Erik Zwick: Good morning. I wanted to start just maybe a quick follow-up. Kipp you mentioned earlier, there’s some uncertainty, I think, as we all know with regard to the future direction of interest rates and just looking at Slide 5, percentage of fixed rate investments in the portfolio is up a little bit year-over-year, not a huge change by any means. But curious if that’s reflective at all of either your preference or borrower preference to maybe do floating versus fixed, given their belief in the direction of interest rates or maybe that’s more kind of natural migration from quarter-to-quarter?
Kipp DeVeer: Yes, I don’t think there’s anything particularly targeted there. I will say when we do some of our junior capital investing, we try to strike the right balance between floating and fixed rate, and frankly, have a mix of both. But yes, I think you’re right, that one borrower today may say I want fixed because I think we’re higher for longer than another borrower may say the exact opposite. So, there’s nothing particularly intentional there and different situations just lead to different outcomes. I wouldn’t take too much away.
Kort Schnabel: Nothing intentional around the small change quarter-to-quarter, but definitely intentional in terms of having some fixed rate exposure in the portfolio, which I think is a differentiator for us versus others in the market and just gives us more balance to operate through all different kinds of environments. Some of that fixed rate, as Kipp mentioned, the junior capital tying back to his comment about some of the opportunistic situations we’re seeing for delevering balance sheets right now given the higher rates, a lot of those are also fixed rate opportunities. So, that’s probably driving a little bit of that pickup that you’re seeing.
Erik Zwick: Thanks. I appreciate the color there. And just a bit of a follow-up as well on kind of your funding strategy today, you noticed — or mentioned how active you’ve been then the first part of the year on the unsecured debt market, the spreads have been very attractive and tight for you. So, you’re up to about, I guess, 78% of unsecured debt to total debt at this point. And I wonder if you could just kind of refresh on your bigger picture view of over time, what your preferred mix is? And it sounds like, as you noted as well, CLOs have kind of reentered the picture as well. So, just curious of your overall kind of bigger picture thoughts there.
Scott Lem: Yes. Look, I think we’re always — our investment-grade rating is very important to us and maintaining that and definitely a big component of that is making sure we’re majority unsecured. So, I think we’re probably a little heavier unsecured at the moment than we would normally, but I think we’re happy at the levels we’re at now. And I think like doing the CLO and other forms of secured financing are also part of our — like I mentioned, part of our playbook. So, we’ll continue to probably do everything.
Erik Zwick: Great. Thanks for taking my questions today.
Kipp DeVeer: Thank you.
Operator: [Operator Instructions] Our next question will come from Robert Dodd with Raymond James.
Robert Dodd: Good morning. Kipp last quarter, you gave us an update on the AA side of the portfolio, there were some liquidity questions. Obviously, I mean, noncore is not really low, there is only one new one this quarter. If I look at the revolver and delayed raw utilization, they go up a couple of hundred basis points this quarter, but not a lot. So, can you give us any more color on what the liquidity pressures are in the tail end to the portfolio? And do you think if rates do stay higher for longer into 2025, is there a point in which there’s liquidity pressures really become tough on that?
Kipp DeVeer: Yes, thanks for the question, Robert. I mean we saw a modest, but I wouldn’t say a material uptick in just revolver drawdown. That probably does obviously tell us that there’s likely companies that obviously have less liquidity than they might like, and I mentioned this a bit earlier in the call. It’s kind of a unique period, at least in my opinion, having done this a long time because you have a lot of pretty strong company performance. And even with that strong company performance, you have capital structures that got set up that may be can’t live through 5% base rates for a long period of time. And that’s why you’re seeing more equity and more structured equity come in to deleverage a lot of these situations with potential for rates to remain higher for longer, which frankly, is kind of our baseline expectation around here.
So, we’re managing the portfolio and thinking about risk as if we have higher base rates for longer. But again, none of our metrics have really shifted materially, right? Our non-accruals are up a touch but materially below historical averages. And again, when you look at what we consider to be our underperformers and watchlist, the 1s and the 2s, it’s pretty consistent in terms of the percentage of the portfolio. So, all-in-all, as a big macro overlay to thinking about the portfolio as a whole, we definitely take that into consideration and that’s how we think about managing the assets today, but it’s not a particular concern.
Robert Dodd: Got it. Thank you. And one more, if I can. Obviously, on peak and I don’t necessarily have a huge problem with peak, but peak collections for the last couple of quarters have been quite low. Obviously, I think cash peak collections voluntary by the borrower rather than repayment. I mean is there any trends there? I mean it’s volatile quarter-to-quarter anyway, but anything you’re seeing from borrowers who might have in the past don’t want to pay their peak in cash and are electing to just hold the cash now instead?
