air Lines, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.400</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-01-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>195,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>211,575</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>United Air Lines, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>455,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>498,225</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Building Materials 0.58%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Voto-Votorantim Overseas Trading Operations</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>NV (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-25-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>450,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>454,500</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Voto-Votorantim, Ltd. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-05-21</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>490,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>493,675</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Building Products 0.18%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Masco Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>285,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>292,359</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Commercial Services &amp; Supplies 0.12%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>ACCO Brands Corp. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>80,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>88,600</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Garda World Security Corp. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>100,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>103,625</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Electrical Equipment 0.13%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Coleman Cable, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>205,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>209,356</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Industrial Conglomerates 0.95%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Hutchison Whampoa International, Ltd. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-13-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>365,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>403,056</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Hutchison Whampoa International, Ltd. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-11-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>615,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>643,877</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Textron, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.600</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-01-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>505,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>519,078</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Machinery 1.05%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Case New Holland, Inc. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-01-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>335,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>352,588</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Ingersoll-Rand Global Holding Company,</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>&nbsp;Ltd. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>540,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>595,362</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Manitowoc, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-01-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>500,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>500,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Terex Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>250,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>280,625</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Marine 0.62%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Navios Maritime Holdings, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,025,000</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Road &amp; Rail 1.32%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CSX Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.300</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,079,763</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Kansas City Southern de Mexico SA de CV</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>140,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>143,220</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Kansas City Southern de Mexico SA de CV (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-01-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>335,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>349,238</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>RailAmerica, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-01-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>239,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>257,523</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Western Express, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>12.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>340,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>333,200</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Trading Companies &amp; Distributors 0.76%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>GATX Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>950,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,114,452</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>United Rentals North America, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>125,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>140,625</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Transportation Infrastructure 0.28%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CMA CGM SA (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-01-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>700,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>451,500</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Information Technology 1.64%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>2,684,184</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>&nbsp; </TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><B><FONT size=1 face=sans-serif>Electronic Equipment, Instruments &amp; Components 1.22%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Amphenol Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>540,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>561,376</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Freescale Semiconductor, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>985,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Tyco Electronics Group SA</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-01-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>415,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>447,917</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="72%"></TD>
     <TD width="24%" align=right></TD>
     <TD width="4%" align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=right><FONT size=2 face=sans-serif>13</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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     <TD width="43%"></TD>
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<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=center></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Maturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Internet Software &amp; Services 0.10%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Equinix, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;<FONT size=1 face=sans-serif>8.125%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-01-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$165,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$171,806</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>IT Services 0.32%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Fiserv, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.800</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-20-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>460,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>518,085</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Materials 7.96%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$13,050,495</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Chemicals 1.60%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>American Pacific Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-01-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>590,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>585,575</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CF Industries, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>55,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>57,888</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CF Industries, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>55,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>57,338</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Incitec Pivot Finance LLC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-10-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>345,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>359,511</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Mosaic Company (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-01-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>480,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>527,023</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>RPM International, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>325,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>343,064</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Solutia, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>280,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>289,100</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Sterling Chemicals, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-01-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>400,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>404,000</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Construction Materials 0.06%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Severstal Columbus LLC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>100,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>105,125</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Containers &amp; Packaging 1.41%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Ball Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>345,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>352,763</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bway Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>315,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>344,925</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Graphic Packaging International, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>115,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>123,625</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Smurfit-Stone Container Enterprises, Inc. (H)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-01-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,015,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Smurfit-Stone Container Enterprises, Inc. (H)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>245,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>245,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Solo Cup Company</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-01-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>85,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>90,525</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>U.S. Corrugated, Inc.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-12-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>160,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>140,800</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Metals &amp; Mining 3.05%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Allegheny Technologies, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>280,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>334,288</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>ArcelorMittal (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.850</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>540,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>703,226</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CII Carbon LLC (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>11.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,015,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,037,838</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Commercial Metals Company (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.350</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>310,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>329,473</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Rio Tinto Alcan, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-15-33</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>415,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>440,497</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Rio Tinto Finance USA, Ltd. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.950</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>365,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>442,230</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Teck Resources, Ltd.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,100,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,369,500</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Vale Overseas, Ltd.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-10-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>320,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>335,749</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Paper &amp; Forest Products 1.84%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Boise Paper Holdings LLC (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-01-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>70,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>72,100</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>International Paper Company (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>690,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>877,674</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>International Paper Company (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.950</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>225,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>266,980</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>NewPage Corp.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>11.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-31-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>135,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>138,713</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>PE Paper Escrow GmbH (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>12.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-01-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>100,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>114,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Verso Paper Holdings LLC, Series B (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-01-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,020,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Westvaco Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.950</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-31</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>475,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>526,965</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp; </TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Telecommunication Services 4.41%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>7,222,844</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><B><FONT size=1 face=sans-serif>Diversified Telecommunication Services 2.66%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Axtel SAB de CV (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-22-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>160,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>161,600</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>BellSouth Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.300</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>725,768</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>769,301</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Intelsat Jackson Holdings, Ltd.</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>11.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>365,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>394,200</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>New Communications Holdings, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>305,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>314,150</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD style="TEXT-INDENT: 0px" width="4%"></TD>
     <TD width="48%"></TD>
     <TD width="48%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=sans-serif>14</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
<!--$$/page=-->
<A name="page_11"></A><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="43%"></TD>
     <TD width="12%"></TD>
     <TD width="10%"></TD>
     <TD width="10%"></TD>
     <TD width="12%"></TD>
     <TD width="12%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=center></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Maturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><B><FONT size=1 face=sans-serif>Diversified Telecommunication Services (continued)</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Qwest Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.375%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$330,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$376,200</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Qwest Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-01-11</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>445,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>472,256</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Telecom Italia Capital SA (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.175</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-18-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,110,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,192,466</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>West Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>11.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>630,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>675,675</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Wireless Telecommunication Services 1.75%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>America Movil SAB de CV (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-30-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>440,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>443,021</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Digicel Group, Ltd. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,080,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,080,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>NII Capital Corp. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>230,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>255,300</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>SBA Telecommunications, Inc. (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>135,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>142,425</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Sprint Capital Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.900</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>946,250</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Utilities 8.25%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>13,526,925</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Electric Utilities 5.11%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Allegheny Energy Supply Company LLC (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>290,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>287,679</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Aquila, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>11.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-01-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>405,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>475,469</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>BVPS II Funding Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.890</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>621,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>688,593</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Commonwealth Edison Company</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.150</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-15-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>230,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>257,191</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Commonwealth Edison Company (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.800</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>705,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>775,804</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Duke Energy Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.300</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-01-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>340,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>381,677</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Exelon Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.900</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>985,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,039,972</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>FirstEnergy Solutions Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.800</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>370,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>382,882</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>FPL Energy National Wind LLC (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.608</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-10-24</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>283,388</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>286,072</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>ITC Holdings Corp. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.875</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-30-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>175,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>184,163</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>ITC Holdings Corp. (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>415,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>422,422</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Monongahela Power Company (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.950</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-15-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>635,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>744,424</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Pepco Holdings, Inc. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.450</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>565,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>615,047</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>PNPP II Funding Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.120</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-30-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>344,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>372,889</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Texas Competitive Electric Holdings Company</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>&nbsp;LLC, Series A (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-01-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>750,000</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>TXU Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.460</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-01-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>294,351</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>234,936</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Waterford 3 Funding Corp. (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.090</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-02-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>470,896</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>484,896</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Gas Utilities 0.32%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>DCP Midstream LLC (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.750</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>405,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>527,362</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><B><FONT size=1 face=sans-serif>Independent Power Producers &amp; Energy Traders 0.66%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>AES Eastern Energy LP, Series 199-A (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-02-17</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>884,136</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>908,539</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Listrindo Capital BV (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-29-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>155,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>165,921</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Multi-Utilities 1.18%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>DTE Energy Company (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-15-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>910,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,050,204</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Sempra Energy (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.900</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>345,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>410,879</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Sempra Energy (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>415,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>471,840</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Water Utilities 0.98%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Indiantown Cogeneration LP, Series A&#150;9 (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.260</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-15-10</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>110,703</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>112,982</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Midwest Generation LLC, Series B (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.560</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-02-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>594,046</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>605,927</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Oncor Electric Delivery Company LLC (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-01-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>820,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>889,155</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="60%"></TD>
     <TD width="36%"></TD>
     <TD width="4%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=right><FONT size=2 face=sans-serif>15</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="43%"></TD>
     <TD width="12%" align=right></TD>
     <TD width="10%"></TD>
     <TD width="10%"></TD>
     <TD width="12%" align=right></TD>
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<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=center></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Maturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Convertible Bonds 0.21%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$346,294</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=6 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>(Cost $341,557)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Financials 0.21%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>346,294</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Corporate Office Properties LP (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.250%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-30</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$345,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>346,294</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>&nbsp; </TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Shares</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Preferred Stocks 2.97%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$4,877,630</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=6 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>(Cost $5,106,106)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Consumer Staples 0.55%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>905,860</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Food &amp; Staples Retailing 0.55%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Ocean Spray Cranberries, Inc., 6.250%,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series A (S)(Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>12,500</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>905,860</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Financials 1.82%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>2,987,370</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Diversified Financial Services 0.43%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bank of America Corp., 8.625% (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>26,575</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>699,720</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Real Estate Investment Trusts 1.39%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Apartment Investment &amp; Management</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Company, Series T, 8.000% (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>55,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,330,450</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Public Storage, Inc., Depositary Shares, Series</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>W, 6.500% (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>40,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>957,200</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Telecommunication Services 0.60%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>984,400</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Wireless Telecommunication Services 0.60%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Telephone &amp; Data Systems, Inc., 7.600%,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series A (Z)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>40,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>984,400</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=center></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Maturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Term Loans (M) 0.60%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$985,111</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=6 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>(Cost $1,053,316)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Consumer Discretionary 0.60%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>985,111</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Hotels, Restaurants &amp; Leisure 0.60%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>East Valley Tourist Development Authority</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.000%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-06-12</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$513,432</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>436,417</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Greektown Holdings LLC</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-30-10</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>492,377</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>497,300</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Greektown Holdings LLC (T)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-30-10</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>51,394</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>51,394</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6></TD></TR>
<TR>
     <TD colSpan=6>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><B><FONT size=1 face=sans-serif>U.S. Government &amp; Agency Obligations 27.26%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$44,697,811</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=6 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>(Cost $43,943,203)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>U.S. Government 15.70%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>25,746,277</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>U.S. Treasury Bonds,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Bond</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.375%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$555,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>541,125</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Bond</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2,530,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2,517,350</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>U.S. Treasury Notes,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Note</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-15-20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>695,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>692,937</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Note</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,025,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2,961,902</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Note</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.625</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-31-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>640,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>649,400</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Note</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-31-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4,310,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4,331,550</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Note</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.375</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-28-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8,555,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8,560,390</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Note</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.250</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-31-15</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,880,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,872,950</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Note</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.125</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-30-14</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,640,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,618,673</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD style="TEXT-INDENT: 0px" width="4%"></TD>
     <TD width="48%"></TD>
     <TD width="48%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=sans-serif>16</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
<!--$$/page=-->
<A name="page_13"></A><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="43%"></TD>
     <TD width="12%" align=right></TD>
     <TD width="10%"></TD>
     <TD width="10%"></TD>
     <TD width="12%"></TD>
     <TD width="12%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=center></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Malturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>U.S. Government Agency 11.56%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$18,951,534</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Federal Home Loan Mortgage Corp.,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>30 Yr Pass Thru Ctf</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.500%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-01-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$3,697,372</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,738,968</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Federal National Mortgage Association,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>15 Yr Pass Thru Ctf</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-24</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,559,477</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,632,197</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>30 Yr Pass Thru Ctf</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>02-01-36</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2,930,859</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,096,750</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>30 Yr Pass Thru Ctf</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-37</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,613,019</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,699,529</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>30 Yr Pass Thru Ctf</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-38</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,197,125</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,368,596</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>30 Yr Pass Thru Ctf</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-01-24</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,438,290</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,467,674</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Note</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.800</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-15-13</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,015,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,013,962</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Government National Mortgage Association,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>30 Yr Pass Thru Ctf</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-15-38</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>878,215</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>933,858</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6></TD></TR>
<TR>
     <TD colSpan=6>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><B><FONT size=1 face=sans-serif>Collateralized Mortgage Obligations 9.43%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$15,458,939</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=6 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>(Cost $20,715,176)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><B><FONT size=1 face=sans-serif>Collateralized Mortgage Obligations 9.43%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>15,458,939</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>American Home Mortgage Assets,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2006-6, Class XP IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.706%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-25-46</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$10,680,269</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>478,168</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2007-5, Class XP IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3.015</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-25-47</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7,888,114</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>418,859</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>American Tower Trust,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2007-1A, Class D (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.957</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-15-37</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>865,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>912,091</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Banc of America Funding Corp.,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2006-B, Class 6A1 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.827</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-20-36</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>757,917</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>547,066</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bear Stearns Adjustable Rate Mortgage Trust,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-1, Class B2 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3.770</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-25-35</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>797,778</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>96,591</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bear Stearns Alt-A Trust,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-3, Class B2 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.730</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-25-35</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>548,235</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>29,209</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bear Stearns Commercial</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Mortgage Securities, Inc.,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2006-PW14, Class D (P)(S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.412</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-11-38</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>655,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>235,854</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Citigroup Mortgage Loan Trust, Inc.,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-10, Class 1A5A (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.696</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-25-35</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>586,322</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>402,158</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-5, Class 2A3</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-25-35</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>319,636</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>311,795</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Citigroup/Deutsche Bank Commercial</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Mortgage Trust,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-CD1, Class C (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.399</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-15-44</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>295,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>193,886</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Countrywide Alternative Loan Trust,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2006-OA12, Class X IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3.033</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-20-46</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>14,905,587</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>598,745</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Federal National Mortgage Association,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2009-47, Class EI IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-25-19</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,407,124</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>169,058</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 398, Class C3 IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-25-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,995,705</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>512,148</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 401, Class C2 IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-25-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,290,174</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>298,156</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 402, Class 3, IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-25-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,295,923</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>311,280</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 402, Class 4 IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-25-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2,329,402</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>531,991</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 402, Class 7 IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-25-39</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2,208,573</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>530,815</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>First Horizon Alternative Mortgage Securities,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2004-AA5, Class B1 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.516</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-25-34</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>409,603</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>33,858</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>GSR Mortgage Loan Trust,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2006-4F, Class 6A1</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-25-36</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,004,035</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2,646,837</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2004-9, Class B1 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3.904</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-25-34</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>805,293</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>317,337</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Harborview Mortgage Loan Trust,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-11, Class X IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-19-45</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,735,358</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>140,942</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-8, Class 1X IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.440</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-19-35</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6,241,047</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>243,791</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2007-3, Class ES IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>0.350</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-19-47</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>16,789,556</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>115,848</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2007-4, Class ES IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>0.350</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>07-19-47</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>18,492,607</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>105,963</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2007-6, Class ES IO (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>0.342</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-19-37</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>13,339,367</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>88,307</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="72%"></TD>
     <TD width="24%" align=right></TD>
     <TD style="TEXT-INDENT: 0px" width="4%" align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=2 face=sans-serif>17</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
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     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Maturity</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Rate</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>date</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Par value</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Value</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><B><FONT size=1 face=sans-serif>Collateralized Mortgage Obligations (continued)</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Harborview Net Interest Margin Corp.,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2006-9A, Class N2 (P)(S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.350%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-19-36</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$323,137</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>IndyMac Index Mortgage Loan Trust,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2004-AR13, Class B1 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.296</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>01-25-35</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>324,141</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$32,270</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-AR18, Class 1X IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.476</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-25-36</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>12,633,356</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>434,587</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-AR18, Class 2X IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.202</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-25-36</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>12,207,253</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>434,578</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-AR5, Class B1 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.841</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-25-35</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>433,114</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>17,779</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>JPMorgan Chase Commercial Mortgage</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Securities Corp.,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-LDP4, Class B (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.129</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10-15-42</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2,035,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,532,594</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Merrill Lynch Mortgage Investors Trust,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Ser 2006-AF1, Class MF1 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.274</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-25-36</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,180,857</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>72,223</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>MLCC Mortgage Investors, Inc.,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2007-3, Class M1 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.907</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-25-37</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>409,789</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>175,232</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2007-3, Class M2 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.907</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-25-37</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>151,233</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>61,670</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2007-3, Class M3 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.907</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>09-25-37</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>102,449</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>38,466</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Morgan Stanley Capital I,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-HQ7, Class A4 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.378</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>11-14-42</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>840,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>880,275</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2006-IQ12, Class E (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.538</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-15-43</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>640,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>109,907</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Provident Funding Mortgage Loan Trust,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-1, Class B1 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3.010</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-25-35</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>404,602</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>114,265</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Residential Accredit Loans, Inc.,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-QA12, Class NB5 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.938</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>12-25-35</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>29,561</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>20,628</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Washington Mutual, Inc.,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-AR4, Class B1 (P)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.714</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-25-35</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,503,920</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>343,266</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2007-0A5, Class 2XPP IO</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.144</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-25-47</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>43,372,226</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>659,418</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2005-6, Class 1CB</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6.500</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-25-35</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>372,316</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>261,028</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6></TD></TR>
<TR>
     <TD colSpan=6>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Asset Backed Securities 1.22%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$2,008,117</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=6 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>(Cost $2,143,114)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Asset Backed Securities 1.22%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>2,008,117</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>ContiMortgage Home Equity Loan Trust,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 1995-2, Class A&#150;5</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.100%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>08-15-25</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$40,655</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>35,890</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>DB Master Finance LLC,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2006-1, Class-M1 (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.285</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>06-20-31</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>340,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>312,188</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Dominos Pizza Master Issuer LLC,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2007-1, Class M1 (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.629</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>04-25-37</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>855,657</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Hertz Vehicle Financing LLC,</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Series 2009-2A, Class A2 (S)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>5.290</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>03-25-16</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>760,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>804,382</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR>
     <TD colSpan=6>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Short-Term Investments 1.04%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$1,699,994</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=6 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>(Cost $1,699,994)</FONT>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Short-Term Securities 1.04%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>1,699,994</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Federal Home Loan Bank Discount Note</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>0.060%*</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>05-03-10</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$1,700,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,699,994</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><B><FONT size=1 face=sans-serif>Total investments (Cost $236,722,737) 146.33%</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$239,940,504</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><B><FONT size=1 face=sans-serif>Other assets and liabilities, net (46.33%)</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>($75,970,074)</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total net assets 100.00%</FONT></B>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$163,970,430</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=6 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR></TABLE><BR>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>The percentage shown for each investment category is the total value of that category as a percentage of the net assets of the Fund.</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD style="TEXT-INDENT: 0px" width="4%"></TD>
     <TD width="48%"></TD>
     <TD width="48%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=sans-serif>18</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD></TR></TABLE><BR>
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<A name="page_15"></A><BR>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Notes to Schedule of Investments</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>IO Interest Only Security &#151; Interest Tranche of Stripped Mortgage Pool </FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>LIBOR London Interbank Offered Rate </FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>MTN Medium-Term Note </FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>PIK Paid In Kind</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>(H) Defaulted security. Currently, the issuer is in default with respect to interest payments. </FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>(M) Term loans are variable rate obligations. The coupon rate shown represents the rate at period end unless the investment is unsettled.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>(P) Variable rate obligation. The coupon rate shown represents the rate at period end.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>(S) These securities are exempt from registration under Rule 144A of the Securities Act of 1933. Such securities may be resold, normally to qualified institutional buyers, in transactions exempt from registration. Rule 144A securities amounted to $50,095,246 or 30.53% of the Fund&#146;s net assets as of April 30, 2010.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>(T) All or a portion of this position represents unsettled loan commitment. The coupon rate will be determined at time of settlement.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>(Z) All or a portion of this security is segregated as collateral pursuant to the Committed Facility Agreement. Total collateral value at April 30, 2010 was $131,643,987.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>&#134; At April 30, 2010, the aggregate cost of investment securities for federal income tax purposes was $237,404,662. Net unrealized appreciation aggregated $2,535,842, of which $15,348,893 related to appreciated investment securities and $12,813,051 related to depreciated investment securities.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>* Yield represents either the annualized yield at the date of purchase, the stated coupon rate or, for floating rate securities, the rate at period end.</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="72%"></TD>
     <TD width="24%" align=right></TD>
     <TD style="TEXT-INDENT: 0px" width="4%" align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=2 face=sans-serif>19</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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<A name="page_16"></A><BR>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif><FONT size=2 face=sans-serif>F I N A N C I A L&nbsp;&nbsp; S T A T E M E N T S</FONT></FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=7 face=serif>Financial statements</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=4 face=sans-serif>Statement of assets and liabilities </FONT><FONT size=2 face=sans-serif>4-30-10 (unaudited)</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>This Statement of Assets and Liabilities is the Fund&#146;s balance sheet. It shows the value of what the Fund owns, is due and owes. You&#146;ll also find the net asset value for each common share.</FONT></B></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="60%"></TD>
     <TD width="40%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Assets</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Investments, at value (Cost $236,722,737)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$239,940,504</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Cash</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>41,493</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Cash held at broker for futures&nbsp;contracts</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>50,400</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Receivable for investments&nbsp;sold</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2,208,084</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Dividends and interest&nbsp;receivable</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>4,075,559</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Prepaid Committed Facility Agreement arrangement fees (Note&nbsp;8)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>39,462</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Other assets</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>25,474</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total&nbsp;assets</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>246,380,976</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Liabilities</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Payable for investments&nbsp;purchased</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,727,097</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Committed facility agreement payable (Note&nbsp;8)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>80,000,000</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Unrealized depreciation of swap contracts (Note&nbsp;3)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>625,279</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Payable for futures variation&nbsp;margin (Note 3)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>11,203</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Payable to&nbsp;affiliates</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Accounting and legal services&nbsp;fees</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,218</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Other liabilities and accrued&nbsp;expenses</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>43,749</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total&nbsp;liabilities</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>82,410,546</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>
<P>&nbsp;</P>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Net&nbsp;assets</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Capital paid-in</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$182,509,417</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Undistributed net investment&nbsp;income</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>724,238</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Accumulated net realized loss on investments, futures contracts and</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>swap&nbsp;contracts</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(21,826,161)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net unrealized appreciation on investments, futures contracts and</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>swap&nbsp;contracts</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2,562,936</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Net&nbsp;assets</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$163,970,430</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Net asset value per&nbsp;share</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Based on 11,521,293 shares of beneficial interest outstanding &#151; unlimited</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>number of shares authorized with no par&nbsp;value</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$14.23</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD style="TEXT-INDENT: 0px" width="4%"></TD>
     <TD width="48%"></TD>
     <TD width="48%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=sans-serif>20</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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<A name="page_17"></A><BR>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif><FONT size=2 face=sans-serif>F I N A N C I A L&nbsp;&nbsp; S T A T E M E N T S</FONT> </FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=4 face=sans-serif>Statement of operations </FONT><FONT size=2 face=sans-serif>For the six-month period ended 4-30-10</FONT><BR>
<FONT size=2 face=sans-serif>(unaudited)</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>This Statement of Operations summarizes the Fund&#146;s investment income earned and expenses incurred in operating the Fund. It also shows net gains (losses) for the period stated.</FONT></B></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="60%"></TD>
     <TD width="40%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Investment&nbsp;income</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Interest</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$7,495,116</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Dividends</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>199,405</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Less foreign taxes&nbsp;withheld</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(1,253)</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total investment&nbsp;income</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>7,693,268</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Expenses</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Investment management fees (Note&nbsp;5)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>627,943</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Accounting and legal services fees (Note&nbsp;5)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>13,044</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Transfer agent&nbsp;fees</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>58,068</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Trustees&#146; fees (Note&nbsp;5)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>26,616</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Printing and postage&nbsp;fees</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>28,749</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Professional&nbsp;fees</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>133,799</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Custodian&nbsp;fees</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>17,539</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Interest expense (Note&nbsp;8)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>527,871</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Stock exchange listing&nbsp;fees</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>12,035</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Other</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>19,306</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total&nbsp;expenses</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>1,464,970</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Net investment&nbsp;income</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>6,228,298</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Realized and unrealized gain&nbsp;(loss)</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Net realized loss&nbsp;on</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Investments</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(3,172,021)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Futures contracts (Note&nbsp;3)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(46,259)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Swap contracts (Note&nbsp;3)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(642,856)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>(3,861,136)</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Change in net unrealized appreciation (depreciation)&nbsp;of</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Investments</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>12,950,084</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Futures contracts (Note&nbsp;3)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(15,460)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Swap contracts (Note&nbsp;3)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>594,179</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>13,528,803</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Net realized and unrealized&nbsp;gain</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>9,667,667</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Increase in net assets from&nbsp;operations</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$15,895,965</FONT></B>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="72%"></TD>
     <TD width="24%" align=right></TD>
     <TD width="4%" align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=right><FONT size=2 face=sans-serif>21</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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<A name="page_18"></A><BR>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif><FONT size=2 face=sans-serif>F I N A N C I A L&nbsp;&nbsp; S T A T E M E N T S</FONT> <BR>
<BR>
</FONT><FONT size=4 face=sans-serif>Statements of changes in net assets</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>These Statements of Changes in Net Assets show how the value of the Fund&#146;s net assets has changed during the last two periods. The difference reflects earnings less expenses, any investment gains and losses, distributions, if any, paid to shareholders and the net of Fund share transactions.</FONT></B></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="60%"></TD>
     <TD width="20%"></TD>
     <TD width="20%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>For the</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>six-month</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>period ended</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Year</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>4-30-10</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>ended</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>(unaudited)</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>10-31-09</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=3></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Increase (decrease) in net&nbsp;assets</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=3 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>From&nbsp;operations</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net investment&nbsp;income</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$6,228,298</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$13,454,313</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net realized&nbsp;loss</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(3,861,136)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(6,980,423)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Change in net unrealized appreciation&nbsp;(depreciation)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>13,528,803</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>37,934,387</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Increase in net assets resulting from&nbsp;operations</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>15,895,965</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>44,408,277</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Distributions to&nbsp;shareholders</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>From net investment&nbsp;income</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(6,514,993)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(12,871,827)</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>From Fund share transactions (Note&nbsp;6)</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>530,596</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>1,059,251</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total&nbsp;increase</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>9,911,568</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>32,595,701</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=3></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Net&nbsp;assets</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=3 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Beginning of&nbsp;period</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>154,058,862</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>121,463,161</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>End of&nbsp;period</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$163,970,430</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$154,058,862</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Undistributed net investment&nbsp;income</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$724,238</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$1,010,933</FONT></B>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="4%"></TD>
     <TD width="48%"></TD>
     <TD width="48%"></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 0px" noWrap align=left><FONT size=2 face=sans-serif>22</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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<A name="page_19"></A><BR>
<P style="TEXT-ALIGN: left"><FONT size=4 face=sans-serif>Statement of cash flows</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>This Statement of Cash Flows shows cash flow from operating and financing activities for the period stated.</FONT></B></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="60%"></TD>
     <TD width="40%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>For the</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>six-month</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>period ended</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>4-30-10</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>(unaudited)</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Cash flows from operating activities</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=2 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net increase in net assets from operations</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$15,895,965</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Adjustments to reconcile net increase in net assets from operations to net</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>cash used in operating activities:</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Long-term investments purchased</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(124,537,592)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Long-term investments sold</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>105,590,291</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Increase in short-term investments</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(1,406,994)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net amortization of premium (discount)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>544,516</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Increase in dividends and interest receivable</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(398,568)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Increase in payable for investments purchased</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>336,499</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Increase in receivable for investments sold</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(1,575,854)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Decrease in cash held at broker for futures contracts</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>11,700</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Decrease in other receivables and prepaid assets</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10,930</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Decrease in prepaid arrangement fees</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>24,445</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net change in unrealized (appreciation) depreciation on swap contracts</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(594,179)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Decrease in payable for futures variation margin</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(9,281)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Decrease in payable to affiliates</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(34,318)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Decrease in interest payable</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(5,285)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Decrease in other liabilities and accrued expenses</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(48,485)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net change in unrealized (appreciation) depreciation on investments</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(12,950,084)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net realized loss on investments</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>3,172,021</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Net cash used in operating activities</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>($15,974,273)</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>
<HR SIZE=1 noShade>
&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Cash flows from financing activities</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Borrowings from credit facility agreement payable</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$22,000,000</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Distributions to common shareholders net of reinvestments</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(5,984,397)</FONT>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Net decrease in cash</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$41,330</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Cash at beginning of period</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$163</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Cash at end of period</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$41,493</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>&nbsp;&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Supplemental disclosure of cash flow information</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=2>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Cash paid for interest</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>($522,586)</FONT></B>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Noncash financing activities not included herein</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>consist of reinvestment of distributions</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>530,596</FONT></B>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="72%"></TD>
     <TD width="24%" align=right></TD>
     <TD width="4%" align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=right><FONT size=2 face=sans-serif>23</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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<A name="page_20"></A><BR>
<P style="TEXT-ALIGN: left"><FONT size=7 face=serif>Financial highlights</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>The Financial Highlights show how the Fund&#146;s net asset value for a share has changed since the end of the previous period.</FONT></B></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="12%"></TD>
     <TD width="12%"></TD>
     <TD width="13%"></TD>
     <TD width="12%"></TD>
     <TD width="13%"></TD>
     <TD width="12%"></TD>
     <TD width="13%"></TD>
     <TD width="12%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>COMMON SHARES</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Period&nbsp;ended</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>4-30-10</FONT></B><SUP><FONT size=1 face=sans-serif>1 </FONT></SUP></TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>10-31-09</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>10-31-08</FONT></B><SUP><FONT size=1 face=sans-serif>2</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>12-31-07</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>12-31-06</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>12-31-05</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>12-31-04</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=8></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=2 noWrap align=left><B><FONT size=1 face=sans-serif>Per share operating&nbsp;performance</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=8 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Net asset value, beginning</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<B><FONT size=1 face=sans-serif>of&nbsp;period</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$13.42</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$10.67</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$14.53</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$15.22</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$15.30</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$16.19</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$16.53</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net investment&nbsp;income</FONT><SUP><FONT size=1 face=sans-serif>3</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>0.54</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.18</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.05</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.34</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.26</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.20</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.22</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net realized and unrealized gain</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(loss) on&nbsp;investments</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>0.84</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.70</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(3.92)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.69)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.03)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.81)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.25)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Distributions to Auction</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Preferred Shares (APS)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.15)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.42)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.38)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.25)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.12)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total from</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<B><FONT size=1 face=sans-serif>investment&nbsp;operations</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>1.38</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>3.88</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>(3.02)</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>0.23</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>0.85</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>0.14</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>0.85</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Less distributions to</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<B><FONT size=1 face=sans-serif>common&nbsp;shareholders</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>From net investment&nbsp;income</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.57)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(1.13)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.84)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.92)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(0.93)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(1.03)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(1.19)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Net asset value, end of&nbsp;period</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$14.23</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$13.42</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$10.67</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$14.53</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$15.22</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$15.30</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$16.19</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Per share market value, end</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<B><FONT size=1 face=sans-serif>of&nbsp;period</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$13.98</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$12.94</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$9.67</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$12.85</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$14.75</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$13.68</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$15.68</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total return at net asset</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<B><FONT size=1 face=sans-serif>value (%)</FONT></B><SUP><FONT size=1 face=sans-serif>4</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>10.49</FONT></B><SUP><FONT size=1 face=sans-serif>6</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>39.06</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>(21.36)</FONT></B><SUP><FONT size=1 face=sans-serif>6</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>1.97</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>6.24</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>1.36</FONT></B><SUP><FONT size=1 face=sans-serif>5</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>5.70</FONT></B><SUP><FONT size=1 face=sans-serif>5</FONT></SUP>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total return at market</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<B><FONT size=1 face=sans-serif>value (%)</FONT></B><SUP><FONT size=1 face=sans-serif>4</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>12.58</FONT></B><SUP><FONT size=1 face=sans-serif>6</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>47.95</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>(19.41)</FONT></B><SUP><FONT size=1 face=sans-serif>6</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>(6.94)</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>15.15</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>(6.42)</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>9.95</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=8></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Ratios and supplemental&nbsp;data</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=8 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net assets applicable to</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>common shares, end of period</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(in&nbsp;millions)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$164</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$154</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$121</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$165</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$172</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$172</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$180</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Ratios (as a percentage of</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>average net assets):</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Expenses (excluding</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>&nbsp;&nbsp; interest&nbsp;expense)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.20</FONT><SUP><FONT size=1 face=sans-serif>7</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.40</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.41</FONT><SUP><FONT size=1 face=sans-serif>7</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.16</FONT><SUP><FONT size=1 face=sans-serif>8</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.17</FONT><SUP><FONT size=1 face=sans-serif>8</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.16</FONT><SUP><FONT size=1 face=sans-serif>8</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.14</FONT><SUP><FONT size=1 face=sans-serif>8</FONT></SUP>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Interest expense (Note&nbsp;8)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>0.67</FONT><SUP><FONT size=1 face=sans-serif>7</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>0.85</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>0.76</FONT><SUP><FONT size=1 face=sans-serif>7</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Expenses (including</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>&nbsp;&nbsp; interest&nbsp;expense)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.87</FONT><SUP><FONT size=1 face=sans-serif>7</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.25</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>2.17</FONT><SUP><FONT size=1 face=sans-serif>7</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.16</FONT><SUP><FONT size=1 face=sans-serif>8</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.17</FONT><SUP><FONT size=1 face=sans-serif>8</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.16</FONT><SUP><FONT size=1 face=sans-serif>8</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1.14</FONT><SUP><FONT size=1 face=sans-serif>8</FONT></SUP>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Net investment&nbsp;income</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.96</FONT><B><SUP><FONT size=1 face=sans-serif>7</FONT></SUP></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>10.56</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>9.37</FONT><SUP><FONT size=1 face=sans-serif>7</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.87</FONT><SUP><FONT size=1 face=sans-serif>9</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>8.30</FONT><SUP><FONT size=1 face=sans-serif>9</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.62</FONT><SUP><FONT size=1 face=sans-serif>9</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>7.44</FONT><SUP><FONT size=1 face=sans-serif>9</FONT></SUP>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Portfolio turnover (%)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>47</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>94</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>40</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>54</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>94</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>148</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>135</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=8>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Senior&nbsp;securities</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD colSpan=8 noWrap align=left>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Total value of APS outstanding</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(in&nbsp;millions)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$90</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$90</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$90</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$90</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Involuntary liquidation</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>preference per unit</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(in&nbsp;thousands)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>25</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>25</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>25</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>25</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Average market value per unit</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(in&nbsp;thousands)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>25</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>25</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>25</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>25</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Asset coverage per&nbsp;unit</FONT><SUP><FONT size=1 face=sans-serif>10</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT><SUP><FONT size=1 face=sans-serif>11</FONT></SUP></TD>
     <TD noWrap align=right><SUP><FONT size=1 face=sans-serif></FONT></SUP><FONT size=1 face=sans-serif>$71,228</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$73,375</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$72,470</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$72,049</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Total debt outstanding end of</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>year (in millions) (Note&nbsp;8)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$80</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$58</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$58</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Asset coverage per $1,000</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>of&nbsp;APS</FONT><SUP><FONT size=1 face=sans-serif>12</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$2,851</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$2,928</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$2,928</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$3,027</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Asset coverage per $1,000</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>of&nbsp;debt</FONT><SUP><FONT size=1 face=sans-serif>13</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$3,050</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$3,656</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$3,094</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="4%"></TD>
     <TD width="48%"></TD>
     <TD width="48%"></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 0px" noWrap align=left><FONT size=2 face=sans-serif>24</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD></TR></TABLE><BR>
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<A name="page_21"></A><BR>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>1 </FONT></SUP><FONT size=1 face=sans-serif>Semiannual period from 11-1-09 to 4-30-10.&nbsp;Unaudited.</FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>2 </FONT></SUP><FONT size=1 face=sans-serif>For the ten-month period ended October 31, 2008. The Fund changed its fiscal year end from December 31 to October&nbsp;31.</FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>3 </FONT></SUP><FONT size=1 face=sans-serif>Based on the average daily shares&nbsp;outstanding.</FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>4 </FONT></SUP><FONT size=1 face=sans-serif>Total return based on net asset value reflects changes in the Fund&#146;s net asset value during each period. Total return based on market value reflects changes in market value. Each figure assumes that dividend and capital gain distributions, if any, were reinvested. These figures will differ depending upon the level of any discount from or premium to net asset value at which the Fund&#146;s shares traded during the&nbsp;period.</FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>5 </FONT></SUP><FONT size=1 face=sans-serif>Unaudited.</FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>6 </FONT></SUP><FONT size=1 face=sans-serif>Not&nbsp;annualized. </FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>7 </FONT></SUP><FONT size=1 face=sans-serif>Annualized.</FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>8 </FONT></SUP><FONT size=1 face=sans-serif>Ratios calculated on the basis of expenses relative to the average net assets of common shares. Without the exclusion of preferred shares, the annualized ratio of expenses would have been 0.76%, 0.77% and 0.77% for the periods ended 12-31-07, 12-31-06 and 12-31-05,&nbsp;respectively.</FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>9 </FONT></SUP><FONT size=1 face=sans-serif>Ratios calculated on the basis of net investment income relative to the average net assets of common shares. Without the exclusion of preferred shares, the annualized ratio of net investment income would have been 5.82%, 5.45% and 5.06% for the periods ended 12-31-07, 12-31-06 and 12-31-05,&nbsp;respectively.</FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>10 </FONT></SUP><FONT size=1 face=sans-serif>Calculated by subtracting the Fund&#146;s total liabilities from the Fund&#146;s total assets and dividing that amount by the number of APS outstanding, as of the applicable 1940 Act Evaluation Date, which may differ from the financial reporting&nbsp;date.</FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>11 </FONT></SUP><FONT size=1 face=sans-serif>In May 2008, the Fund entered into a Credit Facility Agreement with a third-party commercial bank in order to redeem the APS. The redemption of all APS was completed on June 12,&nbsp;2008.</FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>12 </FONT></SUP><FONT size=1 face=sans-serif>Asset coverage equals the total net assets plus APS divided by the APS of the Fund outstanding at period end. </FONT></P>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>13 </FONT></SUP><FONT size=1 face=sans-serif>Asset coverage equals the total net assets plus borrowings divided by the borrowing of the Fund outstanding at period end (Note&nbsp;8).</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="72%"></TD>
     <TD width="24%" align=right></TD>
     <TD style="TEXT-INDENT: 0px" width="4%" align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>See notes to financial statements</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=2 face=sans-serif>25</FONT>&nbsp;</TD></TR></TABLE><BR>
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<A name="page_22"></A><BR>
<P style="TEXT-ALIGN: left"><FONT size=7 face=serif>Notes to financial statements</FONT><BR>
<B><FONT size=2 face=sans-serif>(unaudited)</FONT></B></P>
<P style="TEXT-ALIGN: left"><B><FONT size=2 face=sans-serif>Note 1 &#151; Organization</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>John Hancock Income Securities Trust (the Fund) is a closed-end diversified management investment company registered under the Investment Company Act of 1940, as amended (the 1940&nbsp;Act).</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=2 face=sans-serif>Note 2 &#151; Significant accounting policies</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates. Events or transactions occurring after the end of the fiscal period through the date that the financial statements were issued have been evaluated in the preparation of the financial statements. The following summarizes the significant accounting policies of the Fund:</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Security valuation. </FONT></B><FONT size=2 face=serif>Investments are stated at value as of the close of the regular trading on the New York Stock Exchange (NYSE), normally at 4:00 </FONT><FONT size=1 face=serif>P</FONT><FONT size=2 face=serif>.</FONT><FONT size=1 face=serif>M</FONT><FONT size=2 face=serif>.</FONT><FONT size=2 face=serif>, Eastern Time. The Fund uses a three-tier hierarchy to prioritize the pricing assumptions, referred to as inputs, used in valuation techniques to measure fair value. Level 1 includes quoted prices in active markets for identical securities. Level 2 includes significant observable inputs. Observable inputs may include quoted prices for similar securities, interest rates, prepayment speeds and credit risk. Prices for securities valued using these techniques are received from independent pricing vendors and brokers and are based on an evaluation of the inputs described. Level 3 includes significant unobservable input
s when market prices are not readily available or reliable, including the Fund&#146;s own assumptions in determining the fair value of investments. The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The following is a summary of the values by input classification of the Fund&#146;s investments as of April 30, 2010, by major category type:</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="20%"></TD>
     <TD width="20%"></TD>
     <TD width="20%"></TD>
     <TD width="20%"></TD>
     <TD width="20%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>LEVEL 2</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>LEVEL 3</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>TOTAL MARKET</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>SIGNIFICANT</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>SIGNIFICANT</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>VALUE AT</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>LEVEL 1</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>OBSERVABLE</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>UNOBSERVABLE</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>4-30-10</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>QUOTED PRICE</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>INPUTS</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>INPUTS</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=5>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Asset Backed Securities</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$2,008,117</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$2,008,117</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Collateralized Mortgage</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Obligations</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>15,458,939</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>14,230,135</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$1,228,804</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Corporate Bonds</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>169,866,608</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>169,227,608</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>639,000</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Convertible Bonds</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>346,294</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>346,294</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Preferred Stocks</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>4,877,630</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$3,971,770</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>905,860</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Term Loans</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>985,111</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>985,111</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>U.S. Government &amp;</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Agency Obligations</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>44,697,811</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>44,697,811</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Short-Term Investments</FONT>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>1,699,994</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,699,994</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD></TR>
<TR>
     <TD>&nbsp;</TD>
     <TD colSpan=4>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total investments in</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<B><FONT size=1 face=sans-serif>securities</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$239,940,504</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$3,971,770</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$234,100,930</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$1,867,804</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Other Financial</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<B><FONT size=1 face=sans-serif>Instruments</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>(654,831)</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>(29,552)</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>(625,279)</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>&#151;</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Totals</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$239,285,673</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$3,942,218</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$233,475,651</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$1,867,804</FONT></B>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="4%"></TD>
     <TD width="96%"></TD></TR>
<TR vAlign=bottom>
     <TD style="TEXT-INDENT: 0px" noWrap align=left><FONT size=2 face=sans-serif>26</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD></TR></TABLE><BR>
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<A name="page_23"></A><BR>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The following is a reconciliation of Level 3 assets for which significant unobservable inputs where used to determine fair value:</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="20%"></TD>
     <TD width="20%"></TD>
     <TD width="20%"></TD>
     <TD width="20%"></TD>
     <TD width="20%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>COLLATERALIZED</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>ASSET BACKED</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>MORTGAGE</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>CORPORATE</FONT></B>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>SECURITIES</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>OBLIGATIONS</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>BONDS</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>TOTAL</FONT></B>&nbsp;</TD></TR>
<TR>
     <TD colSpan=5>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Balance as of 10-31-09</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$750,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$6,578,122</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$884,400</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$8,212,522</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Accrued discounts/</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>premiums</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>58</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>58</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Realized gain (loss)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,731,796</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>1,731,796</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Change in unreal-</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>ized appreciation</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>(depreciation)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(1,849,659)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>34,600</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(1,815,059)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net purchases (sales)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(2,183,831)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>470,000</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(1,713,831)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net transfers in and/out of</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;<FONT size=1 face=sans-serif>Level 3</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(750,000)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(3,047,682)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(750,000)</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(4,547,682)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Balance as of 4-30-10</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$0</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$1,228,804</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$639,000</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$1,867,804</FONT></B>&nbsp;</TD></TR></TABLE><BR>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>During the six-month period ended April 30, 2010, there were no significant transfers in/out of Level 1 and Level 2 assets.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>In order to value the securities, the Fund uses the following valuation techniques. Equity securities held by the Fund are valued at the last sale price or official closing price on the principal securities exchange on which they trade. In the event there were no sales during the day or closing prices are not available, then securities are valued using the last quoted bid or evaluated price. Foreign securities and currencies are valued in U.S. dollars, based on foreign currency exchange rates supplied by an independent pricing service. Certain securities traded only in the over-the-counter market are valued at the last bid price quoted by brokers making markets in the securities at the close of trading. Certain short-term securities are valued at amortized cost.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Other portfolio securities and assets, where market quotations are not readily available, are valued at fair value, as determined in good faith by the Fund&#146;s Pricing Committee, following procedures established by the Board of Trustees. Generally, trading in non-U.S. securities is substantially completed each day at various times prior to the close of trading on the NYSE. The values of non-U.S. securities, used in computing the net asset value of the Fund&#146;s shares, are generally determined at these times. Significant market events that affect the values of non-U.S. securities may occur after the time when the valuation of the securities is generally determined and the close of the NYSE. During significant market events, these securities will be valued at fair value, as determined in good faith, following procedures established by the Board of Trustees.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Security transactions and related investment income. </FONT></B><FONT size=2 face=serif>Investment security transactions are accounted for on a trade date plus one basis for daily net asset value calculations. However, for financial reporting purposes, investment transactions are reported on trade date. Interest income is accrued as earned. Gains and losses on securities sold are determined on the basis of identified cost and may include proceeds from litigation. Dividend income is recorded on the ex-date except for certain foreign dividends where the ex-date may have passed, which are recorded when the Fund becomes aware of the dividends. Interest income includes coupon interest and amortization/accretion of premiums/discounts on debt securities. Debt obligations may be placed in a non-accrual status and related interest income may be reduced by stopping current accruals and writing off interest receivables when the collection of all or a portion o
f interest has become doubtful.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Overdrafts. </FONT></B><FONT size=2 face=serif>Pursuant to the custodian agreement, the Fund&#146;s custodian may, in its discretion, advance funds to the Fund to make properly authorized payments. When such payments result in an overdraft, the Fund is obligated to repay the custodian for any overdraft, including any costs or expenses associated with the overdraft. The custodian has a lien, security interest or security</FONT></P>
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<TR vAlign=bottom>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=right><FONT size=2 face=sans-serif>27</FONT>&nbsp;</TD></TR></TABLE><BR>
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<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>entitlement in any Fund property, that is not segregated, to the maximum extent permitted by law to the extent of any overdraft.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Expenses. </FONT></B><FONT size=2 face=serif>The majority of expenses are directly attributable to an individual fund. Expenses that are not readily attributable to a specific fund are allocated among all funds in an equitable manner, taking into consideration, among other things, the nature and type of expense and the fund&#146;s relative assets. Expense estimates are accrued in the period to which they relate and adjustments are made when actual amounts are known.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Stripped securities. </FONT></B><FONT size=2 face=serif>Stripped mortgage backed securities are financial instruments that derive their value from other instruments so that one class receives the entire principal from the underlying mortgage assets (PO or principal only), while the other class receives the interest cash flows (IO or interest only). Both PO and IO investments represent an interest in the cash flows of an underlying stripped mortgage backed security. If the underlying mortgage assets experience greater than anticipated prepayments of principal, the Fund may fail to fully receive its initial investment in an IO security. The market value of these securities can be extremely volatile in response to changes in interest rates. In addition, these securities present additional credit risk such that the Fund may not receive all or part of its principal because the counterparty or issuer has defaulted on its obligation.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Federal income taxes. </FONT></B><FONT size=2 face=serif>The Fund intends to qualify as a regulated investment company by complying with the applicable provisions of the Internal Revenue Code and will not be subject to federal income tax on taxable income that is distributed to shareholders. Therefore, no federal income tax provision is required.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>For federal income tax purposes, the Fund has a capital loss carryforward of $17,399,381 available to offset future net realized capital gains. The following table details the capital loss carryforward available as of October 31, 2009.</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="16%"></TD>
     <TD width="17%"></TD>
     <TD width="17%"></TD>
     <TD width="17%"></TD>
     <TD width="17%"></TD>
     <TD width="14%"></TD></TR>
<TR vAlign=bottom>
     <TD colSpan=3 noWrap align=left><FONT size=1 face=sans-serif>CAPITAL LOSS CARRYFORWARD EXPIRING AT OCTOBER 31</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=center><FONT size=1 face=sans-serif>2012</FONT>&nbsp;</TD>
     <TD noWrap align=center><FONT size=1 face=sans-serif>2013</FONT>&nbsp;</TD>
     <TD noWrap align=center><FONT size=1 face=sans-serif>2014</FONT>&nbsp;</TD>
     <TD noWrap align=center><FONT size=1 face=sans-serif>2015</FONT>&nbsp;</TD>
     <TD noWrap align=center><FONT size=1 face=sans-serif>2016</FONT>&nbsp;</TD>
     <TD noWrap align=center><FONT size=1 face=sans-serif>2017</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=6 align=center>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=center><FONT size=1 face=sans-serif>$2,123,466</FONT>&nbsp;</TD>
     <TD noWrap align=center><FONT size=1 face=sans-serif>$2,443,482</FONT>&nbsp;</TD>
     <TD noWrap align=center><FONT size=1 face=sans-serif>$3,342,775</FONT>&nbsp;</TD>
     <TD noWrap align=center><FONT size=1 face=sans-serif>$1,351,797</FONT>&nbsp;</TD>
     <TD noWrap align=center><FONT size=1 face=sans-serif>$1,367,076</FONT>&nbsp;</TD>
     <TD noWrap align=center><FONT size=1 face=sans-serif>$6,770,785</FONT>&nbsp;</TD></TR></TABLE><BR>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>As of October 31, 2009, the Fund had no uncertain tax positions that would require financial statement recognition, de-recognition or disclosure. The Fund&#146;s federal tax return is subject to examination by the Internal Revenue Service for a period of three years.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Distribution of income and gains. </FONT></B><FONT size=2 face=serif>Distributions to shareholders from net investment income and net realized gains, if any, are recorded on the ex-date. The Fund generally declares and pays dividends quarterly and capital gain distributions, if any, annually.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Such distributions, on a tax basis, are determined in conformity with income tax regulations, which may differ from accounting principles generally accepted in the United States of America. Material distributions in excess of tax basis earnings and profits, if any, are reported in the Fund&#146;s financial statements as a return of capital.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Capital accounts within financial statements are adjusted for permanent book-tax differences. These adjustments have no impact on net assets or the results of operations. Temporary book-tax differences will reverse in a subsequent period. Permanent book-tax differences are primarily attributable to derivative transactions, amortization and accretion on debt securities, defaulted bonds and paydowns.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Statement of cash flows. </FONT></B><FONT size=2 face=serif>Information on financial transactions that have been settled through the receipt and disbursement of cash is presented in the Statement of Cash Flows. The cash amount shown in the Statement of Cash Flows is the amount included in the Fund&#146;s Statement of Assets and Liabilities and represents the cash on hand at its custodian and does not include any short-term investments.</FONT></P>
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<TR>
     <TD style="TEXT-INDENT: 0px" width="4%"></TD>
     <TD width="96%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=sans-serif>28</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD></TR></TABLE><BR>
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<P style="TEXT-ALIGN: left"><B><FONT size=2 face=sans-serif>Note 3 &#151; Derivative instruments</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The Fund may invest in derivatives, including future contracts and swap contracts, in order to meet its investment objectives. The Fund may use derivatives to manage against enhance gain/income, manage duration, gain exposure to certain securities markets and to manage against anticipated interest rate changes.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The use of derivatives may involve risks different from, or potentially greater than, the risks associated with investing directly in securities. Specifically, derivatives expose a Fund to the risk that the counterparty to an over-the-counter (OTC) derivatives contract will be unable or unwilling to make timely settlement payments or otherwise honor its obligations. OTC derivatives transactions typically can only be closed out with the other party to the transaction. If the counterparty defaults, the Fund will have contractual remedies, but there is no assurance that the counterparty will meet its contractual obligations or the Fund will succeed in enforcing them.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Futures. </FONT></B><FONT size=2 face=serif>A future is a contractual agreement to buy or sell a particular commodity, currency, or financial instrument at a pre-determined price in the future. Risks related to the use of futures contracts include possible illiquidity of the future markets, contract prices that can be highly volatile and imperfectly correlated to movements in hedged security values and/or interest rates and potential losses in excess of the fund&#146;s initial investment.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Futures contracts are valued at quoted daily settlement prices established by the exchange on which they trade. Upon entering into a futures contract, the Fund is required to deposit initial margin with the broker in the form of cash or securities. The amount of required margin is generally based on a percentage of the contract value; this amount is the initial margin for the trade. The margin deposit must then be maintained at the established level over the life of the contract. Futures contracts are marked to market daily and an appropriate payable or receivable for the change in value (variation margin) is recorded by the Fund.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>During the six months ended April 30, 2010, the Fund used futures contracts to manage duration of the portfolio. The following table summarizes the contracts held at April 30, 2010. The range of futures contracts notional amounts held by the Fund during the six months ended April 30, 2010 was approximately $2.7 to $7.1 million.</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="9%"></TD>
     <TD width="9%"></TD>
     <TD width="9%"></TD>
     <TD width="9%"></TD>
     <TD width="9%"></TD>
     <TD width="9%"></TD>
     <TD width="9%"></TD>
     <TD width="9%"></TD>
     <TD width="9%"></TD>
     <TD width="9%"></TD>
     <TD width="9%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>UNREALIZED</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>OPEN</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>NUMBER OF</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>APPRECIATION</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CONTRACTS</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>CONTRACTS</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>POSITION</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>EXPIRATION DATE</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>NOTIONAL VALUE</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(DEPRECIATION)</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=11>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>U.S. Treasury 30-Year</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bond Futures</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>10</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Long</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Jun-10</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$1,162,450</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$28,175</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>U.S. Treasury 5-Year</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Note Futures</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>27</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Short</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Jun-10</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$3,109,354</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(18,850)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>U.S. Treasury 10-Year</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Note Futures</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>23</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Short</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Jun-10</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$2,672,966</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(38,877)</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=11>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>($29,552)</FONT></B>&nbsp;</TD></TR></TABLE><BR>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Swaps. </FONT></B><FONT size=2 face=serif>The Fund may enter into interest rate, credit default, and other forms of swap agreements. Swap agreements are privately negotiated agreements between a Fund and counterparty to exchange cash flows, assets, foreign currencies or market-linked returns at specified intervals. Swaps are marked to market daily based upon values from third party vendors or broker quotations, and the change in value is recorded as an unrealized appreciation/depreciation of swap contracts.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Upfront payments made/received by the Fund are amortized/accreted for financial reporting purposes, with the unamortized/unaccreted portion included in the Statement of Assets and Liabilities. A termination payment by the counterparty or the Fund is recorded as realized gain or loss, as well as, the net periodic payments received or paid by a Fund.</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="96%" align=right></TD>
     <TD width="4%" align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=right><FONT size=2 face=sans-serif>29</FONT>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Entering into swap agreements involves, to varying degrees, elements of credit, market and documentation risk that may amount to values that are in excess of the amounts recognized on the Statement of Assets and Liabilities. Such risks involve the possibility that there will be no liquid market for the swap, that a counterparty may default on its obligation or delay payment under the swap terms. The counterparty may disagree or contest the terms of the swap. Market risks may also accompany the swap, including interest rate risk. The Fund may also suffer losses if it is unable to terminate or assign outstanding swaps or reduce its exposure through offsetting transactions.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Interest rate swaps. </FONT></B><FONT size=2 face=serif>Interest rate swaps represent an agreement between a Fund and counterparty to exchange cash flows based on the difference between two interest rates applied to a notional amount. The payment flows are usually netted against each other, with the difference being paid by one party to the other. The Fund settles accrued net interest receivable or payable under the swap contracts on a periodic basis.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>During the six months ended April 30, 2010, the Fund used interest rate swaps in anticipation of rising interest rates. The following table summarizes the interest rate swap contracts held as of April&nbsp;30, 2010. During the six months ended April 30, 2010, the Fund invested in interest rate swaps with total notional values as represented below.</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD>
     <TD width="6%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>USD</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>PAYMENTS</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>PAYMENTS</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>NOTIONAL</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>MADE</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>RECEIVED</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>EFFECTIVE</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>MATURITY</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>UNREALIZED</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>COUNTERPARTY</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>AMOUNT</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>BY FUND</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>BY FUND</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>DATE</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>DATE</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>DEPRECIATION</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>MARKET VALUE</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=15>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>3-month</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Bank of America</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>$29,000,000</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>4.6875%</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>LIBOR (a)</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>9-14-2007</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>9-14-2010</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>($625,279)</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>($625,279)</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=15>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD colSpan=7 noWrap align=left><FONT size=1 face=sans-serif>(a) At April 30, 2010 the 3-month LIBOR rate was 0.34656%.</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR></TABLE><BR>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Fair value of derivative instruments by risk category</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The table below summarizes the fair value of derivatives held by the Fund at April 30, 2010 by risk category:</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>FINANCIAL</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>ASSET</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>LIABILITY</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>STATEMENT OF ASSETS AND</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>INSTRUMENTS</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>DERIVATIVES</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>DERIVATIVES</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>RISK</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>LIABILITIES LOCATION</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>LOCATION</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>FAIR VALUE</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>FAIR VALUE</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=9>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Interest rate contracts</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Receivable/Payable</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Futures</FONT><SUP><FONT size=1 face=sans-serif>&#134;</FONT></SUP>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$28,175</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>($57,727)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>for futures</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net unrealized</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Interest rate swap</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>&#151;</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>(625,279)</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>depreciation on swap</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>contracts</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR>
     <TD colSpan=9>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$28,175</FONT></B>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>($683,006)</FONT></B>&nbsp;</TD></TR></TABLE><BR>
<P style="TEXT-ALIGN: left"><SUP><FONT size=1 face=sans-serif>&#134; </FONT></SUP><FONT size=1 face=sans-serif>Reflects cumulative appreciation/depreciation on futures as disclosed in Note 3. Only the year end variation margin is separately disclosed in the Statement of Assets and Liabilities.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Effect of derivative instruments on the Statement of Operations</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The table below summarizes the net realized gain (loss) included in the net increase (decrease) in net assets from operations, classified by derivative instrument and risk category, for the six month period ended April 30, 2010.</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>STATEMENT OF</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>RISK</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>OPERATIONS LOCATION</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>FUTURES CONTRACTS</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>SWAP CONTRACTS</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>TOTAL</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=9>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Interest rate</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Net realized</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>contracts</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>gain (loss)</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>($46,259)</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>($642,856)</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>($689,115)</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=9>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>($46,259)</FONT></B>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>($642,856)</FONT></B>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>($689,115)</FONT></B>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD style="TEXT-INDENT: 0px" width="4%"></TD>
     <TD width="96%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=sans-serif>30</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD></TR></TABLE><BR>
<HR align=center SIZE=2 width="100%" noShade>
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<A name="page_27"></A><BR>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The table below summarizes the net change in unrealized appreciation (depreciation) included in the net increase (decrease) in net assets from operations, classified by derivative instrument and risk category, for the six month period ended April 30, 2010.</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD>
     <TD width="11%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>STATEMENT OF</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>RISK</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>OPERATIONS LOCATION</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>FUTURES CONTRACTS</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>SWAP CONTRACTS</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>TOTAL</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=9>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Change in</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>unrealized</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Interest rate</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>appreciation</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>contracts</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>(depreciation)</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>($15,460)</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$594,179</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$578,719</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=9>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total</FONT></B>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>($15,460)</FONT></B>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$594,179</FONT></B>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$578,719</FONT></B>&nbsp;</TD></TR></TABLE><BR>
<P style="TEXT-ALIGN: left"><B><FONT size=2 face=sans-serif>Note 4 &#151; Guarantees and indemnifications</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Under the Fund&#146;s organizational documents, its Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts with service providers that contain general indemnification clauses. The Fund&#146;s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet occurred.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=2 face=sans-serif>Note 5 &#151; Fees and transactions with affiliates</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>John Hancock Advisers, LLC (the Adviser) serves as investment adviser for the Fund. The Adviser is indirect wholly owned subsidiary of Manulife Financial Corporation (MFC).</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Management fee. </FONT></B><FONT size=2 face=serif>The Fund has an investment management contract with the Adviser under which the Fund pays a daily management fee to the Adviser equivalent, on an annual basis, to the sum of (a) 0.650% of the first $150,000,000 of the Fund&#146;s average daily net assets and the value attributable to the credit facility agreement (collectively, managed assets), (b) 0.375% of the next $50,000,000, (c) 0.350% of the next $100,000,000 and (d) 0.300% of the Fund&#146;s average daily managed assets in excess of $300,000,000. The Adviser has a subadvisory agreement with MFC Global Investment Management (U.S.), LLC, an indirect owned subsidiary of MFC and an affiliate of the Adviser. The Fund is not responsible for payment of the subadvisory fees. The investment management fees incurred for the six months ended April 30, 2010 were equivalent to an annual effective rate of 0.55% of the Fund&#146;s managed assets.</FONT></P>

<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Accounting and legal services. </FONT></B><FONT size=2 face=serif>Pursuant to the Service Agreement, the Fund reimburses the Adviser for all expenses associated with providing the administrative, financial, legal, accounting and recordkeeping services of the Fund, including the preparation of all tax returns, periodic reports to shareholders and regulatory reports amongst other services. The accounting and legal services fees incurred for the six months ended April 30, 2010, amounted to an annual rate of 0.02% of the Fund&#146;s average daily net assets.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Trustee expenses. </FONT></B><FONT size=2 face=serif>The Trust compensates each Trustee who is not an employee of the Adviser or its affiliates. These Trustees may, for tax purposes, elect to defer receipt of this compensation under the John Hancock Group of Funds Deferred Compensation Plan (the Plan). Deferred amounts are invested in various John Hancock funds and remain in the funds until distributed in accordance with the Plan. The investment of deferred amounts and the offsetting liability are included in the accompanying Statement of Assets and Liabilities.</FONT></P>
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     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=2 face=sans-serif>31</FONT>&nbsp;</TD></TR></TABLE><BR>
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<P style="TEXT-ALIGN: left"><B><FONT size=2 face=sans-serif>Note 6 &#151; Fund share transactions</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Transactions in Fund shares for the six month period ended April 30, 2010 and the year ended October 31, 2009 were as follows:</FONT></P>
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     <TD noWrap align=left>&nbsp;</TD>
     <TD colSpan=2 noWrap align=right><B><FONT size=1 face=sans-serif>Six month period ended 4-30-10</FONT></B>&nbsp;</TD>
     <TD colSpan=2 noWrap align=right><B><FONT size=1 face=sans-serif>Year ended 10-31-09</FONT></B>&nbsp;</TD></TR>
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     <TD colSpan=5></TD></TR>
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     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Shares</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Amount</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Shares</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Amount</FONT></B>&nbsp;</TD></TR>
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     <TD noWrap align=left><FONT size=1 face=sans-serif>Distributions</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
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     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
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     <TD noWrap align=left><FONT size=1 face=sans-serif>reinvested</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>38,961</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$530,596</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>95,623</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>$1,059,251</FONT>&nbsp;</TD></TR></TABLE><BR>
<P style="TEXT-ALIGN: left"><B><FONT size=2 face=sans-serif>Note 7 &#151; Leverage</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The Fund utilizes a Committed Facility Agreement (CFA) to increase its assets available for investment. When the Fund leverages its assets, the common shareholders bear all fees associated with the facility and have the potential to benefit or be disadvantaged from the use of leverage. The Adviser&#146;s fee is also incurred from the use of leverage. Consequently, the Fund and the Adviser may have differing interests in determining whether to leverage the Fund&#146;s assets. Leverage creates risks which may adversely affect the return for the holders of common shares, including:</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>&#149; the likelihood of greater volatility of net asset value and market price of common shares</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>&#149; fluctuations in the interest rate paid for the use of the CFA</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>&#149; increased operating costs, which may reduce the Fund&#146;s total return</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>&#149; the potential for a decline in the value of an investment acquired through leverage, while the </FONT><FONT size=2 face=serif>Fund&#146;s obligations under such leverage remains fixed</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>&#149; the Fund is more likely to have to sell securities in a volatile market in order to meet asset </FONT><FONT size=2 face=serif>coverage or other debt compliance requirements</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>To the extent the income or capital appreciation derived from securities purchased with funds received from leverage exceeds the cost of leverage, the Fund&#146;s return will be greater than if leverage had not been used, conversely, return would be lower if the cost of the leverage exceeds the income or capital appreciation derived.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=2 face=sans-serif>Note 8 &#151; Committed facility agreement</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Effective June 2, 2009, the Fund entered into a CFA with a subsidiary of BNP Paribas (BNP) that allowed it to borrow up to an initial limit of $58 million and to invest the borrowings in accordance with its investment practices. On December 17, 2009, the Fund entered into an amendment to the CFA, increasing the amount the Fund can borrow under the CFA from $58 million to $90 million. Under the terms of the amendment, the Fund paid an arrangement fee of 0.25% on the increased amount of the committed financing upon execution of the amendment.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Borrowings under the CFA are secured by the assets of the Fund as disclosed in the schedule of investments. Interest charged is at the rate of one month LIBOR (reset daily) plus 0.85%. The Fund also pays a commitment fee of 0.60% per annum on the unused portion of the facility. Commitment and restructuring fees for the six months ended April 30, 2010 amounted to$30,050 and $104,445, respectively, and are included in the interest expense in the Statement of Operations. As of April 30, 2010, the Fund had borrowings of $80,000,000 at an interest rate of 1.13%, which are reflected in the Committed facility agreement payable on the Statement of asset and liabilities. November 1, 2009 to April 30, 2010, the average borrowing under the CFA and the effective average interest rate were $71,906,077 and 1.09%.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>If the Fund elects to renew the CFA, a renewal fee of 0.25% of the maximum commitment financing is due to BNP each 540th calendar day. In addition, the Fund may terminate the agreement with 60 days&#146; notice if the Board of Trustees has determined that the elimination of all indebtedness</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>leveraging in the Fund&#146;s investments is in the best interest of the Fund&#146;s shareholders. In certain circumstances, the CFA may automatically terminate, or it may be reduced to a 30-day facility. In addition, upon the occurrence of certain defaults, the lender may terminate the agreement upon 270 days&#146; notice.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>On October 30, 2009, the Fund entered into an agreement with BNP that allows BNP to borrow a portion of the pledged collateral (Lent Securities) in an amount not to exceed the lesser of: (i) outstanding borrowings owed by the Fund to BNP and (ii) thirty three and one third percent of the Fund&#146;s total assets. The Fund can designate any security within the pledged collateral as ineligible to be a Lent Security and can recall any of the Lent Securities. The Fund also has the right to apply and set-off an amount equal to one hundred percent (100%) of the then-current fair market value of such Lent Securities against the current borrowings under the CFA.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=2 face=sans-serif>Note 9 &#151; Purchase and sale of securities</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Purchases and sales of securities, other than short-term securities and U.S. Treasury obligations, aggregated $61,516,439 and $60,071,113, respectively for the six months ended April 30, 2010. Purchases and sales of U.S. Treasury obligations aggregated $63,021,153 and $44,833,965, respectively for the six months ended April 30, 2010.</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT size=4 face=sans-serif>Additional information</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Unaudited</FONT></B></P>
<P style="TEXT-ALIGN: left"><B><FONT size=2 face=sans-serif>Investment objective and policy</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The Fund is a closed-end diversified management investment company, common shares of which were initially offered to the public on February 14, 1973, and are publicly traded on the NYSE. The Fund&#146;s investment objective is to generate a high level of current income consistent with prudent investment risk. The Fund invests in a diversified portfolio of freely marketable debt securities and may invest an amount not exceeding 20% of its assets in income-producing preferred and common stock. Under normal circumstances, the Fund will invest at least 80% of net assets in income securities. Income securities will consist of the following: (i) marketable corporate debt securities, (ii) governmental obligations and (iii) cash and commercial paper. &#147;Net assets&#148; is defined as net assets plus borrowings for investment purposes. The Fund will notify shareholders at least 60 days prior to any change in this 80% investment policy.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>It is contemplated that at least 75% of the value of the Fund&#146;s total assets will be represented by debt securities, which have at the time of purchase a rating within the four highest grades as determined by Moody&#146;s Investors Service, Inc. or Standard &amp; Poor&#146;s Corporation. The Fund intends to engage in short-term trading and may invest in repurchase agreements.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Bylaws and Declaration of Trust</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>In November 2002, the Board of Trustees adopted several amendments to the Fund&#146;s bylaws, including provisions relating to the calling of a special meeting and requiring advance notice of shareholder proposals or nominees for Trustee. The advance notice provisions in the bylaws require shareholders to notify the Fund in writing of any proposal which they intend to present at an annual meeting of shareholders, including any nominations for Trustee, between 90 and 120 days prior to the first anniversary of the mailing date of the notice from the prior year&#146;s annual meeting of shareholders. The notification must be in the form prescribed by the bylaws. The advance notice provisions provide the Fund and its Trustees with the opportunity to thoughtfully consider and address the matters proposed before the Fund prepares and mails its proxy statement to shareholders. Other amendments set forth the procedures that must be followed in order for a shareholde
r to call a special meeting of shareholders. Please contact the Secretary of the Fund for additional information about the advance notice requirements or the other amendments to the bylaws.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>On August 21, 2003, shareholders approved the amendment of the Fund&#146;s bylaws effective August 26, 2003, to provide for the issuance of preferred shares.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>On March 31, 2008, the shareholders approved an amendment to the Fund&#146;s Declaration of Trust to permit the Fund&#146;s Board of Trustees to delegate the authority to declare dividends to a Dividend Committee consisting of officers, employees or agents of the Fund.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Effective September 9, 2008, the Fund&#146;s bylaws were amended with respect to notice requirements for Trustee nominations and other proposals by the Fund&#146;s shareholders. These provisions require the disclosure of the nominating shareholder and the nominee&#146;s investment interests as they relate to the Fund, as well as the name of any other shareholder supporting the nominee for election as a Trustee or the proposal of other business. In order for notice to be proper, such notice must disclose the economic interests of the nominating shareholder and nominee, including his or her holdings of shares in the Fund, the intent upon which those shares were acquired, and any hedging arrangements (including leveraged or short positions) made with respect to the shares of the Fund. Additionally, any material interest that the shareholder has in the business to be brought before the meeting must be disclosed.</FONT></P>
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<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Financial futures contracts and options</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The Fund may buy and sell financial futures contracts and options on futures contracts to hedge against the effects of fluctuations in interest rates and other market conditions. The Fund&#146;s ability to hedge successfully will depend on the Adviser&#146;s ability to predict accurately the future direction of interest rate changes and other market factors. There is no assurance that a liquid market for futures and options will always exist. In addition, the Fund could be prevented from opening, or realizing the benefits of closing out a futures or options position because of position limits or limits on daily price fluctuations imposed by an exchange.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The Fund will not engage in transactions in futures contracts and options on futures for speculation, but only for hedging or other permissible risk management purposes. All of the Fund&#146;s futures contracts and options on futures will be traded on a U.S. commodity exchange or board of trade. The Fund will not engage in a transaction in futures or options on futures if, immediately thereafter, the sum of initial margin deposits on existing positions and premiums paid for options on futures would exceed 5% of the Fund&#146;s total assets.</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Dividends and distributions</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>During the six month period ended April 30, 2010, dividends from net investment income totaling $0.57 per share were paid to shareholders. The dates of payments and the amounts per share were as follows:</FONT></P>
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     <TD noWrap align=left><FONT size=1 face=sans-serif>PAYMENT DATE</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>DIVIDEND</FONT>&nbsp;</TD>
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     <TD noWrap align=left><FONT size=1 face=sans-serif>December 31, 2009</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>0.2914</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
     <TD noWrap align=right></TD></TR>
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     <TD noWrap align=left><FONT size=1 face=sans-serif>March 31, 2010</FONT>&nbsp;</TD>
     <TD noWrap align=right><FONT size=1 face=sans-serif>0.2755</FONT>&nbsp;</TD>
     <TD noWrap align=right></TD>
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     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Total</FONT></B>&nbsp;</TD>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>$0.5669</FONT></B>&nbsp;</TD>
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<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Dividend reinvestment plan</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The Fund offers its shareholders a Dividend Reinvestment Plan (the Plan), which offers the opportunity to earn compounded yields. Each shareholder will automatically have all distributions of dividends and capital gains reinvested by Mellon Bank, N.A. as Plan agent (the Plan Agent), unless an election is made to receive cash. Each registered shareholder will receive from the Plan Agent an authorization card to be signed and returned if the shareholder elects to receive distributions from net investment income in cash or elects not to receive capital gains distributions in the form of a shares dividend. Shareholders may also make their election by notifying the Plan Agent by telephone or by visiting the Plan Agent&#146;s Web site at www.melloninvestor.com. Holders of common shares who elect not to participate in the Plan will receive all distributions in cash paid by check mailed directly to the shareholder of record (or if the common shares are held in stre
et or other nominee name, then to the nominee) by the Plan Agent, as dividend disbursing agent. Shareholders whose shares are held in the name of a broker or nominee, or shareholders transferring such an account to a new broker or nominee, should contact the broker or nominee to determine whether and how they may participate in the Plan.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The Plan Agent serves as agent for the holders of common shares in administering the Plan. After the Fund declares a dividend or makes a capital gains distribution, the Plan Agent will, as agent for the participants, receive the cash payment and use it to buy common shares in the open market, on the New York Stock Exchange or elsewhere, for the participants&#146; accounts. The Fund will not issue any new shares in connection with the Plan. The Plan Agent&#146;s fees for the handling of reinvestment of dividends and other distributions will be paid by the Fund. Each participant will pay a pro rata share of brokerage commissions incurred with respect to the Plan Agent&#146;s open market purchases in connection with the reinvestment of distributions. There are no other charges to participants for reinvesting dividends or capital gain distributions.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Participants in the Plan may withdraw from the Plan at any time by contacting the Plan Agent by telephone, in writing or by visiting the Plan Agent&#146;s Web site at www.melloninvestor.com. Such</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>withdrawal will be effective immediately if received prior to a dividend record date; otherwise, it will be effective for all subsequent dividend record dates. When a participant withdraws from the Plan or upon termination of the Plan, as provided below, either a cash payment will be made to the participant for the full value of the common shares credited to the account upon instruction by the participant, or certificates for whole common shares credited to his or her account under the Plan will be issued and a cash payment will be made for any fraction of a common share credited to such account. The Plan Agent maintains each shareholder&#146;s account in the Plan and furnishes monthly written confirmations of all transactions in the accounts, including information needed by the shareholders for personal and tax records. The Plan Agent will hold common shares in the account of each Plan participant in non-certificated form in the name of the participant. Pr
oxy material relating to shareholders&#146; meetings of the Fund will include those shares purchased as well as shares held pursuant to the Plan. In the case of shareholders such as banks, brokers or nominees, which hold common shares for others who are the beneficial owners, the Plan Agent will administer the Plan on the basis of the number of common shares certified from time to time by the record shareholders as representing the total amount registered in the record shareholder&#146;s name and held for the account of beneficial owners who are participants in the Plan. Shares may be purchased through broker-dealers.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>Dividends and capital gains distributions are taxable whether received in cash or reinvested in additional common shares, and the automatic reinvestment of dividends and capital gain distributions will not relieve participants of any U.S. federal income tax that may be payable or required to be withheld on such dividends or distributions. The amount of dividends to be reported on 1099-DIV should be the amount of cash used by the Plan Agent to purchase shares in the open market, including the amount of cash allocated to brokerage commissions paid on such purchases. Experience under the Plan may indicate that changes are desirable. Accordingly, the Fund reserves the right to amend or terminate the Plan as applied to any distribution paid subsequent to written notice of the change sent to all shareholders of the Fund at least 90 days before the record date for the dividend or distribution. The Plan may be amended or terminated by the Plan Agent by at least 90 
days&#146; written notice to all shareholders of the Fund. All correspondence or additional information concerning the Plan should be directed to the Plan Agent, Mellon Bank, N.A., c/o Mellon Investor Services, P.O. Box 358015, Pittsburgh, PA 15252-8015 (Telephone:1-800-852-0218).</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>Shareholder communication and assistance</FONT></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>If you have any questions concerning the Fund, we will be pleased to assist you. If you hold shares in your own name and not with a brokerage firm, please address all notices, correspondence, questions or other communications regarding the Fund to the transfer agent at:</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif><B>Mellon Investor Services</B></FONT><BR>
<FONT size=1 face=sans-serif><B>Newport Office Center VII</B></FONT><BR>
<FONT size=1 face=sans-serif><B>480 Washington Boulevard</B></FONT><BR>
<FONT size=1 face=sans-serif><B>Jersey City, NJ 07310</B></FONT><BR>
<FONT size=1 face=sans-serif><B>Telephone: 1-800-852-0218</B></FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>If your shares are held with a brokerage firm, you should contact that firm, bank or other nominee for assistance.</FONT></P>
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<P style="TEXT-ALIGN: left"><B><FONT size=2 face=sans-serif>Shareholder meeting </FONT></B><FONT size=2 face=sans-serif>(unaudited)</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=serif>The Fund held its Annual Meeting of Shareholders on January 22, 2010. The following action was taken by the shareholders:</FONT></P>
<P style="TEXT-ALIGN: left"><B><FONT size=2 face=serif>Proposal: </FONT></B><FONT size=2 face=serif>Election of eleven (11) Trustees to serve until their respective successors have been duly elected and qualified.</FONT></P>
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     <TD colSpan=3 noWrap align=left><B><FONT size=2 face=serif>THE PROPOSAL </FONT></B><B><FONT size=2 face=serif><U>PASSED</U> </FONT></B><B><FONT size=2 face=serif>FOR </FONT></B><B><FONT size=2 face=serif><U>ALL</U> </FONT></B><B><FONT size=2 face=serif>TRUSTEES ON JANUARY 22, 2010.</FONT></B>&nbsp;</TD></TR>
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     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>TOTAL VOTES FOR</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=left><FONT size=1 face=sans-serif>TOTAL VOTES WITHHELD</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>THE NOMINEE</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>FROM THE NOMINEE</FONT>&nbsp;</TD></TR>
<TR>
     <TD colSpan=3>
<HR SIZE=1 noShade>
</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>James R. Boyle</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>9,116,830</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>225,841</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>James F. Carlin</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>9,108,346</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>234,325</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>William H. Cunningham</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>9,110,289</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>232,382</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>Deborah C. Jackson</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=left><FONT size=2 face=serif>9,096,500</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>246,171</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>Charles L. Ladner</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>9,108,764</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>233,907</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>Stanley Martin</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>9,114,315</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>228,356</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>John A. Moore</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>9,103,485</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>239,186</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>Patti McGill Peterson</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>9,096,087</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>246,584</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>Steven R. Pruchansky</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>9,098,797</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>243,874</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>Gregory A. Russo</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>9,110,516</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>232,155</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>John G. Vrysen</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>9,110,849</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>231,822</FONT>&nbsp;</TD></TR></TABLE><BR>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="96%" align=right></TD>
     <TD width="4%" align=right></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=right><B><FONT size=1 face=sans-serif>Semiannual report | </FONT></B><FONT size=1 face=sans-serif>Income Securities Trust</FONT>&nbsp;</TD>
     <TD style="TEXT-INDENT: 0px" noWrap align=right><FONT size=2 face=sans-serif>37</FONT>&nbsp;</TD></TR></TABLE><BR>
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<P style="TEXT-ALIGN: left"><FONT size=7 face=serif>More information</FONT></P>
<TABLE border=0 cellSpacing=0 width="80%">
<TR>
     <TD width="33%"></TD>
     <TD width="33%"></TD>
     <TD width="33%"></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Trustees</FONT></B>&nbsp;</TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Officers</FONT></B>&nbsp;</TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Investment adviser</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>Patti McGill Peterson,&nbsp; </FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>Keith F. Hartstein</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>John Hancock Advisers, LLC</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><I><FONT size=2 face=serif>Chairperson</FONT></I>&nbsp;</TD>
     <TD noWrap align=left><I><FONT size=2 face=serif>President and</FONT></I>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>James R. Boyle</FONT><FONT size=1 face=sans-serif>&#134;</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;<I><FONT size=2 face=serif>Chief Executive Officer</FONT></I>&nbsp;</TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Subadviser</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>James F. Carlin</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>MFC Global Investment</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>William H. Cunningham</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>Andrew G. Arnott</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;<FONT size=2 face=serif>Management (U.S.), LLC</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>Deborah C. Jackson*</FONT>&nbsp;</TD>
     <TD noWrap align=left><I><FONT size=2 face=serif>Chief Operating Officer</FONT></I>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR height=20>
     <TD noWrap align=left><FONT size=2 face=serif>Charles L. Ladner</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Custodian</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>Stanley Martin*</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>Thomas M. Kinzler</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>State Street Bank and</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>Dr. John A. Moore</FONT>&nbsp;</TD>
     <TD noWrap align=left><I><FONT size=2 face=serif>Secretary and</FONT></I>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;<FONT size=2 face=serif>Trust Company</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>Steven R. Pruchansky*</FONT>&nbsp;</TD>
     <TD noWrap align=left><I><FONT size=2 face=serif>&nbsp;Chief Legal Officer</FONT></I>&nbsp;</TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>Gregory A. Russo</FONT>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Transfer agent</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=2 face=serif>John G. Vrysen</FONT><FONT size=1 face=sans-serif>&#134;</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>Francis V. Knox, Jr.</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>Mellon Investor Services</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>*Member of the Audit Committee</FONT>&nbsp;</TD>
     <TD noWrap align=left><I><FONT size=2 face=serif>Chief Compliance Officer</FONT></I>&nbsp;</TD>
     <TD noWrap align=left></TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left><FONT size=1 face=sans-serif>&#134;Non-Independent Trustee</FONT>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Legal counsel</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=2 face=serif>Charles A. Rizzo</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>K&amp;L Gates LLP</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><I><FONT size=2 face=serif>Chief Financial Officer</FONT></I>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left></TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Stock symbol</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>Salvatore Schiavone</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=serif>Listed New York Stock</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><I><FONT size=2 face=serif>Treasurer</FONT></I>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;<FONT size=2 face=serif>Exchange: JHS</FONT>&nbsp;</TD></TR></TABLE><BR>
<P style="TEXT-ALIGN: left"><B><FONT size=1 face=sans-serif>For shareholder assistance refer to page 36</FONT></B></P>
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     <TD noWrap align=left><FONT size=1 face=sans-serif>You can also contact us:</FONT>&nbsp;</TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>1-800-852-0218</FONT></B>&nbsp;</TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>Regular mail:</FONT></B>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><B><FONT size=1 face=sans-serif>jhfunds.com</FONT></B>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Mellon Investor Services</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Newport Office Center VII</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>480 Washington Boulevard</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Jersey City, NJ 07310</FONT>&nbsp;</TD></TR></TABLE><BR>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>The Fund&#146;s proxy voting policies and procedures, as well as the Fund&#146;s proxy voting record for the most recent twelve-month period ended June 30, are available free of charge on the Securities and Exchange Commission (SEC) Web site at www.sec.gov or on our Web site.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>The Fund&#146;s complete list of portfolio holdings, for the first and third fiscal quarters, is filed with the SEC on Form&nbsp;N-Q. The Fund&#146;s Form N-Q is available on our Web site and the SEC&#146;s Web site, www.sec.gov, and can be reviewed and copied (for a fee) at the SEC&#146;s Public Reference Room in Washington, DC. Call 1-800-SEC-0330 to&nbsp;receive information on the operation of the SEC&#146;s Public Reference Room.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>We make this information on your fund, as well as </FONT><B><FONT size=1 face=sans-serif>monthly portfolio holdings</FONT></B><FONT size=1 face=sans-serif>, and other fund details available on our Web site www.jhfunds.com or by calling 1-800-852-0218.</FONT></P>
<P style="TEXT-ALIGN: left"><I><FONT size=2 face=serif>The report is certified under the Sarbanes-Oxley Act, which requires mutual funds and other public companies to affirm that, to the best of their knowledge, the information in their financial reports is fairly and accurately stated in all material respects.</FONT></I></P>
<P style="TEXT-ALIGN: left"><I><FONT size=2 face=serif>The Fund is listed for trading on the NYSE and has filed with the NYSE its chief executive officer certification regarding compliance with the NYSE&#146;s listing standards. The Fund also files with the SEC the certification of its chief executive officer and chief financial officer required by Section 302 of the Sarbanes-Oxley Act.</FONT></I></P>
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     <TD noWrap align=left><FONT size=2 face=sans-serif>38</FONT>&nbsp;</TD>
     <TD noWrap align=left><FONT size=1 face=sans-serif>Income Securities Trust </FONT><B><FONT size=1 face=sans-serif>| Semiannual report</FONT></B>&nbsp;</TD></TR></TABLE><BR>
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<IMG border=0 src="incsecuritiestrustx35x1.jpg">
<BR>
<P style="TEXT-ALIGN: left"><FONT size=1 face=sans-serif>1-800-852-0218</FONT><BR>
<FONT size=1 face=sans-serif>1-800-231-5469 TDD</FONT><BR>
<FONT size=1 face=sans-serif>1-800-843-0090 EASI-Line</FONT><BR>
<FONT size=1 face=sans-serif>www.</FONT><FONT size=1 face=sans-serif>jhfunds.</FONT><FONT size=1 face=sans-serif>com</FONT><FONT size=1 face=sans-serif></FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>PRESORTED</FONT><BR>
<FONT size=2 face=sans-serif>STANDARD</FONT><BR>
<FONT size=2 face=sans-serif>U.S. </FONT><FONT size=2 face=sans-serif>POSTAGE</FONT><BR>
<FONT size=2 face=sans-serif>PAID</FONT><BR>
<FONT size=2 face=sans-serif>MIS</FONT></P>
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     <TD noWrap align=right><FONT size=1 face=sans-serif>P60SA 4/10</FONT>&nbsp;</TD></TR>
<TR vAlign=bottom>
     <TD noWrap align=right><FONT size=1 face=sans-serif>6/10</FONT>&nbsp;</TD></TR></TABLE><BR>
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<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>ITEM 2. CODE OF ETHICS.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>Not applicable.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>Not applicable at this time.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>Not applicable at this time.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>Not applicable at this time.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>ITEM 6. SCHEDULE OF INVESTMENTS.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(a) Not applicable.</FONT><BR>
<FONT size=2 face=sans-serif>(b) Not applicable.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>Not applicable.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>Not applicable.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>Not applicable.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>The registrant has adopted procedures by which shareholders may recommend nominees to the registrant's Board of Trustees. A copy of the procedures is filed as an exhibit to this Form N-CSR. See attached &#147;John Hancock Funds &#150; Governance Committee Charter&#148;.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>ITEM 11. CONTROLS AND PROCEDURES.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(a) Based upon their evaluation of the registrant's disclosure controls and procedures as conducted within 90 days of the filing date of this Form N-CSR, the registrant's principal executive officer and principal financial officer have concluded that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(b) There were no changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.</FONT></P>
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<P style="text-align: left;"> <FONT size=2 face="sans-serif">ITEM 12. EXHIBITS.</FONT></P>
<P style="text-align: left;"> <FONT size=2 face="sans-serif">(a) Separate certifications for the registrant's principal executive officer and principal financial officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment Company Act of 1940, are attached.</FONT></P>
<P style="text-align: left;"> <FONT size=2 face="sans-serif">(b) Separate certifications for the registrant's principal executive officer and principal financial officer, as required by 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and Rule 30a-2(b) under the Investment Company Act of 1940, are attached. The certifications furnished pursuant to this paragraph are not deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section. Such certifications are not deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Registrant specifically incorporates them by reference.</FONT></P>
<P style="text-align: left;"> <FONT size=2 face="sans-serif">(c)(1) Submission of Matters to a Vote of Security Holders is attached. See attached and &#147;John Hancock Funds &#150; Governance Committee Charter&#148;.</FONT></P>
<P style="text-align: left;"> <FONT size=2 face="sans-serif">(c)(2) Contact person at the registrant.</FONT></P>
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<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>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.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>John Hancock Income Securities Trust</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>By: /s/ Keith F. Hartstein</FONT><BR>
<FONT size=2 face=sans-serif>------------------------------</FONT><BR>
<FONT size=2 face=sans-serif>Keith F. Hartstein</FONT><BR>
<FONT size=2 face=sans-serif>President and Chief Executive Officer</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>Date: June 22, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>By: /s/ Keith F. Hartstein</FONT><BR>
<FONT size=2 face=sans-serif>-------------------------------</FONT><BR>
<FONT size=2 face=sans-serif>Keith F. Hartstein</FONT><BR>
<FONT size=2 face=sans-serif>President and Chief Executive Officer</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>Date: June 22, 2010</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>By: /s/ Charles A. Rizzo</FONT><BR>
<FONT size=2 face=sans-serif>-----------------------</FONT><BR>
<FONT size=2 face=sans-serif>Charles A. Rizzo</FONT><BR>
<FONT size=2 face=sans-serif>Chief Financial Officer</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>Date: June 22, 2010</FONT></P>
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<P style="TEXT-ALIGN: left"><B><U><FONT size=2 face=sans-serif>CERTIFICATION</FONT></U></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>I, Keith F. Hartstein, certify that:</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>1. I have reviewed this report on Form N-CSR of the John Hancock Income Securities Trust (the &#147;registrant&#148;);</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.</FONT></P>
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     <TD noWrap align=left><FONT size=2 face=sans-serif>Date: </FONT><U><FONT size=2 face=sans-serif>June 22, 2010</FONT></U>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=sans-serif>/<U>s/ Keith F. Hartstein______</U></FONT></TD></TR>
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     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=sans-serif>Keith F. Hartstein</FONT>&nbsp;</TD></TR>
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     <TD noWrap align=left><FONT size=2 face=sans-serif>President and</FONT>&nbsp;</TD></TR>
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     <TD noWrap align=left><FONT size=2 face=sans-serif>Chief Executive Officer</FONT>&nbsp;</TD></TR></TABLE><BR>
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<P style="TEXT-ALIGN: left"><B><U><FONT size=2 face=sans-serif>CERTIFICATION</FONT></U></B></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>I, Charles A. Rizzo, certify that:</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>1. I have reviewed this report on Form N-CSR of the John Hancock Income Securities Trust (the &#147;registrant&#148;);</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.</FONT></P>
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     <TD noWrap align=left><FONT size=2 face=sans-serif>Date: </FONT><U><FONT size=2 face=sans-serif>June 22, 2010</FONT></U>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=sans-serif><U>/s/ Charles A. Rizzo____</U></FONT></TD></TR>
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     <TD noWrap align=left><FONT size=2 face=sans-serif>Charles A. Rizzo</FONT>&nbsp;</TD></TR>
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     <TD noWrap align=left>&nbsp;</TD>
     <TD noWrap align=left><FONT size=2 face=sans-serif>Chief Financial Officer</FONT>&nbsp;</TD></TR></TABLE><BR>
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<TYPE>EX-99.906 CERT
<SEQUENCE>3
<FILENAME>c_incomeseccertnos.htm
<DESCRIPTION>CERTIFICATION 906
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     <TD noWrap align=center><B><FONT size=2 face=sans-serif>Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of</FONT></B>&nbsp;</TD></TR>
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     <TD align=center><B><FONT size=2 face=sans-serif>the Sarbanes-Oxley Act of 2002</FONT></B></TD></TR></TABLE><BR>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>In connection with the attached Report of John Hancock Income Securities Trust (the &#147;registrant&#148;) on Form N-CSR to be filed with the Securities and Exchange Commission (the "Report"), each of the undersigned officers of the registrant does hereby certify that, to the best of such officer's knowledge:</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and</FONT></P>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the registrant as of, and for, the periods presented in the Report.</FONT></P>
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     <TD noWrap align=left><FONT size=2 face=sans-serif>/s/ Keith F. Hartstein</FONT>&nbsp;</TD></TR>
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     <TD noWrap align=left><FONT size=2 face=sans-serif>--------------------------------</FONT>&nbsp;</TD></TR>
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     <TD noWrap align=left><FONT size=2 face=sans-serif>Keith F. Hartstein</FONT>&nbsp;</TD></TR>
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     <TD noWrap align=left><FONT size=2 face=sans-serif>President and Chief Executive Officer</FONT>&nbsp;</TD></TR>
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     <TD colSpan=2 noWrap align=left><FONT size=2 face=sans-serif>Dated: June 22, 2010</FONT>&nbsp;</TD></TR>
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     <TD noWrap align=left><FONT size=2 face=sans-serif>/s/ Charles A. Rizzo</FONT>&nbsp;</TD></TR>
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     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=2 face=sans-serif>------------------------------</FONT>&nbsp;</TD></TR>
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     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=2 face=sans-serif>Charles A. Rizzo</FONT>&nbsp;</TD></TR>
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     <TD noWrap align=left></TD>
     <TD noWrap align=left><FONT size=2 face=sans-serif>Chief Financial Officer</FONT>&nbsp;</TD></TR>
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     <TD colSpan=2 noWrap align=left><FONT size=2 face=sans-serif>Dated: June 22, 2010</FONT>&nbsp;</TD></TR></TABLE><BR>
<P style="TEXT-ALIGN: left"><FONT size=2 face=sans-serif>A signed original of this written statement, required by Section 906, has been provided to the registrant and will be retained by the registrant and furnished to the Securities and Exchange Commission or its staff upon request.</FONT></P>
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<TYPE>EX-99
<SEQUENCE>4
<FILENAME>d_governancecommcharter.htm
<DESCRIPTION>GOVERNANCE COMMITTEE CHARTER
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     <TD align=center><B><FONT face=sans-serif size=2>JOHN HANCOCK FUNDS</FONT></B> </TD></TR>
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     <TD noWrap align=center><B><FONT face=sans-serif size=2>NOMINATING, GOVERNANCE AND ADMINISTRATION COMMITTEE CHARTER</FONT></B>&nbsp; </TD></TR></TABLE><BR>
<P align=left><FONT face=sans-serif size=2>A. </FONT><U><FONT face=sans-serif size=2>Composition</FONT></U><FONT face=sans-serif size=2>. The Nominating, Governance and Administration Committee (the &#147;Committee&#148;) shall be composed entirely of Trustees who are &#147;independent&#148; as defined in the rules of the New York Stock Exchange (&#147;NYSE&#148;) or any other exchange, as applicable, and are not &#147;interested persons&#148; as defined in the Investment Company Act of 1940 of any of the funds, or of any fund&#146;s investment adviser or principal underwriter (the &#147;Independent Trustees&#148;) who are designated for membership from time to time by the Board of Trustees. The Chairman of the Board shall be a member of the Committee.</FONT></P>
<P align=left><FONT face=sans-serif size=2>B. </FONT><U><FONT face=sans-serif size=2>Overview</FONT></U><FONT face=sans-serif size=2>. The overall charter of the Committee is to make determinations and recommendations to the Board on issues related to the composition and operation of the Board and corporate governance matters applicable to the Independent Trustees, as well as issues related to complex-wide matters and practices designed to facilitate uniformity and administration of the Board's oversight of the funds, and to discharge such additional duties, responsibilities and functions as are delegated to it from time to time.</FONT></P>
<P align=left><FONT face=sans-serif size=2>C. </FONT><U><FONT face=sans-serif size=2>Specific Responsibilities</FONT></U><FONT face=sans-serif size=2>. The Committee shall have the following duties and powers, to be exercised at such times and in such manner as the Committee shall deem necessary or appropriate:</FONT></P>
<P align=left><FONT face=sans-serif size=2>1. To consider and determine nominations of individuals to serve as Trustees.</FONT></P>
<P align=left><FONT face=sans-serif size=2>2. To consider, as it deems necessary or appropriate, the criteria for persons to fill existing or newly created Trustee vacancies. The Committee shall use the criteria and principles set forth in Annex A to guide its Trustee selection process.</FONT></P>
<P align=left><FONT face=sans-serif size=2>3. To consider and determine the amount of compensation to be paid by the funds to the Independent Trustees, including incremental amounts, if any, payable to Committee Chairmen, and to address compensation-related matters. The Chairman of the Board has been granted the authority to approve special compensation to Independent Trustees in recognition of any significant amount of additional time and service to the funds required of them, subject to ratification of any such special compensation by the Committee at the next regular meeting of the Committee.</FONT></P>
<P align=left><FONT face=sans-serif size=2>4. To consider and determine the duties and compensation of the Chairman of the Board.</FONT></P>
<P align=left><FONT face=sans-serif size=2>5. To consider and recommend changes to the Board regarding the size, structure, and composition of the Board.</FONT></P>
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<P align=left><FONT face=sans-serif size=2>6. To evaluate, from time to time, and determine changes to the retirement policies for the Independent Trustees, as appropriate.</FONT></P>
<P align=left><FONT face=sans-serif size=2>7. To develop and recommend to the Board, if deemed desirable, guidelines for corporate governance (&#147;Corporate Governance Guidelines&#148;) for the funds that take into account the rules of the NYSE and any applicable law or regulation, and to periodically review and assess the Corporate Governance Guidelines and recommend any proposed changes to the Board for approval.</FONT></P>
<P align=left><FONT face=sans-serif size=2>8. To monitor all expenditures and practices of the Board or the Committees or the Independent Trustees not otherwise incurred and/or monitored by a particular Committee, including, but not limited to: D&amp;O insurance and fidelity bond coverage and costs; association dues, including Investment Company Institute membership dues; meeting expenditures and policies relating to reimbursement of travel expenses and expenses associated with offsite meetings; expenses and policies associated with Trustee attendance at educational or informational conferences; and publication expenses.</FONT></P>
<P align=left><FONT face=sans-serif size=2>9. To consider, evaluate and make recommendations and necessary findings regarding independent legal counsel and any other advisers, experts or consultants, that may be engaged by the Board of Trustees, by the Trustees who are not &#147;interested persons&#148; as defined in the Investment Company Act of 1940 of any of the funds or any fund&#146;s investment adviser or principal underwriter, or by the Committee, from time to time, other than as may be engaged directly by another Committee.</FONT></P>
<P align=left><FONT face=sans-serif size=2>10. To periodically review the Board&#146;s committee structure and the charters of the Board&#146;s committees, and recommend to the Board of Trustees changes to the committee structure and charters as it deems appropriate.</FONT></P>
<P align=left><FONT face=sans-serif size=2>11. To coordinate and administer an annual self-evaluation of the Board, which will include, at a minimum, a review of its effectiveness in overseeing the number of funds in the fund complex and the effectiveness of its committee structure.</FONT></P>
<P align=left><FONT face=sans-serif size=2>12. To report its activities to Board of Trustees and to make such recommendations with respect to the matters described above and other matters as the Committee may deem necessary or appropriate.</FONT></P>
<P align=left><FONT face=sans-serif size=2>D. </FONT><U><FONT face=sans-serif size=2>Additional Responsibilities</FONT></U><FONT face=sans-serif size=2>. The Committee will also perform other tasks assigned to it from time to time by the Chairman of the Board or by the Board of Trustees, and will report findings and recommendations to the Board of Trustees, as appropriate.</FONT></P>
<P align=left><FONT face=sans-serif size=2>E. </FONT><U><FONT face=sans-serif size=2>Governance</FONT></U><FONT face=sans-serif size=2>. One member of the Committee shall be appointed as chair. The chair shall be responsible for leadership of the Committee, including scheduling meetings or</FONT></P>
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<P align=left><FONT face=sans-serif size=2>reviewing and approving the schedule for them, preparing agendas or reviewing and approving them before meetings, and making reports to the Board of Trustees, as appropriate.</FONT></P>
<P align=left><FONT face=sans-serif size=2>F. </FONT><U><FONT face=sans-serif size=2>Miscellaneous</FONT></U><FONT face=sans-serif size=2>. The Committee shall meet as often as it deems appropriate, with or without management, as circumstances require. The Committee shall have the resources and authority appropriate to discharge its responsibilities, including the authority to retain special counsel and other advisers, experts or consultants, at the funds&#146; expense, as it determines necessary to carry out its duties. The Committee shall have direct access to such officers of and service providers to the funds as it deems desirable.</FONT></P>
<P align=left><FONT face=sans-serif size=2>G. </FONT><U><FONT face=sans-serif size=2>Evaluation</FONT></U><FONT face=sans-serif size=2>. At least annually, the Committee shall evaluate its own performance, including whether the Committee is meeting frequently enough to discharge its responsibilities appropriately.</FONT></P>
<P align=left><FONT face=sans-serif size=2>H. </FONT><U><FONT face=sans-serif size=2>Review</FONT></U><FONT face=sans-serif size=2>. The Committee shall review this Charter periodically and recommend such changes to the Board of Trustees as it deems desirable.</FONT></P>
<P align=left><FONT face=sans-serif size=2>Last revised: December 9, 2008</FONT></P>
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<P align=left><FONT face=sans-serif size=2>ANNEX A</FONT></P>
<P align=left><B><FONT face=sans-serif size=2>General Criteria</FONT></B></P>
<P align=left><FONT face=sans-serif size=2>1. Nominees should have a reputation for integrity, honesty and adherence to high ethical standards.</FONT></P>
<P align=left><FONT face=sans-serif size=2>2. Nominees should have demonstrated business acumen, experience and ability to exercise sound judgments in matters that relate to the current and long-term objectives of the funds and should be willing and able to contribute positively to the decision-making process of the funds.</FONT></P>
<P align=left><FONT face=sans-serif size=2>3. Nominees should have a commitment to understand the funds, and the responsibilities of a trustee/director of an investment company and to regularly attend and participate in meetings of the Board and its committees.</FONT></P>
<P align=left><FONT face=sans-serif size=2>4. Nominees should have the ability to understand the sometimes conflicting interests of the various constituencies of the funds, including shareholders and the management company, and to act in the interests of all shareholders.</FONT></P>
<P align=left><FONT face=sans-serif size=2>5. Nominees should not have, nor appear to have, a conflict of interest that would impair their ability to represent the interests of all the shareholders and to fulfill the responsibilities of a director/trustee.</FONT></P>
<P align=left><B><FONT face=sans-serif size=2>Application of Criteria to Existing Trustees</FONT></B></P>
<P align=left><FONT face=sans-serif size=2>The renomination of existing Trustees should not be viewed as automatic, but should be based on continuing qualification under the criteria set forth above. In addition, the Nominating, Governance and Administration Committee (the &#147;Committee&#148;) shall consider the existing Trustee&#146;s performance on the Board and any committee.</FONT></P>
<P align=left><B><FONT face=sans-serif size=2>Review of Shareholder Nominations</FONT></B></P>
<P align=left><FONT face=sans-serif size=2>Any shareholder nomination must be submitted in compliance with all of the pertinent provisions of Rule 14a-8 under the Securities Exchange Act of 1934 in order to be considered by the Committee. In evaluating a nominee recommended by a shareholder, the Committee, in addition to the criteria discussed above, may consider the objectives of the shareholder in submitting that nomination and whether such objectives are consistent with the interests of all shareholders. If the Board determines to include a shareholder&#146;s candidate among the slate of its designated nominees, the candidate&#146;s name will be placed on the funds&#146; proxy card. If the Board determines not to include such candidate among its designated nominees, and the shareholder has satisfied the requirements of Rule 14a-8, the shareholder&#146;s candidate will be</FONT></P>
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<P align=left><FONT face=sans-serif size=2>treated as a nominee of the shareholder who originally nominated the candidate. In that case, the candidate will not be named on the proxy card distributed with the funds&#146; proxy statement.</FONT></P>
<P align=left><FONT face=sans-serif size=2>As long as an existing Independent Trustee continues, in the opinion of the Committee, to satisfy the criteria listed above, the Committee generally would favor the re-nomination of an existing Trustee rather than a new candidate. Consequently, while the Committee will consider nominees recommended by shareholders to serve as trustees, the Committee may only act upon such recommendations if there is a vacancy on the Board, or the Committee determines that the selection of a new or additional Trustee is in the best interests of the fund. In the event that a vacancy arises or a change in Board membership is determined to be advisable, the Committee will, in addition to any shareholder recommendations, consider candidates identified by other means, including candidates proposed by members of the Committee. The Committee may retain a consultant to assist the Committee in a search for a qualified candidate.</FONT></P>
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end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
