Fixed Income
CIO WEEKLY PERSPECTIVES
New Year, New Monetary Policy
As markets adjust for an environment of tighter monetary conditions, we preview the key themes of our forthcoming Fixed Income Investment Outlook.
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Fixed Income
Fixed Income Investment Outlook 1Q 2022
Persistent Inflation, Policy-Driven Volatility
The evolution of inflation and central bank policy will likely drive higher market volatility in 2022.
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Fixed Income
NB Blog
Non-Qualified Mortgage Securities: Idiosyncrasies and Opportunities
As Non-QM structures change, opportunities grow for AAA investors.
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Fixed Income
PLATFORM OVERVIEW
The comprehensive and global nature of our platform and investment process enables our team to offer a variety of focused and multi-sector solutions to meet unique investor needs.
INVESTMENT GRADE
NON-INVESTMENT GRADE
EMERGING MARKETS
MUNICIPALS
MULTI-SECTOR
PRIVATE CREDIT
OUR PHILOSOPHY
Bond markets often fail to price in complexity and cross-currents. We believe a value-oriented approach based on process-led investing, a commitment to research and an integrated global approach can capitalize on these market inefficiencies
Process-Led Investing
Our process combines macro inputs, relative value analysis and fundamental research to drive informed decision-making and consistent investment performance
Commitment to Research
Fundamental research that integrates ESG considerations allows for a differentiated understanding of potential value and, more importantly, the risk of loss
Integrated Global Platform
Continuous collaboration is at the center of our effort as it allows for the best of investment insights globally to be reflected in portfolios
OUR PLATFORM
$205bn
of assets under management across an integrated global platform comprised of 182 investment professionals, including 74 research analysts
INVESTMENT GRADE
NON-INVESTMENT GRADE
EMERGING MARKETS
MUNICIPALS
MULTI-SECTOR
PRIVATE CREDIT
40 YEARS OF MANAGING FIXED INCOME ASSETS
ESG, SUSTAINABLE & IMPACT1
Material environmental, social and governance factors are an important driver of long-term investment returns from both an opportunity and a risk-mitigation perspective
ESG-Integrated
100% Fixed Income AUM evaluates ESG factors in fundamental credit research process
Proprietary Views
1,100+ Systematically developed NB ESG Quotient™ ratings for credit issuers based on financially material factors
Customized ESG Solutions
Innovative implementation to address a range of ESG goals, including net zero in multi-sector credit
ACTIVE ENGAGEMENT2
We believe close engagement with management on ESG issues is an integral part of managing risk in our role as direct providers of new capital
1,400+
engagements with fixed income issuers
38%
on environmental issues
52%
on social issues
73%
on governance issues
Thoughts from our fixed income investment professionals on the evolving state of global markets and the macro economy
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INSIGHTS
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Seagoing Shipping Rates and Port Activity
Shipping costs have exploded due to a complex list of factors that are unlikely to subside quickly.
Non-Qualified Mortgage Securities: Idiosyncrasies and Opportunities
As Non-QM structures change, opportunities grow for AAA investors.
Europe Telecoms: PE Deal Talk Reaches a Crescendo
Competition and capital needs have dampened European public telecom valuations, which could continue to elevate private equity activity in the space this year.
Municipal VRDOs: Price Stability and Attractive Yields
Municipal variable rate demand obligations (VRDOs) remain an appealing, high-quality cash management tool for institutional portfolios in a yield-starved environment.
ESG and U.S. Hydrocarbon Production
ESG may be impacting U.S. hydrocarbon production, but through improved corporate governance rather than environmental pressures.
Esoteric ABS: A Relative Value Opportunity
With its growing availability and attractive spreads, the esoteric ABS market is creating new opportunities to enhance portfolios.
Continued U.S. Shale Growth in 2022
U.S. shale growth is expected to continue in 2022 but will likely be moderated by continued capital markets focus on disciplined capital allocation by producers.
The Consumer Shows Strength
Consumer balance sheets remain healthy in the United States and Europe.
December Employment Report Should Confirm Fed Hawkishness
Tightness will likely temper expectations for big jobs gains in 2022.
OPEC+ Stays the Course
OPEC and its partners stick to their plan to increase production despite the risk of an oversupplied market.
Treasury Rates Higher to Start the Year
The U.S. Treasury market began 2022 with higher and more volatile rates, a trend that we expect to continue for the remainder of the quarter.
Interest-Bearing Education
The pandemic created an opportunity for European students to advance their skillsets in a lockdown environment, benefitting credits in the private education sector.
Taxable Municipal Supply Has Staying Power: 2022 Outlook
We expect the taxable municipal market to remain a key financing vehicle for U.S. municipal issuers in 2022 and beyond.
Japan’s Search for Surplus Yield
Upcoming rate hikes could drive an increase in hedging costs for Japanese investors, redirecting flows into unconventional assets and regions.
The IPO Boom Isn’t Just About the Equity Market
A healthy IPO market has provided a timely windfall for many non-investment grade issuers looking to deleverage after a challenging 2020.
Inflation’s Impact on IG Credit
Investment grade credit fundamentals remain healthy, but supply chain issues are contributing to the overarching inflationary environment, with different impacts across sectors.
The Future State of Real Estate Investing
(17:33) Real estate, both in the public and private markets, can act as a diversifier during times of uncertainty. But what are the other factors to consider within this asset class?
Peak Housing? The Residential Real Estate Outlook for 2022
Strong demand for U.S. housing has been a key contributor to mortgage credit outperformance since early in the pandemic. Can housing markets continue to shine in 2022?
European ABS in the Year of Tapering
Notwithstanding valuations, we anticipate opportunities in various areas of the European asset-backed securities market in 2022.
The BoE Watches Energy and Labor
We believe the U.K.’s energy-driven inflation should prove largely transitory, but that healthy growth could produce more lasting pricing pressures.
Is the Japanese Yen Finally Cheap?
Over the past year, short-term drivers of the Japanese yen have pushed the currency to be undervalued when measured across valuation models.
Corporate Credit ESG Engagements
Fixed Income investors continue to play a pivotal role in environmental, social and governance engagement efforts.
Attractiveness of Emerging Markets Credit Is Country-Specific
Emerging markets credit has sharply underperformed U.S. credit this year—is there value or is this a value trap?
Central Banks Drive Yield Curves Flatter
Front-loaded expectations for central bank interest rate hikes continue to drive sovereign yield curves toward record levels of flatness.
Is the Green Bond Premium Here to Stay?
We believe that the green bond premium—already significant in some fixed income markets—is set to expand further, driven by increasing investor interest and a supportive regulatory environment.
Danish Covered Bonds: We See Callables as an Attractive Carry Opportunity
Recent underperformance of Danish callable bonds versus government bonds and swaps gives these fixed-rate bonds a favorable carry return profile relative to much of the AAA bond universe.
The Open Road Leads to the Used-Car Lot
Your car is worth more than you think—record-high car prices remain elevated due to shortfalls in new car volumes from OEM’s.
U.K. Private Equity Deal Drive Delivers Record Issuance
An acceleration of PE deals is contributing to record leveraged credit issuance in Europe, offering investors a potentially attractive opportunity to overweight U.K. assets.
Chile: Three Strikes and Still Not Out
Eventual clarity on its constitution and election should help Chilean assets.
Tapering Impact on Treasury Supply
Net Treasury supply is set to fall in 2022, even as the Fed exits bond buying.
Incomes Are Likely to Support Growth and Consumption
Fears about consumption may be misplaced.
Oil’s Disparate Impact in Emerging Markets Credit
Oil prices are expected to remain elevated in coming quarters, with higher prices having differentiated effects across emerging markets credit.
Euro and Sterling Corporate Issuance in 2021
Despite strong market conditions, record-low yields and robust demand for credit, supply has underwhelmed in 2021 as issuers have remained disciplined in raising liquidity.
European Real Estate: The Coming Reveal
Only when the tide goes out do you discover who's been swimming naked.
Central Banks Emerge From Hibernation
Rates volatility reflects a change in the inflation narrative, and could accelerate central bank policy adjustments.
SDRs: A Lifeline for a Tough Winter
SDR issuance came at the right time to help emerging market financing, as the asset class comes under pressure amid rising global inflation and China noise.
Bring On the Transition
A period of changing policy could bring new opportunities to add to yields in the municipal market.
The Peruvian President Chooses Moderation
Severing ties with the far left will cost Castillo some political capital but could also allow him to advance the more pragmatic aspects of his agenda.
Watch Out for Food Inflation
While other CPI components may be discretionary, “food at home” is accelerating.
Sustainability in Emerging Markets Debt
Ignoring sustainability in emerging markets debt is, for want of a better term, no longer sustainable.
El Salvador and Bitcoin
Establishing the cryptocurrency as legal tender is a risky move, but also carries some potential benefits.
Public/Private Investing: Fixed Income at a Crossroads
Drawing on multiple fixed income asset classes can help investors navigate varied market environments.
CAT Bonds: Finding Reassurance in Reinsurance
(20:12) With flooding, wildfires and hurricanes continuing to wreak havoc around the globe, how might investors want to consider these natural catastrophe risks within their portfolios?
Evergrande Heads for Default
We believe systematic risk beyond the Chinese property market remains limited.
ECB Policy and Bunds Are Set to Move
Ahead of the key European Central Bank policy meeting on September 9, we offer our views on what will likely change, what may not, and what it could mean for the Bund yield.
EM Corporate High Yield 2021 Default Outlook – Midyear Review
We expect a marginal uptick in defaults from our original estimates, given rising China corporate default risk offset by an improving outlook for much of the emerging markets.
Private Debt, Capital Solutions and the Early-Cycle/Later-Cycle Paradox
Early-cycle growth prospects should incentivize investment, but later-cycle valuations can give pause: Private debt and capital solutions could resolve the paradox.
Developing a Roadmap for ESG Performance
Neuberger Berman’s Engagement Series presents insights and case studies on our dialogue with companies, government entities and other securities issuers.
Bond Yields Under a More Hawkish Fed
A more hawkish Fed may not lift Treasury or investment grade credit yields, and that raises important questions for fixed income investors and asset allocators.
Opportunities for Enhanced Yields in Special Situations and Private Debt
The aftermath of the COVID-19 pandemic continues to create unique opportunities for enhanced returns for investors focused on idiosyncratic, special situation investments.
Are Central Banks Risking Their Independence?
Monetary policy institutions may be straining their credibility, which increases the likelihood of political encroachment and threatens our hard-earned victory over volatile consumer prices.
Non-IG News: An Update on the Cruise Industry
(6:41) In this video, our Senior Research Analyst, Adam Howaniec, provides an update on the Non-Investment Grade Cruise Industry.
Public vs. Private Credit: Competitors or Allies?
(19:50) Over the course of more than a decade, private debt has been in high investor demand. But how does private debt come into play alongside public fixed income markets?
The State of BBBs: Here to Stay
A significant, if misunderstood, market segment continues to offer attractive investment opportunity.
A Crack in China’s Debt Foundations
Bonds issued by China’s biggest distressed debt asset manager just lost 40% of their value—how concerned should we be?
Senior Floating Rate Loans: Opportunity as Rates Rise
Where to find yield without duration when inflation expectations and nominal long rates are on the rise.
Non-IG News: Leisure & Entertainment Sector Update
(3:27) Non-IG Leisure and Entertainment Sectors Update
Early-Cycle Conditions Still Support Credit
Why the run-up in rates has troubled equity markets more than credit, and why we think that is poised to continue.
Time to Get Strategic: Emerging Markets Debt as a Core Insurance Portfolio Allocation
We believe emerging markets debt warrants a strategic allocation by insurance companies—but while our own conversations indicate change is coming, holdings analysis suggests insurers are not yet taking advantage of the opportunity.
Toward a Steeper U.S. Yield Curve
A potentially substantial growth and inflation recovery from the second half of this year could put pressure under long-dated yields, and eventually the Fed.
Rates Markets Are Normalizing
It is far too early for taper talk, in our view, but the bias of risk is still toward higher rates to come.
Non-IG News: Earnings Trends in Non-IG Credit
(3:47) During the early stages of the pandemic, most market participants and company managements were very concerned about the impact from mandated shutdowns and shelter-in-place orders on company revenues and bottom line results.
Market Conditions and Opportunities in Private Credit
(4:48) Matthew Bird, Managing Director for our Private Debt team, provides an update on how the Private Debt markets are managing through the COVID-19 crisis, how the team has been managing portfolios since March, and what investors could anticipate in the months ahead.
Perspective on Private Credit
(4:22) Listen to David Lyon as he discusses the current dislocation in the credit markets and the types of investment opportunities that may emerge as a result.
ESG Fixed Income Engagement Report
Our engagement process, key themes and observations, data summarizing our engagement activities and relevant case studies.
Emerging Markets Debt: A Soft Patch for Hard Currency
This year’s sell-off opens an opportunity to make strategic allocations at attractive valuations.
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