Net Asset Value & Publication of Monthly Report

Marble Point Loan Financing Limited

27 August 2024

 

27 August 2024

The net asset value ("NAV") of Marble Point Loan Financing Limited ("MPLF") as at the close of business on 31 July 2024 is as follows:

Share class	July 2024 NAV per Ordinary Share (1)	June 2024 NAV per Ordinary Share (1)	Monthly Change in NAV per Share (1)
Ordinary Shares	USD 0.5045	USD 0.5274	USD (0.0229)

Performance

·      MPLF's ordinary share estimated NAV total return was (0.09%) in July, compared to the total return of the Credit Suisse Leveraged Loan Index ("CSLLI") of 0.73%.

·      Secondary loan prices stayed rangebound in July as investors digested economic data and limited new loan supply continued to provide technical support alongside strong CLO formation.

·      Quarterly distributions received by MPLF from its portfolio holdings totaled approximately $13.4 million in Q3 compared to $8.9 million in Q2. Most reinvesting CLOs saw distributions remain in line with April figures, while several post-reinvestment period deals cured failing coverage tests that had previously caused cash flow diversion and resumed distributions.   In addition, new CLO equity investments made in Q4 and Q1 made their first distributions in July, boosting the aggregate fund amount to the highest quarterly total since inception.

·      As at 31 July 2024 MPLF had no exposure to Rodan & Fields, the sole constituent of the Morningstar/LSTA Index to default during the month.  The index's lagging 12-month default rate by notional amount remained unchanged at 0.92% at 31 July as other defaults rolled off the calculation. 

Market

·      The CSLLI delivered a 0.73% total return in July as monthly interest accruals in the higher interest rate environment delivered consistent current income.  Loan markets had retreated at the end of June as retail investors digested moderating inflation reports and the potential impact on interest rates, but ground higher throughout July amidst strong CLO demand. 

·      Headline primary loan issuance declined to $34.6 billion in July from $54.0 billion in June, however the decline was mostly attributed to a lower number of refinancing deals.  Refinancing transactions represented over 50% of issuance in the first half of 2024 yet were less than a third of the July figure.   Loan repricing amendments declined in July from the record setting activity in May and June, yet still registered $48.3 billion processed during the month.  Amidst this activity loan spreads continued to compress with the Morningstar/LSTA Index average spread tightening another 2bps during the month.  While net loan supply has remained flat during the year, the trailing three-month total of M&A driven activity hit its highest YTD level in July, indicating more organic supply has rolled through in recent months.

·      Despite the healthy demand and market support for higher quality assets within the broader loan market, the stressed segment of the market remains elevated.  At 31 July, the share of loans in the Morningstar/LSTA index that had bid prices lower than 80% was 4.41%, only marginally lower than the 4.54% figure at the end of 2023.

·      The average indicative bid price of the Morningstar/LCD loan index increased to 96.60% at 31 July from 96.59% at 30 June while the weighted average indicative bid price of MPLF's underlying loans decreased to 96.38% at 31 July from 96.56% at 30 June. 

·      July CLO issuance totaled $13.2 billion across 29 new issue CLOs, slightly below the YTD monthly average of $16.4 billion as issuers remained more focused on refinancing and reset transactions of existing vehicles.  CLO reset and refinancing volume during the month were $20.6 billion and $8.0 billion respectively, the second highest combined monthly reset and refinancing volumes year to date. 

·      Retail loan funds experienced an aggregate inflow of approximately $2.7 billion in July according to J.P. Morgan.  While this supported loan prices during the month, daily flows turned negative at the end of July as interest rate expectations shifted and investors pivoted away from floating rate funds.

·      Since the end of July the average indicative bid price of the CSLLI has declined by 0.09% to 95.64% (as at 22 August 2024).  Retail outflows pressured loan prices earlier in August as investors digested weaker equity markets and increased recession concerns.

Investment

·      As previously reported, during the month Investcorp priced and closed a reset of the Marble Point CLO XVII transaction in which MPLF hold $19.55mm notional of the equity tranche.  The reset includes a new five year reinvestment period while refinancing all classes of existing debt, tightening the weighted average cost of debt by approximately 16 basis points from S+213 to S+197. 

MPLF's July 2024 Monthly Report is available on its website: www.mplflimited.com 

Enquiries:

Marble Point Loan Financing Limited

Investor Relations

T:  [phone]

E:  [e-mail]

Website: www.mplflimited.com 

Corporate Broker:

Stifel Nicolaus Europe Limited

T:  [phone]

 ⁽¹⁾ NAV figures are provided for informational purposes only and are unaudited, estimated by Marble Point Credit Management LLC ("Marble Point"), the investment manager of MPLF, and subject to adjustment. Marble Point estimates MPLF's NAV on a monthly basis as at the end of each month. Estimates with respect to a date falling on a calendar quarter end are subject to revision when the quarterly NAV is determined. NAV is calculated as the sum of the value of MPLF's investment portfolio, any cash or cash equivalents and other assets less liabilities. NAV is reduced by the amount of a dividend to the extent the ex-dividend date occurs during the period presented.   NAV total return figures shown are estimated, unaudited and subject to adjustment and reflect the net total NAV return, inclusive of dividends, for the periods shown and as from MPLF's admission to the Specialist Fund Segment of the main market of the London Stock Exchange on 13 February 2018, after taking into account applicable listing and offering costs and pre-admission profits and loss. Monthly and cumulative performance figures are non-annualised and such results reflect the deductions of applicable management fees and expenses at the underlying investment levels.

⁽²⁾Figures shown for effective yield are estimated, unaudited, subject to change and based on the analysis of Marble Point Credit Management LLC, the investment manager of MPLF, as at the Closing Date.  The estimated effective yield is provided for illustrative purposes only.  The actual effective yield, as recorded by MPLF or other entity holding the investment may vary over time.

Past performance is not indicative or a guarantee of future performance.

This release contains inside information.

About Marble Point Loan Financing

Marble Point Loan Financing Ltd. (LSE Ticker: MPLF LN (USD); MPLS LN (GBX)) is a Guernsey-domiciled closed-ended investment company. MPLF's investment objective is to generate stable current income and grow net asset value by earning a return on equity in excess of the amount distributed as dividends.

MPLF is invested in a diversified portfolio of US dollar denominated, broadly syndicated floating rate senior secured corporate loans owned via collateralised loan obligations ("CLOs") and related vehicles managed by Marble Point Credit Management LLC.

About Marble Point Credit Management LLC

Marble Point Credit Management LLC ("Marble Point") is a specialist asset manager focused exclusively on leveraged loans.  Marble Point is 100% owned by Investcorp International Holdings Inc. ("IIHI"), which is part of the Investcorp Group of companies. The Investcorp Group effectively operates as a management-controlled group, substantially all whose assets and operations are owned and controlled by Investcorp S.A., a company domiciled in the Cayman Islands.   Investcorp Holdings B.S.C. ("Investcorp") a Bahrain based holding company is the parent company of Investcorp S.A. ("S.A."). Certain of the Investcorp Group's directors and senior executive officers have the ability to indirectly control Investcorp S.A.

IMPORTANT INFORMATION

Marble Point Loan Financing Limited (the "Company") is a closed-ended investment company incorporated in Guernsey with its ordinary shares ("Shares") admitted to trading on the Specialist Fund Segment of the Main Market of the London Stock Exchange (ticker: MPLF.LN). The Company is invested in a diversified portfolio of US dollar denominated, broadly syndicated floating rate senior secured corporate loans via CLOs, loan accumulation facilities and other vehicles managed by Marble Point Credit Management LLC ("Marble Point") or its affiliates. Marble Point is an investment adviser registered with the U.S. Securities and Exchange Commission.

This document is provided for informational purposes only and does not constitute an offer to sell any Shares, notes or other securities (collectively, "Securities") issued by the Company or a solicitation of an offer to purchase any such Securities in the United States, Australia, Canada, the Republic of South Africa, Japan or any other jurisdiction. This document may not be relied upon, and should not be used, for the purpose of making any investment decision. This document and the information and views included herein do not constitute investment advice or a recommendation or an offer to enter into any transaction with the Company or any of its affiliates. Any recipient of this document should make such investigations as it deems necessary to arrive at an independent evaluation of any investment and should consult its own legal counsel and financial, actuarial, accounting, regulatory and tax advisers to evaluate any such investment. This document has been issued by the Company and is the sole responsibility of the Company.

The Securities have not been and will not be registered under the U.S. Securities Act of 1933, as amended, or with any securities regulatory authority of any state or other jurisdiction of the United States and may not be offered or sold in the United States to, or for the account or benefit of, U.S. persons unless they are registered under applicable law or exempt from registration. The Company has not been and will not be registered under the U.S. Investment Company Act of 1940, and investors will not be entitled to the benefits of such Act.

The information shown herein is estimated, unaudited, for background purposes only, representative as of the dates specified herein, subject to adjustment and not purported to be full or complete. Nothing herein shall be relied upon as a representation as to the current or future performance or portfolio holdings of the Company or any strategy or investment vehicle. Certain information presented herein has been obtained from third party sources and is believed to be reliable. However, neither the Company nor Marble Point represents that the information contained in this document (including third party information) has been independently verified or is accurate or complete, and it should not be relied upon as such. Index information, if any, has been provided for illustration purposes only. Any such information does not reflect the effect of transaction costs, management fees or other costs which would reduce returns. An investor cannot invest directly in an index.

There is no guarantee that any of the goals, targets or objectives described in this document will be achieved. The investment strategies of the Company may not be suitable for all investors and are not intended to constitute a complete investment program. Neither Marble Point nor the Company makes any representation or warranty (express or implied) with respect to the information contained herein (including, without limitation, information obtained from third parties) and each of them expressly disclaims any and all liability based on or relating to the information contained in, or errors or omissions from, these materials; or based on or relating to the use of these materials; or any other written or oral communications transmitted to the recipient or any of its affiliates or representatives in the course of its evaluation of the information herein.

Any of the views or opinions expressed herein are current views and opinions only and may be subject to change. Statements made herein are as of the date of this document and should not be relied upon as of any subsequent date. All information is current as of the date of this document and is subject to change without notice.

Past performance is not a reliable indicator of current of future results. The value of investments may go down as well as up and investors may not get back any of the amount invested. The value of investments designated in another currency may rise and fall due to exchange rate fluctuations in respect of the relevant currencies. Adverse movements in currency exchange rates can result in a decrease in return and a loss of capital.

A Note on the Use of Indices as Benchmarks. The indices shown have not been selected to represent a benchmark for MPLF's performance, but rather to allow for comparison of MPLF's returns to those of known, recognized and/or similar indices. The Credit Suisse Leveraged Loan Index (CSLLI) tracks the investable universe of the U.S. leveraged loan market. The ICE BofAML US High Yield Index (ICE BAML HYI) tracks the performance of USD-denominated below investment grade corporate bonds publically issued in the U.S. domestic market. The Standard & Poor's 500 Index (S&P 500) tracks the performance of U.S. public equity markets and is based on the market capitalization of 500 large companies having common stock listed on NYSE or NASDAQ. The performance of any index is not an exact representation of any particular investment as you cannot invest directly in an index.

A Note on Forward Looking Statements. This document includes forward-looking statements. Forward-looking statements include all matters that are not historical facts. Actual results may differ materially from any results projected in the forward-looking statements and are subject to risks and uncertainties. Such statements are based on current expectations, involve known and unknown risks, a reliance on third parties for information, and other factors that may cause actual results to differ materially from the anticipated results expressed or implied by such forward-looking statements. The Company and Marble Point caution readers not to place undue reliance on such statements. Neither the Company nor Marble Point undertakes, and each specifically disclaims, any obligation or responsibility, to update any forward-looking statements to reflect occurrences, developments, unanticipated events or circumstances after the date of such statement. Actual results may differ materially from the Company's and/or Marble Point's expectations and estimates.

None of the Company, Marble Point or any of their respective parent or subsidiary undertakings, or the subsidiary undertaking of any such parent undertakings, or any of such person's respective partners, shareholders, directors, members, officers, affiliates, agents, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any information or opinions presented or contained in this document nor shall they accept any responsibility whatsoever for, or make any warranty, express or implied, as to the truth, fullness, accuracy or completeness of the information in this document (or whether any information has been omitted from the document) or any other information relating to the Company, Marble Point or their respective subsidiaries or associated companies, in any form whatsoever, howsoever transmitted or made available or for any loss howsoever arising from any use of this document or its contents or otherwise arising in connection therewith. This shall not affect any liability any such person may have which may not be excluded under applicable law or regulation.

 

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