Golub Capital BDC (GBDC) 20 Nov 242024 Q4 Earnings call transcript

Hello, everyone, and welcome to GBDC's earnings call for the fiscal year and fiscal quarter ended September 30, 2024.

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

For materials we intend to refer to on today's earnings call, please visit the Investor Resources tab on the homepage of our website, which is www.golubcapitalbdc.com and click on the Events Presentations link.

Our earnings release is also available on our website in the Investor Resources section.

call call recorded. With Chief over of this to I'm Executive reminder, GBDC. the turn to a is that, being pleased Officer As David Golub,

Chris us and Benton, Matt Operating I'm for everybody, Chief Chief joining Hello, joined Officer; thanks our by Ericson, Officer. and our Financial today.

to our sponsors. Yesterday, strategy an earnings partnership-oriented that senior issued fiscal you We'll to secured we wrap and the in a more on For start investment had coming questions. The Matt and GBDC healthy, detail. are private that are on quarter, focus press resilient a presentation to new through release for quarter call. XX, website. today's our to that for who financial companies with XXXX. the And September finally, for solid ended backed headlines loans during strong and operating headline is going fiscal go usual then take up with and and the of performance by of providing the be as to equity quarter our a I'll earnings and and year our middle-market period, referring to summary for outlook fourth I'm with some we GBDC, the and is course first quarter the good are Chris posted for presentation lien going performance our I'll

landmark a of had fiscal events made recall You'll more XXXX value number compelling. GBDC's that that shareholder proposition

led per of far. and of permanent a win-win-win the framework rate; most framework a so that second, new $X.XX And merger reduction supplemental GBDC incentive share has distribution a importantly, in with and X. fee distributions affiliate third closing First, variable distribution second supplemental company's the to

was it mind the fiscal of whole. With to adjusted to a XXXX over Chris. as on Adjusted XX.X%. share year I return was in income final quarter. Adjusted So on for adjusted the corresponds a results for of for while fiscal benefited corresponds performance think equity for I few on NII to net important X.X% several going to XX.X%. share today per the $X.XX, return per fiscal keep the transformational on quarter was the course return $X.XX touch highlights quarters. quarter hand recent that the Adjusted XX.X%. it's the continuation was from an nature year and for on full the we've highlighted fiscal and of the year, to Adjusted NII full equity return trends for equity GBDC's NII that focus before This on over we're of me an of let context, GBDC's that equity Matt quarter. the of

strong, you'll borrower see First, metrics. performance as generally talk when credit key through remained we

of earnings boost Second, power GBDC's continue the high rates to base portfolio.

combined think fee industry-leading I manager from Pluralsight GBDC's structure, the it during Imperial primarily investment about fee GBDC's these underperforming also Third, Optical. and quarter incentive from The $X.XX talked that days. We is tail had last meant voluntary said, GBDC with during quarter, of created. shareholders captured a per that waiver That that GBDC value more share structure. fee the faced GBDC some headwinds outcomes in everybody of headwinds borrowers quarter, to loans negative credit on a facing how the

reflected are that credit as see worked as this well in the Pluralsight losses realized in and During this P&L. quarter's a of can quarter, other September we you XX restructuring nonaccrual one through longtime

that post-restructuring have the investment GBDC underperforming now professionals we've is we and Our both use playbook bench several upside focus, minimize believe to to cases, losses. deep as positions of equity always, In with decades developed experienced over holds borrowers that ultimate our potential. these

realized that we version September quarter, are than unrealized and several it companies normal. markdowns losses, higher value of was but again of other our some net it fair the on quarter-over-quarter improved quantum took also XX underperforming. During The

but year and very I'll wasn't go for fiscal to back this sets long the theme was it good, in we was that, it come up Matt a So remarks. With good, our end fiscal through term. that of transformational detail. performance the outlook discuss I'll it the well our I in quarter believe solid the gave when QX more pass GBDC short, great, over ending to GBDC mic to prepared to at Benton a

net per X.X%. X adjusted on corresponding was ROE $X.XX, start an NII were corresponding NII factors. $X.XX, ROE to David. key an XX.X%. share Slide X. Thanks, earnings of Adjusted of I'm GBDC's adjusted was to share to by income per going Adjusted earnings driven

was credit write-downs we on solid. several fair took But performance value David said, some First, underperformers. generally as

high Second, with rates by consistent continued supported recent earnings were base quarters.

fee approximately from an elected leading fourth, portion GBDC benefited in investment earnings. We voluntarily to share expenses benefit an these funding did due the of initiatives debt we sustainably and post undertook Capital hit to initiatives investment net manager benefit to to the bit. GBDC giving end. by advisory from investment early from this experience Third, equated This on exciting funds GBDC's quarter. investors $X.XX I'll enhance the its quarter income structure; cost more and reductions a on this lower in its to Golub shareholder will a detail onetime a recognize fee of per basis, waive

get GBDC EBITDA of associated we power funds net did credit approximately quality billion, unfunded looser, This of growth portfolio leverage. take portfolio this shown in leverage post transactions, around credit. In the $X seeing we all not and definitions and XX-year back-end Let that private modestly, with commitments compression, the in markets by in $XXX was After syndicated credit want sequentially. investment to benefit grade increased from of portfolio merger. earnings pendulum from much million because across in are originations, around general. comments environment as which of represented in the factoring larger-sized some quarter higher more full a X%. up especially, net up growth summarize growth the me trade originations quarter. sought Gross nearly to repayments environment offer last The activity borrower-friendly were spread has to current broadly to underwriting and especially weighted. I documentation, the to types market deal the

underwriting to to these more shifted have past more we on core chosen focus and over selective this market be purposely year, trends have As middle transactions.

Our wide see allows -- over be we capital, opportunities Golub to Year-to-date our typically funnel depict us our stats annually. conservatism. origination X,XXX

XX%; the X/X that X%; deals rate we've lender sole and third, runner been selectivity the borrower in of year-to-date, the of Capital our over First, done. or Golub percentage sole transactions about lead of the we've repeat as acted XX% a second, of in almost book

in mid-XX% structures everyone [indiscernible] is to at as the range controlling which, with origination documentation, LTV of generally our the LTVs our we're average So average and have of typical knows, . been an mid-XX% approximately Fourth, XX%. time

the Finally, given million. for The below play the to has median middle $XX origination risk-adjusted our pricing in EBITDA core dynamics, market. are we choosing been

the of fair the during X value from of X David's While at remain increased in total portfolio to GBDC's very value at of credits XX.X% see quarter. with overview, Category representing this strong, X portfolio and did small decreased categories the XX.X% X.X% XX.X% credit overall fair rating investments value. rating the at in of low, X in categories quarter. performance increase just X to Category remains slightly XX.X% quarter-over-quarter. And Investments we investment a X and the portfolio fair from portfolio rating consistent in Investments

at percentage investments of nonaccruals a X.X% fair the from total debt slightly increased in at X% value, As end to quarter. quarter June

share the in X well these quarter, in nonaccrual balance briefly Slide share the former In was with on $X.XX small the reminder, sheet conjunction in merger quarter. August the of base included paid well offset positions. Continuing the declared the BDC below of Distributions of of the X distributions these very number the nonaccrual is changes as metrics are investments certain variable not average. share, nonaccrual sector a quarter as declared in distribution quarterly by paid let June the $X.XX As XXXX restructuring Several and XX% addition per increased also distribution X the X, quarterly of in in the GBDC $X.XX per to supplemental special distribution were summarize per me only the closing. quarter. share of investments investments but per $X.XX

expect eliminate need excise pay on to supplementals earnings. We undistributed GBDC's these tax to

cash in any form GBDC's we paying shareholders we've would a an As share of sequential the trapped because outstanding which on per high. purposes quarter-over-quarter of $X.XX clear is NAV was believe higher capital debt From return the the of for to past, perspective, net securitizations prefer tax. decrease, debt per it in we down versus September Despite said to turns in share $XX.XX is leverage at basis NAV distributions general, $X.XX principal This excise BDC XX, outlier notes. to basis. cash includes than paying on a were unusually now sector. to equity to increased by decreased XXXX, a X.XX the and a

I leverage with to turns the net X.XX to additional weeks just terms GBDC's quarter. average is assets, for the the the happened quarter increase mentioned tailwind leverage net turns. be will As net of largely in leverage was X.XX an X.XX respect earlier, last target few in Increasing further, profitability. during our

per distribution in total QX a a share quarter. of per of Let's The $X.XX quarterly the turn Board declared supplemental $X.XX to regular distributions and distribution declared distributions, fiscal $X.XX share. of

GBDC's on Adjusted annualized per distribution exceed distributions to NAV company's as coverage XXXX. correspond XX, quarterly regular per of these in XX.X% the based share continues of XXX%. regular distribution NII of dividend Taken together, share September to significantly an yield resulting

in be XX, installments special on December of XXXX. of in June as The will paid of record share In X, board of paid per $X.XX distribution additional merger to addition, declared the equal special final $X.XX X on June XXXX, share XX, stockholders be distributions November our per XXXX, XXXX. for close following

the fiscal going supplemental more about presentation and detail Chris? earnings of provide Slide find on QX Chris our can more to the dates record framework results. dates on and to XX. I'm to distributions turn on Slide now about for You information distribution variable payment over XX it the

Matt. Thanks,

the prior the [indiscernible] decrease to $XX.XX, share share losses X. net value $X.XX Net quarter. over $X.XX of share. realized the were out was per per $X.XX the per to Turning and per drove share down asset Share Slide from per during these a paid quarter. share unrealized results dividends $X.XX Together, below

bottom in portfolio rate decreased predominantly looking size investments at slide, new modestly And one-stop middle shown the the average financial loans. Net the the XXXX. XX, by results of increased through representing funds the start summarizes which for Let's a for GBDC's total the quarter growth go in XX, origination investments We'll activity The XXXX. XX, the on September ended of new asset on XX.X%. quarter-over-quarter $XXX mix our the versus of of increase million, slide details Slide quarter-over-quarter June X% now remain weighted quarter. to

continue be below originations We middle overall the Golub repeat market loan-to-value borrowers. Slide amount disproportionate Capital's these for selective shows during as to GBDC's on portfolio a quarter mix. highly the average XX originations of with was XX%

portfolio the to see, an that shows can at with breakdown by by average GBDC's fair you represent approximately of the with remains diversified remained investment continuing XX As XX of around portfolio XX% portfolio size loans highly basis company points. consistent type value. Slide portfolio one-stop investment quarter-over-quarter

and Additionally, portfolio top of portfolio. the our largest single just the XX% represent largest borrower represents XX borrowers just of X.X% our

to in We cycle. in modulating will of credit size GBDC current context the believe well continue and important through believers credit position in cycles previous has are big which risk the served we be

to senior GBDC's resilient XXXX, drivers the secured economic Slide XX of consisted first of industries. lien across net on of a to believe The spread X.X%. borrowers September XX, in diversified to of change we As loans be investment XX% floating range analysis investment the rate portfolio what highlights of

to due extent, If and quarters income as investment as includes this our impact start lesser dark detail. of walk rates yield reduced XX slide discount the fees yield, in as XX%, amortization we compared quarter, spreads sequentially a recent a with blue interest-based reminder, investment which income the the points and, income amortization basis the fell investment through Let's lower September. and line, the in is the investment yield discounts. GBDC's of to primarily to well over to impact prior as moderating of

of cost X.X% GBDC's line, post-merger call we as costs. we detail saw assumption Our funding funding fuel reduce the X to of the executed multifaceted later points already the a increased XX debt the how facilities. debt debt, plan full Matt basis in quarter to of GBDC impact will

basis XX result, X.X%. investment a average our points the decreased As net spread, weighted line to sequentially gold

We the requires interest during Additionally, us rate funding a that by we the prior of existing fair of our value to net over expense fair recognized to interest accounting a interest noncash GBDC swaps basis with zero GBDC's in to periods, represented the debt. the of have and XXXX XXXX to floor weighted value this changes is through calculation believe on net important expense with associated on and quarter decrease positioned cost the from excluded over of our value rates. I'll to our with declining swaps interest rate XX% Hedge are lives total interest swaps. the rate net the marking the in of notes. rate quarterly fair But life recognize Since and fair in will a value expense. of exposure debt swaps. Consistent any the that recognize is these the over swap noncash it's now. zero change back amounts interest floating well we for to turn to related hedges Matt will average nearly

Thanks, Chris.

XX to XX, XX in increased is remains solid. points the and on and performance XX internal modestly GBDC's credit fair quality debt take investments look of trend by metrics. nonaccruals investments. a can see to at headline closer value. Slide on On Slide X.X% ratings move shows total Slides XX The basis credit that Let's the at you sequentially

is performing low, X of value. of expected loans credit investments at which portfolio and than are underwriting. are X, As rated rated of which they're were or significant proportion very fair most believe better The X, X remain GBDC's the see approximately XXXX, of to expected XX, the XX.X% at we or likely loans impairment which means X.X% September as

early XX, to debt term at relative Recall GBDC's structure. on new which levels other notes opportunity level points, pricing September XXXX, In period $X.X certain usually of going In we're regarding borrow that plus meaningful billion funding our we corporate higher-cost As and These past the announced merger, of to SOFR priced basis XXX GBDC secured revolver. This attractive of a GBDC's securitization the attractive securitizations. includes structural provide financial terms more skip X-year legacy full to with dividend elected November, AAA and history GBDC's we announce Slide time at actions CLO underlying debt a very some we pricing, XX with detail XX. of took to slides funding. XX with have metrics. Slide the under in subsequent conjunction we the reinvestment the a GBDC's improvements a post-merger do, drive we flexibility. repay statements, the to we discussed key describes that

GBDC notice Debt we Additionally, issued XXXX[indiscernible] a XXXX. XX, of December full redemption to redeem on the in securitization

billion sector, has As the a again the repaid also GBDC's while the note, an structures believe funding debt the with all GBDC ladder. funds debt announced We on of meaningfully in cost will to terminated. X increase X-month of was its JPMorgan debt BDC funding the $X.X and GBDC of in maturity basis credit this lead SOFR cost the extending the lowest outstanding facility combination these were lower credit plus XXX XDB initiatives and we of of meaningfully securitization size and facility amounts facility Further, pricing points.

actions the GBDC's XX, We GBDC rate to XXXX the full expect structure benefit these recognize Slide and funding other takeaways. run details in key XX March quarter. of

not we were out the to Our us position collateralized XXXX me weighted X.X%. David form David? and exposure. a and from funding weighted subsequent to funding swapped it unrestricted meaningfully back debt just corporate over over end fixed as reduce total $X.X you've issued with now to remarks on revolver, our funding average unused you liquidity provided XXXX. of this and XXXX of liquidity with describe, of upcoming our notes coupon revolver is of occasions, of due going maturities prior to spot Q&A. of funds by hand unsecured in in or quarter The are And remainder our heard notes rate coming closing that average say rate with for expected XX% floating the no the cost of undrawn unsecured them on GBDC's floating for commitments or did actions The heard and expect in remained adviser. I'm debt XXXX quarter was ended to we time, billion the cost cash, X.X%, quarter over took we is we strong, debt as approximately GBDC's floating. Overall, GBDC's

Matt. Thanks,

So to respect with the line for to open our sum quarter talked spreads up, credit generally GBDC I'm we last then had fourth to going and XXXX. in We a and questions. fiscal quarter strong I a good origination. and headwinds GBDC want wrapped with would that up anticipated face to about market outlook, a few the end

largely is on X briefly touch each of today view I Our to want areas. but unchanged, these

let's about our talk First, outlook credit. for

been And couple about past us. are years, here, credit how see it's quarter expecting the that of For stress. we signs been more said last to around I talking we've have the all

and estimates see now it market, annualized. That's firms is of agencies credit from X% average. in are can see reports in rating liability You and more can running BSL north today long-term for the than the at that the default for it transactions rate S&P restructurings management major from major bankruptcies. also like adjusted the LSTA law covering Fitch and double We

outperformed case I'm this will is this think in successful more thing. Golub are some lender-friendly. borrower to markets, of who've increased should more term. long tourists you. stress which cause market something the we're entered lending, where out surprise should it X, challenging going more We a pretty the friendly be conditions direct chase cycle but these shift may the now, say credits, characteristics they and of credit be And is underperforming from Capital to Now quite to that many of good lack has to the consistently confident defaults,

loan spread correct. We've over I it's market also with pronounced been not million our striking most The segment where saw $XXX private segment. We competitors as market, in documentation middle activity spread has but leverage, the trends headwind we're a out, second a uncertainty, continuing the wider is the tailwinds it focus. M&A but to to borrowers seen rates, to among lenders in point focus. of core our middle proven now think interest core compression. syndicated to return have The be year, compression do to the on shift number a we wasn't XXXX, market. the these large pickup. of see large EBITDA, sponsors this The terms pickup XXXX. lower in less last a immune compression going in We on M&A for LPs, broadly spreads. we quarter large and not market political see to call what market in And talked prepare pickup PE this about to pricing, falling Let's money pressure credit XXXX. from dynamic better spread activity all focus are I experienced

M&A it's to signs cycle, of think we an predict early I but improving seeing activity. super are

we outperform. at a identifying We're Golub good a in positioned lot wrong these good coming here's better course the of This After in what borrowers going we predictions the several all, very anticipate spend resilient set news. to period Capital So in we may And signs wrong conditions XXXX. Having over been market well. does see bring, Whatever of are that of to we're is think improve happens industries. that complementary sum, want on a to things we conditions this. because on all minute the headwinds, well across GBDC that, think consensus the resilient X if are of and is last years. have I said

us and sponsor-backed relationships make Our for attractive companies. incumbencies preferred partner a

that, depth managing preserve and and us on our us enable early address and great the credits these for We've be identify call arise over effort. questions. we that of expertise with line our the of built Our me in problem advantages value. helps investment time competitive year, issues process that with is XXth anniversary protocols good to we're what let great open proud XX to intent board. With This years and celebrating

Raymond with from of And line Robert first Dodd our Instructions] [Operator James. question comes the

spreads through mean What et of and I I and cetera. best of some scale reach questions you're anymore, et of think terms mean, is the weaker else worst went that I definitions, on definitions -- credit Matt EBITDA everything and I around I down obviously, other in , Because go spreads terms see the the to structures -- mean, don't then document where that things but to mean at across cycles? [indiscernible] David, starting like of swings and cetera, that. low weekends then and X mentioned, point. you about, way seeing spreads

say we are you the would it. in not like of where with that all the spreads, So go bits just cycle other but

question, Robert. Good Sure.

particular So a I about in market thinking in be documentation segment. context also in important about think to of it's terms the talking

and particular, middle have of if more against have And there's back there's think terms. In way we the other an against the we strong typically where in we market very market leakage we We market, meaningful this compete pretty in market see covenants. borrower-friendly come the in to more typically in move more versus So strong we documentation We credit syndicated lender-friendly typically strong. definitions as terms. Today, from terms. is movement in always documentation documentation core XXXX. to EBITDA. market, have market, lenders difference a large enormous market In protections the a in various larger an core syndicated market about a has [indiscernible] broadly . broadly variability It middle the of thing strength private called

to to that a credit a market. in to and private we've of of think credit the financed very the loans broadly also borrower-friendly. lenders market, syndicated to documentation private loans of threat right, refinanced called. come the has private been And the that back. to and which new It's agree market. people and are Last it has more vocal in market were overhyping credit the lot improved of private terms market year, credit depth to agree were caused I was repricings that the broadly going the that was was syndicated prematurely relative syndicated broadly growth I to

levels, terms side spectrum large they're been on would side. at middle characterize ever I on of the Robert, core market. that and XXXX the the being to we've today, core the focused more market borrower sticking that's So than documentation the X but on borrower-friendly quite not as on focus of relatively our friendly reasons, They're

the behind color. XXXX. -- that not of cycle -- I'm 'XX, appreciate stronger rank? super market where not meaningfully you're be it push than you are color 'XX, label do to -- what point on in XXXX, it 'XX, mean you're XX? expect that to on what the calling mean, going of I you take I clearly Or is and What are another just Or would takes I in to would of like XXXX a because the you seeing be you take -- for to it And but kind seeing it. terms would things yet? put clearly where the do

mark volumes question are XXXX now. right M&A a So,

headwinds. channel the the well as as both about talk wins Let's

the On have side, somewhat we tailwind rates. lower

We have lower spreads.

that political/policy got money. the proceeds to who less private yet equity uncertainty have investors. to gone of on to equity continuing enough private continuing pressures we've their And disposition current the on more have We second set deliver elections spend somewhat their have firms a of not got firms now pressure spent We've funds through.

tailwinds that significant some are there very really think are recognized powerful. I So

On have a lot of uncertainty. still the headwind we side,

of catalyst with about the Ukraine you what as uncertainty to more a in on on as certainty days a of there effect in question for significant taxes, more go I what more where be activity to a think the are to leads is activity? There's know activity. there in more M&A Woolworths. turn, last comes going few clearing lot are M&A is highlighted market developments on to levels tariffs, going the that, bit Robert, levels to we M&A in going have to geopolitical and spending Because the don't snowball what's where happen, price that tends be, things

XXXX. we're I'm saying going table But sure. And see right going pounding M&A too we not early early XXXX. have think the in to it's year may So in hope super not M&A now a that it's I'm I to not do. to I to We make to saying, too -- an call. cycle big I'm think I saying be we're

with more, you've One side balance if credit mean you the done CLOs, the [indiscernible] On lot work end. I the it. a facilities, post sheet can. cetera. et on Got I the quarter But of secure

be on DC for -- the in down secured, they're would you there's to borrowers, view well would the Are done mean, say you the obviously, secured characterize that? borrowers unsecured? side -- how still of would the you're just of positioning? spreads the work a as with the you side, a So we for terms of SL so done years the obviously down or visited structure I thoughts one but on unsecured in -- on the how done after Or aren't spreads take liability with on you any couple of

core in lot balancing that of This that the done never and competitive we're the balance We're sustaining point, we're Right sheet. We're of Look, I low-cost your right-hand is of something to Golub now, at a GBDC's work have done a think it. a good flexible time balance we of side optimizing good terms advantage sheet. on Capital. doing is at over it. on

We we company. the costs borrowing merger time have take a of post-merger gotten the that point, of lot the the at talked about reducing respect I of benefits But your in the to of keep and looking I for to secured it's attractive unsecured. both spectrum, job of take think opportunities to seeing to our advantage on And debt opportunities new across GBDC we're put for the that. combined

the Johnson with KBW. of next line comes [Operator Paul question Instructions] And from your

of $X just quarter. much billion a well trying and whether for the into here deploy mainly ask, little less a of platform up the here, quarter the also platform, GBDC, some today, was mute pricing little if that was instead potentially overall of kind activity this was was for this Apologize of bit deployment Can what on of given next sense to bit originations credit. us favorable towards of on kind across year you environment that better a now the -- cautious strong allocated of quarter, The for year? on give why this or is so a back pull comments of

Thanks, Paul. Good question.

So this. of a across couple of platform. comments We whole deploy on the always

well quarter change that was GBDC. level. a allocation allocations of for aimed merger, Coming GBDC. different. within that, under way that increase we opportunity increasing didn't So recall hoping out said Having is no we the were to leverage our to in you'll an this policy at our assets were We target

would significantly we I just slightly quarter X.X under quarter is finished, we over were our to had and in of just target average leverage over Xx X.XX. argue, We an leverage the target the fact, our level. In still

total bit overstated I'd is repricing sense there some make point commitments entry and the new a is in simultaneous Second refinancing, exit that the is activity. that investment little

the focus normal-looking which pretty $XXX million, the So more to I a tend on is eye-popping not the funds number. all. It's net an number growth at number,

of giant equity The third our and some our relationships while point those very new through origination X sponsors we it's existing origination environment quarter are disproportionate advantages all portfolio. And both our have borrowers. I'd origination make of in from last sponsors portion was our of of was with repeat those normal a and is with advantages standpoint, from repeat that private and new really challenging a this giant shown Almost a

sponsors expertise So period our on advantages that we're focusing and and borrowers we in. this during and leaning competitive on industries really have in

way markdown? and quarter. was noncash just related to interest the swap interest expense this noncash possibly Is helpful X basis expense that's what that -- any the very swap share Chris, quantify of kind of then that. answered a and the to on the on Appreciate result It's for of per there

It about about. $X.XX was a Paul, it was share.

your with Capital. line of question from Anfield next comes Ray the And Cheesman

anything it competition X yield. Or Was the bank is The I'm other due the decline down? rather mean, first was in did as seeing mostly now that aggressively it in credits, repricings -- the here. to you where I spread was forced

a So factors. I it's of would say combination

large larger of the in side market borrowers. seen have We portfolio, the our

some We described, where repricings that place. have you seen take movements, they're as

it can has compression on see been been of Page is on loans talking in and presentation, -- the spread average quarters, that than spread prior we've you also reflecting the it new the weighted that lower about. We XX

I variety over over the third of the coming floating a manage more to -- to all mentioned, it's rates. is we see factors. we're rate declining which course the are see of of going all assets were period base more A of So one going

it's all X of So those.

that be, considering sites going started X Second simply -- would your and the experience kind I behavior toys creditors seeing with better anywhere usually else the way say, and try outcome. would mean up packing hope. repeat their not I mean get with home usually, I work you of of our and his sponsors I the proceeded to think portfolio, in you're a sponsor a

a of our always And there's reactions sponsor we to good clients. with So have range situations. sponsor dialogue workout

the involve we've continuing Our going first win-win with any a toward not work solutions period, position different. a so with any run keys sponsor. benefits [indiscernible] done, the in and take to number sponsors of that to to the continuing content it's that Ray, this a to Is they're quite contributions to we're this if and and been But and that -- sponsor reasons, to for be concludes something current don't think I always period coming coming situation. That's of do

the in are our is, Or will pile we're for or make current there, this because inside your side leverage you environment vehicles their fund general, opinion, of continued positive way are cost for in a or going either of good X operations think in? any that bigger on we you the GBDC is eventually get side larger do we'll be size to additional just into better? Last for

always in areas where have with portfolio generally, At satisfied I'm more very pleased grow I'm very right advantage us competitive years. to expertise opportunities Capital, consistent we see areas where very now I GBDC. for have the to that for right in looking been XX now. of in the strategy. we opportunities Golub we're for It's strategy grow

specialty in anticipating our finance to So anticipating, subsidiaries in unrelated any That's announce areas competitors I'm some investments I'm of not example, in not major in for changes. our MO. coming not done that. we're have that going days, as

question end which you GBDC will GBDC a up No, really, there is public? was the X, in think eventually

after a called it's filer, have your time you GBDC. private X. I GBDC it liquidity for do a matured, at potential X, look merger a it. a it's will options will possible at We misunderstood GBDC come including to Sorry, there public look question. sense can that And BDC It's where make with

be were the you you size something instead [indiscernible] now that billiojn, think is you optimal an to be $X is If environment of are that advantage for in $XX in Or size billion which would today's marketplace? the do

appropriate Golub the about of making that before are We're that as really the deploy and have about we're not that's sure GBDC. a we focused best can. We're on that of all specifically not in money not platform raising not that it I as very a for think and in we're across we we then opportunities us and management. size asset Capital believers then the best as model and can of business deploying it So raise money

that for to of think we across too the mortgage of right of without it's dry powder. but X having a dry So GBDC, too questions is much a level in powder Ray, and what's dry powder advantage just conditions develop lot, about question the platform take little either order the or not to Golub

Instructions] [Operator

anything for if thank questions. Thanks to their anybody else I out. to want everyone for as usual, reach free feel and And today. they today about, talk like attendance to coming has would please their

Thank This concludes today's call. you for all joining.

now may You disconnect.