UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
Certified Shareholder Report of
Registered Management Investment Companies
Investment Company Act File Number: 811-22744
American Funds Corporate Bond Fund
(Exact Name of Registrant as Specified in Charter)
6455 Irvine Center Drive
Irvine, California 92618
(Address of Principal Executive Offices)
Registrant's telephone number, including area code: (949) 975-5000
Date of fiscal year end: May 31
Date of reporting period: November 30, 2019
Brian C. Janssen
American Funds Corporate Bond Fund
6455 Irvine Center Drive
Irvine, California 92618
(Name and Address of Agent for Service)
ITEM 1 – Reports to Stockholders
American Funds
Semi-annual report |
 |
A research-driven
fund of high-quality
corporate bonds
Beginning January 1, 2021, as permitted by regulations adopted by the U.S. Securities and Exchange Commission, we intend to no longer mail paper copies of the fund’s shareholder reports, unless specifically requested from American Funds or your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on the Capital Group website (capitalgroup.com); you will be notified by mail and provided with a website link to access the report each time a report is posted. If you have already elected to receive shareholder reports electronically, you will not be affected by this change and do not need to take any action. If you prefer to receive shareholder reports and other communications electronically, you may update your mailing preferences with your financial intermediary, or enroll in e-delivery at capitalgroup.com (for accounts held directly with the fund).
You may elect to receive paper copies of all future reports free of charge. If you invest through a financial intermediary, you may contact your financial intermediary to request that you continue to receive paper copies of your shareholder reports. If you invest directly with the fund, you may inform American Funds that you wish to continue receiving paper copies of your shareholder reports by contacting us at (800) 421-4225. Your election to receive paper reports will apply to all funds held with American Funds or through your financial intermediary.
American Funds Corporate Bond Fund seeks to provide maximum total return consistent with capital preservation and prudent risk management.
This fund is one of more than 40 offered by Capital Group, home of American Funds, one of the nation’s largest mutual fund families. For more than 85 years, Capital Group has invested with a long-term focus based on thorough research and attention to risk.
Fund results shown in this report, unless otherwise indicated, are for Class A shares at net asset value. If a sales charge (maximum 3.75%) had been deducted, the results would have been lower. Results are for past periods and are not predictive of results for future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. Investing for short periods makes losses more likely. For current information and month-end results, visit capitalgroup.com.
Here are total returns on a $1,000 investment with all distributions reinvested for periods ended December 31, 2019 (the most recent calendar quarter-end):
| Cumulative | Average annual total return | |||||
| total return | Lifetime | |||||
| Class A shares | 1 year | 5 years | (since 12/14/12) | |||
| Reflecting 3.75% maximum sales charge | 9.20% | 3.95% | 3.72% | |||
The total annual fund operating expense ratio was 0.90% for Class A shares as of the prospectus dated August 1, 2019. The expense ratio is restated to reflect current fees. The net expense ratio is 0.86%.
Investment results assume all distributions are reinvested and reflect applicable fees and expenses. The investment adviser is currently reimbursing a portion of other expenses. This reimbursement will be in effect through at least August 1, 2020. After that time, the adviser may elect at its discretion to extend, modify or terminate the reimbursement. Investment results and the net expense ratio shown reflect the reimbursement, without which the results would have been lower and the expenses would have been higher. Refer to the fund’s most recent prospectus for details. Visit capitalgroup.com for more information.
Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.
Fellow investors:
We are pleased to present the semiannual report for American Funds Corporate Bond Fund. For the six months ended November 30, 2019, the fund returned 5.74%, with all dividends reinvested. By way of comparison, the Bloomberg Barclays U.S. Corporate Investment Grade Index returned 6.48%, while the fund’s peer group, as measured by the Lipper Corporate Debt Funds BBB-Rated Average, returned 5.61%.
During this time, the fund generated dividends totaling about 13 cents a share, providing investors who reinvested dividends with an income return of 1.23% over the past six months.
At the end of the period, the fund’s corporate holdings — representing about 87% of the portfolio — were diversified across a variety of sectors. Bonds issued by financial firms made up 15.5% of the portfolio, utilities accounted for 13.5% and energy came to 12.7%. Industry exposure in the health care sector totaled 11.4%, while consumer staples was 8.6%. Government securities represented 7.4% of the portfolio. About 76% of the fund’s securities are issued by companies domiciled in the U.S., with the rest chiefly domiciled in the United Kingdom, Canada and Japan. A summarized list of fund holdings begins on page 4.
Economic backdrop
Global economic growth softened during the past six months as international trade tensions and political risks weighed on business investment and manufacturing activity. The U.S. economy was comparatively healthy, while the European economy
Results at a glance
For periods ended November 30, 2019, with all distributions reinvested
| Average annual total returns | ||||||||||||||||||||
| Cumulative total returns | Lifetime (since | |||||||||||||||||||
| 6 months | 1 year | 3 years | 5 years | 12/14/12) | ||||||||||||||||
| American Funds Corporate Bond Fund (Class A shares) | 5.74 | % | 14.62 | % | 5.47 | % | 4.68 | % | 4.31 | % | ||||||||||
| Bloomberg Barclays U.S. Corporate Investment Grade Index* | 6.48 | 15.85 | 6.04 | 4.55 | 4.10 | |||||||||||||||
| Lipper Corporate Debt Funds BBB-Rated Average† | 5.61 | 14.27 | 5.43 | 3.94 | 3.69 | |||||||||||||||
| Lipper Corporate Debt Funds A-Rated Average† | 5.07 | 13.21 | 5.07 | 3.68 | 3.40 | |||||||||||||||
| * | Source: Bloomberg Index Services Ltd. The market index is unmanaged and, therefore, has no expenses. Investors cannot invest directly in an index. |
| † | Source: Refinitiv Lipper. Lipper averages reflect the current composition of all eligible mutual funds (all share classes) within a given category. |
| American Funds Corporate Bond Fund | 1 |
grew only slightly, hurt by export weakness and uncertainty surrounding the U.K.’s departure from the European Union. In Asia, slowing growth in China reverberated through the region’s economies. U.S. economic growth slowed, although it continued to outpace other advanced markets. Solid consumer spending, driven by 50-year lows in unemployment and modest wage growth, remained a key support for the U.S. economy amid softness in manufacturing.
Central banks around the world loosened monetary policy to stimulate growth. After steadily tightening policy in 2018, the U.S. Federal Reserve reversed course and cut the federal funds rate three times in the second half of 2019 to a range of 1.50%-1.75%. Upon the third increase in October, the Fed signaled a pause to further policy changes. The European Central Bank cut rates further into negative territory in September and announced that it will resume its bond-buying program to revive an economy that has struggled for momentum.
Financial markets were volatile, driven largely by the U.S.-China trade dispute. Stocks suffered several pronounced declines, but easier monetary policy and fitful progress on trade fueled subsequent rebounds. The Standard & Poor’s 500 Composite Index1 ended the period just shy of a record high. Central bank policy also drove a rally in government bonds. The 10-year U.S. Treasury yield fell to a three-year low below 1.50% in early September before rebounding modestly.
Corporate bond market
Corporate bonds rallied, with investment-grade credit spreads ending the six-month period near their 2019 lows. Yield-hungry investors, facing uncertainty on global trade and late-cycle dynamics in the U.S. economy, sought the relative safety of higher rated debt. Bond issuance was solid through the first 11 months of 2019, trailing the year-ago level by just 4%.
Inside the fund
In a volatile environment, the fund managers continue to evaluate opportunities and exposures carefully, focusing on companies with improving credit trajectories and strong management teams. Relative returns in the fund over the past six months were primarily driven by issuer selection.
The fund participated in several notable new issues, including those from pharmaceutical companies AbbVie and Bristol-Myers. Both were related to acquisitions. AbbVie borrowed $30 billion to fund its acquisition of Allergan, while Bristol-Myers borrowed $19 billion for its acquisition of Celgene. Managers expect some volatility in the pharmaceutical sector related to the 2020 U.S. election and drug price reform, but they believe that both companies will realize synergies and generate sufficient free cash flow to meaningfully reduce balance sheet leverage.
| 1 | The Standard & Poor’s 500 Composite Index is a market capitalization-weighted index based on the results of approximately 500 widely held common stocks. |
| 2 | American Funds Corporate Bond Fund |
Turning to corporate sectors, the fund has an overweight position versus the index in bonds issued by electric utilities. Managers have leveraged deep, fundamental research, including regular meetings with regulators and lawmakers, to evaluate the operating environment and find investment opportunities at attractive valuations. They added exposure to Southern California Edison considering the company’s more stable fundamentals and a clearer outlook with respect to wildfire regulation and liabilities. The portfolio has an underweight position in technology relative to the index. While managers generally view large technology company valuations as elevated, they are finding idiosyncratic opportunities among smaller technology companies through fundamental analysis.
Outlook
The fund’s managers expect slow but still-positive economic growth and accommodative monetary policy to be broadly supportive of corporate credit heading into 2020. Elevated valuations as reflected in tight corporate credit spreads underscore the importance of rigorous credit research and disciplined security selection. Managers continue to selectively find value in companies that have assumed debt for mergers and acquisitions and have credible plans to deleverage their balance sheets. Looking ahead, trade tensions and political uncertainties will likely stoke further bouts of market volatility.
We thank you for making American Funds Corporate Bond Fund part of your portfolio.
Cordially,
David S. Lee
President
January 16, 2020
The fund’s 30-day yield for Class A shares as of December 31, 2019, reflecting the 3.75% maximum sales charge and calculated in accordance with the U.S. Securities and Exchange Commission formula, was 1.69% (1.68% without the reimbursement).
The return of principal for bond funds and for funds with significant underlying bond holdings is not guaranteed. Fund shares are subject to the same interest rate, inflation and credit risks associated with the underlying bond holdings. Investing in bonds issued outside the U.S. may be subject to additional risks. They include currency fluctuations, political and social instability, differing securities regulations and accounting standards, higher transaction costs, possible changes in taxation, illiquidity and price volatility. These risks may be heightened in connection with investments in developing countries. Refer to the fund prospectus and the Risk Factors section of this report for more information on these and other risks associated with investing in the fund.
| American Funds Corporate Bond Fund | 3 |
| Summary investment portfolio November 30, 2019 | unaudited |
| Industry sector diversification | Percent of net assets |
| Portfolio quality summary* | Percent of net assets | |||
| U.S. Treasury and agency† | 7.40 | % | ||
| AAA/Aaa | 2.12 | |||
| AA/Aa | 16.64 | |||
| A/A | 31.87 | |||
| BBB/Baa | 35.59 | |||
| Below investment grade | 1.61 | |||
| Short-term securities & other assets less liabilities | 4.77 | |||
| * | Bond ratings, which typically range from AAA/Aaa (highest) to D (lowest), are assigned by credit rating agencies such as Standard & Poor’s, Moody’s and/or Fitch as an indication of an issuer’s creditworthiness. In assigning a credit rating to a security, the fund looks specifically to the ratings assigned to the issuer of the security by Standard & Poor’s, Moody’s and/or Fitch. If agency ratings differ, the security will be considered to have received the highest of those ratings, consistent with the fund’s investment policies. |
| † | These securities are guaranteed by the full faith and credit of the U.S. government. |
| Bonds, notes & other debt instruments 95.23% | Principal amount (000) | Value (000) | ||||||
| Corporate bonds & notes 87.48% | ||||||||
| Financials 15.50% | ||||||||
| Berkshire Hathaway Finance Corp. 4.20%–4.25% 2048–2049 | $ | 1,850 | $ | 2,187 | ||||
| Berkshire Hathaway Inc. 3.13%–4.50% 2026–2043 | 1,475 | 1,576 | ||||||
| Goldman Sachs Group, Inc. (3-month USD-LIBOR + 0.80%) 2.927% 20191 | 3,750 | 3,751 | ||||||
| HSBC Holdings PLC 3.973% 2030 (3-month USD-LIBOR + 1.61% on 5/22/2029)2 | 4,995 | 5,345 | ||||||
| JPMorgan Chase & Co. 2.25% 2020 | 1,552 | 1,552 | ||||||
| JPMorgan Chase & Co. (3-month USD-LIBOR + 0.955%) 2.889% 20201 | 3,800 | 3,805 | ||||||
| JPMorgan Chase & Co. 2.301% 2025 (USD-SOFR + 1.16% on 10/15/2024)2 | 5,300 | 5,290 | ||||||
| JPMorgan Chase & Co. 2.739% 2030 (USD-SOFR + 1.51% on 10/15/2029)2 | 6,009 | 6,004 | ||||||
| Wells Fargo & Co. (3-month USD-LIBOR + 0.65%) 2.762% 20191 | 8,425 | 8,426 | ||||||
| 4 | American Funds Corporate Bond Fund |
| Principal amount (000) | Value (000) | |||||||
| Wells Fargo & Co. 2.879% 2030 (3-month USD-LIBOR + 1.17% on 10/30/2029)2 | $ | 8,280 | $ | 8,328 | ||||
| Wells Fargo & Co. 2.41%–3.20% 2025–20272 | 3,425 | 3,461 | ||||||
| Other securities | 81,993 | |||||||
| 131,718 | ||||||||
| Utilities 13.48% | ||||||||
| Dominion Resources, Inc., junior subordinated, 3.071% 20242 | 1,000 | 1,025 | ||||||
| Duke Energy Florida, LLC 2.50% 2029 | 3,795 | 3,818 | ||||||
| Edison International 3.55% 2024 | 3,650 | 3,680 | ||||||
| Edison International 4.125% 2028 | 6,932 | 7,014 | ||||||
| Edison International 3.13%–5.75% 2022–2027 | 1,193 | 1,244 | ||||||
| FirstEnergy Corp. 3.90% 2027 | 4,050 | 4,344 | ||||||
| MidAmerican Energy Holdings Co. 3.65% 2029 | 6,130 | 6,734 | ||||||
| PacifiCorp., First Mortgage Bonds, 3.50% 2029 | 1,000 | 1,083 | ||||||
| Puget Energy, Inc. 6.50% 2020 | 5,000 | 5,224 | ||||||
| San Diego Gas & Electric Co. 3.75% 2047 | 5,531 | 5,761 | ||||||
| SCANA Corp. 4.13%–6.25% 2020–2022 | 3,908 | 3,962 | ||||||
| Southern California Edison Co. 4.125% 2048 | 3,180 | 3,410 | ||||||
| Southern California Edison Co. 2.85%–6.00% 2023–2045 | 8,792 | 9,536 | ||||||
| Virginia Electric and Power Co. 3.30%–4.00% 2046–2049 | 5,048 | 5,323 | ||||||
| Other securities | 52,440 | |||||||
| 114,598 | ||||||||
| Energy 12.69% | ||||||||
| Apache Corp. 4.25% 2030 | 3,695 | 3,686 | ||||||
| BP Capital Markets PLC 2.32%–4.23% 2020–2028 | 7,960 | 8,514 | ||||||
| Cheniere Energy, Inc. 3.70% 20293 | 4,689 | 4,740 | ||||||
| Chevron Corp. 2.954% 2026 | 3,360 | 3,536 | ||||||
| Energy Transfer Partners, LP 4.00%–6.25% 2027–2049 | 8,002 | 8,708 | ||||||
| Exxon Mobil Corp. 2.222% 2021 | 4,500 | 4,523 | ||||||
| Noble Energy, Inc. 3.25% 2029 | 3,755 | 3,727 | ||||||
| Occidental Petroleum Corp. 2.90% 2024 | 3,649 | 3,673 | ||||||
| Occidental Petroleum Corp. 3.50% 2029 | 3,409 | 3,445 | ||||||
| Occidental Petroleum Corp. 3.20%–4.85% 2021–2049 | 3,272 | 3,325 | ||||||
| Shell International Finance BV 2.00% 2024 | 3,680 | 3,664 | ||||||
| Shell International Finance BV 1.75%–4.00% 2021–2049 | 6,148 | 6,452 | ||||||
| Total Capital International 2.434% 2025 | 3,945 | 3,998 | ||||||
| Other securities | 45,841 | |||||||
| 107,832 | ||||||||
| Health care 11.40% | ||||||||
| AbbVie Inc. 3.20% 20293 | 4,100 | 4,168 | ||||||
| AbbVie Inc. 4.25% 20493 | 4,072 | 4,295 | ||||||
| AbbVie Inc. 2.30%–4.88% 2020–20483 | 5,505 | 5,757 | ||||||
| Allergan PLC 3.45% 2022 | 3,584 | 3,662 | ||||||
| Shire PLC 2.40%–3.20% 2021–2026 | 4,131 | 4,240 | ||||||
| Takeda Pharmaceutical Co., Ltd. 4.40% 20233 | 2,455 | 2,639 | ||||||
| Takeda Pharmaceutical Co., Ltd. 5.00% 20283 | 4,378 | 5,112 | ||||||
| Teva Pharmaceutical Finance Co. BV 2.80% 2023 | 5,365 | 4,855 | ||||||
| Other securities | 62,178 | |||||||
| 96,906 | ||||||||
| American Funds Corporate Bond Fund | 5 |
| Bonds, notes & other debt instruments (continued) | Principal amount (000) | Value (000) | ||||||
| Corporate bonds & notes (continued) | ||||||||
| Consumer staples 8.57% | ||||||||
| Altria Group, Inc. 4.80% 2029 | $ | 4,310 | $ | 4,769 | ||||
| Altria Group, Inc. 5.95% 2049 | 4,252 | 5,122 | ||||||
| Altria Group, Inc. 3.80%–5.80% 2024–2039 | 613 | 665 | ||||||
| Anheuser-Busch Co./InBev Worldwide 4.90% 2046 | 3,740 | 4,494 | ||||||
| Anheuser-Busch InBev NV 4.00%–5.55% 2025–2049 | 4,624 | 5,645 | ||||||
| British American Tobacco PLC 3.557% 2027 | 4,683 | 4,775 | ||||||
| British American Tobacco PLC 2.76%–4.76% 2022–2049 | 9,630 | 9,581 | ||||||
| Reynolds American Inc. 4.45%–5.85% 2025–2045 | 450 | 496 | ||||||
| Wal-Mart Stores, Inc. 2.35%–3.70% 2021–2028 | 9,913 | 10,223 | ||||||
| Other securities | 27,110 | |||||||
| 72,880 | ||||||||
| Industrials 7.11% | ||||||||
| Honeywell International Inc. 2.30% 2024 | 3,525 | 3,571 | ||||||
| Northrop Grumman Corp. 2.55% 2022 | 3,560 | 3,610 | ||||||
| Other securities | 53,206 | |||||||
| 60,387 | ||||||||
| Information technology 5.24% | ||||||||
| Broadcom Inc. 4.75% 20293 | 7,800 | 8,348 | ||||||
| Broadcom Ltd. 3.00%–3.88% 2022–2028 | 5,909 | 5,966 | ||||||
| Fiserv, Inc. 3.50% 2029 | 5,515 | 5,803 | ||||||
| Other securities | 24,383 | |||||||
| 44,500 | ||||||||
| Communication services 4.30% | ||||||||
| AT&T Inc. 2.45% 2020 | 9,000 | 9,014 | ||||||
| CCO Holdings LLC and CCO Holdings Capital Corp. 5.125% 2049 | 4,187 | 4,536 | ||||||
| CCO Holdings LLC and CCO Holdings Capital Corp. 3.58%–5.75% 2020–2050 | 3,940 | 4,201 | ||||||
| Comcast Corp. 2.65% 2030 | 5,530 | 5,573 | ||||||
| Comcast Corp. 3.25%–4.70% 2025–2050 | 4,945 | 5,560 | ||||||
| Other securities | 7,682 | |||||||
| 36,566 | ||||||||
| Consumer discretionary 3.50% | ||||||||
| Other securities | 29,772 | |||||||
| Real estate 3.50% | ||||||||
| Equinix, Inc. 3.20% 2029 | 3,495 | 3,512 | ||||||
| Equinix, Inc. 2.63%–2.90% 2024–2026 | 5,148 | 5,155 | ||||||
| Westfield Corp. Ltd. 3.15% 20223 | 4,585 | 4,678 | ||||||
| Other securities | 16,380 | |||||||
| 29,725 | ||||||||
| Materials 2.19% | ||||||||
| ArcelorMittal 3.60% 2024 | 4,481 | 4,565 | ||||||
| Other securities | 14,070 | |||||||
| 18,635 | ||||||||
| Total corporate bonds & notes | 743,519 | |||||||
| 6 | American Funds Corporate Bond Fund |
| Principal amount (000) | Value (000) | |||||||
| U.S. Treasury bonds & notes 7.40% | ||||||||
| U.S. Treasury 7.24% | ||||||||
| U.S. Treasury 1.375% 2022 | $ | 7,600 | $ | 7,552 | ||||
| U.S. Treasury 1.25% 2024 | 4,410 | 4,335 | ||||||
| U.S. Treasury 1.50% 2024 | 5,996 | 5,962 | ||||||
| U.S. Treasury 1.625% 2029 | 3,797 | 3,742 | ||||||
| U.S. Treasury 1.75% 2029 | 20,355 | 20,309 | ||||||
| U.S. Treasury 2.25% 20494 | 11,402 | 11,519 | ||||||
| U.S. Treasury 1.50%–3.13% 2021–20484 | 8,097 | 8,114 | ||||||
| 61,533 | ||||||||
| U.S. Treasury inflation-protected securities 0.16% | ||||||||
| U.S. Treasury Inflation-Protected Security 0.25% 20295 | 1,330 | 1,342 | ||||||
| Total U.S. Treasury bonds & notes | 62,875 | |||||||
| Other bonds & notes 0.35% | ||||||||
| Other securities | 2,948 | |||||||
| Total bonds, notes & other debt instruments (cost: $779,441,000) | 809,342 | |||||||
| Short-term securities 4.31% | Shares | |||||||
| Money market investments 4.31% | ||||||||
| Capital Group Central Cash Fund 1.78%6 | 366,050 | 36,605 | ||||||
| Total short-term securities (cost: $36,605,000) | 36,605 | |||||||
| Total investment securities 99.54% (cost: $816,046,000) | 845,947 | |||||||
| Other assets less liabilities 0.46% | 3,929 | |||||||
| Net assets 100.00% | $ | 849,876 | ||||||
This summary investment portfolio is designed to streamline the report and help investors better focus on the fund’s principal holdings. See the inside back cover for details on how to obtain a complete schedule of portfolio holdings.
“Other securities” includes all issues that are not disclosed separately in the summary investment portfolio.
| American Funds Corporate Bond Fund | 7 |
Futures contracts
| Contracts | Type | Number of contracts | Expiration | Notional amount7 (000) | Value at 11/30/20198 (000) | Unrealized (depreciation) appreciation at 11/30/2019 (000) | ||||||||||||
| 2 Year U.S. Treasury Note Futures | Long | 112 | April 2020 | $ | 22,400 | $ | 24,146 | $ | (5 | ) | ||||||||
| 5 Year U.S. Treasury Note Futures | Long | 571 | April 2020 | 57,100 | 67,931 | (33 | ) | |||||||||||
| 10 Year U.S. Treasury Note Futures | Short | 35 | March 2020 | (3,500 | ) | (4,528 | ) | 14 | ||||||||||
| 10 Year Ultra U.S. Treasury Note Futures | Short | 118 | March 2020 | (11,800 | ) | (16,782 | ) | 25 | ||||||||||
| 20 Year U.S. Treasury Bond Futures | Long | 2 | March 2020 | 200 | 318 | (1 | ) | |||||||||||
| 30 Year Ultra U.S. Treasury Bond Futures | Long | 37 | March 2020 | 3,700 | 6,946 | 27 | ||||||||||||
| $ | 27 | |||||||||||||||||
The following footnotes apply to either the individual securities noted or one or more of the securities aggregated and listed as a single line item.
| 1 | Coupon rate may change periodically. |
| 2 | Step bond; coupon rate may change at a later date. |
| 3 | Acquired in a transaction exempt from registration under Rule 144A of the Securities Act of 1933. May be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. The total value of all such securities, including those in “Other securities,” was $118,180,000, which represented 13.91% of the net assets of the fund. |
| 4 | All or a portion of this security was pledged as collateral. The total value of pledged collateral was $484,000, which represented .06% of the net assets of the fund. |
| 5 | Index-linked bond whose principal amount moves with a government price index. |
| 6 | Rate represents the seven-day yield at 11/30/2019. |
| 7 | Notional amount is calculated based on the number of contracts and notional contract size. |
| 8 | Value is calculated based on the notional amount and current market price. |
Key to abbreviations and symbol
LIBOR = London Interbank Offered Rate
SOFR = Secured Overnight Financing Rate
USD/$ = U.S. dollars
See notes to financial statements.
| 8 | American Funds Corporate Bond Fund |
Financial statements
| Statement of assets and liabilities at November 30, 2019 |
unaudited (dollars in thousands) |
| Assets: | ||||||||
| Investment securities in unaffiliated issuers, at value (cost: $816,046) | $ | 845,947 | ||||||
| Cash | 46 | |||||||
| Receivables for: | ||||||||
| Sales of investments | $ | 8,638 | ||||||
| Sales of fund’s shares | 4,593 | |||||||
| Dividends and interest | 6,368 | |||||||
| Variation margin on futures contracts | 43 | 19,642 | ||||||
| 865,635 | ||||||||
| Liabilities: | ||||||||
| Payables for: | ||||||||
| Purchases of investments | 13,909 | |||||||
| Repurchases of fund’s shares | 1,305 | |||||||
| Dividends on fund’s shares | 11 | |||||||
| Investment advisory services | 256 | |||||||
| Services provided by related parties | 252 | |||||||
| Trustees’ deferred compensation | 3 | |||||||
| Variation margin on futures contracts | 16 | |||||||
| Other | 7 | 15,759 | ||||||
| Net assets at November 30, 2019 | $ | 849,876 | ||||||
| Net assets consist of: | ||||||||
| Capital paid in on shares of beneficial interest | $ | 807,876 | ||||||
| Total distributable earnings | 42,000 | |||||||
| Net assets at November 30, 2019 | $ | 849,876 |
See notes to financial statements.
| American Funds Corporate Bond Fund | 9 |
(dollars and shares in thousands, except per-share amounts)
Shares of beneficial interest issued and outstanding (no
stated par value) —
unlimited shares authorized (77,933 total shares outstanding)
| Net assets | Shares outstanding | Net asset value per share | ||||||||||
| Class A | $ | 655,230 | 60,084 | $ | 10.91 | |||||||
| Class C | 27,189 | 2,493 | 10.91 | |||||||||
| Class T | 11 | 1 | 10.91 | |||||||||
| Class F-1 | 8,081 | 741 | 10.91 | |||||||||
| Class F-2 | 52,097 | 4,777 | 10.91 | |||||||||
| Class F-3 | 20,115 | 1,845 | 10.91 | |||||||||
| Class 529-A | 42,383 | 3,886 | 10.91 | |||||||||
| Class 529-C | 6,575 | 603 | 10.91 | |||||||||
| Class 529-E | 1,405 | 129 | 10.91 | |||||||||
| Class 529-T | 12 | 1 | 10.91 | |||||||||
| Class 529-F-1 | 4,691 | 430 | 10.91 | |||||||||
| Class R-1 | 1,711 | 157 | 10.91 | |||||||||
| Class R-2 | 5,572 | 511 | 10.91 | |||||||||
| Class R-2E | 801 | 74 | 10.91 | |||||||||
| Class R-3 | 7,576 | 695 | 10.91 | |||||||||
| Class R-4 | 3,503 | 321 | 10.91 | |||||||||
| Class R-5E | 766 | 70 | 10.91 | |||||||||
| Class R-5 | 1,441 | 132 | 10.91 | |||||||||
| Class R-6 | 10,717 | 983 | 10.91 | |||||||||
See notes to financial statements.
| 10 | American Funds Corporate Bond Fund |
| Statement of operations for the six months ended November 30, 2019 |
unaudited (dollars in thousands) |
| Investment income: | ||||||||
| Income: | ||||||||
| Interest | $ | 11,582 | ||||||
| Dividends | 611 | $ | 12,193 | |||||
| Fees and expenses*: | ||||||||
| Investment advisory services | 1,378 | |||||||
| Distribution services | 1,129 | |||||||
| Transfer agent services | 413 | |||||||
| Administrative services | 106 | |||||||
| Reports to shareholders | 34 | |||||||
| Registration statement and prospectus | 212 | |||||||
| Trustees’ compensation | 1 | |||||||
| Auditing and legal | 90 | |||||||
| Custodian | 3 | |||||||
| Other | 1 | |||||||
| Total fees and expenses before reimbursements | 3,367 | |||||||
| Less miscellaneous fee reimbursements | 78 | |||||||
| Total fees and expenses after reimbursements | 3,289 | |||||||
| Net investment income | 8,904 | |||||||
| Net realized gain and unrealized appreciation: | ||||||||
| Net realized gain on: | ||||||||
| Investments in unaffiliated issuers | 16,375 | |||||||
| Futures contracts | 1,058 | 17,433 | ||||||
| Net unrealized appreciation (depreciation) on: | ||||||||
| Investments in unaffiliated issuers | 13,691 | |||||||
| Futures contracts | (311 | ) | 13,380 | |||||
| Net realized gain and unrealized appreciation | 30,813 | |||||||
| Net increase in net assets resulting from operations | $ | 39,717 |
| * | Additional information related to class-specific fees and expenses is included in the notes to financial statements. |
See notes to financial statements.
| American Funds Corporate Bond Fund | 11 |
| Statements of changes in net assets | |
| (dollars in thousands) | |
| Six months ended November 30, 2019* | Year ended May 31, 2019 | |||||||
| Operations: | ||||||||
| Net investment income | $ | 8,904 | $ | 14,990 | ||||
| Net realized gain (loss) | 17,433 | (1,931 | ) | |||||
| Net unrealized appreciation | 13,380 | 26,622 | ||||||
| Net increase in net assets resulting from operations | 39,717 | 39,681 | ||||||
| Distributions paid or accrued to shareholders | (8,852 | ) | (14,837 | ) | ||||
| Net capital share transactions | 175,791 | 110,113 | ||||||
| Total increase in net assets | 206,656 | 134,957 | ||||||
| Net assets: | ||||||||
| Beginning of period | 643,220 | 508,263 | ||||||
| End of period | $ | 849,876 | $ | 643,220 | ||||
| * | Unaudited. |
See notes to financial statements.
| 12 | American Funds Corporate Bond Fund |
| Notes to financial statements | unaudited |
1. Organization
American Funds Corporate Bond Fund (the “fund”) is registered under the Investment Company Act of 1940 as an open-end, diversified management investment company. The fund seeks to provide maximum total return consistent with capital preservation and prudent risk management.
The fund has 19 share classes consisting of six retail share classes (Classes A, C, T, F-1, F-2 and F-3), five 529 college savings plan share classes (Classes 529-A, 529-C, 529-E, 529-T and 529-F-1) and eight retirement plan share classes (Classes R-1, R-2, R-2E, R-3, R-4, R-5E, R-5 and R-6). The 529 college savings plan share classes can be used to save for college education. The retirement plan share classes are generally offered only through eligible employer-sponsored retirement plans. The fund’s share classes are described further in the following table:
| Share class | Initial sales charge |
Contingent deferred sales charge upon redemption |
Conversion feature | ||||
| Classes A and 529-A | Up to 3.75% | None (except 1% for certain redemptions within 18 months of purchase without an initial sales charge) | None | ||||
| Class C | None | 1% for redemptions within one year of purchase | Class C converts to Class F-1 after 10 years | ||||
| Class 529-C | None | 1% for redemptions within one year of purchase | Class 529-C converts to Class 529-A after 10 years | ||||
| Class 529-E | None | None | None | ||||
| Classes T and 529-T* | Up to 2.50% | None | None | ||||
| Classes F-1, F-2, F-3 and 529-F-1 | None | None | None | ||||
| Classes R-1, R-2, R-2E, R-3, R-4, R-5E, R-5 and R-6 | None | None | None |
| * | Class T and 529-T shares are not available for purchase. |
Holders of all share classes have equal pro rata rights to the assets, dividends and liquidation proceeds of the fund. Each share class has identical voting rights, except for the exclusive right to vote on matters affecting only its class. Share classes have different fees and expenses (“class-specific fees and expenses”), primarily due to different arrangements for distribution, transfer agent and administrative services. Differences in class-specific fees and expenses will result in differences in net investment income and, therefore, the payment of different per-share dividends by each share class.
| American Funds Corporate Bond Fund | 13 |
2. Significant accounting policies
The fund is an investment company that applies the accounting and reporting guidance issued in Topic 946 by the U.S. Financial Accounting Standards Board. The fund’s financial statements have been prepared to comply with U.S. generally accepted accounting principles (“U.S. GAAP”). These principles require the fund’s investment adviser to make estimates and assumptions that affect reported amounts and disclosures. Actual results could differ from those estimates. Subsequent events, if any, have been evaluated through the date of issuance in the preparation of the financial statements. The fund follows the significant accounting policies described in this section, as well as the valuation policies described in the next section on valuation.
Security transactions and related investment income — Security transactions are recorded by the fund as of the date the trades are executed with brokers. Realized gains and losses from security transactions are determined based on the specific identified cost of the securities. In the event a security is purchased with a delayed payment date, the fund will segregate liquid assets sufficient to meet its payment obligations. Dividend income is recognized on the ex-dividend date and interest income is recognized on an accrual basis. Market discounts, premiums and original issue discounts on fixed-income securities are amortized daily over the expected life of the security.
Class allocations — Income, fees and expenses (other than class-specific fees and expenses) are allocated daily among the various share classes based on the relative value of their settled shares. Realized and unrealized gains and losses are allocated daily among the various share classes based on their relative net assets. Class-specific fees and expenses, such as distribution, transfer agent and administrative services, are charged directly to the respective share class.
Distributions paid or accrued to shareholders — Income dividends are declared daily after the determination of the fund’s net investment income and are paid to shareholders monthly. Capital gain distributions are recorded on the ex-dividend date.
3. Valuation
Capital Research and Management Company (“CRMC”), the fund’s investment adviser, values the fund’s investments at fair value as defined by U.S. GAAP. The net asset value of each share class of the fund is generally determined as of approximately 4:00 p.m. New York time each day the New York Stock Exchange is open.
Methods and inputs — The fund’s investment adviser uses the following methods and inputs to establish the fair value of the fund’s assets and liabilities. Use of particular methods and inputs may vary over time based on availability and relevance as market and economic conditions evolve.
Fixed-income securities, including short-term securities, are generally valued at prices obtained from one or more pricing vendors. Vendors value such securities based on one or more of the inputs described in the following table. The table provides examples of
| 14 | American Funds Corporate Bond Fund |
inputs that are commonly relevant for valuing particular classes of fixed-income securities in which the fund is authorized to invest. However, these classifications are not exclusive, and any of the inputs may be used to value any other class of fixed-income security.
| Fixed-income class | Examples of standard inputs | |
| All | Benchmark yields, transactions, bids, offers, quotations from dealers and trading systems, new issues, spreads and other relationships observed in the markets among comparable securities; and proprietary pricing models such as yield measures calculated using factors such as cash flows, financial or collateral performance and other reference data (collectively referred to as “standard inputs”) | |
| Corporate bonds & notes; convertible securities | Standard inputs and underlying equity of the issuer | |
| Bonds & notes of governments & government agencies | Standard inputs and interest rate volatilities | |
| Mortgage-backed; asset-backed obligations | Standard inputs and cash flows, prepayment information, default rates, delinquency and loss assumptions, collateral characteristics, credit enhancements and specific deal information | |
| Municipal securities | Standard inputs and, for certain distressed securities, cash flows or liquidation values using a net present value calculation based on inputs that include, but are not limited to, financial statements and debt contracts |
When the fund’s investment adviser deems it appropriate to do so (such as when vendor prices are unavailable or deemed to be not representative), fixed-income securities will be valued in good faith at the mean quoted bid and ask prices that are reasonably and timely available (or bid prices, if ask prices are not available) or at prices for securities of comparable maturity, quality and type. The Capital Group Central Cash Fund (“CCF”), a fund within the Capital Group Central Fund Series (“Central Funds”), is valued based upon a floating net asset value, which fluctuates with changes in the value of CCF’s portfolio securities. The underlying securities are valued based on the policies and procedures in CCF’s statement of additional information.
Exchange-traded futures are generally valued at the official settlement price of the exchange or market on which such instruments are traded, as of the close of business on the day the futures are being valued.
Securities and other assets for which representative market quotations are not readily available or are considered unreliable by the fund’s investment adviser are fair valued as determined in good faith under fair valuation guidelines adopted by authority of the fund’s board of trustees as further described. The investment adviser follows fair valuation guidelines, consistent with U.S. Securities and Exchange Commission rules and guidance, to consider relevant principles and factors when making fair value determinations. The investment adviser considers relevant indications of value that are reasonably and timely available to it in determining the fair value to be assigned to a particular security, such as the type and cost of the security; contractual or legal restrictions on resale of the security;
| American Funds Corporate Bond Fund | 15 |
relevant financial or business developments of the issuer; actively traded similar or related securities; conversion or exchange rights on the security; related corporate actions; significant events occurring after the close of trading in the security; and changes in overall market conditions. In addition, the closing prices of equity securities that trade in markets outside U.S. time zones may be adjusted to reflect significant events that occur after the close of local trading but before the net asset value of each share class of the fund is determined. Fair valuations and valuations of investments that are not actively trading involve judgment and may differ materially from valuations that would have been used had greater market activity occurred.
Processes and structure — The fund’s board of trustees has delegated authority to the fund’s investment adviser to make fair value determinations, subject to board oversight. The investment adviser has established a Joint Fair Valuation Committee (the “Fair Valuation Committee”) to administer, implement and oversee the fair valuation process, and to make fair value decisions. The Fair Valuation Committee regularly reviews its own fair value decisions, as well as decisions made under its standing instructions to the investment adviser’s valuation teams. The Fair Valuation Committee reviews changes in fair value measurements from period to period and may, as deemed appropriate, update the fair valuation guidelines to better reflect the results of back testing and address new or evolving issues. The Fair Valuation Committee reports any changes to the fair valuation guidelines to the board of trustees. The fund’s board and audit committee also regularly review reports that describe fair value determinations and methods.
The fund’s investment adviser has also established a Fixed-Income Pricing Review Group to administer and oversee the fixed-income valuation process, including the use of fixed-income pricing vendors. This group regularly reviews pricing vendor information and market data. Pricing decisions, processes and controls over security valuation are also subject to additional internal reviews, including an annual control self-evaluation program facilitated by the investment adviser’s compliance group.
Classifications — The fund’s investment adviser classifies the fund’s assets and liabilities into three levels based on the inputs used to value the assets or liabilities. Level 1 values are based on quoted prices in active markets for identical securities. Level 2 values are based on significant observable market inputs, such as quoted prices for similar securities and quoted prices in inactive markets. Certain securities trading outside the U.S. may transfer between Level 1 and Level 2 due to valuation adjustments resulting from significant market movements following the close of local trading. Level 3 values are based on significant unobservable inputs that reflect the investment adviser’s determination of assumptions that market participants might reasonably use in valuing the securities. The valuation levels are not necessarily an indication of the risk or liquidity associated with the underlying investment. For example, U.S. government securities are
| 16 | American Funds Corporate Bond Fund |
reflected as Level 2 because the inputs used to determine fair value may not always be quoted prices in an active market. The following tables present the fund’s valuation levels as of November 30, 2019 (dollars in thousands):
| Investment securities | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Assets: | ||||||||||||||||
| Bonds, notes & other debt instruments: | ||||||||||||||||
| Corporate bonds & notes | $ | — | $ | 743,519 | $ | — | $ | 743,519 | ||||||||
| U.S. Treasury bonds & notes | — | 62,875 | — | 62,875 | ||||||||||||
| Other | — | 2,948 | — | 2,948 | ||||||||||||
| Short-term securities | 36,605 | — | — | 36,605 | ||||||||||||
| Total | $ | 36,605 | $ | 809,342 | $ | — | $ | 845,947 | ||||||||
| Other investments* | ||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | |||||||||||||
| Assets: | ||||||||||||||||
| Unrealized appreciation on futures contracts | $ | 66 | $ | — | $ | — | $ | 66 | ||||||||
| Liabilities: | ||||||||||||||||
| Unrealized depreciation on futures contracts | (39 | ) | — | — | (39 | ) | ||||||||||
| Total | $ | 27 | $ | — | $ | — | $ | 27 | ||||||||
| * | Futures contracts are not included in the investment portfolio. |
4. Risk factors
Investing in the fund may involve certain risks including, but not limited to, those described below.
Market conditions — The prices of, and the income generated by, the securities held by the fund may decline – sometimes rapidly or unpredictably – due to various factors, including events or conditions affecting the general economy or particular industries; overall market changes; local, regional or global political, social or economic instability; governmental, governmental agency or central bank responses to economic conditions; and currency exchange rate, interest rate and commodity price fluctuations.
Issuer risks — The prices of, and the income generated by, securities held by the fund may decline in response to various factors directly related to the issuers of such securities, including reduced demand for an issuer’s goods or services, poor management performance, major litigation related to the issuer, changes in government regulations affecting the issuer or its competitive environment and strategic initiatives such as mergers, acquisitions or dispositions and the market response to any such initiatives.
| American Funds Corporate Bond Fund | 17 |
Investing in debt instruments — The prices of, and the income generated by, bonds and other debt securities held by the fund may be affected by changing interest rates and by changes in the effective maturities and credit ratings of these securities.
Rising interest rates will generally cause the prices of bonds and other debt securities to fall. A general rise in interest rates may cause investors to sell debt securities on a large scale, which could also adversely affect the price and liquidity of debt securities and could also result in increased redemptions from the fund. Falling interest rates may cause an issuer to redeem, call or refinance a debt security before its stated maturity, which may result in the fund failing to recoup the full amount of its initial investment and having to reinvest the proceeds in lower yielding securities. Longer maturity debt securities generally have greater sensitivity to changes in interest rates and may be subject to greater price fluctuations than shorter maturity debt securities.
Bonds and other debt securities are also subject to credit risk, which is the possibility that the credit strength of an issuer or guarantor will weaken or be perceived to be weaker, and/or an issuer of a debt security will fail to make timely payments of principal or interest and the security will go into default. A downgrade or default affecting any of the fund’s securities could cause the value of the fund’s shares to decrease. Lower quality debt securities generally have higher rates of interest and may be subject to greater price fluctuations than higher quality debt securities. Credit risk is gauged, in part, by the credit ratings of the debt securities in which the fund invests. However, ratings are only the opinions of the rating agencies issuing them and are not guarantees as to credit quality or an evaluation of market risk. The fund’s investment adviser relies on its own credit analysts to research issuers and issues in seeking to assess credit and default risks.
Investing in securities backed by the U.S. government — Securities backed by the U.S. Treasury or the full faith and credit of the U.S. government are guaranteed only as to the timely payment of interest and principal when held to maturity. Accordingly, the current market values for these securities will fluctuate with changes in interest rates and the credit rating of the U.S. government. Securities issued by government-sponsored entities and federal agencies and instrumentalities that are not backed by the full faith and credit of the U.S. government are neither issued nor guaranteed by the U.S. government.
Investing in derivatives — The use of derivatives involves a variety of risks, which may be different from, or greater than, the risks associated with investing in traditional securities, such as stocks and bonds. Changes in the value of a derivative may not correlate perfectly with, and may be more sensitive to market events than, the underlying asset, rate or index, and a derivative instrument may expose the fund to losses in excess of its initial investment. Derivatives may be difficult to value, difficult for the fund to buy or sell at an opportune time or price and difficult, or even impossible, to terminate or otherwise offset. The fund’s use of derivatives may result in losses to the fund, and investing in derivatives may reduce the fund’s returns and increase the fund’s price volatility. The fund’s counterparty to a derivative transaction (including, if applicable, the fund’s clearing broker, the derivatives exchange or the clearinghouse) may be unable or unwilling to
| 18 | American Funds Corporate Bond Fund |
honor its financial obligations in respect of the transaction. In certain cases, the fund may be hindered or delayed in exercising remedies against or closing out derivative instruments with a counterparty, which may result in additional losses.
Liquidity risk — Certain fund holdings may be or become difficult or impossible to sell, particularly during times of market turmoil. Liquidity may be impacted by the lack of an active market for a holding, legal or contractual restrictions on resale, or the reduced number and capacity of market participants to make a market in such holding. Market prices for less liquid or illiquid holdings may be volatile, and reduced liquidity may have an adverse impact on the market price of such holdings. Additionally, the sale of less liquid or illiquid holdings may involve substantial delays (including delays in settlement) and additional costs and the fund may be unable to sell such holdings when necessary to meet its liquidity needs or may be forced to sell at a loss.
Investing outside the U.S. — Securities of issuers domiciled outside the U.S., or with significant operations or revenues outside the U.S., may lose value because of adverse political, social, economic or market developments (including social instability, regional conflicts, terrorism and war) in the countries or regions in which the issuers operate or generate revenue. These securities may also lose value due to changes in foreign currency exchange rates against the U.S. dollar and/or currencies of other countries. Issuers of these securities may be more susceptible to actions of foreign governments, such as nationalization, currency blockage or the imposition of price controls or punitive taxes, each of which could adversely impact the value of these securities. Securities markets in certain countries may be more volatile and/or less liquid than those in the United States. Investments outside the U.S. may also be subject to different accounting practices and different regulatory, legal and reporting standards and practices, and may be more difficult to value, than those in the United States. In addition, the value of investments outside the U.S. may be reduced by foreign taxes, including foreign withholding taxes on interest and dividends. Further, there may be increased risks of delayed settlement of securities purchased or sold by the fund. The risks of investing outside the U.S. may be heightened in connection with investments in emerging markets.
Investing in emerging markets — Investing in emerging markets may involve risks in addition to and greater than those generally associated with investing in the securities markets of developed countries. For instance, emerging market countries may have less developed legal and accounting systems than those in developed countries. The governments of these countries may be less stable and more likely to impose capital controls, nationalize a company or industry, place restrictions on foreign ownership and on withdrawing sale proceeds of securities from the country, and/or impose punitive taxes that could adversely affect the prices of securities. In addition, the economies of these countries may be dependent on relatively few industries that are more susceptible to local and global changes. Securities markets in these countries can also be relatively small and have substantially lower trading volumes. As a result, securities issued in these countries may be more volatile and less liquid, and may be more difficult to value, than securities issued in countries with more developed economies and/or markets. Less certainty with respect to security valuations may lead to additional challenges and risks in
| American Funds Corporate Bond Fund | 19 |
calculating the fund’s net asset value. Additionally, emerging markets are more likely to experience problems with the clearing and settling of trades and the holding of securities by banks, agents and depositories that are less established than those in developed countries.
Management — The investment adviser to the fund actively manages the fund’s investments. Consequently, the fund is subject to the risk that the methods and analyses, including models, tools and data, employed by the investment adviser in this process may be flawed or incorrect and may not produce the desired results. This could cause the fund to lose value or its investment results to lag relevant benchmarks or other funds with similar objectives.
5. Certain investment techniques
Index-linked bonds — The fund has invested in index-linked bonds, which are fixed-income securities whose principal value is periodically adjusted to a government price index. Over the life of an index-linked bond, interest is paid on the adjusted principal value. Increases or decreases in the principal value of index-linked bonds are recorded as interest income in the fund’s statement of operations.
Futures contracts — The fund has entered into futures contracts, which provide for the future sale by one party and purchase by another party of a specified amount of a specific financial instrument for a specified price, date, time and place designated at the time the contract is made. Futures contracts are used to strategically manage the fund’s interest rate sensitivity by increasing or decreasing the duration of the fund or a portion of the fund’s portfolio.
Upon entering into futures contracts, and to maintain the fund’s open positions in futures contracts, the fund is required to deposit with a futures broker, known as a futures commission merchant (“FCM”), in a segregated account in the name of the FCM an amount of cash, U.S. government securities or other liquid securities, known as initial margin. The margin required for a particular futures contract is set by the exchange on which the contract is traded to serve as collateral, and may be significantly modified from time to time by the exchange during the term of the contract. Securities deposited as initial margin, if any, are disclosed in the investment portfolio and cash deposited as initial margin, if any, is reflected as cash pledged for futures contracts in the fund’s statement of assets and liabilities.
On a daily basis, the fund pays or receives variation margin based on the increase or decrease in the value of the futures contracts and records variation margin on futures contracts in the statement of assets and liabilities. In addition, the fund segregates liquid assets equivalent to the fund’s outstanding obligations under the contract in excess of the initial margin and variation margin, if any. Futures contracts may involve a risk of loss in excess of the variation margin shown on the fund’s statement of assets and liabilities. The fund records realized gains or losses at the time the futures contract is closed or expires.
| 20 | American Funds Corporate Bond Fund |
Net realized gains or losses and net unrealized appreciation or depreciation from futures contracts are recorded in the fund’s statement of operations. The average month-end notional amount of futures contracts while held was $35,567,000.
The following tables identify the location and fair value amounts on the fund’s statement of assets and liabilities and the effect on the fund’s statement of operations resulting from the fund’s use of futures contracts as of, or for the six months ended, November 30, 2019 (dollars in thousands):
| Assets | Liabilities | |||||||||||||
| Contracts | Risk type | Location on statement of assets and liabilities | Value | Location on statement of assets and liabilities | Value | |||||||||
| Futures | Interest | Unrealized appreciation* | $ | 66 | Unrealized depreciation* | $ | 39 | |||||||
| Net realized gain | Net unrealized depreciation | |||||||||||||
| Contracts | Risk type | Location on statement of operations | Value | Location on statement of operations | Value | |||||||||
| Futures | Interest | Net realized gain on futures contracts | $ | 1,058 | Net unrealized depreciation on futures contracts | $ | (311 | ) | ||||||
| * | Includes cumulative appreciation/depreciation on futures contracts as reported in the applicable table following the fund’s investment portfolio. Only current day’s variation margin is reported within the statement of assets and liabilities. |
Collateral — The fund participates in a collateral program due to its use of futures contracts that calls for the fund to pledge highly liquid assets, such as cash or U.S. government securities, as collateral for initial and variation margin by contract. The purpose of the collateral is to cover potential losses that could occur in the event that either party cannot meet its contractual obligation. Non-cash collateral pledged by the fund, if any, is disclosed in the fund’s investment portfolio, and cash collateral pledged by the fund, if any, is held in a segregated account with the fund’s custodian, which is reflected as pledged cash in the fund’s statement of assets and liabilities.
6. Taxation and distributions
Federal income taxation — The fund complies with the requirements under Subchapter M of the Internal Revenue Code applicable to mutual funds and intends to distribute substantially all of its net taxable income and net capital gains each year. The fund is not subject to income taxes to the extent such distributions are made. Therefore, no federal income tax provision is required.
As of and during the period ended November 30, 2019, the fund did not have a liability for any unrecognized tax benefits. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the statement of operations. During the period, the fund did not incur any significant interest or penalties.
| American Funds Corporate Bond Fund | 21 |
The fund’s tax returns are not subject to examination by federal, state and, if applicable, non-U.S. tax authorities after the expiration of each jurisdiction’s statute of limitations, which is generally three years after the date of filing but can be extended in certain jurisdictions.
Non-U.S. taxation — Dividend and interest income are recorded net of non-U.S. taxes paid. The fund may file withholding tax reclaims in certain jurisdictions to recover a portion of amounts previously withheld. These reclaims are recorded when the amount is known and there are no significant uncertainties on collectability. Gains realized by the fund on the sale of securities in certain countries, if any, may be subject to non-U.S. taxes. If applicable, the fund records an estimated deferred tax liability based on unrealized gains to provide for potential non-U.S. taxes payable upon the sale of these securities.
Distributions — Distributions paid to shareholders are based on net investment income and net realized gains determined on a tax basis, which may differ from net investment income and net realized gains for financial reporting purposes. These differences are due primarily to different treatment for items such as short-term capital gains and losses; capital losses related to sales of certain securities within 30 days of purchase; cost of investments sold; net capital losses and income on certain investments. The fiscal year in which amounts are distributed may differ from the year in which the net investment income and net realized gains are recorded by the fund for financial reporting purposes.
The components of distributable earnings on a tax basis are reported as of the fund’s most recent year-end. As of May 31, 2019, the components of distributable earnings on a tax basis were as follows (dollars in thousands):
| Undistributed ordinary income | $ | 299 | ||
| Capital loss carryforward* | (4,609 | ) |
| * | The capital loss carryforward will be used to offset any capital gains realized by the fund in the current year or in subsequent years. The fund will not make distributions from capital gains while a capital loss carryforward remains. |
As of November 30, 2019, the tax basis unrealized appreciation (depreciation) and cost of investments were as follows (dollars in thousands):
| Gross unrealized appreciation on investments | $ | 30,393 | ||
| Gross unrealized depreciation on investments | (750 | ) | ||
| Net unrealized appreciation on investments | 29,643 | |||
| Cost of investments | 816,331 |
| 22 | American Funds Corporate Bond Fund |
Tax-basis distributions paid or accrued to shareholders from ordinary income were as follows (dollars in thousands):
| Share class | Six months ended November 30, 2019 | Year ended May 31, 2019 | ||||||
| Class A | $ | 6,844 | $ | 11,867 | ||||
| Class C | 199 | 346 | ||||||
| Class T | — | * | — | * | ||||
| Class F-1 | 86 | 162 | ||||||
| Class F-2 | 614 | 905 | ||||||
| Class F-3 | 214 | 287 | ||||||
| Class 529-A | 431 | 695 | ||||||
| Class 529-C | 51 | 95 | ||||||
| Class 529-E | 13 | 24 | ||||||
| Class 529-T | — | * | — | * | ||||
| Class 529-F-1 | 56 | 94 | ||||||
| Class R-1 | 11 | 9 | ||||||
| Class R-2 | 43 | 78 | ||||||
| Class R-2E | 6 | 9 | ||||||
| Class R-3 | 77 | 129 | ||||||
| Class R-4 | 40 | 55 | ||||||
| Class R-5E | 9 | 11 | ||||||
| Class R-5 | 15 | 27 | ||||||
| Class R-6 | 143 | 44 | ||||||
| Total | $ | 8,852 | $ | 14,837 | ||||
| * | Amount less than one thousand. |
7. Fees and transactions with related parties
CRMC, the fund’s investment adviser, is the parent company of American Funds Distributors®, Inc. (“AFD”), the principal underwriter of the fund’s shares, and American Funds Service Company® (“AFS”), the fund’s transfer agent. CRMC, AFD and AFS are considered related parties to the fund.
Investment advisory services — The fund has an investment advisory and service agreement with CRMC that provides for monthly fees accrued daily. These fees are based on an annual rate of 0.377% of daily net assets. For the six months ended November 30, 2019, the investment advisory services fee was $1,378,000.
Miscellaneous fee reimbursements — CRMC has agreed to reimburse a portion of miscellaneous fees and expenses of the fund. This reimbursement may be adjusted or discontinued by CRMC, subject to any restrictions in the fund’s prospectus. For the six months ended November 30, 2019, total fees and expenses reimbursed by CRMC were $78,000. Fees and expenses in the statement of operations are presented gross of any reimbursements from CRMC.
| American Funds Corporate Bond Fund | 23 |
Class-specific fees and expenses — Expenses that are specific to individual share classes are accrued directly to the respective share class. The principal class-specific fees and expenses are further described below:
Distribution services — The fund has plans of distribution for all share classes, except Class F-2, F-3, R-5E, R-5 and R-6 shares. Under the plans, the board of trustees approves certain categories of expenses that are used to finance activities primarily intended to sell fund shares and service existing accounts. The plans provide for payments, based on an annualized percentage of average daily net assets, ranging from 0.30% to 1.00% as noted in this section. In some cases, the board of trustees has limited the amounts that may be paid to less than the maximum allowed by the plans. All share classes with a plan may use up to 0.25% of average daily net assets to pay service fees, or to compensate AFD for paying service fees, to firms that have entered into agreements with AFD to provide certain shareholder services. The remaining amounts available to be paid under each plan are paid to dealers to compensate them for their sales activities.
| Share class | Currently approved limits | Plan limits | |||||||
| Class A | 0.30 | % | 0.30 | % | |||||
| Class 529-A | 0.30 | 0.50 | |||||||
| Classes C, 529-C and R-1 | 1.00 | 1.00 | |||||||
| Class R-2 | 0.75 | 1.00 | |||||||
| Class R-2E | 0.60 | 0.85 | |||||||
| Classes 529-E and R-3 | 0.50 | 0.75 | |||||||
| Classes T, F-1, 529-T, 529-F-1 and R-4 | 0.25 | 0.50 | |||||||
For Class A and 529-A shares, distribution-related expenses include the reimbursement of dealer and wholesaler commissions paid by AFD for certain shares sold without a sales charge. These share classes reimburse AFD for amounts billed within the prior 15 months but only to the extent that the overall annual expense limits are not exceeded. As of November 30, 2019, unreimbursed expenses subject to reimbursement totaled $47,000 for Class A shares. There were no unreimbursed expenses subject to reimbursement for Class 529-A shares.
Transfer agent services — The fund has a shareholder services agreement with AFS under which the fund compensates AFS for providing transfer agent services to each of the fund’s share classes. These services include recordkeeping, shareholder communications and transaction processing. In addition, the fund reimburses AFS for amounts paid to third parties for performing transfer agent services on behalf of fund shareholders.
Administrative services — The fund has an administrative services agreement with CRMC under which the fund compensates CRMC for providing administrative services to all share classes. Administrative services are provided by CRMC and its affiliates to help assist third parties providing non-distribution services to fund shareholders. These services include providing in depth information on the fund and
| 24 | American Funds Corporate Bond Fund |
market developments that impact fund investments. Administrative services also include, but are not limited to, coordinating, monitoring and overseeing third parties that provide services to fund shareholders. The agreement provides the fund the ability to charge an administrative services fee at the annual rate of 0.05% of the daily net assets attributable to each share class of the fund. Prior to July 1, 2019, Class A shares paid CRMC an administrative services fee at the annual rate of 0.01% of daily net assets and all other share classes paid a fee at the annual rate of 0.05% of their respective daily net assets. The fund’s board of trustees authorized the fund to pay CRMC effective July 1, 2019, an administrative services fee at the annual rate of 0.03% of the average daily net assets attributable to each share class of the fund (which could increase as noted above) for CRMC’s provision of administrative services.
529 plan services — Each 529 share class is subject to service fees to compensate the Virginia College Savings Plan (“Virginia529”) for its oversight and administration of the CollegeAmerica 529 college savings plan. The fee is based on the combined net assets invested in Class 529 and ABLE shares of the American Funds. Class ABLE shares are offered on other American Funds by Virginia529 through ABLEAmerica®, a tax-advantaged savings program for individuals with disabilities. The quarterly fee is based on a series of decreasing annual rates beginning with 0.10% on the first $20 billion of the combined net assets invested in the American Funds and decreasing to 0.03% on such assets in excess of $100 billion. The fee for any given calendar quarter is accrued and calculated on the basis of the average net assets of Class 529 and ABLE shares of the American Funds for the last month of the prior calendar quarter. The fee is included in other expenses in the fund’s statement of operations. Virginia529 is not considered a related party to the fund.
| American Funds Corporate Bond Fund | 25 |
For the six months ended November 30, 2019, class-specific expenses under the agreements were as follows (dollars in thousands):
| Share class | Distribution services | Transfer agent services |
Administrative services |
529 plan services |
||||||||||||
| Class A | $867 | $326 | $ 78 | Not applicable | ||||||||||||
| Class C | 119 | 13 | 4 | Not applicable | ||||||||||||
| Class T | — | — | * | — | * | Not applicable | ||||||||||
| Class F-1 | 9 | 5 | 1 | Not applicable | ||||||||||||
| Class F-2 | Not applicable | 25 | 8 | Not applicable | ||||||||||||
| Class F-3 | Not applicable | 1 | 2 | Not applicable | ||||||||||||
| Class 529-A | 50 | 19 | 6 | $12 | ||||||||||||
| Class 529-C | 32 | 3 | 1 | 2 | ||||||||||||
| Class 529-E | 3 | — | * | — | * | — | * | |||||||||
| Class 529-T | — | — | * | — | * | — | * | |||||||||
| Class 529-F-1 | — | 2 | 1 | 2 | ||||||||||||
| Class R-1 | 6 | — | * | — | * | Not applicable | ||||||||||
| Class R-2 | 19 | 9 | 1 | Not applicable | ||||||||||||
| Class R-2E | 2 | 1 | — | * | Not applicable | |||||||||||
| Class R-3 | 18 | 6 | 1 | Not applicable | ||||||||||||
| Class R-4 | 4 | 2 | 1 | Not applicable | ||||||||||||
| Class R-5E | Not applicable | 1 | — | * | Not applicable | |||||||||||
| Class R-5 | Not applicable | — | * | — | * | Not applicable | ||||||||||
| Class R-6 | Not applicable | — | * | 2 | Not applicable | |||||||||||
| Total class-specific expenses | $1,129 | $413 | $106 | $16 | ||||||||||||
| * | Amount less than one thousand. |
Trustees’ deferred compensation — Trustees who are unaffiliated with CRMC may elect to defer the cash payment of part or all of their compensation. These deferred amounts, which remain as liabilities of the fund, are treated as if invested in shares of the fund or other American Funds. These amounts represent general, unsecured liabilities of the fund and vary according to the total returns of the selected funds. Trustees’ compensation in the fund’s statement of operations reflects the current fees (either paid in cash or deferred) and a net increase or decrease in the value of the deferred amounts.
Affiliated officers and trustees — Officers and certain trustees of the fund are or may be considered to be affiliated with CRMC, AFD and AFS. No affiliated officers or trustees received any compensation directly from the fund.
Investment in CCF — The fund holds shares of CCF, an institutional prime money market fund managed by CRMC. CCF invests in high-quality, short-term money market instruments. CCF is used as the primary investment vehicle for the fund’s short-term investments. CCF shares are only available for purchase by CRMC, its affiliates, and other funds managed by CRMC and are not available to the public. CRMC does not receive an investment advisory services fee from CCF.
| 26 | American Funds Corporate Bond Fund |
Security transactions with related funds — The fund may purchase securities from, or sell securities to, other funds managed by CRMC (or funds managed by certain affiliates of CRMC) under procedures adopted by the fund’s board of trustees. The funds involved in such transactions are considered related by virtue of having a common investment adviser (or affiliated investment advisers), common trustees and/or common officers. When such transactions occur, each transaction is executed at the current market price of the security and no brokerage commissions or fees are paid in accordance with Rule 17a-7 of the 1940 Act.
Interfund lending — Pursuant to an exemptive order issued by the SEC, the fund, along with other CRMC-managed funds (or funds managed by certain affiliates of CRMC), may participate in an interfund lending program. The program provides an alternate credit facility that permits the funds to lend or borrow cash for temporary purposes directly to or from one another, subject to the conditions of the exemptive order. The fund did not lend or borrow cash through the interfund lending program at any time during the six months ended November 30, 2019.
8. Capital share transactions
Capital share transactions in the fund were as follows (dollars and shares in thousands):
| Sales* | Reinvestments of distributions | Repurchases* | Net increase | |||||||||||||||||||||||||||||
| Share class | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | ||||||||||||||||||||||||
| Six months ended November 30, 2019 | ||||||||||||||||||||||||||||||||
| Class A | $ | 165,164 | 15,297 | $ | 6,793 | 627 | $ | (41,863 | ) | (3,879 | ) | $ | 130,094 | 12,045 | ||||||||||||||||||
| Class C | 8,502 | 788 | 198 | 18 | (2,661 | ) | (247 | ) | 6,039 | 559 | ||||||||||||||||||||||
| Class T | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
| Class F-1 | 2,640 | 245 | 86 | 8 | (1,064 | ) | (98 | ) | 1,662 | 155 | ||||||||||||||||||||||
| Class F-2 | 25,458 | 2,360 | 611 | 56 | (14,214 | ) | (1,315 | ) | 11,855 | 1,101 | ||||||||||||||||||||||
| Class F-3 | 9,506 | 882 | 214 | 20 | (1,463 | ) | (135 | ) | 8,257 | 767 | ||||||||||||||||||||||
| Class 529-A | 12,789 | 1,186 | 430 | 39 | (3,309 | ) | (307 | ) | 9,910 | 918 | ||||||||||||||||||||||
| Class 529-C | 1,398 | 129 | 51 | 5 | (1,131 | ) | (104 | ) | 318 | 30 | ||||||||||||||||||||||
| Class 529-E | 436 | 40 | 13 | 1 | (155 | ) | (14 | ) | 294 | 27 | ||||||||||||||||||||||
| Class 529-T | — | — | — | † | — | † | — | — | — | † | — | † | ||||||||||||||||||||
| Class 529-F-1 | 987 | 92 | 56 | 5 | (439 | ) | (41 | ) | 604 | 56 | ||||||||||||||||||||||
| Class R-1 | 1,107 | 103 | 10 | 1 | (32 | ) | (3 | ) | 1,085 | 101 | ||||||||||||||||||||||
| Class R-2 | 1,132 | 105 | 43 | 4 | (456 | ) | (43 | ) | 719 | 66 | ||||||||||||||||||||||
| Class R-2E | 338 | 31 | 6 | 1 | (72 | ) | (6 | ) | 272 | 26 | ||||||||||||||||||||||
| Class R-3 | 1,412 | 131 | 76 | 7 | (902 | ) | (83 | ) | 586 | 55 | ||||||||||||||||||||||
| Class R-4 | 434 | 40 | 40 | 4 | (158 | ) | (15 | ) | 316 | 29 | ||||||||||||||||||||||
| Class R-5E | 172 | 16 | 8 | 1 | (19 | ) | (2 | ) | 161 | 15 | ||||||||||||||||||||||
| Class R-5 | 446 | 41 | 14 | 1 | (97 | ) | (9 | ) | 363 | 33 | ||||||||||||||||||||||
| Class R-6 | 5,171 | 490 | 143 | 13 | (2,058 | ) | (192 | ) | 3,256 | 311 | ||||||||||||||||||||||
| Total net increase (decrease) | $ | 237,092 | 21,976 | $ | 8,792 | 811 | $ | (70,093 | ) | (6,493 | ) | $ | 175,791 | 16,294 | ||||||||||||||||||
See next page for footnotes.
| American Funds Corporate Bond Fund | 27 |
| Sales* | Reinvestments of distributions | Repurchases* | Net increase (decrease) | |||||||||||||||||||||||||||||
| Share class | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | ||||||||||||||||||||||||
| Year ended May 31, 2019 | ||||||||||||||||||||||||||||||||
| Class A | $ | 163,813 | 16,284 | $ | 11,712 | 1,165 | $ | (100,766 | ) | (10,091 | ) | $ | 74,759 | 7,358 | ||||||||||||||||||
| Class C | 9,685 | 961 | 340 | 34 | (7,272 | ) | (727 | ) | 2,753 | 268 | ||||||||||||||||||||||
| Class T | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
| Class F-1 | 2,847 | 282 | 161 | 16 | (6,611 | ) | (663 | ) | (3,603 | ) | (365 | ) | ||||||||||||||||||||
| Class F-2 | 25,663 | 2,555 | 901 | 89 | (15,685 | ) | (1,573 | ) | 10,879 | 1,071 | ||||||||||||||||||||||
| Class F-3 | 5,110 | 508 | 283 | 28 | (2,432 | ) | (243 | ) | 2,961 | 293 | ||||||||||||||||||||||
| Class 529-A | 12,434 | 1,234 | 690 | 69 | (5,978 | ) | (600 | ) | 7,146 | 703 | ||||||||||||||||||||||
| Class 529-C | 2,719 | 270 | 95 | 9 | (1,418 | ) | (142 | ) | 1,396 | 137 | ||||||||||||||||||||||
| Class 529-E | 487 | 48 | 24 | 2 | (414 | ) | (41 | ) | 97 | 9 | ||||||||||||||||||||||
| Class 529-T | — | — | — | † | — | † | — | — | — | † | — | † | ||||||||||||||||||||
| Class 529-F-1 | 2,589 | 260 | 92 | 9 | (1,416 | ) | (143 | ) | 1,265 | 126 | ||||||||||||||||||||||
| Class R-1 | 406 | 40 | 8 | 1 | (116 | ) | (11 | ) | 298 | 30 | ||||||||||||||||||||||
| Class R-2 | 2,583 | 257 | 77 | 8 | (1,449 | ) | (144 | ) | 1,211 | 121 | ||||||||||||||||||||||
| Class R-2E | 379 | 38 | 9 | 1 | (191 | ) | (20 | ) | 197 | 19 | ||||||||||||||||||||||
| Class R-3 | 2,966 | 296 | 129 | 13 | (655 | ) | (66 | ) | 2,440 | 243 | ||||||||||||||||||||||
| Class R-4 | 1,314 | 129 | 55 | 5 | (195 | ) | (19 | ) | 1,174 | 115 | ||||||||||||||||||||||
| Class R-5E | 522 | 52 | 11 | 1 | (24 | ) | (2 | ) | 509 | 51 | ||||||||||||||||||||||
| Class R-5 | 447 | 45 | 26 | 3 | (158 | ) | (16 | ) | 315 | 32 | ||||||||||||||||||||||
| Class R-6 | 6,536 | 637 | 43 | 4 | (263 | ) | (26 | ) | 6,316 | 615 | ||||||||||||||||||||||
| Total net increase (decrease) | $ | 240,500 | 23,896 | $ | 14,656 | 1,457 | $ | (145,043 | ) | (14,527 | ) | $ | 110,113 | 10,826 | ||||||||||||||||||
| * | Includes exchanges between share classes of the fund. |
| † | Amount less than one thousand. |
| 28 | American Funds Corporate Bond Fund |
9. Investment transactions
The fund made purchases and sales of investment securities, excluding short-term securities and U.S. government obligations, if any, of $533,486,000 and $374,411,000, respectively, during the six months ended November 30, 2019.
| American Funds Corporate Bond Fund | 29 |
Financial highlights
| Income (loss) from investment operations1 | ||||||||||||||||
| Period ended | Net asset value, beginning of period | Net investment income | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | ||||||||||||
| Class A: | ||||||||||||||||
| 11/30/20195,6 | $ | 10.44 | $ | .13 | $ | .47 | $ | .60 | ||||||||
| 5/31/2019 | 10.00 | .28 | .44 | .72 | ||||||||||||
| 5/31/2018 | 10.33 | .24 | (.30 | ) | (.06 | ) | ||||||||||
| 5/31/2017 | 10.27 | .22 | .18 | .40 | ||||||||||||
| 5/31/2016 | 10.20 | .30 | .26 | .56 | ||||||||||||
| 5/31/2015 | 10.11 | .26 | .08 | .34 | ||||||||||||
| Class C: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .09 | .47 | .56 | ||||||||||||
| 5/31/2019 | 10.00 | .20 | .44 | .64 | ||||||||||||
| 5/31/2018 | 10.33 | .16 | (.30 | ) | (.14 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .12 | (.18 | ) | (.06 | ) | ||||||||||
| Class T: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .14 | .47 | .61 | ||||||||||||
| 5/31/2019 | 10.00 | .30 | .44 | .74 | ||||||||||||
| 5/31/2018 | 10.33 | .26 | (.30 | ) | (.04 | ) | ||||||||||
| 5/31/20175,12 | 10.17 | .04 | .16 | .20 | ||||||||||||
| Class F-1: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .13 | .47 | .60 | ||||||||||||
| 5/31/2019 | 10.00 | .28 | .44 | .72 | ||||||||||||
| 5/31/2018 | 10.33 | .23 | (.30 | ) | (.07 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .18 | (.18 | ) | — | 13 | ||||||||||
| Class F-2: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .14 | .47 | .61 | ||||||||||||
| 5/31/2019 | 10.00 | .30 | .44 | .74 | ||||||||||||
| 5/31/2018 | 10.33 | .26 | (.30 | ) | (.04 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .20 | (.17 | ) | .03 | |||||||||||
| Class F-3: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .15 | .47 | .62 | ||||||||||||
| 5/31/2019 | 10.00 | .31 | .44 | .75 | ||||||||||||
| 5/31/2018 | 10.33 | .27 | (.30 | ) | (.03 | ) | ||||||||||
| 5/31/20175,14 | 10.09 | .09 | .24 | .33 | ||||||||||||
| 30 | American Funds Corporate Bond Fund |
| Dividends and distributions | ||||||||||||||||||||||||||||||||||
| Dividends (from net investment income) | Distributions (from capital gains) | Total dividends and distributions | Net asset value, end of period | Total return2,3 | Net assets, end of period (in millions) | Ratio of expenses to average net assets before reimburse- ments4 | Ratio of expenses to average net assets after reimburse- ments3,4 | Ratio of net income to average net assets3 | ||||||||||||||||||||||||||
| $ | (.13 | ) | $ | — | $ | (.13 | ) | $ | 10.91 | 5.74 | %7 | $ | 655 | .89 | %8 | .87 | %8 | 2.38 | %8 | |||||||||||||||
| (.28 | ) | — | (.28 | ) | 10.44 | 7.32 | 501 | .95 | .94 | 2.80 | ||||||||||||||||||||||||
| (.24 | ) | (.03 | ) | (.27 | ) | 10.00 | (.64 | ) | 407 | 1.03 | .90 | 2.37 | ||||||||||||||||||||||
| (.23 | ) | (.11 | ) | (.34 | ) | 10.33 | 3.90 | 9 | 211 | .98 | 9 | .87 | 9 | 2.16 | 9 | |||||||||||||||||||
| (.29 | ) | (.20 | ) | (.49 | ) | 10.27 | 5.71 | 9 | 52 | .75 | 9 | .53 | 9 | 2.97 | 9 | |||||||||||||||||||
| (.25 | ) | — | (.25 | ) | 10.20 | 3.44 | 9 | 51 | .71 | 9 | .53 | 9 | 2.52 | 9 | ||||||||||||||||||||
| (.09 | ) | — | (.09 | ) | 10.91 | 5.37 | 7 | 27 | 1.59 | 8 | 1.57 | 8 | 1.67 | 8 | ||||||||||||||||||||
| (.20 | ) | — | (.20 | ) | 10.44 | 6.53 | 20 | 1.70 | 1.69 | 2.05 | ||||||||||||||||||||||||
| (.16 | ) | (.03 | ) | (.19 | ) | 10.00 | (1.41 | ) | 17 | 1.81 | 1.68 | 1.58 | ||||||||||||||||||||||
| (.11 | ) | (.07 | ) | (.18 | ) | 10.33 | (.47 | )7 | 10 | 1.77 | 1.64 | 1.40 | ||||||||||||||||||||||
| (.14 | ) | — | (.14 | ) | 10.91 | 5.90 | 7,9 | — | 11 | .60 | 8,9 | .58 | 8,9 | 2.68 | 8,9 | |||||||||||||||||||
| (.30 | ) | — | (.30 | ) | 10.44 | 7.60 | 9 | — | 11 | .69 | 9 | .68 | 9 | 3.06 | 9 | |||||||||||||||||||
| (.26 | ) | (.03 | ) | (.29 | ) | 10.00 | (.40 | )9 | — | 11 | .83 | 9 | .68 | 9 | 2.56 | 9 | ||||||||||||||||||
| (.04 | ) | — | (.04 | ) | 10.33 | 1.97 | 7,9 | — | 11 | .15 | 7,9 | .10 | 7,9 | .37 | 7,9 | |||||||||||||||||||
| (.13 | ) | — | (.13 | ) | 10.91 | 5.75 | 7 | 8 | .87 | 8 | .85 | 8 | 2.40 | 8 | ||||||||||||||||||||
| (.28 | ) | — | (.28 | ) | 10.44 | 7.30 | 6 | .98 | .97 | 2.77 | ||||||||||||||||||||||||
| (.23 | ) | (.03 | ) | (.26 | ) | 10.00 | (.69 | ) | 9 | 1.05 | .94 | 2.35 | ||||||||||||||||||||||
| (.17 | ) | (.07 | ) | (.24 | ) | 10.33 | .09 | 7 | 2 | 1.14 | 1.00 | 2.07 | ||||||||||||||||||||||
| (.14 | ) | — | (.14 | ) | 10.91 | 5.90 | 7 | 52 | .59 | 8 | .57 | 8 | 2.68 | 8 | ||||||||||||||||||||
| (.30 | ) | — | (.30 | ) | 10.44 | 7.60 | 38 | .69 | .67 | 3.07 | ||||||||||||||||||||||||
| (.26 | ) | (.03 | ) | (.29 | ) | 10.00 | (.41 | ) | 26 | .76 | .66 | 2.64 | ||||||||||||||||||||||
| (.20 | ) | (.07 | ) | (.27 | ) | 10.33 | .33 | 7 | 5 | .77 | .66 | 2.35 | ||||||||||||||||||||||
| (.15 | ) | — | (.15 | ) | 10.91 | 5.95 | 7 | 20 | .49 | 8 | .47 | 8 | 2.77 | 8 | ||||||||||||||||||||
| (.31 | ) | — | (.31 | ) | 10.44 | 7.72 | 11 | .59 | .57 | 3.17 | ||||||||||||||||||||||||
| (.27 | ) | (.03 | ) | (.30 | ) | 10.00 | (.32 | ) | 8 | .71 | .58 | 2.69 | ||||||||||||||||||||||
| (.09 | ) | — | (.09 | ) | 10.33 | 3.29 | 7 | 3 | .32 | 7 | .20 | 7 | .89 | 7 | ||||||||||||||||||||
See end of table for footnotes.
| American Funds Corporate Bond Fund | 31 |
Financial highlights (continued)
| Income (loss) from investment operations1 | ||||||||||||||||
| Period ended | Net asset value, beginning of period | Net investment income | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | ||||||||||||
| Class 529-A: | ||||||||||||||||
| 11/30/20195,6 | $ | 10.44 | $ | .13 | $ | .47 | $ | .60 | ||||||||
| 5/31/2019 | 10.00 | .28 | .44 | .72 | ||||||||||||
| 5/31/2018 | 10.33 | .23 | (.30 | ) | (.07 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .17 | (.17 | ) | — | 13 | ||||||||||
| Class 529-C: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .09 | .47 | .56 | ||||||||||||
| 5/31/2019 | 10.00 | .20 | .44 | .64 | ||||||||||||
| 5/31/2018 | 10.33 | .15 | (.30 | ) | (.15 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .12 | (.18 | ) | (.06 | ) | ||||||||||
| Class 529-E: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .12 | .47 | .59 | ||||||||||||
| 5/31/2019 | 10.00 | .26 | .44 | .70 | ||||||||||||
| 5/31/2018 | 10.33 | .21 | (.30 | ) | (.09 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .16 | (.17 | ) | (.01 | ) | ||||||||||
| Class 529-T: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .14 | .47 | .61 | ||||||||||||
| 5/31/2019 | 10.00 | .30 | .44 | .74 | ||||||||||||
| 5/31/2018 | 10.33 | .26 | (.30 | ) | (.04 | ) | ||||||||||
| 5/31/20175,12 | 10.17 | .04 | .16 | .20 | ||||||||||||
| Class 529-F-1: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .14 | .47 | .61 | ||||||||||||
| 5/31/2019 | 10.00 | .30 | .44 | .74 | ||||||||||||
| 5/31/2018 | 10.33 | .26 | (.30 | ) | (.04 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .20 | (.18 | ) | .02 | |||||||||||
| Class R-1: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .09 | .47 | .56 | ||||||||||||
| 5/31/2019 | 10.00 | .21 | .44 | .65 | ||||||||||||
| 5/31/2018 | 10.33 | .18 | (.30 | ) | (.12 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .18 | (.17 | ) | .01 | |||||||||||
| 32 | American Funds Corporate Bond Fund |
| Dividends and distributions | ||||||||||||||||||||||||||||||||||
| Dividends (from net investment income) | Distributions (from capital gains) | Total dividends and distributions | Net asset value, end of period | Total return2,3 | Net assets, end of period (in millions) | Ratio of expenses to average net assets before reimburse- ments4 | Ratio of expenses to average net assets after reimburse- ments3,4 | Ratio of net income to average net assets3 | ||||||||||||||||||||||||||
| $ | (.13 | ) | $ | — | $ | (.13 | ) | $ | 10.91 | 5.73 | %7 | $ | 42 | .92 | %8 | .90 | %8 | 2.35 | %8 | |||||||||||||||
| (.28 | ) | — | (.28 | ) | 10.44 | 7.33 | 31 | .95 | .94 | 2.80 | ||||||||||||||||||||||||
| (.23 | ) | (.03 | ) | (.26 | ) | 10.00 | (.73 | ) | 23 | 1.09 | .98 | 2.32 | ||||||||||||||||||||||
| (.17 | ) | (.07 | ) | (.24 | ) | 10.33 | .06 | 7 | 6 | 1.15 | 1.01 | 2.06 | ||||||||||||||||||||||
| (.09 | ) | — | (.09 | ) | 10.91 | 5.34 | 7 | 7 | 1.66 | 8 | 1.64 | 8 | 1.62 | 8 | ||||||||||||||||||||
| (.20 | ) | — | (.20 | ) | 10.44 | 6.47 | 6 | 1.75 | 1.74 | 2.00 | ||||||||||||||||||||||||
| (.15 | ) | (.03 | ) | (.18 | ) | 10.00 | (1.47 | ) | 4 | 1.86 | 1.74 | 1.53 | ||||||||||||||||||||||
| (.11 | ) | (.07 | ) | (.18 | ) | 10.33 | (.48 | )7 | 2 | 1.82 | 1.69 | 1.36 | ||||||||||||||||||||||
| (.12 | ) | — | (.12 | ) | 10.91 | 5.65 | 7 | 1 | 1.07 | 8 | 1.05 | 8 | 2.19 | 8 | ||||||||||||||||||||
| (.26 | ) | — | (.26 | ) | 10.44 | 7.09 | 1 | 1.17 | 1.16 | 2.58 | ||||||||||||||||||||||||
| (.21 | ) | (.03 | ) | (.24 | ) | 10.00 | (.90 | ) | 1 | 1.29 | 1.16 | 2.11 | ||||||||||||||||||||||
| (.16 | ) | (.07 | ) | (.23 | ) | 10.33 | (.02 | )7 | 1 | 1.27 | 1.13 | 1.93 | ||||||||||||||||||||||
| (.14 | ) | — | (.14 | ) | 10.91 | 5.88 | 7,9 | — | 11 | .65 | 8,9 | .63 | 8,9 | 2.63 | 8,9 | |||||||||||||||||||
| (.30 | ) | — | (.30 | ) | 10.44 | 7.52 | 9 | — | 11 | .76 | 9 | .75 | 9 | 3.00 | 9 | |||||||||||||||||||
| (.26 | ) | (.03 | ) | (.29 | ) | 10.00 | (.47 | )9 | — | 11 | .89 | 9 | .75 | 9 | 2.49 | 9 | ||||||||||||||||||
| (.04 | ) | — | (.04 | ) | 10.33 | 1.96 | 7,9 | — | 11 | .16 | 7,9 | .11 | 7,9 | .36 | 7,9 | |||||||||||||||||||
| (.14 | ) | — | (.14 | ) | 10.91 | 5.87 | 7 | 5 | .66 | 8 | .64 | 8 | 2.62 | 8 | ||||||||||||||||||||
| (.30 | ) | — | (.30 | ) | 10.44 | 7.54 | 4 | .75 | .73 | 3.02 | ||||||||||||||||||||||||
| (.26 | ) | (.03 | ) | (.29 | ) | 10.00 | (.48 | ) | 2 | .85 | .74 | 2.57 | ||||||||||||||||||||||
| (.19 | ) | (.07 | ) | (.26 | ) | 10.33 | .30 | 7 | 1 | .85 | .71 | 2.36 | ||||||||||||||||||||||
| (.09 | ) | — | (.09 | ) | 10.91 | 5.41 | 7 | 2 | 1.50 | 8 | 1.47 | 8 | 1.72 | 8 | ||||||||||||||||||||
| (.21 | ) | — | (.21 | ) | 10.44 | 6.64 | 1 | 1.59 | 1.57 | 2.18 | ||||||||||||||||||||||||
| (.18 | ) | (.03 | ) | (.21 | ) | 10.00 | (1.19 | )9 | — | 11 | 1.59 | 9 | 1.48 | 9 | 1.83 | 9 | ||||||||||||||||||
| (.18 | ) | (.07 | ) | (.25 | ) | 10.33 | .15 | 7,9 | — | 11 | 1.12 | 9 | .97 | 9 | 2.06 | 9 | ||||||||||||||||||
See end of table for footnotes.
| American Funds Corporate Bond Fund | 33 |
Financial highlights (continued)
| Income (loss) from investment operations1 | ||||||||||||||||
| Period ended | Net asset value, beginning of period | Net investment income | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | ||||||||||||
| Class R-2: | ||||||||||||||||
| 11/30/20195,6 | $ | 10.44 | $ | .09 | $ | .47 | $ | .56 | ||||||||
| 5/31/2019 | 10.00 | .21 | .44 | .65 | ||||||||||||
| 5/31/2018 | 10.33 | .17 | (.30 | ) | (.13 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .15 | (.17 | ) | (.02 | ) | ||||||||||
| Class R-2E: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .11 | .47 | .58 | ||||||||||||
| 5/31/2019 | 10.00 | .24 | .44 | .68 | ||||||||||||
| 5/31/2018 | 10.33 | .23 | (.30 | ) | (.07 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .20 | (.17 | ) | .03 | |||||||||||
| Class R-3: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .11 | .47 | .58 | ||||||||||||
| 5/31/2019 | 10.00 | .25 | .44 | .69 | ||||||||||||
| 5/31/2018 | 10.33 | .21 | (.30 | ) | (.09 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .17 | (.17 | ) | — | 13 | ||||||||||
| Class R-4: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .13 | .47 | .60 | ||||||||||||
| 5/31/2019 | 10.00 | .28 | .44 | .72 | ||||||||||||
| 5/31/2018 | 10.33 | .24 | (.30 | ) | (.06 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .20 | (.18 | ) | .02 | |||||||||||
| Class R-5E: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .14 | .47 | .61 | ||||||||||||
| 5/31/2019 | 10.00 | .30 | .44 | .74 | ||||||||||||
| 5/31/2018 | 10.33 | .27 | (.30 | ) | (.03 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .20 | (.17 | ) | .03 | |||||||||||
| Class R-5: | ||||||||||||||||
| 11/30/20195,6 | 10.44 | .15 | .47 | .62 | ||||||||||||
| 5/31/2019 | 10.00 | .31 | .44 | .75 | ||||||||||||
| 5/31/2018 | 10.33 | .27 | (.30 | ) | (.03 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .21 | (.18 | ) | .03 | |||||||||||
| 34 | American Funds Corporate Bond Fund |
| Dividends and distributions | ||||||||||||||||||||||||||||||||||
| Dividends (from net investment income) | Distributions (from capital gains) | Total dividends and distributions | Net asset value, end of period | Total return2,3 | Net assets, end of period (in millions) | Ratio of expenses to average net assets before reimburse- ments4 | Ratio of expenses to average net assets after reimburse- ments3,4 | Ratio of net income to average net assets3 | ||||||||||||||||||||||||||
| $ | (.09 | ) | $ | — | $ | (.09 | ) | $ | 10.91 | 5.38 | %7 | $ | 6 | 1.58 | %8 | 1.56 | %8 | 1.69 | %8 | |||||||||||||||
| (.21 | ) | — | (.21 | ) | 10.44 | 6.58 | 5 | 1.65 | 1.63 | 2.11 | ||||||||||||||||||||||||
| (.17 | ) | (.03 | ) | (.20 | ) | 10.00 | (1.35 | ) | 3 | 1.74 | 1.61 | 1.68 | ||||||||||||||||||||||
| (.15 | ) | (.07 | ) | (.22 | ) | 10.33 | (.11 | )7 | 1 | 1.64 | 1.39 | 1.75 | ||||||||||||||||||||||
| (.11 | ) | — | (.11 | ) | 10.91 | 5.55 | 7 | 1 | 1.27 | 8 | 1.25 | 8 | 2.00 | 8 | ||||||||||||||||||||
| (.24 | ) | — | (.24 | ) | 10.44 | 6.90 | — | 11 | 1.35 | 1.33 | 2.45 | |||||||||||||||||||||||
| (.23 | ) | (.03 | ) | (.26 | ) | 10.00 | (.73 | )9 | — | 11 | 1.32 | 9 | 1.22 | 9 | 2.16 | 9 | ||||||||||||||||||
| (.20 | ) | (.07 | ) | (.27 | ) | 10.33 | .36 | 7,9 | — | 11 | .75 | 9 | .63 | 9 | 2.33 | 9 | ||||||||||||||||||
| (.11 | ) | — | (.11 | ) | 10.91 | 5.61 | 7 | 8 | 1.14 | 8 | 1.12 | 8 | 2.13 | 8 | ||||||||||||||||||||
| (.25 | ) | — | (.25 | ) | 10.44 | 7.03 | 7 | 1.22 | 1.21 | 2.54 | ||||||||||||||||||||||||
| (.21 | ) | (.03 | ) | (.24 | ) | 10.00 | (.92 | ) | 4 | 1.28 | 1.18 | 2.16 | ||||||||||||||||||||||
| (.17 | ) | (.07 | ) | (.24 | ) | 10.33 | .10 | 7 | 1 | 1.29 | 1.11 | 2.02 | ||||||||||||||||||||||
| (.13 | ) | — | (.13 | ) | 10.91 | 5.77 | 7 | 3 | .84 | 8 | .82 | 8 | 2.43 | 8 | ||||||||||||||||||||
| (.28 | ) | — | (.28 | ) | 10.44 | 7.34 | 3 | .93 | .92 | 2.82 | ||||||||||||||||||||||||
| (.24 | ) | (.03 | ) | (.27 | ) | 10.00 | (.66 | ) | 2 | 1.05 | .92 | 2.36 | ||||||||||||||||||||||
| (.19 | ) | (.07 | ) | (.26 | ) | 10.33 | .26 | 7 | 1 | 1.15 | .85 | 2.31 | ||||||||||||||||||||||
| (.14 | ) | — | (.14 | ) | 10.91 | 5.87 | 7 | 1 | .65 | 8 | .63 | 8 | 2.62 | 8 | ||||||||||||||||||||
| (.30 | ) | — | (.30 | ) | 10.44 | 7.59 | 1 | .70 | .68 | 3.08 | ||||||||||||||||||||||||
| (.27 | ) | (.03 | ) | (.30 | ) | 10.00 | (.35 | ) | — | 11 | .81 | .61 | 2.66 | |||||||||||||||||||||
| (.20 | ) | (.07 | ) | (.27 | ) | 10.33 | .37 | 7 | — | 11 | .73 | .62 | 2.34 | |||||||||||||||||||||
| (.15 | ) | — | (.15 | ) | 10.91 | 5.93 | 7 | 1 | .54 | 8 | .52 | 8 | 2.73 | 8 | ||||||||||||||||||||
| (.31 | ) | — | (.31 | ) | 10.44 | 7.67 | 1 | .63 | .61 | 3.14 | ||||||||||||||||||||||||
| (.27 | ) | (.03 | ) | (.30 | ) | 10.00 | (.37 | ) | 1 | .74 | .62 | 2.67 | ||||||||||||||||||||||
| (.20 | ) | (.07 | ) | (.27 | ) | 10.33 | .34 | 7 | — | 11 | .81 | .63 | 2.42 | |||||||||||||||||||||
See end of table for footnotes.
| American Funds Corporate Bond Fund | 35 |
Financial highlights (continued)
| Income (loss) from investment operations1 | ||||||||||||||||
| Period ended | Net asset value, beginning of period | Net investment income | Net gains (losses) on securities (both realized and unrealized) | Total from investment operations | ||||||||||||
| Class R-6: | ||||||||||||||||
| 11/30/20195,6 | $ | 10.44 | $ | .15 | $ | .47 | $ | .62 | ||||||||
| 5/31/2019 | 10.00 | .31 | .44 | .75 | ||||||||||||
| 5/31/2018 | 10.33 | .27 | (.30 | ) | (.03 | ) | ||||||||||
| 5/31/20175,10 | 10.57 | .21 | (.19 | ) | .02 | |||||||||||
| Six months ended November 30, | Year ended May 31, | |||||||||||
| 20195,6,7 | 2019 | 2018 | 2017 | 2016 | 2015 | |||||||
| Portfolio turnover rate for all share classes15 | 93% | 203% | 153% | 162% | 295% | 204% | ||||||
See notes to financial statements.
| 36 | American Funds Corporate Bond Fund |
| Dividends and distributions | ||||||||||||||||||||||||||||||||||
| Dividends (from net investment income) | Distributions (from capital gains) | Total dividends and distributions | Net asset value, end of period | Total return2,3 | Net assets, end of period (in millions) | Ratio of expenses to average net assets before reimburse- ments4 | Ratio of expenses to average net assets after reimburse- ments3,4 | Ratio of net income to average net assets3 | ||||||||||||||||||||||||||
| $ | (.15 | ) | $ | — | $ | (.15 | ) | $ | 10.91 | 5.95 | %7 | $ | 11 | .50 | %8 | .47 | %8 | 2.79 | %8 | |||||||||||||||
| (.31 | ) | — | (.31 | ) | 10.44 | 7.70 | 7 | .60 | .58 | 3.21 | ||||||||||||||||||||||||
| (.27 | ) | (.03 | ) | (.30 | ) | 10.00 | (.36 | ) | 1 | .76 | .62 | 2.63 | ||||||||||||||||||||||
| (.19 | ) | (.07 | ) | (.26 | ) | 10.33 | .30 | 7 | 1 | .84 | .62 | 2.54 | ||||||||||||||||||||||
| 1 | Based on average shares outstanding. | |
| 2 | Total returns exclude any applicable sales charges, including contingent deferred sales charges. | |
| 3 | This column reflects the impact of a reimbursement from CRMC. During the periods shown, CRMC reimbursed a portion of miscellaneous fees and expenses. | |
| 4 | Ratios do not include expenses of any Central Funds. The fund indirectly bears its proportionate share of the expenses of any Central Funds. | |
| 5 | Based on operations for a period that is less than a full year. | |
| 6 | Unaudited. | |
| 7 | Not annualized. | |
| 8 | Annualized. | |
| 9 | All or a significant portion of assets in this class consisted of seed capital invested by CRMC and/or its affiliates. Fees for distribution services are not charged or accrued on these seed capital assets. If such fees were paid by the fund on seed capital assets, fund expenses would have been higher and net income and total return would have been lower. | |
| 10 | This share class began investment operations on July 29, 2016. | |
| 11 | Amount less than $1 million. | |
| 12 | Class T and 529-T shares began investment operations on April 7, 2017. | |
| 13 | Amount less than $.01. | |
| 14 | Class F-3 shares began investment operations on January 27, 2017. | |
| 15 | Rates do not include the fund’s portfolio activity with respect to any Central Funds. |
| American Funds Corporate Bond Fund | 37 |
| Expense example | unaudited |
As a fund shareholder, you incur two types of costs: (1) transaction costs, such as initial sales charges on purchase payments and contingent deferred sales charges on redemptions (loads), and (2) ongoing costs, including management fees, distribution and service (12b-1) fees, and other expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the fund so you can compare these costs with the ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire six-month period (June 1, 2019, through November 30, 2019).
Actual expenses:
The first line of each share class in the table on the following page provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading titled “Expenses paid during period” to estimate the expenses you paid on your account during this period.
Hypothetical example for comparison purposes:
The second line of each share class in the table on the following page provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio for the share class and an assumed rate of return of 5.00% per year before expenses, which is not the actual return of the share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the fund and other funds. To do so, compare this 5.00% hypothetical example with the 5.00% hypothetical examples that appear in the shareholder reports of the other funds.
Notes:
Retirement plan participants may be subject to certain fees charged by the plan sponsor, and Class F-1, F-2, F-3 and 529-F-1 shareholders may be subject to fees charged by financial intermediaries, typically ranging from 0.75% to 1.50% of assets annually depending on services offered. You can estimate the impact of these fees by adding the amount of the fees to the total estimated expenses you paid on your account during the period as calculated above. In addition, your ending account value would be lower by the amount of these fees.
Note that the expenses shown in the table on the following page are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads). Therefore, the second line of each share class in the table is useful in comparing ongoing costs only and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| 38 | American Funds Corporate Bond Fund |
Beginning account value | Ending account value | Expenses paid during period* | Annualized expense ratio |
|||||||||||||
| Class A – actual return | $ | 1,000.00 | $ | 1,057.43 | $ | 4.49 | .87 | % | ||||||||
| Class A – assumed 5% return | 1,000.00 | 1,020.71 | 4.41 | .87 | ||||||||||||
| Class C – actual return | 1,000.00 | 1,053.74 | 8.08 | 1.57 | ||||||||||||
| Class C – assumed 5% return | 1,000.00 | 1,017.20 | 7.94 | 1.57 | ||||||||||||
| Class T – actual return | 1,000.00 | 1,058.97 | 2.99 | .58 | ||||||||||||
| Class T – assumed 5% return | 1,000.00 | 1,022.16 | 2.94 | .58 | ||||||||||||
| Class F-1 – actual return | 1,000.00 | 1,057.54 | 4.38 | .85 | ||||||||||||
| Class F-1 – assumed 5% return | 1,000.00 | 1,020.81 | 4.31 | .85 | ||||||||||||
| Class F-2 – actual return | 1,000.00 | 1,059.00 | 2.94 | .57 | ||||||||||||
| Class F-2 – assumed 5% return | 1,000.00 | 1,022.21 | 2.89 | .57 | ||||||||||||
| Class F-3 – actual return | 1,000.00 | 1,059.52 | 2.43 | .47 | ||||||||||||
| Class F-3 – assumed 5% return | 1,000.00 | 1,022.71 | 2.38 | .47 | ||||||||||||
| Class 529-A – actual return | 1,000.00 | 1,057.26 | 4.64 | .90 | ||||||||||||
| Class 529-A – assumed 5% return | 1,000.00 | 1,020.56 | 4.56 | .90 | ||||||||||||
| Class 529-C – actual return | 1,000.00 | 1,053.42 | 8.44 | 1.64 | ||||||||||||
| Class 529-C – assumed 5% return | 1,000.00 | 1,016.85 | 8.29 | 1.64 | ||||||||||||
| Class 529-E – actual return | 1,000.00 | 1,056.46 | 5.41 | 1.05 | ||||||||||||
| Class 529-E – assumed 5% return | 1,000.00 | 1,019.80 | 5.32 | 1.05 | ||||||||||||
| Class 529-T – actual return | 1,000.00 | 1,058.78 | 3.25 | .63 | ||||||||||||
| Class 529-T – assumed 5% return | 1,000.00 | 1,021.91 | 3.19 | .63 | ||||||||||||
| Class 529-F-1 – actual return | 1,000.00 | 1,058.66 | 3.30 | .64 | ||||||||||||
| Class 529-F-1 – assumed 5% return | 1,000.00 | 1,021.86 | 3.24 | .64 | ||||||||||||
| Class R-1 – actual return | 1,000.00 | 1,054.09 | 7.57 | 1.47 | ||||||||||||
| Class R-1 – assumed 5% return | 1,000.00 | 1,017.70 | 7.44 | 1.47 | ||||||||||||
| Class R-2 – actual return | 1,000.00 | 1,053.81 | 8.03 | 1.56 | ||||||||||||
| Class R-2 – assumed 5% return | 1,000.00 | 1,017.25 | 7.89 | 1.56 | ||||||||||||
| Class R-2E – actual return | 1,000.00 | 1,055.46 | 6.44 | 1.25 | ||||||||||||
| Class R-2E – assumed 5% return | 1,000.00 | 1,018.80 | 6.33 | 1.25 | ||||||||||||
| Class R-3 – actual return | 1,000.00 | 1,056.13 | 5.77 | 1.12 | ||||||||||||
| Class R-3 – assumed 5% return | 1,000.00 | 1,019.45 | 5.67 | 1.12 | ||||||||||||
| Class R-4 – actual return | 1,000.00 | 1,057.69 | 4.23 | .82 | ||||||||||||
| Class R-4 – assumed 5% return | 1,000.00 | 1,020.96 | 4.15 | .82 | ||||||||||||
| Class R-5E – actual return | 1,000.00 | 1,058.70 | 3.25 | .63 | ||||||||||||
| Class R-5E – assumed 5% return | 1,000.00 | 1,021.91 | 3.19 | .63 | ||||||||||||
| Class R-5 – actual return | 1,000.00 | 1,059.26 | 2.68 | .52 | ||||||||||||
| Class R-5 – assumed 5% return | 1,000.00 | 1,022.46 | 2.64 | .52 | ||||||||||||
| Class R-6 – actual return | 1,000.00 | 1,059.55 | 2.43 | .47 | ||||||||||||
| Class R-6 – assumed 5% return | 1,000.00 | 1,022.71 | 2.38 | .47 | ||||||||||||
| * | The “expenses paid during period” are equal to the “annualized expense ratio,” multiplied by the average account value over the period, multiplied by the number of days in the period, and divided by 365 (to reflect the one-half year period). |
| American Funds Corporate Bond Fund | 39 |
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| 40 | American Funds Corporate Bond Fund |
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| American Funds Corporate Bond Fund | 41 |
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| American Funds Corporate Bond Fund | 43 |
Office of the fund
6455 Irvine Center Drive
Irvine, CA 92618-4518
Investment adviser
Capital Research and Management Company
333 South Hope Street
Los Angeles, CA 90071-1406
Transfer agent for shareholder accounts
American Funds Service Company
(Write to the address near you.)
P.O. Box 6007
Indianapolis, IN 46206-6007
P.O. Box 2280
Norfolk, VA 23501-2280
Custodian of assets
Bank of New York Mellon
One Wall Street
New York, NY 10286
Counsel
Morgan, Lewis & Bockius LLP
One Federal Street
Boston, MA 02110-1726
Independent registered public accounting firm
PricewaterhouseCoopers LLP
601 South Figueroa Street
Los Angeles, CA 90017-3874
Principal underwriter
American Funds Distributors, Inc.
333 South Hope Street
Los Angeles, CA 90071-1406
| 44 | American Funds Corporate Bond Fund |
Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectus and summary prospectus, which can be obtained from your financial professional and should be read carefully before investing. You may also call American Funds Service Company (AFS) at (800) 421-4225 or visit the Capital Group website at capitalgroup.com.
“American Funds Proxy Voting Procedures and Principles” — which describes how we vote proxies relating to portfolio securities — is available on our website or upon request by calling AFS. The fund files its proxy voting record with the U.S. Securities and Exchange Commission (SEC) for the 12 months ended June 30 by August 31. The proxy voting record is available free of charge on the SEC website at sec.gov and on our website.
A complete May 31, 2019, portfolio of American Funds Corporate Bond Fund’s investments is available free of charge by calling AFS or visiting the SEC website (where it is part of Form N-CSR).
American Funds Corporate Bond Fund files a complete list of its portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form NPORT-P. This filing is available free of charge on the SEC website. Additionally, the list of portfolio holdings is available by calling AFS.
This report is for the information of shareholders of American Funds Corporate Bond Fund, but it also may be used as sales literature when preceded or accompanied by the current prospectus or summary prospectus, which gives details about charges, expenses, investment objectives and operating policies of the fund. If used as sales material after March 31, 2020, this report must be accompanied by an American Funds statistical update for the most recently completed calendar quarter.
Bloomberg® is a trademark of Bloomberg Finance L.P. (collectively with its affiliates, “Bloomberg”). Barclays® is a trademark of Barclays Bank Plc (collectively with its affiliates, “Barclays”), used under license. Neither Bloomberg nor Barclays approves or endorses this material, guarantees the accuracy or completeness of any information herein and, to the maximum extent allowed by law, neither shall have any liability or responsibility for injury or damages arising in connection therewith.
American Funds Distributors, Inc., member FINRA.
The Capital Advantage®
Since 1931, Capital Group, home of American Funds, has helped investors pursue long-term investment success. Our consistent approach — in combination with The Capital SystemSM — has resulted in superior outcomes.
| Aligned with investor success | |
| We base our decisions on a long-term perspective, which we believe aligns our goals with the interests of our clients. Our portfolio managers average 27 years of investment experience, including 20 years at our company, reflecting a career commitment to our long-term approach.1 | |
| The Capital System | |
| The Capital System combines individual accountability with teamwork. Funds using The Capital System are divided into portions that are managed independently by investment professionals with diverse backgrounds, ages and investment approaches. An extensive global research effort is the backbone of our system. | |
| American Funds’ superior outcomes | |
| Equity funds have beaten their Lipper peer indexes in 92% of 10-year periods and 99% of 20-year periods.2 Fixed income funds have helped investors achieve diversification through attention to correlation between bonds and equities.3 Fund management fees have been among the lowest in the industry.4 | |
| 1 | Portfolio manager experience as of December 31, 2018. | |
| 2 | Based on Class F-2 share results for rolling periods through December 31, 2018. Periods covered are the shorter of the fund’s lifetime or since the comparable Lipper index inception date (except Capital Income Builder and SMALLCAP World Fund, for which the Lipper average was used). Expenses differ for each share class, so results will vary. | |
| 3 | Based on Class F-2 share results, as of December 31, 2018. Fourteen of our 15 American Funds fixed income funds that have been in existence for the three-year period showed a three-year correlation below 0.2. Standard & Poor’s 500 Composite Index was used as an equity market proxy. Correlation based on monthly total returns. Correlation is a statistical measure of how two securities move in relation to each other. A correlation ranges from –1 to 1. A positive correlation close to 1 implies that as one security moves, either up or down, the other security will move in “lockstep,” in the same direction. A negative correlation close to –1 indicates that the securities have moved in the opposite direction. | |
| 4 | On average, our management fees were in the lowest quintile 70% of the time, based on the 20-year period ended December 31, 2018, versus comparable Lipper categories, excluding funds of funds. | |
| Class F-2 shares were first offered on August 1, 2008. Class F-2 share results prior to the date of first sale are hypothetical based on the results of the original share class of the fund without a sales charge, adjusted for typical estimated expenses. Results for certain funds with an inception date after August 1, 2008, also include hypothetical returns because those funds’ Class F-2 shares sold after the funds’ date of first offering. Please see capitalgroup.com for more information on specific expense adjustments and the actual dates of first sale. |
All Capital Group trademarks mentioned are owned by The Capital Group Companies, Inc., an affiliated company or fund. All other company and product names mentioned are the property of their respective companies.
ITEM 2 – Code of Ethics
Not applicable for filing of semi-annual reports to shareholders.
ITEM 3 – Audit Committee Financial Expert
Not applicable for filing of semi-annual reports to shareholders.
ITEM 4 – Principal Accountant Fees and Services
Not applicable for filing of semi-annual reports to shareholders.
ITEM 5 – Audit Committee of Listed Registrants
Not applicable to this Registrant, insofar as the Registrant is not a listed issuer as defined in Rule 10A-3 under the Securities Exchange Act of 1934.
ITEM 6 – Schedule of Investments
American Funds Corporate
Bond Fund®
Investment portfolio
November 30, 2019
unaudited
| Bonds, notes & other debt instruments 95.23% Corporate bonds & notes 87.48% Financials 15.50% |
Principal amount (000) |
Value (000) |
| ACE INA Holdings Inc. 2.30% 2020 | $200 | $201 |
| ACE INA Holdings Inc. 2.875% 2022 | 1,205 | 1,239 |
| ACE INA Holdings Inc. 3.35% 2026 | 775 | 829 |
| Allstate Corp. 3.85% 2049 | 1,000 | 1,119 |
| American International Group, Inc. 3.90% 2026 | 300 | 322 |
| American International Group, Inc. 4.80% 2045 | 100 | 120 |
| AON Corp. 2.20% 2022 | 2,696 | 2,699 |
| Bank of America Corp. 3.55% 2024 (3-month USD-LIBOR + 0.78% on 3/5/2023)1 | 2,400 | 2,495 |
| Bank of America Corp. 3.458% 2025 (3-month USD-LIBOR + 0.97% on 3/15/2024)1 | 2,760 | 2,880 |
| Bank of America Corp. 3.419% 2028 (3-month USD-LIBOR + 1.04% on 12/20/2027)1 | 737 | 773 |
| Bank of America Corp. 2.884% 2030 (3-month USD-LIBOR + 1.19% on 10/22/2029)1 | 2,198 | 2,217 |
| Bank of Montreal 2.50% 2024 | 2,400 | 2,424 |
| Bank of Montreal 4.338% 2028 (USD Semi Annual 30/360 (vs. 3-month USD-LIBOR) 5 Year + 1.28% on 10/5/2023)1 |
1,865 | 1,966 |
| Barclays Bank PLC 4.95% 2047 | 600 | 691 |
| Berkshire Hathaway Finance Corp. 4.20% 2048 | 1,550 | 1,830 |
| Berkshire Hathaway Finance Corp. 4.25% 2049 | 300 | 357 |
| Berkshire Hathaway Inc. 3.125% 2026 | 1,350 | 1,423 |
| Berkshire Hathaway Inc. 4.50% 2043 | 125 | 153 |
| Citigroup Inc. 2.312% 2022 (USD-SOFR + 0.867% on 11/4/2021)1 | 2,000 | 2,004 |
| Citigroup Inc. 4.044% 2024 (3-month USD-LIBOR + 1.023% on 6/1/2023)1 | 750 | 792 |
| Citigroup Inc. 3.352% 2025 (3-month USD-LIBOR + 0.897% on 4/24/2024)1 | 1,000 | 1,037 |
| Citigroup Inc. 2.976% 2030 (USD-SOFR + 1.422% on 11/5/2029)1 | 2,857 | 2,891 |
| Citigroup Inc. 3.98% 2030 (3-month USD-LIBOR + 1.023% on 3/20/2029)1 | 675 | 736 |
| Cooperatieve Rabobank UA 2.625% 20242 | 1,200 | 1,214 |
| Crédit Agricole SA 3.25% 20242 | 600 | 620 |
| Crédit Agricole SA 4.375% 20252 | 480 | 514 |
| Credit Suisse Group AG 2.997% 2023 (3-month USD-LIBOR + 1.20% on 12/14/2022)1,2 | 650 | 660 |
| Credit Suisse Group AG 3.80% 2023 | 425 | 444 |
| Credit Suisse Group AG 2.593% 2025 (USD-SOFR + 1.56% on 9/11/2024)1,2 | 1,000 | 999 |
| Credit Suisse Group AG 4.55% 2026 | 500 | 556 |
| Credit Suisse Group AG 3.869% 2029 (3-month USD-LIBOR + 1.41% on 1/12/2028)1,2 | 500 | 535 |
| Danske Bank AS 2.70% 20222 | 200 | 201 |
| Ford Motor Credit Co. 5.584% 2024 | 425 | 455 |
| Ford Motor Credit Co. 4.542% 2026 | 1,025 | 1,031 |
| Goldman Sachs Group, Inc. (3-month USD-LIBOR + 0.80%) 2.927% 20193 |
3,750 | 3,751 |
| Goldman Sachs Group, Inc. 2.905% 2023 (3-month USD-LIBOR + 0.99% on 7/24/2022)1 | 500 | 508 |
| Goldman Sachs Group, Inc. (3-month USD-LIBOR + 1.17%) 3.08% 20263 | 425 | 430 |
| Groupe BPCE SA 5.70% 20232 | 200 | 221 |
| Groupe BPCE SA 5.15% 20242 | 620 | 681 |
| Guardian Life Global Funding 2.90% 20242 | 265 | 273 |
| Hartford Financial Services Group, Inc. 2.80% 2029 | 2,270 | 2,283 |
| Hartford Financial Services Group, Inc. 3.60% 2049 | 300 | 305 |
| HSBC Holdings PLC 2.633% 2025 (3-month USD-LIBOR + 1.14% on 11/7/2024)1 | 3,070 | 3,061 |
American Funds Corporate Bond Fund — Page 1 of 14
unaudited
| Bonds, notes & other debt instruments (continued) Corporate bonds & notes (continued) Financials (continued) |
Principal amount (000) |
Value (000) |
| HSBC Holdings PLC 3.973% 2030 (3-month USD-LIBOR + 1.61% on 5/22/2029)1 |
$4,995 | $5,345 |
| Intesa Sanpaolo SpA 3.25% 20242 | 700 | 699 |
| JPMorgan Chase & Co. 2.25% 2020 | 1,552 | 1,552 |
| JPMorgan Chase & Co. (3-month USD-LIBOR + 0.955%) 2.889% 20203 |
3,800 | 3,805 |
| JPMorgan Chase & Co. 2.301% 2025 (USD-SOFR + 1.16% on 10/15/2024)1 |
5,300 | 5,290 |
| JPMorgan Chase & Co. 2.739% 2030 (USD-SOFR + 1.51% on 10/15/2029)1 |
6,009 | 6,004 |
| Lloyds Banking Group PLC 4.375% 2028 | 590 | 648 |
| Marsh & McLennan Companies, Inc. 4.375% 2029 | 480 | 544 |
| MetLife, Inc. 4.60% 2046 | 100 | 122 |
| Metropolitan Life Global Funding I 2.00% 20202 | 150 | 150 |
| Metropolitan Life Global Funding I 2.50% 20202 | 150 | 151 |
| Metropolitan Life Global Funding I 1.95% 20212 | 850 | 850 |
| Metropolitan Life Global Funding I 2.40% 20212 | 1,200 | 1,206 |
| Metropolitan Life Global Funding I 3.45% 20212 | 150 | 154 |
| Metropolitan Life Global Funding I 2.40% 20222 | 480 | 486 |
| Metropolitan Life Global Funding I 3.60% 20242 | 400 | 422 |
| Metropolitan Life Global Funding I 3.45% 20262 | 150 | 161 |
| Metropolitan Life Global Funding I 3.00% 20272 | 200 | 208 |
| Metropolitan Life Global Funding I 3.05% 20292 | 750 | 785 |
| Mitsubishi UFJ Financial Group, Inc. 3.195% 2029 | 2,190 | 2,274 |
| Morgan Stanley 3.737% 2024 (3-month USD-LIBOR + 0.847% on 4/24/2023)1 | 2,500 | 2,616 |
| Morgan Stanley 2.72% 2025 (USD-SOFR + 1.152% on 7/22/2024)1 | 1,000 | 1,012 |
| Nationwide Building Society 4.125% 2032 (5-year USD ICE Swap + 1.849% on 10/18/2027)1,2 | 500 | 515 |
| New York Life Global Funding 1.70% 20212 | 900 | 897 |
| New York Life Global Funding 2.00% 20212 | 800 | 801 |
| New York Life Global Funding 2.30% 20222 | 1,150 | 1,159 |
| New York Life Global Funding 3.00% 20282 | 200 | 209 |
| Nuveen, LLC 4.00% 20282 | 220 | 245 |
| PNC Financial Services Group, Inc. 2.20% 2024 | 1,000 | 998 |
| Principal Financial Group, Inc. 4.111% 20282 | 250 | 271 |
| Principal Financial Group, Inc. 3.70% 2029 | 235 | 256 |
| Progressive Corp. 4.00% 2029 | 250 | 281 |
| Prudential Financial, Inc. 3.905% 2047 | 350 | 380 |
| Prudential Financial, Inc. 4.35% 2050 | 250 | 290 |
| Prudential Financial, Inc. 3.70% 2051 | 975 | 1,016 |
| Prudential Financial, Inc., junior subordinated, 5.70% 2048 (3-month USD-LIBOR + 2.665% on 9/15/2028)1 | 500 | 573 |
| Rabobank Nederland 4.375% 2025 | 500 | 543 |
| Royal Bank of Canada 3.20% 2021 | 2,000 | 2,035 |
| Royal Bank of Canada 2.25% 2024 | 2,750 | 2,741 |
| Royal Bank of Scotland PLC 4.445% 2030 (3-month USD-LIBOR + 1.871% on 5/5/2029)1 | 1,250 | 1,363 |
| Toronto-Dominion Bank 2.65% 2024 | 1,800 | 1,837 |
| Travelers Companies, Inc. 4.00% 2047 | 105 | 121 |
| Travelers Companies, Inc. 4.05% 2048 | 100 | 116 |
| Travelers Companies, Inc. 4.10% 2049 | 380 | 444 |
| UBS Group AG 3.126% 2030 (3-month USD-LIBOR + 1.468% on 8/13/2029)1,2 | 775 | 788 |
| UniCredit SpA 5.861% 20321,2 | 1,510 | 1,577 |
| US Bancorp 2.05% 2020 | 1,650 | 1,652 |
| US Bancorp 2.40% 2024 | 1,800 | 1,824 |
| US Bank NA (3-month USD-LIBOR + 0.32%) 2.256% 20203 | 1,875 | 1,875 |
| US Bank NA 3.00% 2021 | 2,000 | 2,024 |
American Funds Corporate Bond Fund — Page 2 of 14
unaudited
| Bonds, notes & other debt instruments (continued) Corporate bonds & notes (continued) Financials (continued) |
Principal amount (000) |
Value (000) |
| Wells Fargo & Co. (3-month USD-LIBOR + 0.65%) 2.762% 20193 | $8,425 | $8,426 |
| Wells Fargo & Co. 2.406% 2025 (3-month USD-LIBOR + 0.82% on 10/30/2024)1 | 2,225 | 2,221 |
| Wells Fargo & Co. 3.196% 2027 (3-month USD-LIBOR + 1.17% on 4/17/2027)1 | 1,200 | 1,240 |
| Wells Fargo & Co. 2.879% 2030 (3-month USD-LIBOR + 1.17% on 10/30/2029)1 |
8,280 | 8,328 |
| Willis North America Inc. 3.875% 2049 | 250 | 248 |
| 131,718 | ||
| Utilities 13.48% | ||
| AEP Transmission Co. LLC 3.80% 2049 | 200 | 222 |
| Alliant Energy Finance LLC 3.75% 20232 | 377 | 393 |
| Alliant Energy Finance LLC 4.25% 20282 | 377 | 407 |
| Ameren Corp. 2.50% 2024 | 242 | 243 |
| American Electric Power Co., Inc. 3.65% 2021 | 1,600 | 1,651 |
| CenterPoint Energy, Inc. 3.85% 2024 | 780 | 821 |
| CenterPoint Energy, Inc. 2.95% 2030 | 1,900 | 1,885 |
| CMS Energy Corp. 3.00% 2026 | 1,000 | 1,024 |
| Colbun SA 4.50% 2024 | 200 | 213 |
| Colbun SA 3.95% 20272 | 400 | 412 |
| Comision Federal de Electricidad 4.75% 20272 | 500 | 525 |
| Connecticut Light and Power Co. 3.20% 2027 | 1,125 | 1,194 |
| Consolidated Edison Co. of New York, Inc. 4.65% 2048 | 290 | 358 |
| Consolidated Edison Co. of New York, Inc. 4.125% 2049 | 390 | 448 |
| Consumers Energy Co. 3.10% 2050 | 1,030 | 1,044 |
| Dominion Resources, Inc., junior subordinated, 3.071% 20241 | 1,000 | 1,025 |
| DTE Energy Co. 3.40% 2029 | 1,200 | 1,247 |
| DTE Energy Co. 3.95% 2049 | 230 | 268 |
| Duke Energy Corp. 3.40% 2029 | 1,475 | 1,549 |
| Duke Energy Florida, LLC 2.50% 2029 | 3,795 | 3,818 |
| Duke Energy Progress, LLC 3.60% 2047 | 101 | 109 |
| Edison International 3.125% 2022 | 725 | 729 |
| Edison International 3.55% 2024 | 3,650 | 3,680 |
| Edison International 5.75% 2027 | 468 | 515 |
| Edison International 4.125% 2028 | 6,932 | 7,014 |
| EDP Finance BV 5.25% 20212 | 400 | 413 |
| EDP Finance BV 3.625% 20242 | 200 | 208 |
| Electricité de France SA 4.95% 20452 | 200 | 237 |
| Electricité de France SA 5.25% (USD Semi Annual 30/360 (vs. 3-month USD-LIBOR) 10-year + 3.709% on 1/29/2023)1,2 |
150 | 156 |
| Emera Inc. 6.75% 2076 (3-month USD-LIBOR + 5.44% on 6/15/2026)1 | 400 | 451 |
| Empresa Nacional de Electricidad SA 4.25% 2024 | 150 | 157 |
| Enel Chile SA 4.875% 2028 | 145 | 160 |
| Enel Finance International SA 3.50% 20282 | 400 | 409 |
| Enel Finance International SA 6.00% 20392 | 250 | 313 |
| Enel Società per Azioni 8.75% 20731,2 | 1,000 | 1,173 |
| Entergy Corp. 2.95% 2026 | 2,085 | 2,123 |
| Eversource Energy 3.30% 2028 | 593 | 616 |
| FirstEnergy Corp. 3.90% 2027 | 4,050 | 4,344 |
| FirstEnergy Corp. 3.50% 20282 | 1,000 | 1,047 |
| FirstEnergy Corp. 4.85% 2047 | 1,250 | 1,485 |
| Florida Power & Light Co. 4.95% 2035 | 432 | 541 |
| Florida Power & Light Co. 3.15% 2049 | 1,750 | 1,787 |
| Gulf Power Co. 3.30% 2027 | 1,000 | 1,058 |
| IPALCO Enterprises, Inc. 3.70% 2024 | 400 | 416 |
American Funds Corporate Bond Fund — Page 3 of 14
unaudited
| Bonds, notes & other debt instruments (continued) Corporate bonds & notes (continued) Utilities (continued) |
Principal amount (000) |
Value (000) |
| Jersey Central Power & Light Co. 4.30% 20262 | $1,085 | $1,185 |
| Metropolitan Edison Co. 4.30% 20292 | 200 | 225 |
| MidAmerican Energy Holdings Co. 3.65% 2029 | 6,130 | 6,734 |
| Mississippi Power Co. 3.95% 2028 | 1,000 | 1,088 |
| Mississippi Power Co. 4.25% 2042 | 1,350 | 1,468 |
| National Grid PLC 3.15% 20272 | 265 | 275 |
| New York State Electric & Gas Corp. 3.25% 20262 | 100 | 104 |
| Niagara Mohawk Power Corp. 3.508% 20242 | 300 | 316 |
| Northern States Power Co. 2.90% 2050 | 625 | 609 |
| Pacific Gas and Electric Co. 3.50% 20204 | 1,481 | 1,464 |
| Pacific Gas and Electric Co. 2.45% 20224 | 725 | 703 |
| Pacific Gas and Electric Co. 4.25% 20232,4 | 2,000 | 1,996 |
| Pacific Gas and Electric Co. 2.95% 20264 | 1,313 | 1,280 |
| Pacific Gas and Electric Co. 4.65% 20282,4 | 1,442 | 1,457 |
| Pacific Gas and Electric Co. 3.95% 20474 | 200 | 193 |
| PacifiCorp., First Mortgage Bonds, 3.50% 2029 | 1,000 | 1,083 |
| Progress Energy, Inc. 7.00% 2031 | 525 | 715 |
| Public Service Electric and Gas Co. 3.65% 2028 | 458 | 501 |
| Public Service Electric and Gas Co. 3.20% 2029 | 615 | 658 |
| Public Service Electric and Gas Co. 3.85% 2049 | 805 | 921 |
| Public Service Enterprise Group Inc. 2.25% 2026 | 2,000 | 1,994 |
| Public Service Enterprise Group Inc. 3.20% 2049 | 579 | 598 |
| Puget Energy, Inc. 6.50% 2020 | 5,000 | 5,224 |
| Puget Energy, Inc. 5.625% 2022 | 925 | 990 |
| Puget Energy, Inc. 3.65% 2025 | 275 | 285 |
| San Diego Gas & Electric Co. 3.95% 2041 | 170 | 176 |
| San Diego Gas & Electric Co. 4.30% 2042 | 300 | 324 |
| San Diego Gas & Electric Co. 3.75% 2047 | 5,531 | 5,761 |
| San Diego Gas & Electric Co. 4.10% 2049 | 1,590 | 1,778 |
| SCANA Corp. 6.25% 2020 | 2,822 | 2,851 |
| SCANA Corp. 4.75% 2021 | 822 | 841 |
| SCANA Corp. 4.125% 2022 | 264 | 270 |
| Southern California Edison Co. 3.50% 2023 | 3,075 | 3,191 |
| Southern California Edison Co. 2.85% 2029 | 900 | 909 |
| Southern California Edison Co. 4.20% 2029 | 1,295 | 1,425 |
| Southern California Edison Co. 6.00% 2034 | 751 | 925 |
| Southern California Edison Co. 5.35% 2035 | 1,000 | 1,190 |
| Southern California Edison Co. 5.75% 2035 | 665 | 802 |
| Southern California Edison Co. 4.125% 2048 | 3,180 | 3,410 |
| Southern California Edison Co., Series C, 3.60% 2045 | 1,106 | 1,094 |
| Virginia Electric and Power Co. 4.00% 2046 | 1,748 | 1,967 |
| Virginia Electric and Power Co. 3.30% 2049 | 3,300 | 3,356 |
| Xcel Energy Inc. 2.60% 2029 | 1,300 | 1,290 |
| Xcel Energy Inc. 3.50% 2049 | 3,050 | 3,084 |
| 114,598 | ||
| Energy 12.69% | ||
| Apache Corp. 4.25% 2030 | 3,695 | 3,686 |
| Apache Corp. 5.35% 2049 | 3,385 | 3,392 |
| Baker Hughes, a GE Co. 3.138% 2029 | 1,637 | 1,661 |
| BP Capital Markets PLC 2.315% 2020 | 357 | 357 |
| BP Capital Markets PLC 3.062% 2022 | 1,073 | 1,100 |
| BP Capital Markets PLC 3.79% 2024 | 1,600 | 1,699 |
| BP Capital Markets PLC 3.41% 2026 | 2,870 | 3,036 |
American Funds Corporate Bond Fund — Page 4 of 14
unaudited
| Bonds, notes & other debt instruments (continued) Corporate bonds & notes (continued) Energy (continued) |
Principal amount (000) |
Value (000) |
| BP Capital Markets PLC 4.234% 2028 | $2,060 | $2,322 |
| Canadian Natural Resources Ltd. 2.95% 2023 | 1,495 | 1,522 |
| Canadian Natural Resources Ltd. 3.85% 2027 | 3,085 | 3,270 |
| Canadian Natural Resources Ltd. 4.95% 2047 | 187 | 221 |
| Cenovus Energy Inc. 5.25% 2037 | 730 | 797 |
| Cenovus Energy Inc. 5.40% 2047 | 2,508 | 2,860 |
| Cheniere Energy, Inc. 3.70% 20292 | 4,689 | 4,740 |
| Chevron Corp. 2.498% 2022 | 2,600 | 2,638 |
| Chevron Corp. 2.954% 2026 | 3,360 | 3,536 |
| Concho Resources Inc. 4.30% 2028 | 1,940 | 2,084 |
| Concho Resources Inc. 4.85% 2048 | 750 | 840 |
| Enbridge Energy Partners, LP 4.375% 2020 | 60 | 61 |
| Enbridge Energy Partners, LP 7.375% 2045 | 1,265 | 1,880 |
| Enbridge Inc. 4.00% 2023 | 750 | 794 |
| Enbridge Inc. 3.50% 2024 | 1,100 | 1,145 |
| Energy Transfer Partners, LP 4.00% 2027 | 790 | 807 |
| Energy Transfer Partners, LP 4.20% 2027 | 373 | 383 |
| Energy Transfer Partners, LP 6.125% 2045 | 125 | 141 |
| Energy Transfer Partners, LP 5.30% 2047 | 1,265 | 1,316 |
| Energy Transfer Partners, LP 5.40% 2047 | 2,351 | 2,478 |
| Energy Transfer Partners, LP 6.00% 2048 | 1,893 | 2,162 |
| Energy Transfer Partners, LP 6.25% 2049 | 1,205 | 1,421 |
| Enterprise Products Operating LLC 4.20% 2050 | 700 | 752 |
| Equinor ASA 3.625% 2028 | 2,225 | 2,461 |
| Equinor ASA 3.25% 2049 | 1,150 | 1,185 |
| Exxon Mobil Corp. 2.222% 2021 | 4,500 | 4,523 |
| Exxon Mobil Corp. 1.902% 2022 | 270 | 271 |
| Exxon Mobil Corp. 2.019% 2024 | 660 | 664 |
| Exxon Mobil Corp. 2.44% 2029 | 1,875 | 1,886 |
| Exxon Mobil Corp. 2.995% 2039 | 100 | 102 |
| Exxon Mobil Corp. 3.095% 2049 | 120 | 121 |
| Kinder Morgan Energy Partners, LP 3.50% 2023 | 1,570 | 1,626 |
| Kinder Morgan, Inc. 3.15% 2023 | 610 | 623 |
| Kinder Morgan, Inc. 5.05% 2046 | 275 | 305 |
| Kinder Morgan, Inc. 5.20% 2048 | 475 | 548 |
| MPLX LP 3.50% 20222 | 650 | 666 |
| Noble Energy, Inc. 3.25% 2029 | 3,755 | 3,727 |
| Noble Energy, Inc. 4.95% 2047 | 1,585 | 1,691 |
| Noble Energy, Inc. 4.20% 2049 | 625 | 606 |
| Occidental Petroleum Corp. 4.85% 2021 | 434 | 447 |
| Occidental Petroleum Corp. 2.90% 2024 | 3,649 | 3,673 |
| Occidental Petroleum Corp. 3.20% 2026 | 748 | 753 |
| Occidental Petroleum Corp. 3.50% 2029 | 3,409 | 3,445 |
| Occidental Petroleum Corp. 4.40% 2049 | 2,090 | 2,125 |
| Petroleos Mexicanos 6.84% 20302 | 1,250 | 1,310 |
| Sabine Pass Liquefaction, LLC 5.625% 20211 | 380 | 391 |
| Shell International Finance BV 1.75% 2021 | 50 | 50 |
| Shell International Finance BV 3.50% 2023 | 1,558 | 1,646 |
| Shell International Finance BV 2.00% 2024 | 3,680 | 3,664 |
| Shell International Finance BV 2.50% 2026 | 710 | 718 |
| Shell International Finance BV 3.875% 2028 | 1,230 | 1,368 |
| Shell International Finance BV 2.375% 2029 | 280 | 277 |
| Shell International Finance BV 3.75% 2046 | 220 | 243 |
| Shell International Finance BV 4.00% 2046 | 355 | 409 |
American Funds Corporate Bond Fund — Page 5 of 14
unaudited
| Bonds, notes & other debt instruments (continued) Corporate bonds & notes (continued) Energy (continued) |
Principal amount (000) |
Value (000) |
| Shell International Finance BV 3.125% 2049 | $1,745 | $1,741 |
| Total Capital International 2.434% 2025 | 3,945 | 3,998 |
| Total Capital International 3.455% 2029 | 1,830 | 1,984 |
| Total Capital International 3.461% 2049 | 410 | 440 |
| Total Capital SA 3.883% 2028 | 590 | 659 |
| TransCanada PipeLines Ltd. 4.875% 2048 | 800 | 934 |
| TransCanada PipeLines Ltd. 5.10% 2049 | 750 | 907 |
| Valero Energy Corp. 4.00% 2029 | 390 | 417 |
| Williams Partners LP 4.50% 2023 | 2,000 | 2,127 |
| 107,832 | ||
| Health care 11.40% | ||
| Abbott Laboratories 2.90% 2021 | 2,241 | 2,282 |
| Abbott Laboratories 3.40% 2023 | 1,556 | 1,630 |
| Abbott Laboratories 3.75% 2026 | 1,241 | 1,362 |
| AbbVie Inc. 2.50% 2020 | 100 | 100 |
| AbbVie Inc. 2.30% 2021 | 80 | 80 |
| AbbVie Inc. 2.85% 2023 | 600 | 611 |
| AbbVie Inc. 2.60% 20242 | 331 | 333 |
| AbbVie Inc. 2.95% 20262 | 2,105 | 2,129 |
| AbbVie Inc. 3.20% 20292 | 4,100 | 4,168 |
| AbbVie Inc. 4.05% 20392 | 934 | 977 |
| AbbVie Inc. 4.45% 2046 | 455 | 490 |
| AbbVie Inc. 4.875% 2048 | 900 | 1,037 |
| AbbVie Inc. 4.25% 20492 | 4,072 | 4,295 |
| Allergan PLC 3.00% 2020 | 300 | 301 |
| Allergan PLC 3.45% 2022 | 3,584 | 3,662 |
| Allergan PLC 3.80% 2025 | 324 | 340 |
| Allergan PLC 4.75% 2045 | 350 | 385 |
| Anthem, Inc. 2.375% 2025 | 400 | 399 |
| Anthem, Inc. 2.875% 2029 | 725 | 724 |
| AstraZeneca PLC 2.375% 2022 | 1,000 | 1,010 |
| AstraZeneca PLC 3.375% 2025 | 740 | 783 |
| AstraZeneca PLC 4.00% 2029 | 1,002 | 1,123 |
| Bayer US Finance II LLC 4.25% 20252 | 450 | 483 |
| Bayer US Finance II LLC 4.375% 20282 | 1,600 | 1,751 |
| Becton, Dickinson and Co. 2.675% 2019 | 13 | 13 |
| Becton, Dickinson and Co. 2.894% 2022 | 2,210 | 2,244 |
| Becton, Dickinson and Co. 3.363% 2024 | 1,150 | 1,197 |
| Becton, Dickinson and Co. 3.70% 2027 | 991 | 1,062 |
| Boston Scientific Corp. 3.375% 2022 | 400 | 413 |
| Boston Scientific Corp. 3.45% 2024 | 300 | 314 |
| Boston Scientific Corp. 3.75% 2026 | 470 | 507 |
| Boston Scientific Corp. 4.70% 2049 | 495 | 607 |
| Bristol-Myers Squibb Co. 2.60% 20222 | 378 | 384 |
| Bristol-Myers Squibb Co. 2.90% 20242 | 470 | 485 |
| Bristol-Myers Squibb Co. 3.20% 20262 | 251 | 264 |
| Bristol-Myers Squibb Co. 3.40% 20292 | 2,140 | 2,300 |
| Bristol-Myers Squibb Co 4.125% 20392 | 2,420 | 2,800 |
| Bristol-Myers Squibb Co. 4.25% 20492 | 950 | 1,129 |
| Centene Corp. 4.625% 20292 | 2,470 | 2,597 |
| Cigna Corp. 3.75% 2023 | 400 | 418 |
| Cigna Corp. 4.375% 2028 | 1,110 | 1,234 |
| Cigna Corp. 4.80% 2038 | 690 | 801 |
American Funds Corporate Bond Fund — Page 6 of 14
unaudited
| Bonds, notes & other debt instruments (continued) Corporate bonds & notes (continued) Health care (continued) |
Principal amount (000) |
Value (000) |
| Cigna Corp. 4.90% 2048 | $1,060 | $1,260 |
| CVS Health Corp. 3.35% 2021 | 181 | 184 |
| CVS Health Corp. 4.30% 2028 | 732 | 799 |
| CVS Health Corp. 5.05% 2048 | 68 | 81 |
| Eli Lilly and Co. 3.375% 2029 | 594 | 641 |
| EMD Finance LLC 3.25% 20252 | 2,200 | 2,267 |
| GlaxoSmithKline PLC 3.125% 2021 | 2,440 | 2,482 |
| GlaxoSmithKline PLC 2.875% 2022 | 1,514 | 1,547 |
| GlaxoSmithKline PLC 3.375% 2023 | 475 | 496 |
| GlaxoSmithKline PLC 3.00% 2024 | 1,115 | 1,156 |
| Laboratory Corp. of America Holdings 2.625% 2020 | 200 | 200 |
| Medtronic, Inc. 3.50% 2025 | 89 | 95 |
| Merck & Co., Inc. 2.80% 2023 | 261 | 269 |
| Merck & Co., Inc. 2.90% 2024 | 688 | 715 |
| Merck & Co., Inc. 2.75% 2025 | 433 | 447 |
| Merck & Co., Inc. 3.40% 2029 | 561 | 610 |
| Novartis Capital Corp. 2.40% 2022 | 2,000 | 2,031 |
| Pfizer Inc. 3.00% 2021 | 657 | 671 |
| Pfizer Inc. 2.80% 2022 | 459 | 469 |
| Pfizer Inc. 3.20% 2023 | 2,407 | 2,510 |
| Pfizer Inc. 2.95% 2024 | 2,284 | 2,376 |
| Pfizer Inc. 4.00% 2049 | 120 | 141 |
| Shire PLC 2.40% 2021 | 831 | 835 |
| Shire PLC 2.875% 2023 | 605 | 616 |
| Shire PLC 3.20% 2026 | 2,695 | 2,789 |
| Takeda Pharmaceutical Co., Ltd. 4.40% 20232 | 2,455 | 2,639 |
| Takeda Pharmaceutical Co., Ltd. 5.00% 20282 | 4,378 | 5,112 |
| Teva Pharmaceutical Finance Co. BV 2.80% 2023 | 5,365 | 4,855 |
| Teva Pharmaceutical Finance Co. BV 3.15% 2026 | 615 | 506 |
| Teva Pharmaceutical Finance Co. BV 4.10% 2046 | 1,650 | 1,205 |
| UnitedHealth Group Inc. 2.125% 2021 | 100 | 100 |
| UnitedHealth Group Inc. 2.375% 2024 | 1,055 | 1,065 |
| UnitedHealth Group Inc. 3.50% 2024 | 845 | 892 |
| UnitedHealth Group Inc. 3.75% 2025 | 400 | 431 |
| UnitedHealth Group Inc. 2.875% 2029 | 1,155 | 1,191 |
| UnitedHealth Group Inc. 4.45% 2048 | 1,220 | 1,464 |
| UnitedHealth Group Inc. 3.70% 2049 | 480 | 516 |
| WellPoint, Inc. 3.125% 2022 | 1,575 | 1,612 |
| Zimmer Holdings, Inc. 3.15% 2022 | 400 | 407 |
| 96,906 | ||
| Consumer staples 8.57% | ||
| Altria Group, Inc. 3.80% 2024 | 275 | 289 |
| Altria Group, Inc. 4.40% 2026 | 228 | 246 |
| Altria Group, Inc. 4.80% 2029 | 4,310 | 4,769 |
| Altria Group, Inc. 5.80% 2039 | 110 | 130 |
| Altria Group, Inc. 5.95% 2049 | 4,252 | 5,122 |
| Anheuser-Busch Co./InBev Worldwide 4.90% 2046 | 3,740 | 4,494 |
| Anheuser-Busch InBev NV 4.15% 2025 | 1,000 | 1,089 |
| Anheuser-Busch InBev NV 4.00% 2028 | 200 | 221 |
| Anheuser-Busch InBev NV 4.75% 2029 | 1,031 | 1,200 |
| Anheuser-Busch InBev NV 4.90% 2031 | 250 | 299 |
| Anheuser-Busch InBev NV 5.45% 2039 | 160 | 203 |
| Anheuser-Busch InBev NV 5.55% 2049 | 1,983 | 2,633 |
American Funds Corporate Bond Fund — Page 7 of 14
unaudited
| Bonds, notes & other debt instruments (continued) Corporate bonds & notes (continued) Consumer staples (continued) |
Principal amount (000) |
Value (000) |
| British American Tobacco PLC 2.764% 2022 | $310 | $313 |
| British American Tobacco PLC 2.789% 2024 | 1,500 | 1,502 |
| British American Tobacco PLC 3.222% 2024 | 1,210 | 1,232 |
| British American Tobacco PLC 3.215% 2026 | 2,195 | 2,201 |
| British American Tobacco PLC 3.557% 2027 | 4,683 | 4,775 |
| British American Tobacco PLC 3.462% 2029 | 670 | 666 |
| British American Tobacco PLC 4.54% 2047 | 3,385 | 3,302 |
| British American Tobacco PLC 4.758% 2049 | 360 | 365 |
| Coca-Cola Co. 1.75% 2024 | 2,250 | 2,240 |
| Conagra Brands, Inc. 3.80% 2021 | 2,500 | 2,574 |
| Conagra Brands, Inc. 4.30% 2024 | 700 | 751 |
| Conagra Brands, Inc. 4.60% 2025 | 1,155 | 1,271 |
| Conagra Brands, Inc. 5.40% 2048 | 925 | 1,102 |
| Constellation Brands, Inc. 2.65% 2022 | 600 | 608 |
| Constellation Brands, Inc. 4.25% 2023 | 457 | 487 |
| Constellation Brands, Inc. 3.60% 2028 | 200 | 213 |
| Constellation Brands, Inc. 4.10% 2048 | 200 | 212 |
| Costco Wholesale Corp. 2.30% 2022 | 894 | 905 |
| Costco Wholesale Corp. 2.75% 2024 | 975 | 1,007 |
| Keurig Dr Pepper Inc. 3.551% 2021 | 625 | 638 |
| Keurig Dr Pepper Inc. 4.057% 2023 | 1,950 | 2,063 |
| Keurig Dr Pepper Inc. 4.417% 2025 | 455 | 497 |
| Keurig Dr Pepper Inc. 4.597% 2028 | 591 | 671 |
| Keurig Dr Pepper Inc. 5.085% 2048 | 704 | 847 |
| Kraft Heinz Co. 3.50% 2022 | 1,650 | 1,706 |
| Molson Coors Brewing Co. 2.25% 2020 | 300 | 300 |
| Molson Coors Brewing Co. 4.20% 2046 | 1,275 | 1,257 |
| Nestlé Holdings, Inc. 3.35% 20232 | 2,200 | 2,312 |
| Philip Morris International Inc. 2.875% 2024 | 972 | 1,000 |
| Philip Morris International Inc. 3.375% 2029 | 1,395 | 1,467 |
| Reynolds American Inc. 4.45% 2025 | 225 | 241 |
| Reynolds American Inc. 5.85% 2045 | 225 | 255 |
| Wal-Mart Stores, Inc. 3.125% 2021 | 2,806 | 2,865 |
| Wal-Mart Stores, Inc. 2.35% 2022 | 200 | 203 |
| Wal-Mart Stores, Inc. 2.55% 2023 | 2,720 | 2,776 |
| Wal-Mart Stores, Inc. 3.40% 2023 | 535 | 562 |
| Wal-Mart Stores, Inc. 2.85% 2024 | 2,952 | 3,061 |
| Wal-Mart Stores, Inc. 3.05% 2026 | 350 | 369 |
| Wal-Mart Stores, Inc. 3.70% 2028 | 350 | 387 |
| WM. Wrigley Jr. Co. 3.375% 20202 | 2,950 | 2,982 |
| 72,880 | ||
| Industrials 7.11% | ||
| 3M Co. 2.25% 2023 | 1,400 | 1,414 |
| 3M Co. 3.25% 2024 | 90 | 94 |
| Ashtead Group PLC 4.00% 20282 | 1,880 | 1,892 |
| Ashtead Group PLC 4.25% 20292 | 340 | 344 |
| Avolon Holdings Funding Ltd. 3.95% 20242 | 1,451 | 1,506 |
| Boeing Co. 2.70% 2022 | 2,100 | 2,136 |
| Boeing Co. 3.10% 2026 | 790 | 823 |
| Boeing Co. 2.70% 2027 | 970 | 987 |
| Boeing Co. 3.20% 2029 | 1,031 | 1,085 |
| Boeing Co. 2.95% 2030 | 433 | 447 |
| Boeing Co 3.60% 2034 | 430 | 465 |
American Funds Corporate Bond Fund — Page 8 of 14
unaudited
| Bonds, notes & other debt instruments (continued) Corporate bonds & notes (continued) Industrials (continued) |
Principal amount (000) |
Value (000) |
| Continental Airlines, Inc., Series 2000-2, Class A1, 7.707% 2022 | $18 | $18 |
| CSX Corp. 3.80% 2028 | 1,725 | 1,882 |
| CSX Corp. 4.25% 2029 | 2,000 | 2,260 |
| CSX Corp. 2.40% 2030 | 425 | 416 |
| CSX Corp. 4.75% 2048 | 270 | 332 |
| CSX Corp. 3.35% 2049 | 1,140 | 1,128 |
| CSX Corp. 4.50% 2049 | 1,075 | 1,267 |
| GE Capital International Funding Co. 4.418% 2035 | 250 | 269 |
| General Dynamics Corp. 3.00% 2021 | 2,500 | 2,541 |
| General Dynamics Corp. 3.50% 2025 | 1,000 | 1,070 |
| General Dynamics Corp. 3.75% 2028 | 1,100 | 1,224 |
| General Electric Capital Corp. 3.373% 2025 | 2,025 | 2,094 |
| General Electric Co. 2.70% 2022 | 500 | 504 |
| General Electric Co. 4.125% 2042 | 8 | 9 |
| Honeywell International Inc. 2.15% 2022 | 2,820 | 2,840 |
| Honeywell International Inc. 2.30% 2024 | 3,525 | 3,571 |
| Honeywell International Inc. 2.70% 2029 | 1,522 | 1,565 |
| Lockheed Martin Corp. 2.50% 2020 | 774 | 778 |
| Lockheed Martin Corp. 3.10% 2023 | 135 | 139 |
| Lockheed Martin Corp. 4.50% 2036 | 10 | 12 |
| Lockheed Martin Corp. 4.70% 2046 | 1,150 | 1,454 |
| Norfolk Southern Corp. 3.00% 2022 | 1,071 | 1,094 |
| Norfolk Southern Corp. 2.55% 2029 | 1,605 | 1,604 |
| Norfolk Southern Corp. 3.40% 2049 | 197 | 197 |
| Northrop Grumman Corp. 2.55% 2022 | 3,560 | 3,610 |
| Northrop Grumman Corp. 3.25% 2028 | 2,100 | 2,192 |
| Parker-Hannifin Corp. 2.70% 2024 | 560 | 567 |
| Parker-Hannifin Corp. 3.25% 2029 | 640 | 665 |
| Parker-Hannifin Corp. 4.00% 2049 | 120 | 129 |
| Rockwell Collins, Inc. 2.80% 2022 | 390 | 396 |
| Roper Technologies, Inc. 2.80% 2021 | 25 | 25 |
| Siemens AG 2.70% 20222 | 250 | 254 |
| Siemens AG 2.90% 20222 | 450 | 459 |
| Siemens AG 2.00% 20232 | 500 | 498 |
| Siemens AG 3.125% 20242 | 600 | 623 |
| Siemens AG 2.35% 20262 | 990 | 991 |
| Union Pacific Corp. 3.15% 2024 | 750 | 781 |
| Union Pacific Corp. 3.95% 2028 | 350 | 388 |
| Union Pacific Corp. 3.70% 2029 | 1,000 | 1,092 |
| Union Pacific Corp. 4.30% 2049 | 1,185 | 1,379 |
| Union Pacific Corp. 3.95% 2059 | 805 | 847 |
| United Parcel Service, Inc. 4.25% 2049 | 240 | 282 |
| United Technologies Corp. 3.65% 2023 | 1,700 | 1,793 |
| United Technologies Corp. 3.95% 2025 | 535 | 582 |
| United Technologies Corp. 4.125% 2028 | 1,475 | 1,662 |
| United Technologies Corp. 4.50% 2042 | 250 | 302 |
| Waste Management, Inc. 2.95% 2024 | 745 | 770 |
| Westinghouse Air Brake Technologies Corp. 4.40% 20241 | 602 | 639 |
| 60,387 | ||
| Information technology 5.24% | ||
| Apple Inc. 1.80% 2024 | 2,000 | 1,985 |
| Broadcom Inc. 4.75% 20292 | 7,800 | 8,348 |
| Broadcom Ltd. 3.00% 2022 | 1,025 | 1,037 |
American Funds Corporate Bond Fund — Page 9 of 14
unaudited
| Bonds, notes & other debt instruments (continued) Corporate bonds & notes (continued) Information technology (continued) |
Principal amount (000) |
Value (000) |
| Broadcom Ltd. 3.625% 2024 | $575 | $592 |
| Broadcom Ltd. 3.875% 2027 | 2,105 | 2,151 |
| Broadcom Ltd. 3.50% 2028 | 2,204 | 2,186 |
| Fidelity National Information Services, Inc. 3.75% 2029 | 1,295 | 1,412 |
| Fiserv, Inc. 3.50% 2029 | 5,515 | 5,803 |
| Fiserv, Inc. 4.40% 2049 | 1,850 | 2,069 |
| Global Payments Inc. 3.20% 2029 | 980 | 997 |
| International Business Machines Corp. 3.00% 2024 | 2,000 | 2,071 |
| Microsoft Corp. 1.55% 2021 | 1,225 | 1,220 |
| Microsoft Corp. 2.40% 2022 | 250 | 254 |
| Microsoft Corp. 2.875% 2024 | 1,950 | 2,025 |
| Microsoft Corp. 3.30% 2027 | 3,055 | 3,297 |
| Microsoft Corp. 4.25% 2047 | 475 | 589 |
| Oracle Corp. 1.90% 2021 | 800 | 800 |
| PayPal Holdings, Inc. 2.40% 2024 | 850 | 853 |
| PayPal Holdings, Inc. 2.65% 2026 | 554 | 556 |
| PayPal Holdings, Inc. 2.85% 2029 | 2,848 | 2,848 |
| Visa Inc. 2.15% 2022 | 3,375 | 3,407 |
| 44,500 | ||
| Communication services 4.30% | ||
| AT&T Inc. 2.45% 2020 | 9,000 | 9,014 |
| CCO Holdings LLC and CCO Holdings Capital Corp. 3.579% 2020 | 200 | 201 |
| CCO Holdings LLC and CCO Holdings Capital Corp. 4.50% 2024 | 300 | 321 |
| CCO Holdings LLC and CCO Holdings Capital Corp. 4.908% 2025 | 200 | 219 |
| CCO Holdings LLC and CCO Holdings Capital Corp. 3.75% 2028 | 200 | 206 |
| CCO Holdings LLC and CCO Holdings Capital Corp. 4.20% 2028 | 2,120 | 2,251 |
| CCO Holdings LLC and CCO Holdings Capital Corp. 5.75% 2048 | 370 | 429 |
| CCO Holdings LLC and CCO Holdings Capital Corp. 5.125% 2049 | 4,187 | 4,536 |
| CCO Holdings LLC and CCO Holdings Capital Corp. 4.80% 2050 | 550 | 574 |
| Comcast Corp. 3.95% 2025 | 1,900 | 2,074 |
| Comcast Corp. 4.15% 2028 | 1,000 | 1,128 |
| Comcast Corp. 2.65% 2030 | 5,530 | 5,573 |
| Comcast Corp. 4.60% 2038 | 520 | 625 |
| Comcast Corp. 3.25% 2039 | 170 | 173 |
| Comcast Corp. 4.00% 2047 | 200 | 224 |
| Comcast Corp. 4.00% 2048 | 495 | 554 |
| Comcast Corp. 4.70% 2048 | 480 | 597 |
| Comcast Corp. 3.45% 2050 | 180 | 185 |
| Fox Corp. 5.576% 20492 | 750 | 957 |
| NBCUniversal Enterprise, Inc., junior subordinated, 5.25%2 | 2,035 | 2,097 |
| Vodafone Group PLC 5.25% 2048 | 2,039 | 2,439 |
| Vodafone Group PLC 4.25% 2050 | 1,900 | 1,979 |
| WPP Finance 2010 3.75% 2024 | 200 | 210 |
| 36,566 | ||
| Consumer discretionary 3.50% | ||
| Amazon.com, Inc. 3.15% 2027 | 450 | 479 |
| Amazon.com, Inc. 4.05% 2047 | 165 | 197 |
| American Honda Finance Corp. 2.60% 2022 | 100 | 102 |
| American Honda Finance Corp. 3.50% 2028 | 200 | 216 |
| Bayerische Motoren Werke AG 1.85% 20212 | 100 | 100 |
| Bayerische Motoren Werke AG 2.00% 20212 | 400 | 400 |
| Bayerische Motoren Werke AG 3.45% 20232 | 185 | 192 |
American Funds Corporate Bond Fund — Page 10 of 14
unaudited
| Bonds, notes & other debt instruments (continued) Corporate bonds & notes (continued) Consumer discretionary (continued) |
Principal amount (000) |
Value (000) |
| Bayerische Motoren Werke AG 3.15% 20242 | $2,000 | $2,069 |
| DaimlerChrysler North America Holding Corp. 2.45% 20202 | 725 | 726 |
| DaimlerChrysler North America Holding Corp. 3.65% 20242 | 2,750 | 2,881 |
| Ford Motor Credit Co. 3.664% 2024 | 968 | 960 |
| Ford Motor Credit Co. 4.687% 2025 | 250 | 257 |
| General Motors Co. 6.60% 2036 | 45 | 52 |
| General Motors Co. 6.75% 2046 | 305 | 355 |
| General Motors Co. 5.40% 2048 | 650 | 661 |
| General Motors Co. 5.95% 2049 | 380 | 415 |
| General Motors Financial Co. 3.55% 2021 | 200 | 203 |
| General Motors Financial Co. 3.55% 2022 | 870 | 893 |
| General Motors Financial Co. 3.50% 2024 | 190 | 194 |
| Home Depot, Inc. 3.90% 2028 | 125 | 141 |
| Home Depot, Inc. 2.95% 2029 | 1,115 | 1,167 |
| Home Depot, Inc. 4.50% 2048 | 714 | 895 |
| Hyundai Capital America 2.55% 20202 | 1,150 | 1,151 |
| Hyundai Capital America 3.25% 20222 | 150 | 153 |
| Las Vegas Sands Corp. 3.90% 2029 | 100 | 104 |
| Lowe’s Companies, Inc. 3.65% 2029 | 148 | 159 |
| Lowe’s Companies, Inc. 4.55% 2049 | 859 | 999 |
| McDonald’s Corp. 4.45% 2047 | 475 | 551 |
| Morongo Band of Mission Indians 7.00% 20392 | 1,100 | 1,288 |
| Sands China Ltd. 5.40% 2028 | 1,500 | 1,709 |
| Starbucks Corp. 4.50% 2048 | 375 | 436 |
| Toyota Motor Credit Corp. 2.15% 2020 | 638 | 639 |
| Toyota Motor Credit Corp. (3-month USD-LIBOR + 0.15%) 2.162% 20203 | 2,150 | 2,152 |
| Toyota Motor Credit Corp. 1.90% 2021 | 1,534 | 1,536 |
| Toyota Motor Credit Corp. 2.15% 2022 | 625 | 630 |
| Toyota Motor Credit Corp. 2.60% 2022 | 720 | 730 |
| Toyota Motor Credit Corp. 3.20% 2027 | 340 | 362 |
| Toyota Motor Credit Corp. 3.05% 2028 | 384 | 406 |
| Volkswagen Group of America Finance, LLC 2.85% 20242 | 1,334 | 1,353 |
| Volkswagen Group of America Finance, LLC 3.20% 20262 | 1,820 | 1,859 |
| 29,772 | ||
| Real estate 3.50% | ||
| Alexandria Real Estate Equities, Inc. 3.80% 2026 | 710 | 758 |
| Alexandria Real Estate Equities, Inc. 3.95% 2028 | 35 | 38 |
| Alexandria Real Estate Equities, Inc. 2.75% 2029 | 134 | 132 |
| Alexandria Real Estate Equities, Inc. 3.375% 2031 | 40 | 42 |
| American Campus Communities, Inc. 3.35% 2020 | 110 | 111 |
| American Campus Communities, Inc. 3.75% 2023 | 1,350 | 1,404 |
| American Campus Communities, Inc. 4.125% 2024 | 200 | 214 |
| American Campus Communities, Inc. 3.30% 2026 | 2,832 | 2,927 |
| American Campus Communities, Inc. 3.625% 2027 | 890 | 937 |
| EPR Properties 3.75% 2029 | 300 | 305 |
| Equinix, Inc. 2.625% 2024 | 2,165 | 2,170 |
| Equinix, Inc. 2.90% 2026 | 2,983 | 2,985 |
| Equinix, Inc. 3.20% 2029 | 3,495 | 3,512 |
| Essex Portfolio LP 3.625% 2022 | 200 | 207 |
| Essex Portfolio LP 3.50% 2025 | 70 | 73 |
| Essex Portfolio LP 3.375% 2026 | 200 | 209 |
| Essex Portfolio LP 4.00% 2029 | 180 | 196 |
| Gaming and Leisure Properties, Inc. 3.35% 2024 | 110 | 113 |
American Funds Corporate Bond Fund — Page 11 of 14
unaudited
| Bonds, notes & other debt instruments (continued) Corporate bonds & notes (continued) Real estate (continued) |
Principal amount (000) |
Value (000) |
| Gaming and Leisure Properties, Inc. 4.00% 2030 | $289 | $292 |
| Hospitality Properties Trust 4.35% 2024 | 2,000 | 2,052 |
| Kimco Realty Corp. 3.40% 2022 | 1,525 | 1,572 |
| Kimco Realty Corp. 3.30% 2025 | 1,000 | 1,036 |
| Kimco Realty Corp. 4.125% 2046 | 265 | 281 |
| Scentre Group 2.375% 20212 | 130 | 130 |
| Scentre Group 3.50% 20252 | 450 | 467 |
| Scentre Group 3.75% 20272 | 1,175 | 1,237 |
| WEA Finance LLC 3.25% 20202 | 90 | 91 |
| Westfield Corp. Ltd. 3.15% 20222 | 4,585 | 4,678 |
| Westfield Corp. Ltd. 3.50% 20292 | 1,500 | 1,556 |
| 29,725 | ||
| Materials 2.19% | ||
| Air Liquide SA 2.25% 20292 | 518 | 510 |
| ArcelorMittal 3.60% 2024 | 4,481 | 4,565 |
| ArcelorMittal 4.25% 2029 | 200 | 204 |
| Braskem SA 4.50% 20302 | 1,860 | 1,795 |
| Chevron Phillips Chemical Co. LLC 3.30% 20232 | 390 | 403 |
| Dow Chemical Co. 3.15% 2024 | 205 | 212 |
| Dow Chemical Co. 4.55% 2025 | 200 | 221 |
| Dow Chemical Co. 3.625% 2026 | 1,298 | 1,357 |
| Dow Chemical Co. 4.80% 2028 | 500 | 566 |
| Dow Chemical Co. 4.625% 2044 | 100 | 109 |
| Dow Chemical Co. 5.55% 2048 | 290 | 358 |
| Dow Chemical Co. 4.80% 2049 | 1,380 | 1,557 |
| DowDuPont Inc. 5.419% 2048 | 675 | 841 |
| Glencore Funding LLC 4.125% 20242 | 1,000 | 1,050 |
| LYB International Finance BV 4.875% 2044 | 100 | 111 |
| LYB International Finance III, LLC 4.20% 2049 | 249 | 256 |
| LyondellBasell Industries NV 6.00% 2021 | 200 | 213 |
| Nutrien Ltd. 4.20% 2029 | 250 | 274 |
| Nutrien Ltd. 5.00% 2049 | 450 | 528 |
| Praxair, Inc. 3.00% 2021 | 616 | 627 |
| Sherwin-Williams Co. 2.75% 2022 | 203 | 206 |
| Sherwin-Williams Co. 3.125% 2024 | 600 | 621 |
| Sherwin-Williams Co. 3.45% 2027 | 150 | 158 |
| Sherwin-Williams Co. 2.95% 2029 | 1,270 | 1,282 |
| Sherwin-Williams Co. 3.80% 2049 | 300 | 309 |
| Westlake Chemical Corp. 5.00% 2046 | 130 | 141 |
| Westlake Chemical Corp. 4.375% 2047 | 160 | 161 |
| 18,635 | ||
| Total corporate bonds & notes | 743,519 | |
| U.S. Treasury bonds & notes 7.40% U.S. Treasury 7.24% |
||
| U.S. Treasury 1.50% 2021 | 1,505 | 1,502 |
| U.S. Treasury 1.375% 2022 | 7,600 | 7,552 |
| U.S. Treasury 1.25% 2024 | 4,410 | 4,335 |
| U.S. Treasury 1.50% 2024 | 5,996 | 5,962 |
| U.S. Treasury 1.50% 2024 | 3,257 | 3,237 |
| U.S. Treasury 1.50% 2024 | 1,803 | 1,792 |
| U.S. Treasury 1.75% 2024 | 82 | 82 |
American Funds Corporate Bond Fund — Page 12 of 14
unaudited
| Bonds, notes & other debt instruments (continued) U.S. Treasury bonds & notes (continued) U.S. Treasury (continued) |
Principal amount (000) |
Value (000) |
| U.S. Treasury 1.625% 2026 | $618 | $614 |
| U.S. Treasury 1.625% 2029 | 3,797 | 3,742 |
| U.S. Treasury 1.75% 2029 | 20,355 | 20,309 |
| U.S. Treasury 2.375% 20295 | 744 | 782 |
| U.S. Treasury 3.125% 2048 | 88 | 105 |
| U.S. Treasury 2.25% 20495 | 11,402 | 11,519 |
| 61,533 | ||
| U.S. Treasury inflation-protected securities 0.16% | ||
| U.S. Treasury Inflation-Protected Security 0.25% 20296 | 1,330 | 1,342 |
| Total U.S. Treasury bonds & notes | 62,875 | |
| Municipals 0.22% South Carolina 0.13% |
||
| Public Service Auth., Rev. Obligations (Santee Cooper), Series 2015-E, 5.25% 2055 | 400 | 461 |
| Public Service Auth., Rev. Obligations (Santee Cooper), Series 2016-B, 5.00% 2036 | 100 | 118 |
| Public Service Auth., Rev. Ref. Obligations (Santee Cooper), Series 2016-C, 5.00% 2035 | 460 | 546 |
| 1,125 | ||
| Illinois 0.09% | ||
| G.O. Bonds, Pension Funding, Series 2003, 5.10% 2033 | 675 | 727 |
| Total municipals | 1,852 | |
| Asset-backed obligations 0.13% | ||
| Global SC Finance V SRL, Series 2019-1A, Class B, 4.81% 20392,7 | 1,104 | 1,096 |
| Total bonds, notes & other debt instruments (cost: $779,441,000) | 809,342 | |
| Short-term securities 4.31% Money market investments 4.31% |
Shares | |
| Capital Group Central Cash Fund 1.78%8 | 366,050 | 36,605 |
| Total short-term securities (cost: $36,605,000) | 36,605 | |
| Total investment securities 99.54% (cost: $816,046,000) | 845,947 | |
| Other assets less liabilities 0.46% | 3,929 | |
| Net assets 100.00% | $849,876 |
Futures contracts
| Contracts | Type | Number of contracts |
Expiration | Notional amount9 (000) |
Value at 11/30/201910 (000) |
Unrealized (depreciation) appreciation at 11/30/2019 (000) |
| 2 Year U.S. Treasury Note Futures | Long | 112 | April 2020 | $22,400 | $24,146 | $(5) |
| 5 Year U.S. Treasury Note Futures | Long | 571 | April 2020 | 57,100 | 67,931 | (33) |
| 10 Year U.S. Treasury Note Futures | Short | 35 | March 2020 | (3,500) | (4,528) | 14 |
| 10 Year Ultra U.S. Treasury Note Futures | Short | 118 | March 2020 | (11,800) | (16,782) | 25 |
| 20 Year U.S. Treasury Bond Futures | Long | 2 | March 2020 | 200 | 318 | (1) |
| 30 Year Ultra U.S. Treasury Bond Futures | Long | 37 | March 2020 | 3,700 | 6,946 | 27 |
| $27 |
American Funds Corporate Bond Fund — Page 13 of 14
unaudited
| 1 | Step bond; coupon rate may change at a later date. |
| 2 | Acquired in a transaction exempt from registration under Rule 144A of the Securities Act of 1933. May be resold in the U.S. in transactions exempt from registration, normally to qualified institutional buyers. The total value of all such securities was $118,180,000, which represented 13.91% of the net assets of the fund. |
| 3 | Coupon rate may change periodically. |
| 4 | Scheduled interest and/or principal payment was not received. |
| 5 | All or a portion of this security was pledged as collateral. The total value of pledged collateral was $484,000, which represented .06% of the net assets of the fund. |
| 6 | Index-linked bond whose principal amount moves with a government price index. |
| 7 | Principal payments may be made periodically. Therefore, the effective maturity date may be earlier than the stated maturity date. |
| 8 | Rate represents the seven-day yield at 11/30/2019. |
| 9 | Notional amount is calculated based on the number of contracts and notional contract size. |
| 10 | Value is calculated based on the notional amount and current market price. |
| Key to abbreviations and symbol |
| Auth. = Authority |
| G.O. = General Obligation |
| ICE = Intercontinental Exchange, Inc. |
| LIBOR = London Interbank Offered Rate |
| Ref. = Refunding |
| Rev. = Revenue |
| SOFR = Secured Overnight Financing Rate |
| USD/$ = U.S. dollars |
Additional financial disclosures are included in the fund’s current shareholder report and should be read in conjunction with this report.
Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.
Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectus and summary prospectus, which can be obtained from your financial professional and should be read carefully before investing. You may also call American Funds Service Company (AFS) at (800) 421-4225 or visit the Capital Group website at capitalgroup.com.
All Capital Group trademarks mentioned are owned by The Capital Group Companies, Inc., an affiliated company or fund. All other company and product names mentioned are the property of their respective companies.
American Funds Distributors, Inc., member FINRA.
© 2020 Capital Group. All rights reserved.
| MFGEFPX-032-0120O-S73207 | American Funds Corporate Bond Fund — Page 14 of 14 |
ITEM 7 – Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies
Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.
ITEM 8 – Portfolio Managers of Closed-End Management Investment Companies
Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.
ITEM 9 – Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers
Not applicable to this Registrant, insofar as the Registrant is not a closed-end management investment company.
ITEM 10 – Submission of Matters to a Vote of Security Holders
There have been no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s board of trustees since the Registrant last submitted a proxy statement to its shareholders. The procedures are as follows. The Registrant has a nominating and governance committee comprised solely of persons who are not considered ‘‘interested persons’’ of the Registrant within the meaning of the Investment Company Act of 1940, as amended. The committee periodically reviews such issues as the board’s composition, responsibilities, committees, compensation and other relevant issues, and recommends any appropriate changes to the full board of trustees. While the committee normally is able to identify from its own resources an ample number of qualified candidates, it will consider shareholder suggestions of persons to be considered as nominees to fill future vacancies on the board. Such suggestions must be sent in writing to the nominating and governance committee of the Registrant, c/o the Registrant’s Secretary, and must be accompanied by complete biographical and occupational data on the prospective nominee, along with a written consent of the prospective nominee for consideration of his or her name by the nominating and governance committee.
ITEM 11 – Controls and Procedures
| (a) | The Registrant’s Principal Executive Officer and Principal Financial Officer have concluded, based on their evaluation of the Registrant’s disclosure controls and procedures (as such term is defined in Rule 30a-3 under the Investment Company Act of 1940), that such controls and procedures are adequate and reasonably designed to achieve the purposes described in paragraph (c) of such rule. |
| (b) |
There were no changes in the Registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the Registrant’s semi-annual period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting.
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ITEM 12 – Exhibits
| (a)(1) | Not applicable for filing of semi-annual reports to shareholders. |
| (a)(2) | The certifications required by Rule 30a-2 of the Investment Company Act of 1940 and Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 are attached as exhibits hereto. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| AMERICAN FUNDS CORPORATE BOND FUND | |
| By __/s/ Kristine M. Nishiyama____________________ | |
|
Kristine M. Nishiyama, Executive Vice President and Principal Executive Officer | |
| Date: January 31, 2020 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
| By __/s/ Kristine M. Nishiyama_________________ |
|
Kristine M. Nishiyama, Executive Vice President and Principal Executive Officer |
| Date: January 31, 2020 |
| By ___/s/ Brian C. Janssen __________ |
|
Brian C. Janssen, Treasurer and Principal Financial Officer |
| Date: January 31, 2020 |