On September 7, 2018, the staff of the Division of Investment Management of the SEC (the “Staff”) issued a no-action letter (the “Letter”) resolving a conflict between the U.S. Risk Retention Rules and the U.S. Investment Company Act of 1940, as amended (the “1940 Act”) in favor of a collateral manager of certain balance sheet collateralized loan obligation transactions (“CLOs”) that had requested relief in connection with a transfer of 100% of its risk retention interest to its externally managed business development company (“BDC”) originators. The Letter was addressed to Golub Capital BDC, Inc. and certain of its affiliates (“Golub”), which had requested assurance that the Staff would not recommend that the SEC take enforcement action under the 1940 Act in connection with the proposed risk retention interest transfer and related transactions.
