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Share Name Share Symbol Market Type Share ISIN Share Description
Nb Global Floating Rate Income Fund Limited LSE:NBLS London Ordinary Share GG00B3KX4Q34 RED ORD SHS NPV �
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.0% 81.50 81.50 82.30 0.00 01:00:00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Equity Investment Instruments 45.6 -98.5 0.0 - 1,047

NB Global Monthly Income Fund Ltd Portfolio Update - 30 June 2021

15/07/2021 7:00am

UK Regulatory (RNS & others)


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RNS Number : 2750F

NB Global Monthly Income Fund Ltd

15 July 2021

NOT FOR RELEASE, DISTRIBUTION OR PUBLICATION, DIRECTLY OR INDIRECTLY, TO U.S. PERSONS OR INTO OR IN THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN.

15(th) July 2021

NB Global Monthly Income Fund*

Monthly Commentary & Portfolio Update

30th June 2021

Key statistics

 
 NAV (GBP)                    GBP 0.9559 
---------------------------  ----------- 
 Current Portfolio Yield**         6.17% 
---------------------------  ----------- 
 Number of Investments               293 
---------------------------  ----------- 
 Number of Issuers                   205 
---------------------------  ----------- 
 

Asset allocation:

 
  Global High Yield:            32.26% 
  Global Floating Rate 
   Loans:                       40.80% 
 Total Traditional Credit:      73.06% 
-----------------------------  ------- 
 
  Private Debt:                 14.55% 
  CLO Mezzanine Debt:            8.58% 
  Special Situations:            3.82% 
 
 Total Alternative Credit:      26.94% 
-----------------------------  ------- 
 
 
 

Credit rating breakdown: as at 30th June (excluding cash), the portfolio was invested primarily in B (50.18%) and BBB/BB (15.92%) rated investments (1)

Market Update

Non-investment grade credit had another good month driven by better-than-expected earnings, strong economic activity and accommodative-yet-vigilant central bankers who more recently have focused on allaying investor concerns over higher inflation.

Senior floating rate loans ended the month of June in positive territory on improving issuer fundamentals, large positive retail inflows and strong new issue volume in CLOs. While the yield on the 10Y U.S. Treasury was rangebound in June and well off the recent peak, investors are still seeking attractive yield opportunities with durable income and lower interest rate risk as the debate about inflation being transitory is still undecided. U.S. senior floating rate loans, as measured by the S&P/LSTA Leveraged Loan Index (the "S&P LLI"), returned 0.37% in June with the lowest quality outperforming as BB, B and CCC returned 0.12%, 0.40% and 1.00%, respectively. The LL100, a measure of the largest, most liquid issuers, returned 0.12% which also underperformed the total S&P LLI. The European Leveraged Loan Index (the "ELLI") returned 0.27% in June, excluding currency effects. Year to date through June 30th, the S&P LLI returned 3.28% and the ELLI returned 2.96%, excluding currency effects. The Second Lien Loans index was up 1.24% in the month and 9.06% year to date.

The global high yield bond market rallied again in June finishing up a strong second quarter and while issuance was solid in the month it came off its record pace from earlier in the quarter. The ICE BofA Global High Yield Constrained Index finished the month, quarter and year-to-date period with returns of 0.93%, 2.62% and 3.42%, respectively. Dispersion of returns across rating tiers moderated somewhat as the second quarter progressed but the lowest quality and distressed issuers continued to rally. However, BB rated issuers also outperformed the index in the second quarter as the BB, B, CCC & lower rated categories of the ICE BofA Global High Yield Index returned 1.07%, 0.38%, and 1.81%, respectively.

CLO debt levels were stable in June, with the market continuing to demonstrate its ability to adequately digest the continued significant primary market activity. Fundamentally, the asset class has benefitted from the potential of higher near-term rates and strong underlying fundamental performance as well as continued attractive relative value vs. other fixed income assets. The CLO BB Index gained 0.42% over the month.

The pace of defaults and default expectations continued to decline materially in both U.S. and European non-investment grade credit markets, which is consistent with improving fundamentals. Non-investment grade credit, especially given its lower duration profile and attractive yields relative to other fixed income, will likely continue to see favourable investor demand, especially given that 65% of the global bond market still yields less than 1%.

Yield levels and spreads in non-investment grade credit are compensating investors for the increasingly benign default outlook. The economic recovery continues to play out and we would expect the improving trajectory of growth and pricing power to be supportive of issuer fundamentals. Continued progress on the rate of vaccinations, combined with consumer pent-up demand for travel, leisure and services, businesses rebuilding inventories and rehiring plus patient-but-vigilant central bankers should continue to support economic activity going forward. While new COVID variants and mixed views over inflation could result in pockets of short-term volatility, we believe our bottom-up, fundamental credit research focused on individual credit selection while seeking to avoid credit deterioration and putting only our "best ideas" into portfolios, position us well to take advantage of any volatility.

Portfolio Positioning

The overall Fund exposure to floating rate assets is at 66% leading to an average duration of 1.04yrs for the Fund. Floating Rate Loans remain the largest allocation at 40.8%, but as in recent months that allocation reduced in June as the team sold loans at or close to par seeing better opportunities for that capital in other buckets. In June, allocations to both CLO Debt Tranches and Special Situations increased whilst the Private Debt allocation remained static. Our current allocation to BBB/BB rated credits ended the month at 15.9% while our exposure to CCC and below rated names finished the month at 28.6% slightly down month on month. The new issue markets were again buoyant in June. Amongst others, the Fund invested in new issuance from Picard (a frozen food retailer based in France) and Comstock Resources.

Recent Investments

David Lloyd is an upper-tier gym operator in the UK with a well invested estate and large facilities in suburban locations. After a difficult period through Covid with gyms being completely shut during the UK's two lockdowns, the company is seeing very healthy demand for membership without the need for discounting in recent months driven by the more affluent sections of the UK consumer base with savings to spend and limited holiday options abroad. The company approached the European High Yield bond market in June with a Senior Secured 6yr GBP bond offering which priced at par with a 5.5% fixed coupon. Owner, TDR Capital, as part of this refinancing transaction, have injected new equity into the business. In a downside scenario (additional lockdowns) we view the starting leverage point and lack of near-term maturities as providing a sufficient margin of safety and so overall view the return on offer as attractive.

The fund also invested in a new senior secured loan issuance from Solera brought to market in June. The company is a leading provider of risk and asset management software and services to the automotive and property marketplace, including the property and casualty insurance industry. Serving over 280,000 customers across 90 countries an estimated 93% of revenues are recurring providing high degree of visibility into future top line trends. The fund purchased 1st lien term loans due 2028 with a 525bps margin above SONIA, a 0% floor and at a price of 99.

To access the June 2021 Factsheet, please click here http://www.rns-pdf.londonstockexchange.com/rns/2750F_1-2021-7-14.pdf

The Fund's website can be found at the following address: www.nbgmif.com

   1.   Source: Standard & Poor's 

* Effective 9 September 2020, the fund has changed its investment policy and name to NB Global Monthly Income

Fund Limited.    For more information, please refer to here. 

** The Fund's Current Portfolio Yield is a market-value weighted average of the current yields of the holdings in the portfolio, calculated as the coupon (base rate plus spread) divided by current price. The calculation does not take into account any fees, fund expenses or sales charges paid, which would reduce the results. The Current Yield for the Fund will fluctuate from month to month. The Current Yield should be regarded as an estimate of the Fund's rate of investment income, and it may not equal the realized distribution rate for each share class. You should consult the Fund's prospectus for additional information about the Fund's dividends and distributions policy. Past performance is no guarantee of future results.

-S-

For further information, please contact:

 
Neuberger Berman Europe Limited (Manager) 
 Elizabeth Papadopoulos                            +44 (0) 20 3214 9078 
Numis Securities Limited (Broker) 
 Hugh Jonathan 
 Matt Goss                                         +44 (0) 20 7260 1000 
Praxis Fund Services Limited (Company Secretary) 
 Matt Falla 
 Gemma Woods                                       +44 (0) 1481 737 600 
KL Communications (PR) 
 Charles Gorman 
 Will Sanderson                                    +44 (0) 20 7995 6673 
 

Background Information

The Company is a registered closed-ended investment company incorporated in Guernsey. It is managed by Neuberger Berman Europe Limited, which has delegated certain of its responsibilities and functions to the AIFM, Neuberger Berman Investment Advisers LLC, both of which are indirect wholly owned subsidiaries of Neuberger Berman Group LLC.

Neuberger Berman, founded in 1939, is a private, independent, employee-owned investment manager. The firm manages a range of strategies-including equity, fixed income, quantitative and multi-asset class, private equity, real estate and hedge funds-on behalf of institutions, advisors and individual investors globally. With offices in 25 countries, Neuberger Berman's diverse team has over 2,300 professionals.

For seven consecutive years, the company has been named first or second in Pensions & Investments Best Places to Work in Money Management survey (among those with 1,000 employees or more). In 2020, the PRI named Neuberger Berman a Leader, a designation awarded to fewer than 1% of investment firms for excellence in Environmental, Social and Governance (ESG) practices. The PRI also awarded Neuberger Berman an A+ in every eligible category for our approach to ESG integration across asset classes. The firm manages $402 billion in client assets as of March 31, 2021. For more information, please visit our website at www.nb.com .

RISK CONSIDERATIONS

Market Risk : The risk of a change in the value of a position as a result of underlying market factors, including among other things, the overall performance of companies and the market perception of the global economy.

Liquidity Risk: The risk that the Fund may be unable to sell an investment readily at its fair market value. In extreme market conditions this can affect the Fund's ability to meet redemption requests upon demand.

Credit Risk: The risk that bond issuers may fail to meet their interest repayments, or repay debt, resulting in temporary or permanent losses to the Fund.

   Interest Rate Risk:   The risk of interest rate movements affecting the value of fixed-rate bonds. 

Counterparty Risk: The risk that a counterparty will not fulfil its payment obligation for a trade, contract or other transaction, on the due date.

Counterparty Risk: The risk that a counterparty will not fulfil its payment obligation for a trade, contract or other transaction, on the due date.

Operational Risk: The risk of direct or indirect loss resulting from inadequate or failed processes, people and systems including those relating to the safekeeping of assets or from external events.

Derivatives Risk: The Fund is permitted to use certain types of financial derivative instruments ("FDI") (including certain complex instruments) which can give rise to particular risks, including market risk, liquidity risk and counterparty credit risk. This may increase the Fund's leverage significantly which may cause large variations in the value of your share.

Currency Risk: Investors who subscribe in a currency other than the base currency of the Fund are exposed to currency risk. Fluctuations in exchange rates may affect the return on investment.

The past performance shown is based on the share class to which this factsheet relates. If the currency of this share class is different from your local currency, then you should be aware that due to exchange rate fluctuations the performance shown may increase or decrease if converted into your local currency.

IMPORTANT INFORMATION

This document has been issued by NB Global Monthly Income Fund Limited (the "Company"), and should not be taken as an offer, invitation or inducement to engage in any investment activity and is solely for the purpose of providing information about the Company.

This document does not constitute or form part of, and should not be construed as, any offer for sale or subscription of, or solicitation of any offer to buy or subscribe for, any share in the Company or securities in any other entity, in any jurisdiction.

The Company is a closed-ended investment company incorporated and registered in Guernsey and is governed under the provisions of the Companies (Guernsey) Law, 2008 (as amended), and the Registered Collective Investment Scheme Rules 2008 issued by the Guernsey Financial Services Commission ("GFSC"). It is a non-cellular company limited by shares and has been declared by the GFSC to be a registered closed-ended collective investment scheme. The Company's shares are admitted to the Official List of the UK Listing Authority with a premium listing and are admitted to trading on the Premium Segment of the London Stock Exchange's Main Market for listed securities.

Neuberger Berman Europe Limited ("NBEL"), the Company's Manager, is authorised and regulated by the Financial Conduct Authority ("FCA") and is registered in England and Wales, at The Zig Zag Building, 70 Victoria Street, London, SW1E 6SQ and is also a Registered Investment Adviser with the Securities and Exchange Commission ("SEC") in the U.S. and regulated by the Dubai Financial Services Authority.

This document is addressed to professional clients only.

This document is presented solely for information purposes and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security.

We do not represent that this information, including any third party information, is complete and it should not be relied upon as such. Any views or opinions expressed may not reflect those of the Company or NBEL as a whole. All information is current as of the date of this material and is subject to change without notice. No part of this document may be reproduced in any manner without prior written permission of the Company and NBEL.

An investment in the Company involves risks, with the potential for above average risk, and is only suitable for people who are in a position to take such risks. No recommendation or advice is being given as to whether any investment or strategy is suitable for a particular investor. Each recipient of this document should make such investigations as it deems necessary to arrive at an independent evaluation of any investment, and should consult its own legal counsel and financial, actuarial, accounting, regulatory and tax advisers to evaluate any such investment. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. Investment in the Company should not constitute a substantial proportion of an investor's portfolio and may not be appropriate for all investors. Diversification and asset class allocation do not guarantee profit or protect against loss.

Past performance is not a reliable indicator of current or future results. The value of investments may go down as well as up and investors may not get back any of the amount invested. The performance data does not take account of the commissions and costs incurred on the issue and redemption of units.

The value of investments designated in another currency may rise and fall due to exchange rate fluctuations in respect of the relevant currencies. Adverse movements in currency exchange rates can result in a decrease in return and a loss of capital.

Tax treatment depends on the individual circumstances of each investor and may be subject to change, investors are therefore recommended to seek independent tax advice.

This document, and the information contained therein, is not for viewing, release, distribution or publication in or into the United States, Canada, Japan, South Africa or any other jurisdiction where applicable laws prohibit its release, distribution or publication, and will not be made available to any national, resident or citizen of the United States, Canada, Japan or South Africa.

The distribution of this document in other jurisdictions may be restricted by law and persons into whose possession this document comes must inform themselves about, and observe, any such restrictions. Any failure to comply with the restrictions may constitute a violation of the federal securities law of the United States and the laws of other jurisdictions.

The Company's shares have not been and will not be registered under the US Securities Act of 1933, as amended (the "Securities Act"), or with any securities regulatory authority of any state or other jurisdiction of the United States. The shares may not be offered, sold, resold, pledged, delivered, distributed or otherwise transferred, directly or indirectly, into or within the United States, or to, or for the account or benefit of, US persons (as defined in Regulation S under the Securities Act). No public offering of the shares is being made in the United States.

The Company has not been and will not be registered under the US Investment Company Act of 1940, as amended (the "Investment Company Act") and, as such, holders of the shares will not be entitled to the benefits of the Investment Company Act. No offer, sale, resale, pledge, delivery, distribution or transfer of the shares may be made except under circumstances that will not result in the Company being required to register as an investment company under the Investment Company Act. In addition, the shares are subject to restrictions on transferability and resale in certain jurisdictions and may not be transferred or resold except as permitted under applicable securities laws and regulations. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdictions.

The "Neuberger Berman" name and logo are registered service marks of Neuberger Berman Group LLC.

(c) 2021 Neuberger Berman Group LLC. All rights reserved.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.

END

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