Neuberger Berman Strategic Income Fund, Built For Evolving Fixed Income Markets, Passes $2 Billion In Assets

Media Contact:

Alex Samuelson, 212.476.5392, Alexander.Samuelson@nb.com

New York, March 31, 2015 — Neuberger Berman, one of the world’s leading private, employee-owned investment managers, is pleased to announce that its Strategic Income Fund (tickers: NSTLX, NSTAX, NSTCX, NRSIX, NSTTX) (the “Fund”) has exceeded $2 billion in assets following investor inflows and market appreciation.

NSTLX, the Fund’s institutional and oldest share class, has generated positive annual returns over the past 10 years ended December 31, 2014, while outperforming the Morningstar multi-sector bond category average through a variety of challenging market episodes during this period – rising and falling interest rates, the Great Recession, high market volatility, as well as Fed tapering. According to fund tracker Morningstar Inc., the performance of the Fund’s NSTLX share class, rated 4 stars overall as of February 28, 2015, ranks in the top quartile for the 10-year period ended February 28, 2015. These results have been achieved with less volatility as measured by standard deviation than funds in the Multisector bond category.

The Fund, managed by a portfolio management team averaging 27 years of investment experience, is led by Andrew Johnson, the firm’s head of global investment grade fixed income. The Fund’s managers invest across the global fixed income spectrum, including investment grade and non-investment grade bonds issued in the U.S. as well as in other developed and emerging market countries.

“Neuberger Berman Strategic Income is designed to meet the challenges of today’s investors, providing a Fund that seeks to address sensitivity to interest rates, evolving central bank policies, and other unexpected vulnerabilities by investing in an expanded fixed income universe and with heightened attention to risk management,” Johnson said. “We’re gratified by investor reception to our Fund’s defined, rigorous and repeatable investment process and performance to date.”

The Fund’s assets have grown to $2 billion from $8 million in 2008.

About Neuberger Berman

Neuberger Berman, founded in 1939, is a private, independent, employee-owned investment manager. The firm manages equities, fixed income, private equity and hedge fund portfolios for institutions and advisors worldwide. With offices in 18 countries, Neuberger Berman’s team is more than 2,100 professionals and the company was named by Pensions & Investments as a 2013 and 2014 Best Place to Work in Money Management. Tenured, stable and long-term in focus, the firm fosters an investment culture of fundamental research and independent thinking. It manages $250 billion in client assets as of December 31, 2014. For more information, please visit our website at www.nb.com.

An investor should consider Neuberger Berman Strategic Income Fund’s investment objectives, risks and fees and expenses carefully before investing. This and other important information can be found in the Fund’s prospectus and, if available, summary prospectus, which you can obtain by calling 877.628.2583. Please read the prospectus and, if available, the summary prospectus, carefully before making an investment. Investments could result in loss of principal.

Performance discussed herein is past performance, which is no guarantee of future results.

Shares in the Fund may fluctuate based on interest rates, market condition, credit quality and other factors. In a rising interest rate environment, the value of an income fund is likely to fall. Lower rated debt securities (also known as “junk bonds”) involve greater risks and may fluctuate more widely in price and yield, and carry a greater risk of default, than investment grade debt securities. They may fall in price during times when the economy is weak or is expected to become weak. Foreign securities involve risks in addition to those associated with comparable U.S. securities, including exposure to less developed or less efficient trading markets; social, political or economic instability; fluctuations in foreign currencies; nationalization or expropriation of assets; settlement, custodial or other operational risks; and less stringent auditing and legal standards. These risks may be more pronounced for emerging market securities, which involve additional risks and may be more volatile and less liquid than foreign securities tied to more developed economies. The Fund’s performance could be affected if borrowers pay back principal on certain debt securities, such as mortgage- or asset-backed securities, before or after the market anticipates such payments, shortening or lengthening their duration. When-issued/delayed-delivery securities can have a leverage like effect on the Fund, which may increase fluctuations in the Fund’s share price and may cause the Fund to liquidate positions when it may not be advantageous to do so to satisfy its purchase obligations. The Fund may also invest in senior loans and other debt securities, which also may be rated below investment grade. No active trading market may exist for many loans, loans may be difficult to value and many are subject to restrictions on resale, which may result in extended trade settlement periods and may also prevent the Fund from obtaining the full value of a loan when sold. Loans and other debt securities are also subject to interest rate risk and floating-rate loans may be more susceptible to adverse economic and business conditions and other developments affecting the issuers of such loans, which could reduce demand for such loans.

The Fund normally executes an above-average amount of fixed-income trading and has a high portfolio turnover rate, which may increase the Fund’s transaction costs and may adversely affect the Fund’s performance.

The Fund may invest in Underlying Funds, including funds in the Neuberger Berman fund family, and a portion of the Fund’s investment performance will be directly related to the investment performance, risks and expenses of such Underlying Funds, which could result in the duplication of certain fees, including management and administration fees.

The Morningstar ratings for the Fund are as follows: Neuberger Berman Strategic Income Fund – Institutional Class received a 4 star overall rating as of 2/28/15, 3 stars for the 5- year period and 5 stars for the 10-year period ended 2/28/15. Class A received a 2 star overall rating as of 2/28/15, 2 stars for the 5- year period and 4 stars for the 10-year period ended 2/28/15. Class C received a 3 star overall rating as of 2/28/15, 3 stars for the 5- year period and 4 stars for the 10-year period ended 2/28/15. The Morningstar multisector bond fund category contained 206 funds for overall period, 166 funds for the 5-year period and 98 funds for the 10-year period ended 1/31/15.

For each retail mutual fund with at least a three-year history, Morningstar calculates a Morningstar Rating based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a fund’s monthly performance (including the effects of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% of funds in each category receive five stars, the next 22.5% receive four stars, the next 35% receive three stars, the next 22.5% receive two stars and the bottom 10% receive one star. (Each share class is counted as a fraction of one fund within this scale and rated separately, which may cause slight variations in the distribution percentages.) The Overall Morningstar Rating for a retail mutual fund is derived from a weighted average of the performance figures associated with its three-, five- and ten-year (if applicable) Morningstar Rating metrics. Ratings are ©2015 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.

Morningstar rankings are based on Morningstar total returns, which include both income and capital gains or losses and are not adjusted for sales charges or redemption fees, for all funds that have the same Morningstar category. The highest percentile rank is 1 and the lowest is 100. Neuberger Berman Strategic Income Fund - Institutional Class was ranked in the 17th percentile for the 1-year period, 35th percentile for the 5-year period and 14th percentile for the 10-year period all ended 2/27/15. Class A was ranked in the 24th percentile for the 1-year period, 50th percentile for the 5-year period and 18th percentile for the 10-year period all ended 2/27/15. Class C was ranked in the 37th percentile for the 1-year period, 75th percentile for the 5-year period and 38th percentile for the 10-year period all ended 2/27/15. The Morningstar multisector bond category contains 276, 196 and 137 for the 1-, 5- and 10-year periods ended 2/27/15, respectively.

Standard Deviation is a statistical measure of the historical volatility of a mutual fund or portfolio. The following chart shows the standard deviation for the Fund’s A, C and I share classes as compared to the Morningstar multisector bond category, respectively, for the periods shown:

(as of 12/31/14) 1 Year 3 Years 5 Years 10 Years
Neuberger Berman Strategic Income I 2.62 3.30 3.84 4.68
Neuberger Berman Strategic Income A 2.63 3.29 3.87 4.67
Neuberger Berman Strategic Income C 2.64 3.30 3.85 4.66
US OE Multisector Bond 3.33 3.91 4.75 6.69

 

          Expenses*
Average Annualized Total Returns (%) as of 12/31/14* 1 Year 3 Years 5 Years 10 Years Gross Expense Total (Net) Expense
Institutional Class (NSTLX) 4.45 5.65 6.70 7.16 0.89 0.79
Class A at NAV (NSTAX) 4.04 5.23 6.29 6.87 1.29 1.19
Class C at NAV 3.31 4.50 5.53 6.33 2.02 1.89
Class A w/ sales charge (NSTAX) -0.35 3.72 5.38 6.40    
Class C w/ sales charge (NSTCX) 2.31 4.50 5.53 6.33    
Barclays U.S. Aggregate Bond Index 5.97 2.66 4.45 4.71    
             

Performance data quoted represent past performance, which is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Results are shown on a “total return” basis and include reinvestment of all dividends and capital gain distributions. Current performance may be lower or higher than the performance data quoted. For performance data for all Fund share classes current to the most recent month-end, please visit www.nb.com/performance.

The inception dates for the Strategic Income Fund Institutional Class is 7/11/03. The inception date for the Class A and Class C shares is 12/20/07. Performance prior to the inception date Class A and Class C is that of the Institutional Class. The date used to calculate benchmark performance is that of the Institutional Class. Average Annual Total Returns with sales charge reflect deduction of current maximum initial sales charge of 4.25% for Class A shares and applicable contingent deferred sales charges (CDSC) for Class C shares. The maximum CDSC for Class C shares is 1%, which is reduced to 0% after 1 year.

*Total (net) expense represents the total annual operating expenses that shareholders pay (after the effect of fee waivers and/or expense reimbursement). Neuberger Berman Management LLC (“NBM”) contractually caps certain direct expenses of the Fund (excluding interest, taxes, brokerage commissions, acquired fund fees and expenses, dividend expenses relating to short sales, and extraordinary expenses, if any; consequently, total (net) expenses may exceed the contractual cap) through 10/31/2021 for Class A at 1.15% of average net assets, Class C at 1.85% of average net assets and Institutional Class at 0.75% of average net assets. Absent such arrangements, which cannot be changed without Board approval, the returns may have been lower. Information as of the most recent prospectus dated 2/28/2015.

Rankings are ©2015 Morningstar, Inc. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers, (2) may not be copied or distributed and (3) is not warranted to be accurate, complete or timely.

The “Neuberger Berman” name and logo are registered service marks of Neuberger Berman Group LLC. “Neuberger Berman Management LLC” and the individual Fund names in this piece are either service marks or registered service marks of Neuberger Berman Management LLC.

© 2015 Neuberger Berman Management LLC. All rights reserved. © 2015 Neuberger Berman Management LLC, distributor.