Nicole Schaltenbrand: So, we placed it on non-accrual effective October 1, and we did reverse one month. So, the September of 2022 month of interest, which was less than $75,000 of interest was…
Mickey Schleien: Okay. That’s it for me this morning. I appreciate your time. Thank you.
Bob Marcotte: Thanks, Mickey.
Operator: Thank you. The next question is from the line of Robert Dodd with Raymond James. Please proceed with your questions.
Robert Dodd: Hi, and congratulations on the quarter, and also want to say thank you for that detailed answer to Mickey’s question on the interest coverage and the leverage by kind of sized here. That’s really, really helpful. On the pipeline, if I can, I mean, you — in response — in your prepared remarks and in response to Mickey’s questions, like, you talked about — I mean, obviously, it was a little — you had originated a lot to kind of entries to the pipeline that started to refill again. I mean, how would you rank the pipeline in terms of looking forward maybe beyond January? How it’s stacking up and the quality of the businesses that are in it, given you were clearly — you’re taking a somewhat more conservative stance on what you’re willing to underwrite or how you want to underwrite in this economic uncertainty period?
Bob Marcotte: It’s an interesting question. I would say there’s probably a couple of different nuances there, Robert. First off, I think if you read some of the recently released reports, tightening credit conditions has squeezed a lot of folks out of the marketplace today. A lot of the regional banks, a lot of the larger banks and capital constraints in a number of places have really moved all of the borrowers to the private capital markets. So, being open as we are today, we’re getting to see an awful lot of stuff. What we are seeing runs the gamut, deals that didn’t close because somebody couldn’t fund them to deals that probably shouldn’t close given the uncertainty of the market conditions. So, I think what we’re seeing is a very wide swath of our opportunities, and it’s really up to us to stress those against our historical screens to figure out which of those we feel have the forward momentum to be able to deleverage in the way we typically underwrite credits.
And so, for us, the good news is, as time goes on, we’re seeing current numbers, we’re seeing current ’23 outlooks and budgets. And if people start to negatively trends to their plan, two things typically happen. Sponsors don’t buy them, because they’re not going to hit their targets. And two, they are not going to give us the profile to deleverage the risks that we were expecting. So, there’s a natural — the deal falls away, because the visibility or the sponsors don’t think they can make the valuations work. For us, today, we do have a number of things out there, but it’s all based on trends that we are seeing continued deleveraging. Obviously, because we do deal with smaller credits, there are pockets where things are doing very well. And our focus in those is really just the sustainability of those businesses.
