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Golub Capital BDC (GBDC)

Participants
David Golub Chief Executive Officer
Ross Teune Chief Financial Officer
Gregory Robbins Senior Managing Director
Jon Simmons Managing Director
Robert Dodd Raymond James
Finian O’Shea Wells Fargo Securities
Ryan Lynch KBW
David Miyazaki Confluence Investment Management
Call transcript
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Operator

Welcome to GBDC’s December 31, 2020 Quarterly Earnings Conference Call.

Before we begin, I would like to take a moment to remind our listeners that remarks made during this call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts made during this call may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time-to-time in GBDC’s filings with the SEC.

For materials, the company intends to refer to on today’s earnings conference call, please visit the Investor Resources tab on the homepage of the company’s website, www.golubcapitalbdc.com and click on the Events/Presentations link. also section. the is the website release Resources Investor earnings available company’s on in GBDC’s

reminder, call over a BDC. will Chief As this Officer now purposes. for Executive turn I replay the Golub call of to Golub, is David Capital being recorded

David Golub

hope you. team Managing for good issued us Director; Golub earnings Simmons, quarter Capital Director joined and the on and today. XXXX Financial Officer; Capital. thanks our at the a press Ross we Jon your the our Golub off to and presentation Teune, Chief that start. is everybody for rest an XX, Yesterday, our We Gregory earnings ended Hello I’m Thank website. joining posted by Robbins, of we December and Senior Managing release

referring this the call be will throughout to today. presentation We

middle-market new senior of since and on it strategy those who For loans equity by you sponsors. secured GBDC, to that providing our investment to is to resilient strong partnership-oriented has companies focus first-lien are private been, backed inception are healthy,

Let by giving that income the quarter solid and and estimates with XX GBDC’s in credit filed start is we investment January XX. were performance. for for on performance the headline that quarter that they December were headline ended results preliminary the line GBDC’s net strong the and me exhibited continued strong

the and a some the a and post-COVID a and start XX/XX providing of more the drivers off questions. he we the Jon Ross through that, line the go those then at then for going results. we by of Gregory key overview quarter performance take provide closing reviewing in going commentary our open Gregory? review performance as look these results let’s hand detail is more results. for With GBDC’s will topics will closer I will detailed then to both for it and We discuss today’s presentation. of to quarter is to for brief GBDC’s

Gregory Robbins

I am David. Slide on you, going X. Thank begin to

besides right-hand to the $X.XX to continued share COVID; just were private perform adjusted XX, that portfolio ended an support the well, was the NII EPS those repeating adjusted the gains. X namely for these declining of results? which non-accruals; quarters, unrealized quarters. Slide the up credit we was by These of were key and ending trends listed quarter What prior same improved the themes drivers, continued second, impacted low At reflected and per risk of are losses; discussed underwriting, remained slide, published summarized within solid portfolio drivers have are on December to key last and step companies. trends net share ourselves, our their continue per For good the generally are: have internal sponsors the of performance previously. side companies positive realized we two all generally in GBDC’s NAV in ranges ratings; four net the the was $X.XX, And trends, economy despite first, equity $XX.XX, like on

the these X period. COVID during in of our first each trends, Slide a internal at take Let’s starting performance portfolio the positive performance look internal ratings. summarizes GBDC’s of closer with ratings the trends

expectations because also important X A decrease X to in improvement from expected the our expectations and declined since X same in investments meaningfully to than significant portfolio X underwriting; in X.X% better XX% is usual percentage remains of to are share still we period. from fact X saw of materially performing or categories a below performing key idiosyncratic. X.X% gains. continued portfolio from value improving and as The that unrealized as also rare credit XX, X of X over X what that as from of decreased second per XX.X% This results. XX/XX. rated increased to perform NAV X.X% back X two quarter-over-quarter bridge a in the non-accruals quality: also increase credit our decreased declining indicates are of declined The GBDC’s and than below of this of higher of expectations. provides a X/XX categories increased the come of from XX.X% quarter it $XX.XX in that portfolio Specifically, of proportion seen portfolio the XX, loans ended and point discussion the to Slide low other The GBDC’s March Category solid net Category NAV steady shows of steadily. categories at XX.X% $XX.XX very to and pre-COVID, and share December quarter-over-quarter per portfolio as loans credit X as or the X, but slide have proportion categories the has those financial We’ll and performing at typically at In rated from to impairment X net losses is X/XX the XX/XX. its at indicator improved of percentage X, Categories a and is small the we X/XX. X.X%. fair X of our indicators and XX/XX. key realized

bridge. Let’s walk through the

a with how share. remarks in our today. the unrealized That XXXX dividend; challenges unrealized realized will of of incurred be the per quarter. at the COVID? fair losses see, net low part remain NII GBDC $X.XX of line in David’s losses were closing share; These question, can these a navigating step continued quarterly $X.XX, gains unrealized per was in March question indicators credit per subject strong Taking adjusted you net the $X.XX reversal and did reflect of share gains of answer back, performance broader As

ended look our quarter at XX. closer a take for results now Let’s the December

hand let the Simmons results Jon detail. walk that, over Jon? through to the For me call to more in you

Jon Simmons

Thanks, Gregory.

we gain two realized quarters. for net This was of each adjusted $X.XX. realized of compares XXXX GCIC provided measures This gain recorded are we addition earnings the investor share and compares Appendix $X.XX in today’s quarter. net credit adjusted per in note of and certain at measures, last unrealized Slide Adjusted as the $X.XX measures. described earnings unrealized merger With from losses” up GAAP reversal seek the out context, “adjusted” share results the look income throughout share per the to the we before losses refer of per of call. non-GAAP turn earnings $X.XX. realized to continued and by quarter per the is or, strip for the adjusted investment gain March write-off the unrealized quarter to or refer presentation quarter. September XX was purchase for in further share December These that measures non-GAAP also prior quarter to for “income reminder, net the amortization. and our that the more premium and the These we was to driven Adjusted a GBDC’s this in to the of The them per This XX to quarter per adjusted ended to net for as share the let’s them, First, have financial please in unrealized primarily as NII impact detail. Adjusted in $X.XX. it, of quarter, December was share call $X.XX. we’ll adjusted presentation, earned

December per asset share XX, $XX.XX net value to increased of as Our XXXX September from at $XX.XX XX.

net XXXX. March X, Board in asset basis. of X, to Ross to of annualized XXXX having With February record detail. a hand Ross? of on quarterly over consistent the share, our value results quarterly distribution of X% stockholders per quarterly call XXXX, Finally, go the on approximate I on more as cash $X.XX is will goal that, through with payable distributions This our declared an of March to XX, distribution

Ross Teune

Jon. Thanks, Great.

ended ended Turning for were to and quarter investments portfolio the and XX, fair well factoring $XXX.X investment record as total XX. of After million exits XX, million. value X.X% during other quarter $XXX in activity, commitments million depreciation investments by a or total December of totaling as December at sales Slide unrealized increased new $XXX.X the

December small context commitments These $XX.X position. XX, commitments of of undrawn on the undrawn $XXX.X sheet commitments million of of relatively liquidity our balance As unfunded revolver delayed million loans. term and we are in had and draw

weighted over to prior LIBOR spread the in the of rate of of rate from on and the average of quarter shown As continued COVID. the X.X% onset the X.X% table, average new investments market decreased on bottom conditions since rebound weighted floating new the investments both as

on the time reminder, interest funding. a based on as weighted rate at contractual the interest investments new rate the average Just of is

portfolio by our LIBOR of LIBOR, The less consistent floor. variable investment using than loans, of our type shows our the would with bottom Slide an the contractual portfolio loans rate For at the remained of obligor points. the spread highly calculated average impact slide be of top The mix any shows one-stop XX%. category current XX diversified has that largest by quarter-over-quarter investment represent over that with LIBOR, continuing to size investment and remained rate basis XX overall

industries XX, XX% believe in be investment COVID-XX. loans what and insulated that positioned our portfolio Turning senior we defensively in resilient lien, first of to Slide to secured rate remained floating are from

spreads this Turning investment yields summarizes quarter. to graph portfolio the XX, net Slide and for

origination line, basis repayments. discounts, fee for by investment unsecured bond increased on impact this or of or to on $XXX amortization income in the quarter, XX represents earned X.X% the at first and dark the amount fees due points, to X.X%. that XX. line, of weighted blue of income the the yield, cost December interest ended the to the including price caused of stable average the upfront the increased excluding amortization blue the income line, The fees debt, points quarter and aqua increased slightly portfolio blue income, includes premium. by yield purchase our to during rate due and the yield, amortization fixed line actual by offering fee Focusing basis light the investment, XX million X.X% early which Primarily closed the quarter remained The

remained debt significant investment two as cost decreased and next and weighted difference line, X%, and X.X% XX last fair by the non-accrual Flipping Our the a and remains basis LIBOR. to but of X value the investment to spread, in the December income of or net years points close in XX. cost drop green between debt, average low X.X%, to total highest the is yield at slides, despite percentage to as level respectively, which decreased the its the of investments investments

company During the number two investments portfolio portfolio accrual seven investments portfolio company of nine status. as returned from investments, company to investments non-accrual quarter, the to decreased

value fair result commentary, to XX. As portfolio of our rated portfolio X investments of his as percentage internal XX.X% December stronger discussed the scale of opening Gregory of as the performance, in at decreased on rating a company performance

As a ended statement and reminder, least XX for independent valuation at and the three of investments months further XX of each December on our our Slides balance details quarter. and XX% income firms value provide XX. sheet as

Turning regular bottom summarizes distributions to on returns five the at Slide over top on years, frame. XX, time special graph and the well distributions the summarizes over the as past same the our our graph quarterly equity our as the quarterly

X.XXX%. through of we January other the the shareholder the XX, Turning revolving $XX.X this million XXXX, optimizing things, an to other IPO. and capital facility included, included, credit graph long focus quarter, strong and a the balance borrowing A-X from XX that debt in to highlights the XX, investment December Class right-hand of of continued with XX, extension summarizes on rate million period which XX, capacity summarizes our returns since of of our XX Stanley to April among XX the December a Slide amended the of on reflects our debt Debt recent reinvestment Slide among our we the also decrease million. maximum the side from which as end terms illustrates sheet. reduction Slide our GCIC liquidity our of $XXX $XXX on financing interest After Notes On capacity amended Securitization, and X.XXX% XXXX amendments. in as history our the December things, XX of Morgan

X. Lastly, distributions our March March Most a to declared closing Board remarks. distribution I recently, some turn XX summarizes $X.XX With David stockholders. back Slide share payable to of of will David? our that, of XX stockholders for per record to it on recent as

David Golub

Ross. Thanks,

investment enough Having Slide not back key XX, and us third, on market said for of how performed. attractive balance substantial, On three to match a when data portfolio; opportunities. goals up, I credit to yet. to goals. these “Post-COVID low management nine think going second, continuing begin rose in over quarter. at this, sum we’ve had to still the now to to COVID—but look have start improve, we prepared XXXX of to strong early were post-COVID remarks good has we and sheet; very unrealized unrealized end the So what in what March probably learned that GBDC’s Adjusted of we a I navigating as proactive call recognize I assess established GBDC’s of it’s investment losses now capitalizing reversal and realized Hindsight.” a it’s I our of income we and first, want key new were three COVID: against back I from outlined on that for think conditions time period losses investment quarter. We months with we happened net is gains performed incurred March our COVID dividend, optimization reflect how the GBDC bit am to on

a look. Let’s take closer

goal, first COVID. consequence calendar as a was of we marking proactively to diversified investment losses the secured significant fair in unrealized portfolio industry bred our of lien, dislocation value I as highly market key had, our XXXX, of manage from first whole had, QX to portfolio. senior mentioned, GBDC’s Our In fact

said losses to said we credit a consistently on over realized that then And that expect laser-focused see since becoming of time reverse we or unrealized have permanent those succeeded. we’d we be those We preventing lot losses if unrealized losses. consistently from

so but early encouraging. how far a So, Too the give we doing? definitive are quite is to data answer,

but horizon. longer-term at with key credit a back Let’s metrics, our look four

in performance rating to internal to rating companies a seen perform ratings X. the we in Since migration have corresponding X portfolio because These improved, Those Gregory as categories GBDC’s below have Category expectations loans categories well. XX, XX.X% generally XX/XX. his have Category discussed from continued risk ratings. First, portfolio are at there to loans better XX.X% remarks, and as the and loans March are meaningful ratings the of to have performing X or of portfolio perform bit as at expectations. have than X. expected X they to loans from performing migrated or origination Category a X/XX of declined upward of

bit it’s XX%. to is our relative around closer levels, to trend that elevated So, XX.X% still pre-COVID much long-term but a of

impairment, stayed declined we’ve fact, in Importantly, proportion X% X the very throughout loans the number. X% are low. stayed to really X, relatively problematic that and rated overall risk those few period, this COVID-impacted They are had of portfolio material about means of have borrowers. in and at This they

Second, our of non-accruals XX/XX. portfolio of value are back to X.X% low the at pre-COVID levels, about as fair

Third, fourth were cost the and is to of number that had bulk COVID significantly. reversed has realized losses losses with realized this points XX low. two, those COVID on to have investments losses have since attributable finally, basis losses remained unrealized companies began. began, GBDC total, its at being underperforming about before unrelated And of not In and

a portfolio underwriting company consequence strong In our These quarter as was fact, portfolio four about our has key that the working. strategy from value that management very been fair of performance. of XXXX recovered March suggests the metrics we’ve and markdowns proactive XX% solid

COVID, to move key on one? Let’s How I’d second that make the sheet. goal three navigating key we are the optimizing points. for balance doing

use capital. in period ratings. flexible the CLO issued and of received investment debt bank its facilities. March First, GBDC reduced new secured since XX, and a It’s issued low-cost attractively has priced It’s unsecured grade its

target leverage borrowing And with at liquidity of Second, range cash GAAP million $XXX is than capacity. abundant right X:X leverage within our third, is finally, debt-to-equity. over less slightly and

record what over we opportunities. new I new position period XX/XX GBDC originations did How would third quarter a for million do speaks the key investment anticipated capitalize in there? setting our to unusually $XXX itself. of think on of we to Finally, our attractive be goal,

perfect—our sum never encouraging. up right far and good goals. credit, So, particularly to those hindsight, our been set It’s against we made be so out signs work the early too haven’t we’ve are goals we is post-COVID on to the we progress think and over—but definitive, that

what next. me about talk Let comes

our for you. is three on backing line going private Our companies relationship-oriented of stick advantages. strategy same to firms, competitive Thank resilient industries proven focus to questions? equity key very the could open you Operator, in XXXX sponsored familiar: by these goals, and lean calendar for please game plan sound resilient year on our

Operator

Robert And the question [Operator your from of Raymond Thank you. Instructions] line first Dodd from James. comes

Your line is open.

Robert Dodd

Hi, guys.

mean you ago. year spreads on First, the David, your I on give color wider to on, hindsight, market now spreads the have and point, to than like your kind new point. a any deployment of they Can certainly were you post-COVID COVID a held were – seems moved from us

fourth some can you on And pre-COVID. So, there I at mean, as on true give still widening can compressed? on, seems terms January? Are be be us any the you any to into mean that versus still color spread appreciated. is the would quarter go holding seems spreads that in least have up? And to calendar we market us color I give front

David Golub

to Sure. Good Robert. hear voice. your Hello,

Calendar put QX sense a Golub unusual quarter was was M&A market-wide. in me Capital, let So, an context. a in record activity it surge in the there that quarter for

So, a were we it large actually our with we proven of calendar who most better. of XX% it calendar worked I repeat are with have good focus spreads Leverage able post-COVID of with wasn’t for were times. performance. was calendar were that originations in than on believe the originations you Documentation QX looked to bit was say multiple open bit debt terms in QX Over if at Capital, had The a were were we that quarter a our And said, Robert, saw sponsors strong just bulk for a for over the Golub add-ons. importantly, origination as better managers would companies of better. bit QX QX, activity sponsors. I business. quite XX% pre-COVID. was private quarter origination you a

sponsors know know able were very we on very with we that we well. to focus that well So, credits

I able makes we information. lots think to of opportunities, that for because are attractive make decisions investment with

year in seasonality business. seeing than we we general first first moved a QX XX/XX, sponsor-financed year. the quarter tend are slower calendar quarters typical into I in And think the There this XXXX, As of to be in that’s crossed that quarters. is bit

were that seeing alluding and And compression Robert. also spread broadly of that, competitiveness is think are a We market. burst to the in syndicated you there I

tightening seen loans have lot during flexes, being syndication the We of spread a are syndicated that the lot that on of of in form process.

expectation is So, middle-market what and of over is by to and happens the relationship. months, in broadly the are course markets unless spreads going syndicated high-yield But in on Usually, in my is broadly the syndicated that in market. and impacted one-for-one not a there we it’s market. that market in a the there is my expectation private the a pressure change dynamics the is see happening what’s the coming lag

attractive. to it now, For continues be

solid I as in We to kinds of now are broadly QX private right think see right origination syndicated patterns going I – market. pipeline same now it’s anticipate characterize we but reasonable would the market that standpoint, seeing we are from that a an to quarter good are in the the

Robert Dodd

I it not triple sticks was is If where can mean that related PIK a quality out good. that year to mean, appreciate a be of market, only The Obviously, book next it thing I I looks pretty overall looks ago. lot. to mean, it’s the credit income. kind me I I question, improving. well, to

You third PIK you from – up portfolio mean PIK in bit or horribly little amendments the tick concerning, calendar up are generally fourth not or single the quarter that But bit stands anything it’s else I was meaningfully not below number. income, have I that there big seen. little is did still out a a fourth the the overly leaps high is the industry to asset fairly grew a that like calendar a quarter. thing PIK Nothing out there. only it that. but there It’s quarter. a low bit. no The even in average in the from Again, run last something so trend very that

David Golub

are at where relatively two think late-stage put industry PIK To I in the areas it think is to we by that relates income right. have some. increased you it’s And seen in context, Golub I our grown, Capital has standards. one lending. activities small It

the loans number way So, have last as business, to software-as-a-service this cases, compensate that grown in years. And LSL prefer of has the where some is over with in the they, a companies portfolio our are portion PIK of us. which in they of

The credit is on that a to, is COVID. negotiations point facilities to through in amendments you second existing which alluded

incremental have of We mix some the form amendments. different PIK the of in interest part in circumstances as used of components of

associated And continuing so is going trend. in increase think with be don’t income some PIK there I a is that. to this

to stabilize think I down to that I concerned go quarters. repetition I And have afraid point. PIK going that income associated seen don’t PIK are are terribly suspect at are you what of in of our think not I pattern you this which perhaps coming BDCs with am see other see and even a with going income where risk we been has credit never is about a accruals you PIK received.

Robert Dodd

about Thanks. Thanks congrats pretty about, on I quarter. the and appreciate Yes, I the transparent I answer. a was really lot but what asking am

Operator

from question next O’Shea Finian line Fargo your the of comes And Wells from Securities.

Your open. line is

Finian O’Shea

question, Hi, underperforming this are additional and first on economy provide and David, EBITDA of perhaps, category the opens although color COVID or or the can good the the any on up end at profitability appreciate levels everyone. the improving slowly impacted names, so as you afternoon commentary well generally, forth? how recovers

David Golub

the in categories we about. concerned candid over are March last of in the been the industry quarters being as we the So we industry the have we XX quarter how mentioned several performance of about course with have pleased been the most that very companies categories

gone some we retail, EBITDA marks. fair look back we about mean, So, proxy fair continue that about vaccination carefully, think I care, a value the going if would to value industry the And general recovery the timeframe, don’t I say obvious, fair monitor I which diversified franchises. a has if of disclose dental in EBITDA of amongst averaging and is I way At different care sectors there value marks concerns one risk the have you in stating one is April from And franchises. the we fair performance, in while a also performance averaging to been XXs. marks the view fitness restaurants, a slowly, campaign that fitness for dozen typical really a recall, has it’s to going be industry with to is is high continue in you COVID The companies. is Good marks slow. those It’s the XXs franchises going to talked eye those small that the news sector now fitness high sectors, for value the portfolio. here at us of half in portion the

cautiously comfortable the – into about that We’re will feel of industries don’t going I fast well really alarmist. gyms. back COVID-impacted optimistic when recover I and our we high-value identified mean fitness people focused exposure. recovered quite COVID on well. early to recover others I’m But those industries low-cost, the – think segment, have which sound franchise

Finian O’Shea

you in on there’s unitranche, time, focused with you. But quarter, a you’ve just long into then follow second and for so added lien obviously, mainly any have activity origination some helpful. sounds at of that forth? and least financings drift number now And style, the unsecured. this it the other lien, Do element on for any right example. whether style shift side on And That’s on, a like grow. risk, first balance it Thank been we the anticipate be sheet, will of

David Golub

no. answer, Short

not strategy. meaningful in are any change We anticipating

to GBDC finance the with their within And a to continue the right in sponsor unlikely is achieve number focus to depending ways, shift what’s much. is our which Our different I focus deal. is a sponsors on anticipate best to mission, strong finance for to that enabling on be businesses of mix

in If of if of about really about about back that’s hasn’t in at you quarters. again, really diversification and it the proportion that go many, we granularity many portfolio quarter portfolio, moved present charts statistics the quarters. look look the is every it degree and one-stops many currently moved in in And the much the many, hasn’t you XX%, at

I’d to core those our are, of elements say, change. So, strategy unlikely

Finian O’Shea

And helpful. That’s thank That’s well. Very you. for all me.

Operator

comes Your of next Lynch the from from Ryan line question KBW.

Your open. line is

Ryan Lynch

around portfolio as for your thanks of your taking reflections has how on and David, this you commentary you performed afternoon period reflect during of questions. kind my kind some COVID Good provided back.

questions changes hear had broader funding it’s One returning, pre-COVID feels of changes lending little It or direct you returned industry of whether than lasting or to out are industry structures any on not the a it’s is my bit question come term could the But to think lasting potential the Do question. your see love direct post-COVID? of players like – yields direct any where players, levels. of if effects lasting a I quickly are how kind and post-COVID, whether themselves commentary kind companies or already lending was larger that. on where lenders I’d invest? you

David Golub

now we see the have saw has a of largest to saw we at be been one recently. I’m the great been debt Ryan, that we’re private the growing. began. than We’ll pace think COVID, got bigger. The before COVID I I’ve about that And big growing if honest, during been and to industry a that which my hypotheses faster trend, is players right out going right, but it’s of see a continuation is COVID, of of question, one a lot a thinking coming trend

may that I So last why an do acceleration goes of contributed I made quarter. to COVID some to have think comments this back trend? It

of If firms in-person have challenges reason that managing the on they of Zoom, reduce challenges private about credit relationships be to over you leading new focus more than number partners. meetings, I private that on. industries, are the relationships to equity multiple to going see think are important it industry. sized equity relationships seeing companies to that the larger without same equity establishing strategically they stands private inclined will phenomenon degree think of lines, multiple and equity multiple are growing. is we’re trend, we that And the of they working further product developing complexes quickly growing are The in exacerbate multiple private a more What the that

think number different customer of solutions. work you private want a you if managers going pool, in about who, are large-scale where So the private smaller to variety larger the of comprising to offer debt of future biggest with direction a smaller a equity turn, going they’re the to can number have companies of industry,

headed. are So, I we that’s think where

think that’s Golub I good for Capital.

a because industry I think it’s solutions your industry, make with are and, outlier the and don’t to players will earlier, sense. lead fewer more probably who offering for terms any messing up it out to that stable, also or point good in smarter

Ryan Lynch

Got scale trends sense. certainly, might Golub persist, makes those But it. that that easy platform just March. million but then Stanley $XX by today, I broader the be an it if cash, on Yes, $XX on guys certainly million that’s beneficiary facility, on and big on really This million, would Morgan your liquidity ends sheet balance look reinvestment to that, be at facility, downsized and nothing $XX your a your given one. if your relationships. that would And reach right million Wells now, available but of been unrestricted in $XX have about period you so and in

your $XXX the as million growth guys so, funded? next be you of million the I I to $XXX your wanted and would at quarter, cash get where well look thoughts balance sheet, growth as And of structure on had this the liability as your on, capacity available

David Golub

Sure.

this. two good So, Two on questions. comments

in amount you the we if consequence payoffs. CLOs year distorted of cash a the is somewhat look year-end year-end or at First, because very as almost of have a large picture end, restricted

the the more cash using right and now. our important post in facilities which go forward. moved in do do an one, number restricted liquidity year-end, securitizations into to your with from a ample period assets want up So, were going of imagine said things the is so intention question sheet bank where significant is have that Having that, lines, balance bank creating is very here? And availability from two to we we

mix we that one corporate facilities. a And with is manage corporate first a bank trying the bank we of plan to in are facilities to things right have The existing revolver dealing pursue is and the between revolver. new bilateral the to

the more So, have period I information in coming discussions with will share you as expect those continue. to we

year. sheet. being by asked market the time but of the an it it is our I clear grow execution of at from issuance of unsecured the structure to add component I course that going last a structure. – rush want any at accessing I or first anticipate a as piece our are percentage that the mix of unsecured issuance, who we’re the opportune We this did can’t remember, to second standpoint. is we think balance our anticipate was we was a this unsecured were what’s to of we north whether we very do within anticipate liability And When stretch. want serial to time that. unsecured we’re we a that issuer. not in do answer our And something sure We The that you you But the want Ryan, ideal don’t being XX%. over component saying Again, to to my in was liability make

Ryan Lynch

Okay. that have your March from portfolio losses XX% really on quarter gave has good your one performed of unrealized That’s reversed. mentioned XXXX and some how well. the really it’s you commentary really of But the performed helpful. you then COVID, through And was statistics

So that means reversed out are still have there. XX% not

investors of think encourage March to that but losses about So, that I XXXX that from reversed to think unrealized not remaining couple quarter? have how different there’s XX% that, you about ways a think would of

David Golub

right? significant increase calendar XXXX it’s think in with QX unrealized connection QX QX, and income I of the course losses. net have reversals over We of a of in seen Well, opportunity,

quarter, would you it March how X after me ask will told have probably would we occur If expect reversals, years. the over over to many to quarters I you see

three In quarters. of it fact, XX% occurred in

we’ve that to reversal those off, – go may So, marks which faster par, it to discount loans up going It’s a sooner reversal will discount all that pay that see anticipated. reverse, one got we we than a And value par, assume of XX/XX. see to would necessarily loans is that fair to marked by have that our are off. have it’s when I would should reverse all of at to don’t think a been back not would big it anticipated I – reasonable a than pay some that if will par.

draw think don’t we’ve I that So, conclusion has that the there’s to not yet fact negative from a got XX% reversed.

lot I of don’t good change. things we that’s have were a proportion Performance and X a think Look, by in impaired We I certainly a portfolio We the in wasn’t the surprised really March now. is indicator get very small can pandemic. that portfolio Ratings COVID. fact global surprised. that we’ve seriously can last only got right X a the expecting

I’m risk there So here. not isn’t arguing

portfolio about business right I a in feel good of risk, the are but is We managing where now. pretty

Ryan Lynch

Great. time. Those afternoon. have I my all the questions are that really this Certainly. appreciate I

Operator

of And Miyazaki next Investment. your from line from question David Confluence comes the

line Your open. is

David Miyazaki

questions. my you Hi. Hello, thank for taking

credits, this of remembering driver – premium part lined recognition specifically Just that of GCIC. straight the little or around get to forgive this regarding some over of the trying principal this how in to of Is dissipates arms allocated time? just and a you have my manner the for of knowing not or and bit a to it is or, me question kind not quickly but individual properly, that’s amortization

David Golub

you strongly credits from Simmons it Jon repaid. this encourage So, as about specific are because would it those Ross And so and as and credits GCIC, acquired the to I resident it will speak hurry. complicated experts, is dissipate gets that in our GBDC Teune, a to attached to credits

David Miyazaki

at Are kind manager? strategic distantly of are of combination? can happening on you little longer-term a GCIC-like you plans bit taking might up I other that that related talk In okay. place? be for there take more manner, other the external a GCIC-like some are the What Is activities you Okay, that. concepts funds? about will raising other

David Golub

BDC ramping And when of will So information are variety GCIC. as up. have different of private publicly did BDC GBDC we called process we for creatively options we in X, we look a for this, the which at that’s on very Capital available Golub X, a it is ramped,

one a can and figure to options potential go go no One and of that the of GBDC affect decision good the the that with if going point, we we we right way at. way. shareholder all that’s be paths made David, a But look of has this those That that’s out appropriate down. been will everybody respective be to at for votes might the path that Boards merger are

called Capital large private of very at we Golub Golub Partners a Capital, know, XX you fundraising Funds, we family are Partners the for creatively funds, also, and process As Golub the the have in at Capital of moment.

David Miyazaki

X what Okay. you of size Capital what size Golub Is there BDC is your targeted is? fundraising the – or have disclosed

David Golub

filer. public a It’s

can and fair both of in filings. of the see its You the commitments SEC assets value size its

David Miyazaki

little just Thank And you. okay. Okay, then shift bit. to gears a

from had that is in One COVID-resistant to recovery as me heard going between focus beginning of forward, BDCs of away is between COVID-resistant recession-resistant? while two. size you the And industries. where this And they you I ones of the the lot had unrealized we’ve sizable the is were a it resistance in the things to that I’m when losses. is have that probably in on and of specific think managed and there how that couple your hear the their look just was mean we acyclical industries go I companies. margin of would given industry a said a successful has on situated to of before their be underwriting because now don’t best that COVID the to sort What And are credit what pretty seems prior but COVID anytime is a it through soon, the to portfolio a overlap backdrop thought or against difference companies origination protections of the COVID-resistant focused recession measure or – had much you is pandemic and years go? way or problems,

David Golub

distressed get we think degree think pandemics new potential would strain that ruled companies I be who the loading There are on there of factor an going to vaccines to movie not, amusement how it a be lender resisting can to congregating forget long we’re ever don’t a I’m take, ships term, focused all something are like. I with element debt being that variety to and the mean that’s hedge about of and to timeframes think parks not on going disagree effective, longer there’s are call time. close I that’s COVID-resistant back of an whether prudent what that in such COVID-resistant as I what out? In think changed. similar long around And theaters of mutant going now. but context, be fund process global vaccination to that near-term, is assuming to think going I that’s companies, mean cruise and to whole that’s to we get are credits, about underwriting downside here. going I pandemic does we underwriting Does some a we and that are are players factor for proximity that are in me because a think case? a to it’s the borrowers In this right as need to Well, be normal, but a and the going up uncertainty doing. two think be going looked of the people Probably in has risk to we need that forever idea in prudent. vaccines,

going interesting see dynamic to be it’s how So, to plays David. that out,

think question players your see likely I to we’re different approach ways. different in

David Miyazaki

appreciate congratulations Well, great. quarter. I insight a on and nice your Okay,

David Golub

joining Well, for David. thanks, everyone, us today. you, Thank

to Golub a to please feel forward to the As any always, if have out free reach opportunity Capital look member questions, to the I next quarter. you team. talk And of further again having

Operator

conference today’s call. concludes This

may disconnect. now You