Nuveen Premium Income Municipal Fund Registers New Form of Preferred Securities

Action Designed to Sustain Benefits of Leverage and Help Fund Refinance ARPS

CHICAGO--(BUSINESS WIRE)--The Nuveen Premium Income Municipal Fund (NYSE: NPI) today announced it has filed a registration statement with the U.S. Securities and Exchange Commission, to issue Municipal Term Preferred Shares (MTP), a new form of closed-end fund preferred stock. This action is designed to help the fund preserve the benefits of leverage over time for common shareholders while also providing liquidity at par for current holders of the fund’s auction-rate preferred stock (ARPS, also known as MuniPreferred®).

The Nuveen Premium Income Municipal Fund is a leveraged closed-end fund that seeks current income exempt from regular federal income tax, consistent with the preservation of capital.

The fund intends to issue MTP to refinance all or a portion of its outstanding ARPS. MTP will have a mandatory redemption at the end of a stated term and will pay a fixed rate, tax-exempt dividend.

By issuing MTP, the fund seeks to take advantage of today’s historically low interest rate environment to lock-in an attractive tax-exempt cost of leverage for the term of the MTP. Issuing MTP could also help the fund mitigate the risk of a significant increase in its cost of leverage should short-term interest rates rise. These risks are heightened because NPI pays a taxable penalty rate on its existing ARPs so long as auctions continue to fail. The issuance of MTP by NPI is subject to market conditions, the receipt of ratings, and on final approval by NPI’s Board. There is no assurance the MTP will be issued.

Nuveen Investments provides high quality investment services designed to help secure the long-term goals of institutions and high net worth investors as well as the consultants and financial advisors who serve them. Nuveen Investments markets its growing range of specialized investment solutions under the high-quality brands of HydePark, NWQ, Nuveen, Santa Barbara, Symphony, Tradewinds and Winslow Capital. In total, the Company managed $119 billion of assets on December 31, 2008. For more information, please visit the Nuveen Investments website at www.nuveen.com.

FORWARD LOOKING STATEMENTS

Certain statements made in this release are forward-looking statements. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements due to numerous factors. These include, but are not limited to: obtaining final approval to issue MTP Shares by the fund’s Board; the effects of changes in market and economic conditions, including prevailing interest rates; the acceptance by the market, and demand for, MTP Shares in amounts sufficient for the fund to refinance all or a portion of its outstanding MuniPreferred® shares; the receipt of necessary ratings from rating agencies; the need to obtain any necessary regulatory approvals for the issuance of MTP Shares; other legal and regulatory developments; and other additional risks and uncertainties. Nuveen and the fund and its affiliates undertake no responsibility to update publicly or revise any forward-looking statements.

This press release and the information contained herein is not an offer to sell, or a solicitation of offers to purchase, securities. Securities may not be offered or sold unless registered pursuant to the U.S. Securities Act of 1933, as amended, or exempt from such registration requirement. Any public offering of securities to be made will be made by means of a registration statement that will contain detailed information about the issuer and its management, as well as financial statements. No money, securities or other consideration is being solicited by this press release or the information contained herein.