Core Viewpoint - Palmer Square Capital Management has launched two new exchange traded funds (ETFs), the Palmer Square Credit Opportunities ETF (PSQO) and the Palmer Square CLO Senior Debt ETF (PSQA), aimed at providing innovative investment solutions in the credit market [1][2]. Group 1: ETF Details - The Palmer Square Credit Opportunities ETF (PSQO) is an actively managed multi-asset credit strategy that simplifies portfolio construction and enhances access to relative value opportunities across various credit types, including CLOs, investment grade and high yield corporate bonds, ABS, and bank loans [2][3]. - The Palmer Square CLO Senior Debt ETF (PSQA) offers passive access to the CLO market through a proprietary CLO Senior Debt Index (CLOSE), allowing investors to leverage Palmer Square's expertise in the senior tranches of the CLO market [2][3]. Group 2: Company Background - Palmer Square Capital Management, founded in 2009, manages over $32 billion in assets and focuses on opportunistic credit, income strategies, private credit, and CLOs, serving a diverse client base including institutional investors and high net worth individuals [4]. - The firm has established itself as a top issuer in the global CLO market and created the first public Senior and Debt CLO benchmarks in 2015, demonstrating its deep understanding of market complexities [2][4]. Group 3: Market Position and Strategy - The investment philosophy of Palmer Square is consistent across multiple credit cycles, emphasizing the identification of relative value and credit selection through detailed fundamental credit analysis [3]. - The new ETFs are set to begin trading on September 12, 2024, with Palmer Square participating in the opening bell ceremony at the New York Stock Exchange [3].

Financial Data and Key Metrics Changes - Total investment income for Q2 2024 was $36.5 million, a 33% increase from $27.4 million in the prior year [24] - Net investment income for Q2 2024 was $15.8 million or $0.48 per share, compared to $14.2 million or $0.56 per share for the same period last year [24] - NAV per share decreased to $16.85 from $17.16 at the end of Q1 2024 [25] Business Line Data and Key Metrics Changes - The total investment portfolio as of June 30, 2024, had a fair value of approximately $1.43 billion, reflecting a sequential growth of approximately 3% from $1.39 billion at the end of Q1 2024 [16] - The company deployed $189 million of capital in Q2 2024, including 24 new investment commitments [16] - The portfolio is 96% Senior Secured with an average hold size of approximately $6 million [19] Market Data and Key Metrics Changes - Bank loans returned 1.7% during Q2 2024, bringing the year-to-date return to 4.1% [11] - PSBD returned approximately 7.5% year-to-date through July 2024 [11] - The CLO market had a record year with $243 billion issued in the U.S. and $41 billion in Europe as of July 31, 2024 [8] Company Strategy and Development Direction - The company focuses on an opportunistic credit investment strategy, allowing it to invest across liquid and private markets [7] - The strategy emphasizes maintaining exceptional credit quality while seeking to capitalize on market opportunities [6] - The company aims to maintain strong credit quality and avoid adding meaningful risk in the current market environment [14] Management's Comments on Operating Environment and Future Outlook - The U.S. economy has shown signs of modest slowing, with the labor market beginning to show fatigue [10] - Management remains cautiously optimistic about the potential for new borrowers entering the market in the second half of the year [31] - The company is focused on maintaining discipline in investment decisions amid a borrower-friendly environment [13] Other Important Information - The company repurchased 21,352 shares at an average price of $16.22 during Q2 2024 [26] - The Board of Directors declared a third quarter 2024 base dividend of $0.42 per share [26] - PIK income as a percentage of overall net investment income remains low at approximately 0.5% [22] Q&A Session Summary Question: Can you elaborate on the thought process behind the investments sold within the portfolio? - The majority of sales were due to refinancing and spread tightening, where some loans did not meet the required yield [29] Question: What are the latest thoughts on the attractiveness of primary versus secondary loan markets? - The majority of new investments were refinancing transactions, with cautious optimism for new borrowers in the latter half of the year [31] Question: How are covenant and collateral packages trending in recent transactions? - There has been more lender-friendly terms recently, but it is too early to determine the long-term impact [34] Question: Can you clarify the realized gains and unrealized gains in the portfolio this quarter? - Some loans were marked above par due to strong performance, and when repaid at par, it led to a reversal of unrealized gains [37]

Investment Income - Total investment income for Q2 2024 was $36.5 million, up from $27.4 million in Q2 2023, representing a 33.3% increase[2] - Investment income from non-controlled, non-affiliated investments for Q2 2024 was $36,549,496, a 33% increase compared to $27,441,864 in Q2 2023[20] - Net investment income for Q2 2024 was $15.8 million or $0.48 per share, compared to $14.2 million or $0.56 per share in the same period last year, reflecting a decrease of 2.8% in per share income[2] - Net investment income for Q2 2024 was $15,757,851, compared to $14,200,119 in Q2 2023, reflecting an increase of approximately 11%[20] Portfolio and Investments - The portfolio consisted of 256 investments in 209 companies with a total fair value of approximately $1.4 billion, with 85.7% in first lien senior secured debt[4] - New investments totaled $189,301,404 in Q2 2024, significantly higher than $46,672,859 in Q2 2023, marking an increase of over 304%[23] - The number of new investment commitments increased to 24 in 2024 from 13 in 2023, indicating a growth in investment activity[24] - The company had $30.0 million in unfunded commitments to provide debt financing to portfolio companies as of June 30, 2024, up from $20.1 million at December 31, 2023[18] - The weighted average interest rate of new investment commitments was 9.96% in Q2 2024, slightly down from 10.15% in Q2 2023[24] Financial Position - As of June 30, 2024, total assets were $1.5 billion, with total net assets of $549 million[2] - Total assets increased to $1,458,741,190 as of June 30, 2024, up from $1,121,814,718 at December 31, 2023, representing a growth of approximately 30%[16] - The debt-to-equity ratio increased to 1.49x as of June 30, 2024, compared to 1.42x as of March 31, 2024[2] - The company had $14.8 million in cash and cash equivalents and approximately $820.4 million in total debt outstanding as of June 30, 2024[6] - Total liabilities rose to $909,950,959 from $659,859,325, indicating an increase of about 38%[17] Dividends and Expenses - The company declared a third quarter regular base dividend of $0.42 per share, payable on October 14, 2024[9] - Total expenses for Q2 2024 were $20,791,645, compared to $13,497,497 in Q2 2023, representing an increase of approximately 54%[20]

Investment Portfolio - As of June 30, 2024, the company had 256 debt and equity investments in 209 portfolio companies with an aggregate fair value of approximately $1.4 billion, up from 227 investments valued at $1.0 billion as of December 31, 2023[169] - The investment portfolio at fair value increased from $1.0 billion as of December 31, 2023, to $1.4 billion as of June 30, 2024[184] - The company’s investment objective is to maximize total return, which includes current income and capital appreciation, focusing on corporate debt securities and CLO structured credit funds[164] - The company’s investment strategy includes a focus on "Covenant-Lite Loans," which have fewer or no maintenance covenants compared to traditional loans[164] Investment Activity - For the three months ended June 30, 2024, the company made new investments totaling $189.3 million, significantly higher than $46.7 million for the same period in 2023[171] - As of June 30, 2024, the company’s total new investments for the six months amounted to $326.2 million, a significant increase from a net outflow of $25.8 million in the same period of 2023[171] - The principal amount of investments sold or repaid for the three months ended June 30, 2024, was $140.0 million, compared to $33.8 million for the same period in 2023[171] Financial Performance - Total investment income for the three months ended June 30, 2024, was $36,549,496, compared to $27,441,864 for the same period in 2023, representing a 33% increase[181] - Net investment income for the six months ended June 30, 2024, was $32,076,080, up from $27,792,799 in the same period of 2023, reflecting a 15% increase[181] - Net realized losses on investments for the three months ended June 30, 2024, were $(9,411,924), compared to $(2,570) in the same period of 2023[181] Debt and Financing - The company had $386.6 million principal outstanding under the BoA Credit Facility as of June 30, 2024, down from $490.0 million in the previous year[195][202] - The company entered into a share repurchase plan to acquire up to $15 million in shares if the market price is below the most recently reported NAV per share[197] - On May 23, 2024, the company completed a $400.5 million term debt securitization (CLO Transaction) to finance a portion of its portfolio investments[213] - The outstanding indebtedness under the CLO Transaction was $300 million as of June 30, 2024[215] Cash and Liquidity - Cash and cash equivalents increased to $14.8 million as of June 30, 2024, up from $6.7 million as of June 30, 2023[195] - During the six months ended June 30, 2024, the company experienced a net increase in cash and cash equivalents of $12.7 million, primarily due to financing activities[192] Dividends and Shareholder Returns - The company intends to distribute quarterly dividends to stockholders, aiming to distribute at least 90% of its net ordinary income and net short-term capital gains to maintain RIC tax treatment[216] - The company has adopted a dividend reinvestment plan allowing stockholders to reinvest dividends in additional shares of common stock unless they opt for cash[219] Risk Management - The company is subject to financial market risks, including changes in interest rates, which can materially affect net investment income[235] - The company may hedge against interest rate and currency exchange rate fluctuations using standard hedging instruments, subject to regulatory requirements[240] Management and Advisory - The company is externally managed by an Investment Advisor registered with the SEC, which oversees day-to-day operations and investment management[163] - The base management fee under the Advisory Agreement is set at an annual rate of 1.75% of the average value of total net assets[231] Market Conditions - The weighted average total yield to maturity of debt and income producing securities at fair value was 9.82% as of June 30, 2024, compared to 10.51% as of December 31, 2023[169] - The weighted average interest rate of new investment commitments was 9.96% for the three months ended June 30, 2024, down from 10.15% in the same period of 2023[173] - The percentage of new debt investment commitments at floating rates was 97.01% for the three months ended June 30, 2024, compared to 100.00% in the same period of 2023[173] Commitments and Obligations - The company has twenty-two unfunded commitments totaling $30.0 million as of June 30, 2024, indicating potential future cash requirements[233] - As of June 30, 2024, total contractual obligations amount to $820,390,080, with $383,148,268 due under the BoA Credit Facility and $136,717,785 under the WF Credit Facility[232]

Palmer Square Capital BDC Inc. (NYSE:PSBD) Q1 2024 Earnings Conference Call May 7, 2024 12:00 PM ET Company Participants Andrew Wedderburn-Maxwell - Investor Relations Chris Long - Chairman and Chief Executive Officer Angie Long - Chief Investment Officer Matt Bloomfield - President Jeff Fox - Chief Financial Officer and Director Conference Call Participants Melissa Wedel - JPMorgan Kenneth Lee - Capital Markets Vilas Abraham - UBS Operator Welcome to Palmer Square Capital BDC’s First Quarter 2024 Earnings ...

Palmer Square Capital BDC Inc. Announces First Quarter 2024 Financial Results and Declares Second Quarter 2024 Base Dividend Distribution of $0.42 Per Share MISSION WOODS, Kansas, May 7, 2024 — Palmer Square Capital BDC Inc. (NYSE: PSBD) ("PSBD" or the "Company"), an externally managed business development company, today announced its financial results for the first quarter ended March 31, 2024. Financial and Operating Highlights Exhibit 99.1 "Palmer Square Capital BDC generated strong first quarter results ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2024 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 000-56126 Securities registered pursuant to Section 12(b) of the Act: | | | Name of each exchange on which | | --- | --- | --- | | Title of each class | Trading Symbol(s) | regist ...

Palmer Square Capital BDC Inc. (NYSE:PSBD) Q4 2023 Earnings Conference Call February 28, 2024 11:00 AM ET Company Participants Andrew Wedderburn-Maxwell - Investor Relations Chris Long - Chairman & Chief Executive Officer Angie Long - Chief Investment Officer Matt Bloomfield - President Jeff Fox - Chief Financial Officer & Director Conference Call Participants Kenneth Lee - RBC Capital Markets Melissa Wedel - JPMorgan Operator Welcome to the Palmer Square Capital BDC's Fourth Quarter and Year-End 2023 Earni ...

UARE | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |-------|-------|-------|-------------------------------|-------|--------------------------------|-------|-------|-------|---------------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Palmer Square Capital BDC Inc. | | | | | | | | | | | ...

Investment Portfolio - As of December 31, 2023, the company had 227 debt and equity investments in 191 portfolio companies with an aggregate fair value of approximately $1.0 billion[382]. - As of December 31, 2023, total investments amounted to $1.16 billion, with first-lien senior secured debt representing the largest portion at approximately $952.10 million fair value[387]. - The investment portfolio at fair value increased to $1.0 billion as of December 31, 2023, from $966.9 million in 2022[394]. - The company has designated its Investment Advisor as the valuation designee for determining fair value of portfolio investments effective August 11, 2022[435]. - The company measures realized gains or losses based on the difference between net proceeds from sales and the amortized cost basis of investments[439]. Financial Performance - Total investment income for the year ended December 31, 2023, was $112.2 million, an increase of 50.7% from $74.5 million in 2022[391]. - Net investment income for 2023 was $58.0 million, up 41.1% from $41.1 million in 2022[391]. - The weighted average total yield to maturity of debt and income-producing securities at fair value was 10.51% as of December 31, 2023, compared to 11.47% as of December 31, 2022[380][382]. - The weighted average total yield of debt and income-producing securities decreased to 10.51% in 2023 from 11.47% in 2022[390]. - Net expenses for 2023 were $54.2 million, a significant increase from $33.4 million in 2022, primarily due to higher interest expenses[395]. - Interest expense for 2023 was $44.5 million, up from $23.5 million in 2022, reflecting increased average interest rates[396]. Investment Activity - For the year ended December 31, 2023, the company made new investments totaling $273.73 million, while sold investments amounted to $247.08 million, resulting in total new investments of $26.65 million[384]. - The average new investment commitment amount for the year ended December 31, 2023, was $3.80 million, with 67 new investment commitments made[386]. - The weighted average interest rate of new investment commitments was 10.22% for the year ended December 31, 2023[386]. - The percentage of new debt investment commitments at floating rates was 98.82% for the year ended December 31, 2023[386]. Cash and Liquidity - Cash provided by operating activities in 2023 was $19.5 million, with proceeds from the sale of investments totaling $247.1 million[403]. - The company held $63.8 million in fair value of short-term money market funds at the end of 2023[403]. - Average net assets increased from $416.4 million in 2022 to $420.4 million in 2023[396]. - As of December 31, 2023, the company had cash and cash equivalents of $2.1 million, an increase from $1.7 million as of December 31, 2022[407]. - The company maintains sufficient liquidity to fund unfunded commitments, supported by cash and borrowing capacity[443]. Debt and Credit Facilities - The principal outstanding under the BoA Credit Facility was $504.0 million as of December 31, 2023, down from $514.5 million in 2022[407]. - The company had approximately $221.0 million of available commitments under the BoA Credit Facility as of December 31, 2023[416]. - The WF Credit Facility was amended on December 18, 2023, increasing the borrowing amount from $150 million to $175 million and extending the maturity date to December 18, 2028[418]. - As of December 31, 2023, the principal outstanding under the WF Credit Facility was approximately $136.3 million[422]. - The asset coverage ratio was 172% as of December 31, 2023, exceeding the required minimum of 150%[409]. Dividends and Distributions - The company intends to distribute quarterly dividends to stockholders, contingent on available income[423]. - The company must distribute at least 90% of its net ordinary income and net short-term capital gains to maintain RIC tax treatment[424]. - The company intends to distribute net capital gains at least annually, but may retain them for investment, incurring corporate-level tax on such gains[427]. - A dividend reinvestment plan has been adopted, allowing stockholders to reinvest dividends into additional shares unless they opt for cash[428]. Commitments and Obligations - The company has significant contractual obligations totaling $641,828,805, with $505,417,357 due within one year and $136,411,448 due in 1-3 years[442]. - As of December 31, 2023, the company had fifteen unfunded commitments totaling $20.1 million, indicating potential future cash requirements[443]. Risk Management - The company is subject to interest rate sensitivity, with a potential increase in net investment income of $4,425,817 if interest rates rise by 100 basis points[447]. - The company may hedge against interest rate and currency exchange rate fluctuations using standard hedging instruments, subject to the requirements of the 1940 Act[449]. - The company has entered into related party transactions with its Investment Advisor, which is majority-owned by PSCM[440].