Edgar Filing: Western Asset Investment Grade Income Fund Inc.

Western Asset Income Fund (PAI)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number 811-02351

Western Asset Investment Grade Income Fund Inc.

(Exact name of registrant as specified in charter)

620 Eighth Avenue, 49^th Floor, New York, NY 10018

(Address of principal executive offices) (Zip code)

Robert I. Frenkel, Esq.

Legg Mason & Co., LLC

100 First Stamford Place

Stamford, CT 06902

(Name and address of agent for service)

Registrant’s telephone number, including area code: 1-888-777-0102

Date of fiscal year end: December 31

Date of reporting period: September 30, 2018

ITEM 1.

SCHEDULE OF INVESTMENTS.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.

FORM N-Q

SEPTEMBER 30, 2018

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
CORPORATE BONDS & NOTES - 86.9%
COMMUNICATION SERVICES - 10.5%
Diversified Telecommunication Services - 3.8%
AT&T Inc., Senior Notes		4.300	%		2/15/30	$	80,000	$	77,106	^(a)
AT&T Inc., Senior Notes		4.500	%		5/15/35		360,000		337,296
AT&T Inc., Senior Notes		6.350	%		3/15/40		50,000		55,151
AT&T Inc., Senior Notes		5.350	%		9/1/40		30,000		29,847
AT&T Inc., Senior Notes		4.800	%		6/15/44		210,000		194,360
AT&T Inc., Senior Notes		5.450	%		3/1/47		50,000		50,134
AT&T Inc., Senior Notes		4.550	%		3/9/49		310,000		273,098
AT&T Inc., Senior Notes (3 mo. USD LIBOR + 1.180%)		3.514	%		6/12/24		480,000		482,532	^(b)
British Telecommunications PLC, Senior Notes		9.625	%		12/15/30		330,000		469,667
Koninklijke KPN NV, Senior Notes		8.375	%		10/1/30		200,000		258,359
Telefonica Emisiones SAU, Senior Notes		7.045	%		6/20/36		60,000		72,580
Verizon Communications Inc., Senior Notes		5.150	%		9/15/23		1,790,000		1,918,201
Verizon Communications Inc., Senior Notes		5.500	%		3/16/47		730,000		802,321
Verizon Communications Inc., Senior Notes		5.012	%		8/21/54		139,000		140,276

Total Diversified Telecommunication Services									5,160,928

Media - 4.8%
21st Century Fox America Inc., Senior Notes		6.550	%		3/15/33		545,000		687,794
21st Century Fox America Inc., Senior Notes		7.750	%		12/1/45		130,000		199,793
CCO Holdings LLC/CCO Holdings Capital Corp., Senior Notes		5.125	%		5/1/27		420,000		399,000	^(a)
Charter Communications Operating LLC/Charter Communications Operating Capital Corp., Senior Secured Notes		6.384	%		10/23/35		110,000		118,613
Charter Communications Operating LLC/Charter Communications Operating Capital Corp., Senior Secured Notes		6.484	%		10/23/45		260,000		280,411
Charter Communications Operating LLC/Charter Communications Operating Capital Corp., Senior Secured Notes		5.375	%		5/1/47		350,000		332,802
Comcast Corp., Senior Notes		6.450	%		3/15/37		220,000		262,352
Comcast Corp., Senior Notes		6.950	%		8/15/37		160,000		197,943
Comcast Corp., Senior Notes		6.400	%		5/15/38		950,000		1,126,942
Time Warner Cable LLC, Senior Secured Notes		8.750	%		2/14/19		690,000		704,321
Time Warner Cable LLC, Senior Secured Notes		6.550	%		5/1/37		180,000		195,796
Time Warner Cable LLC, Senior Secured Notes		7.300	%		7/1/38		200,000		229,716
Time Warner Cable LLC, Senior Secured Notes		6.750	%		6/15/39		10,000		10,937
Time Warner Cable LLC, Senior Secured Notes		5.500	%		9/1/41		50,000		48,312

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
Media - (continued)
Time Warner Entertainment Co. LP, Senior Secured Notes		8.375	%		7/15/33	$	410,000	$	510,363
UBM PLC, Senior Notes		5.750	%		11/3/20		570,000		578,397	^(a)
Virgin Media Finance PLC, Senior Notes		6.375	%		4/15/23		600,000		617,250	^(a)
Warner Media LLC, Senior Notes		4.900	%		6/15/42		150,000		140,710

Total Media									6,641,452

Wireless Telecommunication Services - 1.9%
America Movil SAB de CV, Senior Notes		6.125	%		3/30/40		850,000		1,010,102
Sprint Communications Inc., Senior Notes		9.000	%		11/15/18		50,000		50,372	^(a)
Sprint Corp., Senior Notes		7.250	%		9/15/21		330,000		349,800
Sprint Corp., Senior Notes		7.875	%		9/15/23		340,000		367,625
Telefonica Europe BV, Senior Notes		8.250	%		9/15/30		230,000		294,917
Vodafone Group PLC, Senior Notes		5.250	%		5/30/48		490,000		493,805

Total Wireless Telecommunication Services									2,566,621

TOTAL COMMUNICATION SERVICES									14,369,001

CONSUMER DISCRETIONARY - 2.1%
Auto Components - 0.1%
ZF North America Capital Inc., Senior Notes		4.750	%		4/29/25		160,000		160,178	^(a)

Automobiles - 0.7%
Ford Motor Credit Co. LLC, Senior Notes		8.125	%		1/15/20		410,000		433,268
General Motors Co., Senior Notes		6.600	%		4/1/36		170,000		181,711
General Motors Co., Senior Notes		6.750	%		4/1/46		280,000		304,052

Total Automobiles									919,031

Hotels, Restaurants & Leisure - 1.0%
GLP Capital LP/GLP Financing II Inc., Senior Notes		5.250	%		6/1/25		160,000		163,392
GLP Capital LP/GLP Financing II Inc., Senior Notes		5.375	%		4/15/26		100,000		101,801
McDonald’s Corp., Senior Notes		4.700	%		12/9/35		150,000		156,376
McDonald’s Corp., Senior Notes		4.875	%		12/9/45		230,000		241,443
McDonald’s Corp., Senior Notes		4.450	%		9/1/48		10,000		9,845
Sands China Ltd., Senior Notes		5.125	%		8/8/25		450,000		449,630	^(a)
Sands China Ltd., Senior Notes		5.400	%		8/8/28		200,000		199,530	^(a)

Total Hotels, Restaurants & Leisure									1,322,017

Household Durables - 0.3%
Newell Brands Inc., Senior Notes		4.200	%		4/1/26		480,000		456,965

TOTAL CONSUMER DISCRETIONARY									2,858,191

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
CONSUMER STAPLES - 2.5%
Beverages - 1.4%
Anheuser-Busch InBev Finance Inc., Senior Notes		4.900	%		2/1/46	$	840,000	$	852,685
Pernod Ricard SA, Senior Notes		5.750	%		4/7/21		350,000		368,501	^(a)
Pernod Ricard SA, Senior Notes		5.500	%		1/15/42		670,000		745,186	^(a)

Total Beverages									1,966,372

Food & Staples Retailing - 0.1%
Kroger Co., Senior Notes		4.650	%		1/15/48		90,000		85,140

Food Products - 0.3%
Kraft Heinz Foods Co., Senior Notes		5.000	%		7/15/35		50,000		49,530
Kraft Heinz Foods Co., Senior Notes		5.000	%		6/4/42		150,000		143,711
Kraft Heinz Foods Co., Senior Notes		5.200	%		7/15/45		250,000		245,248

Total Food Products									438,489

Tobacco - 0.7%
Philip Morris International Inc., Senior Notes		4.500	%		3/20/42		100,000		97,642
Reynolds American Inc., Senior Notes		8.125	%		5/1/40		270,000		355,421
Reynolds American Inc., Senior Notes		7.000	%		8/4/41		320,000		381,128
Reynolds American Inc., Senior Notes		5.850	%		8/15/45		90,000		98,214

Total Tobacco									932,405

TOTAL CONSUMER STAPLES									3,422,406

ENERGY - 16.6%
Energy Equipment & Services - 0.5%
ENSCO International Inc., Senior Notes		7.200	%		11/15/27		120,000		113,100
Ensco PLC, Senior Notes		5.200	%		3/15/25		130,000		113,587
Halliburton Co., Senior Notes		5.000	%		11/15/45		200,000		214,396
Petrofac Ltd., Senior Notes		3.400	%		10/10/18		310,000		309,995	^(a)

Total Energy Equipment & Services									751,078

Oil, Gas & Consumable Fuels - 16.1%
Anadarko Finance Co., Senior Notes		7.500	%		5/1/31		465,000		571,674
Anadarko Petroleum Corp., Senior Notes		4.850	%		3/15/21		460,000		473,004
Anadarko Petroleum Corp., Senior Notes		5.550	%		3/15/26		460,000		488,827
Apache Corp., Senior Notes		6.000	%		1/15/37		106,000		116,165
Apache Corp., Senior Notes		5.100	%		9/1/40		160,000		158,763
Apache Corp., Senior Notes		5.250	%		2/1/42		90,000		90,772
Cenovus Energy Inc., Senior Notes		5.250	%		6/15/37		90,000		89,258
Cimarex Energy Co., Senior Notes		3.900	%		5/15/27		70,000		66,992
Concho Resources Inc., Senior Notes		3.750	%		10/1/27		70,000		66,940
Concho Resources Inc., Senior Notes		4.300	%		8/15/28		180,000		179,628
ConocoPhillips, Senior Notes		6.500	%		2/1/39		810,000		1,053,480

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
Oil, Gas & Consumable Fuels - (continued)
Continental Resources Inc., Senior Notes		4.375	%		1/15/28	$	280,000	$	278,433
Devon Energy Corp., Senior Notes		5.850	%		12/15/25		350,000		381,988
Devon Energy Corp., Senior Notes		5.600	%		7/15/41		320,000		340,466
Devon Energy Corp., Senior Notes		5.000	%		6/15/45		270,000		266,933
Ecopetrol SA, Senior Notes		5.375	%		6/26/26		740,000		764,975
Ecopetrol SA, Senior Notes		5.875	%		5/28/45		176,000		174,724
Enbridge Energy Partners LP, Senior Notes		9.875	%		3/1/19		120,000		123,200
Energy Transfer Equity LP, Senior Secured Notes		7.500	%		10/15/20		250,000		268,125
Energy Transfer Partners LP, Senior Notes		4.200	%		9/15/23		860,000		867,774
Energy Transfer Partners LP, Senior Notes		6.625	%		10/15/36		20,000		22,380
Energy Transfer Partners LP, Senior Notes		5.800	%		6/15/38		40,000		41,671
Enterprise Products Operating LLC, Senior Notes		6.125	%		10/15/39		320,000		375,574
Enterprise Products Operating LLC, Senior Notes		4.250	%		2/15/48		170,000		160,684
Enterprise Products Operating LLC, Senior Notes (5.375% to 2/15/28 then 3 mo. USD LIBOR + 2.570%)		5.375	%		2/15/78		540,000		502,268	^(b)
Hess Corp., Senior Notes		7.875	%		10/1/29		580,000		702,469
Hess Corp., Senior Notes		6.000	%		1/15/40		300,000		312,333
KazMunayGas National Co. JSC, Senior Notes		6.375	%		10/24/48		370,000		389,455	^(a)
Kerr-McGee Corp., Senior Notes		6.950	%		7/1/24		1,080,000		1,217,611
Kinder Morgan Inc., Medium-Term		7.800	%		8/1/31		2,000,000		2,496,457
Lukoil International Finance BV, Senior Notes		4.563	%		4/24/23		200,000		199,068	^(a)
MEG Energy Corp., Senior Notes		6.375	%		1/30/23		600,000		549,000	^(a)
MPLX LP, Senior Notes		4.500	%		4/15/38		380,000		359,285
Noble Energy Inc., Senior Notes		6.000	%		3/1/41		390,000		418,604
Noble Energy Inc., Senior Notes		5.250	%		11/15/43		150,000		148,460
Noble Energy Inc., Senior Notes		4.950	%		8/15/47		390,000		374,885
Petrobras Global Finance BV, Senior Notes		7.375	%		1/17/27		190,000		192,783
Petrobras Global Finance BV, Senior Notes		6.850	%		6/5/2115		300,000		258,000
Petroleos Mexicanos, Senior Notes		6.875	%		8/4/26		450,000		475,830
Petroleos Mexicanos, Senior Notes		6.625	%		6/15/35		2,635,000		2,631,047
Phillips 66, Senior Notes		5.875	%		5/1/42		160,000		184,727
Shell International Finance BV, Senior Notes		6.375	%		12/15/38		250,000		323,574
Transcontinental Gas Pipe Line Co., LLC, Senior Notes		7.850	%		2/1/26		470,000		573,307
Transcontinental Gas Pipe Line Co., LLC, Senior Notes		5.400	%		8/15/41		310,000		333,732
Western Gas Partners LP, Senior Notes		4.650	%		7/1/26		660,000		647,963
Western Gas Partners LP, Senior Notes		4.750	%		8/15/28		440,000		432,382

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
Oil, Gas & Consumable Fuels - (continued)
Williams Cos. Inc., Senior Notes		7.500	%		1/15/31	$	47,000	$	57,279
Williams Cos. Inc., Senior Notes		7.750	%		6/15/31		37,000		44,776
Williams Cos. Inc., Senior Notes		8.750	%		3/15/32		610,000		815,629

Total Oil, Gas & Consumable Fuels									22,063,354

TOTAL ENERGY									22,814,432

FINANCIALS - 30.8%
Banks - 18.4%
Banco Nacional de Costa Rica, Senior Notes		5.875	%		4/25/21		340,000		338,941	^(a)
Banco Santander SA, Senior Notes		3.848	%		4/12/23		400,000		391,200
Bank of America Corp., Senior Notes		5.875	%		2/7/42		320,000		379,333
Bank of America Corp., Senior Notes (3.004% to 12/20/22 then 3 mo. USD LIBOR + 0.790%)		3.004	%		12/20/23		107,000		103,898	^(b)
Bank of America Corp., Senior Notes (4.271% to 7/23/28 then 3 mo. USD LIBOR + 1.310%)		4.271	%		7/23/29		440,000		439,994	^(b)
Bank of America Corp., Subordinated Notes		6.110	%		1/29/37		320,000		369,076
Bank of America Corp., Subordinated Notes		7.750	%		5/14/38		900,000		1,218,259
Barclays Bank PLC, Subordinated Notes		10.179	%		6/12/21		240,000		273,578	^(a)
Barclays Bank PLC, Subordinated Notes		7.625	%		11/21/22		450,000		488,644
Barclays PLC, Junior Subordinated Notes (7.750% to 9/15/23 then USD 5 year Swap Rate + 4.842%)		7.750	%		9/15/23		330,000		331,650	^(b)(c)
Barclays PLC, Senior Notes (4.338% to 5/16/23 then 3 mo. USD LIBOR + 1.356%)		4.338	%		5/16/24		380,000		375,787	^(b)
Barclays PLC, Senior Notes (4.972% to 5/16/28 then 3 mo. USD LIBOR + 1.902%)		4.972	%		5/16/29		260,000		256,498	^(b)
Barclays PLC, Subordinated Notes		4.836	%		5/9/28		240,000		225,590
BBVA Bancomer SA, Subordinated Notes (5.125% to 1/18/28 then 5 year Treasury Constant Maturity Rate + 2.650%)		5.125	%		1/18/33		320,000		292,400	^(a)(b)
BNP Paribas SA, Junior Subordinated Notes (7.000% to 8/16/28 then USD 5 year Swap Rate + 3.980%)		7.000	%		8/16/28		220,000		222,035	^(a)(b)(c)
BNP Paribas SA, Junior Subordinated Notes (7.625% to 3/30/21 then USD 5 year Swap Rate + 6.314%)		7.625	%		3/30/21		330,000		347,325	^(a)(b)(c)
BNP Paribas SA, Senior Notes		4.400	%		8/14/28		280,000		275,318	^(a)
BNP Paribas SA, Subordinated Notes		4.625	%		3/13/27		220,000		217,532	^(a)
BPCE SA, Subordinated Notes		5.150	%		7/21/24		410,000		417,501	^(a)
Citigroup Inc., Senior Notes		8.125	%		7/15/39		251,000		363,380
Citigroup Inc., Senior Notes		5.875	%		1/30/42		240,000		279,861

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
Banks - (continued)
Citigroup Inc., Subordinated Notes		5.500	%		9/13/25	$	750,000	$	800,157
Citigroup Inc., Subordinated Notes		4.450	%		9/29/27		400,000		395,813
Citigroup Inc., Subordinated Notes		6.125	%		8/25/36		404,000		461,713
Citigroup Inc., Subordinated Notes		6.675	%		9/13/43		370,000		455,106
Cooperatieve Rabobank U.A., Senior Notes		5.250	%		5/24/41		570,000		641,278
Cooperatieve Rabobank U.A., Senior Notes		5.750	%		12/1/43		450,000		504,264
Cooperatieve Rabobank U.A., Senior Notes		5.250	%		8/4/45		340,000		358,426
Cooperatieve Rabobank UA, Junior Subordinated Notes (11.000% to 6/30/19 then 3 mo. USD LIBOR + 10.868%)		11.000	%		6/30/19		708,000		749,949	^(a)(b)(c)
Credit Agricole SA, Junior Subordinated Notes (8.125% to 12/23/25 then USD 5 year Swap Rate + 6.185%)		8.125	%		12/23/25		1,040,000		1,146,585	^(a)(b)(c)
Credit Agricole SA, Junior Subordinated Notes (8.375% to 10/13/19 then 3 mo. USD LIBOR + 6.982%)		8.375	%		10/13/19		560,000		584,010	^(a)(b)(c)
HSBC Holdings PLC, Junior Subordinated Notes (6.500% to 3/23/28 then USD 5 year ICE Swap Rate + 3.606%)		6.500	%		3/23/28		300,000		289,875	^(b)(c)
HSBC Holdings PLC, Subordinated Notes		4.250	%		8/18/25		210,000		206,332
ING Bank NV, Subordinated Notes		5.800	%		9/25/23		600,000		633,291	^(a)
Intesa Sanpaolo SpA, Senior Notes		3.125	%		7/14/22		300,000		279,006	^(a)
Intesa Sanpaolo SpA, Senior Notes		3.875	%		7/14/27		360,000		307,779	^(a)
Intesa Sanpaolo SpA, Subordinated Notes		5.710	%		1/15/26		690,000		628,593	^(a)
JPMorgan Chase & Co., Junior Subordinated Notes (6.000% to 8/1/23 then 3 mo. USD LIBOR + 3.300%)		6.000	%		8/1/23		260,000		270,725	^(b)(c)
JPMorgan Chase & Co., Subordinated Notes		5.625	%		8/16/43		440,000		501,732
JPMorgan Chase & Co., Subordinated Notes		4.950	%		6/1/45		410,000		430,916
Lloyds Banking Group PLC, Junior Subordinated Notes (7.500% to 6/27/24 then USD 5 year Swap Rate + 4.760%)		7.500	%		6/27/24		360,000		372,150	^(b)(c)
NatWest Markets NV, Subordinated Notes		7.750	%		5/15/23		480,000		531,439
Royal Bank of Scotland Group PLC, Junior Subordinated Notes (7.648% to 9/30/31 then 3 mo. USD LIBOR + 2.500%)		7.648	%		9/30/31		1,360,000		1,708,500	^(b)(c)
Royal Bank of Scotland Group PLC, Junior Subordinated Notes (8.625% to 8/15/21 then USD 5 year Swap Rate + 7.598%)		8.625	%		8/15/21		590,000		633,513	^(b)(c)

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
Banks - (continued)
Royal Bank of Scotland Group PLC, Senior Notes (4.892% to 5/18/28 then 3 mo. USD LIBOR + 1.754%)		4.892	%		5/18/29	$	200,000	$	199,148	^(b)
Royal Bank of Scotland Group PLC, Subordinated Notes		6.100	%		6/10/23		1,010,000		1,054,862
Royal Bank of Scotland Group PLC, Subordinated Notes		6.000	%		12/19/23		350,000		364,518
Santander UK Group Holdings PLC,
Subordinated Notes		4.750	%		9/15/25		210,000		205,014	^(a)
Standard Chartered PLC, Subordinated Notes		5.700	%		3/26/44		410,000		426,032	^(a)
Wachovia Capital Trust III, Junior Subordinated Bonds (the greater of 3 mo. USD LIBOR + 0.930% or 5.570%)		5.570	%		10/29/18		1,190,000		1,180,183	^(b)(c)
Wells Fargo & Co., Senior Notes		3.000	%		10/23/26		310,000		287,968
Wells Fargo & Co., Subordinated Notes		5.375	%		11/2/43		430,000		462,943
Wells Fargo & Co., Subordinated Notes		4.750	%		12/7/46		580,000		579,115

Total Banks									25,258,735

Capital Markets - 5.2%
CME Group Inc., Senior Notes		5.300	%		9/15/43		440,000		507,959
Credit Suisse Group AG, Junior Subordinated Notes (6.250% to 12/18/24 then USD 5 year Swap Rate + 3.455%)		6.250	%		12/18/24		1,170,000		1,156,837	^(a)(b)(c)
Credit Suisse Group AG, Junior Subordinated Notes (7.250% to 9/12/25 then USD 5 year Swap Rate + 4.332%)		7.250	%		9/12/25		400,000		402,500	^(a)(b)(c)
Goldman Sachs Group Inc., Senior Notes		5.375	%		3/15/20		270,000		278,372
Goldman Sachs Group Inc., Senior Notes		6.250	%		2/1/41		570,000		686,431
Goldman Sachs Group Inc., Subordinated Notes		6.750	%		10/1/37		640,000		771,212
Goldman Sachs Group Inc., Subordinated Notes		5.150	%		5/22/45		500,000		511,404
Intercontinental Exchange Inc., Senior Notes		3.750	%		9/21/28		640,000		633,615
KKR Group Finance Co. III LLC, Senior Notes		5.125	%		6/1/44		820,000		815,890	^(a)
Moody’s Corp, Senior Notes		2.750	%		12/15/21		500,000		489,390
Morgan Stanley, Senior Notes		5.500	%		7/24/20		100,000		103,798
Morgan Stanley, Senior Notes		6.375	%		7/24/42		90,000		112,587
Raymond James Financial Inc., Senior Notes		4.950	%		7/15/46		90,000		91,705
Societe Generale SA, Junior Subordinated Notes (6.750% to 4/6/28 then USD 5 year Swap Rate + 3.929%)		6.750	%		4/6/28		200,000		186,850	^(a)(b)(c)
UBS AG Stamford, CT, Subordinated Notes		7.625	%		8/17/22		340,000		379,610

Total Capital Markets									7,128,160

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
Consumer Finance - 1.7%
Ally Financial Inc., Subordinated Notes		8.000	%		12/31/18	$	201,000	$	203,261
Nationwide Building Society, Senior Notes (3 mo. USD LIBOR + 1.392%)		4.363	%		8/1/24		210,000		209,126	^(a)(b)
Navient Corp., Senior Notes		7.250	%		1/25/22		830,000		878,763
Navient Corp., Senior Notes		6.125	%		3/25/24		290,000		291,450
Synchrony Financial, Senior Notes		3.700	%		8/4/26		856,000		774,428

Total Consumer Finance									2,357,028

Diversified Financial Services - 1.8%
Carlyle Finance LLC, Senior Notes		5.650	%		9/15/48		110,000		110,563	^(a)
Carlyle Holdings II Finance LLC, Senior Notes		5.625	%		3/30/43		220,000		217,869	^(a)
ILFC E-Capital Trust I, Junior Subordinated Notes ((Highest of 3 mo. USD LIBOR, 10 year U.S. Treasury Constant Maturity Rate and 30 year U.S. Treasury Constant Maturity Rate) + 1.550%)		4.780	%		12/21/65		470,000		428,875	^(a)(b)
ILFC E-Capital Trust II, Senior Notes ((Highest of 3 mo. USD LIBOR, 10 year U.S. Treasury Constant Maturity Rate and 30 year U.S. Treasury Constant Maturity Rate) + 1.800%)		5.030	%		12/21/65		270,000		245,700	^(a)(b)
International Lease Finance Corp., Senior Notes		6.250	%		5/15/19		130,000		132,549
International Lease Finance Corp., Senior Notes		8.250	%		12/15/20		190,000		207,732
Park Aerospace Holdings Ltd., Senior Notes		5.250	%		8/15/22		392,000		396,900	^(a)
Park Aerospace Holdings Ltd., Senior Notes		5.500	%		2/15/24		220,000		226,050	^(a)
Voya Financial Inc., Senior Notes		5.700	%		7/15/43		500,000		550,499

Total Diversified Financial Services									2,516,737

Insurance - 3.7%
Allstate Corp., Junior Subordinated Notes (6.500% to 5/15/37 then 3 mo. USD LIBOR + 2.120%)		6.500	%		5/15/57		480,000		534,000	^(b)
American International Group Inc., Junior Subordinated Notes (6.250% to 3/15/37 then 3 mo. USD LIBOR + 2.056%)		6.250	%		3/15/87		80,000		80,600	^(b)
American International Group Inc., Senior Notes		6.400	%		12/15/20		90,000		95,807
American International Group Inc., Senior Notes		4.750	%		4/1/48		70,000		69,085
Aon PLC, Senior Notes		4.750	%		5/15/45		90,000		90,373
AXA SA, Subordinated Notes		8.600	%		12/15/30		200,000		260,500
Berkshire Hathaway Finance Corp., Senior Notes		4.200	%		8/15/48		480,000		477,994
Brighthouse Financial Inc., Senior Notes		3.700	%		6/22/27		40,000		35,574
Delphi Financial Group Inc., Senior Notes		7.875	%		1/31/20		170,000		179,567

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
Insurance - (continued)
Fidelity & Guaranty Life Holdings Inc., Senior Notes		5.500	%		5/1/25	$	230,000	$	229,126	^(a)
Liberty Mutual Group Inc., Senior Notes		7.800	%		3/15/37		190,000		222,775	^(a)
Liberty Mutual Insurance Co., Subordinated Notes		7.875	%		10/15/26		490,000		594,778	^(a)
Massachusetts Mutual Life Insurance Co., Subordinated Notes		4.900	%		4/1/77		260,000		257,332	^(a)
MetLife Inc., Junior Subordinated Notes		6.400	%		12/15/36		1,150,000		1,221,875
Nuveen Finance LLC, Senior Notes		2.950	%		11/1/19		210,000		209,767	^(a)
Teachers Insurance & Annuity Association of America, Subordinated Notes		6.850	%		12/16/39		400,000		525,947	^(a)

Total Insurance									5,085,100

TOTAL FINANCIALS									42,345,760

HEALTH CARE - 7.0%
Biotechnology - 0.7%
AbbVie Inc., Senior Notes		2.500	%		5/14/20		430,000		425,348
AbbVie Inc., Senior Notes		4.700	%		5/14/45		180,000		173,585
Celgene Corp., Senior Notes		5.000	%		8/15/45		250,000		249,353
Gilead Sciences Inc., Senior Notes		5.650	%		12/1/41		60,000		69,103
Gilead Sciences Inc., Senior Notes		4.750	%		3/1/46		50,000		51,656

Total Biotechnology									969,045

Health Care Equipment & Supplies - 1.0%
Abbott Laboratories, Senior Notes		2.900	%		11/30/21		540,000		533,649
Abbott Laboratories, Senior Notes		4.900	%		11/30/46		230,000		250,766
Becton Dickinson & Co., Senior Notes		4.685	%		12/15/44		200,000		197,938
Becton Dickinson & Co., Senior Notes		4.669	%		6/6/47		410,000		407,108

Total Health Care Equipment & Supplies									1,389,461

Health Care Providers & Services - 4.8%
Cardinal Health Inc., Senior Notes		3.410	%		6/15/27		270,000		249,650
CVS Health Corp., Senior Notes		4.100	%		3/25/25		940,000		938,806
CVS Health Corp., Senior Notes		4.300	%		3/25/28		540,000		536,799
CVS Health Corp., Senior Notes		4.780	%		3/25/38		1,330,000		1,327,795
CVS Health Corp., Senior Notes		5.125	%		7/20/45		340,000		350,805
CVS Health Corp., Senior Notes		5.050	%		3/25/48		730,000		749,539
Dartmouth-Hitchcock Health, Secured Bonds		4.178	%		8/1/48		100,000		96,766
Halfmoon Parent Inc., Senior Secured Notes		4.125	%		11/15/25		340,000		339,550	^(a)
Halfmoon Parent Inc., Senior Secured Notes		4.375	%		10/15/28		340,000		339,693	^(a)
Halfmoon Parent Inc., Senior Secured Notes		4.800	%		8/15/38		340,000		342,024	^(a)
HCA Inc., Senior Secured Notes		5.500	%		6/15/47		370,000		376,012

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
Health Care Providers & Services - (continued)
Humana Inc., Senior Notes		8.150	%		6/15/38	$	80,000	$	109,049
Humana Inc., Senior Notes		4.800	%		3/15/47		230,000		235,491
Magellan Health Inc., Senior Notes		4.400	%		9/22/24		420,000		406,341
Orlando Health Obligated Group, Senior Notes		4.089	%		10/1/48		170,000		164,367

Total Health Care Providers & Services									6,562,687

Pharmaceuticals - 0.5%
Allergan Funding SCS, Senior Notes		4.550	%		3/15/35		190,000		185,343
Allergan Funding SCS, Senior Notes		4.750	%		3/15/45		200,000		195,170
Bausch Health Cos. Inc., Senior Notes		9.000	%		12/15/25		320,000		345,600	^(a)
Zoetis Inc., Senior Notes		4.700	%		2/1/43		30,000		30,811

Total Pharmaceuticals									756,924

TOTAL HEALTH CARE									9,678,117

INDUSTRIALS - 5.1%
Aerospace & Defense - 1.5%
Avolon Holdings Funding Ltd., Senior Notes		5.125	%		10/1/23		210,000		212,789	^(a)
Huntington Ingalls Industries Inc., Senior Notes		3.483	%		12/1/27		200,000		187,820
Lockheed Martin Corp., Senior Notes		4.500	%		5/15/36		40,000		41,820
Northrop Grumman Systems Corp., Senior Notes		7.875	%		3/1/26		870,000		1,065,348
United Technologies Corp., Senior Notes		4.125	%		11/16/28		510,000		507,556
United Technologies Corp., Senior Notes		4.625	%		11/16/48		110,000		111,058

Total Aerospace & Defense									2,126,391

Airlines - 0.5%
Continental Airlines 1999-1 Class A Pass Through Trust, Senior Secured Notes		6.545	%		2/2/19		31,870		32,249
Continental Airlines 2009-2 Class A Pass Through Trust, Senior Secured Notes		7.250	%		11/10/19		134,052		139,331
Continental Airlines 2012-1 Class B Pass Through Trust, Senior Secured Notes		6.250	%		4/11/20		83,850		85,979
Continental Airlines Pass Through Trust 1999-2, Class A-1, Senior Secured Notes		7.256	%		3/15/20		39,796		40,940
Delta Air Lines 2007-1 Class B Pass Through Trust, Senior Secured Notes		8.021	%		8/10/22		47,811		52,525	^(d)
Delta Air Lines 2009-1 Class A Pass Through Trust, Senior Secured Notes		7.750	%		12/17/19		82,257		85,946
US Airways 2012-1 Class A Pass Through Trust, Senior Secured Notes		5.900	%		10/1/24		248,880		267,546

Total Airlines									704,516

Commercial Services & Supplies - 1.1%
Republic Services Inc., Senior Notes		5.500	%		9/15/19		130,000		133,063
Republic Services Inc., Senior Notes		5.250	%		11/15/21		330,000		347,488

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
Commercial Services & Supplies - (continued)
Taylor Morrison Communities Inc./Taylor Morrison Holdings II Inc., Senior Notes		5.250	%		4/15/21	$	320,000	$	322,400	^(a)
Waste Management Holdings Inc., Senior Notes		7.100	%		8/1/26		260,000		314,507
Waste Management Inc., Senior Notes		7.750	%		5/15/32		250,000		331,995

Total Commercial Services & Supplies									1,449,453

Industrial Conglomerates - 1.3%
General Electric Co., Junior Subordinated Notes (5.000% to 1/21/21 then 3 mo. USD LIBOR + 3.330%)		5.000	%		1/21/21		710,000		692,605	^(b)(c)
General Electric Co., Senior Notes		6.875	%		1/10/39		716,000		895,894
General Electric Co., Subordinated Notes		5.300	%		2/11/21		138,000		143,849

Total Industrial Conglomerates									1,732,348

Machinery - 0.2%
Caterpillar Inc., Senior Notes		4.750	%		5/15/64		220,000		228,670
Wabtec Corp., Senior Notes		4.150	%		3/15/24		60,000		59,650

Total Machinery									288,320

Road & Rail - 0.2%
Union Pacific Corp., Senior Notes		4.500	%		9/10/48		30,000		30,722
Union Pacific Corp., Senior Notes		4.375	%		11/15/65		320,000		297,596

Total Road & Rail									328,318

Transportation Infrastructure - 0.3%
SMBC Aviation Capital Finance DAC, Senior Notes		4.125	%		7/15/23		350,000		350,814	^(a)

TOTAL INDUSTRIALS									6,980,160

INFORMATION TECHNOLOGY - 2.5%
Communications Equipment - 0.4%
Harris Corp., Senior Notes		4.854	%		4/27/35		260,000		267,578
Harris Corp., Senior Notes		5.054	%		4/27/45		210,000		221,764

Total Communications Equipment									489,342

Semiconductors & Semiconductor Equipment - 0.1%
Intel Corp., Senior Notes		4.900	%		7/29/45		130,000		144,327

Software - 0.8%
Microsoft Corp., Senior Notes		4.250	%		2/6/47		970,000		1,021,046
salesforce.com Inc., Senior Notes		3.700	%		4/11/28		100,000		99,263

Total Software									1,120,309

Technology Hardware, Storage & Peripherals - 1.2%
Apple Inc., Senior Notes		3.850	%		8/4/46		340,000		326,868
Dell International LLC/EMC Corp., Senior Secured Notes		4.420	%		6/15/21		620,000		629,734	^(a)

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
Technology Hardware, Storage & Peripherals - (continued)
HP Inc., Senior Notes		4.650	%		12/9/21	$	310,000	$	319,353
Seagate HDD Cayman, Senior Notes		4.250	%		3/1/22		420,000		417,703

Total Technology Hardware, Storage & Peripherals									1,693,658

TOTAL INFORMATION TECHNOLOGY									3,447,636

MATERIALS - 6.7%
Chemicals - 1.0%
Dow Chemical Co., Senior Notes		7.375	%		11/1/29		800,000		1,003,654
Syngenta Finance NV, Senior Notes		4.892	%		4/24/25		230,000		226,078	^(a)
Syngenta Finance NV, Senior Notes		5.676	%		4/24/48		200,000		180,371	^(a)

Total Chemicals									1,410,103

Metals & Mining - 5.5%
Alcoa Nederland Holding BV, Senior Notes		6.750	%		9/30/24		250,000		265,625	^(a)
Alcoa Nederland Holding BV, Senior Notes		6.125	%		5/15/28		800,000		824,000	^(a)
Anglo American Capital PLC, Senior Notes		4.000	%		9/11/27		500,000		461,527	^(a)
ArcelorMittal, Senior Notes		5.125	%		6/1/20		70,000		71,717
ArcelorMittal, Senior Notes		6.125	%		6/1/25		50,000		54,399
Barrick North America Finance LLC, Senior Notes		5.700	%		5/30/41		50,000		54,252
Barrick PD Australia Finance Pty Ltd., Senior Notes		5.950	%		10/15/39		180,000		197,977
BHP Billiton Finance USA Ltd., Senior Notes		5.000	%		9/30/43		100,000		111,256
BHP Billiton Finance USA Ltd., Senior Notes (6.750% to 10/20/25 then USD 5 year Swap Rate + 5.093%)		6.750	%		10/19/75		470,000		516,412	^(a)(b)
First Quantum Minerals Ltd., Senior Notes		7.000	%		2/15/21		230,000		227,844	^(a)
Freeport-McMoRan Inc., Senior Notes		3.550	%		3/1/22		60,000		58,200
Freeport-McMoRan Inc., Senior Notes		6.875	%		2/15/23		630,000		674,100
Glencore Finance Canada Ltd., Senior Notes		6.900	%		11/15/37		430,000		480,786	^(a)
Glencore Finance Canada, Ltd., Senior Notes		5.550	%		10/25/42		150,000		148,475	^(a)
Glencore Funding LLC, Senior Notes		4.000	%		3/27/27		560,000		526,558	^(a)
Glencore Funding LLC, Senior Notes		3.875	%		10/27/27		170,000		158,031	^(a)
Northwest Acquisitions ULC/Dominion Finco Inc., Senior Secured Notes		7.125	%		11/1/22		380,000		389,500	^(a)
Southern Copper Corp., Senior Notes		5.375	%		4/16/20		150,000		154,728
Southern Copper Corp., Senior Notes		5.250	%		11/8/42		470,000		476,770
Vale Overseas Ltd., Senior Notes		6.875	%		11/21/36		1,148,000		1,338,798
Yamana Gold Inc., Senior Notes		4.950	%		7/15/24		370,000		365,199

Total Metals & Mining									7,556,154

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
Paper & Forest Products - 0.2%
Georgia-Pacific LLC, Senior Notes		7.375	%		12/1/25	$	250,000	$	298,920

TOTAL MATERIALS									9,265,177

REAL ESTATE - 0.8%
Equity Real Estate Investment Trusts (REITs) - 0.6%
American Homes 4 Rent LP, Senior Notes		4.250	%		2/15/28		10,000		9,585
MPT Operating Partnership LP/MPT Finance Corp., Senior Notes		5.000	%		10/15/27		250,000		241,563
Washington Prime Group LP, Senior Notes		5.950	%		8/15/24		200,000		189,518
WEA Finance LLC, Senior Notes		4.125	%		9/20/28		340,000		337,327	^(a)

Total Equity Real Estate Investment Trusts (REITs)									777,993

Real Estate Management & Development - 0.2%
Security Capital Group Inc., Senior Notes		7.700	%		6/15/28		280,000		336,482

TOTAL REAL ESTATE									1,114,475

UTILITIES - 2.3%
Electric Utilities - 2.3%
CenterPoint Energy Houston Electric LLC, Senior Secured Bonds		4.500	%		4/1/44		210,000		221,833
Enel Finance International NV, Senior Notes		2.875	%		5/25/22		300,000		285,584	^(a)
FirstEnergy Corp., Senior Notes		3.900	%		7/15/27		310,000		302,110
FirstEnergy Corp., Senior Notes		7.375	%		11/15/31		830,000		1,073,726
Pacific Gas & Electric Co., Senior Notes		3.300	%		12/1/27		500,000		458,000
Pacific Gas & Electric Co., Senior Notes		6.050	%		3/1/34		130,000		148,146
Virginia Electric & Power Co., Senior Notes		8.875	%		11/15/38		390,000		607,521

TOTAL UTILITIES									3,096,920

TOTAL CORPORATE BONDS & NOTES (Cost - $113,048,162)									119,392,275

U.S. GOVERNMENT & AGENCY OBLIGATIONS - 6.1%
U.S. Government Obligations - 6.1%
U.S. Treasury Notes		2.625	%		8/31/20		2,300,000		2,291,959
U.S. Treasury Notes		2.750	%		8/31/23		3,380,000		3,350,755
U.S. Treasury Notes		2.875	%		9/30/23		230,000		229,223
U.S. Treasury Notes		2.875	%		7/31/25		120,000		118,992
U.S. Treasury Notes		2.750	%		8/31/25		200,000		196,739
U.S. Treasury Notes		2.875	%		8/15/28		1,855,000		1,826,704
U.S. Treasury Notes		3.125	%		5/15/48		430,000		424,373

TOTAL U.S. GOVERNMENT & AGENCY OBLIGATIONS (Cost - $8,446,071)									8,438,745

SOVEREIGN BONDS - 4.1%
Argentina - 2.0%
Argentine Republic Government International Bond, Senior Notes		7.500	%		4/22/26		370,000		330,780

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
Argentina - (continued)
Argentine Republic Government International Bond, Senior Notes		6.875	%		1/26/27	$	120,000	$	102,300
Argentine Republic Government International Bond, Senior Notes		5.875	%		1/11/28		390,000		309,660
Argentine Republic Government International Bond, Senior Notes		7.625	%		4/22/46		150,000		122,214
Argentine Republic Government International Bond, Senior Notes		6.875	%		1/11/48		150,000		116,250
Provincia de Buenos Aires, Senior Notes		9.125	%		3/16/24		1,220,000		1,129,598	^(a)
Provincia de Cordoba, Senior Notes		7.450	%		9/1/24		740,000		638,398	^(a)

Total Argentina									2,749,200

Canada - 0.7%
Province of Quebec Canada, Senior Notes, Step Bond		7.970	%		7/22/36		650,000		979,854

Ecuador - 0.5%
Ecuador Government International Bond, Senior Notes		10.750	%		3/28/22		610,000		650,412	^(a)

Indonesia - 0.3%
Indonesia Government International Bond, Senior Notes		4.350	%		1/11/48		440,000		403,531

Mexico - 0.2%
Mexico Government International Bond, Senior Notes		4.350	%		1/15/47		360,000		327,604

United Arab Emirates - 0.3%
Abu Dhabi Government International Bond, Senior Notes		4.125	%		10/11/47		440,000		421,344	^(a)

Uruguay - 0.1%
Uruguay Government International Bond, Senior Notes		4.975	%		4/20/55		70,000		70,175

TOTAL SOVEREIGN BONDS (Cost - $5,820,981)									5,602,120

MUNICIPAL BONDS - 1.3%
Alabama - 0.2%
Alabama Economic Settlement Authority, BP Settlement Revenue, Series B		3.163	%		9/15/25		280,000		275,036

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018


SECURITY	RATE			MATURITY DATE		FACE AMOUNT		VALUE
California - 0.8%
Los Angeles County Public Works Financing Authority Revenue, Multiple Capital Projects I, Series 2010 B, Taxable Build America Bonds		7.618	%		8/1/40	$	650,000	$	940,270
University of California Revenue, Taxable, General Series AG		4.062	%		5/15/33		150,000		151,485

Total California									1,091,755

Florida - 0.1%
Sumter Landing Community Development District Recreational Revenue, Taxable Community Development District		4.172	%		10/1/47		170,000		168,560

Illinois - 0.2%
State of Illinois, GO Build America Bonds-Taxable		6.725	%		4/1/35		310,000		329,592

TOTAL MUNICIPAL BONDS (Cost - $1,876,802)									1,864,943


						SHARES
PREFERRED STOCKS - 0.3%
FINANCIALS - 0.3%
Capital Markets - 0.2%
Carlyle Group LP		5.875	%				10,775		243,946

Insurance - 0.1%
Delphi Financial Group Inc. (3 mo. USD LIBOR + 3.190%)		5.504	%				5,725		132,391	^(b)

TOTAL PREFERRED STOCKS (Cost - $412,443)									376,337

TOTAL INVESTMENTS BEFORE SHORT-TERM INVESTMENTS (Cost - $129,604,459)									135,674,420

SHORT-TERM INVESTMENTS - 0.4%
Western Asset Government Cash Management Portfolio LLC (Cost - $502,094)		2.100	%				502,094		502,094	^(e)

TOTAL INVESTMENTS - 99.1% (Cost - $130,106,553)									136,176,514
Other Assets in Excess of Liabilities - 0.9%									1,231,192

TOTAL NET ASSETS - 100.0%								$	137,407,706

See Notes to Schedule of Investments.

WESTERN ASSET INVESTMENT GRADE INCOME FUND INC.


Schedule of investments (unaudited) (cont’d)		September 30, 2018

(a)

Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. This security has been deemed liquid pursuant to guidelines approved by the Board of Directors.

(b)

Variable rate security. Interest rate disclosed is as of the most recent information available. Certain variable rate securities are not based on a published reference rate and spread but are determined by the issuer or agent and are based on current market conditions. These securities do not indicate a reference rate and spread in their description above.

(c)	Security has no maturity date. The date shown represents the next call date. (d) Security is valued using significant unobservable inputs (Note 1).

(e)

In this instance, as defined in the Investment Company Act of 1940, an “Affiliated Company” represents Fund ownership of at least 5% of the outstanding voting securities of an issuer, or a company which is under common ownership or control. At September 30, 2018, the total market value of investments in Affiliated Companies was $502,094 and the cost was $502,094 (Note 2).

Abbreviations used in this schedule:


GO		— General Obligation
ICE		— Intercontinental Exchange
JSC		— Joint Stock Company
LIBOR		— London Interbank Offered Rate

At September 30, 2018, the Fund had the following open futures contracts:


	Number of Contracts		Expiration Date		Notional Amount		Market Value		Unrealized Appreciation (Depreciation)
Contracts to Buy:
U.S. Treasury 2-Year Notes		31		12/18	$	6,535,212	$	6,532,766	$	(2,446	)
U.S. Treasury 5-Year Notes		26		12/18		2,944,867		2,924,391		(20,476	)
U.S. Treasury Ultra Long-Term Bonds		16		12/18		2,561,093		2,468,500		(92,593	)

										(115,515	)

Contracts to Sell:
U.S. Treasury 10-Year Notes		74		12/18		8,899,436		8,789,813		109,623
U.S. Treasury Long-Term Bonds		95		12/18		13,650,189		13,347,500		302,689

										412,312

Net unrealized appreciation on open futures contracts									$	296,797

This Schedule of Investments is unaudited and is intended to provide information about the Fund’s investments as of the date of the schedule. Other information regarding the Fund is available in the Fund’s most recent annual or semi-annual shareholder report.

See Notes to Schedule of Investments.

Notes to Schedule of Investments (unaudited)

1. Organization and significant accounting policies

Western Asset Investment Grade Income Fund Inc. (the “Fund”) (formerly Western Asset Income Fund), is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as a closed-end diversified investment company. The Fund seeks a high level of current income, consistent with prudent investment risk. Capital appreciation is a secondary investment objective.

The following are significant accounting policies consistently followed by the Fund and are in conformity with U.S. generally accepted accounting principles (“GAAP”).

(a) Investment valuation. The valuations for fixed income securities (which may include, but are not limited to, corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and certain derivative instruments are typically the prices supplied by independent third party pricing services, which may use market prices or broker/dealer quotations or a variety of valuation techniques and methodologies. The independent third party pricing services use inputs that are observable such as issuer details, interest rates, yield curves, prepayment speeds, credit risks/spreads, default rates and quoted prices for similar securities. Investments in open-end funds are valued at the closing net asset value per share of each fund on the day of valuation. Futures contracts are valued daily at the settlement price established by the board of trade or exchange on which they are traded. Equity securities for which market quotations are available are valued at the last reported sales price or official closing price on the primary market or exchange on which they trade. When the Fund holds securities or other assets that are denominated in a foreign currency, the Fund will normally use the currency exchange rates as of 4:00 p.m. (Eastern Time). If independent third party pricing services are unable to supply prices for a portfolio investment, or if the prices supplied are deemed by the manager to be unreliable, the market price may be determined by the manager using quotations from one or more broker/dealers or at the transaction price if the security has recently been purchased and no value has yet been obtained from a pricing service or pricing broker. When reliable prices are not readily available, such as when the value of a security has been significantly affected by events after the close of the exchange or market on which the security is principally traded, but before the Fund calculates its net asset value, the Fund values these securities as determined in accordance with procedures approved by the Fund’s Board of Directors.

The Board of Directors is responsible for the valuation process and has delegated the supervision of the daily valuation process to the Legg Mason North Atlantic Fund Valuation Committee (the “Valuation Committee”). The Valuation Committee, pursuant to the policies adopted by the Board of Directors, is responsible for making fair value determinations, evaluating the effectiveness of the Fund’s pricing policies, and reporting to the Board of Directors. When determining the reliability of third party pricing information for investments owned by the Fund, the Valuation Committee, among other things, conducts due diligence reviews of pricing vendors, monitors the daily change in prices and reviews transactions among market participants.

Notes to Schedule of Investments (unaudited) (continued)

The Valuation Committee will consider pricing methodologies it deems relevant and appropriate when making fair value determinations. Examples of possible methodologies include, but are not limited to, multiple of earnings; discount from market of a similar freely traded security; discounted cash-flow analysis; book value or a multiple thereof; risk premium/yield analysis; yield to maturity; and/or fundamental investment analysis. The Valuation Committee will also consider factors it deems relevant and appropriate in light of the facts and circumstances. Examples of possible factors include, but are not limited to, the type of security; the issuer’s financial statements; the purchase price of the security; the discount from market value of unrestricted securities of the same class at the time of purchase; analysts’ research and observations from financial institutions; information regarding any transactions or offers with respect to the security; the existence of merger proposals or tender offers affecting the security; the price and extent of public trading in similar securities of the issuer or comparable companies; and the existence of a shelf registration for restricted securities.

For each portfolio security that has been fair valued pursuant to the policies adopted by the Board of Directors, the fair value price is compared against the last available and next available market quotations. The Valuation Committee reviews the results of such back testing monthly and fair valuation occurrences are reported to the Board of Directors quarterly.

The Fund uses valuation techniques to measure fair value that are consistent with the market approach and/or income approach, depending on the type of security and the particular circumstance. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable securities. The income approach uses valuation techniques to discount estimated future cash flows to present value.

GAAP establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are summarized in the three broad levels listed below:

•

Level 1 – quoted prices in active markets for identical investments

•

Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

•

Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)

The inputs or methodologies used to value securities are not necessarily an indication of the risk associated with investing in those securities.

Notes to Schedule of Investments (unaudited) (continued)

The following is a summary of the inputs used in valuing the Fund’s assets and liabilities carried at fair value:


ASSETS
DESCRIPTION	QUOTED PRICES (LEVEL 1)		OTHER SIGNIFICANT OBSERVABLE INPUTS (LEVEL 2)		SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3)		TOTAL
Long-Term Investments†:
Corporate Bonds & Notes:
Industrials		—	$	6,927,635	$	52,525	$	6,980,160
Other Corporate Bonds & Notes		—		112,412,115		—		112,412,115
U.S. Government & Agency Obligations		—		8,438,745		—		8,438,745
Sovereign Bonds		—		5,602,120		—		5,602,120
Municipal Bonds		—		1,864,943		—		1,864,943
Preferred Stocks:
Financials	$	243,946		132,391		—		376,337

Total Long-Term Investments		243,946		135,377,949		52,525		135,674,420

Short-Term Investments†		—		502,094		—		502,094

Total Investments	$	243,946	$	135,880,043	$	52,525	$	136,176,514

Other Financial Instruments:
Futures Contracts	$	412,312		—		—	$	412,312

Total	$	656,258	$	135,880,043	$	52,525	$	136,588,826


LIABILITIES
DESCRIPTION	QUOTED PRICES (LEVEL 1)		OTHER SIGNIFICANT OBSERVABLE INPUTS (LEVEL 2)		SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3)		TOTAL
Other Financial Instruments:
Futures Contracts	$	115,515		—		—	$	115,515

†	See Schedule of Investments for additional detailed categorizations.

2. Transactions with affiliated companies

As defined by the 1940 Act, an affiliated company is one in which the Fund owns 5% or more of the outstanding voting securities, or a company which is under common ownership or control. The Fund may invest in Western Asset Government Cash Management Portfolio, LLC (“Cash Management Portfolio”), an affiliated private money market fund managed by , the Fund’s investment adviser. Cash Management Portfolio is available as a cash management vehicle for certain proprietary investment companies affiliated with Legg Mason. While Cash Management Portfolio is not a registered money market fund, it conducts all of its investment activities in accordance with the requirements of Rule 2a-7 under the 1940 Act. Based on the Fund’s relative ownership, the following companies were considered affiliated companies for all or some portion of the period ended September 30, 2018. The

Notes to Schedule of Investments (unaudited) (continued)

following transactions were effected in shares of such companies for the period ended September 30, 2018.


	Affiliate Value at December 31, 2017		Purchased				Sold
	Affiliate Value at December 31, 2017		Cost		Shares		Cost		Shares
Western Asset Government Cash Management Portfolio LLC	$	1,100,244	$	19,709,722		19,709,722	$	20,307,872		20,307,872


(cont’d)	Realized Gain (Loss)		Interest Income		Net Increase (Decrease) in Unrealized Appreciation (Depreciation)		Affiliate Value at September 30, 2018
Western Asset Government Cash Management Portfolio LLC		—	$	9,477		—	$	502,094

ITEM 2.

CONTROLS AND PROCEDURES.

(a)

The registrant’s principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a- 3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the disclosure controls and procedures required by Rule 30a-3(b) under the 1940 Act and 15d-15(b) under the Securities Exchange Act of 1934.

(b)

There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the registrant’s last fiscal quarter that have materially affected, or are likely to materially affect the registrant’s internal control over financial reporting.

ITEM 3.

EXHIBITS.

Certifications pursuant to Rule 30a-2(a) under the Investment Company Act of 1940, as amended, are attached 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.

Western Asset Investment Grade Income Fund Inc.


By		/s/ JANE TRUST
		Jane Trust
		Chief Executive Officer

Date:		November 26, 2018

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/ JANE TRUST
		Jane Trust
		Chief Executive Officer

Date:		November 26, 2018

By		/s/ RICHARD F. SENNETT
		Richard F. Sennett
		Principal Financial Officer

Date:		November 26, 2018