UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-02958
T. Rowe Price International Funds, Inc.
(Exact name of registrant as specified in charter)
100 East Pratt Street, Baltimore, MD 21202
(Address of principal executive offices)
David Oestreicher
100 East Pratt Street, Baltimore, MD 21202
(Name and address of agent for service)
Registrant’s telephone number, including area code: (410) 345-2000
Date of fiscal year end: December 31
Date of reporting period: June 30, 2024
Item 1. Reports to Shareholders
(a) Report pursuant to Rule 30e-1
Semi-Annual Shareholder Report
June 30, 2024
This semi-annual shareholder report contains important information about Dynamic Credit Fund (the "fund") for the period of January 1, 2024 to June 30, 2024. You can find the fund’s prospectus, financial information on Form N‑CSR (which includes required tax information for dividends), holdings, proxy voting information, and other information atwww.troweprice.com/prospectus. You can also request this information without charge by contacting T. Rowe Price at 1‑800‑638‑5660 or info@troweprice.com or contacting your intermediary.
What were the fund costs for the last six months? (based on a hypothetical $10,000 investment)
| | Costs of a $10,000 investment | Costs paid as a percentage of a $10,000 investment |
|---|
| Dynamic Credit Fund - Investor Class | $32 | 0.63% |
What are some fund statistics?
| Total Net Assets (000s) | $976,922 |
| Number of Portfolio Holdings | 279 |
| |
| Portfolio Turnover Rate | 104.3% |
What did the fund invest in?
Credit Quality Allocation* (as a % of Net Assets)
| AAA Rated | 0.2% |
| AA Rated | 0.3 |
| A Rated | 3.2 |
| BBB Rated | 13.4 |
| BB Rated and Below | 56.2 |
| Default | 0.2 |
| Not Rated | 14.9 |
| U.S. Treasury Securities | 7.0 |
| Reserves | 4.6 |
*Credit ratings for the securities held in the Fund are provided by Moody’s, Standard & Poor’s, and Fitch and are converted to the Standard & Poor’s nomenclature. A rating of AAA represents the highest-rated securities, and a rating of D represents the lowest rated securities. If the ratings agencies differ, the highest rating is applied to the security. If a rating is not available, the security is classified as Not Rated. The rating of the underlying investment vehicle is used to determine the creditworthiness of credit default swaps and sovereign securities. The Fund is not rated by any agency.
Top Ten Holdings (as a % of Net Assets)
| U.S. Treasury Bills | 6.9% |
| Republic of Ivory Coast | 2.9 |
| Cloud Software Group | 2.8 |
| Jane Street Group | 2.2 |
| Asurion | 2.0 |
| Vmed O2 U.K. Financing I | 1.8 |
| CyrusOne Data Centers Issuer I | 1.7 |
| Neptune Bidco U.S. | 1.7 |
| Republic of South Africa | 1.6 |
| Navient | 1.5 |
If you invest directly with T. Rowe Price, you can elect to receive future shareholder reports or other important documents through electronic delivery by enrolling at www.troweprice.com/paperless. If you invest through a financial intermediary such as an investment advisor, a bank, retirement plan sponsor or a brokerage firm, please contact that organization and ask if it can provide electronic delivery.
Dynamic Credit Fund
Investor Class (RPIDX)
T. Rowe Price Investment Services, Inc.
100 East Pratt Street
Baltimore, MD 21202
Semi-Annual Shareholder Report
June 30, 2024
This semi-annual shareholder report contains important information about Dynamic Credit Fund (the "fund") for the period of January 1, 2024 to June 30, 2024. You can find the fund’s prospectus, financial information on Form N‑CSR (which includes required tax information for dividends), holdings, proxy voting information, and other information atwww.troweprice.com/prospectus. You can also request this information without charge by contacting T. Rowe Price at 1‑800‑638‑5660 or info@troweprice.com or contacting your intermediary.
What were the fund costs for the last six months? (based on a hypothetical $10,000 investment)
| | Costs of a $10,000 investment | Costs paid as a percentage of a $10,000 investment |
|---|
| Dynamic Credit Fund - I Class | $28 | 0.56% |
What are some fund statistics?
| Total Net Assets (000s) | $976,922 |
| Number of Portfolio Holdings | 279 |
| |
| Portfolio Turnover Rate | 104.3% |
What did the fund invest in?
Credit Quality Allocation* (as a % of Net Assets)
| AAA Rated | 0.2% |
| AA Rated | 0.3 |
| A Rated | 3.2 |
| BBB Rated | 13.4 |
| BB Rated and Below | 56.2 |
| Default | 0.2 |
| Not Rated | 14.9 |
| U.S. Treasury Securities | 7.0 |
| Reserves | 4.6 |
*Credit ratings for the securities held in the Fund are provided by Moody’s, Standard & Poor’s, and Fitch and are converted to the Standard & Poor’s nomenclature. A rating of AAA represents the highest-rated securities, and a rating of D represents the lowest rated securities. If the ratings agencies differ, the highest rating is applied to the security. If a rating is not available, the security is classified as Not Rated. The rating of the underlying investment vehicle is used to determine the creditworthiness of credit default swaps and sovereign securities. The Fund is not rated by any agency.
Top Ten Holdings (as a % of Net Assets)
| U.S. Treasury Bills | 6.9% |
| Republic of Ivory Coast | 2.9 |
| Cloud Software Group | 2.8 |
| Jane Street Group | 2.2 |
| Asurion | 2.0 |
| Vmed O2 U.K. Financing I | 1.8 |
| CyrusOne Data Centers Issuer I | 1.7 |
| Neptune Bidco U.S. | 1.7 |
| Republic of South Africa | 1.6 |
| Navient | 1.5 |
If you invest directly with T. Rowe Price, you can elect to receive future shareholder reports or other important documents through electronic delivery by enrolling at www.troweprice.com/paperless. If you invest through a financial intermediary such as an investment advisor, a bank, retirement plan sponsor or a brokerage firm, please contact that organization and ask if it can provide electronic delivery.
Dynamic Credit Fund
I Class (RPELX)
T. Rowe Price Investment Services, Inc.
100 East Pratt Street
Baltimore, MD 21202
Semi-Annual Shareholder Report
June 30, 2024
This semi-annual shareholder report contains important information about Dynamic Credit Fund (the "fund") for the period of January 1, 2024 to June 30, 2024. You can find the fund’s prospectus, financial information on Form N‑CSR (which includes required tax information for dividends), holdings, proxy voting information, and other information atwww.troweprice.com/prospectus. You can also request this information without charge by contacting T. Rowe Price at 1‑800‑638‑5660 or info@troweprice.com or contacting your intermediary.
What were the fund costs for the last six months? (based on a hypothetical $10,000 investment)
| | Costs of a $10,000 investment | Costs paid as a percentage of a $10,000 investment |
|---|
| Dynamic Credit Fund - Z Class | $0 | 0.00% |
What are some fund statistics?
| Total Net Assets (000s) | $976,922 |
| Number of Portfolio Holdings | 279 |
| |
| Portfolio Turnover Rate | 104.3% |
What did the fund invest in?
Credit Quality Allocation* (as a % of Net Assets)
| AAA Rated | 0.2% |
| AA Rated | 0.3 |
| A Rated | 3.2 |
| BBB Rated | 13.4 |
| BB Rated and Below | 56.2 |
| Default | 0.2 |
| Not Rated | 14.9 |
| U.S. Treasury Securities | 7.0 |
| Reserves | 4.6 |
*Credit ratings for the securities held in the Fund are provided by Moody’s, Standard & Poor’s, and Fitch and are converted to the Standard & Poor’s nomenclature. A rating of AAA represents the highest-rated securities, and a rating of D represents the lowest rated securities. If the ratings agencies differ, the highest rating is applied to the security. If a rating is not available, the security is classified as Not Rated. The rating of the underlying investment vehicle is used to determine the creditworthiness of credit default swaps and sovereign securities. The Fund is not rated by any agency.
Top Ten Holdings (as a % of Net Assets)
| U.S. Treasury Bills | 6.9% |
| Republic of Ivory Coast | 2.9 |
| Cloud Software Group | 2.8 |
| Jane Street Group | 2.2 |
| Asurion | 2.0 |
| Vmed O2 U.K. Financing I | 1.8 |
| CyrusOne Data Centers Issuer I | 1.7 |
| Neptune Bidco U.S. | 1.7 |
| Republic of South Africa | 1.6 |
| Navient | 1.5 |
If you invest directly with T. Rowe Price, you can elect to receive future shareholder reports or other important documents through electronic delivery by enrolling at www.troweprice.com/paperless. If you invest through a financial intermediary such as an investment advisor, a bank, retirement plan sponsor or a brokerage firm, please contact that organization and ask if it can provide electronic delivery.
Dynamic Credit Fund
Z Class (TRCDX)
T. Rowe Price Investment Services, Inc.
100 East Pratt Street
Baltimore, MD 21202
Item 1. (b) Notice pursuant to Rule 30e-3.
Not applicable.
Item 2. Code of Ethics.
A code of ethics, as defined in Item 2 of Form N-CSR, applicable to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions is filed as an exhibit to the registrant’s annual Form N-CSR. No substantive amendments were approved or waivers were granted to this code of ethics during the registrant’s most recent fiscal half-year.
Item 3. Audit Committee Financial Expert.
Disclosure required in registrant’s annual Form N-CSR.
Item 4. Principal Accountant Fees and Services.
Disclosure required in registrant’s annual Form N-CSR.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Investments.
(a) Not applicable. The complete schedule of investments is included in Item 7 of this Form N-CSR.
(b) Not applicable.
Item 7. Financial Statements and Financial Highlights for Open-End Management Investment Companies.
(a – b) Report pursuant to Regulation S-X.
Financial
Highlights
Portfolio
of
Investments
Financial
Statements
and
Notes
Additional
Fund
Information
Financial
Statements
and
Other
Information
For
more
insights
from
T.
Rowe
Price
investment
professionals,
go
to
troweprice.com
.
T.
ROWE
PRICE
RPIDX
Dynamic
Credit
Fund
RPELX
Dynamic
Credit
Fund–
.
I Class
TRCDX
Dynamic
Credit
Fund–
.
Z Class
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Unaudited)
For
a
share
outstanding
throughout
each
period
Investor
Class
6
Months
.
Ended
6/30/24
..
Year
..
..
Ended
.
1/10/19
(1)
Through
12/31/19
12/31/23
12/31/22
12/31/21
12/31/20
NET
ASSET
VALUE
Beginning
of
period
$
8.84
$
9.02
$
9.83
$
9.75
$
10.20
$
10.00
Investment
activities
Net
investment
income
(2)(3)
0.33
0.55
0.41
0.37
0.48
0.44
Net
realized
and
unrealized
gain/
loss
(0.05)
(0.21)
(0.42)
0.24
(0.23)
0.21
Total
from
investment
activities
0.28
0.34
(0.01)
0.61
0.25
0.65
Distributions
Net
investment
income
(0.30)
(0.52)
(0.35)
(0.34)
(0.38)
(0.41)
Net
realized
gain
—
—
(0.45)
(0.19)
(0.32)
(0.04)
Total
distributions
(0.30)
(0.52)
(0.80)
(0.53)
(0.70)
(0.45)
NET
ASSET
VALUE
End
of
period
$
8.82
$
8.84
$
9.02
$
9.83
$
9.75
$
10.20
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Unaudited)
For
a
share
outstanding
throughout
each
period
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Investor
Class
6
Months
.
Ended
6/30/24
..
Year
..
..
Ended
.
1/10/19
(1)
Through
12/31/19
12/31/23
12/31/22
12/31/21
12/31/20
Ratios/Supplemental
Data
Total
return
(3)(4)
3.20%
3.89%
0.02%
6.21%
2.67%
6.64%
Ratios
to
average
net
assets:
(3)
Gross
expenses
before
waivers/
payments
by
Price
Associates
0.84%
(5)
1.31%
1.53%
1.30%
1.38%
1.56%
(5)
Net
expenses
after
waivers/
payments
by
Price
Associates
0.63%
(5)
0.64%
0.63%
0.65%
0.64%
0.64%
(5)
Net
investment
income
7.50%
(5)
6.14%
4.40%
3.61%
4.97%
4.44%
(5)
Portfolio
turnover
rate
104.3%
146.5%
217.6%
252.1%
301.7%
311.5%
Net
assets,
end
of
period
(in
thousands)
$19,267
$18,157
$29,716
$38,760
$26,423
$27,976
0%
0%
0%
0%
0%
0%
(1)
Inception
date
(2)
Per
share
amounts
calculated
using
average
shares
outstanding
method.
(3)
Includes
the
impact
of
expense-related
arrangements
with
Price
Associates.
(4)
Total
return
reflects
the
rate
that
an
investor
would
have
earned
on
an
investment
in
the
fund
during
each
period,
assuming
reinvestment
of
all
distributions,
and
payment
of
no
redemption
or
account
fees,
if
applicable.
Total
return
is
not
annualized
for
periods
less
than
one
year.
(5)
Annualized
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Unaudited)
For
a
share
outstanding
throughout
each
period
I
Class
6
Months
.
Ended
6/30/24
..
Year
..
..
Ended
.
1/10/19
(1)
Through
12/31/19
12/31/23
12/31/22
12/31/21
12/31/20
NET
ASSET
VALUE
Beginning
of
period
$
8.83
$
9.01
$
9.83
$
9.74
$
10.21
$
10.00
Investment
activities
Net
investment
income
(2)(3)
0.33
0.57
0.42
0.36
0.48
0.44
Net
realized
and
unrealized
gain/
loss
(0.05)
(0.22)
(0.43)
0.26
(0.25)
0.22
Total
from
investment
activities
0.28
0.35
(0.01)
0.62
0.23
0.66
Distributions
Net
investment
income
(0.30)
(0.53)
(0.36)
(0.34)
(0.38)
(0.41)
Net
realized
gain
—
—
(0.45)
(0.19)
(0.32)
(0.04)
Total
distributions
(0.30)
(0.53)
(0.81)
(0.53)
(0.70)
(0.45)
NET
ASSET
VALUE
End
of
period
$
8.81
$
8.83
$
9.01
$
9.83
$
9.74
$
10.21
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Unaudited)
For
a
share
outstanding
throughout
each
period
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
I
Class
6
Months
.
Ended
6/30/24
..
Year
..
..
Ended
.
1/10/19
(1)
Through
12/31/19
12/31/23
12/31/22
12/31/21
12/31/20
Ratios/Supplemental
Data
Total
return
(3)(4)
3.23%
3.97%
(0.01)%
6.36%
2.50%
6.77%
Ratios
to
average
net
assets:
(3)
Gross
expenses
before
waivers/
payments
by
Price
Associates
0.57%
(5)
0.94%
1.48%
1.06%
1.30%
1.62%
(5)
Net
expenses
after
waivers/
payments
by
Price
Associates
0.56%
(5)
0.56%
0.56%
0.60%
0.61%
0.61%
(5)
Net
investment
income
7.60%
(5)
6.43%
4.48%
3.51%
5.01%
4.48%
(5)
Portfolio
turnover
rate
104.3%
146.5%
217.6%
252.1%
301.7%
311.5%
Net
assets,
end
of
period
(in
thousands)
$31,352
$29,384
$5,646
$1,943
$24,169
$5,841
0%
0%
0%
0%
0%
0%
(1)
Inception
date
(2)
Per
share
amounts
calculated
using
average
shares
outstanding
method.
(3)
Includes
the
impact
of
expense-related
arrangements
with
Price
Associates.
(4)
Total
return
reflects
the
rate
that
an
investor
would
have
earned
on
an
investment
in
the
fund
during
each
period,
assuming
reinvestment
of
all
distributions,
and
payment
of
no
redemption
or
account
fees,
if
applicable.
Total
return
is
not
annualized
for
periods
less
than
one
year.
(5)
Annualized
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Unaudited)
For
a
share
outstanding
throughout
each
period
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Z
Class
(1)
6
Months
.
Ended
6/30/24
9/13/23
(1)
Through
12/31/23
NET
ASSET
VALUE
Beginning
of
period
$
8.83
$
8.82
Investment
activities
Net
investment
income
(2)(3)
0.36
0.19
Net
realized
and
unrealized
gain/loss
(0.05)
0.01
(4)
Total
from
investment
activities
0.31
0.20
Distributions
Net
investment
income
(0.33)
(0.19)
NET
ASSET
VALUE
End
of
period
$
8.81
$
8.83
Ratios/Supplemental
Data
Total
return
(3)(5)
3.51%
2.22%
Ratios
to
average
net
assets:
(3)
Gross
expenses
before
waivers/payments
by
Price
Associates
0.55%
(6)
0.55%
(6)
Net
expenses
after
waivers/payments
by
Price
Associates
0.00%
(6)
0.00%
(6)
Net
investment
income
8.15%
(6)
7.19%
(6)
Portfolio
turnover
rate
104.3%
146.5%
Net
assets,
end
of
period
(in
millions)
$926
$861
0%
0%
(1)
Inception
date
(2)
Per
share
amounts
calculated
using
average
shares
outstanding
method.
(3)
Includes
the
impact
of
expense-related
arrangements
with
Price
Associates.
(4)
The
amount
presented
is
inconsistent
with
the
fund's
aggregate
gains
and
losses
because
of
the
timing
of
sales
and
redemptions
of
fund
shares
in
relation
to
fluctuating
market
values
for
the
investment
portfolio.
(5)
Total
return
reflects
the
rate
that
an
investor
would
have
earned
on
an
investment
in
the
fund
during
each
period,
assuming
reinvestment
of
all
distributions,
and
payment
of
no
redemption
or
account
fees,
if
applicable.
Total
return
is
not
annualized
for
periods
less
than
one
year.
(6)
Annualized
T.
ROWE
PRICE
Dynamic
Credit
Fund
June
30,
2024
(Unaudited)
Par/Shares
$
Value
(
Cost
and
value
in
$000s)
‡
ANGOLA 1.3%
Government
Bonds 1.3%
Republic
of
Angola,
8.75%,
4/14/32
(USD)
14,725,000
13,068
Total
Angola
(Cost
$12,930)
13,068
BRAZIL 2.6%
Corporate
Bonds 2.6%
Braskem
Netherlands
Finance,
7.25%,
2/13/33
(USD) (1)
14,415,000
13,601
Raizen
Fuels
Finance,
6.45%,
3/5/34
(USD) (2)
5,910,000
6,007
Raizen
Fuels
Finance,
6.95%,
3/5/54
(USD) (2)
5,490,000
5,588
Total
Brazil
(Cost
$24,335)
25,196
CANADA 0.5%
Asset-Backed
Securities 0.0%
Cologix
Canadian
Issuer,
Series
2022-1CAN,
Class
A2,
4.94%,
1/25/52 (2)
250,000
170
170
Corporate
Bonds 0.5%
TER
Finance
Jersey,
Series
21,
Zero
Coupon,
1/2/25
(USD) (2)
(3)
4,900,000
4,738
4,738
Total
Canada
(Cost
$4,933)
4,908
CHILE 0.6%
Corporate
Bonds 0.6%
AES
Andes,
VR,
8.15%,
6/10/55
(USD) (1)(2)(4)
6,040,000
6,052
Total
Chile
(Cost
$6,040)
6,052
CHINA 1.3%
Convertible
Bonds 1.3%
H
World
Group,
3.00%,
5/1/26
(USD)
12,190,000
12,964
12,964
T.
ROWE
PRICE
Dynamic
Credit
Fund
Par/Shares
$
Value
(Cost
and
value
in
$000s)
Corporate
Bonds 0.0%
Kaisa
Group
Holdings,
11.95%,
10/22/22
(USD) (5)(6)
985,000
36
36
Total
China
(Cost
$14,196)
13,000
COLOMBIA 1.7%
Corporate
Bonds 1.7%
Aris
Mining,
6.875%,
8/9/26
(USD) (2)
380,000
357
Bancolombia
,
VR,
8.625%,
12/24/34
(USD) (4)
7,410,000
7,573
Ecopetrol
,
8.375%,
1/19/36
(USD)
8,370,000
8,227
16,157
Private
Investment
Company 0.0%
Bona
Fide
Investments
Feeder
LLC,
Acquisition
date:
6/1/22
-
12/22/23,
Cost $0
(USD) (6)(7)
†
1
Bona
Fide
Investments
Feeder
LLC,
Acquisition
date:
6/7/23,
Cost $15
(USD) (6)(7)
†
21
Bona
Fide
Investments
Holdings
III,
Acquisition
date:
6/14/24,
Cost $10
(USD) (6)(7)
†
10
32
Total
Colombia
(Cost
$16,137)
16,189
DENMARK 0.8%
Common
Stocks 0.8%
Novo
Nordisk,
ADR
(USD)
52,031
7,427
Total
Denmark
(Cost
$7,023)
7,427
EGYPT 1.5%
Government
Bonds 1.5%
Arab
Republic
of
Egypt,
Treasury
Bills,
Series
364D,
25.802%,
9/24/24
228,500,000
4,505
Arab
Republic
of
Egypt,
Treasury
Bills,
Series
364D,
26.918%,
12/24/24
261,575,000
4,859
Arab
Republic
of
Egypt,
Treasury
Bills,
Series
364D,
30.00%,
9/17/24
264,125,000
5,232
Total
Egypt
(Cost
$14,602)
14,596
T.
ROWE
PRICE
Dynamic
Credit
Fund
Par/Shares
$
Value
(Cost
and
value
in
$000s)
EL
SALVADOR 0.3%
Government
Bonds 0.3%
Republic
of
El
Salvador,
0.25%,
4/17/30
(USD) (2)
3,580,000
111
Republic
of
El
Salvador,
9.25%,
4/17/30
(USD) (2)
3,580,000
3,190
Total
El
Salvador
(Cost
$3,266)
3,301
FRANCE 1.3%
Corporate
Bonds 1.3%
Altice
France
Holding,
10.50%,
5/15/27
(USD) (2)
14,003,000
5,531
Societe
Generale
,
VR,
10.00%
(USD) (2)(4)(8)
6,880,000
7,138
Total
France
(Cost
$15,703)
12,669
GHANA 1.5%
Corporate
Bonds 1.5%
Kosmos
Energy,
7.125%,
4/4/26
(USD)
14,745,000
14,596
Total
Ghana
(Cost
$14,087)
14,596
ITALY 1.5%
Corporate
Bonds 1.5%
Golden
Goose,
FRN,
3M
EURIBOR
+
4.875%,
8.703%,
5/14/27
13,939,000
14,779
Total
Italy
(Cost
$14,788)
14,779
IVORY
COAST 2.9%
Government
Bonds 2.9%
Republic
of
Ivory
Coast,
5.875%,
10/17/31
(EUR)
295,000
286
Republic
of
Ivory
Coast,
6.125%,
6/15/33
(USD)
16,224,000
14,424
Republic
of
Ivory
Coast,
7.625%,
1/30/33
(USD) (2)
6,540,000
6,363
Republic
of
Ivory
Coast,
8.25%,
1/30/37
(USD) (2)
7,360,000
7,144
Total
Ivory
Coast
(Cost
$27,471)
28,217
T.
ROWE
PRICE
Dynamic
Credit
Fund
Par/Shares
$
Value
(Cost
and
value
in
$000s)
LUXEMBOURG 0.8%
Bank
Loans 0.2% (9)
Travelport
Finance,
FRN,
3M
TSFR
+
8.26%,
10.078%,
9/29/28
(USD)
2,806,536
2,540
2,540
Corporate
Bonds 0.6%
Altice
Financing,
9.625%,
7/15/27
(USD) (2)
6,098,000
5,610
5,610
Total
Luxembourg
(Cost
$8,739)
8,150
MAURITIUS 0.6%
Corporate
Bonds 0.6%
Axian
Telecom,
7.375%,
2/16/27
(USD) (2)
200,000
198
Axian
Telecom,
7.375%,
2/16/27
(USD)
5,500,000
5,438
Total
Mauritius
(Cost
$5,227)
5,636
MEXICO 4.3%
Corporate
Bonds 4.2%
BBVA
Bancomer
,
VR,
8.125%,
1/8/39
(USD) (2)(4)
13,695,000
13,878
Braskem
Idesa
SAPI,
6.99%,
2/20/32
(USD) (1)
4,283,000
3,252
Metalsa
,
3.75%,
5/4/31
(USD) (1)(2)
6,195,000
4,944
Petroleos
Mexicanos
,
6.70%,
2/16/32
(USD)
700,000
587
Petroleos
Mexicanos
,
10.00%,
2/7/33
(USD) (1)
7,304,000
7,335
Sixsigma
Networks
Mexico,
7.50%,
5/2/25
(USD)
10,920,000
10,502
40,498
Government
Bonds 0.1%
United
Mexican
States,
Series
M,
7.75%,
11/13/42
21,390,000
943
943
Total
Mexico
(Cost
$40,403)
41,441
MONTENEGRO 0.5%
Government
Bonds 0.5%
Republic
of
Montenegro,
7.25%,
3/12/31
(USD) (2)
5,210,000
5,235
Total
Montenegro
(Cost
$5,210)
5,235
T.
ROWE
PRICE
Dynamic
Credit
Fund
Par/Shares
$
Value
(Cost
and
value
in
$000s)
PANAMA 1.1%
Government
Bonds 1.1%
Republic
of
Panama,
7.50%,
3/1/31
(USD)
3,960,000
4,149
Republic
of
Panama,
7.875%,
3/1/57
(USD)
1,690,000
1,764
Republic
of
Panama,
8.00%,
3/1/38
(USD)
4,760,000
5,024
Total
Panama
(Cost
$10,339)
10,937
ROMANIA 0.6%
Corporate
Bonds 0.6%
Banca
Transilvania
,
VR,
8.875%,
4/27/27
(EUR) (4)
4,929,000
5,577
Total
Romania
(Cost
$5,376)
5,577
SENEGAL 0.9%
Government
Bonds 0.9%
Republic
of
Senegal,
6.25%,
5/23/33
(USD)
10,745,000
9,037
Total
Senegal
(Cost
$9,267)
9,037
SOUTH
AFRICA 1.6%
Government
Bonds 1.6%
Republic
of
South
Africa,
Series
2048,
8.75%,
2/28/48
371,600,000
15,258
Total
South
Africa
(Cost
$14,545)
15,258
SPAIN 0.0%
Corporate
Bonds 0.0%
Cirsa
Finance
International,
4.50%,
3/15/27
157,000
165
Total
Spain
(Cost
$154)
165
SRI
LANKA 1.5%
Government
Bonds 1.5%
Republic
of
Sri
Lanka,
6.125%,
6/3/25
(USD) (1)(5)(6)
4,974,000
2,950
Republic
of
Sri
Lanka,
6.825%,
7/18/26
(USD) (1)(5)(6)
6,525,000
3,877
Republic
of
Sri
Lanka,
6.85%,
11/3/25
(USD) (5)(6)
610,000
362
Republic
of
Sri
Lanka,
7.85%,
3/14/29
(USD) (5)(6)
11,866,000
7,066
Total
Sri
Lanka
(Cost
$13,945)
14,255
T.
ROWE
PRICE
Dynamic
Credit
Fund
Par/Shares
$
Value
(Cost
and
value
in
$000s)
SURINAME 0.0%
Government
Bonds 0.0%
Republic
of
Suriname,
7.95%,
7/15/33,
(4.95%
Cash
and
3.00%
PIK)
(USD) (2)(10)
271,463
254
Republic
of
Suriname,
VR,
9.00%,
12/31/50
(USD) (2)
130,000
104
Total
Suriname
(Cost
$267)
358
TÜRKIYE 1.0%
Corporate
Bonds 1.0%
Sisecam
U.K.,
8.25%,
5/2/29
(USD) (1)(2)
4,360,000
4,433
Sisecam
U.K.,
8.625%,
5/2/32
(USD) (2)
5,560,000
5,665
Total
Türkiye
(Cost
$9,920)
10,098
UKRAINE 0.6%
Corporate
Bonds 0.6%
Kernel
Holding,
6.50%,
10/17/24
(USD)
5,745,000
5,312
Total
Ukraine
(Cost
$5,491)
5,312
UNITED
KINGDOM 3.3%
Bank
Loans 1.5% (9)
CD&R
Firefly
Bidco
,
FRN,
3M
EURIBOR
+
4.50%,
8.363%,
6/21/28
(EUR)
6,420,000
6,865
CD&R
Firefly
Bidco
,
FRN,
GBP
SONIA
+
5.75%,
10.95%,
6/21/28
4,670,000
5,902
ZPG,
FRN,
GBP
SONIA
+
5.50%,
10.70%,
7/31/28
1,250,000
1,586
14,353
Convertible
Bonds 0.0%
Immunocore
Holdings,
2.50%,
2/1/30
(USD) (2)
553,000
461
461
Corporate
Bonds 1.8%
Vmed
O2
U.K.
Financing
I,
7.75%,
4/15/32
(USD) (2)
18,250,000
17,817
17,817
Total
United
Kingdom
(Cost
$33,032)
32,631
T.
ROWE
PRICE
Dynamic
Credit
Fund
Par/Shares
$
Value
(Cost
and
value
in
$000s)
UNITED
STATES 54.8%
Asset-Backed
Securities 13.0%
Apidos
XXXII,
Series
2019-32A,
Class
DR,
CLO,
FRN,
3M
TSFR
+
2.75%,
8.093%,
1/20/33 (2)
2,110,000
2,110
Ares
XXXVII,
Series
2015-4A,
Class
CRR,
CLO,
FRN,
3M
TSFR
+
2.75%,
8.08%,
10/15/30 (2)
1,780,000
1,769
Auxilior
Term
Funding,
Series
2023-1A,
Class
E,
10.97%,
12/15/32 (2)
6,770,000
6,784
Bayview
Opportunity
Master
Fund
VII,
Series
2024-CAR1,
Class
E,
FRN,
SOFR30A
+
3.60%,
8.935%,
12/26/31 (2)
2,855,626
2,863
Blackbird
Capital
Aircraft
Lease
Securitization,
Series
2016-1A,
Class
A,
STEP,
4.213%,
12/16/41 (2)
206,189
204
Carvana
Auto
Receivables
Trust,
Series
2024-N2,
Class
E,
8.16%,
6/10/31 (2)
7,300,000
7,299
CyrusOne
Data
Centers
Issuer
I,
Series
2024-2A,
Class
A2,
4.50%,
5/20/49 (2)
9,290,000
8,608
CyrusOne
Data
Centers
Issuer
I,
Series
2024-3A,
Class
A2,
4.65%,
5/20/49 (2)
8,820,000
7,981
Driven
Brands
Funding,
Series
2018-1A,
Class
A2,
4.739%,
4/20/48 (2)
6,410,800
6,321
Driven
Brands
Funding,
Series
2019-2A,
Class
A2,
3.981%,
10/20/49 (2)
4,283,175
4,080
Elara
HGV
Timeshare
Issuer,
Series
2019-A,
Class
C,
3.45%,
1/25/34 (2)
35,546
34
Elara
HGV
Timeshare
Issuer,
Series
2023-A,
Class
D,
10.10%,
2/25/38 (2)
155,598
160
ExteNet
,
Series
2019-1A,
Class
B,
4.14%,
7/25/49 (2)
240,000
239
FOCUS
Brands
Funding,
Series
2017-1A,
Class
A2II,
5.093%,
4/30/47 (2)
2,101,800
2,037
FOCUS
Brands
Funding,
Series
2023-2,
Class
A2,
8.241%,
10/30/53 (2)
8,885,350
9,404
Hardee's
Funding,
Series
2020-1A,
Class
A2,
3.981%,
12/20/50 (2)
1,606,292
1,460
Hardee's
Funding,
Series
2021-1A,
Class
A2,
2.865%,
6/20/51 (2)
1,222,200
1,050
Hardee's
Funding,
Series
2024-1A,
Class
A2,
7.253%,
3/20/54 (2)
9,885,225
9,923
Hilton
Grand
Vacations
Trust,
Series
2024-1B,
Class
D,
8.85%,
9/15/39 (2)
2,688,651
2,725
Huntington
Bank
Auto
Credit-Linked
Notes,
Series
2024-1,
Class
C,
FRN,
SOFR30A
+
3.15%,
8.483%,
5/20/32 (2)
2,750,000
2,750
MVW,
Series
2023-2A,
Class
D,
9.33%,
11/20/40 (2)
5,153,264
5,239
T.
ROWE
PRICE
Dynamic
Credit
Fund
Par/Shares
$
Value
(Cost
and
value
in
$000s)
Octane
Receivables
Trust,
Series
2023-1A,
Class
E,
9.25%,
8/20/30 (2)
255,000
255
Post
Road
Equipment
Finance,
Series
2024-1A,
Class
E,
8.50%,
12/15/31 (2)
3,338,000
3,205
Progress
Residential
Trust,
Series
2020-SFR3,
Class
F,
2.796%,
10/17/27 (2)
130,000
124
Regatta
XIII
Funding,
Series
2018-2A,
Class
CR,
CLO,
FRN,
3M
TSFR
+
2.70%,
7/15/31 (2)(11)
5,340,000
5,340
Santander
Bank
Auto
Credit-Linked
Notes,
Series
2023-A,
Class
E,
10.068%,
6/15/33 (2)
125,961
128
Santander
Bank
Auto
Credit-Linked
Notes,
Series
2023-B,
Class
E,
8.408%,
12/15/33 (2)
5,500,000
5,503
SCF
Equipment
Leasing,
Series
2022-1A,
Class
F,
6.00%,
7/20/32 (2)
5,650,000
5,434
SCF
Equipment
Leasing,
Series
2024-1A,
Class
E,
9.00%,
12/20/34 (2)
3,300,000
3,268
SEB
Funding,
Series
2024-1A,
Class
A2,
7.386%,
4/30/54 (2)
14,435,000
14,640
Sierra
Timeshare
Receivables
Funding,
Series
2021-1A,
Class
D,
3.17%,
11/20/37 (2)
139,830
133
Sierra
Timeshare
Receivables
Funding,
Series
2023-3A,
Class
D,
9.44%,
9/20/40 (2)
4,099,356
4,174
Sierra
Timeshare
Receivables
Funding,
Series
2024-1A,
Class
D,
8.02%,
1/20/43 (2)
1,978,814
1,991
Stonepeak
ABS,
Series
2021-1A,
Class
B,
3.821%,
2/28/33 (2)
167,629
152
127,387
Bank
Loans 12.9% (9)
Asurion
,
FRN,
1M
TSFR
+
4.25%,
9.694%,
8/19/28
19,684,499
19,515
Asurion
,
FRN,
1M
TSFR
+
5.25%,
10.708%,
1/31/28
185,904
173
Boxer
Parent,
FRN,
1M
TSFR
+
4.00%,
9.344%,
12/29/28
6,780,925
6,787
Caesars
Entertainment,
FRN,
1M
TSFR
+
2.75%,
8.097%,
2/6/31
14,114,625
14,101
Chromalloy,
FRN,
1M
TSFR
+
3.75%,
9.082%,
3/27/31
13,990,000
14,008
Cloud
Software
Group,
FRN,
1M
TSFR
+
4.00%,
9.335%,
3/30/29
10,781,445
10,765
CMG
Media,
FRN,
3M
TSFR
+
3.50%,
8.935%,
12/17/26
1,454,961
1,151
CSC
Holdings,
FRN,
1M
TSFR
+
4.50%,
9.829%,
1/18/28
9,834,999
9,435
Ellucian
Holdings,
FRN,
1M
TSFR
+
3.50%,
8.944%,
10/9/29
6,457,578
6,482
LTI
Holdings,
FRN,
1M
TSFR
+
3.50%,
8.958%,
9/6/25
6,725,501
6,616
NGL
Energy
Operating,
FRN,
1M
TSFR
+
4.50%,
9.844%,
2/3/31
3,406,463
3,414
Radiate
Holdco,
FRN,
1M
TSFR
+
3.25%,
8.708%,
9/25/26
11,396,556
9,205
RFS
OPCO,
FRN,
1M
TSFR
+
5.00%,
10.335%,
4/4/31 (3)
6,280,000
6,217
Talen
Energy
Supply,
FRN,
1M
TSFR
+
3.50%,
8.827%,
5/17/30
10,111,859
10,209
T.
ROWE
PRICE
Dynamic
Credit
Fund
Par/Shares
$
Value
(Cost
and
value
in
$000s)
Vistra
Zero
Operating,
FRN,
1M
TSFR
+
2.75%,
8.094%,
4/30/31
7,561,050
7,591
William
Morris
Endeavor
Entertainment,
FRN,
1M
TSFR
+
2.75%,
8.208%,
5/18/25
730,044
731
126,400
Common
Stocks 3.5%
Altera
Infrastructure,
Acquisition
Date:
1/19/23,
Cost $13 (3)(6)
(7)
639
18
Booz
Allen
Hamilton
Holding
61,343
9,441
Citigroup
109,886
6,973
Eli
Lilly
6,441
5,832
Merck
53,382
6,609
Toll
Brothers
64
7
Walmart
81,176
5,497
34,377
Convertible
Bonds 4.6%
Coinbase
Global,
0.25%,
4/1/30 (2)
10,260,000
9,920
Kobold
Metals,
Acquisition
date:
3/6/24,
Cost $3,705,
2/26/25 (3)(6)(7)
3,705,000
3,705
Royal
Caribbean
Cruises,
6.00%,
8/15/25
3,225,000
10,378
Southern,
4.50%,
6/15/27 (2)
9,201,000
9,305
Wolfspeed
,
0.25%,
2/15/28
981,000
582
Wolfspeed
,
1.875%,
12/1/29
19,595,000
10,917
44,807
Corporate
Bonds 16.7%
AP
Grange
Holdings,
Acquisition
date:
6/12/24,
Cost $8,925,
6.50%,
3/20/45 (3)(6)(7)
8,925,000
8,925
At
Home
Group,
4.875%,
7/15/28 (2)
210,000
85
CHS,
10.875%,
1/15/32 (2)
5,655,000
5,895
Cloud
Software
Group,
8.25%,
6/30/32 (2)
9,545,000
9,700
Cloud
Software
Group,
9.00%,
9/30/29 (1)(2)
7,175,000
6,960
Comstock
Resources,
6.75%,
3/1/29 (2)
11,350,000
10,896
DISH
DBS,
5.25%,
12/1/26 (2)
9,430,000
7,450
DISH
DBS,
7.75%,
7/1/26
6,145,000
3,795
Gray
Television,
10.50%,
7/15/29 (2)
9,320,000
9,378
Icahn
Enterprises,
9.00%,
6/15/30 (2)
12,450,000
12,357
Jane
Street
Group,
7.125%,
4/30/31 (2)
21,045,000
21,519
Level
3
Financing,
10.50%,
5/15/30 (2)
4,700,000
4,671
Navient
,
11.50%,
3/15/31
13,445,000
14,806
Neptune
Bidco
U.S.,
9.29%,
4/15/29 (2)
17,130,000
16,445
Scientific
Games
Holdings,
6.625%,
3/1/30 (2)
4,300,000
4,192
Starwood
Property
Trust,
7.25%,
4/1/29 (2)
11,780,000
11,868
Tenneco,
8.00%,
11/17/28 (2)
8,828,000
8,033
T.
ROWE
PRICE
Dynamic
Credit
Fund
Par/Shares
$
Value
(Cost
and
value
in
$000s)
Venture
Global
LNG,
9.875%,
2/1/32 (2)
5,655,000
6,143
163,118
Municipal
Securities 2.0%
Colorado
HFA,
Covenant
Living
Community,
Series
B,
4.48%,
12/1/40
235,000
195
Michigan
Tobacco
Settlement
Fin.
Auth.,
Series
B,
Zero
Coupon,
6/1/46
25,000
3
Port
Beaumont
Navigation
Dist.,
Series
B,
6.00%,
1/1/25
(
Prerefunded
7/1/24) (2)(12)
210,000
210
Port
Beaumont
Navigation
Dist.,
Series
B,
10.00%,
7/1/26 (2)
10,720,000
10,738
Puerto
Rico
Commonwealth,
GO,
VR,
11/1/43 (13)
11,784,795
7,218
Puerto
Rico
Commonwealth,
Restructured,
Series
A,
GO,
Zero
Coupon,
7/1/24
6,837
7
Puerto
Rico
Commonwealth,
Restructured,
Series
A,
GO,
Zero
Coupon,
7/1/33
53,960
36
Puerto
Rico
Commonwealth,
Restructured,
Series
A-1,
GO,
4.00%,
7/1/33
41,930
42
Puerto
Rico
Commonwealth,
Restructured,
Series
A-1,
GO,
4.00%,
7/1/35
37,689
37
Puerto
Rico
Commonwealth,
Restructured,
Series
A-1,
GO,
4.00%,
7/1/37
32,347
31
Puerto
Rico
Commonwealth,
Restructured,
Series
A-1,
GO,
4.00%,
7/1/41
43,980
41
Puerto
Rico
Commonwealth,
Restructured,
Series
A-1,
GO,
4.00%,
7/1/46
45,738
41
Puerto
Rico
Commonwealth,
Restructured,
Series
A-1,
GO,
5.375%,
7/1/25
23,317
24
Puerto
Rico
Commonwealth,
Restructured,
Series
A-1,
GO,
5.625%,
7/1/27
46,276
48
Puerto
Rico
Commonwealth,
Restructured,
Series
A-1,
GO,
5.625%,
7/1/29
45,524
49
Puerto
Rico
Commonwealth,
Restructured,
Series
A-1,
GO,
5.75%,
7/1/31
44,217
49
Puerto
Rico
Electric
Power
Auth.,
Build
America,
5.95%,
7/1/30 (6)(14)
40,000
20
Puerto
Rico
Electric
Power
Auth.,
Build
America,
6.05%,
7/1/32 (6)(14)
150,000
75
Tobacco
Settlement
Fin.,
Series
A-1,
6.706%,
6/1/46
250,000
212
Tobacco
Settlement
Fin.
Auth.,
Series
B,
4.875%,
6/1/49
90,000
86
Tobacco
Settlement
Fin.
Auth.,
Series
B,
Zero
Coupon,
6/1/47
460,000
42
19,204
Non-U.S.
Government
Mortgage-Backed
Securities 2.1%
Alen
Mortgage
Trust,
Series
2021-ACEN,
Class
A,
ARM,
1M
TSFR
+
1.264%,
6.593%,
4/15/34 (2)
2,120,000
1,930
T.
ROWE
PRICE
Dynamic
Credit
Fund
Par/Shares
$
Value
(Cost
and
value
in
$000s)
Barclays
Commercial
Mortgage
Trust,
Series
2019-BWAY,
Class
E,
ARM,
1M
TSFR
+
2.964%,
8.293%,
11/15/34 (2)
120,000
1
BSREP
Commercial
Mortgage
Trust,
Series
2021-DC,
Class
C,
ARM,
1M
TSFR
+
1.664%,
6.993%,
8/15/38 (2)
1,170,417
989
BX
Trust,
Series
2021-VIEW,
Class
F,
ARM,
1M
TSFR
+
4.044%,
9.373%,
6/15/36 (2)
145,000
129
CAFL,
Series
2021-RTL1,
Class
A1,
CMO,
STEP,
2.239%,
3/28/29 (2)
83,007
81
CAMB
Commercial
Mortgage
Trust,
Series
2019-LIFE,
Class
D,
ARM,
1M
TSFR
+
2.047%,
7.376%,
12/15/37 (2)
718,782
719
CAMB
Commercial
Mortgage
Trust,
Series
2019-LIFE,
Class
E,
ARM,
1M
TSFR
+
2.447%,
7.776%,
12/15/37 (2)
2,912,500
2,907
Cantor
Commercial
Real
Estate
Lending,
Series
2019-CF1,
Class
65C,
ARM,
4.123%,
5/15/52 (2)
115,000
63
Cantor
Commercial
Real
Estate
Lending,
Series
2019-CF1,
Class
65D,
ARM,
4.66%,
5/15/52 (2)
70,000
25
Commercial
Mortgage
Trust,
Series
2014-CR19,
Class
AM,
4.08%,
8/10/47
28,810
29
Commercial
Mortgage
Trust,
Series
2017-PANW,
Class
D,
ARM,
4.343%,
10/10/29 (2)
305,000
272
Finance
of
America
HECM
Buyout,
Series
2022-HB1,
Class
M3,
ARM,
5.084%,
2/25/32 (2)
390,000
377
HILT
Commercial
Mortgage
Trust,
Series
2024-ORL,
Class
C,
ARM,
1M
TSFR
+
2.44%,
7.769%,
5/15/37 (2)
7,195,000
7,177
LSTAR
Commercial
Mortgage
Trust,
Series
2017-5,
Class
D,
ARM,
4.823%,
3/10/50 (2)
220,000
171
Oceanview
Mortgage
Loan
Trust,
Series
2020-1,
Class
A3,
CMO,
ARM,
3.285%,
5/28/50 (2)
115,000
95
TX
Trust,
Series
2024-HOU,
Class
D,
ARM,
1M
TSFR
+
3.239%,
8.558%,
6/15/39 (2)
2,805,000
2,780
Verus
Securitization
Trust,
Series
2021-2,
Class
M1,
CMO,
ARM,
2.187%,
2/25/66 (2)
150,000
111
Verus
Securitization
Trust,
Series
2021-5,
Class
M1,
CMO,
ARM,
2.331%,
9/25/66 (2)
3,270,000
2,224
20,080
Total
United
States
(Cost
$526,846)
535,373
SHORT-TERM
INVESTMENTS 8.9%
Money
Market
Funds 1.9%
T.
Rowe
Price
Government
Reserve
Fund,
5.38% (15)(16)
18,836,104
18,836
18,836
T.
ROWE
PRICE
Dynamic
Credit
Fund
Par/Shares
$
Value
(Cost
and
value
in
$000s)
U.S.
Treasury
Obligations 7.0%
U.S.
Treasury
Bills,
6.091%,
8/22/24 (17)
68,020,000
67,508
67,508
Total
Short-Term
Investments
(Cost
$86,341)
86,344
SECURITIES
LENDING
COLLATERAL 1.1%
INVESTMENTS
IN
A
POOLED
ACCOUNT
THROUGH
SECURITIES
LENDING
PROGRAM
WITH
JPMORGAN
CHASE
BANK 0.2%
Money
Market
Funds 0.2%
T.
Rowe
Price
Government
Reserve
Fund,
5.38% (15)(16)
1,899,062
1,899
Total
Investments
in
a
Pooled
Account
through
Securities
Lending
Program
with
JPMorgan
Chase
Bank
1,899
INVESTMENTS
IN
A
POOLED
ACCOUNT
THROUGH
SECURITIES
LENDING
PROGRAM
WITH
STATE
STREET
BANK
AND
TRUST
COMPANY 0.9%
Money
Market
Funds 0.9%
T.
Rowe
Price
Government
Reserve
Fund,
5.38% (15)(16)
9,332,055
9,332
Total
Investments
in
a
Pooled
Account
through
Securities
Lending
Program
with
State
Street
Bank
and
Trust
Company
9,332
Total
Securities
Lending
Collateral
(Cost
$11,231)
11,231
(Amounts
in
000s,
except
for
contracts)
OPTIONS
PURCHASED 0.6%
OTC
Options
Purchased
0.6%
Counterparty
Description
Contracts
Notional
Amount
$
Value
Bank
of
America
USD
/
JPY
Call,
9/5/24
@
JPY156.00 (6)
1
137,750
3,958
Barclays
Bank
30
Year
Interest
Rate
Swap,
8/12/54
Pay
Fixed
3.80%
Annually,
Receive
Variable
5.33%
(SOFR)
Annually,
8/8/24
@
3.80%* (6)
2
83,029
1,287
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Amounts
in
000s,
except
for
contracts)
Counterparty
Description
Contracts
Notional
Amount
$
Value
Barclays
Bank
30
Year
Interest
Rate
Swap,
8/13/54
Pay
Fixed
3.80%
Annually,
Receive
Variable
5.33%
(SOFR)
Annually,
8/9/24
@
3.80%* (6)
1
11,638
183
Goldman
Sachs
30
Year
Interest
Rate
Swap,
8/13/54
Pay
Fixed
3.80%
Annually,
Receive
Variable
5.33%
(SOFR)
Annually,
8/9/24
@
3.80%* (6)
1
5,819
92
Morgan
Stanley
2
Year
Interest
Rate
Swap,
7/2/26
Pay
Fixed
4.75%
Annually,
Receive
Variable
5.33%
(SOFR)
Annually,
6/28/24
@
4.75%* (6)
1
752,445
—
Morgan
Stanley
30
Year
Interest
Rate
Swap,
8/12/54
Pay
Fixed
3.80%
Annually,
Receive
Variable
5.33%
(SOFR)
Annually,
8/8/24
@
3.80%* (6)
1
5,819
90
Morgan
Stanley
30
Year
Interest
Rate
Swap,
8/13/54
Pay
Fixed
3.80%
Annually,
Receive
Variable
5.33%
(SOFR)
Annually,
8/9/24
@
3.80%* (6)
1
11,638
183
Total
Options
Purchased
(Cost
$5,108)
5,793
Total
Investments
in
Securities
100.0%
of
Net
Assets
(Cost
$966,952)
$
976,829
T.
ROWE
PRICE
Dynamic
Credit
Fund
‡
Country
classifications
are
generally
based
on
MSCI
categories
or
another
unaffiliated
third
party
data
provider;
Par/Shares
and
Notional
Amount
are
denominated
in
the
currency
of
the
country
presented
unless
otherwise
noted.
†
Investment
fund
is
not
unitized.
*
Exercise
Spread
(1)
See
Note
4
.
All
or
a
portion
of
this
security
is
on
loan
at
June
30,
2024.
(2)
Security
was
purchased
pursuant
to
Rule
144A
under
the
Securities
Act
of
1933
and
may
be
resold
in
transactions
exempt
from
registration
only
to
qualified
institutional
buyers.
Total
value
of
such
securities
at
period-end
amounts
to
$424,191
and
represents
43.4%
of
net
assets.
(3)
See
Note
2.
Level
3
in
fair
value
hierarchy.
(4)
Security
is
a
fix-to-float
security,
which
carries
a
fixed
coupon
until
a
certain
date,
upon
which
it
switches
to
a
floating
rate.
Reference
rate
and
spread
are
provided
if
the
rate
is
currently
floating.
(5)
Security
is
in
default
or
has
failed
to
make
a
scheduled
interest
and/or
principal
payment.
(6)
Non-income
producing
(7)
Security
cannot
be
offered
for
public
resale
without
first
being
registered
under
the
Securities
Act
of
1933
and
related
rules
("restricted
security").
Acquisition
date
represents
the
day
on
which
an
enforceable
right
to
acquire
such
security
is
obtained
and
is
presented
along
with
related
cost
in
the
security
description.
The
fund
may
have
registration
rights
for
certain
restricted
securities.
Any
costs
related
to
such
registration
are
generally
borne
by
the
issuer.
The
aggregate
value
of
restricted
securities
(excluding
144A
holdings)
at
period
end
amounts
to
$12,680
and
represents
1.3%
of
net
assets.
(8)
Perpetual
security
with
no
stated
maturity
date.
(9)
Bank
loan
positions
may
involve
multiple
underlying
tranches.
In
those
instances,
the
position
presented
reflects
the
aggregate
of
those
respective
underlying
tranches
and
the
rate
presented
reflects
the
weighted
average
rate
of
the
settled
positions.
(10)
Security
has
the
ability
to
pay
in-kind
or
pay
in
cash.
When
applicable,
separate
rates
of
such
payments
are
disclosed.
(11)
All
or
a
portion
of
this
loan
is
unsettled
as
of
June
30,
2024.
The
interest
rate
for
unsettled
loans
will
be
determined
upon
settlement
after
period
end.
(12)
Prerefunded
date
is
used
in
determining
portfolio
maturity.
(13)
Contingent
value
instrument
that
only
pays
out
if
a
portion
of
the
territory's
Sales
and
Use
Tax
outperforms
the
projections
in
the
Oversight
Board’s
Certified
Fiscal
Plan.
(14)
Issuer
is
currently
in
a
bankruptcy
reorganization
proceeding;
the
amount
and
timing
of
future
distributions
is
uncertain.
(15)
Seven-day
yield
(16)
Affiliated
Companies
(17)
At
June
30,
2024,
all
or
a
portion
of
this
security
is
pledged
as
collateral
and/
or
margin
deposit
to
cover
future
funding
obligations.
T.
ROWE
PRICE
Dynamic
Credit
Fund
1M
TSFR
One
month
term
SOFR
(Secured
overnight
financing
rate)
3M
EURIBOR
Three
month
EURIBOR
(Euro
interbank
offered
rate)
3M
TSFR
Three
month
term
SOFR
(Secured
overnight
financing
rate)
ADR
American
Depositary
Receipts
ARM
Adjustable
Rate
Mortgage
(ARM);
rate
shown
is
effective
rate
at
period-end.
The
rates
for
certain
ARMs
are
not
based
on
a
published
reference
rate
and
spread
but
may
be
determined
using
a
formula
based
on
the
rates
of
the
underlying
loans.
BRL
Brazilian
Real
BRL
CDI
One
day
Brazilian
interbank
deposit
rate
CHF
Swiss
Franc
CLO
Collateralized
Loan
Obligation
CMO
Collateralized
Mortgage
Obligation
CORRA
Canadian
Overnight
Repo
Rate
Average
CPI
Consumer
Price
Index
EUR
Euro
FRN
Floating
Rate
Note
GBP
British
Pound
GO
General
Obligation
HFA
Health
Facility
Authority
ILS
Israeli
Shekel
JPY
Japanese
Yen
MXIBTIIE
Mexican
Interbank
28
day
interest
rate
MXN
Mexican
Peso
OTC
Over-the-counter
PIK
Payment-in-kind
SOFR
Secured
overnight
financing
rate
SOFR30A
30-day
Average
SOFR
(Secured
overnight
financing
rate)
SONIA
Sterling
Overnight
Index
Average
STEP
Stepped
coupon
bond
for
which
the
coupon
rate
of
interest
adjusts
on
specified
date(s);
rate
shown
is
effective
rate
at
period-end.
TWD
Taiwan
Dollar
USD
U.S.
Dollar
VR
Variable
Rate;
rate
shown
is
effective
rate
at
period-end.
The
rates
for
certain
variable
rate
securities
are
not
based
on
a
published
reference
rate
and
spread
but
are
determined
by
the
issuer
or
agent
and
based
on
current
market
conditions.
ZAR
South
African
Rand
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Amounts
in
000s,
except
for
contracts)
OPTIONS
WRITTEN
(0.4)%
OTC
Options
Written (0.4)%
Counterparty
Description
Contracts
Notional
Amount
$
Value
Bank
of
America
USD
/
JPY
Call,
9/5/24
@
JPY160.00
1
137,750
(1,944)
Barclays
Bank
2
Year
Interest
Rate
Swap,
8/12/26
Pay
Fixed
4.20%
Annually,
Receive
Variable
5.33%
(SOFR)
Annually,
8/8/24
@
4.20%*
1
62,968
(394)
Barclays
Bank
2
Year
Interest
Rate
Swap,
8/13/26
Pay
Fixed
4.20%
Annually,
Receive
Variable
5.33%
(SOFR)
Annually,
8/9/24
@
4.20%*
1
111,577
(696)
Goldman
Sachs
2
Year
Interest
Rate
Swap,
8/13/26
Pay
Fixed
4.20%
Annually,
Receive
Variable
5.33%
(SOFR)
Annually,
8/9/24
@
4.20%*
1
54,930
(343)
Morgan
Stanley
2
Year
Interest
Rate
Swap,
8/12/26
Pay
Fixed
4.20%
Annually,
Receive
Variable
5.33%
(SOFR)
Annually,
8/8/24
@
4.20%*
1
57,333
(358)
Morgan
Stanley
2
Year
Interest
Rate
Swap,
8/13/26
Pay
Fixed
4.20%
Annually,
Receive
Variable
5.33%
(SOFR)
Annually,
8/9/24
@
4.20%*
1
111,577
(696)
Total
Options
Written
(Premiums
$(2,288))
$
(4,431)
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Amounts
in
000s)
SWAPS
(0.7)%
Description
Notional
Amount
$
Value
Upfront
Payments/
$
(Receipts)
**
Unrealized
$
Gain/(Loss)
BILATERAL
SWAPS
0.0%
Credit
Default
Swaps,
Protection
Sold
(0.1)%
Mexico
(0.1)%
Morgan
Stanley,
Protection
Sold (Relevant
Credit:
Petroleos
Mexicanos
,
B3*),
Receive
1.00%
Quarterly,
Pay
upon
credit
default,
12/20/28
(USD)
*
9,563
(1,300)
(1,810)
510
Total
Mexico
(1,810)
510
Total
Bilateral
Credit
Default
Swaps,
Protection
Sold
(1,810)
510
Total
Return
Swaps
0.1%
United
States
0.1%
JPMorgan
Chase,
Pay
Underlying
Reference:
Amazon.com
at
Maturity,
Receive
Variable
4.607%
(SOFR
+
(0.75)%)
at
Maturity,
9/20/24
*
3,529
159
—
159
JPMorgan
Chase,
Pay
Underlying
Reference:
Apple
at
Maturity,
Receive
Variable
4.607%
(SOFR
+
(0.75)%)
at
Maturity,
9/20/24
*
19,423
501
(112)
613
JPMorgan
Chase,
Pay
Underlying
Reference:
Halliburton
at
Maturity,
Receive
Variable
4.607%
(SOFR
+
(0.75)%)
at
Maturity,
9/20/24
*
6,063
231
—
231
Total
United
States
(112)
1,003
Total
Bilateral
Total
Return
Swaps
(112)
1,003
Interest
Rate
Swaps
0.0%
Brazil
0.0%
Morgan
Stanley,
9
Year
Interest
Rate
Swap,
Pay
Fixed
11.590%
at
Maturity,
Receive
Variable
10.40%,
(BRL
CDI)
at
Maturity,
1/3/33
96,830
336
—
336
Morgan
Stanley,
9
Year
Interest
Rate
Swap,
Pay
Fixed
11.615%
at
Maturity,
Receive
Variable
10.40%,
(BRL
CDI)
at
Maturity,
1/3/33
23,693
79
—
79
Total
Brazil
—
415
Total
Bilateral
Interest
Rate
Swaps
—
415
Total
Bilateral
Swaps
(1,922)
1,928
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Amounts
in
000s)
Description
Notional
Amount
$
Value
Initial
$
Value
**
Unrealized
$
Gain/(Loss)
CENTRALLY
CLEARED
SWAPS
(0.7)%
Credit
Default
Swaps,
Protection
Bought
(0.5)%
Canada
(0.0)%
Protection
Bought
(Relevant
Credit:
Bombardier),
Pay
5.00%
Quarterly,
Receive
upon
credit
default,
6/20/28
(USD)
1,515
(192)
(58)
(134)
Total
Canada
(134)
France
0.0%
Protection
Bought
(Relevant
Credit:
Societe
Generale
),
Pay
1.00%
Quarterly,
Receive
upon
credit
default,
6/20/29
8,028
14
164
(150)
Total
France
(150)
Oman
(0.0)%
Protection
Bought
(Relevant
Credit:
Sultanate
of
Oman),
Pay
1.00%
Quarterly,
Receive
upon
credit
default,
12/20/28
(USD)
10,262
(42)
270
(312)
Total
Oman
(312)
Spain
0.1%
Protection
Bought
(Relevant
Credit:
Grifols
),
Pay
5.00%
Quarterly,
Receive
upon
credit
default,
6/20/29
22,085
1,192
1,778
(586)
Total
Spain
(586)
United
States
(0.6)%
Protection
Bought
(Relevant
Credit:
American
Axle
&
Manufacturing),
Pay
5.00%
Quarterly,
Receive
upon
credit
default,
6/20/29
17,728
(1,293)
(337)
(956)
Protection
Bought
(Relevant
Credit:
Beazer
Homes
USA),
Pay
5.00%
Quarterly,
Receive
upon
credit
default,
6/20/28
915
(106)
(85)
(21)
Protection
Bought
(Relevant
Credit:
Delta
Air
Lines),
Pay
5.00%
Quarterly,
Receive
upon
credit
default,
6/21/27
335
(39)
(6)
(33)
Protection
Bought
(Relevant
Credit:
Delta
Air
Lines),
Pay
5.00%
Quarterly,
Receive
upon
credit
default,
12/20/28
11,761
(1,743)
(1,581)
(162)
Protection
Bought
(Relevant
Credit:
Nova
Chemicals),
Pay
5.00%
Quarterly,
Receive
upon
credit
default,
12/20/28
13,114
(1,659)
(669)
(990)
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Amounts
in
000s)
Description
Notional
Amount
$
Value
Initial
$
Value**
Unrealized
$
Gain/(Loss)
Protection
Bought
(Relevant
Credit:
United
Airlines
Holdings),
Pay
5.00%
Quarterly,
Receive
upon
credit
default,
6/20/29
18,010
(1,146)
52
(1,198)
Total
United
States
(3,360)
Total
Centrally
Cleared
Credit
Default
Swaps,
Protection
Bought
(4,542)
Credit
Default
Swaps,
Protection
Sold
(0.0)%
Israel
(0.0)%
Protection
Sold
(Relevant
Credit:
Teva
Pharmaceutical
Industries,
Ba2*),
Receive
1.00%
Quarterly,
Pay
upon
credit
default,
12/20/28
(USD)
5,447
(12)
(517)
505
Total
Israel
505
Mexico
(0.1)%
Protection
Sold
(Relevant
Credit:
Petroleos
Mexicanos
,
B3*),
Receive
1.00%
Quarterly,
Pay
upon
credit
default,
12/20/28
(USD)
13,050
(1,773)
(2,217)
444
Total
Mexico
444
Spain
0.0%
Protection
Sold
(Relevant
Credit:
Cellnex
Telecom,
BBB-*),
Receive
5.00%
Quarterly,
Pay
upon
credit
default,
12/20/28
459
81
74
7
Total
Spain
7
United
States
0.1%
Protection
Sold
(Relevant
Credit:
FedEx,
Baa2*),
Receive
1.00%
Quarterly,
Pay
upon
credit
default,
6/21/27
240
5
3
2
Protection
Sold
(Relevant
Credit:
Markit
CDX.NA.HY-S42,
5
Year
Index),
Receive
5.00%
Quarterly,
Pay
upon
credit
default,
6/20/29
11,000
703
731
(28)
Protection
Sold
(Relevant
Credit:
Markit
CDX.NA.IG-S39,
5
Year
Index),
Receive
1.00%
Quarterly,
Pay
upon
credit
default,
12/20/27
814
16
5
11
Total
United
States
(15)
Total
Centrally
Cleared
Credit
Default
Swaps,
Protection
Sold
941
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Amounts
in
000s)
Description
Notional
Amount
$
Value
Initial
$
Value**
Unrealized
$
Gain/(Loss)
Interest
Rate
Swaps
(0.1)%
Canada
(0.1)%
5
Year
Interest
Rate
Swap,
Receive
Fixed
3.274%
Semi-Annually,
Pay
Variable
4.780%
(CORRA)
Semi-
Annually,
6/14/29
146,480
(843)
—
(843)
5
Year
Interest
Rate
Swap,
Receive
Fixed
3.297%
Semi-Annually,
Pay
Variable
4.780%
(CORRA)
Semi-
Annually,
6/14/29
146,480
(731)
—
(731)
30
Year
Interest
Rate
Swap,
Pay
Fixed
3.236%
Semi-Annually,
Receive
Variable
4.780%
(CORRA)
Semi-Annually,
6/15/54
35,418
646
—
646
30
Year
Interest
Rate
Swap,
Pay
Fixed
3.257%
Semi-Annually,
Receive
Variable
4.780%
(CORRA)
Semi-Annually,
6/15/54
35,418
543
—
543
Total
Canada
(385)
Mexico
0.0%
20
Year
Interest
Rate
Swap,
Pay
Fixed
8.425%
28
Days,
Receive
Variable
11.245%
(MXIBTIIE)
28
Days,
4/15/43
17,475
90
—
90
Total
Mexico
90
United
States
(0.0)%
30
Year
Interest
Rate
Swap,
Pay
Fixed
3.882%
Annually,
Receive
Variable
5.406%
(SOFR)
Annually,
11/24/53
4,574
(59)
—
(59)
Total
United
States
(59)
Total
Centrally
Cleared
Interest
Rate
Swaps
(354)
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Amounts
in
000s)
Description
Notional
Amount
$
Value
Initial
$
Value**
Unrealized
$
Gain/(Loss)
Zero-Coupon
Inflation
Swaps
(0.1)%
United
States
(0.1)%
10
Year
Zero-Coupon
Inflation
Swap
Pay
Fixed
2.607%
at
Maturity,
Receive
Variable
(Change
in
CPI)
at
Maturity,
5/31/34
94,500
(517)
—
(517)
Total
United
States
(517)
Total
Centrally
Cleared
Zero-Coupon
Inflation
Swaps
(517)
Total
Centrally
Cleared
Swaps
(4,472)
Net
payments
(receipts)
of
variation
margin
to
date
4,723
Variation
margin
receivable
(payable)
on
centrally
cleared
swaps
$
251
*
Credit
ratings
as
of
June
30,
2024.
Ratings
shown
are
from
Moody’s
Investors
Service
and
if
Moody’s
does
not
rate
a
security,
then
Standard
&
Poor’s
(S&P)
is
used.
Fitch
is
used
for
securities
that
are
not
rated
by
either
Moody’s
or
S&P.
**
Includes
interest
purchased
or
sold
but
not
yet
collected
of
$(113).
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Amounts
in
000s)
FORWARD
CURRENCY
EXCHANGE
CONTRACTS
Counterparty
Settlement
Receive
Deliver
Unrealized
Gain/(Loss)
Bank
of
America
7/12/24
USD
1,168
MXN
19,464
$
107
Bank
of
America
7/12/24
ZAR
188,596
USD
10,276
79
Bank
of
America
7/19/24
JPY
1,797,275
USD
11,672
(465)
Bank
of
America
7/19/24
USD
27,262
JPY
4,156,440
1,343
Bank
of
America
8/16/24
EUR
8,445
USD
9,216
(150)
Bank
of
America
8/16/24
USD
9,196
CHF
8,240
(31)
Barclays
Bank
7/5/24
TWD
871,510
USD
27,088
(233)
Barclays
Bank
7/12/24
USD
8,903
MXN
157,215
329
Barclays
Bank
8/23/24
EUR
622
USD
678
(10)
Barclays
Bank
8/23/24
USD
1,035
GBP
814
6
BNY
Mellon
7/19/24
CHF
21,010
USD
23,366
80
BNY
Mellon
8/23/24
USD
18,998
EUR
17,585
114
Canadian
Imperial
Bank
of
Commerce
7/12/24
USD
9,275
MXN
158,070
654
Citibank
7/12/24
USD
13,540
ZAR
248,468
(102)
Citibank
7/18/24
ILS
153,125
USD
41,193
(620)
Citibank
7/18/24
USD
54,797
ILS
205,360
382
Citibank
7/19/24
JPY
2,244,785
USD
14,607
(608)
Citibank
8/23/24
EUR
7,100
USD
7,736
(111)
Citibank
8/23/24
USD
4,802
EUR
4,414
62
Deutsche
Bank
7/12/24
ZAR
82,147
USD
4,433
77
Deutsche
Bank
8/16/24
USD
9,223
EUR
8,445
157
Goldman
Sachs
7/5/24
USD
17,763
TWD
562,135
441
Goldman
Sachs
7/19/24
JPY
1,230,540
USD
7,946
(273)
Goldman
Sachs
8/23/24
USD
11,126
EUR
10,175
199
HSBC
Bank
7/12/24
MXN
838
USD
45
—
HSBC
Bank
7/19/24
JPY
4,156,440
USD
26,817
(898)
HSBC
Bank
7/19/24
USD
19,384
JPY
3,098,890
59
HSBC
Bank
8/23/24
EUR
3,124
USD
3,399
(44)
JPMorgan
Chase
7/19/24
JPY
1,816,535
USD
11,948
(620)
Morgan
Stanley
7/5/24
USD
9,687
TWD
309,290
156
Morgan
Stanley
7/12/24
USD
16,157
ZAR
295,905
(90)
Morgan
Stanley
8/23/24
USD
5,852
GBP
4,600
34
RBC
Dominion
Securities
7/12/24
MXN
315,080
USD
18,340
(1,156)
RBC
Dominion
Securities
8/23/24
GBP
175
USD
223
(1)
Standard
Chartered
7/19/24
JPY
1,229,330
USD
7,995
(329)
State
Street
7/19/24
USD
27,499
JPY
4,150,914
1,614
State
Street
8/23/24
EUR
1,115
USD
1,213
(16)
UBS
Investment
Bank
7/19/24
USD
23,146
CHF
21,010
(300)
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Amounts
in
000s)
FORWARD
CURRENCY
EXCHANGE
CONTRACTS
(CONTINUED)
Counterparty
Settlement
Receive
Deliver
Unrealized
Gain/(Loss)
UBS
Investment
Bank
7/19/24
USD
27,564
JPY
4,167,551
$
1,575
UBS
Investment
Bank
8/16/24
CHF
8,240
USD
9,279
(51)
UBS
Investment
Bank
8/23/24
EUR
1,095
USD
1,195
(19)
UBS
Investment
Bank
8/23/24
USD
27,640
EUR
25,327
442
Wells
Fargo
7/18/24
ILS
52,240
USD
14,045
(203)
Wells
Fargo
9/4/24
USD
27,577
BRL
144,580
1,911
Net
unrealized
gain
(loss)
on
open
forward
currency
exchange
contracts
$
3,491
T.
ROWE
PRICE
Dynamic
Credit
Fund
FUTURES
CONTRACTS
($000s)
Expiration
Date
Notional
Amount
Value
and
Unrealized
Gain
(Loss)
Short,
80
DAX
Performance
Index
contracts
9/24
(39,418)
$
(286)
Short,
369
Euro
BTP
contracts
9/24
(45,561)
506
Short,
351
Euro
OAT
contracts
9/24
(46,281)
256
Short,
74
Government
of
Japan
ten
year
bond
contracts
9/24
(65,707)
41
Long,
207
U.S.
Treasury
Notes
ten
year
contracts
9/24
22,767
200
Net
payments
(receipts)
of
variation
margin
to
date
(855)
Variation
margin
receivable
(payable)
on
open
futures
contracts
$
(138)
T.
ROWE
PRICE
Dynamic
Credit
Fund
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
AFFILIATED
COMPANIES
($000s)
The
fund
may
invest
in
certain
securities
that
are
considered
affiliated
companies.
As
defined
by
the
1940
Act,
an
affiliated
company
is
one
in
which
the
fund
owns
5%
or
more
of
the
outstanding
voting
securities,
or
a
company
that
is
under
common
ownership
or
control.
The
following
securities
were
considered
affiliated
companies
for
all
or
some
portion
of
the
six
months
ended
June
30,
2024.
Net
realized
gain
(loss),
investment
income,
change
in
net
unrealized
gain/loss,
and
purchase
and
sales
cost
reflect
all
activity
for
the
period
then
ended.
Affiliate
Net
Realized
Gain
(Loss)
Change
in
Net
Unrealized
Gain/Loss
Investment
Income
T.
Rowe
Price
Government
Reserve
Fund,
5.38%
$
—
$
—
$
873++
Totals
$
—#
$
—
$
873+
Supplementary
Investment
Schedule
Affiliate
Value
12/31/23
Purchase
Cost
Sales
Cost
Value
06/30/24
T.
Rowe
Price
Government
Reserve
Fund,
5.38%
$
100,498
¤
¤
$
30,067
Total
$
30,067^
#
Capital
gain
distributions
from
underlying
Price
funds
represented
$0
of
the
net
realized
gain
(loss).
++
Excludes
earnings
on
securities
lending
collateral,
which
are
subject
to
rebates
and
fees
as
described
in
Note
4
.
+
Investment
income
comprised
$873
of
dividend
income
and
$0
of
interest
income.
¤
Purchase
and
sale
information
not
shown
for
cash
management
funds.
^
The
cost
basis
of
investments
in
affiliated
companies
was
$30,067.
T.
ROWE
PRICE
Dynamic
Credit
Fund
June
30,
2024
(Unaudited)
Statement
of
Assets
and
Liabilities
($000s,
except
shares
and
per
share
amounts)
Assets
Investments
in
securities,
at
value
(cost
$966,952)
$
976,829
Interest
and
dividends
receivable
11,776
Unrealized
gain
on
forward
currency
exchange
contracts
9,821
Cash
5,058
Foreign
currency
(cost
$4,914)
4,915
Unrealized
gain
on
bilateral
swaps
1,928
Due
from
affiliates
406
Receivable
for
investment
securities
sold
331
Variation
margin
receivable
on
centrally
cleared
swaps
251
Receivable
for
shares
sold
109
Other
assets
590
Total
assets
1,012,014
Liabilities
Obligation
to
return
securities
lending
collateral
11,231
Payable
for
investment
securities
purchased
10,150
Unrealized
loss
on
forward
currency
exchange
contracts
6,330
Options
written
(premiums
$2,288)
4,431
Bilateral
swap
premiums
received
1,922
Investment
management
fees
payable
398
Payable
for
shares
redeemed
395
Variation
margin
payable
on
futures
contracts
138
Payable
to
directors
1
Other
liabilities
96
Total
liabilities
35,092
Commitments
and
Contingent
Liabilities
(note
6
)
NET
ASSETS
$
976,922
T.
ROWE
PRICE
Dynamic
Credit
Fund
June
30,
2024
(Unaudited)
Statement
of
Assets
and
Liabilities
($000s,
except
shares
and
per
share
amounts)
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Net
Assets
Consist
of:
Total
distributable
earnings
(loss)
$
(12,023)
Paid-in
capital
applicable
to
110,915,991
shares
of
$0.01
par
value
capital
stock
outstanding;
18,000,000,000
shares
of
the
Corporation
authorized
988,945
NET
ASSETS
$
976,922
NET
ASSET
VALUE
PER
SHARE
Investor
Class
(Net
assets:
$19,267;
Shares
outstanding:
2,185,577)
$
8.82
I
Class
(Net
assets:
$31,352;
Shares
outstanding:
3,559,046)
$
8.81
Z
Class
(Net
assets:
$926,303;
Shares
outstanding:
105,171,368)
$
8.81
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Unaudited)
6
Months
Ended
6/30/24
Investment
Income
(Loss)
Income
.
Interest
$
36,196
Dividend
1,126
Securities
lending
80
Total
income
37,402
Expenses
Investment
management
2,315
Shareholder
servicing
Investor
Class
$
25
I
Class
4
29
Prospectus
and
shareholder
reports
Investor
Class
1
Z
Class
4
5
Custody
and
accounting
135
Legal
and
audit
26
Registration
21
Directors
2
Miscellaneous
23
Waived
/
paid
by
Price
Associates
(2,401)
Total
expenses
155
Net
investment
income
37,247
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Unaudited)
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
6
Months
Ended
6/30/24
Realized
and
Unrealized
Gain
/
Loss
–
Net
realized
gain
(loss)
Securities
13,266
Futures
(45)
Swaps
(6,447)
Options
written
2,633
Forward
currency
exchange
contracts
(8,390)
Foreign
currency
transactions
(52)
Net
realized
gain
965
Change
in
net
unrealized
gain
/
loss
Securities
(15,013)
Futures
4,492
Swaps
648
Options
written
(2,919)
Forward
currency
exchange
contracts
5,957
Other
assets
and
liabilities
denominated
in
foreign
currencies
223
Change
in
net
unrealized
gain
/
loss
(6,612)
Net
realized
and
unrealized
gain
/
loss
(5,647)
INCREASE
IN
NET
ASSETS
FROM
OPERATIONS
$
31,600
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Unaudited)
Statement
of
Changes
in
Net
Assets
6
Months
Ended
6/30/24
Year
Ended
12/31/23
Increase
(Decrease)
in
Net
Assets
Operations
Net
investment
income
$
37,247
$
14,716
Net
realized
gain
(loss)
965
(24,885)
Change
in
net
unrealized
gain
/
loss
(6,612)
17,698
Increase
in
net
assets
from
operations
31,600
7,529
Distributions
to
shareholders
Net
earnings
Investor
Class
(611)
(1,834)
I
Class
(1,035)
(656)
Z
Class
(32,474)
(11,355)
Decrease
in
net
assets
from
distributions
(34,120)
(13,845)
Capital
share
transactions
*
Shares
sold
Investor
Class
6,700
20,122
I
Class
7,189
29,431
Z
Class
84,219
859,238
Distributions
reinvested
Investor
Class
596
701
I
Class
1,023
648
Z
Class
32,327
11,501
Shares
redeemed
Investor
Class
(6,132)
(31,503)
I
Class
(6,161)
(6,083)
Z
Class
(49,199)
(4,221)
Increase
in
net
assets
from
capital
share
transactions
70,562
879,834
T.
ROWE
PRICE
Dynamic
Credit
Fund
(Unaudited)
Statement
of
Changes
in
Net
Assets
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
6
Months
Ended
6/30/24
Year
Ended
12/31/23
Net
Assets
Increase
during
period
68,042
873,518
Beginning
of
period
908,880
35,362
End
of
period
$
976,922
$
908,880
*Share
information
(000s)
Shares
sold
Investor
Class
759
2,270
I
Class
814
3,314
Z
Class
9,511
96,750
Distributions
reinvested
Investor
Class
68
79
I
Class
116
73
Z
Class
3,668
1,303
Shares
redeemed
Investor
Class
(695)
(3,590)
I
Class
(699)
(685)
Z
Class
(5,579)
(482)
Increase
in
shares
outstanding
7,963
99,032
T.
ROWE
PRICE
Dynamic
Credit
Fund
Unaudited
NOTES
TO
FINANCIAL
STATEMENTS
T.
Rowe
Price
International
Funds,
Inc. (the
corporation) is
registered
under
the
Investment
Company
Act
of
1940
(the
1940
Act).
The
Dynamic
Credit
Fund
(the
fund)
is a
diversified, open-end
management
investment
company
established
by
the
corporation. The
fund
seeks
total
return
through
a
combination
of
income
and
capital
appreciation.
The
fund
has three classes
of
shares:
the
Dynamic
Credit
Fund
(Investor
Class),
the
Dynamic
Credit
Fund–I
Class
(I
Class)
and
the
Dynamic
Credit
Fund–Class
Z
(Class
Z).
I
Class
shares
require
a
$500,000
initial
investment
minimum,
although
the
minimum
generally
is
waived
or
reduced
for
financial
intermediaries,
eligible
retirement
plans,
and
certain
other
accounts.
The
Z
Class
is
only
available
to
funds
advised
by
T.
Rowe
Price
Associates,
Inc.
and
its
affiliates
and
other
clients
that
are
subject
to
a
contractual
fee
for
investment
management
services. Each
class
has
exclusive
voting
rights
on
matters
related
solely
to
that
class;
separate
voting
rights
on
matters
that
relate
to
all
classes;
and,
in
all
other
respects,
the
same
rights
and
obligations
as
the
other
classes.
NOTE
1
-
SIGNIFICANT
ACCOUNTING
POLICIES
Basis
of
Preparation
The fund
is
an
investment
company
and
follows
accounting
and
reporting
guidance
in
the
Financial
Accounting
Standards
Board
(FASB)
Accounting
Standards
Codification
Topic
946
(ASC
946).
The
accompanying
financial
statements
were
prepared
in
accordance
with
accounting
principles
generally
accepted
in
the
United
States
of
America
(GAAP),
including,
but
not
limited
to,
ASC
946.
GAAP
requires
the
use
of
estimates
made
by
management.
Management
believes
that
estimates
and
valuations
are
appropriate;
however,
actual
results
may
differ
from
those
estimates,
and
the
valuations
reflected
in
the
accompanying
financial
statements
may
differ
from
the
value
ultimately
realized
upon
sale
or
maturity.
Investment
Transactions,
Investment
Income,
and
Distributions
Investment
transactions
are
accounted
for
on
the
trade
date
basis.
Income
and
expenses
are
recorded
on
the
accrual
basis.
Realized
gains
and
losses
are
reported
on
the
identified
cost
basis. Premiums
and
discounts
on
debt
securities
are
amortized
for
financial
reporting
purposes. Paydown
gains
and
losses
are
recorded
as
an
adjustment
to
interest
income. Income
tax-related
interest
and
penalties,
if
incurred,
are
recorded
as
income
tax
expense. Dividends
received
from other
investment
companies are
reflected
as
dividend income;
capital
gain
distributions
are
reflected
as
realized
gain/loss. Dividend
income and
T.
ROWE
PRICE
Dynamic
Credit
Fund
capital
gain
distributions
are
recorded
on
the
ex-dividend
date. Earnings
on
investments
recognized
as
partnerships
for
federal
income
tax
purposes
reflect
the
tax
character
of
such
earnings. Non-cash
dividends,
if
any,
are
recorded
at
the
fair
market
value
of
the
asset
received. Proceeds
from
litigation
payments,
if
any,
are
included
in
either
net
realized
gain
(loss)
or
change
in
net
unrealized
gain/loss
from
securities. Distributions
to
shareholders
are
recorded
on
the
ex-dividend
date. Income
distributions,
if
any, are
declared
by
each
class daily
and
paid
monthly. A
capital
gain
distribution,
if
any, may
also
be
declared
and
paid
by
the
fund
annually.
Currency
Translation
Assets,
including
investments,
and
liabilities
denominated
in
foreign
currencies
are
translated
into
U.S.
dollar
values
each
day
at
the
prevailing
exchange
rate,
using
the
mean
of
the
bid
and
asked
prices
of
such
currencies
against
U.S.
dollars
as
provided
by
an
outside
pricing
service.
Purchases
and
sales
of
securities,
income,
and
expenses
are
translated
into
U.S.
dollars
at
the
prevailing
exchange
rate
on
the
respective
date
of
such
transaction.
The
effect
of
changes
in
foreign
currency
exchange
rates
on
realized
and
unrealized
security
gains
and
losses
is
not
bifurcated
from
the
portion
attributable
to
changes
in
market
prices.
Class
Accounting
Shareholder
servicing,
prospectus,
and
shareholder
report
expenses
incurred
by
each
class
are
charged
directly
to
the
class
to
which
they
relate.
Expenses
common
to
all
classes
and
investment
income
are
allocated
to
the
classes
based
upon
the
relative
daily
net
assets
of
each
class’s
settled
shares;
realized
and
unrealized
gains
and
losses
are
allocated
based
upon
the
relative
daily
net
assets
of
each
class’s
outstanding
shares.
Capital
Transactions
Each
investor’s
interest
in
the
net
assets
of the
fund
is
represented
by
fund
shares. The
fund’s
net
asset
value
(NAV)
per
share
is
computed
at
the
close
of
the
New
York
Stock
Exchange
(NYSE),
normally
4
p.m.
ET,
each
day
the
NYSE
is
open
for
business.
However,
the
NAV
per
share
may
be
calculated
at
a
time
other
than
the
normal
close
of
the
NYSE
if
trading
on
the
NYSE
is
restricted,
if
the
NYSE
closes
earlier,
or
as
may
be
permitted
by
the
SEC.
Purchases
and
redemptions
of
fund
shares
are
transacted
at
the
next-computed
NAV
per
share,
after
receipt
of
the
transaction
order
by
T.
Rowe
Price
Associates,
Inc.,
or
its
agents.
Indemnification
In
the
normal
course
of
business, the
fund
may
provide
indemnification
in
connection
with
its
officers
and
directors,
service
providers,
and/or
private
company
investments. The
fund’s
maximum
exposure
under
these
arrangements
is
unknown;
however,
the
risk
of
material
loss
is
currently
considered
to
be
remote.
T.
ROWE
PRICE
Dynamic
Credit
Fund
NOTE
2
-
VALUATION
Fair
Value
The
fund’s
financial
instruments
are
valued
at
the
close
of
the
NYSE
and
are
reported
at
fair
value,
which
GAAP
defines
as
the
price
that
would
be
received
to
sell
an
asset
or
paid
to
transfer
a
liability
in
an
orderly
transaction
between
market
participants
at
the
measurement
date. The fund’s
Board
of
Directors
(the
Board)
has
designated
T.
Rowe
Price
Associates,
Inc.
as
the
fund’s
valuation
designee
(Valuation
Designee).
Subject
to
oversight
by
the
Board,
the
Valuation
Designee
performs
the
following
functions
in
performing
fair
value
determinations:
assesses
and
manages
valuation
risks;
establishes
and
applies
fair
value
methodologies;
tests
fair
value
methodologies;
and
evaluates
pricing
vendors
and
pricing
agents.
The
duties
and
responsibilities
of
the
Valuation
Designee
are
performed
by
its
Valuation
Committee. The
Valuation
Designee provides
periodic
reporting
to
the
Board
on
valuation
matters.
Various
valuation
techniques
and
inputs
are
used
to
determine
the
fair
value
of
financial
instruments.
GAAP
establishes
the
following
fair
value
hierarchy
that
categorizes
the
inputs
used
to
measure
fair
value:
Level
1
–
quoted
prices
(unadjusted)
in
active
markets
for
identical
financial
instruments
that
the
fund
can
access
at
the
reporting
date
Level
2
–
inputs
other
than
Level
1
quoted
prices
that
are
observable,
either
directly
or
indirectly
(including,
but
not
limited
to,
quoted
prices
for
similar
financial
instruments
in
active
markets,
quoted
prices
for
identical
or
similar
financial
instruments
in
inactive
markets,
interest
rates
and
yield
curves,
implied
volatilities,
and
credit
spreads)
Level
3
–
unobservable
inputs
(including
the Valuation
Designee’s assumptions
in
determining
fair
value)
Observable
inputs
are
developed
using
market
data,
such
as
publicly
available
information
about
actual
events
or
transactions,
and
reflect
the
assumptions
that
market
participants
would
use
to
price
the
financial
instrument.
Unobservable
inputs
are
those
for
which
market
data
are
not
available
and
are
developed
using
the
best
information
available
about
the
assumptions
that
market
participants
would
use
to
price
the
financial
instrument.
GAAP
requires
valuation
techniques
to
maximize
the
use
of
relevant
observable
inputs
and
minimize
the
use
of
unobservable
inputs.
When
multiple
inputs
are
used
to
derive
fair
value,
the
financial
instrument
is
assigned
to
the
level
within
the
fair
value
hierarchy
based
on
the
lowest-level
input
that
is
significant
to
the
fair
value
of
the
financial
T.
ROWE
PRICE
Dynamic
Credit
Fund
instrument.
Input
levels
are
not
necessarily
an
indication
of
the
risk
or
liquidity
associated
with
financial
instruments
at
that
level
but
rather
the
degree
of
judgment
used
in
determining
those
values.
Valuation
Techniques
Debt
securities
generally
are
traded
in
the over-the-
counter
(OTC)
market
and
are
valued
at
prices
furnished
by
independent
pricing
services
or
by
broker
dealers
who
make
markets
in
such
securities.
When
valuing
securities,
the
independent
pricing
services
consider
factors
such
as,
but
not
limited
to,
the
yield
or
price
of
bonds
of
comparable
quality,
coupon,
maturity,
and
type,
as
well
as
prices
quoted
by
dealers
who
make
markets
in
such
securities.
Equity
securities,
including
exchange-traded
funds, listed
or
regularly
traded
on
a
securities
exchange
or
in
the
over-the-counter
(OTC)
market
are
valued
at
the
last
quoted
sale
price
or,
for
certain
markets,
the
official
closing
price
at
the
time
the
valuations
are
made.
OTC
Bulletin
Board
securities
are
valued
at
the
mean
of
the
closing
bid
and
asked
prices.
A
security
that
is
listed
or
traded
on
more
than
one
exchange
is
valued
at
the
quotation
on
the
exchange
determined
to
be
the
primary
market
for
such
security.
Listed
securities
not
traded
on
a
particular
day
are
valued
at
the
mean
of
the
closing
bid
and
asked
prices
for
domestic
securities.
Investments
in
mutual
funds
are
valued
at
the
mutual
fund’s
closing
NAV
per
share
on
the
day
of
valuation.
Investments
in
private
investment
companies
are
valued
at
the
investee’s
NAV
per
share
as
of
the
valuation
date,
if
available.
If
the
investee’s
NAV
is
not
available
as
of
the
valuation
date
or
is
not
calculated
in
accordance
with
GAAP,
the
Valuation Designee
may
adjust
the
investee’s
NAV
to
reflect
fair
value
at
the
valuation
date.
Listed
options,
and
OTC
options
with
a
listed
equivalent,
are
valued
at
the
mean
of
the
closing
bid
and
asked
prices
and
exchange-traded
options
on
futures
contracts
are
valued
at
closing
settlement
prices.
Futures
contracts
are
valued
at
closing
settlement
prices.
Forward
currency
exchange
contracts
are
valued
using
the
prevailing
forward
exchange
rate.
Swaps
are
valued
at
prices
furnished
by
an
independent
pricing
service
or
independent
swap
dealers.
Assets
and
liabilities
other
than
financial
instruments,
including
short-term
receivables
and
payables,
are
carried
at
cost,
or
estimated
realizable
value,
if
less,
which
approximates
fair
value.
Investments
for
which
market
quotations are
not
readily
available
or
deemed
unreliable
are
valued
at
fair
value
as
determined
in
good
faith
by
the
Valuation
Designee.
The
Valuation
Designee
has
adopted
methodologies
for
determining
the
fair
value
of
investments
for
which
market
quotations
are
not
readily
available
or
deemed
unreliable,
including
the
use
of
other
pricing
T.
ROWE
PRICE
Dynamic
Credit
Fund
sources.
Factors
used
in
determining
fair
value
vary
by
type
of
investment
and
may
include
market
or
investment
specific
considerations.
The
Valuation
Designee typically
will
afford
greatest
weight
to
actual
prices
in
arm’s
length
transactions,
to
the
extent
they
represent
orderly
transactions
between
market
participants,
transaction
information
can
be
reliably
obtained,
and
prices
are
deemed
representative
of
fair
value.
However,
the
Valuation
Designee may
also
consider
other
valuation
methods
such
as
market-based
valuation
multiples;
a
discount
or
premium
from
market
value
of
a
similar,
freely
traded
security
of
the
same
issuer;
discounted
cash
flows;
yield
to
maturity;
or
some
combination.
Fair
value
determinations
are
reviewed
on
a
regular
basis.
Because
any
fair
value
determination
involves
a
significant
amount
of
judgment,
there
is
a
degree
of
subjectivity
inherent
in
such
pricing
decisions. Fair
value
prices
determined
by
the
Valuation
Designee could
differ
from
those
of
other
market
participants,
and
it
is
possible
that
the
fair
value
determined
for
a
security
may
be
materially
different
from
the
value
that
could
be
realized
upon
the
sale
of
that
security.
T.
ROWE
PRICE
Dynamic
Credit
Fund
Valuation
Inputs
The
following
table
summarizes
the
fund’s
financial
instruments,
based
on
the
inputs
used
to
determine
their
fair
values
on
June
30,
2024
(for
further
detail
by
category,
please
refer
to
the
accompanying
Portfolio
of
Investments):
($000s)
Level
1
Level
2
Level
3
Total
Value
Assets
Fixed
Income
Securities
1
$
—
$
282,046
$
—
$
282,046
Bank
Loans
—
137,076
6,217
143,293
Common
Stocks
41,786
—
18
41,804
Convertible
Bonds
—
54,527
3,705
58,232
Corporate
Bonds
—
334,391
13,663
348,054
Private
Investment
Company
2
—
—
—
32
Short-Term
Investments
18,836
67,508
—
86,344
Securities
Lending
Collateral
11,231
—
—
11,231
Options
Purchased
—
5,793
—
5,793
Total
Securities
71,853
881,341
23,603
976,829
Swaps*
—
3,554
—
3,554
Forward
Currency
Exchange
Contracts
—
9,821
—
9,821
Futures
Contracts*
1,003
—
—
1,003
Total
$
72,856
$
894,716
$
23,603
$
991,207
Liabilities
Options
Written
$
—
$
4,431
$
—
$
4,431
Swaps*
—
8,020
—
8,020
Forward
Currency
Exchange
Contracts
—
6,330
—
6,330
Futures
Contracts*
286
—
—
286
Total
$
286
$
18,781
$
—
$
19,067
1
Includes
Asset-Backed
Securities,
Government
Bonds,
Municipal
Securities
and
Non-
U.S.
Government
Mortgage-Backed
Securities.
T.
ROWE
PRICE
Dynamic
Credit
Fund
Following
is
a
reconciliation
of
the
fund’s
Level
3
holdings
for
the
six
months ended
June
30,
2024.
Gain
(loss)
reflects
both
realized
and
change
in
unrealized
gain/loss
on
Level
3
holdings
during
the
period,
if
any,
and
is
included
on
the
accompanying
Statement
of
Operations.
The
change
in
unrealized
gain/loss
on
Level
3
instruments
held
at
June
30,
2024,
totaled less
than
$1,000 for
the
six
months ended
June
30,
2024.
NOTE
3
-
DERIVATIVE
INSTRUMENTS
During
the
six
months ended
June
30,
2024,
the
fund
invested
in
derivative
instruments.
As
defined
by
GAAP,
a
derivative
is
a
financial
instrument
whose
value
is
derived
from
an
underlying
security
price,
foreign
exchange
rate,
interest
rate,
index
of
prices
or
rates,
or
other
variable;
it
requires
little
or
no
initial
investment
and
permits
or
requires
net
settlement.
The
fund
invests
in
derivatives
only
if
the
expected
risks
and
rewards
are
consistent
with
its
investment
objectives,
policies,
and
overall
risk
profile,
as
described
in
its
prospectus
and
Statement
of
Additional
Information.
The
fund
may
use
derivatives
for
a
variety
of
purposes
and
may
use
them
to
establish
both
long
and
short
positions
within
the
fund’s
portfolio.
Potential
uses
include
to
hedge
2
In
accordance
with
Subtopic
820-10,
certain
investments
that
are
measured
at
fair
value
using
the
net
asset
value
per
share
(or
its
equivalent)
practical
expedient
have
not
been
classified
in
the
fair
value
hierarchy.
The
fair
value
amounts
presented
in
this
table
are
intended
to
permit
reconciliation
of
the
fair
value
hierarchy
to
the
amounts
presented
in
the
Portfolio
of
Investments.
*
The
fair
value
presented
includes
cumulative
gain
(loss)
on
open
futures
contracts
and
centrally
cleared
swaps;
however,
the
net
value
reflected
on
the
accompanying
Portfolio
of
Investments
is
only
the
unsettled
variation
margin
receivable
(payable)
at
that
date.
($000s)
Beginning
Balance
12/31/23
Gain
(Loss)
During
Period
Total
Purchases
Ending
Balance
6/30/24
Investment
in
Securities
Bank
Loans
$
—
$
—
$
6,217
$
6,217
Common
Stocks
16
2
—
18
Convertible
Bonds
—
—
3,705
3,705
Corporate
Bonds
—
118
13,545
13,663
Total
$
16
$
120
$
23,467
$
23,603
T.
ROWE
PRICE
Dynamic
Credit
Fund
against
declines
in
principal
value,
increase
yield,
invest
in
an
asset
with
greater
efficiency
and
at
a
lower
cost
than
is
possible
through
direct
investment,
to
enhance
return,
or
to
adjust
portfolio
duration
and
credit
exposure.
The
risks
associated
with
the
use
of
derivatives
are
different
from,
and
potentially
much
greater
than,
the
risks
associated
with
investing
directly
in
the
instruments
on
which
the
derivatives
are
based.
The
fund
values
its
derivatives
at
fair
value
and
recognizes
changes
in
fair
value
currently
in
its
results
of
operations.
Accordingly,
the
fund
does
not
follow
hedge
accounting,
even
for
derivatives
employed
as
economic
hedges.
Generally,
the
fund
accounts
for
its
derivatives
on
a
gross
basis.
It
does
not
offset
the
fair
value
of
derivative
liabilities
against
the
fair
value
of
derivative
assets
on
its
financial
statements,
nor
does
it
offset
the
fair
value
of
derivative
instruments
against
the
right
to
reclaim
or
obligation
to
return
collateral.
The
following
table
summarizes
the
fair
value
of
the
fund’s
derivative
instruments
held
as
of
June
30,
2024,
and
the
related
location
on
the
accompanying
Statement
of
Assets
and
Liabilities,
presented
by
primary
underlying
risk
exposure:
T.
ROWE
PRICE
Dynamic
Credit
Fund
($000s)
Location
on
Statement
of
Assets
and
Liabilities
Fair
Value*
Assets
Interest
rate
derivatives
Bilateral
Swaps
and
Premiums,
Centrally
Cleared
Swaps,
Futures,
Securities^
$
4,532
Foreign
exchange
derivatives
Forwards,
Securities^
13,779
Credit
derivatives
Bilateral
Swaps
and
Premiums,
Centrally
Cleared
Swaps
1,860
^
,*
Total
$
20,171
^
,*
Liabilities
Inflation
derivatives
Centrally
Cleared
Swaps
$
517
Interest
rate
derivatives
Centrally
Cleared
Swaps,
Options
Written
4,120
Foreign
exchange
derivatives
Forwards,
Options
Written
8,274
Credit
derivatives
Bilateral
Swaps
and
Premiums,
Centrally
Cleared
Swaps
5,870
Equity
derivatives
Futures
286
Total
$
19,067
*
The
fair
value
presented
includes
cumulative
gain
(loss)
on
open
futures
contracts
and
centrally
cleared
swaps;
however,
the
value
reflected
on
the
accompanying
Statement
of
Assets
and
Liabilities
is
only
the
unsettled
variation
margin
receivable
(payable)
at
that
date.
^
Options
purchased
are
reported
as
securities
and
are
reflected
in
the
accompanying
Portfolio
of
Investments.
T.
ROWE
PRICE
Dynamic
Credit
Fund
Additionally,
the
amount
of
gains
and
losses
on
derivative
instruments
recognized
in
fund
earnings
during
the
six
months ended
June
30,
2024,
and
the
related
location
on
the
accompanying
Statement
of
Operations
is
summarized
in
the
following
table
by
primary
underlying
risk
exposure:
($000s)
Location
of
Gain
(Loss)
on
Statement
of
Operations
Securities^
Options
Written
Futures
Forward
Currency
Exchange
Contracts
Swaps
Total
Realized
Gain
(Loss)
Inflation
derivatives
$
—
$
—
$
—
$
—
$
1,243
$
1,243
Interest
rate
derivatives
3,438
—
(833)
—
(7,399)
(4,794)
Foreign
exchange
derivatives
(1,338)
—
—
(8,390)
—
(9,728)
Credit
derivatives
(2,481)
—
—
—
(291)
(2,772)
Equity
derivatives
(4,145)
2,633
788
—
—
(724)
Total
$
(4,526)
$
2,633
$
(45)
$
(8,390)
$
(6,447)
$
(16,775)
T.
ROWE
PRICE
Dynamic
Credit
Fund
Counterparty
Risk
and
Collateral
The
fund
invests
in
derivatives
in
various
markets,
which
expose
it
to
differing
levels
of
counterparty
risk.
Counterparty
risk
on
exchange-traded
and
centrally
cleared
derivative
contracts,
such
as
futures,
exchange-traded
options,
and
centrally
cleared
swaps,
is
minimal
because
the
clearinghouse
provides
protection
against
counterparty
defaults.
For
futures
and
centrally
cleared
swaps,
the
fund
is
required
to
deposit
collateral
in
an
amount
specified
by
the
clearinghouse
and
the
clearing
firm
(margin
requirement),
and
the
margin
requirement
must
be
maintained
over
the
life
of
the
contract.
Each
clearinghouse
and
clearing
firm,
in
its
sole
discretion,
may
adjust
the
margin
requirements
applicable
to
the
fund.
Derivatives,
such
as
non-cleared bilateral
swaps,
forward
currency
exchange
contracts,
and
OTC
options,
that
are
transacted
and
settle
directly
with
a
counterparty
(bilateral
derivatives)
may
expose
the
fund
to
greater
counterparty
risk.
To
mitigate
this
risk,
the
fund
has
entered
into
master
netting
arrangements
(MNAs)
with
certain
counterparties
that
permit
net
settlement
under
specified
conditions
and,
for
certain
counterparties,
also
require
the
exchange
of
collateral
($000s)
Location
of
Gain
(Loss)
on
Statement
of
Operations
Securities^
Options
Written
Futures
Forward
Currency
Exchange
Contracts
Swaps
Total
Change
in
Unrealized
Gain
(Loss)
Inflation
derivatives
$
—
$
—
$
—
$
—
$
262
$
262
Interest
rate
derivatives
(2,566)
(994)
4,653
—
766
1,859
Foreign
exchange
derivatives
3,778
(1,149)
—
5,957
—
8,586
Credit
derivatives
—
—
—
—
(380)
(380)
Equity
derivatives
1,539
(776)
(161)
—
—
602
Total
$
2,751
$
(2,919)
$
4,492
$
5,957
$
648
$
10,929
^
Options
purchased
are
reported
as
securities.
T.
ROWE
PRICE
Dynamic
Credit
Fund
to
cover
mark-to-market
exposure.
MNAs
may
be
in
the
form
of
International
Swaps
and
Derivatives
Association
master
agreements
(ISDAs)
or
foreign
exchange
letter
agreements
(FX
letters).
MNAs
provide
the
ability
to
offset
amounts
the
fund
owes
a
counterparty
against
amounts
the
counterparty
owes
the
fund
(net
settlement).
Both
ISDAs
and
FX
letters
generally
allow
termination
of
transactions
and
net
settlement
upon
the
occurrence
of
contractually
specified
events,
such
as
failure
to
pay
or
bankruptcy.
In
addition,
ISDAs
specify
other
events,
the
occurrence
of
which
would
allow
one
of
the
parties
to
terminate.
For
example,
a
downgrade
in
credit
rating
of
a
counterparty
below
a
specified
rating
would
allow
the
fund
to
terminate,
while
a
decline
in
the
fund’s
net
assets
of
more
than
a
specified
percentage
would
allow
the
counterparty
to
terminate.
Upon
termination,
all
transactions
with
that
counterparty
would
be
liquidated
and
a
net
termination
amount
settled.
ISDAs
typically
include
collateral
agreements
whereas
FX
letters
do
not.
Collateral
requirements
are
determined
daily
based
on
the
net
aggregate
unrealized
gain
or
loss
on
all
bilateral
derivatives
with
a
counterparty,
subject
to
minimum
transfer
amounts
that
typically
range
from
$100,000
to
$250,000.
Any
additional
collateral
required
due
to
changes
in
security
values
is
typically
transferred
the
next
business
day.
Collateral
may
be
in
the
form
of
cash
or
debt
securities
issued
by
the
U.S.
government
or
related
agencies,
although
other
securities
may
be
used
depending
on
the
terms
outlined
in
the
applicable
MNA.
Cash
posted
by
the
fund
is
reflected
as
cash
deposits
in
the
accompanying
financial
statements
and
generally
is
restricted
from
withdrawal
by
the
fund;
securities
posted
by
the
fund
are
so
noted
in
the
accompanying
Portfolio
of
Investments;
both
remain
in
the
fund’s
assets.
Collateral
pledged
by
counterparties
is
not
included
in
the
fund’s
assets
because
the
fund
does
not
obtain
effective
control
over
those
assets.
For
bilateral
derivatives,
collateral
posted
by
the
fund
is
held
in
a
segregated
account
at
the
fund’s
custodian.
While
typically
not
sold
in
the
same
manner
as
equity
or
fixed
income
securities,
exchange-traded
or
centrally
cleared
derivatives
may
be
closed
out
only
on
the
exchange
or
clearinghouse
where
the
contracts
were
cleared,
and
OTC
and
bilateral
derivatives
may
be
unwound
with
counterparties
or
transactions
assigned
to
other
counterparties
to
allow
the
fund
to
exit
the
transaction.
This
ability
is
subject
to
the
liquidity
of
underlying
positions. As
of
June
30,
2024,
securities
valued
at $28,073,000
had
been
posted
by
the
fund
for
exchange-traded
and/or
centrally
cleared
derivatives.
T.
ROWE
PRICE
Dynamic
Credit
Fund
The
following
table
summarizes
the
fund’s
OTC
and
bilateral
derivatives
at
the
reporting
date
by
loss
exposure
to
each
counterparty
after
consideration
of
collateral,
if
any.
Forward
Currency
Exchange
Contracts
The
fund
is
subject
to
foreign
currency
exchange
rate
risk
in
the
normal
course
of
pursuing
its
investment
objectives.
It may use
forward
currency
exchange
contracts
(forwards)
primarily
to
protect
its
non-U.S.
dollar-denominated
securities
from
adverse
currency
movements
or
to
increase
exposure
to
a
particular
foreign
currency,
to
shift
the
fund’s
foreign
currency
exposure
from
one
country
to
another,
or
to
enhance
the
fund’s
return.
A
forward
involves
an
obligation
to
purchase
or
sell
a
fixed
amount
of
a
specific
currency
on
a
future
date
at
a
price
set
at
the
time
of
the
contract.
Although
certain
forwards
may
be
settled
by
exchanging
only
the
net
($000s)
Gross
Value
on
Statements
of
Assets
and
Liabilities
Net
amount
due
(to)/from
Counterparty
or
Exchange
Collateral
Pledged
(Received)
by
Fund
Loss
Exposure,
After
Collateral*
(not
less
than
$0)
Counterparty
Assets
Liabilities
Bank
of
America
$
5,487
$
(2,590)
$
2,897
$
(2,592)
$
305
Barclays
Bank
1,805
(1,333)
472
—
472
BNY
Mellon
194
—
194
(350)
—
Canadian
Imperial
Bank
of
Commerce
654
—
654
(700)
—
Citibank
444
(1,441)
(997)
886
—
Deutsche
Bank
234
—
234
(260)
—
Goldman
Sachs
732
(616)
116
—
116
HSBC
Bank
59
(942)
(883)
896
13
JPMorgan
Chase
891
(620)
271
191
462
Morgan
Stanley
878
(2,444)
(1,566)
1,800
234
RBC
Dominion
Securities
—
(1,157)
(1,157)
1,100
—
Standard
Chartered
—
(329)
(329)
262
—
State
Street
1,614
(16)
1,598
(1,405)
193
UBS
Investment
Bank
2,017
(370)
1,647
(1,713)
—
Wells
Fargo
1,911
(203)
1,708
(1,440)
268
Total
$
16,920
$
(12,061)
*
In
situations
such
as
counterparty
default
or
bankruptcy,
the
fund
may
have
further
rights
of
offset
against
amounts
due
to
or
from
the
counterparty
under
other
agreements.
T.
ROWE
PRICE
Dynamic
Credit
Fund
gain
or
loss
on
the
contract,
most
forwards
are
settled
with
the
exchange
of
the
underlying
currencies
in
accordance
with
the
specified
terms.
Forwards
are
valued
at
the
unrealized
gain
or
loss
on
the
contract,
which
reflects
the
net
amount
the
fund
either
is
entitled
to
receive
or
obligated
to
deliver,
as
measured
by
the
difference
between
the
forward
exchange
rates
at
the
date
of
entry
into
the
contract
and
the
forward
rates
at
the
reporting
date.
Appreciated
forwards
are
reflected
as
assets
and
depreciated
forwards
are
reflected
as
liabilities
on
the
accompanying
Statement
of
Assets
and
Liabilities.
When
a
contract
is
closed,
a
realized
gain
or
loss
is
recorded
on
the
accompanying
Statement
of
Operations.
Risks
related
to
the
use
of
forwards
include
the
possible
failure
of
counterparties
to
meet
the
terms
of
the
agreements;
that
anticipated
currency
movements
will
not
occur,
thereby
reducing
the
fund’s
total
return;
and
the
potential
for
losses
in
excess
of
the
fund’s
initial
investment.
During
the
six
months ended
June
30,
2024,
the
volume
of
the
fund’s
activity
in
forwards,
based
on
underlying
notional
amounts,
was
generally
between
11%
and
19%
of
net
assets.
Futures
Contracts
The
fund
is
subject
to interest
rate
risk
and
equity
price
risk in
the
normal
course
of
pursuing
its
investment
objectives
and
uses
futures
contracts
to
help
manage
such
risks.
The fund
may
enter
into
futures
contracts
to
manage
exposure
to
interest
rate
and
yield
curve
movements,
security
prices,
foreign
currencies,
credit
quality,
and
mortgage
prepayments;
as
an
efficient
means
of
adjusting
exposure
to
all
or
part
of
a
target
market;
to
enhance
income;
as
a
cash
management
tool;
or
to
adjust
portfolio
duration
and
credit
exposure. A
futures
contract
provides
for
the
future
sale
by
one
party
and
purchase
by
another
of
a
specified
amount
of
a
specific
underlying
financial
instrument
at
an
agreed-upon
price,
date,
time,
and
place.
The
fund
currently
invests
only
in
exchange-traded
futures,
which
generally
are
standardized
as
to
maturity
date,
underlying
financial
instrument,
and
other
contract
terms.
Payments
are
made
or
received
by
the
fund
each
day
to
settle
daily
fluctuations
in
the
value
of
the
contract
(variation
margin),
which
reflect
changes
in
the
value
of
the
underlying
financial
instrument.
Variation
margin
is
recorded
as
unrealized
gain
or
loss
until
the
contract
is
closed.
The
value
of
a
futures
contract
included
in
net
assets
is
the
amount
of
unsettled
variation
margin;
net
variation
margin
receivable
is
reflected
as
an
asset
and
net
variation
margin
payable
is
reflected
as
a
liability
on
the
accompanying
Statement
of
Assets
and
Liabilities.
When
a
contract
is
closed,
a
realized
gain
or
loss
is
recorded
on
the
accompanying
Statement
of
Operations.
Risks
related
to
the
use
of
futures
contracts
include
possible
illiquidity
of
the
futures
markets,
contract
prices
that
can
be
highly
volatile
and
imperfectly
correlated
to
movements
in
hedged
security
values
and/
T.
ROWE
PRICE
Dynamic
Credit
Fund
or
interest
rates,
and
potential
losses
in
excess
of
the
fund’s
initial
investment.
During
the
six
months ended
June
30,
2024,
the
volume
of
the
fund’s
activity
in
futures,
based
on
underlying
notional
amounts,
was
generally
between
18%
and
30%
of
net
assets.
Options
The
fund
is
subject
to interest
rate
risk,
foreign
currency
exchange
rate
risk,
credit
risk
and
equity
price
risk in
the
normal
course
of
pursuing
its
investment
objectives
and
uses
options
to
help
manage
such
risks.
The
fund
may
use
options
to
manage
exposure
to
security
prices,
interest
rates,
foreign
currencies,
and
credit
quality;
as
an
efficient
means
of
adjusting
exposure
to
all
or
a
part
of
a
target
market;
to
enhance
income;
as
a
cash
management
tool;
or
to
adjust
credit
exposure.
The
fund
may
buy
or
sell
options
that
can
be
settled
either
directly
with
the
counterparty
(OTC
option)
or
through
a
central
clearinghouse
(exchange-traded
option).
Options
are
included
in
net
assets
at
fair
value,
options
purchased
are
included
in
Investments
in
Securities,
and
options
written
are
separately
reflected
as
a
liability
on
the
accompanying
Statement
of
Assets
and
Liabilities.
Premiums
on
unexercised,
expired
options
are
recorded
as
realized
gains
or
losses
on
the
accompanying
Statement
of
Operations;
premiums
on
exercised
options
are
recorded
as
an
adjustment
to
the
proceeds
from
the
sale
or
cost
of
the
purchase.
The
difference
between
the
premium
and
the
amount
received
or
paid
in
a
closing
transaction
is
also
treated
as
realized
gain
or
loss
on
the
accompanying
Statement
of
Operations.
In
return
for
a
premium
paid,
currency
options
give
the
holder
the
right,
but
not
the
obligation,
to
buy
and
sell
currency
at
a
specified
exchange
rate;
although
certain
currency
options
may
be
settled
by
exchanging
only
the
net
gain
or
loss
on
the
contract.
In
return
for
a
premium
paid,
call
and
put
options
on
futures
give
the
holder
the
right,
but
not
the
obligation,
to
purchase
or
sell,
respectively,
a
position
in
a
particular
futures
contract
at
a
specified
exercise
price.
In
return
for
a
premium
paid,
call
and
put
index
options
give
the
holder
the
right,
but
not
the
obligation,
to
receive
cash
equal
to
the
difference
between
the
value
of
the
reference
index
on
the
exercise
date
and
the
exercise
price
of
the
option.
In
return
for
a
premium
paid,
options
on
swaps
give
the
holder
the
right,
but
not
the
obligation,
to
enter
a
specified
swap
contract
on
predefined
terms.
The
exercise
price
of
an
option
on
a
credit
default
swap
is
stated
in
terms
of
a
specified
spread
that
represents
the
cost
of
credit
protection
on
the
reference
asset,
including
both
the
upfront
premium
to
open
the
position
and
future
periodic
payments.
The
exercise
price
of
an
interest
rate
swap
is
stated
in
terms
of
a
fixed
interest
rate;
generally,
there
is
no
upfront
payment
to
open
the
position. Risks related
to
the
use
of
options
include
possible
illiquidity
of
the
options
markets;
trading
restrictions
imposed
by
an
exchange
or
counterparty;
T.
ROWE
PRICE
Dynamic
Credit
Fund
possible
failure
of
counterparties
to
meet
the
terms
of
the
agreements;
movements
in
the
underlying
asset
values,
interest
rates,
currency
values
and
credit
ratings;
and,
for
options
written,
the
potential
for
losses
to
exceed
any
premium
received
by
the
fund.
During
the
six
months ended
June
30,
2024,
the
volume
of
the
fund’s
activity
in
options,
based
on
underlying
notional
amounts,
was
generally
between
39%
and
159%
of
net
assets.
Swaps
The
fund
is
subject
to
interest
rate
risk,
credit
risk
and
inflation
risk in
the
normal
course
of
pursuing
its
investment
objectives
and
uses
swap
contracts
to
help
manage
such
risks.
The
fund
may
use
swaps
in
an
effort
to
manage
both
long
and
short
exposure
to
changes
in
interest
rates,
inflation
rates,
and
credit
quality;
to
adjust
overall
exposure
to
certain
markets;
to
enhance
total
return
or
protect
the
value
of
portfolio
securities;
to
serve
as
a
cash
management
tool;
or
to
adjust
portfolio
duration
and
credit
exposure.
Swap
agreements
can
be
settled
either
directly
with
the
counterparty
(bilateral
swap)
or
through
a
central
clearinghouse
(centrally
cleared
swap).
Fluctuations
in
the
fair
value
of
a
contract
are
reflected
in
unrealized
gain
or
loss
and
are
reclassified
to
realized
gain
or
loss
on
the
accompanying
Statement
of
Operations upon
contract
termination
or
cash
settlement.
Net
periodic
receipts
or
payments
required
by
a
contract
increase
or
decrease,
respectively,
the
value
of
the
contract
until
the
contractual
payment
date,
at
which
time
such
amounts
are
reclassified
from
unrealized
to
realized
gain
or
loss
on
the
accompanying
Statement
of
Operations.
For
bilateral
swaps,
cash
payments
are
made
or
received
by
the
fund
on
a
periodic
basis
in
accordance
with
contract
terms;
unrealized
gain
on
contracts
and
premiums
paid
are
reflected
as
assets
and
unrealized
loss
on
contracts
and
premiums
received
are
reflected
as
liabilities
on
the
accompanying
Statement
of
Assets
and
Liabilities.
For
bilateral
swaps,
premiums
paid
or
received
are
amortized
over
the
life
of
the
swap
and
are
recognized
as
realized
gain
or
loss
on
the
accompanying
Statement
of
Operations.
For
centrally
cleared
swaps,
payments
are
made
or
received
by
the
fund
each
day
to
settle
the
daily
fluctuation
in
the
value
of
the
contract
(variation
margin).
Accordingly,
the
value
of
a
centrally
cleared
swap
included
in
net
assets
is
the
unsettled
variation
margin;
net
variation
margin
receivable
is
reflected
as
an
asset
and
net
variation
margin
payable
is
reflected
as
a
liability
on
the
accompanying
Statement
of
Assets
and
Liabilities.
Interest
rate
swaps
are
agreements
to
exchange
cash
flows
based
on
the
difference
between
specified
interest
rates
applied
to
a
notional
principal
amount
for
a
specified
period
of
time.
Risks
related
to
the
use
of
interest
rate
swaps
include
the
potential
for
unanticipated
movements
in
interest
or
currency
rates,
the
possible
failure
of
a
counterparty
to
perform
in
accordance
with
the
T.
ROWE
PRICE
Dynamic
Credit
Fund
terms
of
the
swap
agreements,
potential
government
regulation
that
could
adversely
affect
the
fund’s
swap
investments,
and
potential
losses
in
excess
of
the
fund’s
initial
investment.
Credit
default
swaps
are
agreements
where
one
party
(the
protection
buyer)
agrees
to
make
periodic
payments
to
another
party
(the
protection
seller)
in
exchange
for
protection
against
specified
credit
events,
such
as
certain
defaults
and
bankruptcies
related
to
an
underlying
credit
instrument,
or
issuer
or
index
of
such
instruments.
Upon
occurrence
of
a
specified
credit
event,
the
protection
seller
is
required
to
pay
the
buyer
the
difference
between
the
notional
amount
of
the
swap
and
the
value
of
the
underlying
credit,
either
in
the
form
of
a
net
cash
settlement
or
by
paying
the
gross
notional
amount
and
accepting
delivery
of
the
relevant
underlying
credit.
For
credit
default
swaps
where
the
underlying
credit
is
an
index,
a
specified
credit
event
may
affect
all
or
individual
underlying
securities
included
in
the
index
and
will
be
settled
based
upon
the
relative
weighting
of
the
affected
underlying
security(ies)
within
the
index. Generally,
the
payment
risk
for
the
seller
of
protection
is
inversely
related
to
the
current
market
price
or
credit
rating
of
the
underlying
credit
or
the
market
value
of
the
contract
relative
to
the
notional
amount,
which
are
indicators
of
the
markets’
valuation
of
credit
quality.
As
of
June
30,
2024,
the
notional
amount
of
protection
sold
by
the
fund
totaled $40,606,000
(4.2%
of
net
assets),
which
reflects
the
maximum
potential
amount
the
fund
could
be
required
to
pay
under
such
contracts.
Risks
related
to
the
use
of
credit
default
swaps
include
the
possible
inability
of
the
fund
to
accurately
assess
the
current
and
future
creditworthiness
of
underlying
issuers,
the
possible
failure
of
a
counterparty
to
perform
in
accordance
with
the
terms
of
the
swap
agreements,
potential
government
regulation
that
could
adversely
affect
the
fund’s
swap
investments,
and
potential
losses
in
excess
of
the
fund’s
initial
investment.
Zero-coupon
inflation
swaps
are
agreements
to
exchange
cash
flows,
on
the
contract’s
maturity
date,
based
on
the
difference
between
a
predetermined
fixed
rate
and
the
cumulative
change
in
the
consumer
price
index,
both
applied
to
a
notional
principal
amount
for
a
specified
period
of
time.
Risks
related
to
the
use
of
zero-coupon
inflation
swaps
include
the
potential
for
unanticipated
movements
in
inflation
rates,
the
possible
failure
of
a
counterparty
to
perform
in
accordance
with
the
terms
of
the
swap
agreements,
potential
government
regulation
that
could
adversely
affect
the
fund’s
swap
investments,
and
potential
losses
in
excess
of
the
fund’s
initial
investment.
T.
ROWE
PRICE
Dynamic
Credit
Fund
Total
return
swaps
are
agreements
in
which
one
party
makes
payments
based
on
a
set
rate,
either
fixed
or
variable,
while
the
other
party
makes
payments
based
on
the
return
of
an
underlying
asset
(reference
asset),
such
as
an
index,
equity
security,
fixed
income
security
or
commodity-based
exchange-
traded
fund,
which
includes
both
the
income
it
generates
and
any
change
in
its
value.
Risks
related
to
the
use
of
total
return
swaps
include
the
potential
for
unfavorable
changes
in
the
reference
asset,
the
possible
failure
of
a
counterparty
to
perform
in
accordance
with
the
terms
of
the
swap
agreements,
potential
government
regulation
that
could
adversely
affect
the
fund’s
swap
investments,
and
potential
losses
in
excess
of
the
fund’s
initial
investment.
During
the
six
months ended
June
30,
2024,
the
volume
of
the
fund’s
activity
in
swaps,
based
on
underlying
notional
amounts,
was
generally
between
57%
and
135%
of
net
assets.
NOTE
4
-
OTHER
INVESTMENT
TRANSACTIONS
Consistent
with
its
investment
objective, the
fund
engages
in
the
following
practices
to
manage
exposure
to
certain
risks
and/or
to
enhance
performance.
The
investment
objective,
policies,
program,
and
risk
factors
of the
fund
are
described
more
fully
in the
fund’s prospectus
and
Statement
of
Additional
Information.
Emerging
and
Frontier
Markets
The fund
invests,
either
directly
or
through
investments
in
other
T.
Rowe
Price
funds,
in
securities
of
companies
located
in,
issued
by
governments
of,
or
denominated
in
or
linked
to
the
currencies
of
emerging
and
frontier
market
countries.
Emerging
markets,
and
to
a
greater
extent
frontier
markets, tend
to
have
economic
structures
that
are
less
diverse
and
mature,
less
developed
legal
and
regulatory
regimes,
and
political
systems
that
are
less
stable,
than
those
of
developed
countries.
These
markets
may
be
subject
to
greater
political,
economic,
and
social
uncertainty
and
differing
accounting
standards
and
regulatory
environments
that
may
potentially
impact
the
fund’s
ability
to
buy
or
sell
certain
securities
or
repatriate
proceeds
to
U.S.
dollars.
Emerging
markets
securities
exchanges
are
more
likely
to
experience
delays
with
the
clearing
and
settling
of
trades,
as
well
as
the
custody
of
holdings
by
local
banks,
agents,
and
depositories.
Such
securities
are
often
subject
to
greater
price
volatility,
less
liquidity,
and
higher
rates
of
inflation
than
U.S.
securities.
Investing
in
frontier
markets
is
typically
significantly
riskier
than
investing
in
other
countries,
including
emerging
markets.
T.
ROWE
PRICE
Dynamic
Credit
Fund
Noninvestment-Grade
Debt
The
fund
invests,
either
directly
or
through
its
investment
in
other
T.
Rowe
Price
funds,
in
noninvestment-grade
debt,
including
“high
yield”
or
“junk”
bonds
or
leveraged
loans.
Noninvestment-grade
debt
issuers
are
more
likely
to
suffer
an
adverse
change
in
financial
condition
that
would
result
in
the
inability
to
meet
a
financial
obligation.
The
noninvestment-
grade
debt
market
may
experience
sudden
and
sharp
price
swings
due
to
a
variety
of
factors
that
may
decrease
the
ability
of
issuers
to
make
principal
and
interest
payments
and
adversely
affect
the
liquidity
or
value,
or
both,
of
such
securities.
Accordingly,
securities
issued
by
such
companies
carry
a
higher
risk
of
default
and
should
be
considered
speculative.
Restricted
Securities
The
fund
invests
in
securities
that
are
subject
to
legal
or
contractual
restrictions
on
resale.
Prompt
sale
of
such
securities
at
an
acceptable
price
may
be
difficult
and
may
involve
substantial
delays
and
additional
costs.
Collateralized
Loan
Obligations
The
fund
invests
in
collateralized
loan
obligations
(CLOs)
which
are
entities
backed
by
a
diversified
pool
of
syndicated
bank
loans.
The
cash
flows
of
the
CLO
can
be
split
into
multiple
segments,
called
“tranches”
or
“classes”,
which
will
vary
in
risk
profile
and
yield.
The
riskiest
segments,
which
are
the
subordinate
or
“equity”
tranches,
bear
the
greatest
risk
of
loss
from
defaults
in
the
underlying
assets
of
the
CLO
and
serve
to
protect
the
other,
more
senior,
tranches.
Senior
tranches
will
typically
have
higher
credit
ratings
and
lower
yields
than
the
securities
underlying
the
CLO.
Despite
the
protection
from
the
more
junior
tranches,
senior
tranches
can
experience
substantial
losses.
Mortgage-Backed
Securities
The
fund
invests
in
mortgage-backed
securities
(MBS
or
pass-through
certificates)
that
represent
an
interest
in
a
pool
of
specific
underlying
mortgage
loans
and
entitle
the
fund
to
the
periodic
payments
of
principal
and
interest
from
those
mortgages.
MBS
may
be
issued
by
government
agencies
or
corporations,
or
private
issuers.
Most
MBS
issued
by
government
agencies
are
guaranteed;
however,
the
degree
of
protection
differs
based
on
the
issuer.
MBS are
sensitive
to
changes
in
economic
conditions
that
affect
the
rate
of
prepayments
and
defaults
on
the
underlying
mortgages;
accordingly,
the
value,
income,
and
related
cash
flows
from
MBS
may
be
more
volatile
than
other
debt
instruments.
Bank
Loans
The
fund
invests
in
bank
loans,
which
represent
an
interest
in
amounts
owed
by
a
borrower
to
a
syndicate
of
lenders.
Bank
loans
are
generally
noninvestment
grade
and
often
involve
borrowers
whose
financial
condition
is
highly
leveraged.
The
fund
may
invest
in
fixed
and
floating
rate
T.
ROWE
PRICE
Dynamic
Credit
Fund
loans,
which
may
include
senior
floating
rate
loans;
secured
and
unsecured
loans,
second
lien
or
more
junior
loans;
and
bridge
loans
or
bridge
facilities.
Certain
bank
loans
may
be
revolvers
which
are
a
form
of
senior
bank
debt,
where
the
borrower
can
draw
down
the
credit
of
the
revolver
when
it
needs
cash
and
repays
the
credit
when
the
borrower
has
excess
cash.
Certain
loans
may
be
“covenant-lite”
loans,
which
means
the
loans
contain
fewer
maintenance
covenants
than
other
loans
(in
some
cases,
none)
and
do
not
include
terms
which
allow
the
lender
to
monitor
the
performance
of
the
borrower
and
declare
a
default
if
certain
criteria
are
breached.
As
a
result
of
these
risks,
the
fund’s
exposure
to
losses
may
be
increased.
Bank
loans
may
be
in
the
form
of
either
assignments
or
participations.
A
loan
assignment
transfers
all
legal,
beneficial,
and
economic
rights
to
the
buyer,
and
transfer
typically
requires
consent
of
both
the
borrower
and
agent.
In
contrast,
a
loan
participation
generally
entitles
the
buyer
to
receive
the
cash
flows
from
principal,
interest,
and
any
fee
payments
on
a
portion
of
a
loan;
however,
the
seller
continues
to
hold
legal
title
to
that
portion
of
the
loan.
As
a
result,
the
buyer
of
a
loan
participation
generally
has
no
direct
recourse
against
the
borrower
and
is
exposed
to
credit
risk
of
both
the
borrower
and
seller
of
the
participation.
Bank
loans
often
have
extended
settlement
periods,
generally
may
be
repaid
at
any
time
at
the
option
of
the
borrower,
and
may
require
additional
principal
to
be
funded
at
the
borrowers’
discretion
at
a
later
date
(e.g.
unfunded
commitments
and
revolving
debt
instruments).
Until
settlement,
the
fund
maintains
liquid
assets
sufficient
to
settle
its
unfunded
loan
commitments.
The
fund
reflects
both
the
funded
portion
of
a
bank
loan
as
well
as
its
unfunded
commitment
in
the
Portfolio
of
Investments.
However,
if
a
credit
agreement
provides
no
initial
funding
of
a
tranche,
and
funding
of
the
full
commitment
at
a
future
date(s)
is
at
the
borrower’s
discretion
and
considered
uncertain,
a
loan
is
reflected
in
the
Portfolio
of
Investments
only
if,
and
only
to
the
extent
that,
the
fund
has
actually
settled
a
funding
commitment.
Securities
Lending
The fund
may
lend
its
securities
to
approved
borrowers
to
earn
additional
income.
Its
securities
lending
activities
are
administered
by
a
lending
agent
in
accordance
with
a
securities
lending
agreement.
Security
loans
generally
do
not
have
stated
maturity
dates,
and
the
fund
may
recall
a
security
at
any
time.
The
fund
receives
collateral
in
the
form
of
cash
or
U.S.
government
securities.
Collateral
is
maintained
over
the
life
of
the
loan
in
an
amount
not
less
than
the
value
of
loaned
securities;
any
additional
collateral
required
due
to
changes
in
security
values
is
delivered
to
the
fund
the
next
business
day.
Cash
T.
ROWE
PRICE
Dynamic
Credit
Fund
collateral
is
invested
in
accordance
with
investment
guidelines
approved
by
fund
management.
Additionally,
the
lending
agent
indemnifies
the
fund
against
losses
resulting
from
borrower
default.
Although
risk
is
mitigated
by
the
collateral
and
indemnification,
the
fund
could
experience
a
delay
in
recovering
its
securities
and
a
possible
loss
of
income
or
value
if
the
borrower
fails
to
return
the
securities,
collateral
investments
decline
in
value,
and
the
lending
agent
fails
to
perform.
Securities
lending
revenue
consists
of
earnings
on
invested
collateral
and
borrowing
fees,
net
of
any
rebates
to
the
borrower,
compensation
to
the
lending
agent,
and
other
administrative
costs.
In
accordance
with
GAAP,
investments
made
with
cash
collateral
are
reflected
in
the
accompanying
financial
statements,
but
collateral
received
in
the
form
of
securities
is
not.
At
June
30,
2024,
the
value
of
loaned
securities
was
$10,895,000;
the
value
of
cash
collateral
and
related
investments
was
$11,231,000.
Other
Purchases
and
sales
of
portfolio
securities
other
than
in-kind
transactions,
if
any,
short-term and
U.S.
government
securities
aggregated $1,028,935,000 and
$818,955,000,
respectively,
for
the
six
months ended
June
30,
2024.
NOTE
5
-
FEDERAL
INCOME
TAXES
Generally,
no
provision
for
federal
income
taxes
is
required
since
the
fund
intends
to continue
to
qualify
as
a
regulated
investment
company
under
Subchapter
M
of
the
Internal
Revenue
Code
and
distribute
to
shareholders
all
of
its taxable
income
and
gains.
Distributions
determined
in
accordance
with
federal
income
tax
regulations
may
differ
in
amount
or
character
from
net
investment
income
and
realized
gains
for
financial
reporting
purposes.
Financial
reporting
records
are
adjusted
for
permanent
book/tax
differences
to
reflect
tax
character
but
are
not
adjusted
for
temporary
differences.
The
amount
and
character
of
tax-basis
distributions
and
composition
of
net
assets
are
finalized
at
fiscal
year-end;
accordingly,
tax-basis
balances
have
not
been
determined
as
of
the
date
of
this
report.
The
fund
intends
to
retain
realized
gains
to
the
extent
of
available
capital
loss
carryforwards.
Net
realized
capital
losses
may
be
carried
forward
indefinitely
to
offset
future
realized
capital
gains.
As
of
December
31,
2023,
the
fund
had
$16,618,000
of
available
capital
loss
carryforwards.
T.
ROWE
PRICE
Dynamic
Credit
Fund
At
June
30,
2024,
the
cost
of
investments
(including
derivatives,
if
any)
for
federal
income
tax
purposes
was
$960,843,000.
Net
unrealized
gain
aggregated
$9,081,000
at
period-end,
of
which
$37,441,000
related
to
appreciated
investments
and
$28,360,000
related
to
depreciated
investments.
NOTE
6
-
RELATED
PARTY
TRANSACTIONS
The
fund
is
managed
by
T.
Rowe
Price
Associates,
Inc.
(Price
Associates),
a
wholly
owned
subsidiary
of
T.
Rowe
Price
Group,
Inc.
(Price
Group).
The
investment
management
agreement
between
the
fund
and
Price
Associates
provides
for
an
annual
investment
management
fee,
which
is
computed
daily
and
paid
monthly. The
fee
consists
of
an
individual
fund
fee,
equal
to
0.22%
of
the
fund’s
average
daily
net
assets,
and
a
group
fee.
The
group
fee
rate
is
calculated
based
on
the
combined
net
assets
of
certain
mutual
funds
sponsored
by
Price
Associates
(the
group)
applied
to
a
graduated
fee
schedule,
with
rates
ranging
from
0.48%
for
the
first
$1
billion
of
assets
to
0.260%
for
assets
in
excess
of
$845
billion.
The
fund’s
group
fee
is
determined
by
applying
the
group
fee
rate
to
the
fund’s
average
daily
net
assets. At
June
30,
2024,
the
effective
annual
group
fee
rate
was
0.29%.
The Investor
Class is
subject
to
a
contractual
expense
limitation
through
the
expense
limitation
date
indicated
in
the
table
below.
This
agreement
will
continue
through
the
expense
limitation
date
indicated
in
the
table
below,
and
may
be
renewed,
revised,
or
revoked
only
with
approval
of
the
fund’s
Board.
During
the
limitation
period,
Price
Associates
is required
to
waive
or
pay
any
expenses
(excluding
interest;
expenses
related
to
borrowings,
taxes,
and
brokerage;
non-recurring,
extraordinary
expenses;
and
acquired
fund
fees
and
expenses)
that
would
otherwise
cause
the class's ratio
of
annualized
total
expenses
to
average
net
assets
(net
expense
ratio)
to
exceed
its
expense
limitation.
The
class
is
required
to
repay
Price
Associates
for
expenses
previously
waived/paid
to
the
extent
the
class's net
assets
grow
or
expenses
decline
sufficiently
to
allow
repayment
without
causing
the class's net
expense
ratio
(after
the
repayment
is
taken
into
account)
to
exceed
the
lesser
of:
(1)
the
expense
limitation
in
place
at
the
time
such
amounts
were
waived;
or
(2)
the class's
current
expense
limitation.
However,
no
repayment
will
be
made
more
than
three
years
after
the
date
of
a
payment
or
waiver.
The
I
Class
is
also
subject
to
an
operating
expense
limitation
(I
Class
Limit)
pursuant
to
which
Price
Associates
is
contractually
required
to
pay
all
operating
expenses
of
the
I
Class,
excluding
management
fees;
interest;
expenses
related
T.
ROWE
PRICE
Dynamic
Credit
Fund
to
borrowings,
taxes,
and
brokerage; non-recurring,
extraordinary expenses; and
acquired
fund
fees
and
expenses, to
the
extent
such
operating
expenses,
on
an
annualized
basis,
exceed
the
I
Class
Limit. This
agreement
will
continue
through
the
expense
limitation
date
indicated
in
the
table
below,
and
may
be
renewed,
revised,
or
revoked
only
with
approval
of
the
fund’s
Board.
The
I
Class
is
required
to
repay
Price
Associates
for
expenses
previously
paid
to
the
extent
the
class’s
net
assets
grow
or
expenses
decline
sufficiently
to
allow
repayment
without
causing
the
class’s
operating
expenses
(after
the
repayment
is
taken
into
account)
to
exceed
the
lesser
of:
(1)
the
I
Class
Limit
in
place
at
the
time
such
amounts
were
paid;
or
(2)
the
current
I
Class
Limit.
However,
no
repayment
will
be
made
more
than
three
years
after
the
date
of
a
payment
or
waiver.
The
Z
Class
is
also
subject
to
a
contractual
expense
limitation
agreement
whereby
Price
Associates
has
agreed
to
waive
and/or
bear
all
of
the
Z
Class’
expenses
(excluding
interest;
expenses
related
to
borrowings,
taxes,
and
brokerage;
non-recurring,
extraordinary
expenses;
and
acquired
fund
fees
and
expenses)
in
their
entirety.
This
fee
waiver
and/or
expense
reimbursement
arrangement
is
expected
to
remain
in
place
indefinitely,
and
the
agreement
may
only
be
amended
or
terminated
with
approval
by
the
fund’s
Board.
Expenses
of
the
fund
waived/paid
by
the
manager
are
not
subject
to
later
repayment
by
the
fund.
Pursuant
to
these
agreements,
expenses
were
waived/paid
by
and/or
repaid
to
Price
Associates
during
the
six
months ended June
30,
2024
as
indicated
in
the
table
below.
Including these
amounts,
expenses
previously
waived/paid
by
Price
Associates
in
the
amount
of $739,000 remain
subject
to
repayment
by
the
fund
at
June
30,
2024.
Any
repayment
of
expenses
previously
waived/paid
by
Price
Associates
during
the
period
would
be
included
in
the
net
investment
income
and
expense
ratios
presented
on
the
accompanying
Financial
Highlights.
In
addition,
the
fund
has
entered
into
service
agreements
with
Price
Associates
and
a
wholly
owned
subsidiary
of
Price
Associates,
each
an
affiliate
of
the
fund
(collectively,
Price).
Price
Associates
provides
certain
accounting
and
administrative
services
to
the
fund.
T.
Rowe
Price
Services,
Inc.
provides
Investor
Class
I
Class
Class
Z
Expense
limitation/I
Class
Limit
0.63%
0.05%
0.00%
Expense
limitation
date
02/28/27
02/28/27
N/A
(Waived)/repaid
during
the
period
($000s)
$(19)
$(3)
$(2,379)
T.
ROWE
PRICE
Dynamic
Credit
Fund
shareholder
and
administrative
services
in
its
capacity
as
the
fund’s
transfer
and
dividend-disbursing
agent.
For
the
six
months
ended
June
30,
2024,
expenses
incurred
pursuant
to
these
service
agreements
were
$64,000
for
Price
Associates
and
$17,000
for
T.
Rowe
Price
Services,
Inc.
All
amounts
due
to
and
due
from
Price,
exclusive
of
investment
management
fees
payable,
are
presented
net
on
the
accompanying
Statement
of
Assets
and
Liabilities.
T.
Rowe
Price
Investment
Services,
Inc.
(Investment
Services)
serves
as
distributor
to
the
fund.
Pursuant
to
an
underwriting
agreement,
no
compensation
for
any
distribution
services
provided
is
paid
to
Investment
Services
by
the
fund
(except
for
12b-1
fees
under
a
Board-approved
Rule
12b-1
plan).
Mutual
funds,
trusts,
and
other
accounts
managed
by
Price
Associates
or
its
affiliates
(collectively,
Price
Funds
and
accounts)
may
invest
in
the
fund.
No
Price
fund
or
account
may
invest
for
the
purpose
of
exercising
management
or
control
over
the
fund.
At
June
30,
2024, 100%
of
the
Z
Class's
outstanding
shares
were
held
by
Price
Funds
and
accounts.
The fund
may
invest
its
cash
reserves
in
certain
open-end
management
investment
companies
managed
by
Price
Associates
and
considered
affiliates
of
the
fund:
the
T.
Rowe
Price
Government
Reserve
Fund
or
the
T.
Rowe
Price
Treasury
Reserve
Fund,
organized
as
money
market
funds
(together,
the
Price
Reserve
Funds).
The
Price
Reserve
Funds
are
offered
as
short-term
investment
options
to
mutual
funds,
trusts,
and
other
accounts
managed
by
Price
Associates
or
its
affiliates
and
are
not
available
for
direct
purchase
by
members
of
the
public.
Cash
collateral
from
securities
lending,
if
any,
is
invested
in
the
T.
Rowe
Price
Government
Reserve Fund. The
Price
Reserve
Funds
pay
no
investment
management
fees.
The fund may
participate
in
securities
purchase
and
sale
transactions
with
other
funds
or
accounts
advised
by
Price
Associates
(cross
trades),
in
accordance
with
procedures
adopted
by the
fund’s
Board
and
Securities
and
Exchange
Commission
rules,
which
require,
among
other
things,
that
such
purchase
and
sale
cross
trades
be
effected
at
the
independent
current
market
price
of
the
security.
During
the
six
months
ended
June
30,
2024,
the
fund
had
no
purchases
or
sales
cross
trades
with
other
funds
or
accounts
advised
by
Price
Associates.
T.
ROWE
PRICE
Dynamic
Credit
Fund
NOTE
7
-
OTHER
MATTERS
Unpredictable environmental,
political,
social
and
economic
events,
including
but
not
limited
to,
environmental
or
natural
disasters,
war
and
conflict
(including
Russia’s
military
invasion
of
Ukraine
and
the
conflict
in
Israel,
Gaza
and
surrounding
areas),
terrorism,
geopolitical
developments
(including
trading
and
tariff
arrangements,
sanctions
and
cybersecurity
attacks),
and
public
health
epidemics
(including
the
global
outbreak
of
COVID-19)
and
similar
public
health
threats,
may
significantly
affect
the
economy
and
the
markets
and
issuers
in
which
a
fund
invests.
The
extent
and
duration
of
such
events
and
resulting
market
disruptions
cannot
be
predicted.
These
and
other
similar
events
may
cause
instability
across
global
markets,
including
reduced
liquidity
and
disruptions
in
trading
markets,
while
some
events
may
affect
certain
geographic
regions,
countries,
sectors,
and
industries
more
significantly
than
others,
and
exacerbate
other
pre-existing
political,
social,
and
economic
risks.
The
fund’s
performance
could
be
negatively
impacted
if
the
value
of
a
portfolio
holding
were
harmed
by
these
or
such
events.
Management
actively
monitors
the
risks
and
financial
impacts
arising
from
such
events.
T.
ROWE
PRICE
Dynamic
Credit
Fund
APPROVAL
OF
INVESTMENT
MANAGEMENT
AGREEMENT
Each
year,
the
fund’s
Board
of
Directors
(Board)
considers
the
continuation
of
the
investment
management
agreement
(Advisory
Contract)
between
the
fund
and
its
investment
adviser,
T.
Rowe
Price
Associates,
Inc.
(Adviser).
In
that
regard,
at
a
meeting
held
on
March
11–12,
2024
(Meeting),
the
Board,
including
all
of
the
fund’s
independent
directors
present
in
person
at
the
Meeting,
approved
the
continuation
of
the
fund’s
Advisory
Contract.
At
the
Meeting,
the
Board
considered
the
factors
and
reached
the
conclusions
described
below
relating
to
the
selection
of
the
Adviser
and
the
approval
of
the
Advisory
Contract.
The
independent
directors
were
assisted
in
their
evaluation
of
the
Advisory
Contract
by
independent
legal
counsel
from
whom
they
received
separate
legal
advice
and
with
whom
they
met
separately.
In
providing
information
to
the
Board,
the
Adviser
was
guided
by
a
detailed
set
of
requests
for
information
submitted
by
independent
legal
counsel
on
behalf
of
the
independent
directors.
In
considering
and
approving
the
continuation
of
the
Advisory
Contract,
the
Board
considered
the
information
it
believed
was
relevant,
including,
but
not
limited
to,
the
information
discussed
below.
The
Board
considered
not
only
the
specific
information
presented
in
connection
with
the
Meeting,
but
also
the
knowledge
gained
over
time
through
interaction
with
the
Adviser
about
various
topics.
The
Board
meets
regularly
and,
at
each
of
its
meetings,
covers
an
extensive
agenda
of
topics
and
materials
and
considers
factors
that
are
relevant
to
its
annual
consideration
of
the
renewal
of
the
T.
Rowe
Price
funds’
advisory
contracts,
including
performance
and
the
services
and
support
provided
to
the
funds
and
their
shareholders.
Services
Provided
by
the
Adviser
The
Board
considered
the
nature,
quality,
and
extent
of
the
services
provided
to
the
fund
by
the
Adviser.
These
services
included,
but
were
not
limited
to,
directing
the
fund’s
investments
in
accordance
with
its
investment
program
and
the
overall
management
of
the
fund’s
portfolio,
as
well
as
a
variety
of
related
activities
such
as
financial,
investment
operations,
and
administrative
services;
compliance;
maintaining
the
fund’s
records
and
registrations;
and
shareholder
communications.
The
Board
also
reviewed
the
background
and
experience
of
the
Adviser’s
senior
management
team
and
investment
personnel
involved
in
the
management
of
the
fund,
as
well
as
the
Adviser’s
compliance
record.
The
Board
concluded
that
the
information
it
considered
with
respect
to
the
nature,
quality,
and
extent
of
the
services
provided
by
the
Adviser,
as
well
as
the
other
factors
considered
at
the
Meeting,
supported
the
Board’s
approval
of
the
continuation
of
the
Advisory
Contract.
T.
ROWE
PRICE
Dynamic
Credit
Fund
Investment
Performance
of
the
Fund
The
Board
took
into
account
discussions
with
the
Adviser
and
detailed
reports
that
it
regularly
receives
throughout
the
year
on
relative
and
absolute
performance
for
the
T.
Rowe
Price
funds.
In
connection
with
the
Meeting,
the
Board
reviewed
information
provided
by
the
Adviser
that
compared
the
fund’s
total
returns,
as
well
as
a
wide
variety
of
other
previously
agreed-upon
performance
measures
and
market
data,
against
relevant
benchmark
indexes
and
peer
groups
of
funds
with
similar
investment
programs
for
various
periods
through
December
31,
2023.
Additionally,
the
Board
reviewed
the
fund’s
relative
performance
information
as
of
September
30,
2023,
which
ranked
the
returns
of
the
fund’s
Investor
Class
for
various
periods
against
a
universe
of
funds
with
similar
investment
programs
selected
by
Broadridge,
an
independent
provider
of
mutual
fund
data.
In
the
course
of
its
deliberations,
the
Board
considered
performance
information
provided
throughout
the
year
and
in
connection
with
the
Advisory
Contract
review
at
the
Meeting,
as
well
as
information
provided
during
investment
review
meetings
conducted
with
portfolio
managers
and
senior
investment
personnel
during
the
course
of
the
year
regarding
the
fund’s
performance.
The
Board
also
considered
relevant
factors,
such
as
overall
market
conditions
and
trends
that
could
adversely
impact
the
fund’s
performance,
the
length
of
the
fund’s
performance
track
record,
and
how
closely
the
fund’s
strategies
align
with
its
benchmarks
and
peer
groups.
The
Board
noted
that,
as
of
December
31,
2023,
the
fund
lagged
its
benchmark
for
certain
performance
periods
and
the
fund’s
total
returns
ranked
in
the
fourth
quartile
for
certain
periods
when
compared
with
performance
peer
groups
selected
by
third-party
data
providers.
The
Adviser
provided
the
Board
with
information
addressing
the
fund’s
performance
relative
to
its
benchmarks
and
performance
peers
during
the
applicable
periods
and
the
primary
reasons
for
such
results.
The
Board
considered
the
Adviser’s
responses
relating
to
the
fund’s
performance
during
certain
of
the
evaluated
periods
and
noted
that
it
will
continue
to
monitor
the
fund’s
performance.
The
Board
concluded
that
the
information
it
considered
with
respect
to
the
fund’s
performance,
as
well
as
the
other
factors
considered
at
the
Meeting,
supported
the
Board’s
approval
of
the
continuation
of
the
Advisory
Contract.
Costs,
Benefits,
Profits,
and
Economies
of
Scale
The
Board
reviewed
detailed
information
regarding
the
revenues
received
by
the
Adviser
under
the
Advisory
Contract
and
other
direct
and
indirect
benefits
that
the
Adviser
(and
its
affiliates)
may
have
realized
from
its
relationship
with
the
fund.
In
considering
soft-dollar
arrangements
pursuant
to
which
research
may
be
received
from
broker-dealers
that
execute
the
fund’s
portfolio
transactions,
the
Board
noted
APPROVAL
OF
INVESTMENT
MANAGEMENT
AGREEMENT
(continued)
T.
ROWE
PRICE
Dynamic
Credit
Fund
that
during
2023
the
Adviser
paid
the
costs
of
research
services
for
all
client
accounts
that
it
advises,
including
the
T.
Rowe
Price
funds.
However,
effective
January
1,
2024,
the
Adviser
will
begin
using
brokerage
commissions
in
connection
with
certain
T.
Rowe
Price
funds’
securities
transactions
to
pay
for
research
when
permissible.
The
Board
received
information
on
the
estimated
costs
incurred
and
profits
realized
by
the
Adviser
from
managing
the
T.
Rowe
Price
funds.
While
the
Board
did
not
review
information
regarding
profits
realized
from
managing
the
fund
in
particular
because
the
fund
had
either
not
achieved
sufficient
portfolio
asset
size
or
not
recognized
sufficient
revenues
to
produce
meaningful
profit
margin
percentages,
the
Board
concluded
that
the
Adviser’s
profits
were
reasonable
in
light
of
the
services
provided
to
the
T.
Rowe
Price
funds.
The
Board
also
considered
whether
the
fund
benefits
under
the
fee
levels
set
forth
in
the
Advisory
Contract
or
otherwise
from
any
economies
of
scale
realized
by
the
Adviser.
Under
the
Advisory
Contract,
the
fund
pays
a
fee
to
the
Adviser
for
investment
management
services
composed
of
two
components—a
group
fee
rate
based
on
the
combined
average
net
assets
of
most
of
the
T.
Rowe
Price
funds
(including
the
fund)
that
declines
at
certain
asset
levels
and
an
individual
fund
fee
rate
based
on
the
fund’s
average
daily
net
assets—and
the
fund
pays
its
own
expenses
of
operations.
The
group
fee
rate
decreases
as
total
T.
Rowe
Price
fund
assets
grow,
which
reduces
the
management
fee
rate
for
any
fund
that
has
a
group
fee
component
to
its
management
fee,
and
reflects
that
certain
resources
utilized
to
operate
the
fund
are
shared
with
other
T.
Rowe
Price
funds,
thus
allowing
shareholders
of
those
funds
to
share
potential
economies
of
scale.
The
fund’s
shareholders
also
benefit
from
potential
economies
of
scale
through
a
decline
in
certain
operating
expenses
as
the
fund
grows
in
size.
However,
the
fund
is
also
subject
to
contractual
expense
limitations
that
require
the
Adviser
to
waive
its
fees
and/or
bear
any
expenses
that
would
otherwise
cause
the
expenses
of
a
share
class
of
the
fund
to
exceed
a
certain
percentage
based
on
the
class’s
net
assets.
The
expense
limitations
protect
shareholders
from
relatively
high
expenses
until
the
fund
reaches
greater
scale
and
mitigate
the
potential
for
an
increase
in
operating
expenses
above
a
certain
level
that
could
impact
shareholders.
The
fund
also
offers
a
Z
Class,
which
serves
as
an
underlying
investment
within
certain
T.
Rowe
Price
fund
of
funds
arrangements.
The
Adviser
waives
its
advisory
fee
on
the
Z
Class
and
waives
or
bears
the
Z
Class’s
other
operating
expenses,
with
certain
exceptions.
The
Board
considered
whether
the
advisory
fee
and
operating
expense
waivers
on
the
Z
Class
may
present
a
means
for
cross-
subsidization
of
the
Z
Class
by
other
share
classes
of
the
fund.
In
that
regard,
APPROVAL
OF
INVESTMENT
MANAGEMENT
AGREEMENT
(continued)
T.
ROWE
PRICE
Dynamic
Credit
Fund
the
Board
noted
that
the
Z
Class
operating
expenses
are
largely
covered
by
the
all-inclusive
fees
charged
by
the
investing
T.
Rowe
Price
fund
of
funds
and
that
any
Z
Class
operating
expenses
not
covered
by
the
investing
T.
Rowe
Price
fund
of
funds’
fees
are
paid
by
the
Adviser
and
not
by
shareholders
of
any
other
share
class
of
the
fund.
In
addition,
the
Board
noted
that
the
fund
potentially
shares
in
indirect
economies
of
scale
through
the
Adviser’s
ongoing
investments
in
its
business
in
support
of
the
T.
Rowe
Price
funds,
including
investments
in
trading
systems,
technology,
and
regulatory
support
enhancements,
and
the
ability
to
possibly
negotiate
lower
fee
arrangements
with
third-party
service
providers.
The
Board
concluded
that
the
advisory
fee
structure
for
the
fund
provides
for
a
reasonable
sharing
of
benefits
from
any
economies
of
scale
with
the
fund’s
investors.
Fees
and
Expenses
The
Board
was
provided
with
information
regarding
industry
trends
in
management
fees
and
expenses.
Among
other
things,
the
Board
reviewed
data
for
peer
groups
that
were
compiled
by
Broadridge,
which
compared:
(i)
contractual
management
fees,
actual
management
fees,
nonmanagement
expenses,
and
total
expenses
of
the
Investor
Class
of
the
fund
with
a
group
of
competitor
funds
selected
by
Broadridge
(Expense
Group)
and
(ii)
actual
management
fees,
nonmanagement
expenses,
and
total
expenses
of
the
Investor
Class
of
the
fund
with
a
broader
set
of
funds
within
the
Lipper
investment
classification
(Expense
Universe).
The
Board
considered
the
fund’s
contractual
management
fee
rate,
actual
management
fee
rate
(which
reflects
the
management
fees
actually
received
from
the
fund
by
the
Adviser
after
any
applicable
waivers,
reductions,
or
reimbursements),
operating
expenses,
and
total
expenses
(which
reflect
the
net
total
expense
ratio
of
the
fund
after
any
waivers,
reductions,
or
reimbursements)
in
comparison
with
the
information
for
the
Broadridge
peer
groups.
Broadridge
generally
constructed
the
peer
groups
by
seeking
the
most
comparable
funds
based
on
similar
investment
classifications
and
objectives,
expense
structure,
asset
size,
and
operating
components
and
attributes
and
ranked
funds
into
quintiles,
with
the
first
quintile
representing
the
funds
with
the
lowest
relative
expenses
and
the
fifth
quintile
representing
the
funds
with
the
highest
relative
expenses.
The
information
provided
to
the
Board
indicated
that
the
fund’s
contractual
management
fee
ranked
in
the
second
quintile
(Expense
Group),
the
fund’s
actual
management
fee
rate
ranked
in
the
first
quintile
(Expense
Group
and
Expense
Universe),
and
the
fund’s
total
expenses
ranked
in
the
first
quintile
(Expense
Group
and
Expense
Universe).
APPROVAL
OF
INVESTMENT
MANAGEMENT
AGREEMENT
(continued)
T.
ROWE
PRICE
Dynamic
Credit
Fund
The
Board
also
reviewed
the
fee
schedules
for
other
investment
portfolios
with
similar
mandates
that
are
advised
or
subadvised
by
the
Adviser
and
its
affiliates,
including
separately
managed
accounts
for
institutional
and
individual
investors;
subadvised
funds;
and
other
sponsored
investment
portfolios,
including
collective
investment
trusts
and
pooled
vehicles
organized
and
offered
to
investors
outside
the
United
States.
Management
provided
the
Board
with
information
about
the
Adviser’s
responsibilities
and
services
provided
to
subadvisory
and
other
institutional
account
clients,
including
information
about
how
the
requirements
and
economics
of
the
institutional
business
are
fundamentally
different
from
those
of
the
proprietary
mutual
fund
business.
The
Board
considered
information
showing
that
the
Adviser’s
mutual
fund
business
is
generally
more
complex
from
a
business
and
compliance
perspective
than
its
institutional
account
business
and
considered
various
relevant
factors,
such
as
the
broader
scope
of
operations
and
oversight,
more
extensive
shareholder
communication
infrastructure,
greater
asset
flows,
heightened
business
risks,
and
differences
in
applicable
laws
and
regulations
associated
with
the
Adviser’s
proprietary
mutual
fund
business.
In
assessing
the
reasonableness
of
the
fund’s
management
fee
rate,
the
Board
considered
the
differences
in
the
nature
of
the
services
required
for
the
Adviser
to
manage
its
mutual
fund
business
versus
managing
a
discrete
pool
of
assets
as
a
subadviser
to
another
institution’s
mutual
fund
or
for
an
institutional
account
and
that
the
Adviser
generally
performs
significant
additional
services
and
assumes
greater
risk
in
managing
the
fund
and
other
T.
Rowe
Price
funds
than
it
does
for
institutional
account
clients,
including
subadvised
funds.
On
the
basis
of
the
information
provided
and
the
factors
considered,
the
Board
concluded
that
the
fees
paid
by
the
fund
under
the
Advisory
Contract
are
reasonable.
Approval
of
the
Advisory
Contract
As
noted,
the
Board
approved
the
continuation
of
the
Advisory
Contract.
No
single
factor
was
considered
in
isolation
or
to
be
determinative
to
the
decision.
Rather,
the
Board
concluded,
in
light
of
a
weighting
and
balancing
of
all
factors
considered,
that
it
was
in
the
best
interests
of
the
fund
and
its
shareholders
for
the
Board
to
approve
the
continuation
of
the
Advisory
Contract
(including
the
fees
to
be
charged
for
services
thereunder).
APPROVAL
OF
INVESTMENT
MANAGEMENT
AGREEMENT
(continued)
100
East
Pratt
Street
Baltimore,
MD
21202
T.
Rowe
Price
Investment
Services,
Inc.
Call
1-800-225-5132
to
request
a
prospectus
or
summary
prospectus;
each
includes
investment
objectives,
risks,
fees,
expenses,
and
other
information
that
you
should
read
and
consider
carefully
before
investing.
F1175-051
8/24
Item 8. Changes in and Disagreements with Accountants for Open-End Management Investment Companies.
Not applicable.
Item 9. Proxy Disclosures for Open-End Management Investment Companies.
Not applicable.
Item 10. Remuneration Paid to Directors, Officers, and Others of Open-End Management Investment Companies.
Remuneration paid to Directors is included in Item 7 of this Form N-CSR and/or the Statement of Additional Information.
Item 11. Statement Regarding Basis for Approval of Investment Advisory Contract.
If applicable, see Item 7.
Item 12. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
Item 13. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 14. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 15. Submission of Matters to a Vote of Security Holders.
There has been no change to the procedures by which shareholders may recommend nominees to the registrant’s board of directors.
Item 16. Controls and Procedures.
(a) The registrant’s principal executive officer and principal financial officer have evaluated the registrant’s disclosure controls and procedures within 90 days of this filing and have concluded that the registrant’s disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-CSR was recorded, processed, summarized, and reported timely.
(b) The registrant’s principal executive officer and principal financial officer are aware of no change in the registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 17. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
Not applicable.
Item 18. Recovery of Erroneously Awarded Compensation.
Not applicable.
Item 19. Exhibits.
| (a)(1) | The registrant’s code of ethics pursuant to Item 2 of Form N-CSR is filed with the registrant’s annual Form N-CSR. |
| (2) | Listing standards relating to recovery of erroneously awarded compensation: Not applicable. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | | | |
| T. Rowe Price Dynamic Credit Fund |
| By | | /s/ David Oestreicher | | |
| | David Oestreicher | | |
| | Principal Executive Officer | | |
| | |
| Date | | August 20, 2024 | | |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| | | | |
| By | | /s/ David Oestreicher | | |
| | David Oestreicher | | |
| | Principal Executive Officer | | |
| | |
| Date | | August 20, 2024 | | |
| | | | |
| By | | /s/ Alan S. Dupski | | |
| | Alan S. Dupski | | |
| | Principal Financial Officer | | |
| | |
| Date | | August 20, 2024 | | |
