At this time, I'd like to welcome everyone to the Barings BDC Inc. Conference Call for the Quarter Ended March 31, 2025. All participants are in a listen-only mode. A question-and-answer session will follow the company's formal remarks. [Operator Instructions]. Today's call is being recorded and a replay will be available approximately two hours after the conclusion of the call on the company's website at www.baringsbdc.com, under the Investor Relations section. At this time, I'll turn the call over to Joe Mazzoli, Head of Investor Relations for Barings BDC. Please go ahead, Joe.

Good morning, and thank you for joining today's call. Please note that this call may contain forward-looking statements that include statements regarding the company's goals, beliefs, strategies, future operating results, and cash flows. Although the company believes these statements are reasonable, actual results could differ materially from those projected in forward-looking statements. These statements are based on various underlying assumptions and are subject to numerous uncertainties and risks, including those disclosed under the sections titled Risk Factors and Forward-Looking Statements in the company's quarterly report on Form 10-Q for the quarter ended March 31, 2025, as filed with the Securities and Exchange Commission. Barings BDC undertakes no obligation to update or revise any forward-looking statements, unless required by law. I will now turn the call over to Eric Lloyd, Chief Executive Officer of Barings BDC.

Thanks, Joe, and good morning, everyone. We appreciate you joining us for today's call. Please note that throughout today's call, we'll be referring to our first quarter 2025 earnings presentation that is posted on the Investor Relations section of our website. On the call today, I'm joined by Barings BDC's President, Matt Freund; Chief Financial Officer, Elizabeth Murray; and Barings' Head of Global Private Finance and BBDC Portfolio Manager, Bryan High. In the first quarter, BBDC delivered another strong and consistent set of results, fueled by leading credit performance and supported by the scale and stability of our franchise. The uptick in origination activity that we noted during the fourth quarter continued into the first three months of 2025, with net originations of more than $100 million during the period. Strong deployment combined with a benign credit environment and our focus on the top of the capital structure investments and middle market issuers combined to serve our investors well. Our focus on the core of the middle market is driven by the sector's low leverage levels and more attractive risk-adjusted returns, which is why we find this to be the best segment of the market for BBDC and our shareholders. Further, we have strong alignment with the broader Barings LLC ecosystem, focusing on sectors that will perform with resilience across economic environments. This combination of senior secured financing solutions, core middle market focus, and defensive non-cyclical sectors worldwide offers our investors strong relative value and portfolio differentiation compared to the broader BBDC sector. Consistent with how we have defined our strategy in the past discussions, our portfolio strategy is outlined in greater detail on Slide 5, and we continue to successfully invest throughout the market and deliver compelling returns to our shareholders. As you will have seen in our press…

Thanks, Eric. I'd like to start by discussing how the macroeconomic landscape is currently impacting our issuer base and how we have worked to understand and triage anticipated challenges. Following the presidential inauguration, our team began analyzing the impacts of prospective tariffs should the administration choose to pursue them. Recall that we lived this journey during 2020 and anticipated some degree of tariff impact in light of the rhetoric during the 2024 election cycle. In mid-February, we reached out to nearly 200 issuers within the portfolio to understand how prospective tariffs would impact their businesses. The takeaways at that time suggested that issuers that we defined as having, quote, a high impact consisted of less than 5% of the portfolio. Perhaps not surprisingly, the issuers which presented the largest concern operated in industries such as manufacturing, industrial technologies and international sourcing. Following April 2nd, we again engaged the issuer base, most of whom we had remained in active dialogues with and determined that the initial indications on risk were directionally accurate, but the secondary levels of impact were of greater concern, given the broad nature of the initial policy measures that were rolled out. Specifically, issuers across a host of industries expressed the possibility that a meaningful amount of downstream impact related to tariffs were possible, but were difficult to assign a probability. Taking a step back, what we ultimately learned in speaking with the issuers on this topic was that the tariffs in and of themselves do not pose the greatest concern to the majority of our borrowers. More than 80% of the issuer base is providing services, domestic sourcing and other businesses generating the majority of their revenues from non-tariff impacted industries. The most direct consequence rather, of the current trade discussions has resulted in an effective freeze…

Thanks, Matt. As Eric and Matt have said, BBDC is performing well and demonstrating solid core earnings power of our portfolio while preserving leading credit quality and generating attractive yield for our fellow shareholders. We are especially excited about the coming increases to that earnings power as we are able to rotate more of our assets into income-producing investments with the early termination of the NBC CSA, which I'll discuss further shortly. On slide 16, you can see the full bridge of the NAV per share movement in the first quarter. NAV per share was $11.29 as of March 31st, which is flat quarter over quarter. Net unreliable depreciation on investments, credit support agreements, and foreign exchange was $0.07. This is partially offset by net realized losses on the portfolio and FX of $0.01 per share. The net realized loss on the portfolio was predominantly due to the exit of Legal Solutions, NBC's PE Fund, and RONDA, which were offset by the reversal of unreliable depreciation. The valuation of the credit support agreements increased by approximately $4.4 million. The fair value of the Sierra CSA increased from $44.2 million in the fourth quarter to $44.8 million as of March 31st. During the first quarter, the Sierra portfolio had sales and repayments of approximately $21 million and had 20 positions remaining in the portfolio, down from 23 positions as of December 31st. The fair value of the NBC CSA increased from $19.3 million in the fourth quarter to $23 million in the first quarter due to the expected termination in the second quarter. We generated net investment income of $0.25 per share for the quarter compared to $0.28 per share in the prior quarter and $0.28 per share for the first quarter of 2024. Our investment income in the quarter was…

Thank you. We're now conducting a question-and-answer session. [Operator Instructions]. : :

We've reached the end of our question-and-answer session. I'd like to turn the floor back over for any further closing comments.

Thank you, everybody, for joining, and I hope everybody has a great weekend.

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.