Western Asset Municipal Partners Fund : Annual Report

Annual Report November 30, 2021

WESTERN ASSET MUNICIPAL PARTNERS FUND INC. (MNP)

INVESTMENT PRODUCTS: NOT FDIC INSURED • NO BANK GUARANTEE • MAY LOSE VALUE

Fund objectives

The Fund's primary investment objective is to seek a high level of current income which is exempt from regular federal income taxes*, consistent with the preservation of capital. As a secondary investment objective, the Fund intends to enhance portfolio value by purchasing tax-exempt securities that, in the opinion of the investment manager, may appreciate in value relative to other similar obligations in the marketplace.

Under normal market conditions, the Fund invests substantially all of its assets in a diversified portfolio of tax-exempt securities that are rated investment grade at the time of purchase by at least one rating agency or, if unrated, determined to be of comparable credit quality by the subadviser, and that the subadviser believes do not involve undue risk to income or principal.

What's inside

Letter from the chairman	III
Fund overview	1
Fund at a glance	6
Fund performance	7
Schedule of investments	9
Statement of assets and liabilities	28
Statement of operations	29
Statements of changes in net assets	30
Statement of cash flows	31
Financial highlights	32
Notes to financial statements	34
Report of independent registered public accounting firm	47
Additional information	48
Annual chief executive officer and principal financial officer certifications	54
Other shareholder communications regarding accounting matters	55
Summary of information regarding the Fund	56
Dividend reinvestment plan	70
Important tax information	72

• Certain investors may be subject to the federal alternative minimum tax ("AMT"), and state and local taxes will apply. Capital gains, if any, are fully taxable. Please consult your personal tax or legal adviser.

1. Western Asset Municipal Partners Fund Inc.

Letter from the chairman

Dear Shareholder,

We are pleased to provide the annual report of Western Asset Municipal Partners Fund Inc. for the twelve-month reporting period ended November 30, 2021. Please read on for a detailed look at prevailing economic and market conditions during the Fund's reporting period and to learn how those conditions have affected Fund performance.

As always, we remain committed to providing you with excellent service and a full spectrum of investment choices. We also remain committed to supplementing the support you receive from your financial advisor. One way we accomplish this is through our website, www.franklintempleton.com. Here you can gain immediate access to market and investment information, including:

• Fund prices and performance,
• Market insights and commentaries from our portfolio managers, and
• A host of educational resources.

We look forward to helping you meet your financial goals.

Sincerely,

Jane Trust, CFA

Chairman, President and Chief Executive Officer

December 31, 2021

Western Asset Municipal Partners Fund Inc.

III

(This page intentionally left blank.)

Fund overview

Q. What is the Fund's investment strategy?

A. The Fund's primary investment objective is to seek a high level of current income which is exempt from regular federal income taxes, consistent with the preservation of capital. As a secondary investment objective, the Fund intends to enhance portfolio value by purchasing tax-exempt securities that, in the opinion of the Fund's investment manager, may appreciate in value relative to other similar obligations in the marketplace. Under normal market conditions, the Fund pursues its objectives by investing substantially all of its assets in a diversified portfolio of tax-exempt securities. As a matter of fundamental policy which cannot be changed without shareholder approval, under normal market conditions at least 80% of the Fund's net assets will be invested in tax-exempt securities. The Fund invests primarily in tax-exempt securities that are rated "investment grade" at the time of purchase by at least one rating agency and that the subadviser believes do not involve undue risk to income or principal or, if unrated, determined to be of comparable credit quality by the subadviser, but the Fund may invest up to 20% of its net assets in securities rated below "investment grade" (commonly known as "high yield" or "junk" bonds) at the time of purchase. The Fund may use a variety of derivative instruments as part of its investment strategy, or for hedging or risk management purposes.

At Western Asset Management Company, LLC ("Western Asset"), the Fund's subadviser, we utilize a fixed income team approach, with decisions derived from interaction among various investment management sector specialists. The sector teams are comprised of Western Asset's senior portfolio management personnel, research analysts and an in-house economist. Under this team approach, management of client fixed income portfolios will reflect a consensus of interdisciplinary views within the Western Asset organization. The individuals responsible for development of investment strategy, day-to-day portfolio management, oversight and coordination of the Fund are S. Kenneth Leech, Robert E. Amodeo and David T. Fare.

Q. What were the overall market conditions during the Fund's reporting period?

A. Fixed income markets experienced periods of volatility and, overall, declined over the twelve-month reporting period ended November 30, 2021. Volatility was driven by a number of factors, including the repercussions from the COVID-19 pandemic and several virus variants, sharply falling and then rising global growth, inflation concerns, and shifting Federal Reserve Board (the "Fed") monetary policy. Most spread sectors (non-Treasuries) outperformed similar duration Treasuries. This was driven by the rollout of several COVID-19 vaccines and relatively low interest rates, which triggered increased investor risk appetite as they looked to generate incremental yield.

Short-term U.S. Treasury yields moved sharply higher as economic conditions improved. The yield for the two-year Treasury note began the reporting period at 0.16% and ended the period at 0.52%. The low of 0.09% occurred on February 5, 2021, and the high of 0.63% took place on November 22, 2021. Long-term U.S. Treasury yields also moved higher, as positive economic data triggered inflationary concerns and the Fed began removing its

Western Asset Municipal Partners Fund Inc. 2021 Annual Report

1