COLUMBIA BANK LOAN STRATEGY
AS OF MARCH 31, 2017
Investment Approach
Strategy Details
The team believes strong and consistent risk-adjusted returns in the bank loan market are best achieved through the pro-active management of
credit risk combined with a strategy to seek out relative value opportunities. They believe the most important key to success in bank loan investing is
a mastery of credit skills to determine which companies will have the wherewithal to withstand a credit cycle or other financial events and employ a
proprietary internal rating system to help guide position sizing.
Composite Inception
02/15/2006
Total Bank Loan Assets
$8,440 million
Vehicle Types
Separate Account
Mutual Fund
Trailing Returns (%)
Portfolio Management
Columbia Bank Loan Strategy (gross)
Columbia Bank Loan Strategy (net)
Credit Suisse Leveraged Loan Index
YTD
(cum.)
1-year
3-year
5-year
10-year
Since
inception
1.10
0.94
1.20
9.94
9.24
9.74
4.30
3.66
3.72
5.45
4.83
4.88
4.73
4.14
4.24
5.11
4.52
4.56
Lynn Hopton
31 years experience
Yvonne Stevens
31 years experience
Steven Staver, CPA
24 years experience
Jerry Howard, CFA
22 years experience
Distinguishing Features
Investment Process
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Bottom-up fundamental credit research
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Analysts and portfolio managers partner to identify primary and secondary market opportunities
Research process focuses on identifying the critical credit fundamentals of each issuer
Analyze a companys business prospects, its management, liquidity, capital structure and its competitive standing in the market
Assess collateral quality, loan-to-value coverage and conduct a review of the capital structure and relevant loan documents
Ongoing research and monitoring
■ Review watch list
■ Industry and holdings review
■ Secondary opportunities
■ Primary market pipeline
Portfolio construction/risk management
Client objectives/constraints
■ Issuer and industry diversification
■ Risk rating system
■ Appropriate position sizing
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All values expressed in U.S. Dollars unless otherwise noted.
Past performance does not guarantee future results.
For more information please visit: www.columbiathreadneedle.com
For institutional use only. © 2017 Columbia Management Investment Advisers, LLC. All Rights Reserved.
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Deep and stable investment team of leveraged debt
specialists with an active presence and longevity in the
bank loan market providing a unique combination of
deep resources with boutique focus and flexibility
Extensive commitment to fundamental credit research
by a team with 20-plus years of experience specifically
in the leveraged loan market
The team’s experience, size and presence in the market
have led to top-tier allocations in the primary origination
market as well as strong secondary activity
Independent, proprietary risk and relative value rating
system and constant focus on downside risk
management
A commitment to client-driven, customized investment
solutions and service
COLUMBIA BANK LOAN STRATEGY
AS OF MARCH 31, 2017
Portfolio Characteristics†
5-year Risk Statistics†
Top Issuers†
Portfolio
Index
Number of Issuers
331
1,205
Relative Return
0.57
Number of issues
410
1,497
Tracking Error
0.49
Average credit rating
B1
Split BB
Information Ratio
1.17
98.35
97.51
Alpha
0.47
Beta
1.02
R-Squared
0.96
Standard deviation
2.48
Sharpe ratio
2.15
Index Standard deviation
2.39
Index Sharpe ratio
1.98
Average Price
Portfolio
Aramark Corp
Portfolio Index
1.29
0.36
Royalty Pharma Finance Trust
1.26
0.00
Go Daddy Operating Company, LLC
1.24
0.26
Avolon
1.09
0.57
BWAY Corp
0.90
0.13
Team Health
0.85
0.41
Burger King Corporation
0.73
0.50
Serta/Simmons AOT Bedding
0.71
0.25
American Airlines (AMR)
0.70
0.39
BJ’s Wholesale Club Inc.
0.69
0.19
Portfolio
4.3
Index
0.5
Key Overweights
Key Underweights
Credit Rating (% net assets)†
Manufacturing
Chemicals
Housing
Consumer Non-Durables
Rating
BBB
Forest Products
Food/Tobacco
Transportation
Financial
BB
37.5
38.4
B
Media/Telecom
Aerospace
Energy
Healthcare
Utility
Food and Drug
Consumer Durables
Information Technology
Service
Gaming/Leisure
Retail
Metals/Minerals
48.3
50.3
CCC
5.1
8.7
CC
0.0
0.2
C
0.0
0.1
Cash and Cash Equivalents
1.8
0.0
Not Rated
0.0
1.8
Other
2.9
0.0
†
vs Credit Suisse Leveraged Loan Index (composite)
Source: BlackRock, Columbia Management Investment Advisers, LLC. and S&P. The risk/return characteristics are based on gross of fees performance of the Columbia Bank Loan Composite and are annualized as appropriate. All other information is based on a
representative account in the Columbia Bank Loan Composite. The portfolio holdings information provided by Columbia Management Investment Advisers, LLC and/or its agents or affiliates is proprietary and confidential. References to specific securities are
included as an illustration of the investment management strategy and are not a recommendation to buy or sell. Holdings may represent only a small percentage of the portfolio and are subject to change based on market and other conditions. It should not be
assumed that any particular security was or will prove to be profitable or that decisions in the future will be profitable or provide similar results to the securities discussed.
For institutional use only. © 2017 Columbia Management Investment Advisers, LLC. All Rights Reserved.
COLUMBIA BANK LOAN STRATEGY
AS OF MARCH 31, 2017
Important disclosures for performance and asset information on page 1:
There is no guarantee the objective will be achieved or that any return expectations will be met.
Past performance does not guarantee future results.
Periods over one year are annualized. Portfolios are valued and composite returns are calculated and stated in U.S. dollars. Returns are calculated net of transaction costs and non-reclaimable withholding taxes on dividends, interest, and capital gains, and
reflect the reinvestment of dividends and other earnings. Composite performance is based on the Columbia Bank Loan Strategy composite. Net-of-fees performance returns are calculated by deducting from the gross performance return the highest tier of
the fee schedule in effect for the respective time period. Actual fees may vary depending on, among other things, the applicable fee schedule and portfolio size.
Not all vehicles are available in every jurisdiction and certain vehicles may be offered by affiliates.
Bond ratings are divided into categories ranging from AAA (highest) to D (lowest) and are subject to change. The ratings shown are determined by using the middle rating of Moody’s, S&P and Fitch, each a third-party rating agency, after dropping the
highest and lowest available ratings. When a rating from only two agencies is available, the lower rating is used. When a rating from only one agency is available, that rating is used. When a bond is not rated by one of these agencies, it is designated as
Not Rated. Securities designated as Not Rated do not necessarily indicate low credit quality, and for such securities the investment adviser evaluates the credit quality. Holdings of the portfolio other than bonds are categorized under Other. Credit ratings
are subjective opinions of the credit rating agency and not statements of fact and may become stale or subject to change. For information on the rating methodology of each agency, please go to: www.moodys.com, www.fitchratings.com or
www.standardandpoors.com/home/en/us.
Columbia Management Investments claims compliance with the Global Investment Performance Standards (GIPS®). Columbia Management Investment Advisers, LLC, an SEC-registered investment adviser (formerly known as RiverSource Investments, LLC
prior to May 1, 2010), offers investment products and services to institutional and retail markets. For purposes of compliance with the GIPS standards, Columbia Management Investment Advisers, LLC has defined the Firm as Columbia Management
Investments (prior to May 1, 2010 the Firm was known as RiverSource Institutional Advisers; prior to August 1, 2005 the Firm was known as American Express Asset Management), an operating division of Columbia Management Investment Advisers, LLC
that offers investment management and related services to institutional clients. The Firm was redefined in January 2011 to include stable value assets that were previously excluded from the firm. As of May 1, 2010, certain long- term assets of Columbia
Management Advisers, LLC (“CMA”) were merged into Columbia Management Investments and included in firm assets as of that date. The Firm was redefined in January 2011 to include stable value assets that were previously excluded from the firm.
Beginning March 30, 2015, the Columbia and Threadneedle group of companies, which includes multiple separate and distinct GIPS-compliant firms, began using the global offering brand Columbia Threadneedle Investments.
The firm’s fees are available on request and may also be found in Part 2A of the Columbia Management Investment Advisers, LLC Form ADV. To receive a list of composite descriptions of Columbia Management Investments and/or a presentation that
complies with the GIPS standards, contact Heather Heald at (617) 747-0436, or write to Columbia Management Investments, 225 Franklin Street, 30th floor, Boston, MA 02110, or [email protected].
The strategy consists of discretionary Columbia bank loan portfolios which, under normal market conditions, will invest approximately 60 - 95% in floating rate loans. These leveraged loans or bank loans are typically rated below investment grade. The
strategy may also invest up to 20% in foreign investments.
The Credit Suisse Leveraged Loan Index is an unmanaged market value-weighted index designed to represent the investable universe of the U.S. dollar-denominated leveraged loan market. The index reflects reinvestment of all distributions and changes
in market prices. It is not possible to invest directly in an index.
There is no guarantee that the investment objectives will be achieved or that return expectations will be met. Care should be used when comparing these results to those published by other investment advisers, other investment vehicles, and unmanaged
indices due to possible differences in calculation methods. Registration with the SEC as an investment adviser does not imply a certain level of skill or training.
Columbia Threadneedle Investments is the global brand name of the Columbia and Threadneedle group of companies.
For institutional use only. © 2017 Columbia Management Investment Advisers, LLC. All Rights Reserved.