In a continued effort to restore liquidity to investors who purchased auction-rate securities issued by municipal closed-end funds, two major mutual fund families are the latest to announce plans to redeem outstanding ARS by using tender-option bonds - TOBs - as a new source of leverage.

Pittsburgh-based Federated Investors Inc. and Eaton Vance Management in Boston have both scheduled redemptions to take place later this month at $25,000 per share, plus the amount of accumulated, but unpaid, dividends as of the redemption date, according to press releases from each firm last week.

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