neuberger berman high yield bond fund - beconim › fundspdf › neuberger berman › fixed... ·...

For Professional Client Use Only

Neuberger Berman

High Yield Bond Fund October 2018

MORNINGSTAR RATINGTM as of 30/09/2018

Table of Contents

I. FIRM OVERVIEW

II. INVESTMENT PHILOSOPHY AND PROCESS

III. PORTFOLIO STATISTICS

IV. MARKET OVERVIEW

APPENDICES

A. INVESTMENT TEAM

B. ADDITIONAL INFORMATION

C. DISCLOSURES

FIRM OVERVIEW

Employee-Owned Investment Manager

Partnering with clients to achieve their unique objectives

Long-term Outperformance2Alignment of Interests

Portfolio managers invest alongside clients

Breadth of Independent Perspectives

601 investment professionals1 connected across public and

private markets, equity, fixed income and alternatives

Experienced and Stable Teams

25+ year average industry experience for lead PMs; 96%

annualized retention rate of senior investment professionals at MD

and SVP level since becoming an independent company in 2009

Innovative Investment Solutions

A track record of client partnerships and long-term performance

90%Institutional-oriented equity

Percentage of institutional-oriented AUM outperforming

benchmark since inception ended June 30, 2018

95%Institutional-oriented fixed income

Percentage of institutional-oriented AUM outperforming

benchmark since inception ended June 30, 2018

74%

Private equity

Percentage of NB Private Equity funds raised between

2005 – 2015 (since inception performance)

outperforming benchmark Net IRR

Deep Resources

Extensive fundamental research, access to management,

innovative ESG research, and sophisticated risk management

1. As of August 31, 2018.2. Institutional-oriented equity and fixed income assets under management (“AUM”) includes the firm’s equity and fixed income institutional separate account (“ISA”), registered fund, and managed account/wrap (“MAG”) offerings and are based on the overall performance of each individual investment offering against its respective benchmark. High net worth/private asset management (“HNW”) AUM is excluded. If HNW AUM were included, the percentage of AUM outperforming the benchmark since inception period would have been 75% for equities and 84% for fixed income. Equity and Fixed Income AUM outperformance results are asset-weighted so individual offerings with the largest amount of assets under management have the largest impact on the results. Please see additional disclosures for important information regarding Private Equity methodology. All performance data for NB Private Equity funds, public and private indices data is as of December 31, 2017. Results are shown gross of fees. Individual offerings may have experienced negative performance during certain periods of time. See Additional Disclosures for additional information regarding the outperformance statistics shown (including 3-, 5- and 10-yr statistics for institutional-oriented equity and fixed income). Indexes are unmanaged and are not available for direct investment. Investing entails risks, including possible loss of principal. Past performance is no guarantee of future results.

4

Employee Ownership Fosters Team Stability and Alignment with Clients

Industry-leading experience, retention and culture

1. Employee assets include current and former employees and their family members.

of clients’ assets managed by

lead PMs who have 20+ years

of industry experience

Manager Experience

Retention Levels For Senior Investment Professionals

Managing Directors

(includes retirements)

Managing Directors

(competitor departures only)

98%

98%

99%

91%

94%

100%

99%

100%

99%

100%

2013

2014

2015

2016

2017

93%

Alignment With Clients

invested by Neuberger Berman employees

alongside clients1~$3bn100%independent,

employee-owned

Ownership Structure

deferred cash compensation directly linked to team

and firm strategies100%

Our Culture

2013 2014 2015

2016 2017

5

https://www.google.com/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&uact=8&ved=0ahUKEwi4nP-UvfrLAhXCJh4KHTelByYQjRwIBw&url=https://www.trsretire.com/industry_awards.jsp&bvm=bv.118443451,d.dmo&psig=AFQjCNFS3swgy264EL-T9uAUy7LzUMo8Og&ust=1460048075527346

Investment Platform

Breadth of independent perspectives across asset classes

1. As of June 30, 2018. Firm assets under management (AUM) includes $103.3 billion in Equity assets, $132.2 billion in Fixed Income assets and $68.9 billion in Alternatives assets. Alternatives “AUM and Committed Capital” includes assets under management for non-Private Equity businesses and Committed Capital since inception for the Private Equity businesses. Committed Capital since inception reflects all contractual commitments, including those still in documentation, to fund investments, including those which have since been realized, advised by NB Alternatives Advisers LLC and its affiliates or predecessors (the oldest mandate of which was founded in 1981).2. As of August 31, 2018.

EQUITY FIXED INCOME ALTERNATIVES

AUM $304bn1

Investment

Professionals2

$103bn

228

$132bn

176

Risk Parity

Global Tactical Asset Allocation

Global Relative & Absolute Return

Income Focused

Inflation Management

Liability Aware

$77bn AUM and Committed Capital

152

Quantitative Global

U.S.

Emerging Markets

Custom Beta

Risk Premia

Options

Global Macro

Commodities

Fundamental Global Investment Grade

Global Non-Investment Grade

Emerging Markets, Regional EM, China

Multi-Sector, Opportunistic

Municipals

Specialty Strategies

– CLO Mezzanine

– Currency

– Corporate Hybrids

Private Equity:

– Primaries

– Co-Investments

– Secondaries

– Specialty Strategies– Minority stakes in

alternative firms - Dyal

Alternative Credit:

– Private Credit

– Residential Loans

– Special Situations

Hedge Funds:

– Multi-Manager

– Equity Long/Short

– Credit Long/Short

– Event Driven

QuantitativeFundamental

MULTI-ASSET CLASS SOLUTIONS AND STRATEGIC PARTNERSHIPS

Integration of Environmental, Social and Governance Factors

Global, EAFE

U.S. Value, Core, Growth

Emerging Markets

Regional EM, China

Global Thematic, Disruptive Themes

Sustainable Equity

Income Strategies

– MLP

– REITs

6

Fixed Income Organization

Supported by over 150 US and Global Money Managers, Research Analysts and Associates

As of July 31, 2018Combined investment professionals of the firm and affiliated investment management entities.*As previously announced Andy will be retiring at the end of 2018 and will transition his portfolio management responsibilities to a group of senior portfolio managers across Global Investment Grade and the Multi-Sector Fixed Income Group. Given our team-based approach, each account will continue to be managed by portfolio managers that have a deep understanding of each portfolio and the client’s unique objectives.**As of May 25, 2018, it was announced that Martin Rotheram intends to depart the firm. Martin will work with the members of the investment team to ensure an orderly handover of his credit responsibilities over the next six months.

GLOBAL FIXED INCOMEBRAD TANK

EMERGING MARKETS DEBT

ROB DRIJKONINGEN

GORKY URQUIETA

Hard Currency

Bart van der Made

Local Currency

Raoul Luttik

Corporates

Jennifer Gorgoll

Nish Popat

Research

Puay Yeong Goh

Vera Kartseva

Kaan Nazli

Asian Fixed Income

Prashant Singh

GLOBAL NON-INVESTMENT

GRADE

TOM O’REILLY

High Yield

Russ Covode

Dan Doyle

Patrick Flynn

Joseph Lind

Tom O’Reilly

Senior Floating Rate Loans /

Structured Credit

Stephen Casey

Joseph Lynch

Martin Rotheram**

Pim Van Schie

Research

Chris Kocinski

Steve Ruh

European High Yield

Vivek Bommi

Martin Rotheram**

GLOBAL INVESTMENT

GRADE

DAVE BROWN

ANDREW JOHNSON*

Rates

Thanos Bardas

Anthony Woodside

Credit

Dave Brown

Julian Marks

Bob Summers

Securitized

Jason Smith

Tom Sontag

Currency

Ugo Lancioni

Research

Steve Flaherty

Dmitry Gasinsky

Core/Core Plus

Thanos Bardas

Dave Brown

Nate Kush

Tom Marthaler

MUNICIPALS

JAMES ISELIN

Cash/Short Duration

Kristian Lind

Intermediate

James Iselin

S. Blake Miller

High Income

James Iselin

S. Blake Miller

Eric Pelio

Research

James Lyman

ALTERNATIVES

Global Credit

Long / Short

Rick Dowdle

Norman Milner

Special Situations

Michael Holmberg

Brendan McDermott

Ravi Soni

Residential Loans

Terry Glomski

MULTI-SECTOR

SOLUTIONS

BRAD TANK

Global / US Opportunistic

Strategies

Thanos Bardas

Ashok Bhatia

Dave Brown

Andrew Johnson

Jon Jonsson

Tom Marthaler

Research

David Tang

Insurance Solutions

Jason Pratt

Inflation / Liability Aware

Thanos Bardas

Olumide Owolabi

Ronit Walny

China Fixed Income

Peter Ru

7

Fixed Income Platform Overview

$132bn across a spectrum of investment styles

1. As of August 31, 2018.2. Fixed Income assets under management excludes fixed income assets ($3 bn) managed by equity investment teams and includes alternative credit assets ($5 bn).3. “Lead Portfolio Managers” are defined as those individuals who head a Fixed Income investment team. Percentages are rounded to the whole number. “Additional Investment Professionals” include Fixed Income research analysts, traders, product specialists, and team-dedicated economists/strategists.

• Consistency of leadership: 100% assets managed by lead PMs who have

20+ years of industry experience

• 176 investment professionals with sector specialization; 8 global locations1

• Best in class capabilities across global universe, public and private markets

Breadth and depth of capabilities

• Investment teams share insights and information across a global platform

• Multi-site platform ensures local perspective incorporated into portfolios

• Rigorous risk management framework includes independent oversight

Global integrated platform

• Proprietary tools drive portfolio construction; examples include State Space

analysis, Credit Best Practices (proprietary credit analysis framework), Torpedo

Monitoring (credit deterioration risk management) and Everest (identify, select

and monitor portfolio positions)

Fundamental research driven approach

Global Investment

Grade$51

Global Non-Investment

Grade Credit $40

Emerging Markets Debt

$18

Multi-Sector & Opportunistic

$11

Municipals$11

Alternative Credit

$5

AUM ($bn)

Broad Style Range2

Highly Experienced Managers3

100%

60%

20 Years

Industry Experience

Tenure at Neuberger Berman

Supported by Additional

Investment Professionals

with an average of 13

years industry experience

and 7 years at the firm

10 years tenure at

Neuberger Berman

by AUM

86%

Percentage of client assets under management by experienced Lead Portfolio Manager

8

Global Non-Investment Grade Credit Platform

___________________________1. This material is intended as a broad overview of the portfolio managers’ style, philosophy and investment process and is subject to change. Typical credit quality ranges are provided for reference only and do not reflect any actual credit quality rating

associated with any product or investment.2. Not all investment vehicles are available to all investors or in all jurisdictions. 3. As of June 30, 2018. Includes Alternative capabilities and Non-Investment Grade assets managed within Opportunistic / Unconstrained Strategies. For illustrative purposes only provided for one on one presentation. The observations set forth including portfolio characteristics are neither investment advice nor a legal opinion. They are presented only to provide information on our view of the referenced investment strategies.

Disciplined credit process driven by what we believe to be one of the largest dedicated global credit

research teams

U.S.

HIGH YIELD STRATEGY

QUALITY BIAS

HIGH YIELD STRATEGY

SHORT DURATION

HIGH YIELD STRATEGY

EUROPEAN

HIGH YIELD STRATEGY

GLOBAL

HIGH YIELD STRATEGY

SENIOR FLOATING

RATE LOANS / STRUCTURED

CREDIT STRATEGY

Portfolio Managers

Tom O’Reilly

Russ Covode

Dan Doyle

Patrick Flynn

Joe Lind

Tom O’Reilly

Russ Covode

Dan Doyle

Patrick Flynn

Joe Lind

Tom O’Reilly

Russ Covode

Dan Doyle

Patrick Flynn

Joe Lind

Vivek Bommi

Martin Rotheram

Tom O’Reilly

Patrick Flynn

Vivek Bommi

Jennifer Gorgoll

Nish Popat

Joe Lynch

Stephen Casey

Martin Rotheram

Pim Van Schie

InvestmentsUS $ high-yield corporate

bonds

US $ high-yield corporate

bonds

US $ shorter term high-

yield corporate bonds

European currency high-

yield corporate bonds

US $ and European currency

high-yield corporate bonds;

emerging market bonds

US $ and European currency

floating rate senior secured loans,

CLO debt

Credit focus1

Credit Quality Range

Opportunistic

B to BB

BBB, CCC, senior floating

rate loans

BB

BBB, senior floating

rate loans

BB

BBB, CCC, senior

floating rate loans

B to BB

BBB, CCC, senior floating

rate loans

B to BB

BBB, CCC, senior

floating rate loans

B to BB

BBB, CCC, secured bonds

Typical Maturity 8 to 10 yrs 8 to 10 yrs < 5 yrs 8 to 10 yrs 8 to 10 yrs 5 to 7 yrs

Typical Duration 4 yrs 4 yrs < 2 yrs 4 yrs 4 yrs Floating Rate

Other Vehicles2

UCITS Fund

40 Act Fund

Commingled Fund

CIT

–

–

–

–

–

–

–

–

UCITS Fund

40 Act Fund

–

–

–

–

UCITS Fund

–

–

–

–

–

UCITS Fund

–

–

–

–

–

QIF (Dublin-based)

LSE Listed Fund

40 Act Fund

Commingled Fund

NB Managed CLOs

Third Party CLOs

AUM ($MM)3 $15,794 $1,661 $5,691 $400 $2,498 $16,372

9

Neuberger Berman High Yield Strategy

• Tom O’Reilly, 30 years of high yield investment experience and 21 years with the firm3

• Russ Covode, 31 years of high yield investment experience and 14 years with the firm3

• Dan Doyle, 34 years of high yield investment experience and 6 years with the firm3

• Patrick Flynn, 27 years of high yield investment experience and 12 years with the firm3

• Joe Lind, 19 years of high yield investment experience and <1 year with the firm3

SEEK ATTRACTIVE INVESTMENT RESULTS• $15.8 billion in U.S. high yield AUM (64% institutional, 36% intermediary)1

• Top decile performance over 10-year period2

• High information ratio we believe attests to the effectiveness of the investment team and process

LONGSTANDING INVESTMENT PHILOSOPHY

• Manage a diversified portfolio of below investment grade corporate debt

• Disciplined credit process seeks to mitigate downside risk with upside participation

• Seek to add value by generating moderate tracking error through changing market environments

• Three sources of potential added value: avoidance of credit deterioration, industry and quality rotation and

relative value analysis

EXPERIENCED & STABLE INVESTMENT TEAM

Downside risk mitigation with upside potential delivered by stable investment team

EXTENSIVE RESEARCH CAPABILITIES

• Disciplined credit process driven by, we believe, one of the largest dedicated non-investment grade credit

research teams

• Proprietary “Credit Best Practices” with risk management overlay

• Customized ESG Scoring System leveraging our research team’s deep industry expertise

• Access to NB’s other research platforms including equity, investment grade fixed income, and emerging

market debt_______________________1. As of June 30, 2018, includes sleeve accounts. Institutional includes assets of institutional separate accounts, Neuberger Berman sponsored U.S. registered '40 Act open-end funds held by defined benefit & defined contribution

plans, Neuberger Berman sponsored non-U.S. funds held by institutional clients, and unregistered funds sourced through institutional sales channel. 2. Source: eVestment as of June 30, 2018. Ten year ranking is reflected above. The investment team defines a full market cycle for the high yield asset class as a period of peak defaults and economic contraction followed by a

subsequent recovery (“Full Market Cycle”). Based upon this definition, the most recent market cycle commenced in 2008-2009; the ten year period through March 31, 2018 represents the most recent available ranking data which includes a Full Market Cycle. Peer rankings for other time periods could differ; please see Appendix for additional time period peer rankings.

3. “Years with the firm” represents the number of years since the employee joined Neuberger Berman or a company acquired by Neuberger Berman.Past performance is not necessarily indicative of future results. As with any investment, there is the possibility of profit as well as the risk of loss.

10

Global Non-Investment Grade Credit Investment Professionals

_______________________As of September 30, 2018.

Focus

Investment

Experience Most Advanced Degree Focus

Investment

Experience Most Advanced Degree

Thomas O’Reilly, CFA High Yield 30 years MBA, Loyola University Christopher Kocinski, CFA Co-Director of Research 13 years BA, University of Chicago

Russ Covode High Yield 31 years MBA, University of Chicago Steven Ruh, CFA Co-Director of Research 13 years BA, University of Chicago

Daniel Doyle, CFA High Yield 34 years MBA, University of Chicago Ian Bates, CFA European Analyst / Trader 13 years BA, University of Nottingham

Patrick Flynn, CFA High Yield 27 years MBA, University of Chicago Brian Bunker, CFA Consumer / Financials 8 years MFin, Princeton University

Joseph Lind, CFA High Yield 19 years BA, Harvard University Darren Carter Telecom / Media & Technology 20 years JD, University of Southern California

Vivek Bommi, CFA European High Yield 20 years MBA, Columbia University David DeCoste, CFA Cyclicals 18 years MBA, University of Chicago

Joseph Lynch Senior Floating Rate Loans 23 years MBA, DePaul University Colin Donlan Portfolio Analyst 23 years MBA, DePaul University

Stephen Casey, CFA Senior Floating Rate Loans 23 years MS, Illinois Institute of Technology Jared Feeney, CFA Media / Technology 10 years MBA, Northwestern University

Pim Van Schie Structured Credit 16 years MBA, New York University Neil Frank, CFA Consumer / Cyclicals 14 years MBA, University of Wisconsin

Robert Gephardt, CFA Energy 13 years MBA, Northwestern University

Brian Giffney European Cyclicals 19 years MS, University College Dublin

Focus Most Advanced Degree Tyler Gile, CFA Portfolio Analyst 6 years BBA, University of South Carolina

CLIENT PM, TRADERS, & RISK MANAGEMENT Alex Hankin, CFA Energy / Cyclicals 5 years BS, Indiana University

Ravi Chintapalli, CFA Client Portfolio Manager, North America 15 years MBA, University of Chicago Laura Homsy European Telecom 11 years MA, University of Edinburgh

Alex Gitnik, PhD Client Portfolio Manager, Europe 21 years PhD, Saratov State Socio-Economic University Adam Howaniec Consumer 5 years BS, Indiana University

Adam Grotzinger, CFA Client Portfolio Manager, Asia 15 years BS, University of Vermont Michael Keegan, CFA Portfolio Analyst 7 years MBA, Boston College

John Abendroth, CFA Bonds / Senior Floating Rate Loans 27 years MBA, DePaul University Jonathan Levine Telecom 18 years MBA, New York University

John Lingbeck Bonds / Senior Floating Rate Loans 16 years BS, Santa Clara University Hardik Makkar, CFA European Cyclicals 8 years MS, London Business School

Quinn Murphy Bonds / Senior Floating Rate Loans 3 years BA, Butler University Mark Menapace, CFA Media / Technology 18 years BS, Cornell University

William O'Connor, CFA Bonds / Senior Floating Rate Loans 21 years MBA, University of Chicago Christopher Miller Cyclicals 21 years MBA, Washington University in St. Louis

John Sun, CFA Risk Management & Analysis 24 years PhD, Columbia University Brandon Mulroe, CFA Consumer / Cyclicals 11 years MBA, Northwestern University

Ophelia Ng Structured Credit 2 years BA, Columbia University

Allison Norman, CFA Cyclicals 6 years BS, University of Pennsylvania

Paul Raskin Portfolio Analyst 5 years BS, Georgetown University

Henry Reukauf Cyclicals / Consumer 29 years MBA, Fordham University

Martin Rotheram European Analyst / PM 18 years –

Tom Tharayil European Analyst 10 years MS, University of Cambridge

Rick Veitch Energy / Technology 2 years BS, Indiana University

Wen Yao, CFA Media / Technology 8 years MA, New York University

Rachel Young Consumer / Financials 11 years MBA, University of Denver

PORTFOLIO MANAGEMENT TEAM RESEARCH ANALYSTS

Investment

Experience

11

Downside Risk Mitigation with Upside Potential

0%

20%

40%

60%

80%

100%

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

BBB and above

BB

B

CCC and Below

RETURNS (%)1 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017YTD

2018

U.S. High Yield Composite

(Gross of Fees)8.02 5.93 -1.07 6.44 4.06 28.09 9.05 5.11 10.45 2.55 -17.47 53.11 15.64 4.54 15.99 8.09 2.39 -3.75 15.22 6.21 2.47

ICE BofA Merrill Lynch US

High Yield Constrained Index2.94 2.43 -5.19 4.48 -0.53 27.97 10.87 2.78 10.76 2.53 -26.11 58.10 15.07 4.37 15.55 7.41 2.51 -4.61 17.49 7.48 2.52

Value Added +5.08 +3.50 +4.12 +1.96 +4.59 +0.12 -1.82 +2.33 -0.31 +0.02 +8.64 -4.99 +0.57 +0.17 +0.44 +0.68 -0.12 +0.86 -2.27 -1.27 -0.05

Focus on B and BB and add value at important cyclical turning points through opportunistic use of

BBB, CCC, and floating rate corporate loans

_______________________Source: Neuberger Berman as of September 30, 2018. 1. The benchmark is the ICE BofA Merrill Lynch High Yield Constrained Index, which is designed to measure the performance of below investment grade US dollar-denominated corporate bonds publicly issued in the US

domestic market, including 144A issues. The benchmark is calculated on a total return basis. Periods less than one year are not annualized. The performance presented is supplemental to the GIPS-compliant presentation included as part of this presentation in the back. Indices are unmanaged, are not available for direct investment and are not subject to fees and expenses typically associated with managed accounts or investment funds. Please see additional notes and disclosures, which are required as part of this presentation. Preliminary returns, based on unreconciled data.

2. Cash allocation is not shown in the historical credit quality allocations. Ratings represent the rating of each security held by the Fund and not a rating of the Fund itself. Credit quality ratings are based on the ICE Bank of America ("BofA") Merrill Lynch Master High Yield Index composite ratings. The ICE BofA Merrill Lynch composite ratings are updated once a month on the last calendar day of the month based on information available up to and including the third business day prior to the last business day of the month. The ICE BofA Merrill Lynch composite rating algorithm is based on an average of the ratings of three agencies (to the extent rated). Generally the composite is based on an average of Moody’s, S&P and Fitch. For holdings that are unrated by the ICE BofA Merrill Lynch Index composite, credit quality ratings are based on S&P’s rating. Holdings that are unrated by S&P may be assigned an equivalent rating by the investment manager. No NRSRO has been involved with the calculation of credit quality and the ratings of underlying portfolio holdings should not be viewed as a rating of the portfolio itself. Portfolio holdings, underlying ratings of holdings and credit quality composition may change materially over time. Data is of a representative account and subject to change.

Past performance is not necessarily indicative of future results. As with any investment, there is the possibility of profit as well as the risk of loss.

CREDIT QUALITY2

12

As of September 30, 2018

_______________________1. Periods less than one year are not annualized.2. The performance presented is supplemental to the GIPS-compliant presentation included as part of this presentation in the back Please see additional notes and disclosures, which are required as part of this presentation.

Preliminary returns, based on unreconciled data.Indices are unmanaged, are not available for direct investment and are not subject to fees and expenses typically associated with managed accounts or investment funds.


ANNUALIZED RATES OF RETURN

U.S. High Yield Composite Performance

Period 1

U.S. High Yield

Composite2

(Gross of Fees )

(%)

ICE BofA Merrill Lynch

U.S. High Yield

Constrained Index

(%)

Value

Added

(%)

Annualized

Tracking Error

(%)

Information

Ratio

3Q 2018 2.39 2.44 -0.05 -- --

YTD 2018 2.47 2.52 -0.05 -- --

1 Year 2.62 2.95 -0.32 -- --

3 Years 7.38 8.20 -0.82 1.395 -0.584

5 Years 5.11 5.55 -0.44 1.233 -0.358

10 Years 9.69 9.40 +0.30 2.145 0.138

15 Years 8.23 7.65 +0.58 1.982 0.293

Since Inception 8.07 6.65 +1.41 2.221 0.635

(12/01/1997 - 09/30/2018)

13

Neuberger Berman High Yield Bond Fund



_______________________Source: Neuberger Berman. The management of the Neuberger Berman High Yield Bond Fund has been delegated to Neuberger Berman Investment Advisers LLC.1. Periods less than one year are not annualized.2. USD Institutional Share Class; gross of annualized management charge of 0.60%.3. Fund Inception May 3, 2006.4. As of September 30, 2018.5. Please check with your Neuberger Berman representative to see if these share classes are available at this time.MORNINGSTAR RATING © 2018 Morningstar Inc. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or it’s content providers: (2) may not be copied or distributed: and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor it’s content providers are responsible for any damages or losses arising from any use of this information. Ratings are representative of the USD Institutional Accumulating share class


KEY CHARACTERISTICS

Morningstar RatingTM

Base Currency / AUM: USD / $4.6B4

Fund Structure: UCITS

Domicile / Regulator: Dublin; Central Bank of Ireland

Fund Charges5: Institutional Class “I” 0.60%; Adviser Class “A” 1.20%

Valuation: Daily

Returns1

Neuberger Berman

High Yield Bond Fund2

(Gross of Fees )

(%)


U.S. High Yield

Constrained Index

(%)

Difference

(%)

Annualized

Tracking Error

(%)

Information

Ratio

3Q 2018 2.33 2.44 -0.11 - -

YTD 2018 2.33 2.52 -0.19 - -

1 Year 2.44 2.94 -0.50 - -

3 Years 7.05 8.20 -1.15 1.221 -0.940

5 Years 4.64 5.55 -0.91 1.115 -0.819

10 Years 9.33 9.40 -0.07 2.547 -0.028

Since Inception3 7.78 7.39 +0.39 2.466 0.158

(05/03/06 - 09/30/2018)

14

Neuberger Berman High Yield Bond Fund Performance Attribution

RETURN ATTRIBUTION BY INDUSTRY

Quarter to Date as of September 30, 2018

_______________________Source: Neuberger Berman. The management of the Neuberger Berman High Yield Bond Fund has been delegated to Neuberger Berman Investment Advisers LLC.Past performance is not indicative of future results. The data above is subject to change. Components are rounded to 2 decimal places and may incorporate immaterial rounding differences as a result. 1. Excess return relative to the ICE Bank of America ("BofA") Merrill Lynch US High Yield Constrained Index.2. Sector breakdown is based on the ICE BofA Merrill Lynch US High Yield Index sector classifications that are assigned by ICE BofA to each security in the index. These sector classifications are static unless there is a

material change to a company's business which warrants a change to the securities' sector classification. The sector classifications are updated once a month on the last day of the month based on information available up to and including the third business day prior to the last business day of the month. For holdings that are not classified by ICE BofA, Neuberger Berman Investment Advisers LLC ("NBIA") uses the sector classifications of other securities issued by the same company. If no other securities exist in the index, NBIA determines sector classification by looking at competitors’ sector classification. NBIA then combines similar classifications into broader classifications which it has determined.

Industry

Excess Return1

(%)

Sector2

(%)

Security

(%)

Top 5

Super Retail 0.04 0.04 0.00

Telecommunications 0.04 0.00 0.04

Media - Cable 0.03 0.02 0.01

Real Estate & Homebuilders 0.02 0.00 0.02

Chemicals 0.01 0.01 0.01

Bottom 5

Support-Services -0.08 0.00 -0.08

Energy -0.04 0.02 -0.06

Healthcare -0.03 0.00 -0.04

Technology & Electronics -0.02 0.00 -0.01

Theaters & Entertainment -0.01 -0.01 -0.01

15

Neuberger Berman High Yield Bond Fund Performance Attribution

RETURN ATTRIBUTION BY INDUSTRY

Year to Date as of September 30, 2018

_______________________Source: Neuberger Berman. The management of the Neuberger Berman High Yield Bond Fund has been delegated to Neuberger Berman Investment Advisers LLC.Past performance is not indicative of future results. The data above is subject to change. Components are rounded to 2 decimal places and may incorporate immaterial rounding differences as a result. 1. Excess return relative to the ICE Bank of America ("BofA") Merrill Lynch US High Yield Constrained Index.2. Sector breakdown is based on the ICE BofA Merrill Lynch US High Yield Index sector classifications that are assigned by ICE BofA to each security in the index. These sector classifications are static unless there is a

material change to a company's business which warrants a change to the securities' sector classification. The sector classifications are updated once a month on the last day of the month based on information available up to and including the third business day prior to the last business day of the month. For holdings that are not classified by ICE BofA, Neuberger Berman Investment Advisers LLC ("NBIA") uses the sector classifications of other securities issued by the same company. If no other securities exist in the index, NBIA determines sector classification by looking at competitors’ sector classification. NBIA then combines similar classifications into broader classifications which it has determined.

Industry

Excess Return1

(%)

Sector2

(%)

Security

(%)

Top 5

Banking 0.14 0.08 0.06

Telecommunications 0.13 0.00 0.13

Automotive & Auto Parts 0.11 0.09 0.03

Energy 0.09 -0.06 0.15

Utilities 0.07 -0.01 0.08

Bottom 5

Support-Services -0.28 0.00 -0.28

Media - Diversified -0.10 0.01 -0.10

Metals/Mining -0.08 0.00 -0.08

Healthcare -0.08 -0.01 -0.07

Media - Broadcast -0.08 -0.01 -0.07

16

INVESTMENT PHILOSOPHY AND PROCESS

Objective is to achieve 100 basis points over a high yield bond index over a market cycle

Investment Objective / Philosophy

PROACTIVE INVESTMENT PROCESS

• Focus on large and liquid issuers

• Portfolio diversified by issuer, industry and quality

• We believe added value can be achieved throughout all market cycles

• Proprietary fundamental research

• Disciplined, repeatable and proactive team process

• Integrated ESG analysis

ALPHA GENERATION

• We seek to capitalize on market opportunities and generate added value through:

‒ Avoidance of credit deterioration

‒ Industry and quality rotation

‒ Relative value analysis

RISK MANAGEMENT • We have developed proprietary systems to manage risk consistent with client objectives and constraints

• Oversight provided by NB risk management committee (independent of portfolio management team)

_______________________Past performance is not necessarily indicative of future results. As with any investment, there is the possibility of profit as well as the risk of loss. This material is intended as a broad overview of the portfolio managers’ style, philosophy and investment process and is subject to change. See Disclosures at the end of this presentation, which are an important part of this presentation.

18

U.S. High Yield Portfolio Construction

• Average issuer size 0.5%

• Maximum per issuer 5%

• Average of 150 – 225 issuers

• Maximum generally 3x market weight

• Approximately 20 – 30 industries

represented

• USD denominated corporate debt

• Opportunistic use of floating rate loans

• No emerging market or sovereign

debt, derivatives or CDS

• Focus on BB and B large and liquid

issuers

• Opportunistic use of BBB and CCC credit

tiers

• Avoid defaulted issuers

DIVERSIFIED BY ISSUER DIVERSIFIED BY INDUSTRY

OTHER KEY CHARACTERISTICS

_______________________Sources: Neuberger Berman. This material is intended as a broad overview of the portfolio managers’ style, philosophy and investment process and is subject to change. See Disclosures at the end of this presentation, which are an important part of this presentation.1. Data is of a representative account and subject to change without notice.Credit quality ratings are based on the ICE Bank of America ("BofA") Merrill Lynch High Yield Index composite ratings. The ICE BofA Merrill Lynch composite ratings are updated once a month on the last calendar day of the month based on information available up to and including the third business day prior to the last business day of the month. The ICE BofA Merrill Lynch composite rating algorithm is based on an average of the ratings of three agencies (to the extent rated). Generally the composite is based on an average of Moody’s, S&P and Fitch. For holdings that are unrated by the ICE BofA Merrill Lynch Index composite, credit quality ratings are based on S&P’s rating. Holdings that are unrated by S&P may be assigned an equivalent rating by the investment manager. No NRSRO has been involved with the calculation of credit quality and the ratings of underlying portfolio holdings should not be viewed as a rating of the portfolio itself. Portfolio holdings, underlying ratings of holdings and credit quality composition may change materially overtime. Indices are unmanaged, are not available for direct investment and are not subject to fees and expenses typically associated with managed accounts or investment funds.

CREDIT QUALITY FOCUS1

General attributes:

19

U.S. High Yield Investment Process

Narrow universe to a manageable number of credits to research

UNIVERSE

All corporate securities rated below BBB-, which is comprised of approximately

900 issuers

UNIVERSE

ELIMINATE

FUNDAMENTAL

ANALYSIS

BEST

IDEAS

ELIMINATE

Less liquid, distressed, and defaulted issuers

FUNDAMENTAL ANALYSIS

Apply “Credit Best Practices” checklist

FOCUS ON BEST IDEAS

Credit analysis capabilities are complemented with a technology-driven set of

proprietary analytical processes to identify, select and monitor portfolio positions.

A customized database containing detailed information on over 2,000 issuers is

leveraged and 150 – 225 issuers are selected as investments for clients’ portfolios

_______________________This material is intended as a broad overview of the portfolio managers’ style, philosophy and investment process and is subject to change. See Disclosures at the end of this presentation, which are an important part of this presentation.Credit quality ratings are based on the ICE BofA Index composite ratings. The ICE BofA composite ratings are updated once a month on the last calendar day of the month based on information available up to and including the third business day prior to the last business day of the month. The ICE BofA composite rating algorithm is based on an average of the ratings of three agencies (to the extent rated). Generally the composite is based on an average of Moody’s, S&P and Fitch. For holdings that are unrated by the ICE BofA Index composite, credit quality ratings are based on S&P’s rating. Holdings that are unrated by S&P may be assigned an equiva lent rating by the investment manager. No NRSRO has been involved with the calculation of credit quality and the ratings of underlying portfolio holdings should not be viewed as a rating of the portfolio itself. Portfolio holdings, underlying ratings of holdings and credit quality composition may change materially over time.

20

Disciplined team process

Portfolio Strategy

and Risk BudgetingRisk Management

Credit Committee

Consumer Sector Team Cyclical Sector Team Telecom Sector TeamEnergy/Utilities

Sector Team

_______________________For illustration purposes only. This material is intended as a broad overview of the portfolio managers’ style, philosophy and investment process and is subject to change without notice. See Disclosures at the end of this presentation, which are an important part of this presentation.

Team Dynamic

Portfolio Construction

Team

21

Issue Selection

• Process driven by longstanding

“Credit Best Practices” checklist

• Three financial models: upside,

downside and base case modeling

• Focus on cash flow for debt service

• Assessment of management

• ESG assessment

• Multiple sources of repayment

• Bond indenture/credit agreement

analysis

• Vigilant and proactive monitoring

using proprietary monitoring

database

• Internal NB credit rating

• Relative value spread analysis

across industry and credit tier in

light of NB rating

• Potential for deleveraging and credit

upgrade

• Holding reaches full valuation

and we have identified a

replacement

• Anticipation of deteriorating credit

fundamentals and / or ESG factors

• Unexplained shortfall relative to

financial scenarios

• Unexpected developments,

including unanticipated change in

management

• Fundamental problems at an

industry level

VALUATIONCREDIT SELL DISCIPLINE

Proactive process that seeks to be disciplined and repeatable

_______________________This material is intended as a broad overview of the portfolio managers’ style, philosophy and investment process and is subject to change without notice. See Disclosures at the end of this presentation, which are an important part of this presentation.

22

“Credit Best Practices” Checklist

• Direction of Global Economy:

Economic indicators

• Globalization trends

Regional GDP/economic forecasts

Global equity market movements

Currency fluctuations

Our investment discipline seeks to ensure we thoroughly understand the investment thesis for each

portfolio credit and any underlying assumptions

• Credit Cycle:

Degree of cyclicality

Spreads relative to historic levels

Banking industry

• Political Factors:

Budget surplus/deficit

Election/wars

ECONOMY: KEY DATA POINTS

• Where are we in industry life cycle?

• Competitive landscape

• Trend for industry consolidation

• Capacity levels

• Regulatory environment

• Competitor analysis

• Industry value chain

• Industry size and growth

• Rating agency trends

• Industry model/return

• Sensitivity to exogenous factors

INDUSTRY: KEY DATA POINTS

• Established businesses with longer-term track records

• Ability to de-lever

• Origination (roll-up vs. organic)

• Understand business and products

Business

Fundamentals

• Offset business risk

• Cautious of large, transforming acquisitions

• Quantify/evaluate CAPEX

• Ability to delay commitments

• Accounting practices

Quality of Cash

Flow

• Understand upside/downside potential in terms of credit ratios, spreads and ratings

• Benchmark company vs. industry and its own history

Scenario Analysis

• Evaluate management’s intention and ability to right size the capital structure

• Focus on senior structures in tight capital markets and slow growth periods

Capital Structure

• Cash

• Bank lines

• Covenants

• Non-core asset sales

• Other sources of cash

Liquidity

• Proprietary ESG Scoring System

• Assess industry specific Environmental and Social factors

• Management and Governance assessment

• Customized sector weightings

ESG Scorecard

ISSUER: KEY CONSIDERATIONS

BO

TT

OM

-UP

AN

AL

YS

IST

OP

-DO

WN

AN

AL

YS

IS


23

Integration of ESG Analysis into the Investment Process


PRI has awarded NB an A+ for our Fixed Income ESG integration

BUSINESS

FUNDAMENTALS

CAPITAL

STRUCTURE /

COVENANTS

SCENARIO

ANALYSIS

NB

ESG SCORE

Differentiated ESG Process

NB Internal Credit Rating• ESG is a critical component of the fundamental research

process that determines Internal Credit Ratings

• ESG analysis is performed by the Non-Investment Grade

Credit research team, not outsourced to a centralized

group within NB or third party ESG rating service

• Proactive engagement with issuers to enhance disclosure,

improve ESG analysis, and affect positive change

• Quarterly ESG Review with Credit Committee

• Performance attribution is monitored to determine the

impact of ESG analysis

Credit Analysts Identify Material Industry-Specific

Environmental & Social Factors

• NB Non-Investment Grade Credit analysts use their sector

expertise to customize criteria for each industry, using the

Sustainability Accounting Standards Board (“SASB”) as a

starting point

• Governance assessment consistent across industries and

specific to the non-investment grade credit market

Proprietary ESG Scoring Process For All Issuers in Our

Portfolios

• NB ESG Scores created using multiple quantitative data

sources and qualitative assessments

• Internal Credit Ratings are notched up or down based on

NB ESG Scores to enhance pricing discipline

• NB ESG Scores are monitored by Credit Committee as an

important component of our investment process

24

ESG Scoring Methodology


Environmental (E)

Criteria Examples

Social (S)

Criteria Examples

Governance (G)

Criteria Examples

Environmental, Social, and Governance weightings are customized by industry

NB ESG Score is an important component of the NB Internal Credit Rating

Industry-Specific Criteria

Healthcare

• Water and waste intensity

Utilities

• Track record of regulatory compliance

• Exposure to alternative energy sources

• Carbon intensity

• Water and waste intensity

Services

• Carbon intensity

Industry-Specific Criteria

Healthcare

• Labor management track record

• Pricing and access to medicines

• Ethical marketing practices

• Product safety track record

Utilities

• Engagement with communities,

regulators and lawmakers


Services

• Data security practices


• Fair labor practices and sourcing

Standardized Non-IG Criteria

Governance Structure

• Board independence from management

• Compensation tied to long-term viability

Experience and Track Record

• Background and tenure within industry

• Experience leading leveraged firm

Transparency

• Senior management access

• Adequate disclosures and accruals

Adaptability

• Commitment to de-leverage

• Ability to meet guidance / budget

25

3 Financial Models,

Covenant Analysis, Management

Investment Thesis 2-PAGE

SUMMARY REPORT

The team complements its credit analysis capabilities with a technology driven set of analytical

processes to identify, select and monitor portfolio positions

• A customized database contains detailed information on over 2,000 issuers.

• The database ensures the consistent application of our Credit Best Practices research framework across our team.

• Extensive fundamental, financial and capital structure information is available on each issuer:

Detailed reports and credit reviews for each credit held across all portfolio strategies

“Diary” for each issuer with current and historical commentary from investment professionals

Comprehensive rating agency information and commentary for each issuer

In-depth analysis of each issuer’s business fundamentals and strengths / weaknesses

ESG Scorecard

Outlook

Credit Reporting

_______________________This material is intended as a broad overview of the portfolio managers’ style, philosophy and investment process and is subject to change without notice. For illustrative purposes only. The above sample report is intended to demonstrate the portfolio management team’s research capabilities and is not intended to recommend any particular investment. The use of tools cannot guarantee performance.

Proprietary Analytical Tools

26

Decision-Making Forums

• Review overnight/morning credit events and material price changes

• Review risk management and performance reports

• Discuss economic data, new issue calendar, secondary trade ideas and priorities for the day

• Recap trading activity

Team members share information through an open trading room environment


MORNING MEETINGS

• Analysts provide deep dive into sector fundamentals

• Provides framework for sector weights and individual credit positions

• Focus on relative value and secondary market opportunities

CREDIT SECTOR REVIEWS

• Analysts present new investment ideas to a committee made up of senior investment professionals

• Review investments that have declined 5% relative to the market

• Quarterly sector performance review

CREDIT COMMITTEE MEETINGS

• Review major credit events of the past week

• Review portfolio positioning

• Review expected returns and credit portfolio risk vs. benchmarks

HIGH YIELD PORTFOLIO REVIEW

• Overall global fixed income portfolio construction and asset allocation review

• Participate in discussion and vetting of all return expectations

• Review macro economic data

GLOBAL HIGH YIELD STRATEGY

• Review the investment grade market globally

• Analysts discuss sector views and relative value

• Coordinate issuers in transition between investment grade and non-investment grade

INVESTMENT GRADE MEETINGS

• Key input into broader NB asset allocation process

• Present relative value and return expectations across non-investment grade credit markets

• Identify risks and opportunities, as well as broad market themes

ASSET ALLOCATION MEETINGS

• Discuss ESG related performance data

• Update ESG avoidance and notching lists

• Review ESG engagement priorities

• Evaluate continuous improvement initiatives

ESG QUARTERLY REVIEW

27

Risk Management

Firm-wide commitment of people, technology and an independent fixed income risk & analysis team

• Pre-trade compliance

• Post-trade compliance

• Separate portfolio compliance staff

• Portfolio risks are characterized daily

• Risk quantified daily relative to the index by:

– Sector, Industry, Issuer, Country, Coupon, Maturity, Duration, Quality, Liquidity, Seniority

CONSTANT

MONITORING

PORTFOLIO

RISK

PORTFOLIO

COMPLIANCE

RISK MANAGEMENT

• Structure risk reports: Blackrock Aladdin

• Price changes: Bonds, Equities, CDS, Loans

• Five percentage drop relative to market initiates a Credit Committee review

_______________________For illustration purposes only and not intended to be a comprehensive description of all risk management practices. Subject to change without notice.

28

Investing in High Yield Bonds - Risk Considerations

Market Risk: The risk of a change in the value of a position as a result of underlying market factors, including among other things, the overall performance

of companies and the market perception of the global economy.

Credit Risk: The risk that bond issuers may fail to meet their interest repayments, or repay debt, resulting in temporary or permanent losses to the Fund.

Liquidity Risk: The risk that the Fund may be unable to sell an investment readily at its fair market value. In extreme market conditions this can affect the

Fund’s ability to meet redemption requests upon demand.

Interest Rate Risk: The risk of interest rate movements affecting the value of fixed-rate bonds.

Derivatives Risk: The Fund is permitted to use certain types of financial derivative instruments (including certain complex instruments). This may increase

the Fund’s leverage significantly which may cause large variations in the value of your share. (Investors should note that the Fund may achieve its

investment objective by investing principally in Financial Derivative Instruments (FDI). There are certain investment risks that apply in relation to the use of

FDI.)

Counterparty Risk: The risk that a counterparty will not fulfil its payment obligation for a trade, contract or other transaction, on the due date.

Operational Risk: The risk of direct or indirect loss resulting from inadequate or failed processes, people and systems including those relating to the

safekeeping of assets or from external events.

Currency Risk: Investors who subscribe in a currency other than the base currency of the Fund are exposed to currency risk. Fluctuations in exchange

rates may affect the return on investment. The past performance shown is based on the share class to which this presentation relates. If the currency of this

share class is different from your local currency, then you should be aware that due to exchange rate fluctuations the performance shown may increase or

decrease if converted into your local currency.

29

PORTFOLIO STATISTICS


CREDIT QUALITY (%)1


_______________________Source: Neuberger Berman. The management of the Neuberger Berman High Yield Bond Fund has been delegated to Neuberger Berman Investment Advisors LLC. The data above is subject to change without notice. 1. Credit quality ratings are based on the ICE Bank of America ("BofA") Merrill Lynch Master High Yield Index composite ratings. The ICE BofA Merrill Lynch composite ratings are updated once a month on the last calendar day

of the month based on information available up to and including the third business day prior to the last business day of the month. The ICE BofA Merrill Lynch composite rating algorithm is based on an average of the ratings of three agencies (to the extent rated). Generally the composite is based on an average of Moody’s, S&P and Fitch. For holdings that are unrated by the ICE BofA Merrill Lynch Index composite, credit quality ratings are based on S&P’s rating. Holdings that are unrated by S&P may be assigned an equivalent rating by the investment manager. No NRSO has been involved with the calculation of credit quality and the ratings of underlying portfolio holdings should not be viewed as a rating of the portfolio itself. Portfolio holdings, underlying ratings of holdings and credit quality composition may change materially overtime.

Indices are unmanaged, are not available for direct investment and are not subject to fees and expenses typically associated with managed accounts or investment funds.


PORTFOLIO STATISTICS

Neuberger Berman

High Yield

Bond Fund

ICE BofAML

U.S. High Yield

Constrained Index

Weighted Average Yield To Worst 5.86% 6.29%

Weighted Average Spread To Worst (bps) 302 342

Weighted Average Duration (years) 3.36 3.97

Weighted Average Maturity (years) 5.56 6.32

Senior Floating Rate Loan Weight 5.46% 0.00%

Number of Issuers 178 856

Rating Groups

Neuberger Berman

High Yield

Bond Fund

(%)

ICE BofAML

U.S. High Yield

Constrained Index

(%)

Over/Under

Weight

(%)

BBB and above 4.30 0.00 4.30

BB 54.35 46.07 8.29

B 34.81 41.50 -6.69

CCC or lower 5.37 12.43 -7.07

NR 0.00 0.00 0.00

Cash 1.17 0.00 1.17

Total 100.00 100.00

31


_______________________Source: Neuberger Berman. The management of the Neuberger Berman High Yield Bond Fund has been delegated to Neuberger Berman Investment Advisors LLC.The above characteristics are subject to change without notice. Indices are unmanaged, are not available for direct investment and are not subject to fees and expenses typically associated with managed accounts or investment funds. Past performance is not necessarily indicative of future results. As with any investment, there is the possibility of profit as well as the risk of loss.

SECTOR WEIGHTS VERSUS BENCHMARK TOP TEN ISSUER OVERWEIGHTS


Industry

Neuberger Berman

High Yield

Bond Fund

(%)

ICE BofAML

U.S. High Yield

Constrained Index

(%)

Difference

(%)

Top 5

Diversified Financial Serv ices 7.72 4.76 2.96

Utilities 5.21 2.26 2.94

Media - Cable 8.15 6.39 1.77

Gaming / Lodging / Leisure 6.20 4.61 1.59

Media - Broadcasting / Diversified 5.05 3.85 1.19

Bottom 5

Energy 7.38 11.38 -4.00

Super Retail 0.41 2.50 -2.10

Aerospace / Defense 0.24 1.77 -1.54

Real Estate / Homebuilders 3.42 4.67 -1.26

Automotive / Auto Parts 0.76 1.76 -1.00

Issuers

Overweight

(%)

Navient Corp 1.61

Medical Properties Trust 1.44

Avolon Holdings Ltd 1.24

NRG Energy Inc 1.12

Frontier Communications 1.04

Vistra Energy Corporation 0.99

Aircastle Ltd. 0.92

Talen Energy 0.91

HCA Holdings Inc 0.89

Calpine Corp 0.87

32

ENERGY SECTOR WEIGHTS VERSUS BENCHMARK


_______________________Source: Neuberger Berman. The management of the Neuberger Berman High Yield Bond Fund has been delegated to Neuberger Berman Investment Advisors LLC.1. The above characteristics are subject to change without notice. Indices are unmanaged, are not available for direct investment and are not subject to fees and expenses typically associated with managed accounts or investment funds.

Neuberger Berman High Yield Bond Fund Energy Positioning

Energy Subsectors

Neuberger Berman

High Yield

Bond Fund1

(%)

ICE BofAML

U.S. High Yield

Constrained Index

(%)

Over/Under

Weight

(%)

Exploration & Production 6.71 7.48 -0.77

Oil Field Services 0.67 3.41 -2.74

Refineries / Other 0.00 0.50 -0.50

Subtotal - Energy 7.38 11.38 -4.00

Gas Distribution Subsectors

Propane Distribution 0.00 0.40 -0.40

Midstream 4.66 4.15 0.51

Subtotal - Gas Distribution 4.66 4.55 0.11

Total Energy & Gas Distribution 12.05 15.94 -3.89

33

MARKET OVERVIEW

Q4 2018: Key Non-Investment Grade Themes

Key factors that could increase market volatility:

• U.S. tariffs and international response

• Mid-term elections in the U.S.

We believe investors should be focused on:

• U.S. economic momentum is strong, but plateauing

• Uncertain interest rate environment

• Trade policy

• Signs of late cycle behavior

• Technological disruption/ Secular shifts within industries

• Overall default environment contained

• Net new issuance in the leveraged loan market

• Underweight lower quality securities and cyclical industries

• Focus on companies with a U.S. footprint and a history of

stable free cash flow generation

Constructive fundamentals, offset by increases in volatility, could keep spreads range-bound

Macroeconomic Environment Market Themes

Key Risks Portfolio Strategy

This material is intended as a broad overview of the portfolio managers’ style, philosophy and investment process and is subject to change without notice. Reflects the views of the Currency team and their views on supports and risk. See Disclosures at the end of this presentation, which are an important part of this presentation.

• Monetary policy versus market expectations

• Concerns about economic and credit cycle

12 month forward outlook: U.S. High Yield Bonds: 4 – 7% , Short Duration High Yield Bonds: 4 – 6%, Senior Floating Rate Loans: 4 – 6%

35

Risk to Global Growth: Tariffs & Trade

Heightened global trade tensions, but expect de-escalation over next 6-12 months

Sources: Neuberger Berman, whitehouse.gov, Bloomberg, Cornerstone Macro; Peterson Institute for International Economics.

US imposes tariffs

on Solar Panels &

Washing Machines.

JUL 2018JUN 2018MAY 2018APR 2018MAR 2018JAN 2018 AUG 2018 SEP 2018

US Steel (25%) &

aluminum (10%)

tariffs implemented,

excluding certain

allies (Canada,

Mexico, EU). Tariffs

applied to $50bn in

Chinese goods.

Investigation initiated

under section 232

into auto imports.

US steel and

aluminum tariffs

extended to include

US allies who

were previously

exempt (Canada,

Mexico, EU).

On July 6, US $34bn

in tariffs up to 25%

effective,

remaining $16bn to

follow shortly

thereafter.

Completion of the US

and China’s $50bn in

respective tariffs.

China files WTO

dispute against US

solar panel tariffs.

Negotiations resume.

US imposes 10% tariff

of $200bn worth of

Chinese goods with

tariff rate increasing to

25% in 2019. China

retaliates with tariffs

on $60bn of US

goods.

US Trade

Representative

releases list of

$50bn in Chinese

goods for proposed

25% tariff.

China threatens to

enact retaliatory

tariffs on $50bn of

US goods.

Top 5 Countries Have Accounted For Over 58% of US Imports

0

100

200

300

400

500

600

2007 2012 2017

US

Imp

ort

s in

$B

n

China Mexico Canada Japan Germany

36

U.S. Interest Rates: Monetary Policy Expectations

Market expectations diverge from Fed expectations in 2019 and beyond, as the market prices an

earlier end to the hiking cycle

_______________________Source: Bloomberg, Neuberger Berman. As of September 30, 2018. Assumptions for right chart: ECB: The European Central Bank continues EUR15bn monthly asset purchases through December 2018 then halts purchases. Fed: The Federal Reserve continues on its scheduled wind-down with $40bn per month running off in 2018, $35bn in 2019 and $30bn in 2020 until the $3.5tn level is reached, at which point assets are held constant.For illustrative and discussion purposes only. Nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. This material is not intended as a formal research report and should not be relied upon as a basis for making an investment decision. Investing entails risks, including possible loss of principal. Past performance is no guarantee of future results.

1.00

1.25

1.50

1.75

2.00

2.25

2.50

2.75

3.00

3.25

3.50

3.75

4.00

2018 2019 2020 2021

%

Market Implied(Fed Funds Futures)

Median Fed "Dot"(Top End of Range)

NB Estimate(Top End of Range)

Year-End Fed Funds Estimates Fed and ECB balance sheet evolution

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Dec-18 Dec-19 Dec-20

Bn

Fed ($) ECB (€)

Fed Estimate ECB Estimate

37

Many market and economic indicators point to late cycle in the U.S., perhaps less evident in Europe

_______________________Source: Bloomberg, Bureau of Labor Statistics. As of September 30, 2018. IG Corporate OAS: US – Bloomberg Barclays US Credit Index; Euro – Bloomberg Barclays Euro Aggregate Corporate Index. High Yield OAS: US – ICE BofAML High Yield Master Constrained Index; Euro – ICE BofAML EUR Non-Financial High Yield 3% Capped Index. *Eurozone Manufacturing PMI data series begins in April 2011. For illustrative and discussion purposes only. Nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. This material is not intended as a formal research report and should not be relied upon as a basis for making an investment decision. Investing entails risks, including possible loss of principal. Past performance is no guarantee of future results.

Where Are We in the Economic and Credit Cycle?

100

328

3.06

0.24

2914

2.25

0.12

3.7

1.4

2.2

2.8

Market

Indicators

Economic

Indicators

114

332

0.47

0.99

3399

-0.40

0.49

8.1

1.0

0.9

2.2

Earlier LaterPoint in Cycle Earlier LaterPoint in Cycle

IG Corporate OAS (bp)

Unemployment Rate

10-Year Govt Rate

S&P 500 Index

2s-10s Govt Curve

High Yield OAS (bp)

Fed Funds Rate

Output Gap

Productivity YoY %

Core Inflation YoY %

Wage Growth YoY %

Manufacturing PMI59.8

492

2131

1.36

2.91

676

0.25

-4.82

10.0

6.2

0.6

1.5

36.4

IG Corporate OAS (bp)

Unemployment Rate

10-Year Govt Rate

Euro Stoxx 50 Index

2s-10s Govt Curve

High Yield OAS (bp)

Deposit Facility Rate

Output Gap

Productivity YoY %

Core Inflation YoY %

Wage Growth YoY %

Manufacturing PMI*

73

328

3.72

0.34

3829

2.00

0.49

8.1

-1.0

1.8

3.7

60.6

53.3

469

2029

-0.19

2.36

1810

-0.40

-3.68

12.1

2.5

0.6

0.8

43.6

EurozoneUnited States

81

323

3.99

0.19

2.25

0.12

3.7

-0.8

2.4

3.6

61.3

2930

Post-Crisis Range:

January 2009 – September 2018

Post-Crisis Range:

January 2009 – September 2018

38

United States: Economic Momentum is Strong but Plateauing

_______________________Source: Bloomberg, as of September 2018

Q2 probably marks the sequential peak in US growth, as limited evidence of accelerating capital

spending

GDP vs. Advanced Capex Intention SurveysPMIs off of post-crisis highs but remain strong

0

5

10

15

20

25

30

35

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

Jan-10 Jan-12 Jan-14 Jan-16 Jan-18

US GDP YoY % (LHS)

Average of Regional Fed Capex Intention Surveys - Advanced 3M (RHS)

30

35

40

45

50

55

60

65

Jul-08 Jul-10 Jul-12 Jul-14 Jul-16 Jul-18

ISM Non-Manufacturing

ISM Manufacturing

39

Credit Spreads and High Yield Default Rates


-200

200

600

1,000

1,400

1,800

2,200

2,600

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

LTM

2018

E

2019

E

Spread (bps)Par-weighted default rate (%)

LTM High Yield Default Rate High Yield Spread to Worst1 2

1. J.P. Morgan Default Monitor. Defaults based on par amounts. 2. High Yield Spread to Worst is represented by the J.P. Morgan U.S. High Yield Index.3. Annual High Yield return is represented by the ICE Bank of America Merrill Lynch U.S. High Yield Index.4. Sell off infers any calendar year that produced a negative total return with recovery being the full year immediately following.5. Long-term average is represented by the 25-year average provided by J.P. Morgan. See definitions of indices at the back of this presentation. Past performance is not necessarily indicative of future results. As with any investment, there is the possibility of profit as well as the risk of loss. Historical trends do not imply, forecast, or guarantee future results.

ANNUAL HIGH YIELD RETURNS (%)3

1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

4.5 13.4 2.3 -4.4 39.2 17.4 16.7 -1.0 20.5 11.3 13.3 3.0 2.5 -5.1 4.5 -1.9 28.1 10.9 2.7 11.8 2.2 -26.4 57.5 15.2 4.4 15.6 7.4 2.5 -4.6 17.5 7.5 2.5

Recession

Recession

Average Return During Sell Off4: -7.2%

Median Return During Sell Off4: -4.5%

Average Return During Recovery4: 27.9%

Median Return During Recovery4: 24.3%

Average HY Spread to Worst2: 601 Bps

Median HY Spread to Worst2: 543 Bps

Long-Term Average Default Rate5: 2.89%

Long-Term Median Default Rate5: 1.80%

LTM Default Rate: 2.02%

Spreads vs. High Yield Default Rates

40

0

1

2

3

4

5

1Q08

3Q08

1Q09

3Q09

1Q10

3Q10

1Q11

3Q11

1Q12

3Q12

1Q13

3Q13

1Q14

3Q14

1Q15

3Q15

1Q16

3Q16

1Q17

3Q17

1Q18

EBITDA / Int Exp

0

1

2

3

4

5

1Q08

3Q08

1Q09

3Q09

1Q10

3Q10

1Q11

3Q11

1Q12

3Q12

1Q13

3Q13

1Q14

3Q14

1Q15

3Q15

1Q16

3Q16

1Q17

3Q17

1Q18

Total Debt / EBITDA

-30%

-20%

-10%

0%

10%

20%

1Q08

2Q08

3Q08

4Q08

1Q09

2Q09

3Q09

4Q09

1Q10

2Q10

3Q10

4Q10

1Q11

2Q11

3Q11

4Q11

1Q12

2Q12

3Q12

4Q12

1Q13

2Q13

3Q13

4Q13

1Q14

2Q14

3Q14

4Q14

1Q15

2Q15

3Q15

4Q15

1Q16

2Q16

3Q16

4Q16

1Q17

2Q17

3Q17

4Q17

1Q18

2Q18

HY Revenues YOY % Change HY Ex-Energy Revenues YOY % Change

1. Source: Bank of America Merrill Lynch. Data as of June 30, 2018.2. Source: Bank of America Merrill Lynch. Data as of June 30, 2018. Adjusted metrics are calculated using Adjusted EBITDA which removes the impact of unusual items from earnings including but not limited to non-recurring

items, impairments, goodwill etc.Historical trends do not imply, forecast or guarantee future results. This material is provided for informational purposes only, is as of the date hereof and is subject to change without notice. Neuberger Berman advisors and portfolio managers may make recommendation or take positions contrary to the views expressed. Nothing herein constitutes a prediction or projection of future events or future market behavior. Due to a variety of factors, actual events or market behavior may differ significantly from any views expressed.

Fundamental Trends

Market’s credit quality remains stable

Revenue Growth was Strongest Since Late 20141

Leverage Appears to Have Plateaued2 Interest Coverage Remains Strong2

41

High Yield and Senior Floating Rate Loans Market Technicals

High Yield Sources of Supply and Demand (US $ Billions)1

Senior Floating Rate Loans Sources of Supply and Demand (US $ Billions)1


2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 YTD 2018

Gross New Issuance 147.9 52.9 180.7 302.0 245.6 368.1 398.5 355.7 293.2 286.2 328.1 168.3

Calls -46.3 -14.9 -22.7 -61.1 -73.4 -102.1 -122.8 -137.2 -126.3 -127.5 -176.1 -111.5

Tenders -63.8 -35.5 -45.6 -60.7 -49.4 -50.9 -47.2 -47.2 -49.8 -70.6 -59.0 -32.6

Maturities -32.0 -26.9 -36.8 -32.1 -47.4 -42.6 -48.8 -40.1 -44.2 -50.9 -37.5 -34.4

Net new issuance 5.7 -24.4 75.7 148.2 75.4 172.4 179.7 131.2 72.9 37.1 55.4 -10.3

Fallen angels2 50.7 55.9 150.2 28.0 38.4 26.7 41.2 37.2 45.53 143.43 19.9 40.24

Total Net Supply 56.4 31.5 225.9 176.2 113.8 199.1 221.0 168.4 118.4 180.5 75.3 29.9

Rising stars2 19.2 26.5 13.1 32.9 34.7 51.9 83.7 45.9 50.3 23.8 22.2 53.4

Coupon reinvestment @

75%58.7 57.7 68.8 71.0 82.3 83.0 88.3 89.3 93.8 98.2 87.4 61.1

Mutual fund flows 5.1 5.3 31.9 12.5 15.6 29.0 -4.7 -23.8 -16.6 9.6 -20.3 -25.5

Total Demand 83.0 89.6 113.7 116.4 132.6 163.9 167.4 111.5 127.5 131.6 89.3 89.0

Supply surplus

(shortfall) -26.6 -58.1 112.1 59.8 -18.8 35.2 53.6 56.9 -9.1 48.9 -14.0 -59.1

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 YTD 2018

Gross New Issuance 388.3 72.4 38.3 154.5 229.3 300.5 669.9 466.9 325.8 485.4 973.6 594.3

Paydowns5 -149.1 -48.9 -88.1 -142.5 -201.8 -199.6 -259.5 -188.2-

175.0-260.9 -344.8 -186.7

Repricings 0.0 0.0 0.0 0.0 -0.3 -37.3 -241.7 -90.5 -63.5 -137.4 -440.3 -227.6

Net new issuance 239.3 23.4 -49.8 12.0 27.2 63.5 168.8 188.2 87.3 87.1 188.9 180.0

Retail inflows -0.8 -5.6 4.9 17.9 13.9 12.2 63.0 -23.8 -21.7 9.2 13.1 15.5

CLO issuance6 90.0 21.4 1.3 3.8 13.6 55.7 87.1 124.1 99.5 73.3 117.1 103.5

Total Demand 89.3 15.8 6.1 21.7 27.5 67.9 150.0 100.3 77.8 82.5 130.2 119.0

Supply surplus (shortfall) 150.0 7.6 -56.0 -9.7 -0.3 -4.4 18.8 87.9 9.5 4.6 58.7 61.0

1. J.P. Morgan citing Bloomberg, S&P LCD, and Lipper FMI.2. Fallen angels and rising stars represent bonds downgraded to non-investment grade status and upgraded to investment grade status, respectively.3. Inclusive of only U.S. issuers.4. Inclusive of Teva Pharmaceuticals, which accounted for $18.5bn5. Paydowns include amortizations, unscheduled paydowns, and bond-for-loan issuance; CLO issuance includes only USD deals.6. CLO issuance excludes refinancing/resets.

42

0%

20%

40%

60%

80%

100%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

NR CCC B BB

0%

20%

40%

60%

80%

100%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

NR CCC B BB

1. Source: Bank of America Merrill Lynch, S&P LCD. Data as of September 30, 2018. High Yield ratings are ICE BofA Merrill Lynch US High Yield ratings and senior floating rate loan ratings are S&P ratings.2. Market size is representative of total par value outstanding. Benchmarks used were the ICE Bank of America Merrill Lynch U.S. High Yield Index and S&P/LSTA Leveraged Loan Index.Historical trends do not imply, forecast or guarantee future results. Information is as of the date indicated and subject to change without notice. Nothing herein constitutes a prediction or projection of future events or future market behavior.

Issuance Trends1

Aggressive issuance has increased within certain sectors of non-investment grade credit markets

($bn) 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

HY Size2 709 728 825 983 954 1097 1241 1337 1341 1298 1283 1247

($bn) 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

LL Size2 554 594 529 497 517 550 682 831 872 881 955 1089

0%

20%

40%

60%

80%

100%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Refinancing Equity Monetization General Corporate Capex Acquisitions/LBOs

0%

20%

40%

60%

80%

100%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Refinancing Equity Monetization General Corporate Capex Acquisitions/LBOs

High Yield New Issue Volume By Purpose Loan New Issue Volume By Purpose

High Yield New Issue Volume By Rating Loan New Issue Volume By Rating

43

Modest Maturity Wall1

4

28

71

101

180193

178

209

305

317

32

79

124

215

319

274

26

0

50

100

150

200

250

300

350

2018 2019 2020 2021 2022 2023 2024 2025 2026 or Later

($bn)

High Yield Senior Floating Rate Loans

Continued refinancing has reduced near-term maturities

1. Source: Bank of America Merrill Lynch, S&P Capital IQ LCD. Data as of September 30, 2018. Benchmarks used were the ICE Bank of America Merrill Lynch U.S. High Yield Index, ICE Bank of America Merrill Lynch 0 -3 Year U.S. High Yield Index, and S&P/LSTA Leveraged Loan Index.

See definitions of indices at the back of this presentation. Past performance is not necessarily indicative of future results. As with any investment, there is the possibility of profit as well as the risk of loss.

44

Lower Quality Valuations

• CCC-rated bonds have traded below their long term spread-to-worst (STW) median during 9 distinct periods over the past 20 years

• During these 9 periods, the median number of consecutive months that CCC spreads remained below their historical median is 8 months

• Currently, CCC spreads have remained below their historical median for 22 consecutive months, 3rd longest on record.

CCC valuations appear rich and are well below their long term historical median

Key Points

0

400

800

1200

1600

2000

2400

2800

3200

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Sp

read

to

Wo

rst

CCC STW Median

Source: BofA. September 30, 2018

45

Liquidity Trends

Trading volumes continue to increase

Average Daily High Yield Trading Volume (Including 144A):

• 2018 YTD3: $11.6 Billion

• 2017: $12.0 Billion

• 2016: $12.0 Billion

84% 81% 80%76%

86% 83% 71% 68% 70%

0%

50%

100%

$bn

500 $bn

1,000 $bn

2009 2010 2011 2012 2013 2014 2015 2016 2017

Avg. Size of the S&P/LSTA LLI Annual Loan Turnover Ratio (%)

$bn

1,000 $bn

2,000 $bn

3,000 $bn

4,000 $bn

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Excluding 144A Including 144A

174%149% 137%

152%131% 111%

114%

113%159% 200% 232%

234%

0%

40%

80%

120%

160%

200%

240%

280%

$bn

500 $bn

1,000 $bn

1,500 $bn

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

U.S. High Yield Market Size² Annual High Yield Turnover Ratio (%)

Market Size Trading Volume

Turnover

Market Size

Turnover

$bn

200 $bn

400 $bn

600 $bn

800 $bn

2009 2010 2011 2012 2013 2014 2015 2016 2017

Trading Volume

1. Source: TRACE, ICE Data Services. Data as of December 31, 2017. TRACE began tracking 144a tradingvolume in July 2014.

2. U.S. high yield market size is represented by the ICE BofA Merrill Lynch U.S. High Yield Index. 3. As of September 30, 2018.4. Source: LSTA, The LSTA Trade Data Study as of December 31, 2017.5. As of August 31, 2018.Historical trends do not imply, forecast or guarantee future results. This material is provided for informational purposes only, is as of the date hereof and is subject to change without notice. Neuberger Berman advisors and portfolio managers may make recommendation or take positions contrary to the views expressed. Nothing herein constitutes a prediction or projection of future events or future market behavior. Due to a variety of factors, actual events or market behavior may differ significantly.

Average Daily Senior Floating Rate Loan Trading Volume:

• 2018 YTD5: $2.6 Billion

• 2017: $2.4 Billion

• 2016: $2.3 Billion

• 2015: $10.7 Billion

• 2014: $8.5 Billion

• 2015: $2.3 Billion

• 2014: $2.4 Billion

Annual High Yield Turnover1 Annual High Yield Trading Volume1

Annual Senior Floating Rate Loan Turnover4 Annual Senior Floating Rate Loan Trading Volume4

46

Rising Interest Rate Environment

High Yield Bonds And Senior Floating Rate Loans Performance In Rising Rate Environment

High Yield Bonds and Loans have historically performed relatively well during rising interest rate environments

Source: J.P. Morgan; S&P/ LCD.

The table presented above represents performance when 5-Year Treasury yields rose 70 basis points (or more) during a 3-month period. High Yield Bond Return is represented by J.P. Morgan Domestic High Yield Index. High Yield

Bond Returns next 3 months represent the 3-month return of the J.P. Morgan High Yield Index for the 3-month period following the 3-months ending period, as listed in the first column of the table above. High Grade Bond Return

prior to 1999 represents Merrill Lynch Corporate Master Index, after 1999 High Grade Bond Return is represented by J.P. Morgan High-Grade Index (JULI). Senior Floating Rate Loans Return prior to 2007 represents S&P

Performing Loans, after 2007 Leveraged Loans are represented by the J.P. Morgan Leveraged Loan Index.

See definitions of indices at the back of this presentation. Past performance is not necessarily indicative of future results. As with any investment, there is the possibility of profit as well as the risk of loss. Historical trends do not

imply, forecast, or guarantee future results. Information is as of the date indicated and subject to change without notice. Nothing herein constitutes a prediction or projection of future events or future market behavior.

3-months

ending:

Increase in

5-year

Treasury

Yields

High Yield

Bond Spreads

Beg Month

(bps)

Spread

Tightening/

Widening

(bps)

High

Yield

Bond

Return

High Yield Bond

Returns

next

3 months

High

Grade

Bond

Return

Senior Floating

Rate Loans

Return

S&P

500

Return

May-87 1.4% 425 -107 -2.8% 4.1% -4.2% NA 2.9%

May-88 1.1% 458 -41 0.5% 1.0% -2.9% NA -1.2%

Mar-90 0.8% 790 4 -2.6% 5.7% -0.7% NA -3.0%

Mar-92 1.0% 729 -239 8.2% 2.5% -0.6% NA -2.6%

Apr-94 1.6% 370 9 -4.8% 1.1% -5.7% 2.3% -5.7%

Nov-94 1.0% 405 8 -0.8% 5.5% -1.9% 1.8% -3.8%

Apr-96 1.2% 461 -80 0.9% 1.9% -3.9% 1.9% 3.5%

Feb-99 0.7% 611 -32 0.2% 2.2% -1.0% 0.7% 6.8%

Jan-00 0.7% 605 -65 2.3% -1.4% 0.1% 2.3% 2.6%

Jan-02 0.9% 991 -171 4.0% 3.0% -0.7% 2.6% 7.0%

Aug-03 1.2% 746 -152 3.3% 6.2% -3.6% 2.1% 5.1%

Jun-04 1.0% 499 -47 -0.4% 4.4% -3.3% 1.2% 1.7%

May-08 1.0% 765 -115 4.0% -3.4% -1.3% 4.6% 5.8%

Jun-09 0.9% 1531 -512 22.5% 15.1% 9.7% 20.4% 15.9%

Dec-10 0.7% 659 -82 3.2% 4.2% -1.8% 3.2% 10.8%

Jul-13 0.7% 469 25 -1.1% 3.0% -4.0% 0.6% 6.1%

Dec-16 0.8% 558 -82 2.6% 2.5% -2.8% 2.2% 3.8%

Average 1.0% 651 -99 2.3% 3.4% -1.7% 3.5% 3.3%

Median 1.0% 605 -80 0.9% 3.0% -1.9% 2.2% 3.5%

47

Trade Policy Implications – Manageable Risk Factor for Non-IG Markets

1. Source: Census.gov. As of December, 31, 20172. Source: Neuberger Berman, BofA Merrill Lynch. Data as of September 30, 2018. Representative of the Bank of America Merrill Lynch U.S. High Yield Index. Note that High Foreign COGS is based on NB estimates of >35% of total COGS

Increased trade barriers may impact sectors with high exposure to foreign based supply chains

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0%

Cell phones and other household goods

Computers

Telecommunications equipment

Computer accessories

Toys, games, and sporting goods

Apparel, textiles, nonwool or cotton

Furniture, household goods, etc.

Other parts and accessories of vehicles

Household appliances

Electric apparatus

Apparel, household goods - cotton

Footwear

Televisions and video equipment

Industrial machines, other

Semiconductors

Photo, service industry machinery

Industrial supplies, other

Cookware, cutlery, tools

Generators, accessories

Other consumer nondurables

US Imports from China: Top 20 Goods1 US High Yield Market Exposure

83%

6%

3%

3%

2%

2%

17%

Index Weight of High Foreign COGS Sectors2

Technology & Electronics

Metals/Mining

Telecom - Wireless

Super Retail

Automotive & Auto Parts

Top 20 Total: 76.7%

48

85%

11%4%

0%

20%

40%

60%

80%

100%

< Interest Cap > Interest Cap w/ Offsets Estimated ModestNegative Impact¹

Corporate Tax Reform – Overview

Tax Reform is expected to have a modestly positive net impact on cash flow for Non-Investment Grade Credit issuers.

• Less than 30% of Non-Investment Grade issuers held by NB portfolios exceed the interest deductibility cap (30% of EBITDA).

• Full expensing of capital expenditures, lower corporate tax rate and other options provide potential offsets.

Sector themes:

• Financials and domestic Industrials are expected to be beneficiaries.

• No sectors are expected to experience a material adverse impact.

Credit quality themes:

• BB and B issuers are expected to experience a modest cash flow benefit.

• CCC issuers are expected to experience a neutral or modestly negative cash flow impact which we estimate at ~1% Free Cash Flow / Debt.

Key Themes in Non-Investment Grade Credit

Source: Neuberger Berman.1. NB Estimates; Analysis included the impact of the combined effects of elimination of deductibility for interest expense greater than 30% of EBITDA, full depreciation of eligible capital expenditures, a lower corporate tax rate of 21%, and any benefit from existing Net Operating Losses (NOLs).NB estimates as of January 2018 based on company filings and presentations. Note that charts are based on issuer count. NB high yield issuers represent all high yield issuers held by NB clients across NB high yield portfolios as of January 2018. NB loan issuers represent all loan issuers held by NB clients across NB loan portfolios. For discussion purposes only. Estimates may not materialize. See Additional Disclosures at the end of this material, which are an important part of this presentation.

67%

27%

6%

0%

20%

40%

60%

80%

100%

< Interest Cap > Interest Cap w/ Offsets Estimated ModestNegative Impact¹

NB High Yield Issuer Breakdown NB Loan Issuer Breakdown

49

Regulatory Environment

Issue Trump Administration Position Potential Implications

Financial Regulation

• Modify or repeal Dodd-Frank

• Reduce regulatory impact of Consumer Financial

Protection Bureau (CFPB)

• Reduced regulatory burden on financials

• Possibility for pro-growth increase in capital availability

International Trade

• Ensure free trade agreements create U.S. jobs; fully

enforce existing agreements

• Renegotiate or withdraw from NAFTA

Potential for disruption to global trade and price inflation

Healthcare Repeal and replace the Affordable Care ActModest negative impact on the hospital sub-sector and

uncertain implications in other healthcare sub-sectors

Infrastructure & Energy• Invest in U.S. infrastructure to support growth

• Advocates reliance on traditional energy

• Positive for infrastructure capex related industries

• Reduced regulatory burden for energy sector

ImmigrationStrict border enforcement including potential for a southern

border wallPotential labor shortages in select sectors and wage inflation

Potential policy impacts

Historical trends do not imply, forecast or guarantee future results. This material is provided for informational purposes only, is as of the date hereof and is subject to change without notice. Neuberger Berman advisors and portfolio

managers may make recommendation or take positions contrary to the views expressed. Nothing herein constitutes a prediction or projection of future events or future market behavior. Due to a variety of factors, actual events or

market behavior may differ significantly from any views expressed.

50

Fixed Income Performance and Relative Value


4.03%3.35%

2.52% 2.35%

0.10%

-0.64% -0.95%-2.33%

4.12%5.23%

7.48%

4.06%

6.78%

2.41% 2.72%

6.18%

-4%

-2%

0%

2%

4%

6%

8%

US Senior FloatingRate Loans

Short Duration USHigh Yield

US High Yield European SeniorFloating Rate Loans²

European High Yield European IG Credit US Treasuries US IG Credit

YTD 30 September 2018 1 January 2017 - 31 December 2017

6.28% 5.77% 5.23%4.07% 3.86% 3.66%

2.70%

1.08%

5.84%5.19% 4.62%

3.25% 3.80%2.81%

2.00%0.75%

0%

2%

4%

6%

8%

10%

US High Yield US Senior FloatingRate Loans

Short Duration USHigh Yield

US IG Credit European SeniorFloating Rate Loans

European High Yield US Treasuries European IG Credit

9/30/2018 12/31/2017

Total Return1

Asset Class Yield Comparison1

Data is as at September 30, 2018. Past performance is not indicative of future returns. You cannot invest directly in an index.1. Source: Barclays, S&P, ICE Bank of America Merrill Lynch. Benchmarks used were the S&P/LSTA Leveraged Loan Index, S&P European Leveraged Loan Index, ICE Bank of America Merrill Lynch U.S. High Yield Index, ICE

Bank of America Merrill Lynch European Currency High Yield Index EUR Hedged, Bloomberg Barclays US Treasury Index, Bloomberg Barclays US Credit Index, Bloomberg Barclays European Credit Index, and ICE Bank of America Merrill Lynch 0-5 Year BB-B US High Yield Constrained Index. See definitions of indices at the back of this presentation. Yield to Worst is shown for bonds and Yield to Maturity is shown for senior floating rate loans. All figures exclude hedging costs.

2. Excluding currency fluctuations.

51

How Do High Yield and Senior Floating Rate Loans Compare to Other Asset Classes?

High Yield Bonds and Loans have historically offered an attractive return for the level of volatility

US Aggregate

Senior Floating Rate Loans

US High Yield

US Equities

UK Equities

Short Duration High Yield

US Treasury

US IG Corporates

EM - Corporate Debt

European High Yield

0%

2%

4%

6%

8%

10%

12%

0% 2% 4% 6% 8% 10% 12% 14% 16%

% A

vera

ge A

nnua

l Ben

chm

ark

Tot

al R

etur

n

% Standard Deviation / Risk

Ten Year Risk / Return Profile

Source: FactSet. All data for the 10 year period ended September 30, 2018.Benchmarks used were Bloomberg Barclays US Aggregate Index, Bloomberg Barclays US Aggregate Treasury Intermediate Index, ICE BofA Merrill Lynch 0 – 5 Year BB-B High Yield Constrained Index, Bloomberg Barclays US Aggregate Credit Corporate Investment Grade Index, CSFB Leveraged Loan Index, ICE BofA Merrill Lynch US High Yield (USD Hedged), ICE BofA Merrill Lynch European Currency Non-Financial High Yield 3% Constrained (USD Hedged), FTSE 100 USD Total Return Index, S&P 500 Total Return Index, and JPM CEMBI Diversified (linked) Index. See definitions of indices at the back of this presentation. Indices are unmanaged and are not available for direct investments. Investing entails risks, including possible loss of principal.

Past performance is not necessarily indicative of future results. As with any investment, there is the possibility of profit as well as the risk of loss. Historical trends do not imply, forecast, or guarantee future results

52

APPENDICES

INVESTMENT TEAM

Biographies

BUSINESS MANAGEMENT

Brad C. Tank, Managing Director, joined the firm in 2002 after 23 years of experience in trading and asset management. Brad is the Chief

Investment Officer and Global Head of Fixed Income. He is a member of Neuberger Berman’s Operating, Investment Risk , Asset Allocation

Committees and Fixed Income’s Senior Management Committee. From 1990 to 2002, Brad was director of fixed income for Strong Capital

Management in Wisconsin. He was also a member of the Office of the CEO and headed institutional and intermediary distribution. In 1997, Brad

was named “Runner Up” for Morningstar Mutual Fund Manager of the Year. From 1982 to 1990, he was a vice president at Salomon Brothers in

the government, mortgage and financial institutions areas. Brad earned a BBA and an MBA from the University of Wisconsin.

PORTFOLIO MANAGEMENT TEAM

Thomas O’Reilly, CFA, Managing Director, joined the firm in 1997. Tom is the Global Head of Non-Investment Grade Credit and is also a Senior

Portfolio Manager for High Yield and Blended Credit portfolios. Tom serves on the firm’s Partnership Committee and is a member of the

investment team setting overall portfolio strategy. Tom had previously been a high yield analyst at Stein Roe and Bank of America for eight years.

Tom earned a BS in Finance from Indiana University, an MBA from Loyola University, and has been awarded the Chartered Financial Analyst

designation.

Vivek Bommi, CFA, Managing Director, joined the firm in 2007. Vivek is a Senior Portfolio Manager on Global and European non-investment

grade portfolios. In addition, he sits on the Credit Committee for high yield bonds and senior floating rate loans. Prior to joining the firm, Vivek

worked in the leverage finance groups at The Carlyle Group and Banc of America Securities. He started his career as an investment analyst at

Intel Capital. Vivek earned a BS from the University of Illinois, an MBA from Columbia Business School, has been awarded the Chartered

Financial Analyst designation and is a Certified Public Accountant.

Stephen Casey, CFA, Managing Director, joined the firm in 2002. Stephen is a Senior Portfolio Manager for Non-Investment Grade Credit

focusing on loan portfolios. In addition, he sits on the Credit Committee for high yield bonds and senior floating rate loans. Stephen was a

founding partner of LightPoint Capital Management LLC, which was acquired by Neuberger Berman in 2007. Prior to joining LightPoint, he was

employed at ABN AMRO where he was responsible for structuring highly leveraged transactions. In 2016, Stephen was elected to a two year term

on the Loan Syndications and Trading Association (LSTA) Board of Directors. He received a BS from Indiana University, an MS from the Illinois

Institute of Technology and has been awarded the Chartered Financial Analyst designation.

55

Biographies

Russ Covode, Managing Director, joined the firm in 2004. Russ serves as a Senior Portfolio Manager for high yield and blended credit portfolios.

In addition, he sits on the Credit Committee for high yield bonds and senior floating rate loans. Prior to joining the firm, Russ spent five years at

Banc One Capital Markets, where he was most recently a principal in the bank’s mezzanine fund. Before that, he spent seven years with the high

yield group at Banc of America Securities in various positions including leading the bank’s high yield capital markets desk. Russ began his career

with S.G. Warburg & Co. in New York. Russ earned a BA from Colorado College and an MBA from the University of Chicago.

Daniel Doyle, CFA, Managing Director, joined the firm in 2012. Dan serves as a Senior Portfolio Manager for non-investment grade credit

portfolios. In addition, he sits on the Credit Committee for high yield bonds and senior floating rate loans. Prior to joining the firm, Dan was a

managing director at SunTrust Robinson Humphrey, specializing in high yield sales. He was also a portfolio manager at various firms, including

Henderson Global Investors, ING Investment Management and Zurich Scudder Investments. Dan began his career at the Federal Reserve Bank

of Chicago. Dan earned a BS from Northern Illinois University and an MBA from the University of Chicago. He has also been awarded the

Chartered Financial Analyst designation.

Patrick Flynn, CFA, Managing Director, joined the firm in 2006. Patrick is a Senior Portfolio Manager for non-investment grade credit portfolios.

In addition, he sits on the Credit Committee for high yield bonds and senior floating rate loans. He came to the firm with more than 15 years of

experience, including positions with Putnam Investments, JP Morgan Chase and UBS. Most recently, Patrick served as director of research for

DDJ Capital Management, LLC. He holds an AB from Columbia University, an MBA from the University of Chicago and has been awarded the

Chartered Financial Analyst designation.

Joseph Lind, CFA, Managing Director, joined the firm in 2018. Joe is a Senior Portfolio Manager for non-investment grade credit U.S. high yield

portfolios. In addition, he sits on the Credit Committee for high yield bonds and senior floating rate loans. Joe comes to the firm with more than 19

years of experience, including 12 years at DDJ Capital Management where he served as a portfolio manager in their U.S. High Yield and

Opportunistic strategies. Before DDJ, Joe worked for Coast Asset Management, Sierra Capital and The Helios Group. Joe earned a BA from

Harvard University and has also been awarded the Chartered Financial Analyst designation.

56

Biographies

Joseph Lynch, Managing Director, joined the firm in 2002. Joe is a Senior Portfolio Manager for Non-Investment Grade Credit focusing on loan

portfolios. In addition, he sits on the Credit Committee for Non-Investment Grade Credit and serves on Neuberger Berman’s Investment Risk

Committee. Joe was a founding partner of LightPoint Capital Management LLC, which was acquired by Neuberger Berman in 2007. Prior to

joining LightPoint, he was employed at ABN AMRO where he was responsible for structuring highly leveraged transactions. Joe earned a BS from

the University of Illinois and an MBA from DePaul University.

Martin Rotheram, Managing Director, joined the firm in 2006. Martin is a Senior Portfolio Manager and Senior Research Analyst based in London

and is part of the global Non-Investment Grade Credit team, with a focus on European Credit and loan portfolios. In addition, he sits on the Credit

Committee for high yield bonds and senior floating rate loans. Martin was a portfolio manager at LightPoint Capital Management Europe, which

was acquired by Neuberger Berman in 2007. Prior to joining LightPoint, he was a director of acquisition finance at CIC, a manager of corporate

finance at Sumitomo Trust & Banking and held various positions at Arbuthnot Latham Private Bank and National Westminster Bank. Martin is an

associate of the Chartered Institute of Bankers and holds the Investment Management Certificate.

Pim Van Schie, Managing Director, joined the firm in 2015. Pim is a Senior Portfolio Manager focusing on Collateralized Loan Obligation (CLO)

strategies. Pim was an Executive Director of CLO Banking and Firm Corporate Credit Market Risk at Morgan Stanley. Prior to that, he was a Vice

President on the CLO Banking team at BNP Paribas. Pim earned a BS from Louisiana State University and an MBA from New York University.

57

Biographies

RESEARCH AND PORTFOLIO ANALYSTS

Christopher Kocinski, CFA, Managing Director, joined the firm in 2006. Chris is Co-Director of Non-Investment Grade Credit Research and a

Senior Research Analyst with a specific focus on the healthcare and gaming sectors. In addition, he is a member of the Credit Committee for

high yield bonds and senior floating rate loans as well as the firm’s ESG Advisory Committee. Prior to joining the firm, he was an investment

banking analyst at Bank of America Securities. Chris earned a BA from the University of Chicago and has been awarded the Chartered Financial

Analyst designation.

Steven Ruh, CFA, Senior Vice President, joined the firm in 2007. Steven is Co-Director of Non-Investment Grade Credit Research, a Senior

Research Analyst and Sector Team Leader of the energy team with a specific focus on the gas distribution sector. In addition, he is a member of

the Credit Committee for high yield bonds and senior floating rate loans. Prior to joining the firm, he worked as an investment banking analyst at

RBC Capital Markets. Steven earned a BA from the University of Chicago and has been awarded the Chartered Financial Analyst designation.

Ian Bates, CFA, Senior Vice President, joined the firm in 2014. Ian is a Senior Research Analyst and Trader with the European Non-Investment

Grade Credit team. Ian covers the utilities, healthcare, basic industry, real estate and financial services sectors. Prior to joining the firm, he was a

senior portfolio manager at AXA Investment Managers, focusing on European credit. Previous experience includes a credit research and analyst

role at Blackrock. Ian earned a BA from University of Nottingham and has been awarded the Chartered Financial Analyst designation.

\

Brian Bunker, CFA, Vice President, joined the firm in 2012. Brian is a Senior Research Analyst on the consumer team with a specific focus on

the healthcare and financials sectors. Prior to his current role, he specialized in analyzing and monitoring the composition and performance of

the high yield portfolios as a portfolio analyst. Previously, he served as an associate at BMO Capital Markets and a senior research assistant at

the Federal Reserve Board. Brian earned a BA from the University of North Carolina – Chapel Hill and a Master in Finance from Princeton

University. He has also been awarded the Chartered Financial Analyst designation.

58

Biographies

Darren Carter, Senior Vice President, joined the firm in 2015. Darren is a Senior Research Analyst on the Telecommunications, Media and

Technology team. Prior to joining the firm, he was a Managing Director at Orchard Square Partners, with a focus on the telecommunications,

media and technology sectors. Previously, Darren held research related roles at Arx Investment Management, and was an investment banker at

Morgan Stanley. Darren earned a BBA from Texas A&M University, and a JD from the University of Southern California

David DeCoste, CFA, Senior Vice President, joined the firm in 2005. David is a Senior Research Analyst and cyclical team leader with a specific

focus on the manufacturing, homebuilding, and aerospace sectors. Prior to joining the firm, he held various positions at William Blair, UBS Global

Asset Management and ABN AMRO. David earned a BS from the University of Notre Dame, an MBA from the University of Chicago and has

been awarded the Chartered Financial Analyst designation.

Colin Donlan, Senior Vice President, joined the firm in 2002. Colin is a Senior Manager in the Firm’s Operations Department, and manages the

Structured Products Support and Bank Loan Administration teams. Colin specializes in monitoring and compliance of the senior floating rate loan

portfolios. Prior to joining the firm, he was a vice president of the asset-backed securities trust services group at LaSalle Bank. Colin earned a

BA from Denison University and an MBA from DePaul University.

Jared Feeney, CFA, Vice President, joined the firm in 2013. Jared is a Senior Research Analyst on the Non-Investment Grade Credit team with a

specific focus on the cable and technology sectors. Prior to joining the firm, he held various positions at J.P. Morgan including high yield credit

research and institutional sales. Jared earned a BBA from the University of Notre Dame and an MBA from Northwestern University. He has also


59

Biographies

Neil Frank, CFA, Senior Vice President, joined the firm in 2011. Neil is a Senior Research Analyst on the consumer team focusing on the

packaging, food/beverage and consumer products sectors. Prior to joining the firm, he worked as an analyst at various firms including Deerfield

Capital Management, Credit Suisse and Brock Associates. Neil earned a BS from the University of Illinois and an MBA from the University of

Wisconsin. He has also been awarded the Chartered Financial Analyst designation.

Robert Gephardt, CFA, Senior Vice President, joined the firm in 2007. Robert is a Senior Research Analyst on the energy team with a specific

focus on the energy and utility sectors. Robert earned a BS from Indiana University and an MBA from Northwestern University. He has also been

awarded the Chartered Financial Analyst designation.

Brian Giffney, Senior Vice President, joined the firm in 2017, and is a Senior Credit Analyst on the European Non-Investment Grade Credit team.

Previously, Brian was a Principal in the European Leveraged Finance Credit team at PGIM Fixed Income for 11 years. He began his career as a

Credit Analyst at Allied Irish Bank in 1999. Brian holds a Master’s degree in Economics from the University College Dublin.

Tyler Gile, CFA, joined the firm in 2015. Tyler is a Portfolio Analyst and specializes in analyzing / monitoring the composition and performance of

the high yield and loan portfolios. Previously, he served as a client reporting associate specializing on non-investment grade credit portfolios. Prior

to joining the firm, he served as an Investment Consulting Associate at Mercer Investments. Tyler earned a BBA from the University of South

Carolina and has also been awarded the Chartered Financial Analyst designation.

60

Biographies

Alex Hankin, CFA, joined the firm in 2014. Alex is a Research Analyst on the Non-Investment Grade Credit team with a specific focus on the

energy and chemicals sectors. Prior to joining the firm, he was a Neuberger Berman intern in the summer of 2013. Alex earned a BS in Business

Administration with a concentration in Finance from Indiana University. He has been awarded the Chartered Financial Analyst designation.

Laura Homsy, Senior Vice President, joined the firm in 2014. Laura is a Senior Research Analyst with the European Non-Investment Grade

Credit team. Prior to joining the firm, she was a publishing credit analyst at HSBC Bank plc, focusing on the high yield telecoms, media and

technology sectors, as well as covering investment grade telecoms, consumer and retail. Previously, Laura held a desk analyst role at the

Proprietary Positioning Business at JPMorgan Chase, as well as two years as an analyst in the M&A TMT Advisory team at JPMorgan Chase.

Laura earned a Masters with Honors in International Business from University of Edinburgh.

Adam Howaniec, joined the firm in 2015. Adam is a Research Analyst on the Non-Investment Grade Credit team with a specific focus on the

consumer sector. Prior to joining the firm, he was a Neuberger Berman intern in the summer of 2014. Adam earned a BS in Business

Administration with a concentration in Finance from Indiana University.

Michael Keegan, CFA, Vice President, joined the firm in 2012. Michael is a Portfolio Analyst and specializes in analyzing / monitoring the

composition and performance of the high yield portfolios. Previously, he served as a client reporting associate on the Client Reporting team. Prior

to joining the firm, Michael held analyst positions at CB Richard Ellis and Aon. Michael earned a BBA from Marquette University, an MBA from

Boston College and has also been awarded the Chartered Financial Analyst designation.

61

Biographies

Jonathan Levine, CPA, Senior Vice President, joined the firm in 2014. Jonathan is a Senior Research Analyst with a specific focus on the

telecommunications sector. Prior to joining the firm, he was a senior credit analyst with Aviva Investors. Previous experience also includes analyst

and associate positions at Jefferies Group, JPMorgan Chase and Salomon Smith Barney. Jonathan earned a BS from Yeshiva University and an

MBA from New York University. He is also a Certified Public Accountant.

Hardik Makkar, CFA, Vice President, joined the firm in 2016. Hardik is a Senior Research Analyst with the European Non-Investment Grade

Credit team. Prior to joining the firm, he was an associate desk analyst at The Seaport Group Europe, focusing on high yield and event driven

credit research. Previously, Hardik held associate roles at Barclays Capital and Deutsche Bank Group. He earned a Bachelor of Technology in

Chemical Engineering from the Indian Institute of Technology Kanpur and a Master’s in Finance from the London Business School. Hardik has


Mark Menapace, CFA, Senior Vice President, joined the firm in 2012. Mark is a Senior Research Analyst and TMT team leader with a specific

focus on the media and technology sectors. Prior to joining the firm, he was a senior analyst at Citadel Investment Group, focusing on long/short

fundamental credit. Previous experience includes a vice president role at Citigroup Global Markets. Mark earned a BS from Cornell University and

has been awarded the Chartered Financial Analyst designation.

Christopher Miller, Senior Vice President, joined the firm in 2017. Christopher is a Senior Research Analyst and Director of Capital Markets. He

also serves as Cyclicals Team Leader with a specific coverage focus on the chemicals, automotive and services industries. Christopher leads

Non-IG Capital Markets efforts with a primary focus on high yield and financial sponsors. Prior to joining the firm, he was a Senior Research

Analyst at Global Credit Advisers, focusing on cyclical sectors. Previously, Chris held several research related roles at JPMorgan where he was

most recently a Managing Director and Co-Leader of the High Yield Desk Analysts within their North American Credit Trading effort. Christopher

earned a BS from Santa Clara University and an MBA from Washington University in St. Louis.

62

Biographies

Brandon Mulroe, CFA, Vice President, joined the firm in 2007. Brandon is a Senior Research Analyst on the consumer and cyclicals teams with a

specific focus on the leisure, entertainment, and services sectors. Brandon earned a BS from Indiana University and an MBA from Northwestern

University. Brandon has also been awarded the Chartered Financial Analyst designation.

Ophelia Ng, joined the firm in 2017. Ophelia is an Analyst focusing on Collateralized Loan Obligation (CLO) strategies. Prior to joining Neuberger

Berman, Ophelia was a securitized products research analyst at Nomura covering Agency RMBS and CLO. Prior to working in the financial

industry, Ophelia was a principal dancer at a world class performing arts company. Ophelia received a BA in Financial Economics from Columbia

University.

Allison Norman, CFA, joined the firm in 2015. Allison is a Research Analyst with a specific focus on the cyclicals team. Prior to joining the firm,

she was at Octagon Credit Investors in New York in a similar role. Allison earned a BS in Economics with concentrations in Finance and Global

Analysis from the University of Pennsylvania, Wharton School. She has been awarded the Chartered Financial Analyst designation.

Paul Raskin, CFA, joined the firm in 2016. Paul is an Analyst focusing on Collateralized Loan Obligation (CLO) strategies. Prior to joining the firm,

he was an associate at PwC specializing in fixed-income credit analysis and structuring. Paul earned a BS in Finance and Accounting from

Georgetown University. He has been awarded the Chartered Financial Analyst designation.

63

Biographies

Henry Reukauf, Senior Vice President, joined the firm in 2016. Henry is a Senior Research Analyst on the consumer and cyclicals teams with a

specific focus on the metals / mining and healthcare sectors. Prior to joining the firm, he was a Senior Research Analyst at Deutsche Bank where he

was recognized by Institutional Investor for his work on the healthcare sector and was named to the All-America Fixed-Income Research Team for 8

consecutive years. Prior to this, he held various credit underwriting positions at Credit Lyonnais America with a focus on the healthcare sector.

Henry earned a BA in Economics from Wake Forest University and an MBA from Fordham University with a concentration in Finance.

Tom Tharayil, Vice President, joined the firm in 2018. Tom is a Research Analyst on the European Non-Investment Grade Credit team. Previously,

Tom was a Senior Credit Analyst in the European Leveraged Finance Credit team at Medirect Strategy. Prior to that, Tom spent his associate and

analyst years at HSBC and Credit Suisse in their Leveraged Finance origination teams, respectively. Tom holds a master’s degree in Computer

Science from the University of Cambridge and a bachelor’s degree in Engineering from Anna University.

Rick Veitch, joined the firm in 2017. Rick is a Research Analyst on the Non-Investment Grade Credit team working with the cyclicals and

telecommunications teams. Prior to joining the firm, he was a Neuberger Berman intern in the summer of 2016. Rick earned a BS in Business

Administration with a concentration in Finance from Indiana University.

64

Biographies

Wen Yao, CFA, Vice President, joined the firm in 2018. Wen is a Senior Research Analyst on the TMT team with a specific focus on the technology

and media sectors. Prior to joining the firm, she held various positions at J.P. Morgan including analyst roles within the High Yield Credit Research,

Chief Investment Office and Investment Banking groups. Wen earned a Master of Arts in Economics from New York University and a BA in

Economics from Beijing Jiaotong University. She has also been awarded the Chartered Financial Analyst designation.

Rachel Young, Senior Vice President, joined the firm in 2016. Rachel is a Senior Research Analyst and Consumer team leader with a specific

focus on the financials and retail sectors. Prior to joining the firm, she was a Senior Analyst and Team Leader in financials at Janus Capital. In

addition to her analyst responsibilities, she also served on the Janus Operating Committee. Rachel earned a BA and MBA from the University of

Denver.

65

Biographies

CLIENT PORTFOLIO MANAGERS

Ravi Chintapalli, CFA, Senior Vice President, joined the firm in 2007. Ravi is a Client Portfolio Manager, serving the Non-Investment Grade team’s

North American clients and prospects. In addition, he works alongside Senior Portfolio Managers on day-to-day portfolio management

responsibilities. Prior to his current role, Ravi served as Senior Portfolio Analyst for the Non-Investment Grade team. Before joining the firm, he

served in various roles at DWS Scudder Investments. Ravi earned a BS from the University of Illinois and an MBA from the University of Chicago.

He has also been awarded the Chartered Financial Analyst designation.

Alex Gitnik, PhD, Managing Director, joined the firm in 2017. Alex is a Client Portfolio Manager on the Fixed Income team, where he represents the

broad range of the firm’s fixed income strategies in the institutional and intermediary marketplaces across the EMEA region. Prior to joining the firm,

Alex worked at Standard Life Investments, where he was the Investment Director/Senior Global Investment Specialist for Fixed Income and

Absolute Return. Before that, Alex was at Wellington Management working as a Portfolio Specialist for their Global Credit and Absolute Bond suite

of strategies. He began his career in 1997, having spent time at a number of banks in a variety of Fixed Income roles. Alex earned an MBA from

The Wharton School of Business and holds a PhD and MS in Economics from Saratov State Socio-Economic University.

Adam Grotzinger, CFA, Senior Vice President, joined the firm in 2015. Adam is a Client Portfolio Manager based in Singapore and serves as the

lead representative for the Neuberger Berman Fixed Income team in Asia. Prior to joining Neuberger Berman, he was a Senior Portfolio Specialist

at Franklin Templeton Investments where he lived and worked in various geographic locations including Singapore, London and California, and

represented the Franklin Templeton Fixed Income Group's Global, European, Asian, Emerging Market, and Credit strategies in the respective

regions. Adam graduated Cum Laude from the University of Vermont with a B.S. in International Business and a minor in Political Science. He is a

Chartered Financial Analyst (CFA) Charterholder and member of the Singapore CFA society.

TRADERS

John Abendroth, CFA, Senior Vice President, joined the firm in 2004. John is a member of the Portfolio Construction team and is responsible for

trading cyclical sectors in the high yield and loan portfolios. He came to the firm after six years with The Northern Trust Company where his

experience included high yield credit analysis and trading. John earned a BA from Washington State University, an MBA from DePaul University

and has been awarded the Chartered Financial Analyst designation.

66

Biographies

_______________________The years listed above include the year an employee joined Neuberger Berman (or its affiliate) or a company acquired by Neuberger Berman or its predecessor. For those employees listed above who joined the firm as part of the LightPoint Capital Management LLC ("LightPoint") acquisition in 2007, the year they joined the firm represents the year they joined LightPoint.

TRADERS (Continued)

John Lingbeck, Senior Vice President, joined the firm in 2012. John is responsible for trading in the high yield and loan portfolios. He joins the

firm most recently from Citadel, where he was a Credit Trader for the Fundamental Credit Group. Prior to joining Citadel, John held various

positions at Franklin Templeton. John earned a BS from Santa Clara University and received his Certificate in Credit Analysis from New York

University.

Quinn Murphy, Trading Associate, joined the firm in 2015. Quinn began his current role in 2017 and is responsible for trading in the high yield and

loan portfolios. Prior to joining the trading desk, Quinn was in an operational role supporting high yield and bank loan trading. He has passed Level

1 of the CFA Program. Quinn earned a BA in Finance from Butler University.

William O’Connor, CFA, Senior Vice President, joined the firm in 2013. Bill is responsible for trading in the high yield and loan portfolios. Bill joined

the firm from UBS Investment Bank, where he was an executive director specializing in high yield and leveraged loan sales and syndications. Prior

to UBS, he worked at Lehman Brothers as a vice president in leveraged credit sales. Bill’s experience also includes domestic and international

corporate strategy and business development roles at CME Group and Orchestra Capital Advisors. Bill began his career as a capital markets

analyst at PaineWebber. Bill has a BS from Boston College and an MBA from the University of Chicago. He has been awarded the Chartered

Financial Analyst designation.

RISK MANAGEMENT

John Sun, CFA, Senior Vice President, joined the firm in 2008. John is the Director of the Fixed Income Risk Analysis Team. In this role, he is

responsible for producing bottom-up analysis that enables portfolio managers to budget portfolio risk and top-down analysis that gives overview

information to clients, product development and senior management. Previously he worked for Morgan Stanley (risk management), Citigroup’s

Global Corporate and Investment Bank (risk analytics), Deloitte & Touche’s Capital Market Strategy (financial institution practice) and State Street

(enterprise risk management). John earned a PhD in Information Systems from Columbia University, an MBA from Darden School of Business at

the University of Virginia, has been awarded the Chartered Financial Analyst designation and is a member of the New York Society of Security

Analysts.

67

ADDITIONAL INFORMATION

Our Collaborative Approach Across Asset Classes

Setting goals, measuring performance and driving ESG priorities across the firm

ESG Investing Team

• Primary responsibility is setting and implementing the global ESG

strategy by deepening the integration of ESG themes into new and

existing investment strategies

• Participates in the investment performance review of all investment

teams chaired by each platform’s Chief Investment Officer to review

the degree of ESG integration

The ESG Committee

• Chaired by the Head of ESG Investing, oversees the firmwide ESG

efforts, including the review of goals and priorities such as the

development of new ESG-integrated investment strategies

• Monitors implementation, measures performance and contributes to

annual reporting to groups like the United Nations-supported

Principles for Responsible Investment (PRI)

• Acts as a cross-asset class forum to share research on ESG issues

and trends, and to drive deeper engagement and education on ESG

topics across the firm

Asset Class-Specific ESG Working Groups

• Responsible for providing context-specific expertise and assisting with

education and implementation among the investment teams

Three levels of collaborationRESEARCH

Tim Creedon

Head of Equity Research

Steve Flaherty

Head of Investment

Grade Research

Chris Kocinski

Co-Head of Non-Investment

Grade Credit Research

Irina Babushkina

Equity Research

James Lyman

Head of Municipal Fixed

Income Research

CLIENT COVERAGE

Dik van Lomwel

Head of EMEA and Latin

America

Raluca Pencu

Head of RFP

INVESTMENT TEAMS

Jonathan Bailey

Head of ESG Investing

Joseph Amato

President and CIO—Equities

Lawrence Kohn

Chief Operating Officer—Equities

Ingrid Dyott

Co-Portfolio Manager—Sustainable

Equity Group

Gorky Urquieta

Co-Head of Emerging Markets Debt

Rob Drijkoningen

Co-Head of Emerging Markets Debt

Maura Reilly Kennedy

Managing Director, Private Equity

Erik Knutzen

Co-Head of QMAC and CIO—MAC

SUPPORT AND CONTROL

Dina Lee

Associate General Counsel

Chrystelle Charles-Barral

Risk Management

ESG Committee

69

Neuberger Berman’s PRI Assessment Scores

2018 2017 2016

Neuberger

Berman

Peer

Median

Neuberger

Berman

Peer

Median

Neuberger

Berman

Peer

Median

01. Strategy & Governance A+ A A A A B

Indirect – Manager Sel., App & Mon

07. Private Equity A+ C B B C B

Direct & Active Ownership Modules

10. Listed Equity – Incorporation A+ B A A A A

11. Listed Equity – Active Ownership A B B B B B

12 Fixed Income – SSA A+ B A B A C

14. Fixed Income – Corporate Non-

FinancialA+ B B B B C

15. Fixed Income - Securitized - - B E B E

For illustrative and discussion purposes only. PRI scores are based on information reported directly by PRI signatories, of which investment managers totaled 1,120 for 2018, 935 for 2017 and 790 for 2016. All signatories are eligible to participate and must complete a questionnaire to be included. The underlying information submitted by signatories is not audited by the PRI or any other party acting on its behalf. Signatories report on their responsible investment activities by responding to asset-specific modules in the Reporting Framework. Each module houses a variety of indicators that address specific topics of responsible investment. Signatories’ answers are then assessed and results are compiled into an Assessment Report. The Assessment Report includes indicator scores – summarizing the individual scores achieved and comparing them to the median; section scores – grouping similar indicator scores together into categories (e.g. policy, assurance, governance) and comparing them to the median; module scores – aggregating all the indicator scores within a module to assign one of six performance bands (from E to A+). Awards and ratings referenced do not reflect the experiences of any Neuberger Berman client and readers should not view such information as representative of any particular client’s experience or assume that they will have a similar investment experience as any previous or existing client. Awards and ratings are not indicative of the past or future performance of any Neuberger Berman product or service.The scores under each column are based on the previous year’s reporting activity. Moreover, the underlying information has no t been audited by the PRI or any other party acting on its behalf. While every effort has been made to produce a fair representation of performance, no representations or warranties are made as to the accuracy of the information presented, and no responsibility or liability can be accepted for damage caused by use of or reliance on the information contained within this report.

In 2018, of the 69 investment managers with $250 billion or more in assets, only eight received three or more A+ grades that included one

for overall strategy and governance and at least one for an equity and one for a fixed income category.

70

Systematic ESG Engagement Approach

• Engage with regulators and market

infrastructure providers

• Recent examples include engaging with

S&P and Moody’s regarding ESG

integration into credit ratings

• Publish timely and relevant insights at

nb.com/esg

• “Rating the Raters on ESG”

• “Engaging in ESG”

• “Non-IG Engagement Case

Studies”

• Industry-level collaboration with

established organizations such as UN

PRI, SASB and others

• ESG Engagement Tracker

• Track objectives, outcomes and

progress at the issuer and

industry levels

• Identify engagement priorities

which contribute towards

Sustainable Development Goals

(SDGs)

• Quarterly ESG Review reported to Credit

Committee

• Review of current priorities

• Assess performance impacts

and develop data over-time

DIRECT ISSUER

ENGAGEMENT

MARKET-WIDE

INITIATIVESEVALUATE PROGRESS

NB leverages our scale and research depth to drive ESG engagement and credit enhancement


• Non-IG research analysts conduct

engagements on factors most relevant to

credit risk in each industry based on our

proprietary ESG Scoring System

• > 400 ESG engagements over the

past 18 months

• Company-specific engagement

• Long-term strategy and

incentives

• Management of material Social

and Environmental risks

• Sector-specific engagement

• Multiple issuers within the

same sector

• Recent examples include

incentive structures in the Oil &

Gas industry

71

ESG Engagement Case Study

NB platform drives credit enhancement through ESG engagement

0.7%

0.9%

1.1%

1.3%

1.5%

45

145

245

345

445

AVOL 5.5 '24 OAS (LHS) AVOL Issuer Active Weight (RHS)

Source: Neuberger Berman, Bloomberg.No recommendation or advice is being given as to whether the above investment is suitable. It should not be assumed that any investment will be profitable.This supplemental report is provided for informational purposes only; please refer to your account statement(s) or other statement provided by your custodian for the official records of your account(s). Investing entails risks, including possible loss of principal. Past performance is no guarantee of future results. See Additional Disclosures at the end of this presentation.Above example was selected solely based upon its illustrative value regarding demonstrating how the investment process incorporates ESG factors; no other basis or criteria were used in the selection of the example shown.

1H17

4 meetings with management

Focal points:

• Shareholder, governance, legal framework discussion

• Call with Bohai management to discuss outlook, investment strategy, and governance structure

• CIT integration

• Improving credit metrics/Investment grade objective

2H17


Focal points:

• Intercompany loan and capital allocation

• Governance structure and board independence

• Business impact of HNA market concerns

YTD18


Focal points:

• Elevated market concerns regarding HNA liquidity profile

• Encourage structural bondholder protections

Outcome: Avolon voluntarily instituted credit enhancing covenant protections and

material governance improvements following 15+ engagements by NB since 1Q17.

Issuer: Avolon Holdings is the 3rd largest global aircraft lessor.

Background: Market concerns regarding the company’s ownership and governance

structures led to volatility in trading levels.

NB Engagement: 15+ meetings with Avolon management since 1Q17

Engagement Focal Points:

• Strengthen existing separation framework

• Reinforce independent governance structure

• Commitment to transparent capital allocation strategy

• Maintain credit profile consistent with stated investment grade objective

Avolon Representative Bond and Active Issuer Weight

Timeline of NB Engagement

72

Examples of ESG Engagement

Industry Objective Engagement Outcome

Healthcare Evaluate New Issuance

• Discussed aggressive pricing of

medicines with senior management

• Identified lack of willingness to

change current practices

• NB Non-IG declined to invest in the

issuer, which subsequently defaulted

after facing pricing/volume pressures

Energy Request for Additional Disclosure

• Requested additional disclosure on a

key operational issue

• Identified weaknesses in corporate

governance and encouraged greater

future transparency

• NB Non-IG sold out of the position

following inadequate issuer response

Financials Request for Additional Disclosure

• Informed senior management of low

third-party ESG scores and

disclosure deficiencies

• Issuer enhanced disclosures within

12 months

• Assigned management member to

address ESG considerations

Utilities Issuer Education

• Informed senior management team

of importance of ESG transparency

and disclosure

• Positive response from senior level

management of issuer

• Next steps under evaluation at issuer

• NB Non-IG tracking progress

Cyclicals Request for Company Action

• Request to sign global agreement

related to core business

• Joint engagement from NB Non-IG

Credit and Equity teams

• Issuer is considering action

• NB Non-IG tracking progress

_______________________For illustrative purposes only. This material is intended as a broad overview of the portfolio managers’ style, philosophy and investment process and is subject to change without notice. See Disclosures at the end of this presentation, which are an important part of this presentation.

73

7369 68

63 6260 57 57

45

0

10

20

30

40

50

60

70

80

NB

ES

G S

core

Environmental Social Governance

Non-Investment Grade Credit ESG Scoring Example

Services Sector Case Study

Example NB ESG Score Distribution – Services Sector

Issuer A B C D E F G H I

NB Internal Rating BB B B B+ BB BB- BBB- BB B-

Moody’s Rating Ba3 B2 B2 B1 Ba2 Ba3 Ba1 Ba2 B2

S&P Rating BB- B B+ B+ BB+ BB- BB+ BB B

Top 5% Bottom 5%


74

DISCLOSURES




_______________________Source: Neuberger Berman. The management of the Neuberger Berman High Yield Bond Fund has been delegated to Neuberger Berman Investment Advisers LLC.1. Periods less than one year are not annualized.2. USD Institutional Share Class; net of annualized management charge of 0.60%.3. Fund Inception May 3, 2006.4. As of September 30, 2018.5. Please check with your Neuberger Berman representative to see if these share classes are available at this time.MORNINGSTAR RATING © 2018 Morningstar Inc. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or it’s content providers: (2) may not be copied or distributed: and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor it’s content providers are responsible for any damages or losses arising from any use of this information. Ratings are representative of the USD Institutional Accumulating share class


KEY CHARACTERISTICS

Morningstar RatingTM

Base Currency / AUM: USD / $4.6B4

Fund Structure: UCITS

Domicile / Regulator: Dublin; Central Bank of Ireland

Fund Charges5: Institutional Class “I” 0.60%; Adviser Class “A” 1.20%

Valuation: Daily

Returns1

Neuberger Berman

High Yield Bond Fund2

(Net of Fees )

(%)


U.S. High Yield

Constrained Index

(%)

Difference

(%)

Annualized

Tracking Error

(%)

Information

Ratio

3Q 2018 2.18 2.44 -0.26 - -

YTD 2018 1.87 2.52 -0.65 - -

1 Year 1.82 2.94 -1.12 - -

3 Years 6.41 8.20 -1.79 1.238 -1.442

5 Years 4.01 5.55 -1.54 1.127 -1.364

10 Years 8.68 9.40 -0.72 2.551 -0.284

Since Inception3 7.11 7.39 -0.28 2.470 -0.113

(05/03/06 - 09/30/2018)

76

U.S. High Yield Composite (Inception 12/1/1997)

Investment Performance Results – As of September 30, 2018

Past performance is no guarantee of future results.Please see attached important disclosures which contain complete performance information and definitions.

Composite Benchmark Composite 3 Year Standard Deviation

Total Return

(%, Gross

of Fees)

Total Return

(%, Net

of Fees)

ICE BofAML US

HY Master II

Constrained

Index (%)

No. of

Accounts

Market Value

($, m)

Total Firm

Assets

($, bn)

% of Firm

Assets

Internal

Dispersion

Composite

(%)

ICE BofAML US

HY Master II

Constrained Index

(%)

YTD Sep-

20182.47 2.17 2.52 26 6,904.7 -- -- -- 4.16 4.89

2017 6.21 5.78 7.48 30 9,866.1 295.2 3.34 0.07 5.00 5.59

2016 15.22 14.76 17.49 25 8,222.6 255.2 3.22 0.17 5.59 6.01

2015 -3.73 -4.12 -4.61 24 6,392.1 240.4 2.66 0.17 5.63 5.26

2014 2.38 2.00 2.51 24 7,466.8 250.0 2.99 0.08 5.15 4.44

2013 8.09 7.72 7.41 24 7,630.5 241.7 3.16 0.10 7.41 6.43

2012 15.99 15.61 15.55 21 6,841.4 205.0 3.34 0.14 8.13 7.02

2011 4.54 4.11 4.37 21 6,777.4 193.1 3.51 0.32 11.05 10.96

2010 15.64 15.18 15.07 12 4,882.1 80.1 6.10 0.37 -- --

2009 53.11 52.64 58.10 11 3,587.6 75.8 4.73 2.54 -- --

2008 -17.47 -17.77 -26.11 11 2,249.9 78.8 2.86 0.73 -- --

77

U.S. High Yield Composite

Investment Performance Disclosure Statement

Compliance Statement• Neuberger Berman Group LLC ("NB", "Neuberger Berman" or the "Firm") claims compliance with the Global Investment Performance Standards (GIPS®) and has prepared and presented this report in compliance with the GIPS® standards. Neuberger

Berman was independently verified for the period January 1, 2011 to December 31, 2016. The GIPS® firm definition was redefined effective January 1, 2011. For prior periods there were two separate firms for GIPS® firm definition purposes and such firmswere independently verified for the periods January 1, 1997 to December 31, 2010 and January 1, 1996 to December 31, 2010, respectively. Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS® standards on a firm-wide basis and (2) the firm's policies and procedures are designed to calculate and present performance in compliance with the GIPS® standards. The NB Full Market High Yield composite has been examined for the periods January 1, 1998 to December 31, 2016. The verification and performance examination reports are available upon request.

Definition of the Firm• The firm is currently defined for GIPS® purposes as Neuberger Berman Group LLC, ("NB", "Neuberger Berman" or the "Firm"), and includes the following subsidiaries: Neuberger Berman Investment Advisers LLC, Neuberger Berman Europe Ltd., Neuberger

Berman Asia Ltd., Neuberger Berman East Asia Ltd., Neuberger Berman Singapore Pte. Ltd., Neuberger Berman Taiwan Ltd, Neuberger Berman Australia Pty. Ltd., Neuberger Berman Trust Company N.A., Neuberger Berman Trust Company of Delaware N.A. and NB Alternatives Advisers LLC.

Policies• Policies for valuing portfolios, calculating performance, and preparing compliant presentations are available upon request.Composite Description• The U.S. High Yield Composite (the "Composite") includes the performance of all fee-paying U.S. High Yield portfolios, with no minimum investment, managed on a fully discretionary basis by the Non Investment Grade Fixed Income team. The U.S. High

Yield strategy is designed for investors who seek to achieve returns relative to a broad high yield bond index. The emphasis is on avoidance of credit deterioration, sector rotation and relative value bond selection. The Composite creation and performance inception date is December 1997. A complete list of Neuberger Berman's composites is available upon request.

Primary Benchmark Description• The benchmark is the ICE BofAML U.S. High Yield Master II Constrained Index (the "Index"). The index is designed to measure the performance of below investment grade US dollar-denominated corporate bonds publicly issued in the US domestic market,

including 144a issues. The benchmark is calculated on a total return basis. Additional disclosures for complete benchmark descriptions are available upon request.Reporting Currency• Valuations are computed and performance is reported in U.S. Dollars.Fees• Composite Gross of Fee returns are the return on investments reduced by any trading expenses incurred during the period. Composite Net of Fee returns are the Gross of Fee returns reduced by investment advisory fees.Fee Schedule• The annual investment advisory fee, generally payable quarterly, is as follows: 0.55% on the first $50mn; 0.45% on the next $250mn; 0.35% thereafter. Internal Dispersion• Internal dispersion is calculated using the asset-weighted standard deviation of annual gross returns of those portfolios that were in the Composite for the entire year. Internal dispersion is not calculated if the Composite does not contain at least 6 portfolios

for the entire year.Annualized Standard Deviation• The three-year annualized standard deviation measures the variability of the Composite and the benchmark returns over the preceding 36-month period. The standard deviation is not required for periods prior to 2011.

78

Index Definitions

INDEX DEFINITIONS

Credit Suisse Leveraged Loan Index: The Credit Suisse (“CS”) Leveraged Loan (“LL”) is an index designed to mirror the investable universe of the $US-denominated leveraged loan market. The index

inception is January 1992. The index frequency is monthly. New loans are added to the index on their effective date if they qualify according to the following criteria: Loans must be rated “5B” or lower; only

fully- funded term loans are included; the tenor must be at least one year; and the Issuers must be domiciled in developed countries (Issuers from developing countries are excluded). Fallen angels are added

to the index subject to the new loan criteria. Loans are removed from the index when they are upgraded to investment grade, or when they exit the market (for example, at maturity, refinancing or bankruptcy

workout).

ICE Bank of America Merrill Lynch 1-10 Year US Treasury Index: The ICE BofA Merrill Lynch 1-10 Year US Treasury Index is a subset of the ICE BofA Merrill Lynch US Treasury Index including all

securities with a remaining term to final maturity less than 10 years.

ICE Bank of America Merrill Lynch European Currency High Yield Constrained Index: This index contains all securities in the ICE BofA Merrill Lynch European Currency High Yield Index but caps issuer

exposure at 3%. Index constituents are capitalization weighted, based on their current amount outstanding, provided the total allocation to an individual issuer does not exceed 3%. Issuers that exceed the limit

are reduced to 3% and the face value of each of their bonds is adjusted on a pro-rata basis. Similarly, the face values of bonds of all other issuers that fall below the 3% cap are increased on a pro-rata basis. In

the event there are fewer than 34 issuers in the Index, each is equally weighted and the face values of their respective bonds are increased or decreased on a pro-rata basis.

ICE Bank of America Merrill Lynch US Corporate Index: The ICE BofA Merrill Lynch US Corporate Index tracks the performance of U.S. dollar denominated investment grade corporate debt publicly issued

in the U.S. domestic market. Qualifying securities must have an investment grade rating (based on an average of Moody’s, S&P and Fitch) and an investment grade rated country of risk (based on an average

of Moody’s, S&P and Fitch foreign currency long term sovereign debt ratings). In addition, qualifying securities must have at least one year remaining term to final maturity, a fixed coupon schedule and a

minimum amount outstanding of $250 million. Original issue zero coupon bonds, “global” securities (debt issued simultaneously in the Eurobond and U.S. domestic bond markets), 144a securities and pay-in-

kind securities, including toggle notes, qualify for inclusion in the Index. Callable perpetual securities qualify provided they are at least one year from the first call date. Fixed-to-floating rate securities also qualify

provided they are callable within the fixed rate period and are at least one year from the last call prior to the date the bond transitions from a fixed to a floating rate security. DRD-eligible and defaulted securities

are excluded from the Index.

ICE Bank of America Merrill Lynch 0-5 Year BB-B US High Yield Constrained Index: This index tracks the performance of short-term US dollar denominated below investment grade corporate debt publicly

issued in the US domestic market. Qualifying securities must have less than five years remaining term to final maturity, at least 18 months to final maturity at point of issuance, be rated BB1 through B3,

inclusive, based on an average of Moody’s, S&P and Fitch, have a fixed coupon schedule and a minimum amount outstanding of $250 million.

ICE Bank of America Merrill Lynch US High Yield Index: This index tracks the performance of US dollar denominated below investment grade corporate debt publicly issued in the US domestic market.

Qualifying securities must have a below investment grade rating (based on an average of Moody’s, S&P and Fitch), at least 18 months to final maturity at the time of issuance, at least one year remaining term

to final maturity as of the rebalancing date, a fixed coupon schedule and a minimum amount outstanding of $250 million.

ICE Bank of America Merrill Lynch US High Yield Constrained Index: This index tracks the performance of below investment grade U.S. dollar-denominated corporate bonds publicly issued in the U.S.

domestic market, including 144a issues. Yankee bonds (debt of foreign issuers issued in the U.S. domestic market) are included in the index provided the issuer is domiciled in a country having an investment

grade foreign currency long-term debt rating (based on a composite of Moody’s and S&P). Qualifying bonds must have at least one year remaining to maturity, a fixed coupon schedule and a minimum amount

outstanding of $250 million. Qualifying bonds are capitalization-weighted provided the total allocation to an individual issuer (defined by Bloomberg tickers) does not exceed 2%. Issuers that exceed the limit are

reduced to 2% and the face value of each of their bonds is adjusted on a pro-rata basis. Similarly, the face value of bonds of all other issuers that fall below the 2% cap are increased on a pro-rata basis.

79

Index Definitions

INDEX DEFINITIONS

The Bloomberg Barclays EM USD Aggregate Index: This index is a flagship hard currency Emerging Markets debt benchmark that includes USD denominated debt from sovereign, quasi-sovereign, and

corporate EM issuers. The index is broad-based in its coverage by sector and by country, and reflects the evolution of EM benchmarking from traditional sovereign bond indices to Aggregate-style benchmarks

that are more representative of the EM investment choice set. Country eligibility and classification as an Emerging Market is rules-based and reviewed on an annual basis using World Bank income group and

International Monetary Fund (IMF) country classifications. This index was previously called the Barclays US EM Index and history is available back to 1993.

The Bloomberg Barclays Euro-Aggregate Corporate Index: This index consists of bonds issued in the euro or the legacy currencies of the 16 sovereign countries participating in the European Monetary

Union (EMU). All issues must be investment grade rated, fixed-rate securities with at least one year remaining to maturity. The Euro-Aggregate Index excludes convertible securities, floating rate notes,

perpetual notes, warrants, linked bonds, and structured products. German Schuldscheine (quasi-loan securities) are also excluded because of their trading restrictions and unlisted status, which results in

illiquidity. The country of issue is not an index criterion, and securities of issuers from outside the Eurozone are included if they meet the index criteria.

The Bloomberg Barclays Intermediate U.S. Treasury Index: The Barclays Intermediate U.S. Treasury Index represents public obligations of the U.S. Treasury with a remaining maturity of one year or more.

This index is the U.S. Treasury component of the U.S. Government index.

The Bloomberg Barclays Municipal Bond Index: The Barclays Municipal Bond Index is a rules-based, market-value-weighted index engineered for the long-term tax-exempt bond market. To be included in

the index, bonds must be rated investment-grade (Baa3/BBB- or higher) by at least two of the following ratings agencies: Moody's, S&P, Fitch. If only two of the three agencies rate the security, the lower rating

is used to determine index eligibility. If only one of the three agencies rates a security, the rating must be investment-grade. They must have an outstanding par value of at least $7 million and be issued as part

of a transaction of at least $75 million. The bonds must be fixed rate, have a dated-date after December 31, 1990, and must be at least one year from their maturity date. Remarketed issues, taxable municipal

bonds, bonds with floating rates, and derivatives, are excluded from the benchmark.

The Bloomberg Barclays U.S. Aggregate Index: The Barclays U.S. Aggregate Index represents securities that are SEC-registered, taxable, and dollar denominated. The index covers the U.S. investment

grade fixed rate bond market, with index components for government and corporate securities, mortgage pass-through securities, and asset-backed securities. These major sectors are subdivided into more

specific indices that are calculated and reported on a regular basis.

The Bloomberg Barclays U.S. Aggregate Credit Corporate Investment Grade Index: The Index represents publicly issued U.S. corporate and specified foreign debentures and secured notes that meet the

specified maturity, liquidity, and quality requirements. To qualify, bonds must be SEC-registered. The index includes both corporate and non-corporate sectors. The corporate sectors are Industrial, Utility, and

Finance, which include both U.S. and non-U.S. corporations. The non-corporate sectors are Sovereign, Supranational, Foreign Agency, and Foreign Local Government.

The Bloomberg Barclays U.S. High Yield Index: The Barclays U.S. High Yield Index covers the universe of fixed rate, non-investment grade debt. Eurobonds and debt issues from countries designated as

emerging markets (sovereign rating of Baa1/BBB+/BBB+ and below using the middle of Moody’s, S&P, and Fitch) are excluded, but Canadian and global bonds (SEC registered) of issuers in non-EMG

countries are included. Original issue zeroes, step-up coupon structures, 144-As and pay-in-kind bonds (PIKs, as of October 1, 2009) are also included.

FTSE 100 Index: The FTSE 100 is a market-capitalization weighted index of UK-listed blue chip companies. The index is part of the FTSE UK Series and is designed to measure the performance of the 100

largest companies traded on the London Stock Exchange that pass screening for size and liquidity. FTSE 100 constituents are all traded on the London Stock Exchange’s SETS trading system.

80

Index Definitions

INDEX DEFINITIONS

J.P. Morgan CEMBI Diversified Index: This index includes USD-denominated emerging market corporate bonds. The CEMBI Diversified/CEMBI Broad Diversified, limits the weights of those index countries

with larger corporate debt stocks by only including a specified portion of these countries' eligible current face amounts of debt outstanding.

J.P. Morgan EMBI Global Diversified Index: This index includes US dollar denominated Brady bonds, Eurobonds, and traded loans issued by sovereign and quasi-sovereign entities. The EMBI

Global/Diversified defines country eligibility rules with a combination of income based criteria and sovereign long-term credit rating criteria. These multi-dimensional rules allow the EMBI Global/Diversified to

include a number of higher-rated countries that international investors have nevertheless considered part of the emerging markets universe. The EMBI Global Diversified Index limits the weights of those index

countries with larger debt stocks by only including a specified portion of these countries’ eligible current face amounts of debt outstanding.

J.P. Morgan Global High Yield Index: The J.P. Morgan Global High Yield Index consists of fixed income securities of domestic and foreign issuers with a maximum credit rating of BB+ or Ba1.

S&P 500 Index: The S&P 500 Index is a capitalization weighted index comprised of 500 stocks chosen for market size, liquidity, and industry group representation. The S&P 500 Index is constructed to

represent a broad range of industry segments in the U.S. economy. The S&P 500 focuses on the large-cap segment of the market with over 80% coverage of US equities. Criteria for inclusion include financial

stability (minimize turnover in the index), screening of common shares to eliminate closely held companies and trading activity indicative of ample liquidity and efficient share pricing. Companies in merger,

acquisition, leveraged-buy-outs, bankruptcy (Chapter 11 filing or any shareholder approval of recapitalization which changes a company’s debt-to-equity ratio), restructuring, or lack of representation in their

representative industry groups are eliminated from the index.

S&P/LSTA European Leveraged Loan Index: The S&P/LSTA European Leveraged Loan Index is comprised of four indices: Multi-Currency Index: all facilities; LBO Index: facilities to issuers backed by a

private equity firm; Euro Index: Euro denominated facilities; Euro LBO Index: Euro denominated facilities to issuers backed by a private equity firm. Each of the indexes reflects the market-weighted

performance of institutional leveraged loan portfolios investing in European credits in that segment. All the index components are loans syndicated to European loan investors. The ELLI series represents the

only European leveraged loan indexes that utilize real-time market weightings, spreads and interest payments.

S&P/LSTA Leveraged Loan Index: The S&P/LSTA Leveraged Loan index is a daily total return index that uses LSTA/LPC Mark-to-Market Pricing to calculate market value change. On a real-time basis, the

S&P/LSTA Leveraged Loan index tracks the current outstanding balance and spread over LIBOR for fully funded term loans. The facilities included in the index represent a broad cross section of leveraged

loans syndicated in the United States, including dollar-denominated loans to overseas issuers.

S&P/LSTA U.S. Leveraged Loan 100 Index: The S&P/LSTA Leveraged Loan 100 Index is a market value-weighted index designed to measure the performance of the U.S. leveraged loan market. The index

consists of 100 loan facilities drawn from a larger benchmark - the S&P/LSTA (Loan Syndications and Trading Association) Leveraged Loan Index (LLI), which covers more than 900 facilities and had a market

value of more than US$ 490 billion on June 30th, 2011. As of June 30, 2011, the S&P/LSTA U.S. Leveraged Loan 100 Index had a total market value of US$ 183.4 billion.

81

Index Definitions

INDEX DEFINITIONS

U.S. Treasury: 1-3 Year: Securities in the Treasury Index (i.e., public obligations of the U.S. Treasury) with a maturity from 1 up to (but not including) 3 years.

U.S. Credit Description: Publicly issued U.S. corporate and specified foreign debentures and secured notes that meet the specified maturity, liquidity, and quality requirements. To qualify, bonds must be SEC-

registered.

U.S. Treasury: Public obligations of the U.S. Treasury with a remaining maturity of one year or more. Exclusions:

•Treasury bills are excluded (because of the maturity constraint).

•Certain special issues, such as flower bonds, targeted investor notes (TINs), and state and local government series (SLGs) bonds are excluded.

•Coupon issues that have been stripped are reflected in the index based on the underlying coupon issue rather than in stripped form. Thus STRIPS are excluded from the index because their inclusion would

result in double counting. However, for investors with significant holdings of STRIPS, customized benchmarks are available that include STRIPS and a corresponding decreased weighting of coupon issues.

•Treasuries not included in the Aggregate Index, such as bills, coupons, and bellwethers, can be found in the index group Other Government on the Index Map.

•As of December 31, 1997, Treasury Inflation-Protection Securities (Tips) have been removed from the Aggregate Index. The Tips index is now a component of the Global Real index group.

U.S. Treasury Bills: 1-3 Months: The Barclays Treasury Bill Index includes U.S. Treasury bills with a remaining maturity from 1 up to (but not including) 12 months. It excludes zero coupon strips.

82

Disclosures

Style Group Rankings Information:

Member count statistics do not reflect indexes. Rankings information does not reflect the experiences of any client of Neuberger Berman and readers should not view the rankings information as

representative of any particular client’s experience or assume that they will have a similar investment experience as any previous or existing client. The rankings information is not indicative of Neuberger

Berman’s past or future performance.

eVestment is an innovative, Web-based provider of comprehensive investment information and analytic technology. eVestment delivers extensive data through robust, user-friendly products with an

unparalleled commitment to client service. Through its online Global Database, eVestment captures the most comprehensive dataset in the industry and distributes all information via its fully Web-based

Analytics system, a platform which has set the software standard for online manager comparisons, research and competitive intelligence. Drawing upon its data management expertise, eVestment also

offers its powerful Omni system to address the industry's redundant data request problems by automating the transformation and precise update of manager data to multiple databases. With better data,

more flexible analytics and custom data automation and delivery platforms, eVestment’s robust tools enable clients to conduct more thorough research, generate more insightful analysis, and significantly

improve their overall efficiency.

eVestment US High Yield Fixed Income: US Fixed Income products that invest primarily in High Yield debt (as rated by Moody’s or Standard & Poor’s). The expected benchmarks for this universe would

include the Barclays Capital High Yield, Credit Suisse High Yield, or Merrill Lynch High Yield Master. Managers in this category will typically indicate a “Fixed Income Style Emphasis” equal to High Yield and

a “Product Duration Emphasis” equal to Core or Intermediate.

1-Year Rank 3-Year Rank 5-Year Rank 10-Year Rank

U.S. High Yield 6.20 78 5.62 66 5.45 62 8.73 8

5th Percentile 10.62 5 8.28 5 7.71 5 9.03 5

25th Percentile 8.24 25 6.72 25 6.19 25 8.19 25

Median 7.50 50 6.06 50 5.71 50 7.63 50

75th Percentile 6.47 75 5.31 75 5.06 75 7.05 75

95th Percentile 4.19 95 3.68 95 3.63 95 5.70 95

BofA ML US High Yield Constrained 7.48 50 6.40 35 5.81 45 7.96 34

Additional Average Annualized Returns & Peer Rankings as of December 31, 2017

83

Additional Disclosures

Institutional-Oriented Equity and Fixed Income AUM Benchmark Outperformance Note: Institutional-oriented equity and fixed income assets under management (“AUM”) includes the firm’s equity and fixed

income institutional separate account (“ISA”), registered fund, and managed account/wrap (“MAG”) offerings and are based on the overall performance of each individual investment offering against its

respective benchmark offerings and are based on the overall performance of each individual investment offering against its respective benchmark. High net worth/private asset management (“HNW”) AUM

is excluded. For the period ending June 30, 2018, the percentage of total institutional-oriented equity AUM outperforming the benchmark was as follows: Since Inception: 90%; 10-year: 44%; 5-year: 78%;

and 3-year: 73%; and total institutional-oriented fixed income AUM outperforming was as follows: Since Inception: 95%, 10-year: 82%; 5-year: 69%; and 3-year: 68%. If HNW AUM were included, total equity

AUM outperforming the benchmark was as follows: Since Inception: 88%; 10-year: 31%; 5-year: 55%; and 3-year: 53%; and total fixed income AUM outperforming was as follows: Since Inception: 94%; 10-

year: 82%; 5-year: 69%; and 3-year: 68%. Equity and Fixed Income AUM outperformance results are asset weighted so individual offerings with the largest amount of assets under management have the

largest impact on the results. As of 6/30/2018, six institutional-oriented equity offerings accounted for approximately 54% of the total firm institutional-oriented equity AUM reflected, and nine institutional-

oriented fixed income offerings accounted for approximately 53% of the total firm institutional-oriented fixed income AUM reflected. Performance for the individual offerings reflected are available upon

request. AUM for multi-asset class, balanced and alternative (including long-short equity or fixed income) offerings, as well as AUM for hedge fund, private equity and other private investment vehicle

offerings are not reflected in the AUM outperformance results shown. AUM outperformance is based on gross of fee returns. Gross of fee returns do not reflect the deduction of investment advisory fees and

other expenses. If such fees and expenses were reflected, AUM outperformance results would be lower. Investing entails risk, including possible loss of principal. Past performance is no guarantee of

future results.

Private Equity Outperformance Note: The performance information includes all funds, both commingled and custom, managed by NB Alternatives Advisers LLC with vintage years of 2005 – 2015, with the

exception of a closed-end, public investment company registered under the laws of Guernsey (the “Funds”). Accounts that are only monitored are excluded. Vintage years post 2015 are excluded as

benchmark information is not yet available. Please note that private debt funds are also excluded as benchmark data is not yet available for the applicable vintages.

Percentages are based on the number of funds, calculated as the total number of funds whose performance exceeds their respective benchmarks divided by the total number of all funds with vintage years

of 2005 through 2015. Performance is measured by net IRR, MOIC, and DPI and is compared to the respective index’s median net IRR, MOIC and DPI, respectively. The Cambridge Secondary Index was

used for secondary-focused funds; the Cambridge Buyout and Growth Equity for US and Developed Europe was used for co-investment-focused funds; the Cambridge Fund of Funds Index was used for

commingled funds and custom portfolios comprised of primaries, secondaries and co-investments; and the Cambridge Global Private Equity was used for strategies focused on minority stakes in asset

managers fund and healthcare credit.

The Cambridge Associates LLC indices data is as of December 31, 2017, which is the most recent data available. The Cambridge Associates Fund of Funds Index is the benchmark recommended by the

CFA Institute for benchmarking overall private equity fund of funds performance. The benchmark relies on private equity funds self-reporting data for compilation and as such is subject to the quality of the

data provided. The median net multiple of Cambridge Associates Fund of Funds Index is presented for each vintage year as of December 31, 2017, the most recent available. Cambridge Associates data

provided at no charge.

While one of the secondary funds closed in 2008, Cambridge Associates classifies that particular fund as a 2007 vintage year fund (the year of its formation) and, therefore, the Cambridge Associates

benchmarks used herein are for 2007 vintage year funds.

Private Offerings: Certain strategies referenced herein may only be available through a private offering of interests made pursuant to offering and subscription documents, which will be furnished solely to

qualified investors on a confidential basis at their request for their consideration in connection with an offering. These documents will contain information about the investment objective, terms and conditions

of an investment in such vehicle and will also contain tax information and risk disclosures that are important to an investment decision. Any decision to invest in such vehicle should be made after a careful

review of these documents, the conduct of such investigations as an investor deems necessary or appropriate and after consultation with legal, accounting, tax and other advisors in order to make an

independent determination of the suitability and consequences of an investment in such vehicle.

84

Additional Disclosures (continued)

Credit quality generally reflects the average credit quality of three Nationally Recognized Statistical Ratings Organizations (NRSROs), S&P, Moody’s and Fitch, as calculated internally by the investmentadviser. Holdings that are unrated by any NRSRO may be assigned an equivalent rating by the investment manager. If NRSRO ratings differ for a particular holding, the average rating is generally used.No NRSRO has been involved with the calculation of average credit quality and the ratings of underlying portfolio holdings should not be viewed as a rating of the portfolio itself. Portfolio holdings,underlying ratings of holdings and average credit may change materially overtime.

Representative portfolio information (characteristics, holdings, weightings, etc.) is based upon the composite or a representative/model account. Representative accounts are selected based on such factorsas size, length of time under management and amount of restrictions. Any segment level performance shown (equity only or fixed income only) is presented gross of fees and focuses exclusively on theinvestments in that particular segment of the portfolio being measured (equity or fixed income holdings) and excludes cash. Client accounts are individually managed and may vary significantly fromcomposite performance and representative portfolio information. Specific securities identified and described do not represent all of the securities purchased, sold or recommended for advisory clients. Itshould not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable.

A bond’s value may fluctuate based on interest rates, market conditions, credit quality and other factors. You may have a gain or loss if you sell your bonds prior to maturity. Of course, bonds are subject tothe credit risk of the issuer. If sold prior to maturity, municipal securities are subject to gain/losses based on the level of interest rates, market conditions and the credit quality of the issuer. Income may besubject to the alternative minimum tax (AMT) and/or state and local taxes, based on the investor’s state of residence. High-yield bonds, also known as “junk bonds,” are considered speculative and carry agreater risk of default than investment-grade bonds. Their market value tends to be more volatile than investment-grade bonds and may fluctuate based on interest rates, market conditions, credit quality,political events, currency devaluation and other factors. High yield bonds are not suitable for all investors and the risks of these bonds should be weighed against the potential rewards. Neither NeubergerBerman nor its employees provide tax or legal advice. You should contact a tax advisor regarding the suitability of tax-exempt investments in your portfolio.

Gross returns do not reflect the deduction of advisory fees and other expenses, which will reduce returns. Investment advisory fees have a compounding effect on cumulative results. For example, assumeNeuberger Berman achieves a 10% annual return prior to the deduction of fees each year for a period of ten years. If an annual advisory fee of 1.00% of assets under management for the ten-year periodwere charged, the resulting annual average return after fees would be reduced to 8.90%. Performance results will vary based upon the period measured. Additional information regarding fees can be foundin Neuberger Berman’s Form ADV, Part 2, which is available upon request.

Statements contained herein are based on current expectations, estimates, projections, opinions and/or beliefs of Neuberger Berman. Such statements involve known and unknown risks, uncertainties andother factors, and undue reliance should not be placed thereon. Moreover, certain information contained herein constitutes “forward looking” statements, which often can be identified by the use of forwardlooking terminology such as “may,” “will,” “seek,” “should,” “expect,” “anticipate,” “project,” “estimate,” “intend,” “continue,” “target,” “plan” or “believe” or the negatives thereof or other variations thereon orcomparable terminology. Such statements are necessarily speculative in nature, as they are based on certain assumptions. It can be expected that some or all of the assumptions underlying suchstatements will not reflect actual conditions. Accordingly, there can be no assurance that any estimated projections, forecast or estimates will be realized or that the forward looking statements willmaterialize. Due to various risks and uncertainties, including those set forth herein, actual events or results or the actual performance of any security referenced herein may differ materially from thosereflected or contemplated in such forward looking statements.

All information as of the date indicated. Firm data, including employee and assets under management figures, reflect collective data for the various affiliated investment advisers that are subsidiaries ofNeuberger Berman Group LLC (the “firm”). Firm history and timelines include the history and business expansions of all firm subsidiaries, including predecessor entities and acquisition entities. Investmentprofessionals referenced include portfolio managers, research analysts/associates, traders, and product specialists and team dedicated economists/strategists.

This material is being issued on a limited basis through various global subsidiaries and affiliates of Neuberger Berman Group LLC. Please visit http://www.nb.com/disclosure-global-communications for thespecific entities and jurisdictional limitations and restrictions.

85

http://”http/www.nb.com/disclosure-global-communications”

Additional Disclosures (continued)

NEUBERGER BERMAN FIXED INCOME SECTOR VIEWS AND RETURN ESTIMATES

Return Estimates May Not Materialize. Neuberger Berman investment views and estimates are formulated by our specialty fixed income teams. For a variety of fixed income sectors we identify a range ofoutcomes that either may occur or alternatively be anticipated and then priced into the market. For each sector we formulate an investment view based on proprietary fundamental research and quantitativeanalysis which are used to project return estimates and a confidence level associated with the return outlook. Each sector team will establish an independent view based on internal research, and a level ofconfidence in the outlook. The sector view is formulated by identifying various states of the economy and market (i.e. outcomes) estimation typically over a 12-month horizon. Each state or outcome isprobability weighted to determine the overall sector view. View Uncertainty quantifies the confidence of the return estimate by measuring return standard deviation across the “states of the world”. A widerdispersion of the states of the world, represented by a larger standard deviation, indicates a lower degree of confidence, or, a higher degree of uncertainty. The reassessment of sector views is ongoing andformally updated at least monthly. Sector views should not be construed as research or investment advice and do not constitute a recommendation to buy, sell or hold securities in any sector.

The return estimates contained herein are being shown to illustrate the investment decision-making process and are not intended to provide any predictions or guarantee about the future returns of anysecurity, asset class or portfolio. Projections or other forward-looking statements regarding future events, targets or estimations/expectations are only current as of the date indicated. There is no assurancethat such events or projections will occur, and may be significantly different than that shown here. The information in this presentation, including statements concerning financial market trends, is based oncurrent market conditions, which will fluctuate and may be superseded by subsequent market events or for other reasons.

The return estimates presented represent approximate mid-points within a range of targeted yields, spreads and returns and are presented only as an example of how Neuberger Berman may construct aportfolio based on its views of the credit markets and sub-markets. The returns presented are an economic prediction and are the views of the portfolio manager as of the date hereof and are subject tochange. Return estimates are based on qualitative and quantitative analysis of historical and current information. There is no assurance that the returns presented will be realized or that an investmentstrategy will be successful. Investors should keep in mind that markets are volatile and unpredictable. There are no guarantees that the historical performance of an investment, portfolio, or asset class willhave a direct correlation with its future performance. Generally, our 12-month and 24-month views and estimates are an input in our asset allocation decisions.

Neuberger Berman believes the return estimates set forth herein is reasonable based on a combination of factors, including the investment team’s general experience and assessment of prevailing marketconditions and investment opportunities. There are, however, numerous assumptions that factor into the return estimates that may not be consistent with future market conditions and that may significantlyaffect actual investment results. Such assumptions include, but are not limited to, 1) current monetary policy, inflation estimates and other fundamental and technical factors determine interest rate levels inthe credit markets, 2) historical data and trends in the fixed income asset classes presented and 3) anticipated interest rate movements. Neuberger Berman does not make any representation as to thereasonableness of the assumptions or that all the assumptions used in calculating the return estimates have been stated or fully considered. Neuberger Berman’s ability to achieve investment resultsconsistently, in the aggregate or with regard to any particular fixed income sector, with the returns set forth herein depends significantly on a number of factors in addition to the accuracy of its assumptions.These include Neuberger Berman’s ability to identify a sufficient number and mix of suitable investments. Changes in the assumptions may have a material impact on the targeted returns presented. All datais shown before fees, transaction costs and taxes and does not account for the effects of inflation. Management fees, transaction costs and potential expenses are not considered and would reduce returns.Actual results experienced by clients may vary significantly from the illustrations shown.

86

DisclaimerThis document is addressed to professional clients only.

This document is a financial promotion and is issued by Neuberger Berman Europe Limited, which is authorised and regulated by the Financial Conduct Authority and is registered in England and Wales, at

Lansdowne House, 57 Berkeley Square, London, W1J 6ER and is also a Registered Investment Adviser with the Securities and Exchange Commission in the U.S. and regulated by the Dubai Financial Services

Authority.

This fund is a sub-fund of Neuberger Berman Investment Funds PLC, authorised by the Central Bank of Ireland pursuant to the European Communities (Undertaking for Collective Investment in Transferable

Securities) Regulations 2011, as amended. The information in this document does not constitute investment advice or an investment recommendation and is only a brief summary of certain key aspects of the fund.

Investors should read the prospectus and the key investor information document (KIID) which are available on our website: http://www.nb.com/_layouts/www/legal-documents.aspx. Investment objectives, risk

information, fees and expenses and other important information about the fund can be found in the prospectus.

Notice to investors in Switzerland: Neuberger Berman Investment Funds plc is established in Ireland as an investment company with variable capital incorporated with limited liability under Irish law, and the sub-

funds are also authorised by the Swiss Financial Market Supervisory Authority FINMA for distribution to non-qualified investors in and from Switzerland. The Swiss representative and paying agent is BNP Paribas

Securities Services, Paris, succursale de Zurich, Selnaustrasse 16, 8002 Zürich, Switzerland. The prospectus, the key investor information documents, the memorandum and articles of association and the annual

and semi-annual reports are all available free of charge from the representative in Switzerland.

This document is presented solely for information purposes and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security.

We do not represent that this information, including any third party information, is accurate or complete and it should not be relied upon as such.

No recommendation or advice is being given as to whether any investment or strategy is suitable for a particular investor. Each 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.

It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable.

Any views or opinions expressed may not reflect those of the firm as a whole.

All information is current as of the date of this material and is subject to change without notice.

The fund described in this document may only be offered for sale or sold in jurisdictions in which or to persons to which such an offer or sale is permitted. The fund can only be promoted if such promotion is made in

compliance with the applicable jurisdictional rules and regulations. This document and the information contained therein may not be distributed in the US.

Indices are unmanaged and not available for direct investment.

An investment in the fund involves risks, with the potential for above average risk, and is only suitable for people who are in a position to take such risks. For more information please read the prospectus which can

be found on our website at: http://www.nb.com/_layouts/www/legal-documents.aspx.

Past performance is not a reliable indicator of current or 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 performance data does

not take account of the commissions and costs incurred on the issue and redemption of units.

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.

Tax treatment depends on the individual circumstances of each investor and may be subject to change, investors are therefore recommended to seek independent tax advice.

Investment in the fund should not constitute a substantial proportion of an investor’s portfolio and may not be appropriate for all investors. Diversification and asset class allocation do not guarantee profit or protect

against loss.

No part of this document may be reproduced in any manner without prior written permission of Neuberger Berman Europe Limited.

The “Neuberger Berman” name and logo are registered service marks of Neuberger Berman Group LLC.

© 2018 Neuberger Berman Group LLC. All rights reserved. M 145406

87

neuberger berman high yield bond fund - beconim › fundspdf › neuberger berman › fixed... ·...

Documents