(PUB) Morningstar FundInvestor

February 2 014

Morningstar FundInvestor

5

Data through January 31, 2014 Loomis Sayles Bond Instl

Ticker Status Yield SEC Yield Total Assets Mstar Category LSBDX Open 5.0% 3.38% $22,090 mil Multisector Bond

Morningstar Analyst Rating 01-30-14

Investment Style Fixed Income Income Rtn %Rank Cat

Historical Profile Return Risk Rating Above Avg Above Avg Above Avg

26

17

20

36

39

23

13

18

51

Œ

Manager Change Partial Manager Change

13.0 16.0 19.6 23.8

Morningstar Pillars Process Performance

Positive Positive Positive Positive Positive

∞ ∞ ∞ ∞ ∞

Growth of $10,000

Investment Values of Fund Investment Values of BC Agg Bnd Performance Quartile (within Category) History

People Parent Price

10.0

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 01-14

Morningstar Analyst Rating Morningstar evaluates mutual funds based on five key pillars, which its analysts believe lead to funds that are more likely to outperform over the long term on a risk-adjusted basis. Analyst Rating Spectrum Œ „ ´ˇ ¨

13.32 29.18 25.08 23.36

13.82 11.30

13.56 4.28 1.85 1.56 6.17 -1.89

14.29 11.29

14.58

10.39

13.34 37.19 31.26 28.59

14.27 13.58

13.93 3.76 -4.08 -3.64 6.33 -2.57

15.12 15.13 10.92

15.16

15.11 -0.02 -1.50 -1.34 0.32 -0.34

NAV

-21.82 8.53 -27.06 1.56 -24.20 2.03

5.88 7.90 7.23 5.15 0.73 0.76 0.07 0.63 4.57 14

Total Return % +/-BC Agg Bnd

6.96 6.33 7.31 3.99 0.95 0.00 0.75 5.48 8

6.96 6.32 5.77 5.52 0.77 0.00 0.75 5.20 2

7.04 6.42 6.41 7.17 0.83 0.00 0.64 5.76 21

9.60 6.42 8.71 0.87 0.00 0.63 4.99 11

+/-BC US Universal Income Return % Capital Return % Total Rtn % Rank Cat

7.44

6.45

7.15

7.73

21.74

-28.97 2.08

29.46

7

11

8

85

14

45

74

Pillar Spectrum Positive ∞

0.80 0.00 0.75 6.64

0.83 0.00 0.75 4.91

0.90 0.00 0.67 5.75

1.01 0.11 0.64 6.78

0.78 0.00 0.65 7.69

0.88 0.00 0.63 5.04

0.05 0.00

Income $

§ Negative

¶ Neutral

Capital Gains $ Expense Ratio % Income Ratio % Turnover Rate % Net Assets $mil

. . .

Performance 01-31-14 1st Qtr 2nd Qtr

3rd Qtr

4th Qtr

Total

35

22

26

20

26

39

27

22

20

28

.

2009 2010 2011 2012 2013

-0.08 17.21 12.35 4.27 37.19 4.99 -0.94 6.97 2.09 13.58 3.48 2.88 -4.92 2.51 3.76 6.59 0.05 4.76 3.06 15.13 2.27 -1.39 2.48 2.45 5.88

2,004

2,696

3,378

5,446

8,425

13,363 13,271 13,111 11,046 11,083 10,780 6,597

Portfolio Analysis 11-30-13

Rating and Risk Time Load-Adj

Date of Maturity

Amount

Value % Net $000 Assets

Morningstar

Morningstar Risk vs Cat

Morningstar Risk-Adj Rating

Period Return % Rtn vs Cat

Total Fixed-Income:472

$000

1 Yr 3 Yr 5 Yr

4.18 7.73

Trailing

Total

+/- BC

+/- BC %Rank Growth of

Canada Govt 2.5%

06-01-15 597,515 574,888 2.67 09-30-15 439,435 439,401 2.04

Return% Agg Bnd US Universal

Cat

$10,000

+Avg +Avg +Avg

+Avg +Avg +Avg

US Treasury Note 0.25%

3 Mo 6 Mo 1 Yr

0.44 -0.09 3.51 1.73 4.18 4.06 7.73 4.00 14.21 9.28 7.90 3.28 8.66 3.37

-0.11 1.53 3.69 3.56 8.40 3.00 3.09

62 10,044 24 10,351 19 10,418 12 12,503 15 19,432 6 21,390 5 34,757

14.21

Intel Corp

18,412 438,932 2.04

10 Yr Incept

7.90

Canada Govt 1.25% Intel Cv 3.25% Canada Govt 1%

02-01-16 445,239 420,569 1.95 08-01-39 318,925 407,427 1.89 08-01-16 414,485 388,272 1.80

10.08

3 Yr Avg 5 Yr Avg 10 Yr Avg 15 Yr Avg

Other Measures

Standard Index

Best Fit Index

BC Agg Bnd

DJ Mod

Ford Mtr Co Del Cv 4.25% 11-15-16 182,545 369,311 1.71 Koenigreich Norwegen 5% 05-15-15 2,107,745 360,843 1.67 US Treasury Bond 2.875% 05-15-43 430,980 357,713 1.66 US Treasury Bond 2.75% 11-15-42 384,695 311,603 1.45 General Mtrs Cv 5,217 276,595 1.28 Vereinigte Mexikanische 12-07-23 3,189,570 275,471 1.28 US Treasury Note 0.125% 12-31-14 258,500 258,440 1.20 Valeant Pharmaceuticals 2,148 235,514 1.09 Canada Govt 4.25% 06-01-18 222,760 233,465 1.08 Norway(Kingdom Of) 4.25% 05-19-17 1,316,210 232,198 1.08 Gen Elec Cap 6.5% 09-28-15 266,643 225,048 1.04 Springleaf Fin Corporati 10-01-21 194,610 206,773 0.96 Canada Govt 3% 12-01-15 201,175 196,538 0.91 Intesa Sanpaolo S P A 14 01-15-19 184,800 185,636 0.86 Current Investment Style Sector Breakdown % of assets

Alpha

5.6

1.9

Beta

0.56

0.75

R-Squared

5

83

Tax Analysis Tax-Adj Rtn% %Rank Cat Tax-Cost Rat %Rank Cat 3 Yr (estimated) 5 Yr (estimated) 10 Yr (estimated) 5.45 11 2.11 75 11.78 10 2.13 70 5.50 5 2.22 75 Potential Capital Gain Exposure: 9% of assets Morningstar’s Take by Sarah Bush 01-30-14 Loomis Sayles Bond’s charms were on full display in 2013. In the midst of a tough year for most bond investors, this fund shone. Up 5.9% for 2013, the fund topped more than 80% of its multisector peers and handily beat the high-quality Barclays Aggregate Bond Index, which suffered its first loss in more than a decade. It’s not surprising to see this credit-intensive fund prosper in a market that favored lower-rated fare; close to a fifth of the portfolio is stashed in junk bonds. Managers Matt Eagan, Dan Fuss, and Elaine Stokes also deserve kudos for positioning this once rate-sensitive portfolio with minimal exposure to rising Treasury yields and building a meaningful stake in equities (6% common stock as of November 2013) and convertibles (10%), both big winners in the year’s healthy stock markets. Another success was the fund’s significant overweighting to financials, including consumer loan provider Springleaf Financial, which netted an upgrade. Indeed, this Gold-rated fund has plenty going for it.

Standard Deviation

6.80 7.73 1.12

Mean

Sharpe Ratio

Its talented manager team remains strong even after longtime manager Kathleen Gaffney’s 2012 departure, and Loomis Sayles continues to make significant investments in its analyst bench and risk analytics. Meanwhile, the team’s ability to uncover undervalued names--Ireland and Ford F were particular successes in recent years--has helped it to an 8% 10-year return that lags just a handful of its peers’. It might be tempting to pile into a fund that managed exceptional returns over the bond bull market and thrived in 2013 as well. But this is not an all-weather fund. The corporate-heavy portfolio, which invests heavily in nondollar currencies (35%, recently), equities, and the occasional troubled sovereign, is vulnerable to hefty losses when credit and stock markets head south. The fund also features a fairly high correlation to the S&P 500 Index, limiting its diversification potential for equity-heavy portfolios. For those with the requisite patience, this fund remains a star.

US Treasury

7

Duration Ltd Mod Ext

Non US Government Government Related

18

Quality High Med Low

3

Corporate

59

figure provided by fund

1

Agency MBS Pass-Through

0 0

Agency MBS ARM Agency MBS CMO 0 Non-Agency Residential MBS 0 Commercial MBS 0 Asset-Backed 3 Municipal 3 Cash & Equivalents 7 Other 0 Composition - Net Cash 5.9 Bonds 71.0 Stocks 6.2 Other 16.8

1 Avg Eff Duration Avg Eff Maturity Avg Credit Quality Avg Wtd Coupon Avg Wtd Price Coupon Range

5.1 Yrs 8.0 Yrs

BB

5.40%

100.96% of par

% of Bonds Rel Cat

0% PIK 0% to 6% 6% to 8% 8% to 10%

0.1 0.0 52.6 0.9 37.4 1.5 7.6 0.6 2.4 0.7

More than 10%

Address:

399 Boylston Street Boston, MA 02116 800-633-3330 www.loomissayles.com

Minimum Purchase: Min Auto Inv Plan:

$100000

Add: $50 IRA: $0

1.00=Category Average

$0

Add: .

Credit Analysis

Special Securities Restricted/Illiquid Secs Exotic Mortgage-Backed Emerging-Markets Secs Options/Futures/Warrants

% bonds 11-30-13

Sales Fees:

No-load

BB

16

AAA

26

14

Web Address: Inception: Advisor: Subadvisor: NTF Plans:

Management Fee:

0.60% mx./0.49% mn. Mgt:0.51% Dist: .

B 8 Below B 4 NR/NA 8

AA

4

0 3

05-16-91

Actual Fees:

Loomis Sayles & Company L.P.

Expense Projections: Income Distribution:

3Yr:$202 Monthly

5Yr:$351 10Yr:$786

A

12 24

None

No

BBB

Schwab OneSource

Mutual Funds ß ®

© 2014Morningstar, Inc.All rights reserved. The information herein isnot representedorwarranted tobe accurate, correct, completeor timely.Pastperformance isnoguaranteeof future results.Accessupdated reports at To order reprints, call 312-696-6100. mfb.morningstar.com.

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