The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Melissa Wedel - JPMorgan Chase & Co. - Analyst
: Thanks for taking my questions today. First, wanted to clarify -- or just noticed the decline in portfolio yields, I think it was roughly, maybe 40 basis
points or so quarter over quarter with base rates being changed a little bit less than that. I was just wondering if there was maybe a little bit of drag
on yield from the timing of cash flows during the quarter and proceeds from the IPO? Or was that really a function of some spread narrowing during
the quarter?
Question: Melissa Wedel - JPMorgan Chase & Co. - Analyst
: Okay. That's very helpful. Thank you. And then, secondly, I was hoping that you could touch on, even though it's small, the non-accruals that you
announced post quarter end. I think your prepared comments referenced working with management through that situation. I guess, you guys
have had really low non-accruals since formation in `09.
Maybe going forward, is this indicative of sort of how you approach working through any sort of non-performing assets? It occurs to me that
because you guys have more exposure to more liquid investments that you could rotate out of any non-performing assets a little bit faster than
maybe some other BDCs could. How should we think about you guys managing through scenarios like that in the future? Thank you.
Question: Kenneth Lee - RBC Capital Markets - Analyst
: Hey, good afternoon. Thanks for taking my question. Just one on the new investments activity in the quarter. Saw some activity within the
collateralized securities structured products area. Wondering if you could just talk a little bit more about the relative value that you're seeing within
that category. Thanks.
Question: Kenneth Lee - RBC Capital Markets - Analyst
: Got you. Very helpful there. And just one follow-up, if I may? In terms of the broadly syndicated loan markets, thanks again for the color in the
prepared remarks, why don't you just share your thoughts around the relative attractiveness between the primary and secondary markets within
the BSLs right now? Thanks.
Question: Vilas Abraham - UBS Group AG - Analyst
: Hey, everybody. Thanks for the question. Just on spread, you touched on spreads getting a little bit tighter as we've been seeing and hearing. Can
you talk a little bit specifically though about kind of what the levels are now? And just put that into a little bit of context in terms of what you've
seen over the years. And just kind of how you think that plays out throughout this year.
Question: Vilas Abraham - UBS Group AG - Analyst
: Okay. And then going forward this year, would you say that just the volume of deal activity is probably the biggest driver here on which direction
spreads go?
Question: Vilas Abraham - UBS Group AG - Analyst
: Got it. Makes sense. And then just one more, just on leverage. Any latest thoughts there? It looks like you guys are comfortable in your range. But
anything new to do that and how you're thinking about that?
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