UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-03894
T. Rowe Price Short-Term Bond Fund, Inc.
(Exact name of registrant as specified in charter)
100 East Pratt Street, Baltimore, MD 21202
(Address of principal executive offices)
David Oestreicher
100 East Pratt Street, Baltimore, MD 21202
(Name and address of agent for service)
Registrant’s telephone number, including area code: (410) 345-2000
Date of fiscal year end: May 31
Date of reporting period: November 30, 2022
Item 1. Reports to Shareholders
(a) Report pursuant to Rule 30e-1
Highlights
and
Market
Commentary
Management’s
Discussion
of
Fund
Performance
Performance
and
Expenses
Financial
Highlights
Portfolio
of
Investments
Financial
Statements
and
Notes
Additional
Fund
Information
November
30,
2022
SemiAnnual
Report
For
more
insights
from
T.
Rowe
Price
investment
professionals,
go
to
troweprice.com
.
T.
ROWE
PRICE
TSDLX
Short
Duration
Income
Fund
–
.
TSIDX
Short
Duration
Income
Fund–
.
I Class
T.
ROWE
PRICE
Short
Duration
Income
Fund
HIGHLIGHTS
The
Short
Duration
Income
Fund
underperformed
its
benchmark
and
its
Lipper
peer
group
average
during
the
six-month
period
ended
November
30,
2022.
Shorter-maturity
bond
markets
were
adversely
impacted
by
macro-
and
interest
rate-driven
volatility
during
the
reporting
period.
Relative
to
the
benchmark,
we
continued
to
underweight
investment-grade
corporate
bonds
while
diversifying
the
portfolio
and
adding
yield
by
overweighting
high
yield
corporate
debt
and
taking
out-of-benchmark
positions
in
securitized
sectors
and
emerging
market
debt.
Using
the
breadth
and
depth
of
our
global
research
platform,
we
will
look
to
selectively
add
to
high-conviction
positions
as
volatility
creates
attractive
entry
points.
Log
in
to
your
account
at
troweprice.com
for
more
information.
*
Certain
mutual
fund
accounts
that
are
assessed
an
annual
account
service
fee
can
also
save
money
by
switching
to
e-delivery.
T.
ROWE
PRICE
Short
Duration
Income
Fund
Market
Commentary
1
Dear
Shareholder
Global
stock
markets
generally
produced
negative
returns
during
the
first
half
of
your
fund’s
fiscal
year,
the
six-month
period
ended
November
30,
2022,
while
rising
bond
yields
weighed
on
returns
for
fixed
income
investors.
Investors
contended
with
tightening
financial
conditions
and
slowing
economic
and
corporate
earnings
growth,
but
hopes
that
persistently
high
inflation
might
be
easing
helped
spark
a
rally
late
in
the
period
that
partially
offset
earlier
losses.
In
the
U.S.,
equity
results
were
mixed.
The
Dow
Jones
Industrial
Average
recorded
positive
results
and
mid-cap
growth
stocks
also
performed
well,
while
most
other
benchmarks
finished
in
negative
territory.
The
S&P
500
Index
was
modestly
negative
for
the
period,
but
results
varied
widely
at
the
sector
level,
with
industrials
and
energy
shares
delivering
strong
gains
while
communication
services
stocks
struggled.
Outside
the
U.S.,
major
country
and
regional
benchmarks
lost
ground.
Emerging
markets
stocks
generally
underperformed
shares
in
developed
markets.
Meanwhile,
the
U.S.
dollar
strengthened
versus
most
currencies
during
the
period,
which
weighed
on
returns
for
U.S.
investors
in
international
securities.
Elevated
inflation
remained
a
leading
concern
for
investors
throughout
the
period,
although
hopes
that
inflation
may
have
peaked
led
to
rallies
during
the
summer
and
again
in
November.
The
October
consumer
price
index
report,
which
was
released
in
mid-November,
was
better
than
expected
and
showed
price
increases
easing
from
recent
40-year
highs.
However,
the
7.7%
year-over-
year
increase
in
the
headline
inflation
number
remained
well
above
the
Fed’s
2%
target.
In
response
to
the
high
inflation
readings,
global
central
banks
continued
to
tighten
monetary
policy,
and
investors
focused
on
communications
from
central
bank
officials
on
how
high
rates
would
have
to
go.
The
Federal
Reserve
delivered
four
historically
large
75-basis-point
(0.75
percentage
point)
rate
hikes
during
the
period,
which
lifted
its
short-term
lending
benchmark
to
a
target
range
of
3.75%
to
4.00%
by
early
November,
the
highest
level
since
2008.
As
our
reporting
period
came
to
an
end,
Fed
officials
signaled
that
they
were
likely
to
dial
back
the
pace
of
rate
increases.
Bond
yields
increased
considerably
across
the
Treasury
yield
curve
as
the
Fed
tightened
monetary
policy,
with
the
yield
on
the
benchmark
10-year
U.S.
Treasury
note
climbing
from
2.85%
at
the
start
of
the
period
to
3.68%
at
the
end
of
November.
Significant
inversions
in
the
Treasury
curve,
which
are
often
considered
a
warning
sign
of
a
coming
recession,
occurred
during
the
period
T.
ROWE
PRICE
Short
Duration
Income
Fund
2
as
shorter-maturity
Treasuries
experienced
the
largest
yield
increases.
The
sharp
increase
in
yields
led
to
generally
negative
results
across
the
fixed
income
market
as
bond
prices
and
yields
move
in
opposite
directions.
On
a
positive
note,
the
U.S.
jobs
market
remained
resilient
during
the
period,
and
overall
economic
growth
turned
positive
in
the
third
quarter
after
two
slightly
negative
quarters.
However,
recession
fears
also
grew
as
corporate
earnings
slowed
and
manufacturing
gauges
drifted
toward
contraction
levels.
In
addition,
the
housing
market
began
to
weaken
as
mortgage
rates
climbed
to
the
highest
level
in
more
than
20
years.
The
past
year
has
been
a
trying
time
for
investors
as
few
sectors
remained
untouched
by
the
broad
headwinds
that
markets
faced,
and
volatility
may
continue
in
the
near
term
as
central
banks
tighten
policy
amid
slowing
economic
growth.
However,
in
our
view,
valuations
have
become
more
attractive
across
many
market
sectors
during
the
downturn,
which
provides
potential
opportunities
for
selective
investors
focused
on
fundamentals.
We
believe
this
environment
makes
skilled
active
management
a
critical
tool
for
identifying
risks
and
opportunities,
and
our
investment
teams
will
continue
to
use
fundamental
research
to
identify
securities
that
can
add
value
to
your
portfolio
over
the
long
term.
Thank
you
for
your
continued
confidence
in
T.
Rowe
Price.
Sincerely,
Robert
Sharps
CEO
and
President
T.
ROWE
PRICE
Short
Duration
Income
Fund
Management’s
Discussion
of
Fund
Performance
3
INVESTMENT
OBJECTIVE
The
fund
seeks
to
provide
income
consistent
with
limited
fluctuation
in
principal
value
and
liquidity.
FUND
COMMENTARY
How
did
the
fund
perform
in
the
past six
months?
The
Short
Duration
Income
Fund
returned
-2.14%
in
the
six
months
ended
November
30,
2022.
The
fund
underperformed
its
benchmark,
the
Bloomberg
1–3
Year
U.S.
Corporate
Bond
Index,
as
well
as
its
Lipper
peer
group
average.
(Returns
for
the
I
Class
shares
will
vary,
reflecting
a
different
fee
structure.
Past
performance
cannot
guarantee
future
results.
)
What
factors
influenced
the
fund’s
performance?
Shorter-maturity
bond
markets
were
adversely
impacted
by
macro-
and
interest
rate-driven
volatility
during
the
reporting
period.
Macroeconomic
sentiment
was
mixed
as
hopes
of
slower
Federal
Reserve
rate
hikes
supported
risk
assets
before
hawkish
rhetoric,
elevated
inflation,
and
tightness
in
the
labor
market
quelled
expectations
of
capitulation
from
the
Fed.
While
credit
spreads
on
one-
to
three-year
corporate
bonds
ended
the
period
little
changed,
corporate
bonds
produced
negative
absolute
returns
as
rising
U.S.
Treasury
yields
dragged
bond
prices
lower.
(Credit
spreads
are
a
measure
of
the
additional
yield
offered
by
bonds
that
have
credit
risk
compared
with
U.S.
Treasuries
with
similar
maturities.)
Treasuries
declined
in
value
over
the
reporting
period.
Front-end
Treasury
yields
rose
throughout
most
of
the
period
as
investors
priced
in
a
higher-
for-longer
interest
rate
regime.
However,
economic
data
appeared
to
begin
reflecting
tighter
financial
conditions
as
the
period
progressed,
which
revitalized
expectations
for
smaller
rate
hikes
and
sent
yields
on
Treasury
notes
and
bonds
lower
in
November.
The
two-year
Treasury
yield
began
the
period
at
2.53%,
reached
4.72%
in
early
November,
but
ended
the
period
at
4.38%.
PERFORMANCE
COMPARISON
Six-Month
Period
Ended
11/30/22
Total
Return
Short
Duration
Income
Fund
–
.
-2.14%
Short
Duration
Income
Fund–
.
I Class
-2.09
Bloomberg
1–3
Year
U.S.
Corporate
Bond
Index
-1.07
Lipper
Short
Investment
Grade
Debt
Funds
Average
-1.37
T.
ROWE
PRICE
Short
Duration
Income
Fund
4
Sector
allocations
detracted
from
the
fund’s
relative
performance
in
aggregate.
Out-of-benchmark
allocations
to
securitized
sectors
weighed
on
relative
results
alongside
volatility
in
the
rates
market.
Our
allocation
to
residential
mortgage-backed
securities
was
a
prominent
detractor,
as
rate
volatility
and
challenged
liquidity
pushed
the
interest
rate-sensitive
sector’s
spreads
notably
wider.
Conversely,
the
fund’s
allocation
to
investment-grade
(IG)
corporate
bonds
modestly
aided
relative
results
as
we
were
able
to
opportunistically
take
advantage
of
volatility
and
credit
spread
widening
during
the
period
despite
remaining
underweight
the
sector.
In
aggregate,
interest
rate
management
weighed
on
relative
results.
While
yield
curve
positioning
had
a
positive
impact
and
the
fund’s
overall
average
duration
was
neutral
to
its
benchmark,
intra-period
duration
positioning
tilted
higher
at
multiple
points
and
negatively
impacted
total
performance.
(Duration
measures
a
bond’s
or
a
bond
fund’s
sensitivity
to
changes
in
interest
rates.)
Security
selection
among
IG
and
high
yield
corporate
bonds
was
constructive.
Bonds
in
the
consumer
noncyclical
sector
outperformed
as
periods
of
credit
spread
widening
brought
heightened
demand
for
bonds
with
defensive
characteristics.
In
addition,
while
we
are
primarily
a
cash
bond
manager,
we
employ
the
limited
use
of
derivatives
in
our
strategy
for
hedging
purposes.
Derivatives
may
include
futures
and
options,
as
well
as
credit
default
and
interest
rate
swaps.
During
the
reporting
period,
our
use
of
derivatives,
particularly
Treasury
futures,
detracted
from
absolute
performance.
How
is
the
fund
positioned?
Relative
to
the
benchmark,
we
continued
to
underweight
IG
corporate
bonds
while
diversifying
the
portfolio
and
adding
yield
by
overweighting
high
yield
corporate
debt
and
taking
out-of-benchmark
positions
in
securitized
sectors
and
emerging
markets
(EM)
debt.
Corporate
debt
represented
just
above
40%
of
net
assets
at
the
end
of
the
reporting
period.
Bonds
rated
BBB,
which
our
research
analysts
believe
are
often
mispriced
and
offer
attractive
relative
value,
were
a
significant
holding.
At
the
beginning
of
the
period,
we
bolstered
liquidity
and
reduced
our
credit
risk
exposure
across
securitized
sectors,
U.S.
high
yield,
and
IG
corporates
as
the
Fed
turned
hawkish
and
economic
data
showed
further
slowing
and
potential
downside
risks.
As
valuations
and
all-in
yields
(the
total
yield
garnered
from
purchasing
and
holding
a
debt
instrument,
including
coupon
payments
and
new
issue
premiums)
became
increasingly
attractive,
we
deployed
some
of
this
built-up
liquidity
to
increase
our
allocation
to
IG
corporates.
Within
the
asset
class,
we
focused
our
additions
on
higher-
T.
ROWE
PRICE
Short
Duration
Income
Fund
5
quality
bonds
that
were
trading
at
valuations
that
were
disconnected
from
fundamentals,
in
our
view.
In
addition,
we
continued
to
hold
out-of-
benchmark
positions
in
EM
corporate
bonds
to
pick
up
a
yield
advantage
over
IG
corporate
bonds.
Securitized
sectors
continued
to
provide
steady
income
and
diversification
benefits.
We
held
out-of-benchmark
positions
in
securitized
sectors
to
capture
a
risk-
adjusted
yield
advantage
over
IG
corporate
bonds
while
also
diversifying
risk
positioning.
However,
amid
elevated
liquidity
risk,
we
modestly
reduced
our
allocations
to
asset-
backed
securities,
residential
mortgage-backed
securities,
and
commercial
mortgage-
backed
securities.
Ultimately,
we
maintain
a
relatively
sanguine
long-term
view
on
these
sectors
given
supportive
fundamentals
and
credit
structures.
The
potential
for
some
reprieve
in
the
headwinds
from
rates
over
the
next
year
also
makes
these
sectors
compelling
to
us
over
a
longer
time
horizon.
Sources:
Credit
ratings
for
the
securities
held
in
the
fund
are
provided
by
Moody’s,
Standard
&
Poor’s,
and
Fitch
and
are
converted
to
the
Standard
&
Poor’s
nomenclature.
A
rating
of
AAA
represents
the
highest-
rated
securities,
and
a
rating
of
D
represents
the
lowest-
rated
securities.
If
the
rating
agencies
differ,
the
highest
rating
is
applied
to
the
security.
If
a
rating
is
not
available,
the
security
is
classified
as
Not
Rated.
T.
Rowe
Price
uses
the
rating
of
the
underlying
investment
vehicle
to
determine
the
creditworthiness
of
credit
default
swaps.
The
fund
is
not
rated
by
any
agency.
*
U.S.
government
agency
securities
are
issued
or
guaranteed
by
a
U.S.
government
agency
and
may
include
conventional
pass-through
securities
and
collateralized
mortgage
obligations;
unlike
Treasuries,
government
agency
securities
are
not
issued
directly
by
the
U.S.
government
and
are
generally
unrated
but
may
have
credit
support
from
the
U.S.
Treasury
(e.g.,
FHLMC
and
FNMA
issues)
or
a
direct
government
guarantee
(e.g.,
GNMA
issues).
Therefore,
this
category
may
include
rated
and
unrated
securities.
**
U.S.
Treasury
securities
are
issued
by
the
U.S.
Treasury
and
are
backed
by
the
full
faith
and
credit
of
the
U.S.
government.
The
ratings
of
U.S.
Treasury
securities
are
derived
from
the
ratings
on
the
U.S.
government.
CREDIT
QUALITY
DIVERSIFICATION
Short
Duration
Income
Fund
T.
ROWE
PRICE
Short
Duration
Income
Fund
6
Amid
the
hawkish
shift
in
Fed
rhetoric
that
occurred
in
the
summer,
we
moved
down
to
a
roughly
neutral
average
duration
profile
relative
to
the
benchmark.
We
remained
cautious
in
terms
of
adding
duration
while
questions
remained
about
the
Fed’s
monetary
policy
tightening
path,
and
the
fund’s
duration
ended
the
period
lower
than
it
started
as
a
result.
Moving
forward,
we
will
continue
to
monitor
changes
in
economic
data
and
financial
conditions
to
gauge
opportunity
and
risk
in
our
duration
positioning.
What
is
portfolio
management’s
outlook?
While
there
are
signs
that
inflationary
pressures
have
peaked,
the
outlook
remains
uncertain
amid
continued
monetary
policy
tightening,
mounting
downside
growth
risks,
and
elevated
volatility
in
risk
assets.
Financial
conditions
have
rapidly
tightened
this
year,
and
recent
economic
data
releases
show
that
the
economy
has
started
to
cool.
Alongside
signs
of
slowing
economic
growth,
broader
inflation
pressures
are
rotating
into
parts
of
the
economy
where
price
increases
are
more
likely
to
last,
making
the
Fed’s
job
of
containing
price
pressures
even
more
challenging.
The
path
of
monetary
policy
will
be
driven
by
data
that
could
cause
volatility
to
remain
elevated
around
future
data
releases,
and
interest
rate
volatility
will
likely
continue
to
be
a
key
driver
for
credit
spreads.
Consumer
savings
rates
have
dipped
below
their
pre-pandemic
norms
as
consumers
have
used
excess
savings
to
cushion
the
impact
of
higher
prices.
That
said,
many
consumers
and
corporations
have
healthy
reserves
and
limited
leverage,
which
should
help
them
navigate
near-term
inflationary
pressures.
In
this
environment
of
heightened
volatility,
active
management
can
play
an
even
more
instrumental
role
in
achieving
investor
objectives.
Our
continued
goal
is
to
provide
high-quality,
durable
yield
and
income
appropriate
for
a
short-term
bond
strategy
with
modest
credit
and
duration
risk.
Using
the
breadth
and
depth
of
our
global
research
platform,
we
will
look
to
selectively
add
to
high-conviction
positions
as
volatility
creates
attractive
entry
points.
The
views
expressed
reflect
the
opinions
of
T.
Rowe
Price
as
of
the
date
of
this
report
and
are
subject
to
change
based
on
changes
in
market,
economic,
or
other
conditions.
These
views
are
not
intended
to
be
a
forecast
of
future
events
and
are
no
guarantee
of
future
results.
T.
ROWE
PRICE
Short
Duration
Income
Fund
7
RISKS
OF
INVESTING
IN
FIXED
INCOME
SECURITIES
The
value
of
investments
held
by
the
fund
may
decline,
sometimes
rapidly
or
unpredictably,
due
to
factors
affecting
certain
issuers,
particular
industries
or
sectors,
or
the
overall
markets.
Rapid
changes
in
interest
rates
may
increase
the
fund’s
overall
exposure
to
interest
rate
risk.
An
issuer
of
a
debt
instrument
held
by
the
fund
could
default
(fail
to
make
scheduled
interest
or
principal
payments),
potentially
reducing
the
fund’s
income
and
share
price.
Holdings
rated
below
investment
grade
should
be
regarded
as
speculative
because
their
issuers
may
be
more
susceptible
to
financial
setbacks
and
recession
than
more
creditworthy
issuers
(commonly
referred
to
as
“junk”).
Investments
in
emerging
markets
are
subject
to
the
risk
of
abrupt
and
severe
price
declines.
BENCHMARK
INFORMATION
Note:
Bloomberg
®
and the
Bloomberg
1–3
Year
U.S.
Corporate
Bond
Index
are
service
marks
of
Bloomberg
Finance
L.P.
and
its
affiliates,
including
Bloomberg
Index
Services
Limited
(“BISL”),
the
administrator
of
the
index
(collectively,
“Bloomberg”)
and
have
been
licensed
for
use
for
certain
purposes
by
T.
Rowe
Price.
Bloomberg
is
not
affiliated
with
T.
Rowe
Price,
and
Bloomberg
does
not
approve,
endorse,
review,
or
recommend
its
products.
Bloomberg
does
not
guarantee
the
timeliness,
accurateness,
or
completeness
of
any
data
or
information
relating
to
its
products.
Note:
Copyright
©
2022
Fitch
Ratings,
Inc.,
Fitch
Ratings
Ltd.
and
its
subsidiaries.
Note:
Portions
of
the
mutual
fund
information
contained
in
this
report
were
supplied
by
Lipper,
a
Refinitiv
Company,
subject
to
the
following:
Copyright
2022
©
Refinitiv.
All
rights
reserved.
Any
copying,
republication
or
redistribution
of
Lipper
content
is
expressly
prohibited
without
the
prior
written
consent
of
Lipper.
Lipper
shall
not
be
liable
for
any
errors
or
delays
in
the
content,
or
for
any
actions
taken
in
reliance
thereon.
Note:
©
2022,
Moody’s
Corporation,
Moody’s
Investors
Service,
Inc.,
Moody’s
Analytics,
Inc.
and/or
their
licensors
and
affiliates
(collectively,
“Moody’s”).
All
rights
reserved.
Moody’s
ratings
and
other
information
(“Moody’s
Information”)
are
proprietary
to
Moody’s
and/or
its
licensors
and
are
protected
by
copyright
and
other
intellectual
property
laws.
Moody’s
Information
is
licensed
to
Client
by
Moody’s.
MOODY’S
INFORMATION
MAY
NOT
BE
COPIED
OR
OTHERWISE
REPRODUCED,
REPACKAGED,
FURTHER
TRANSMITTED,
TRANSFERRED,
DISSEMINATED,
REDISTRIBUTED
T.
ROWE
PRICE
Short
Duration
Income
Fund
8
OR
RESOLD,
OR
STORED
FOR
SUBSEQUENT
USE
FOR
ANY
SUCH
PURPOSE,
IN
WHOLE
OR
IN
PART,
IN
ANY
FORM
OR
MANNER
OR
BY
ANY
MEANS
WHATSOEVER,
BY
ANY
PERSON
WITHOUT
MOODY’S
PRIOR
WRITTEN
CONSENT.
Moody's
®
is
a
registered
trademark.
Note:
Copyright
©
2022,
S&P
Global
Market
Intelligence
(and
its
affiliates,
as
applicable).
Reproduction
of
any
information,
data
or
material,
including
ratings
("Content")
in
any
form
is
prohibited
except
with
the
prior
written
permission
of
the
relevant
party. Such
party,
its
affiliates
and
suppliers
("Content
Providers")
do
not
guarantee
the
accuracy,
adequacy,
completeness,
timeliness
or
availability
of
any
Content
and
are
not
responsible
for
any
errors
or
omissions
(negligent
or
otherwise),
regardless
of
the
cause,
or
for
the
results
obtained
from
the
use
of
such
Content.
In
no
event
shall
Content
Providers
be
liable
for
any
damages,
costs,
expenses,
legal
fees,
or
losses
(including
lost
income
or
lost
profit
and
opportunity
costs)
in
connection
with
any
use
of
the
Content.
A
reference
to
a
particular
investment
or
security,
a
rating
or
any
observation
concerning
an
investment
that
is
part
of
the
Content
is
not
a
recommendation
to
buy,
sell
or
hold
such
investment
or
security,
does
not
address
the
appropriateness
of
an
investment
or
security
and
should
not
be
relied
on
as
investment
advice.
Credit
ratings
are
statements
of
opinions
and
are
not
statements
of
fact.
BENCHMARK
INFORMATION
(continued)
T.
ROWE
PRICE
Short
Duration
Income
Fund
9
GROWTH
OF
$10,000
This
chart
shows
the
value
of
a
hypothetical
$10,000
investment
in
the
fund
over
the
past
10
fiscal
year
periods
or
since
inception
(for funds
lacking
10-year
records).
The
result
is
compared
with
benchmarks,
which
include
a
broad-based
market
index
and
may
also
include
a
peer
group
average
or
index.
Market
indexes
do
not
include
expenses,
which
are
deducted
from
fund
returns
as
well
as
mutual fund
averages
and
indexes.
SHORT
DURATION
INCOME
FUND
Note:
Performance
for
the
I
Class share
will
vary
due
to
its differing
fee
structure.
See
the
Average
Annual
Compound
Total
Return
table.
*The
Lipper
Short
Investment
Grade
Debt
Funds
Average
is
from
12/31/20.
AVERAGE
ANNUAL
COMPOUND
TOTAL
RETURN
Periods
Ended
11/30/22
1
Year
Since
Inception
12/8/20
Short
Duration
Income
Fund
–
.
-5.42%
-2.33%
Short
Duration
Income
Fund–
.
I Class
-5.32
-2.23
This
table
shows
how
the
fund
would
have
performed
each
year
if
its
actual
(or
cumulative)
returns
for
the
periods
shown
had
been
earned
at
a
constant
rate.
Returns
do
not
reflect
taxes
that
the
shareholder
may
pay
on
fund
distributions
or
the
redemption
of
fund
shares.
Past
performance
cannot
guarantee
future
results.
T.
ROWE
PRICE
Short
Duration
Income
Fund
10
EXPENSE
RATIO
FUND
EXPENSE
EXAMPLE
As
a
mutual
fund
shareholder,
you
may
incur
two
types
of
costs:
(1)
transaction
costs,
such
as
redemption
fees
or
sales
loads,
and
(2)
ongoing
costs,
including
management
fees,
distribution
and
service
(12b-1)
fees,
and
other
fund
expenses.
The
following
example
is
intended
to
help
you
understand
your
ongoing
costs
(in
dollars)
of
investing
in
the
fund
and
to
compare
these
costs
with
the
ongoing
costs
of
investing
in
other
mutual
funds.
The
example
is
based
on
an
investment
of
$1,000
invested
at
the
beginning
of
the
most
recent
six-month
period
and
held
for
the
entire
period.
Please
note
that
the
fund
has
two
share
classes:
The
original
share
class
(Investor
Class)
charges
no
distribution
and
service
(12b-1)
fee,
and
the
I
Class
shares
are
also
available
to
institutionally
oriented
clients
and
impose
no
12b-1
or
administrative
fee
payment.
Each
share
class
is
presented
separately
in
the
table.
Actual
Expenses
The
first
line
of
the
following
table
(Actual)
provides
information
about
actual
account
values
and
expenses
based
on
the
fund’s
actual
returns.
You
may
use
the
information
on
this
line,
together
with
your
account
balance,
to
estimate
the
expenses
that
you
paid
over
the
period.
Simply
divide
your
account
value
by
$1,000
(for
example,
an
$8,600
account
value
divided
by
$1,000
=
8.6),
then
multiply
the
result
by
the
number
on
the
first
line
under
the
heading
“Expenses
Paid
During
Period”
to
estimate
the
expenses
you
paid
on
your
account
during
this
period.
Hypothetical
Example
for
Comparison
Purposes
The
information
on
the
second
line
of
the
table
(Hypothetical)
is
based
on
hypothetical
account
values
and
expenses
derived
from
the
fund’s
actual
expense
ratio
and
an
assumed
5%
per
year
rate
of
return
before
expenses
(not
the
fund’s
actual
return).
You
may
compare
the
ongoing
costs
of
investing
in
the
fund
with
other
funds
by
contrasting
this
5%
hypothetical
example
and
the
5%
hypothetical
examples
that
appear
in
the
shareholder
reports
of
the
other
funds.
The
hypothetical
account
values
and
expenses
may
not
be
used
to
estimate
the
actual
ending
account
balance
or
expenses
you
paid
for
the
period.
Short
Duration
Income
Fund
0.97%
Short
Duration
Income
Fund–I
Class
0.93
The
expense
ratio
shown
is
as
of
the
fund’s
most
recent
prospectus.
This
number
may
vary
from
the
expense
ratio
shown
elsewhere
in
this
report
because
it
is
based
on
a
different
time
period
and,
if
applicable,
includes
acquired
fund
fees
and
expenses
but
does
not
include
fee
or
expense
waivers.
T.
ROWE
PRICE
Short
Duration
Income
Fund
11
Note:
T.
Rowe
Price
charges
an
annual
account
service
fee
of
$20,
generally
for
accounts
with
less
than
$10,000.
The
fee
is
waived
for
any
investor
whose
T.
Rowe
Price
mutual
fund
accounts
total
$50,000
or
more;
accounts
electing
to
receive
electronic
delivery
of
account
statements,
transaction
confirmations,
prospectuses,
and
shareholder
reports;
or
accounts
of
an
investor
who
is
a
T.
Rowe
Price
Personal
Services
or
Enhanced
Personal
Services
client
(enrollment
in
these
programs
generally
requires
T.
Rowe
Price
assets
of
at
least
$250,000).
This
fee
is
not
included
in
the
accompanying
table.
If
you
are
subject
to
the
fee,
keep
it
in
mind
when
you
are
estimating
the
ongoing
expenses
of
investing
in
the
fund
and
when
comparing
the
expenses
of
this
fund
with
other
funds.
You
should
also
be
aware
that
the
expenses
shown
in
the
table
highlight
only
your
ongoing
costs
and
do
not
reflect
any
transaction
costs,
such
as
redemption
fees
or
sales
loads.
Therefore,
the
second
line
of
the
table
is
useful
in
comparing
ongoing
costs
only
and
will
not
help
you
determine
the
relative
total
costs
of
owning
different
funds.
To
the
extent
a
fund
charges
transaction
costs,
however,
the
total
cost
of
owning
that
fund
is
higher.
SHORT
DURATION
INCOME
FUND
Beginning
Account
Value
6/1/22
Ending
Account
Value
11/30/22
Expenses
Paid
During
Period*
6/1/22
to
11/30/22
Investor
Class
Actual
$1,000.00
$978.60
$1.98
Hypothetical
(assumes
5%
return
before
expenses)
1,000.00
1,023.06
2.03
I
Class
Actual
1,000.00
979.10
1.49
Hypothetical
(assumes
5%
return
before
expenses)
1,000.00
1,023.56
1.52
*
Expenses
are
equal
to
the
fund’s
annualized
expense
ratio
for
the
6-month
period,
multiplied
by
the
average
account
value
over
the
period,
multiplied
by
the
number
of
days
in
the
most
recent
fiscal
half
year
(183),
and
divided
by
the
days
in
the
year
(365)
to
reflect
the
half-year
period.
The
annualized
expense
ratio
of
the
Investor
Class
was
0.40%,
and
the
I Class
was
0.30%.
FUND
EXPENSE
EXAMPLE
(CONTINUED)
T.
ROWE
PRICE
Short
Duration
Income
Fund
12
QUARTER-END
RETURNS
Periods
Ended
9/30/22
1
Year
Since
Inception
12/8/20
Short
Duration
Income
Fund
–
.
-6.60%
-2.88%
Short
Duration
Income
Fund–
.
I Class
-6.50
-2.77
The
fund’s
performance
information
represents
only
past
performance
and
is
not
necessarily
an
indication
of
future
results.
Current
performance
may
be
lower
or
higher
than
the
performance
data
cited.
Share
price,
principal
value,
and
return
will
vary,
and
you
may
have
a
gain
or
loss
when
you
sell
your
shares.
For
the
most
recent
month-end
performance,
please
visit
our
website
(troweprice.com)
or
contact
a
T.
Rowe
Price
representative
at
1
-
800
-
225
-
5132
or,
for
200
I
Class
shares,
1-800-638-8790
.
This
table
provides
returns
through
the
most
recent
calendar
quarter-end
rather
than
through
the
end
of
the
fund’s
fiscal
period.
It
shows
how
each
class
would
have
performed
each
year
if
its
actual
(or
cumulative)
returns
for
the
periods
shown
had
been
earned
at
a
constant
rate.
Average
annual
total
return
figures
include
changes
in
principal
value,
reinvested
dividends,
and
capital
gain
distributions.
Returns
do
not
reflect
taxes
that
the
shareholder
may
pay
on
fund
distributions
or
the
redemption
of
fund
shares.
When
assessing
performance,
investors
should
consider
both
short-
and
long-term
returns.
T.
ROWE
PRICE
Short
Duration
Income
Fund
(Unaudited)
Financial
Highlights
13
For
a
share
outstanding
throughout
each
period
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Investor
Class
(1)
6
Months
.
Ended
11/30/22
.
.
Year
Ended
5/31/22
12/8/20
(1)
Through
5/31/21
NET
ASSET
VALUE
Beginning
of
period
$
9.51
$
10.05
$
10.00
Investment
activities
Net
investment
income
(2)(3)
0.13
0.17
0.07
Net
realized
and
unrealized
gain/loss
(0.33)
(0.53)
0.05
Total
from
investment
activities
(0.20)
(0.36)
0.12
Distributions
Net
investment
income
(0.13)
(0.17)
(0.07)
Net
realized
gain
—
(0.01)
—
Total
distributions
(0.13)
(0.18)
(0.07)
NET
ASSET
VALUE
End
of
period
$
9.18
$
9.51
$
10.05
Ratios/Supplemental
Data
Total
return
(3)(4)
(2.14)%
(3.64)%
1.21%
Ratios
to
average
net
assets:
(3)
Gross
expenses
before
waivers/payments
by
Price
Associates
1.07%
(5)
0.97%
1.32%
(5)
Net
expenses
after
waivers/payments
by
Price
Associates
0.40%
(5)
0.40%
0.40%
(5)
Net
investment
income
2.77%
(5)
1.72%
1.47%
(5)
Portfolio
turnover
rate
49.4%
60.1%
24.7%
Net
assets,
end
of
period
(in
thousands)
$29,198
$31,100
$42,912
0%
0%
0%
(1)
Inception
date
(2)
Per
share
amounts
calculated
using
average
shares
outstanding
method.
(3)
See
Note
6
for
details
of
expense-related
arrangements
with
Price
Associates.
(4)
Total
return
reflects
the
rate
that
an
investor
would
have
earned
on
an
investment
in
the
fund
during
each
period,
assuming
reinvestment
of
all
distributions,
and
payment
of
no
redemption
or
account
fees,
if
applicable.
Total
return
is
not
annualized
for
periods
less
than
one
year.
(5)
Annualized
T.
ROWE
PRICE
Short
Duration
Income
Fund
(Unaudited)
Financial
Highlights
14
For
a
share
outstanding
throughout
each
period
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
I
Class
(1)
6
Months
.
Ended
11/30/22
.
.
Year
Ended
5/31/22
12/8/20
(1)
Through
5/31/21
NET
ASSET
VALUE
Beginning
of
period
$
9.51
$
10.05
$
10.00
Investment
activities
Net
investment
income
(2)(3)
0.13
0.19
0.07
Net
realized
and
unrealized
gain/loss
(0.33)
(0.54)
0.06
Total
from
investment
activities
(0.20)
(0.35)
0.13
Distributions
Net
investment
income
(0.13)
(0.18)
(0.08)
Net
realized
gain
—
(0.01)
—
Total
distributions
(0.13)
(0.19)
(0.08)
NET
ASSET
VALUE
End
of
period
$
9.18
$
9.51
$
10.05
Ratios/Supplemental
Data
Total
return
(3)(4)
(2.09)%
(3.53)%
1.27%
Ratios
to
average
net
assets:
(3)
Gross
expenses
before
waivers/payments
by
Price
Associates
0.98%
(5)
0.93%
1.49%
(5)
Net
expenses
after
waivers/payments
by
Price
Associates
0.30%
(5)
0.29%
0.29%
(5)
Net
investment
income
2.88%
(5)
1.98%
1.57%
(5)
Portfolio
turnover
rate
49.4%
60.1%
24.7%
Net
assets,
end
of
period
(in
thousands)
$17,645
$17,250
$251
0%
0%
0%
(1)
Inception
date
(2)
Per
share
amounts
calculated
using
average
shares
outstanding
method.
(3)
See
Note
6
for
details
of
expense-related
arrangements
with
Price
Associates.
(4)
Total
return
reflects
the
rate
that
an
investor
would
have
earned
on
an
investment
in
the
fund
during
each
period,
assuming
reinvestment
of
all
distributions,
and
payment
of
no
redemption
or
account
fees,
if
applicable.
Total
return
is
not
annualized
for
periods
less
than
one
year.
(5)
Annualized
T.
ROWE
PRICE
Short
Duration
Income
Fund
November
30,
2022
(Unaudited)
15
Portfolio
of
Investments
‡
Par/Shares
$
Value
(Amounts
in
000s)
‡
ASSET-BACKED
SECURITIES
16.2%
Car
Loan
6.1%
AmeriCredit
Automobile
Receivables
Trust
Series 2020-2,
Class
D
2.13%,
3/18/26
120
112
Avis
Budget
Rental
Car
Funding
AESOP
Series 2018-1A,
Class
D
5.25%,
9/20/24 (1)
110
108
Carmax
Auto
Owner
Trust
Series 2020-1,
Class
D
2.64%,
7/15/26
115
109
CarMax
Auto
Owner
Trust
Series 2020-3,
Class
C
1.69%,
4/15/26
50
47
CarMax
Auto
Owner
Trust
Series 2021-2,
Class
C
1.34%,
2/16/27
250
224
Drive
Auto
Receivables
Trust
Series 2021-1,
Class
D
1.45%,
1/16/29
150
140
Exeter
Automobile
Receivables
Trust
Series 2021-2A,
Class
C
0.98%,
6/15/26
75
71
Exeter
Automobile
Receivables
Trust
Series 2022-4A,
Class
D
5.98%,
12/15/28
45
42
Exeter
Automobile
Receivables
Trust
Series 2022-64,
Class
A3
5.70%,
8/17/26
25
25
Ford
Credit
Auto
Lease
Trust
Series 2022-A,
Class
C
4.18%,
10/15/25
255
247
GM
Financial
Automobile
Leasing
Trust
Series 2021-1,
Class
D
1.01%,
7/21/25
140
134
GM
Financial
Automobile
Leasing
Trust
Series 2022-3,
Class
C
5.13%,
8/20/26
245
239
GM
Financial
Consumer
Automobile
Receivables
Trust
Series 2020-3,
Class
C
1.37%,
1/16/26
30
28
GM
Financial
Consumer
Automobile
Receivables
Trust
Series 2020-4,
Class
C
1.05%,
5/18/26
50
46
JPMorgan
Chase
Bank
Series 2021-2,
Class
D
1.138%,
12/26/28 (1)
115
109
T.
ROWE
PRICE
Short
Duration
Income
Fund
16
Par/Shares
$
Value
(Amounts
in
000s)
‡
Santander
Bank
-
SBCLN
Series 2021-1A,
Class
C
3.268%,
12/15/31 (1)
319
307
Santander
Consumer
Auto
Receivables
Trust
Series 2020-BA,
Class
C
1.29%,
4/15/26 (1)
100
96
Santander
Consumer
Auto
Receivables
Trust
Series 2021-AA,
Class
D
1.57%,
1/15/27 (1)
100
90
Santander
Consumer
Auto
Receivables
Trust
Series 2021-CA,
Class
C
2.97%,
6/15/28 (1)
300
291
Santander
Retail
Auto
Lease
Trust
Series 2021-C,
Class
D
1.39%,
8/20/26 (1)
350
320
World
Omni
Auto
Receivables
Trust
Series 2020-C,
Class
C
1.39%,
5/17/27
85
79
2,864
Other
Asset-Backed
Securities
9.0%
Amur
Equipment
Finance
Receivables
XI
Series 2022-2A,
Class
A2
5.30%,
6/21/28 (1)
100
99
Applebee's
Funding
Series 2019-1A,
Class
A2I
4.194%,
6/5/49 (1)
248
234
Benefit
Street
Partners
XI
Series 2017-11A,
Class
A2R,
CLO,
FRN
3M
USD
LIBOR
+
1.50%,
5.579%,
4/15/29 (1)
250
241
Blackbird
Capital
Aircraft
Lease
Securitization
Series 2016-1A,
Class
AA,
STEP
2.487%,
12/16/41 (1)
64
59
CBAM
Series 2019-9A,
Class
B1,
CLO,
FRN
3M
USD
LIBOR
+
1.90%,
5.979%,
2/12/30 (1)
250
244
Cedar
Funding
VII
Series 2018-7A,
Class
B,
CLO,
FRN
3M
USD
LIBOR
+
1.40%,
5.643%,
1/20/31 (1)
250
239
DB
Master
Finance
Series 2019-1A,
Class
A2II
4.021%,
5/20/49 (1)
92
85
Elara
HGV
Timeshare
Issuer
Series 2016-A,
Class
A
2.73%,
4/25/28 (1)
11
11
Elara
HGV
Timeshare
Issuer
Series 2019-A,
Class
A
2.61%,
1/25/34 (1)
81
75
T.
ROWE
PRICE
Short
Duration
Income
Fund
17
Par/Shares
$
Value
(Amounts
in
000s)
‡
Hilton
Grand
Vacations
Trust
Series 2017-AA,
Class
B
2.96%,
12/26/28 (1)
69
67
Hilton
Grand
Vacations
Trust
Series 2019-AA,
Class
B
2.54%,
7/25/33 (1)
106
99
KKR
Series 29A,
Class
A,
CLO,
FRN
3M
USD
LIBOR
+
1.20%,
5.279%,
1/15/32 (1)
250
245
Madison
Park
Funding
XXIII
Series 2017-23A,
Class
AR,
CLO,
FRN
3M
USD
LIBOR
+
0.97%,
5.328%,
7/27/31 (1)
250
245
Madison
Park
Funding
XXXVII
Series 2019-37A,
Class
AR,
CLO,
FRN
3M
USD
LIBOR
+
1.07%,
5.149%,
7/15/33 (1)
250
244
MVW
Series 2021-1WA,
Class
C
1.94%,
1/22/41 (1)
71
63
MVW
Owner
Trust
Series 2017-1A,
Class
B
2.75%,
12/20/34 (1)
81
78
OCP
Series 2014-7A,
Class
A1RR,
CLO,
FRN
3M
USD
LIBOR
+
1.12%,
5.363%,
7/20/29 (1)
281
277
OCP
Series 2017-13A,
Class
A2R,
CLO,
FRN
3M
USD
LIBOR
+
1.55%,
5.629%,
7/15/30 (1)
250
241
Octagon
Investment
Partners
Series 2016-1A,
Class
AR,
CLO,
FRN
3M
USD
LIBOR
+
1.18%,
5.505%,
1/24/33 (1)
250
242
Octane
Receivables
Trust
Series 2021-2A,
Class
A
1.21%,
9/20/28 (1)
57
54
Octane
Receivables
Trust
Series 2022-1A,
Class
B
4.90%,
5/22/28 (1)
150
144
Octane
Receivables
Trust
Series 2022-2A,
Class
A
5.11%,
2/22/28 (1)
100
99
Planet
Fitness
Master
Issuer
Series 2018-1A,
Class
A2II
4.666%,
9/5/48 (1)
197
184
Sierra
Timeshare
Receivables
Funding
Series 2021-1A,
Class
B
1.34%,
11/20/37 (1)
120
110
Sierra
Timeshare
Receivables
Funding
Series 2021-1A,
Class
C
1.79%,
11/20/37 (1)
40
37
T.
ROWE
PRICE
Short
Duration
Income
Fund
18
Par/Shares
$
Value
(Amounts
in
000s)
‡
Symphony
Static
I
Series 2021-1A,
Class
C,
CLO,
FRN
3M
USD
LIBOR
+
1.85%,
6.208%,
10/25/29 (1)
250
234
Symphony
XXIII
Series 2020-23A,
Class
AR,
CLO,
FRN
3M
USD
LIBOR
+
1.02%,
5.099%,
1/15/34 (1)
250
244
Verizon
Master
Trust
Series 2021-1,
Class
A
0.50%,
5/20/27
15
14
4,208
Student
Loan
1.1%
Navient
Private
Education
Loan
Trust
Series 2020-A,
Class
A2A
2.46%,
11/15/68 (1)
78
70
Navient
Private
Education
Refi
Loan
Trust
Series 2018-A,
Class
A2
3.19%,
2/18/42 (1)
12
11
Navient
Private
Education
Refi
Loan
Trust
Series 2019-A,
Class
A2A
3.42%,
1/15/43 (1)
50
47
Navient
Private
Education
Refi
Loan
Trust
Series 2019-D,
Class
A2A
3.01%,
12/15/59 (1)
101
92
Navient
Private
Education
Refi
Loan
Trust
Series 2019-GA,
Class
A
2.40%,
10/15/68 (1)
70
64
SMB
Private
Education
Loan
Trust
Series 2016-C,
Class
A2A
2.34%,
9/15/34 (1)
25
24
SMB
Private
Education
Loan
Trust
Series 2017-B,
Class
B
3.50%,
12/16/41 (1)
150
135
SMB
Private
Education
Loan
Trust
Series 2020-A,
Class
A2A
2.23%,
9/15/37 (1)
70
64
507
Total
Asset-Backed
Securities
(Cost
$8,001)
7,579
BANK
LOANS
2.2%
(2)
Consumer
Non-Cyclical
0.9%
PetVet
Care
Centers,
FRN,
1M
USD
LIBOR
+
3.50%,
7.571%,
2/14/25
198
183
Surgery
Center
Holdings,
FRN,
1M
USD
LIBOR
+
3.75%,
7.63%,
8/31/26
251
246
429
T.
ROWE
PRICE
Short
Duration
Income
Fund
19
Par/Shares
$
Value
(Amounts
in
000s)
‡
Insurance
0.9%
Asurion,
FRN,
1M
USD
LIBOR
+
3.00%,
7.071%,
11/3/24
252
241
HUB
International,
FRN,
1M
USD
LIBOR
+
3.00%,
7.327%,
4/25/25
189
185
426
Technology
0.4%
Applied
Systems,
FRN,
1M
USD
LIBOR
+
3.00%,
6.674%,
9/19/24
199
198
198
Total
Bank
Loans
(Cost
$1,085)
1,053
CORPORATE
BONDS
35.5%
Banking
10.5%
Banco
de
Bogota,
6.25%,
5/12/26
200
192
Banco
de
Credito
del
Peru
S.A.,
4.25%,
4/1/23
200
199
Banco
Santander,
2.746%,
5/28/25
200
188
Banco
Santander
Mexico
Institucion
de
Banca
Multiple
Grupo
Financiero
Santand,
5.375%,
4/17/25
150
149
Bank
of
America,
VR,
0.976%,
4/22/25 (3)
350
327
Bank
of
Ireland
Group,
4.50%,
11/25/23 (1)
200
196
Bank
of
Montreal,
Series H,
4.25%,
9/14/24
200
198
Barclays,
VR,
5.304%,
8/9/26 (3)
200
196
Barclays,
VR,
7.325%,
11/2/26 (3)
200
205
BBVA
Bancomer,
4.375%,
4/10/24
150
148
Citigroup,
VR,
0.981%,
5/1/25 (3)
150
140
Citigroup,
VR,
4.14%,
5/24/25 (3)
105
103
Credit
Suisse
Group,
VR,
2.997%,
12/14/23 (1)(3)
250
247
Danske
Bank,
5.375%,
1/12/24 (1)
200
198
Goldman
Sachs
Group,
5.70%,
11/1/24
200
202
Goldman
Sachs
Group,
VR,
1.757%,
1/24/25 (3)
175
166
HSBC
Holdings,
4.25%,
3/14/24
200
196
Lloyds
Banking
Group,
4.50%,
11/4/24
200
194
Mitsubishi
UFJ
Financial
Group,
VR,
5.063%,
9/12/25 (3)
200
198
Morgan
Stanley,
VR,
0.731%,
4/5/24 (3)
210
206
NatWest
Group,
VR,
7.472%,
11/10/26 (3)
200
208
PNC
Financial
Services
Group,
VR,
5.671%,
10/28/25 (3)
135
136
Societe
Generale,
2.625%,
10/16/24 (1)
200
188
UBS
Group,
VR,
4.488%,
5/12/26 (1)(3)
200
195
Wells
Fargo,
VR,
3.908%,
4/25/26 (3)
200
194
Wells
Fargo,
VR,
4.54%,
8/15/26 (3)
150
147
4,916
Basic
Industry
1.9%
ArcelorMittal,
3.60%,
7/16/24
130
126
Celanese
U.S.
Holdings,
6.05%,
3/15/25
155
154
Celulosa
Arauco
y
Constitucion,
4.50%,
8/1/24
200
197
Cia
de
Minas
Buenaventura,
5.50%,
7/23/26 (1)
200
173
T.
ROWE
PRICE
Short
Duration
Income
Fund
20
Par/Shares
$
Value
(Amounts
in
000s)
‡
Suzano
Austria,
5.75%,
7/14/26
200
200
Westlake,
0.875%,
8/15/24
25
23
873
Brokerage
Assetmanagers
Exchanges
0.4%
LSEGA
Financing,
1.375%,
4/6/26 (1)
200
176
176
Communications
2.6%
Axian
Telecom,
7.375%,
2/16/27
200
176
CSC
Holdings,
5.25%,
6/1/24
95
91
Magallanes,
3.428%,
3/15/24 (1)
150
145
Sable
International
Finance,
5.75%,
9/7/27 (1)
200
183
SBA
Tower
Trust,
6.599%,
1/15/28 (1)
115
115
Tower
Bersama
Infrastructure,
4.25%,
1/21/25
200
192
Townsquare
Media,
6.875%,
2/1/26 (1)
165
153
Warnermedia
Holdings,
3.755%,
3/15/27 (1)
155
141
1,196
Consumer
Cyclical
4.6%
7-Eleven,
0.80%,
2/10/24 (1)
45
43
Daimler
Trucks
Finance
North
America,
1.625%,
12/13/24 (1)
170
158
Ford
Motor
Credit,
5.125%,
6/16/25
200
194
General
Motors
Financial,
1.05%,
3/8/24
150
141
Hyatt
Hotels,
1.30%,
10/1/23
60
58
Hyundai
Capital
America,
0.80%,
1/8/24 (1)
150
142
Jaguar
Land
Rover
Automotive,
7.75%,
10/15/25 (1)
200
181
Lowe's,
4.40%,
9/8/25
70
69
Marriott
International,
3.125%,
2/15/23
100
100
Mercedes-Benz
Finance
North
America,
5.375%,
11/26/25 (1)
200
201
Nissan
Motor,
3.043%,
9/15/23 (1)
200
195
Nordstrom,
2.30%,
4/8/24
155
145
QVC,
4.85%,
4/1/24
150
141
Stellantis
Finance
U.S.,
1.711%,
1/29/27 (1)
200
173
Volkswagen
Group
of
America
Finance,
3.95%,
6/6/25 (1)
200
194
2,135
Consumer
Non-Cyclical
3.2%
Brunswick,
0.85%,
8/18/24
115
105
CD&R
Smokey
Buyer,
6.75%,
7/15/25 (1)
175
156
CSL
Finance,
3.85%,
4/27/27 (1)
25
24
HCA,
5.25%,
4/15/25
200
199
Hikma
Finance
USA,
3.25%,
7/9/25
200
185
Kimberly-Clark
de
Mexico,
3.80%,
4/8/24
200
195
Legacy
LifePoint
Health,
6.75%,
4/15/25 (1)
170
155
Mondelez
International
Holdings
Netherlands,
4.25%,
9/15/25 (1)
200
197
Performance
Food
Group,
6.875%,
5/1/25 (1)
95
95
Teva
Pharmaceutical
Finance
Netherlands
III,
6.00%,
4/15/24
200
197
1,508
T.
ROWE
PRICE
Short
Duration
Income
Fund
21
Par/Shares
$
Value
(Amounts
in
000s)
‡
Electric
3.1%
AES,
3.30%,
7/15/25 (1)
100
94
Alexander
Funding
Trust,
1.841%,
11/15/23 (1)
200
188
DTE
Energy,
STEP,
4.22%,
11/1/24
65
64
Enel
Finance
International,
6.80%,
10/14/25 (1)
200
206
Engie
Energia
Chile,
4.50%,
1/29/25
200
192
NRG
Energy,
3.75%,
6/15/24 (1)
150
145
Pacific
Gas
&
Electric,
3.50%,
6/15/25
100
94
Southern,
STEP,
4.475%,
8/1/24
125
123
Vistra
Operations,
3.55%,
7/15/24 (1)
200
191
Vistra
Operations,
5.125%,
5/13/25 (1)
150
147
1,444
Energy
3.0%
Aker
BP,
3.00%,
1/15/25 (1)
150
142
Continental
Resources,
3.80%,
6/1/24
50
49
Continental
Resources,
4.50%,
4/15/23
100
100
Energy
Transfer,
2.90%,
5/15/25
100
94
Energy
Transfer,
4.90%,
2/1/24
60
60
Gray
Oak
Pipeline,
2.00%,
9/15/23 (1)
100
97
Leviathan
Bond,
5.75%,
6/30/23 (1)
200
199
Southwestern
Energy,
8.375%,
9/15/28
175
183
Targa
Resources
Partners,
6.50%,
7/15/27
45
45
Targa
Resources
Partners,
6.875%,
1/15/29
255
260
Thaioil
Treasury
Center,
3.625%,
1/23/23
200
200
1,429
Finance
Companies
1.0%
AerCap
Ireland
Capital,
1.65%,
10/29/24
215
198
Avolon
Holdings
Funding,
3.95%,
7/1/24 (1)
100
95
Navient,
6.125%,
3/25/24
135
135
Navient,
7.25%,
9/25/23
27
27
455
Financial
Other
0.8%
EMG
SUKUK,
4.564%,
6/18/24
200
197
MAF
Global
Securities,
4.75%,
5/7/24
200
197
394
Industrial
Other
0.4%
Bidvest
Group
U.K.,
3.625%,
9/23/26
200
179
179
Insurance
1.4%
Athene
Global
Funding,
1.716%,
1/7/25 (1)
225
209
Brighthouse
Financial
Global
Funding,
1.00%,
4/12/24 (1)
25
23
CNO
Global
Funding,
1.65%,
1/6/25 (1)
150
139
Humana,
1.35%,
2/3/27
70
60
Humana,
5.75%,
3/1/28
25
26
Jackson
Financial,
1.125%,
11/22/23
120
115
T.
ROWE
PRICE
Short
Duration
Income
Fund
22
Par/Shares
$
Value
(Amounts
in
000s)
‡
UnitedHealth
Group,
5.15%,
10/15/25
100
101
673
Owned
No
Guarantee
0.8%
Bank
Negara
Indonesia
Persero,
3.75%,
3/30/26
200
182
Lamar
Funding,
3.958%,
5/7/25
200
190
372
Real
Estate
Investment
Trusts
0.7%
Park
Intermediate
Holdings,
7.50%,
6/1/25 (1)
95
96
Service
Properties
Trust,
7.50%,
9/15/25
175
169
Starwood
Property
Trust,
3.75%,
12/31/24 (1)
50
47
312
Technology
0.8%
CDW,
5.50%,
12/1/24
55
54
Equifax,
5.10%,
12/15/27
95
94
Microchip
Technology,
0.972%,
2/15/24
125
118
Oracle,
5.80%,
11/10/25
45
46
Skyworks
Solutions,
0.90%,
6/1/23
20
20
VMware,
0.60%,
8/15/23
70
68
400
Transportation
0.3%
Sydney
Airport
Finance,
3.90%,
3/22/23 (1)
150
149
149
Total
Corporate
Bonds
(Cost
$17,477)
16,611
FOREIGN
GOVERNMENT
OBLIGATIONS
&
MUNICIPALITIES
2.9%
Government
Sponsored
0.4%
MEGlobal
Canada
ULC,
5.00%,
5/18/25
200
196
196
Owned
No
Guarantee
2.5%
Axiata,
4.357%,
3/24/26
200
196
Ecopetrol,
5.875%,
9/18/23
200
199
Export-Import
Bank
of
India,
3.875%,
3/12/24
200
196
Indian
Oil,
4.75%,
1/16/24 (4)
200
198
Petroleos
Mexicanos,
4.875%,
1/18/24
200
196
QNB
Finance,
2.625%,
5/12/25
200
188
1,173
Total
Foreign
Government
Obligations
&
Municipalities
(Cost
$1,458)
1,369
T.
ROWE
PRICE
Short
Duration
Income
Fund
23
Par/Shares
$
Value
(Amounts
in
000s)
‡
MUNICIPAL
SECURITIES
0.2%
Michigan
0.2%
Detroit,
Social
Bonds,
Series B,
GO,
2.189%,
4/1/24
125
119
Total
Municipal
Securities
(Cost
$125)
119
NON-U.S.
GOVERNMENT
MORTGAGE-BACKED
SECURITIES
15.8%
Collateralized
Mortgage
Obligations
7.3%
Barclays
Mortgage
Loan
Trust
Series 2021-NQM1,
Class
A3,
CMO,
ARM
2.189%,
9/25/51 (1)
75
63
Bellemeade
Re
Series 2022-1,
Class
M1B,
CMO,
ARM
SOFR30A
+
2.15%,
5.671%,
1/26/32 (1)
300
284
CAFL
Issuer
Series 2021-RTL1,
Class
A2,
CMO,
STEP
3.104%,
3/28/29 (1)
220
195
COLT
Mortgage
Loan
Trust
Series 2020-3,
Class
A1,
CMO,
ARM
1.506%,
4/27/65 (1)
20
19
Connecticut
Avenue
Securities
Trust
Series 2021-R01,
Class
1M2,
CMO,
ARM
SOFR30A
+
1.55%,
5.071%,
10/25/41 (1)
200
192
Connecticut
Avenue
Securities
Trust
Series 2022-R03,
Class
1M1,
CMO,
ARM
SOFR30A
+
2.10%,
5.621%,
3/25/42 (1)
118
117
Connecticut
Avenue
Securities
Trust
Series 2022-R06,
Class
1M1,
CMO,
ARM
SOFR30A
+
2.75%,
6.271%,
5/25/42 (1)
79
79
Connecticut
Avenue
Securities
Trust
Series 2022-R08,
Class
1M1,
CMO,
ARM
SOFR30A
+
2.55%,
6.071%,
7/25/42 (1)
66
65
Deephaven
Residential
Mortgage
Trust
Series 2021-1,
Class
A3,
CMO,
ARM
1.128%,
5/25/65 (1)
31
27
Eagle
Series 2021-2,
Class
M1A,
CMO,
ARM
SOFR30A
+
1.55%,
5.097%,
4/25/34 (1)
150
149
Finance
of
America
HECM
Buyout
Series 2022-HB2,
Class
A1A,
CMO,
ARM
4.00%,
12/25/24 (1)
137
134
Flagstar
Mortgage
Trust
Series 2019-1INV,
Class
A11,
CMO,
ARM
1M
USD
LIBOR
+
0.95%,
4.536%,
10/25/49 (1)
19
18
T.
ROWE
PRICE
Short
Duration
Income
Fund
24
Par/Shares
$
Value
(Amounts
in
000s)
‡
Flagstar
Mortgage
Trust
Series 2020-1INV,
Class
A11,
CMO,
ARM
1M
USD
LIBOR
+
0.85%,
4.436%,
3/25/50 (1)
31
29
Freddie
Mac
Whole
Loan
Securities
Trust
Series 2017-SC02,
Class
M1,
CMO,
ARM
3.858%,
5/25/47 (1)
249
242
FWD
Securitization
Trust
Series 2020-INV1,
Class
M1,
CMO,
ARM
2.85%,
1/25/50 (1)
250
192
Hundred
Acre
Wood
Trust
Series 2021-INV1,
Class
A9,
CMO,
ARM
2.50%,
7/25/51 (1)
127
109
Hundred
Acre
Wood
Trust
Series 2021-INV2,
Class
A27,
CMO,
ARM
2.50%,
10/25/51 (1)
88
70
JPMorgan
Mortgage
Trust
Series 2019-INV2,
Class
A3,
CMO,
ARM
3.50%,
2/25/50 (1)
91
83
MFRA
Trust
Series 2021-NQM2,
Class
A3,
CMO,
ARM
1.472%,
11/25/64 (1)
55
42
New
Residential
Mortgage
Loan
Trust
Series 2021-NQ1R,
Class
A3,
CMO,
ARM
1.198%,
7/25/55 (1)
64
51
OBX
Trust
Series 2019-INV1,
Class
A3,
CMO,
ARM
4.50%,
11/25/48 (1)
35
34
OBX
Trust
Series 2019-INV2,
Class
A25,
CMO,
ARM
4.00%,
5/27/49 (1)
49
46
OBX
Trust
Series 2021-NQM3,
Class
A2,
CMO,
ARM
1.26%,
7/25/61 (1)
75
55
Radnor
RE
Series 2021-2,
Class
M1A,
CMO,
ARM
SOFR30A
+
1.85%,
5.397%,
11/25/31 (1)
123
120
Starwood
Mortgage
Residential
Trust
Series 2020-INV1,
Class
A3,
CMO,
ARM
1.593%,
11/25/55 (1)
29
27
Starwood
Mortgage
Residential
Trust
Series 2021-2,
Class
A3,
CMO,
ARM
1.431%,
5/25/65 (1)
92
85
Structured
Agency
Credit
Risk
Debt
Notes
Series 2020-DNA2,
Class
M2,
CMO,
ARM
1M
USD
LIBOR
+
1.85%,
5.866%,
2/25/50 (1)
90
89
Structured
Agency
Credit
Risk
Debt
Notes
Series 2020-DNA5,
Class
M2,
CMO,
ARM
SOFR30A
+
2.80%,
6.321%,
10/25/50 (1)
61
61
T.
ROWE
PRICE
Short
Duration
Income
Fund
25
Par/Shares
$
Value
(Amounts
in
000s)
‡
Structured
Agency
Credit
Risk
Debt
Notes
Series 2020-HQA1,
Class
M2,
CMO,
ARM
1M
USD
LIBOR
+
1.90%,
5.916%,
1/25/50 (1)
25
25
Structured
Agency
Credit
Risk
Debt
Notes
Series 2021-DNA5,
Class
M2,
CMO,
ARM
SOFR30A
+
1.65%,
5.171%,
1/25/34 (1)
83
81
Structured
Agency
Credit
Risk
Debt
Notes
Series 2022-DNA6,
Class
M1A,
CMO,
ARM
SOFR30A
+
2.15%,
5.671%,
9/25/42 (1)
51
51
Structured
Agency
Credit
Risk
Debt
Notes
Series 2022-HQA3,
Class
M1A,
CMO,
ARM
SOFR30A
+
2.30%,
5.821%,
8/25/42 (1)
58
57
Towd
Point
Mortgage
Trust
Series 2016-5,
Class
A1,
CMO,
ARM
2.50%,
10/25/56 (1)
29
29
UWM
Mortgage
Trust
Series 2021-INV2,
Class
A15,
CMO,
ARM
2.50%,
9/25/51 (1)
199
157
Verus
Securitization
Trust
Series 2019-4,
Class
A1,
CMO,
STEP
2.642%,
11/25/59 (1)
10
9
Verus
Securitization
Trust
Series 2019-INV3,
Class
A3,
CMO,
ARM
3.10%,
11/25/59 (1)
129
122
Verus
Securitization
Trust
Series 2020-1,
Class
A3,
CMO,
STEP
2.724%,
1/25/60 (1)
89
84
Verus
Securitization
Trust
Series 2021-2,
Class
A3,
CMO,
ARM
1.545%,
2/25/66 (1)
170
138
3,430
Commercial
Mortgage-Backed
Securities
8.5%
Alen
Mortgage
Trust
Series 2021-ACEN,
Class
C,
ARM
1M
USD
LIBOR
+
2.25%,
6.125%,
4/15/34 (1)
100
89
Arbor
Realty
Commercial
Real
Estate
Notes
Series 2021-FL3,
Class
A,
ARM
1M
USD
LIBOR
+
1.07%,
4.945%,
8/15/34 (1)
100
96
Arbor
Realty
Commercial
Real
Estate
Notes
Series 2021-FL4,
Class
A,
ARM
1M
USD
LIBOR
+
1.35%,
5.225%,
11/15/36 (1)
115
111
BAMLL
Commercial
Mortgage
Securities
Trust
Series 2021-JACX,
Class
E,
ARM
1M
USD
LIBOR
+
3.75%,
7.625%,
9/15/38 (1)
100
89
BANK
Series 2019-BN23,
Class
A1
1.975%,
12/15/52
39
37
T.
ROWE
PRICE
Short
Duration
Income
Fund
26
Par/Shares
$
Value
(Amounts
in
000s)
‡
BBCMS
Mortgage
Trust
Series 2020-BID,
Class
A,
ARM
1M
USD
LIBOR
+
2.14%,
6.015%,
10/15/37 (1)
250
242
BSPRT
Issuer
Series 2022-FL8,
Class
A,
ARM
SOFR30A
+
1.50%,
4.718%,
2/15/37 (1)
200
192
BX
Commercial
Mortgage
Trust
Series 2019-IMC,
Class
A,
ARM
1M
USD
LIBOR
+
1.00%,
4.873%,
4/15/34 (1)
160
156
BX
Commercial
Mortgage
Trust
Series 2019-IMC,
Class
D,
ARM
1M
USD
LIBOR
+
1.90%,
5.773%,
4/15/34 (1)
202
188
BX
Trust
Series 2021-ARIA,
Class
C,
ARM
1M
USD
LIBOR
+
1.646%,
5.521%,
10/15/36 (1)
160
148
CD
Mortgage
Trust
Series 2016-CD1,
Class
B,
ARM
3.077%,
8/10/49
100
86
Citigroup
Commercial
Mortgage
Trust
Series 2013-375P,
Class
B,
ARM
3.635%,
5/10/35 (1)
150
140
Citigroup
Commercial
Mortgage
Trust
Series 2016-C1,
Class
AS
3.514%,
5/10/49
200
183
Cold
Storage
Trust
Series 2020-ICE5,
Class
C,
ARM
1M
USD
LIBOR
+
1.65%,
5.525%,
11/15/37 (1)
147
142
Commercial
Mortgage
Trust
Series 2013-300P,
Class
A1
4.353%,
8/10/30 (1)
146
142
Commercial
Mortgage
Trust
Series 2014-CR14,
Class
AM,
ARM
4.526%,
2/10/47
75
73
Commercial
Mortgage
Trust
Series 2014-UBS2,
Class
B
4.701%,
3/10/47
105
101
Commercial
Mortgage
Trust
Series 2017-PANW,
Class
D,
ARM
4.343%,
10/10/29 (1)
109
99
Eleven
Madison
Mortgage
Trust
Series 2015-11MD,
Class
A,
ARM
3.673%,
9/10/35 (1)
170
157
Fontainebleau
Miami
Beach
Trust
Series 2019-FBLU,
Class
B
3.447%,
12/10/36 (1)
275
256
Great
Wolf
Trust
Series 2019-WOLF,
Class
E,
ARM
1M
USD
LIBOR
+
2.732%,
6.607%,
12/15/36 (1)
125
118
T.
ROWE
PRICE
Short
Duration
Income
Fund
27
Par/Shares
$
Value
(Amounts
in
000s)
‡
GS
Mortgage
Securities
Trust
Series 2021-ROSS,
Class
C,
ARM
1M
USD
LIBOR
+
2.00%,
5.876%,
5/15/26 (1)
105
93
JPMorgan
Chase
Commercial
Mortgage
Securities
Trust
Series 2018-WPT,
Class
BFL,
ARM
1M
USD
LIBOR
+
1.50%,
5.347%,
7/5/33 (1)
59
54
JPMorgan
Chase
Commercial
Mortgage
Securities
Trust
Series 2020-609M,
Class
B,
ARM
1M
USD
LIBOR
+
1.77%,
5.646%,
10/15/33 (1)
100
94
LSTAR
Commercial
Mortgage
Trust
Series 2015-3,
Class
B,
ARM
3.291%,
4/20/48 (1)
147
137
MF1
Series 2021-FL7,
Class
A,
ARM
1M
USD
LIBOR
+
1.08%,
5.019%,
10/16/36 (1)
115
110
Morgan
Stanley
Bank
of
America
Merrill
Lynch
Trust
Series 2013-C7,
Class
AS
3.214%,
2/15/46
90
90
Morgan
Stanley
Bank
of
America
Merrill
Lynch
Trust
Series 2014-C17,
Class
A5
3.741%,
8/15/47
39
38
Morgan
Stanley
Bank
of
America
Merrill
Lynch
Trust
Series 2015-C24,
Class
AS,
ARM
4.036%,
5/15/48
95
89
One
Market
Plaza
Trust
Series 2017-1MKT,
Class
A
3.614%,
2/10/32 (1)
130
125
Shelter
Growth
CRE
Issuer
Series 2021-FL3,
Class
A,
ARM
1M
USD
LIBOR
+
1.08%,
4.955%,
9/15/36 (1)
67
65
SLIDE
Series 2018-FUN,
Class
D,
ARM
1M
USD
LIBOR
+
2.10%,
5.975%,
6/15/31 (1)
228
221
3,961
Total
Non-U.S.
Government
Mortgage-Backed
Securities
(Cost
$8,051)
7,391
U.S.
GOVERNMENT
&
AGENCY
MORTGAGE-BACKED
SECURITIES
1.5%
U.S
Government
Obligation
1.5%
Government
National
Mortgage
Assn.
3.50%,
5/20/47
-
11/20/47
495
466
4.50%,
6/20/51
234
232
Total
U.S.
Government
&
Agency
Mortgage-Backed
Securities
(Cost
$679)
698
T.
ROWE
PRICE
Short
Duration
Income
Fund
28
Par/Shares
$
Value
(Amounts
in
000s)
‡
U.S.
GOVERNMENT
AGENCY
OBLIGATIONS
(EXCLUDING
MORTGAGE-BACKED)
20.5%
U.S.
Treasury
Obligations
20.5%
U.S.
Treasury
Notes,
2.50%,
4/30/24
735
714
U.S.
Treasury
Notes,
3.00%,
6/30/24
1,000
976
U.S.
Treasury
Notes,
3.00%,
7/31/24
2,165
2,113
U.S.
Treasury
Notes,
3.00%,
7/15/25 (5)
3,225
3,132
U.S.
Treasury
Notes,
4.25%,
9/30/24
1,930
1,924
U.S.
Treasury
Notes,
4.375%,
10/31/24
760
760
Total
U.S.
Government
Agency
Obligations
(Excluding
Mortgage-Backed)
(Cost
$9,808)
9,619
SHORT-TERM
INVESTMENTS
5.3%
Commercial
Paper
3.8%
4(2)
2.7%(6)
Crown
Castle
International,
5.085%,
1/17/23
250
248
Enel
Finance
America,
3.299%,
1/3/23
250
249
Harley
Davidson,
4.66%,
12/5/22
250
250
International
Flavors
&
Fragrances,
2.10%,
12/21/22
250
249
Targa
Resources,
4.868%,
12/16/22
250
250
1,246
Non-4(2)
1.1%
Ovintiv,
4.863%,
12/19/22
250
250
Quanta
Services,
4.712%,
12/6/22
250
250
500
1,746
Money
Market
Funds
1.5%
T.
Rowe
Price
Government
Reserve
Fund,
3.86% (7)(8)
720
720
720
Total
Short-Term
Investments
(Cost
$2,465)
2,466
T.
ROWE
PRICE
Short
Duration
Income
Fund
29
Par/Shares
$
Value
(Amounts
in
000s)
‡
SECURITIES
LENDING
COLLATERAL
0.4%
INVESTMENTS
IN
A
POOLED
ACCOUNT
THROUGH
SECURITIES
LENDING
PROGRAM
WITH
JPMORGAN
CHASE
BANK
0.4%
Money
Market
Funds
0.4%
T.
Rowe
Price
Government
Reserve
Fund,
3.86% (7)(8)
185
185
Total
Investments
in
a
Pooled
Account
through
Securities
Lending
Program
with
JPMorgan
Chase
Bank
185
Total
Securities
Lending
Collateral
(Cost
$185)
185
Total
Investments
in
Securities
100.5%
of
Net
Assets
(Cost
$49,334)
$
47,090
‡
Par/Shares
and
Notional
Amount
are
denominated
in
U.S.
dollars
unless
otherwise
noted.
(1)
Security
was
purchased
pursuant
to
Rule
144A
under
the
Securities
Act
of
1933
and
may
be
resold
in
transactions
exempt
from
registration
only
to
qualified
institutional
buyers.
Total
value
of
such
securities
at
period-end
amounts
to
$18,907
and
represents
40.4%
of
net
assets.
(2)
Bank
loan
positions
may
involve
multiple
underlying
tranches.
In
those
instances,
the
position
presented
reflects
the
aggregate
of
those
respective
underlying
tranches
and
the
rate
presented
reflects
the
weighted
average
rate
of
the
settled
positions.
(3)
Security
is
a
fix-to-float
security,
which
carries
a
fixed
coupon
until
a
certain
date,
upon
which
it
switches
to
a
floating
rate.
Reference
rate
and
spread
are
provided
if
the
rate
is
currently
floating.
(4)
See
Note
4
.
All
or
a
portion
of
this
security
is
on
loan
at
November
30,
2022.
(5)
At
November
30,
2022,
all
or
a
portion
of
this
security
is
pledged
as
collateral
and/or
margin
deposit
to
cover
future
funding
obligations.
(6)
Commercial
paper
exempt
from
registration
under
Section
4(2)
of
the
Securities
Act
of
1933
and
may
be
resold
in
transactions
exempt
from
registration
only
to
dealers
in
that
program
or
other
"accredited
investors".
Total
value
of
such
securities
at
period-end
amounts
to
$1,246
and
represents
2.7%
of
net
assets.
(7)
Seven-day
yield
(8)
Affiliated
Companies
1M
USD
LIBOR
One
month
USD
LIBOR
(London
interbank
offered
rate)
3M
USD
LIBOR
Three
month
USD
LIBOR
(London
interbank
offered
rate)
ARM
Adjustable
Rate
Mortgage
(ARM);
rate
shown
is
effective
rate
at
period-end.
The
rates
for
certain
ARMs
are
not
based
on
a
published
reference
rate
and
spread
but
may
be
determined
using
a
formula
based
on
the
rates
of
the
underlying
loans.
T.
ROWE
PRICE
Short
Duration
Income
Fund
30
.
.
.
.
.
.
.
.
.
.
CLO
Collateralized
Loan
Obligation
CMO
Collateralized
Mortgage
Obligation
FRN
Floating
Rate
Note
GO
General
Obligation
SOFR30A
30-day
Average
SOFR
(Secured
overnight
financing
rate)
STEP
Stepped
coupon
bond
for
which
the
coupon
rate
of
interest
adjusts
on
specified
date(s);
rate
shown
is
effective
rate
at
period-end.
VR
Variable
Rate;
rate
shown
is
effective
rate
at
period-end.
The
rates
for
certain
variable
rate
securities
are
not
based
on
a
published
reference
rate
and
spread
but
are
determined
by
the
issuer
or
agent
and
based
on
current
market
conditions.
T.
ROWE
PRICE
Short
Duration
Income
Fund
31
(Amounts
in
000s)
SWAPS
0.2%
Description
Notional
Amount
$
Value
Upfront
Payments/
$
(Receipts)
Unrealized
$
Gain/(Loss)
BILATERAL
SWAPS
0.2%
Credit
Default
Swaps,
Protection
Bought
0.2%
Goldman
Sachs,
Protection
Bought
(Relevant
Credit:
Markit
CMBX.
NA.BBB-S10,
40
Year
Index),
Pay
3.00%
Monthly,
Receive
upon
credit
default,
12/16/72
585
111
120
(9)
Total
Bilateral
Credit
Default
Swaps,
Protection
Bought
120
(9)
Credit
Default
Swaps,
Protection
Sold
0.0%
Barclays
Bank,
Protection
Sold
(Relevant
Credit:
AT&T,
Baa2*),
Receive
1.00%
Quarterly,
Pay
upon
credit
default,
6/20/23
250
1
1
—
Total
Bilateral
Credit
Default
Swaps,
Protection
Sold
1
—
Total
Bilateral
Swaps
121
(9)
Description
Notional
Amount
$
Value
Initial
$
Value
**
Unrealized
$
Gain/(Loss)
CENTRALLY
CLEARED
SWAPS
(0.0)%
Credit
Default
Swaps,
Protection
Bought
(0.0)%
Protection
Bought
(Relevant
Credit:
Markit
CDX.NA.HY-S39,
5
Year
Index),
Pay
5.00%
Quarterly,
Receive
upon
credit
default,
12/20/27
480
(14)
(12)
(2)
Total
Centrally
Cleared
Credit
Default
Swaps,
Protection
Bought
(2)
T.
ROWE
PRICE
Short
Duration
Income
Fund
32
(Amounts
in
000s)
Description
Notional
Amount
$
Value
Initial
$
Value**
Unrealized
$
Gain/(Loss)
Credit
Default
Swaps,
Protection
Sold
0.0%
Protection
Sold
(Relevant
Credit:
Markit
CDX.NA.IG-S39,
5
Year
Index),
Receive
1.00%
Quarterly,
Pay
upon
credit
default,
12/20/27
690
9
7
2
Total
Centrally
Cleared
Credit
Default
Swaps,
Protection
Sold
2
Total
Centrally
Cleared
Swaps
—
Net
payments
(receipts)
of
variation
margin
to
date
(4)
Variation
margin
receivable
(payable)
on
centrally
cleared
swaps
$
(4)
*
Credit
ratings
as
of
November
30,
2022.
Ratings
shown
are
from
Moody’s
Investors
Service
and
if
Moody’s
does
not
rate
a
security,
then
Standard
&
Poor’s
(S&P)
is
used.
Fitch
is
used
for
securities
that
are
not
rated
by
either
Moody’s
or
S&P.
**
Includes
interest
purchased
or
sold
but
not
yet
collected
of
$(3).
T.
ROWE
PRICE
Short
Duration
Income
Fund
33
FUTURES
CONTRACTS
($000s)
Expiration
Date
Notional
Amount
Value
and
Unrealized
Gain
(Loss)
Short,
5
U.S.
Treasury
Notes
five
year
contracts
3/23
(543)
$
(3)
Short,
4
U.S.
Treasury
Notes
ten
year
contracts
3/23
(454)
(4)
Long,
48
U.S.
Treasury
Notes
two
year
contracts
3/23
9,857
26
Short,
1
U.S.
Ultra
Treasury
Notes
ten
year
contracts
3/23
(120)
(1)
Net
payments
(receipts)
of
variation
margin
to
date
(3)
Variation
margin
receivable
(payable)
on
open
futures
contracts
$
15
T.
ROWE
PRICE
Short
Duration
Income
Fund
34
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
AFFILIATED
COMPANIES
($000s)
The
fund
may
invest
in
certain
securities
that
are
considered
affiliated
companies.
As
defined
by
the
1940
Act,
an
affiliated
company
is
one
in
which
the
fund
owns
5%
or
more
of
the
outstanding
voting
securities,
or
a
company
that
is
under
common
ownership
or
control.
The
following
securities
were
considered
affiliated
companies
for
all
or
some
portion
of
the
six
months
ended
November
30,
2022.
Net
realized
gain
(loss),
investment
income,
change
in
net
unrealized
gain/loss,
and
purchase
and
sales
cost
reflect
all
activity
for
the
period
then
ended.
Affiliate
Net
Realized
Gain
(Loss)
Change
in
Net
Unrealized
Gain/Loss
Investment
Income
T.
Rowe
Price
Government
Reserve
Fund,
3.86%
$
—
$
—
$
12++
Totals
$
—#
$
—
$
12+
Supplementary
Investment
Schedule
Affiliate
Value
05/31/22
Purchase
Cost
Sales
Cost
Value
11/30/22
T.
Rowe
Price
Government
Reserve
Fund,
3.86%
$
942
¤
¤
$
905
Total
$
905^
#
Capital
gain
distributions
from
underlying
Price
funds
represented
$0
of
the
net
realized
gain
(loss).
++
Excludes
earnings
on
securities
lending
collateral,
which
are
subject
to
rebates
and
fees
as
described
in
Note
4
.
+
Investment
income
comprised
$12
of
dividend
income
and
$0
of
interest
income.
¤
Purchase
and
sale
information
not
shown
for
cash
management
funds.
^
The
cost
basis
of
investments
in
affiliated
companies
was
$905.
T.
ROWE
PRICE
Short
Duration
Income
Fund
November
30,
2022
(Unaudited)
Statement
of
Assets
and
Liabilities
35
($000s,
except
shares
and
per
share
amounts)
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Assets
Investments
in
securities,
at
value
(cost
$49,334)
$
47,090
Interest
receivable
321
Cash
236
Bilateral
swap
premiums
paid
121
Receivable
for
shares
sold
59
Due
from
affiliates
16
Variation
margin
receivable
on
futures
contracts
15
Other
assets
45
Total
assets
47,903
Liabilities
Payable
for
investment
securities
purchased
638
Obligation
to
return
securities
lending
collateral
185
Investment
management
fees
payable
11
Unrealized
loss
on
bilateral
swaps
9
Variation
margin
payable
on
centrally
cleared
swaps
4
Payable
for
shares
redeemed
3
Other
liabilities
210
Total
liabilities
1,060
NET
ASSETS
$
46,843
T.
ROWE
PRICE
Short
Duration
Income
Fund
November
30,
2022
(Unaudited)
Statement
of
Assets
and
Liabilities
36
($000s,
except
shares
and
per
share
amounts)
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
Net
Assets
Consist
of:
Total
distributable
earnings
(loss)
$
(4,416)
Paid-in
capital
applicable
to
5,102,779
shares
of
$0.01
par
value
capital
stock
outstanding;
6,000,000,000
shares
authorized
51,259
NET
ASSETS
$
46,843
NET
ASSET
VALUE
PER
SHARE
Investor
Class
($29,197,966
/
3,180,242
shares
outstanding)
$
9.18
I
Class
($17,644,953
/
1,922,537
shares
outstanding)
$
9.18
T.
ROWE
PRICE
Short
Duration
Income
Fund
(Unaudited)
Statement
of
Operations
37
($000s)
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
6
Months
Ended
11/30/22
Investment
Income
(Loss)
Income
Interest
$
736
Dividend
12
Total
income
748
Expenses
Investment
management
68
Shareholder
servicing
Investor
Class
$
13
I
Class
4
17
Prospectus
and
shareholder
reports
Investor
Class
12
I
Class
2
14
Custody
and
accounting
94
Registration
26
Legal
and
audit
19
Miscellaneous
7
Waived
/
paid
by
Price
Associates
(159)
Total
expenses
86
Net
investment
income
662
T.
ROWE
PRICE
Short
Duration
Income
Fund
(Unaudited)
Statement
of
Operations
38
($000s)
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
6
Months
Ended
11/30/22
Realized
and
Unrealized
Gain
/
Loss
–
Net
realized
gain
(loss)
Securities
(901)
Futures
(349)
Swaps
(51)
Net
realized
loss
(1,301)
Change
in
net
unrealized
gain
/
loss
Securities
(407)
Futures
26
Swaps
(9)
Change
in
net
unrealized
gain
/
loss
(390)
Net
realized
and
unrealized
gain
/
loss
(1,691)
DECREASE
IN
NET
ASSETS
FROM
OPERATIONS
$
(1,029)
T.
ROWE
PRICE
Short
Duration
Income
Fund
(Unaudited)
Statement
of
Changes
in
Net
Assets
39
($000s)
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
6
Months
Ended
11/30/22
Year
Ended
5/31/22
Increase
(Decrease)
in
Net
Assets
Operations
Net
investment
income
$
662
$
901
Net
realized
loss
(1,301)
(897)
Change
in
net
unrealized
gain
/
loss
(390)
(1,949)
Decrease
in
net
assets
from
operations
(1,029)
(1,945)
Distributions
to
shareholders
Net
earnings
Investor
Class
(409)
(824)
I
Class
(240)
(120)
Decrease
in
net
assets
from
distributions
(649)
(944)
Capital
share
transactions
*
Shares
sold
Investor
Class
4,384
27,835
I
Class
5,350
23,019
Distributions
reinvested
Investor
Class
154
419
I
Class
197
99
Shares
redeemed
Investor
Class
(5,364)
(37,684)
I
Class
(4,550)
(5,612)
Increase
in
net
assets
from
capital
share
transactions
171
8,076
T.
ROWE
PRICE
Short
Duration
Income
Fund
(Unaudited)
Statement
of
Changes
in
Net
Assets
40
($000s)
The
accompanying
notes
are
an
integral
part
of
these
financial
statements.
6
Months
Ended
11/30/22
Year
Ended
5/31/22
Net
Assets
Increase
(decrease)
during
period
(1,507)
5,187
Beginning
of
period
48,350
43,163
End
of
period
$
46,843
$
48,350
*Share
information
(000s)
Shares
sold
Investor
Class
472
2,797
I
Class
579
2,362
Distributions
reinvested
Investor
Class
17
42
I
Class
21
10
Shares
redeemed
Investor
Class
(579)
(3,837)
I
Class
(491)
(583)
Increase
in
shares
outstanding
19
791
T.
ROWE
PRICE
Short
Duration
Income
Fund
Unaudited
NOTES
TO
FINANCIAL
STATEMENTS
41
T.
Rowe
Price
Short-Term
Bond
Fund,
Inc.
(the
corporation) is
registered
under
the
Investment
Company
Act
of
1940
(the
1940
Act).
The
Short
Duration
Income
Fund
(the
fund)
is a
diversified,
open-end
management
investment
company
established
by
the
corporation. The
fund
seeks
to
provide
income
consistent
with
limited
fluctuation
in
principal
value
and
liquidity.
The
fund
has
two classes
of
shares:
the
Short
Duration
Income
Fund
(Investor
Class)
and
the
Short
Duration
Income
Fund–I
Class
(I
Class).
I
Class
shares
require
a
$500,000
initial
investment
minimum,
although
the
minimum
generally
is
waived
or
reduced
for
financial
intermediaries,
eligible
retirement
plans,
and
certain
other
accounts.
Prior
to
November
15,
2021,
the
initial
investment
minimum
was
$1
million
and
was
generally
waived
for
financial
intermediaries,
eligible
retirement
plans,
and
other
certain
accounts.
As
a
result
of
the
reduction
in
the
I
Class
minimum,
certain
assets
transferred
from
the
Investor
Class
to
the
I
Class.
This
transfer
of
shares
from
Investor
Class
to
I
Class
is
reflected
in
the
Statement
of
Changes
in
Net
Assets
within
the
Capital
shares
transactions
as
Shares
redeemed
and
Shares
sold,
respectively. Each
class
has
exclusive
voting
rights
on
matters
related
solely
to
that
class;
separate
voting
rights
on
matters
that
relate
to
both
classes;
and,
in
all
other
respects,
the
same
rights
and
obligations
as
the
other
class.
NOTE
1
-
SIGNIFICANT
ACCOUNTING
POLICIES
Basis
of
Preparation
The fund
is
an
investment
company
and
follows
accounting
and
reporting
guidance
in
the
Financial
Accounting
Standards
Board
(FASB)
Accounting
Standards
Codification
Topic
946
(ASC
946).
The
accompanying
financial
statements
were
prepared
in
accordance
with
accounting
principles
generally
accepted
in
the
United
States
of
America
(GAAP),
including,
but
not
limited
to,
ASC
946.
GAAP
requires
the
use
of
estimates
made
by
management.
Management
believes
that
estimates
and
valuations
are
appropriate;
however,
actual
results
may
differ
from
those
estimates,
and
the
valuations
reflected
in
the
accompanying
financial
statements
may
differ
from
the
value
ultimately
realized
upon
sale
or
maturity.
Investment
Transactions,
Investment
Income,
and
Distributions
Investment
transactions
are
accounted
for
on
the
trade
date
basis.
Income
and
expenses
are
recorded
on
the
accrual
basis.
Realized
gains
and
losses
are
reported
on
the
identified
cost
basis.
Premiums
and
discounts
on
debt
securities
are
amortized
for
financial
reporting
purposes.
Paydown
gains
and
losses
are
recorded
as
an
adjustment
to
interest
income.
Inflation
adjustments
to
the
principal
amount
of
inflation-indexed
bonds
are
reflected
as
interest
income.
Income
tax-related
interest
and
penalties,
if
incurred,
are
T.
ROWE
PRICE
Short
Duration
Income
Fund
42
recorded
as
income
tax
expense.
Dividends
received
from
mutual
fund
investments
are
reflected
as
dividend
income;
capital
gain
distributions
are
reflected
as
realized
gain/
loss.
Dividend
income
and
capital
gain
distributions
are
recorded
on
the
ex-dividend
date.
Non-cash
dividends,
if
any,
are
recorded
at
the
fair
market
value
of
the
asset
received.
Distributions
to
shareholders
are
recorded
on
the
ex-dividend
date.
Income
distributions,
if
any, are
declared
by
each
class daily
and
paid
monthly.
A
capital
gain
distribution,
if
any, may
also
be
declared
and
paid
by
the
fund
annually.
Class
Accounting
Shareholder
servicing,
prospectus,
and
shareholder
report
expenses
incurred
by
each
class
are
charged
directly
to
the
class
to
which
they
relate.
Expenses
common
to all classes
and
investment
income
are
allocated
to
the
classes
based
upon
the
relative
daily
net
assets
of
each
class’s
settled
shares;
realized
and
unrealized
gains
and
losses
are
allocated
based
upon
the
relative
daily
net
assets
of
each
class’s
outstanding
shares.
Capital
Transactions
Each
investor’s
interest
in
the
net
assets
of the
fund
is
represented
by
fund
shares. The
fund’s
net
asset
value
(NAV)
per
share
is
computed
at
the
close
of
the
New
York
Stock
Exchange
(NYSE),
normally
4
p.m.
ET,
each
day
the
NYSE
is
open
for
business.
However,
the
NAV
per
share
may
be
calculated
at
a
time
other
than
the
normal
close
of
the
NYSE
if
trading
on
the
NYSE
is
restricted,
if
the
NYSE
closes
earlier,
or
as
may
be
permitted
by
the
SEC.
Purchases
and
redemptions
of
fund
shares
are
transacted
at
the
next-computed
NAV
per
share,
after
receipt
of
the
transaction
order
by
T.
Rowe
Price
Associates,
Inc.,
or
its
agents.
New
Accounting
Guidance
The
FASB
issued
Accounting
Standards
Update
(ASU),
ASU
2020–04,
Reference
Rate
Reform
(Topic
848) –
Facilitation
of
the
Effects
of
Reference
Rate
Reform
on
Financial
Reporting
in
March
2020
and
ASU
2021-01
in
January
2021
which
provided
further
amendments
and
clarifications
to
Topic
848.
These
ASUs provide
optional,
temporary
relief
with
respect
to
the
financial
reporting
of
contracts
subject
to
certain
types
of
modifications
due
to
the
planned
discontinuation
of
the
London
Interbank
Offered
Rate
(LIBOR),
and
other
interbank-offered
based
reference
rates,
through December
31,
2022.
Management
intends
to
rely
upon
the
relief
provided
under
Topic
848,
which
is
not
expected to
have
a
material
impact
on
the fund's
financial statements.
Indemnification
In
the
normal
course
of
business, the
fund
may
provide
indemnification
in
connection
with
its
officers
and
directors,
service
providers,
and/or
private
company
investments. The
fund’s
maximum
exposure
under
these
arrangements
is
unknown;
however,
the
risk
of
material
loss
is
currently
considered
to
be
remote.
T.
ROWE
PRICE
Short
Duration
Income
Fund
43
NOTE
2
-
VALUATION
Fair
Value
The
fund’s
financial
instruments
are
valued
at
the
close
of
the
NYSE
and
are
reported
at
fair
value,
which
GAAP
defines
as
the
price
that
would
be
received
to
sell
an
asset
or
paid
to
transfer
a
liability
in
an
orderly
transaction
between
market
participants
at
the
measurement
date. The fund’s
Board
of
Directors
(the
Board)
has
designated
T.
Rowe
Price
Associates,
Inc.
as
the
fund’s
valuation
designee
(Valuation
Designee).
Subject
to
oversight
by
the
Board,
the
Valuation
Designee
performs
the
following
functions
in
performing
fair
value
determinations:
assesses
and
manages
valuation
risks;
establishes
and
applies
fair
value
methodologies;
tests
fair
value
methodologies;
and
evaluates
pricing
vendors
and
pricing
agents.
The
duties
and
responsibilities
of
the
Valuation
Designee
are
performed
by
its
Valuation
Committee. The
Valuation
Designee provides
periodic
reporting
to
the
Board
on
valuation
matters.
Various
valuation
techniques
and
inputs
are
used
to
determine
the
fair
value
of
financial
instruments.
GAAP
establishes
the
following
fair
value
hierarchy
that
categorizes
the
inputs
used
to
measure
fair
value:
Level
1
–
quoted
prices
(unadjusted)
in
active
markets
for
identical
financial
instruments
that
the
fund
can
access
at
the
reporting
date
Level
2
–
inputs
other
than
Level
1
quoted
prices
that
are
observable,
either
directly
or
indirectly
(including,
but
not
limited
to,
quoted
prices
for
similar
financial
instruments
in
active
markets,
quoted
prices
for
identical
or
similar
financial
instruments
in
inactive
markets,
interest
rates
and
yield
curves,
implied
volatilities,
and
credit
spreads)
Level
3
–
unobservable
inputs
(including
the Valuation
Designee’s assumptions
in
determining
fair
value)
Observable
inputs
are
developed
using
market
data,
such
as
publicly
available
information
about
actual
events
or
transactions,
and
reflect
the
assumptions
that
market
participants
would
use
to
price
the
financial
instrument.
Unobservable
inputs
are
those
for
which
market
data
are
not
available
and
are
developed
using
the
best
information
available
about
the
assumptions
that
market
participants
would
use
to
price
the
financial
instrument.
GAAP
requires
valuation
techniques
to
maximize
the
use
of
relevant
observable
inputs
and
minimize
the
use
of
unobservable
inputs.
When
multiple
inputs
are
used
to
derive
fair
value,
the
financial
instrument
is
assigned
to
the
level
within
the
fair
value
hierarchy
based
on
the
lowest-level
input
that
is
significant
to
the
fair
value
of
the
financial
instrument.
Input
levels
are
not
necessarily
an
indication
of
the
risk
or
liquidity
associated
with
financial
instruments
at
that
level
but
rather
the
degree
of
judgment
used
in
determining
those
values.
T.
ROWE
PRICE
Short
Duration
Income
Fund
44
Valuation
Techniques
Debt
securities
generally
are
traded
in
the over-the-counter
(OTC)
market
and
are
valued
at
prices
furnished
by
independent
pricing
services
or
by
broker
dealers
who
make
markets
in
such
securities.
When
valuing
securities,
the
independent
pricing
services
consider
the
yield
or
price
of
bonds
of
comparable
quality,
coupon,
maturity,
and
type,
as
well
as
prices
quoted
by
dealers
who
make
markets
in
such
securities.
Investments
in
mutual
funds
are
valued
at
the
mutual
fund’s
closing
NAV
per
share
on
the
day
of
valuation.
Futures
contracts
are
valued
at
closing
settlement
prices.
Swaps
are
valued
at
prices
furnished
by
an
independent
pricing
service
or
independent
swap
dealers.
Assets
and
liabilities
other
than
financial
instruments,
including
short-term
receivables
and
payables,
are
carried
at
cost,
or
estimated
realizable
value,
if
less,
which
approximates
fair
value.
Investments
for
which
market
quotations are
not
readily
available
or
deemed
unreliable
are
valued
at
fair
value
as
determined
in
good
faith
by
the
Valuation
Designee.
The
Valuation
Designee
has
adopted
methodologies
for
determining
the
fair
value
of
investments
for
which
market
quotations
are
not
readily
available
or
deemed
unreliable,
including
the
use
of
other
pricing
sources.
Factors
used
in
determining
fair
value
vary
by
type
of
investment
and
may
include
market
or
investment
specific
considerations.
The
Valuation
Designee typically
will
afford
greatest
weight
to
actual
prices
in
arm’s
length
transactions,
to
the
extent
they
represent
orderly
transactions
between
market
participants,
transaction
information
can
be
reliably
obtained,
and
prices
are
deemed
representative
of
fair
value.
However,
the
Valuation
Designee may
also
consider
other
valuation
methods
such
as
market-based
valuation
multiples;
a
discount
or
premium
from
market
value
of
a
similar,
freely
traded
security
of
the
same
issuer;
discounted
cash
flows;
yield
to
maturity;
or
some
combination.
Fair
value
determinations
are
reviewed
on
a
regular
basis.
Because
any
fair
value
determination
involves
a
significant
amount
of
judgment,
there
is
a
degree
of
subjectivity
inherent
in
such
pricing
decisions. Fair
value
prices
determined
by
the
Valuation
Designee could
differ
from
those
of
other
market
participants,
and
it
is
possible
that
the
fair
value
determined
for
a
security
may
be
materially
different
from
the
value
that
could
be
realized
upon
the
sale
of
that
security.
T.
ROWE
PRICE
Short
Duration
Income
Fund
45
Valuation
Inputs
The
following
table
summarizes
the
fund’s
financial
instruments,
based
on
the
inputs
used
to
determine
their
fair
values
on
November
30,
2022
(for
further
detail
by
category,
please
refer
to
the
accompanying
Portfolio
of
Investments):
NOTE
3
-
DERIVATIVE
INSTRUMENTS
During
the
six
months ended
November
30,
2022,
the
fund
invested
in
derivative
instruments.
As
defined
by
GAAP,
a
derivative
is
a
financial
instrument
whose
value
is
derived
from
an
underlying
security
price,
foreign
exchange
rate,
interest
rate,
index
of
prices
or
rates,
or
other
variable;
it
requires
little
or
no
initial
investment
and
permits
or
requires
net
settlement.
The
fund
invests
in
derivatives
only
if
the
expected
risks
and
rewards
are
consistent
with
its
investment
objectives,
policies,
and
overall
risk
profile,
as
described
in
its
prospectus
and
Statement
of
Additional
Information.
The
fund
may
($000s)
Level
1
Level
2
Level
3
Total
Value
Assets
Fixed
Income
Securities
1
$
—
$
44,439
$
—
$
44,439
Short-Term
Investments
720
1,746
—
2,466
Securities
Lending
Collateral
185
—
—
185
Total
Securities
905
46,185
—
47,090
Swaps*
—
114
—
114
Futures
Contracts*
26
—
—
26
Total
$
931
$
46,299
$
—
$
47,230
Liabilities
Swaps*
$
—
$
2
$
—
$
2
Futures
Contracts*
8
—
—
8
Total
$
8
$
2
$
—
$
10
1
Includes
Asset-Backed
Securities,
Bank
Loans,
Corporate
Bonds,
Foreign
Government
Obligations
&
Municipalities,
Municipal
Securities,
Non-U.S.
Government
Mortgage-Backed
Securities,
U.S.
Government
&
Agency
Mortgage-Backed
Securities
and
U.S.
Government
Agency
Obligations
(Excluding
Mortgage-Backed).
*
The
fair
value
presented
includes
cumulative
gain
(loss)
on
open
futures
contracts
and
centrally
cleared
swaps;
however,
the
net
value
reflected
on
the
accompanying
Portfolio
of
Investments
is
only
the
unsettled
variation
margin
receivable
(payable)
at
that
date.
T.
ROWE
PRICE
Short
Duration
Income
Fund
46
use
derivatives
for
a
variety
of
purposes
and
may
use
them
to
establish
both
long
and
short
positions
within
the
fund’s
portfolio.
Potential
uses
include
to
hedge
against
declines
in
principal
value,
increase
yield,
invest
in
an
asset
with
greater
efficiency
and
at
a
lower
cost
than
is
possible
through
direct
investment,
to
enhance
return,
or
to
adjust
portfolio
duration
and
credit
exposure.
The
risks
associated
with
the
use
of
derivatives
are
different
from,
and
potentially
much
greater
than,
the
risks
associated
with
investing
directly
in
the
instruments
on
which
the
derivatives
are
based.
The
fund
values
its
derivatives
at
fair
value
and
recognizes
changes
in
fair
value
currently
in
its
results
of
operations.
Accordingly,
the
fund
does
not
follow
hedge
accounting,
even
for
derivatives
employed
as
economic
hedges.
Generally,
the
fund
accounts
for
its
derivatives
on
a
gross
basis.
It
does
not
offset
the
fair
value
of
derivative
liabilities
against
the
fair
value
of
derivative
assets
on
its
financial
statements,
nor
does
it
offset
the
fair
value
of
derivative
instruments
against
the
right
to
reclaim
or
obligation
to
return
collateral.
The
following
table
summarizes
the
fair
value
of
the
fund’s
derivative
instruments
held
as
of
November
30,
2022,
and
the
related
location
on
the
accompanying
Statement
of
Assets
and
Liabilities,
presented
by
primary
underlying
risk
exposure:
($000s)
Location
on
Statement
of
Assets
and
Liabilities
Fair
Value*
Assets
Interest
rate
derivatives
Futures
$
26
Credit
derivatives
Bilateral
Swaps
and
Premiums
,
Centrally
Cleared
Swaps
114
*
Total
$
140
*
Liabilities
Interest
rate
derivatives
Futures
$
8
Credit
derivatives
Centrally
Cleared
Swaps
2
Total
$
10
*
The
fair
value
presented
includes
cumulative
gain
(loss)
on
open
futures
contracts
and
centrally
cleared
swaps;
however,
the
value
reflected
on
the
accompanying
Statement
of
Assets
and
Liabilities
is
only
the
unsettled
variation
margin
receivable
(payable)
at
that
date.
T.
ROWE
PRICE
Short
Duration
Income
Fund
47
Additionally,
the
amount
of
gains
and
losses
on
derivative
instruments
recognized
in
fund
earnings
during
the
six
months ended
November
30,
2022,
and
the
related
location
on
the
accompanying
Statement
of
Operations
is
summarized
in
the
following
table
by
primary
underlying
risk
exposure:
Counterparty
Risk
and
Collateral
The
fund
invests
in
derivatives
in
various
markets,
which
expose
it
to
differing
levels
of
counterparty
risk.
Counterparty
risk
on
exchange-
traded
and
centrally
cleared
derivative
contracts,
such
as
futures,
exchange-traded
options,
and
centrally
cleared
swaps,
is
minimal
because
the
clearinghouse
provides
protection
against
counterparty
defaults.
For
futures
and
centrally
cleared
swaps,
the
fund
is
required
to
deposit
collateral
in
an
amount
specified
by
the
clearinghouse
and
the
clearing
firm
(margin
requirement),
and
the
margin
requirement
must
be
maintained
over
the
life
of
the
contract.
Each
clearinghouse
and
clearing
firm,
in
its
sole
discretion,
may
adjust
the
margin
requirements
applicable
to
the
fund.
Derivatives,
such
as
bilateral
swaps,
forward
currency
exchange
contracts,
and
OTC
options,
that
are
transacted
and
settle
directly
with
a
counterparty
(bilateral
derivatives)
may
expose
the
fund
to
greater
counterparty
risk.
To
mitigate
this
risk,
the
fund
has
entered
into
master
netting
arrangements
(MNAs)
with
certain
counterparties
that
permit
net
settlement
under
specified
conditions
and,
for
certain
counterparties,
also
($000s)
Location
of
Gain
(Loss)
on
Statement
of
Operations
Futures
Swaps
Total
Realized
Gain
(Loss)
Interest
rate
derivatives
$
(349)
$
—
$
(349)
Credit
derivatives
—
(51)
(51)
Total
$
(349)
$
(51)
$
(400)
Change
in
Unrealized
Gain
(Loss)
Interest
rate
derivatives
$
26
$
—
$
26
Credit
derivatives
—
(9)
(9)
Total
$
26
$
(9)
$
17
T.
ROWE
PRICE
Short
Duration
Income
Fund
48
require
the
exchange
of
collateral
to
cover
mark-to-market
exposure.
MNAs
may
be
in
the
form
of
International
Swaps
and
Derivatives
Association
master
agreements
(ISDAs)
or
foreign
exchange
letter
agreements
(FX
letters).
MNAs
provide
the
ability
to
offset
amounts
the
fund
owes
a
counterparty
against
amounts
the
counterparty
owes
the
fund
(net
settlement).
Both
ISDAs
and
FX
letters
generally
allow
termination
of
transactions
and
net
settlement
upon
the
occurrence
of
contractually
specified
events,
such
as
failure
to
pay
or
bankruptcy.
In
addition,
ISDAs
specify
other
events,
the
occurrence
of
which
would
allow
one
of
the
parties
to
terminate.
For
example,
a
downgrade
in
credit
rating
of
a
counterparty
below
a
specified
rating
would
allow
the
fund
to
terminate,
while
a
decline
in
the
fund’s
net
assets
of
more
than
a
specified
percentage
would
allow
the
counterparty
to
terminate.
Upon
termination,
all
transactions
with
that
counterparty
would
be
liquidated
and
a
net
termination
amount
settled.
ISDAs
typically
include
collateral
agreements
whereas
FX
letters
do
not.
Collateral
requirements
are
determined
daily
based
on
the
net
aggregate
unrealized
gain
or
loss
on
all
bilateral
derivatives
with
a
counterparty,
subject
to
minimum
transfer
amounts
that
typically
range
from
$100,000
to
$250,000.
Any
additional
collateral
required
due
to
changes
in
security
values
is
typically
transferred
the
next
business
day.
Collateral
may
be
in
the
form
of
cash
or
debt
securities
issued
by
the
U.S.
government
or
related
agencies,
although
other
securities
may
be
used
depending
on
the
terms
outlined
in
the
applicable
MNA.
Cash
posted
by
the
fund
is
reflected
as
cash
deposits
in
the
accompanying
financial
statements
and
generally
is
restricted
from
withdrawal
by
the
fund;
securities
posted
by
the
fund
are
so
noted
in
the
accompanying
Portfolio
of
Investments;
both
remain
in
the
fund’s
assets.
Collateral
pledged
by
counterparties
is
not
included
in
the
fund’s
assets
because
the
fund
does
not
obtain
effective
control
over
those
assets.
For
bilateral
derivatives,
collateral
posted
or
received
by
the
fund
is
held
in
a
segregated
account
at
the
fund’s
custodian.
While
typically
not
sold
in
the
same
manner
as
equity
or
fixed
income
securities,
exchange-traded
or
centrally
cleared
derivatives
may
be
closed
out
only
on
the
exchange
or
clearinghouse
where
the
contracts
were
cleared,
and
OTC
and
bilateral
derivatives
may
be
unwound
with
counterparties
or
transactions
assigned
to
other
counterparties
to
allow
the
fund
to
exit
the
transaction.
This
ability
is
subject
to
the
liquidity
of
underlying
positions. As
of
November
30,
2022,
no
collateral
was
pledged
by
either
the
fund
or
counterparties for
bilateral
derivatives. As
of
November
30,
2022,
securities
valued
at $102,000
had
been
posted
by
the
fund
for
exchange-traded
and/or
centrally
cleared
derivatives.
Futures
Contracts
The
fund
is
subject
to interest
rate
risk in
the
normal
course
of
pursuing
its
investment
objectives
and
uses
futures
contracts
to
help
manage
such
risk.
The
fund
may
enter
into
futures
contracts
to
manage
exposure
to
interest
rate
T.
ROWE
PRICE
Short
Duration
Income
Fund
49
and
yield
curve
movements,
security
prices,
foreign
currencies,
credit
quality,
and
mortgage
prepayments;
as
an
efficient
means
of
adjusting
exposure
to
all
or
part
of
a
target
market;
to
enhance
income;
as
a
cash
management
tool;
or
to
adjust
portfolio
duration
and
credit
exposure. A
futures
contract
provides
for
the
future
sale
by
one
party
and
purchase
by
another
of
a
specified
amount
of
a
specific
underlying
financial
instrument
at
an
agreed-upon
price,
date,
time,
and
place.
The
fund
currently
invests
only
in
exchange-traded
futures,
which
generally
are
standardized
as
to
maturity
date,
underlying
financial
instrument,
and
other
contract
terms.
Payments
are
made
or
received
by
the
fund
each
day
to
settle
daily
fluctuations
in
the
value
of
the
contract
(variation
margin),
which
reflect
changes
in
the
value
of
the
underlying
financial
instrument.
Variation
margin
is
recorded
as
unrealized
gain
or
loss
until
the
contract
is
closed.
The
value
of
a
futures
contract
included
in
net
assets
is
the
amount
of
unsettled
variation
margin;
net
variation
margin
receivable
is
reflected
as
an
asset
and
net
variation
margin
payable
is
reflected
as
a
liability
on
the
accompanying
Statement
of
Assets
and
Liabilities.
Risks
related
to
the
use
of
futures
contracts
include
possible
illiquidity
of
the
futures
markets,
contract
prices
that
can
be
highly
volatile
and
imperfectly
correlated
to
movements
in
hedged
security
values
and/or
interest
rates,
and
potential
losses
in
excess
of
the
fund’s
initial
investment.
During
the
six
months ended
November
30,
2022,
the
volume
of
the
fund’s
activity
in
futures,
based
on
underlying
notional
amounts,
was
generally
between
21%
and
28%
of
net
assets.
Swaps
The
fund
is
subject
to
credit
risk in
the
normal
course
of
pursuing
its
investment
objectives
and
uses
swap
contracts
to
help
manage
such
risk.
The
fund
may
use
swaps
in
an
effort
to
manage
both
long
and
short
exposure
to
changes
in
interest
rates,
inflation
rates,
and
credit
quality;
to
adjust
overall
exposure
to
certain
markets;
to
enhance
total
return
or
protect
the
value
of
portfolio
securities;
to
serve
as
a
cash
management
tool;
or
to
adjust
portfolio
duration
and
credit
exposure.
Swap
agreements
can
be
settled
either
directly
with
the
counterparty
(bilateral
swap)
or
through
a
central
clearinghouse
(centrally
cleared
swap).
Fluctuations
in
the
fair
value
of
a
contract
are
reflected
in
unrealized
gain
or
loss
and
are
reclassified
to
realized
gain
or
loss
upon
contract
termination
or
cash
settlement.
Net
periodic
receipts
or
payments
required
by
a
contract
increase
or
decrease,
respectively,
the
value
of
the
contract
until
the
contractual
payment
date,
at
which
time
such
amounts
are
reclassified
from
unrealized
to
realized
gain
or
loss.
For
bilateral
swaps,
cash
payments
are
made
or
received
by
the
fund
on
a
periodic
basis
in
accordance
with
contract
terms;
unrealized
gain
on
contracts
and
premiums
paid
are
reflected
as
assets
and
unrealized
loss
on
contracts
and
premiums
received
are
reflected
as
liabilities
on
the
accompanying
Statement
of
Assets
and
Liabilities.
For
bilateral
swaps,
premiums
paid
or
received
are
amortized
over
the
life
of
the
swap
and
are
recognized
as
realized
gain
or
loss
in
the
Statement
of
Operations.
For
centrally
cleared
swaps,
payments
are
made
or
received
by
the
fund
each
day
to
settle
the
daily
T.
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Income
Fund
50
fluctuation
in
the
value
of
the
contract
(variation
margin).
Accordingly,
the
value
of
a
centrally
cleared
swap
included
in
net
assets
is
the
unsettled
variation
margin;
net
variation
margin
receivable
is
reflected
as
an
asset
and
net
variation
margin
payable
is
reflected
as
a
liability
on
the
accompanying
Statement
of
Assets
and
Liabilities.
Credit
default
swaps
are
agreements
where
one
party
(the
protection
buyer)
agrees
to
make
periodic
payments
to
another
party
(the
protection
seller)
in
exchange
for
protection
against
specified
credit
events,
such
as
certain
defaults
and
bankruptcies
related
to
an
underlying
credit
instrument,
or
issuer
or
index
of
such
instruments.
Upon
occurrence
of
a
specified
credit
event,
the
protection
seller
is
required
to
pay
the
buyer
the
difference
between
the
notional
amount
of
the
swap
and
the
value
of
the
underlying
credit,
either
in
the
form
of
a
net
cash
settlement
or
by
paying
the
gross
notional
amount
and
accepting
delivery
of
the
relevant
underlying
credit.
For
credit
default
swaps
where
the
underlying
credit
is
an
index,
a
specified
credit
event
may
affect
all
or
individual
underlying
securities
included
in
the
index
and
will
be
settled
based
upon
the
relative
weighting
of
the
affected
underlying
security(ies)
within
the
index. Generally,
the
payment
risk
for
the
seller
of
protection
is
inversely
related
to
the
current
market
price
or
credit
rating
of
the
underlying
credit
or
the
market
value
of
the
contract
relative
to
the
notional
amount,
which
are
indicators
of
the
markets’
valuation
of
credit
quality.
As
of
November
30,
2022,
the
notional
amount
of
protection
sold
by
the
fund
totaled $940,000
(2.0%
of
net
assets),
which
reflects
the
maximum
potential
amount
the
fund
could
be
required
to
pay
under
such
contracts.
Risks
related
to
the
use
of
credit
default
swaps
include
the
possible
inability
of
the
fund
to
accurately
assess
the
current
and
future
creditworthiness
of
underlying
issuers,
the
possible
failure
of
a
counterparty
to
perform
in
accordance
with
the
terms
of
the
swap
agreements,
potential
government
regulation
that
could
adversely
affect
the
fund’s
swap
investments,
and
potential
losses
in
excess
of
the
fund’s
initial
investment.
During
the
six
months ended
November
30,
2022,
the
volume
of
the
fund’s
activity
in
swaps,
based
on
underlying
notional
amounts,
was
generally
between
0%
and
5%
of
net
assets.
NOTE
4
-
OTHER
INVESTMENT
TRANSACTIONS
Consistent
with
its
investment
objective,
the
fund
engages
in
the
following
practices
to
manage
exposure
to
certain
risks
and/or
to
enhance
performance.
The
investment
objective,
policies,
program,
and
risk
factors
of
the
fund
are
described
more
fully
in
the
fund’s
prospectus
and
Statement
of
Additional
Information.
T.
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PRICE
Short
Duration
Income
Fund
51
Noninvestment-Grade
Debt
The
fund
invests,
either
directly
or
through
its
investment
in
other
T.
Rowe
Price
funds,
in
noninvestment-grade
debt,
including
“high
yield”
or
“junk”
bonds
or
leveraged
loans.
Noninvestment-grade
debt
issuers
are
more
likely
to
suffer
an
adverse
change
in
financial
condition
that
would
result
in
the
inability
to
meet
a
financial
obligation.
The
noninvestment-grade
debt
market
may
experience
sudden
and
sharp
price
swings
due
to
a
variety
of
factors
that
may
decrease
the
ability
of
issuers
to
make
principal
and
interest
payments
and
adversely
affect
the
liquidity
or
value,
or
both,
of
such
securities.
Accordingly,
securities
issued
by
such
companies
carry
a
higher
risk
of
default
and
should
be
considered
speculative.
Restricted
Securities
The
fund
invests
in
securities
that
are
subject
to
legal
or
contractual
restrictions
on
resale.
Prompt
sale
of
such
securities
at
an
acceptable
price
may
be
difficult
and
may
involve
substantial
delays
and
additional
costs.
Collateralized
Loan
Obligations
The
fund
invests
in
collateralized
loan
obligations
(CLOs)
which
are
entities
backed
by
a
diversified
pool
of
syndicated
bank
loans.
The
cash
flows
of
the
CLO
can
be
split
into
multiple
segments,
called
“tranches”
or
“classes”,
which
will
vary
in
risk
profile
and
yield.
The
riskiest
segments,
which
are
the
subordinate
or
“equity”
tranches,
bear
the
greatest
risk
of
loss
from
defaults
in
the
underlying
assets
of
the
CLO
and
serve
to
protect
the
other,
more
senior,
tranches.
Senior
tranches
will
typically
have
higher
credit
ratings
and
lower
yields
than
the
securities
underlying
the
CLO.
Despite
the
protection
from
the
more
junior
tranches,
senior
tranches
can
experience
substantial
losses.
Mortgage-Backed
Securities
The
fund
invests
in
mortgage-backed
securities
(MBS
or
pass-through
certificates)
that
represent
an
interest
in
a
pool
of
specific
underlying
mortgage
loans
and
entitle
the
fund
to
the
periodic
payments
of
principal
and
interest
from
those
mortgages.
MBS
may
be
issued
by
government
agencies
or
corporations,
or
private
issuers.
Most
MBS
issued
by
government
agencies
are
guaranteed;
however,
the
degree
of
protection
differs
based
on
the
issuer.
MBS are
sensitive
to
changes
in
economic
conditions
that
affect
the
rate
of
prepayments
and
defaults
on
the
underlying
mortgages;
accordingly,
the
value,
income,
and
related
cash
flows
from
MBS
may
be
more
volatile
than
other
debt
instruments.
TBA
Purchase,
Sale
Commitments
and
Forward
Settling
Mortgage
Obligations
The
fund
enters
into
to-be-announced
(TBA)
purchase
or
sale
commitments
(collectively,
TBA
transactions),
pursuant
to
which
it
agrees
to
purchase
or
sell,
respectively,
mortgage-backed
securities
for
a
fixed
unit
price,
with
payment
and
delivery
at
a
scheduled
future
date
beyond
the
customary
settlement
period
for
such
securities.
With
TBA
transactions,
the
particular
securities
to
be
received
or
delivered
by
the
fund
are
not
identified
at
the
trade
date;
however,
the
securities
must
meet
specified
terms,
including
T.
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PRICE
Short
Duration
Income
Fund
52
rate
and
mortgage
term,
and
be
within
industry-accepted
“good
delivery”
standards.
The
fund
may
enter
into
TBA
transactions
with
the
intention
of
taking
possession
of
or
relinquishing
the
underlying
securities,
may
elect
to
extend
the
settlement
by
“rolling”
the
transaction,
and/or
may
use
TBA
transactions
to
gain
or
reduce
interim
exposure
to
underlying
securities.
Until
settlement,
the
fund
maintains
liquid
assets
sufficient
to
settle
its
commitment
to
purchase
a
TBA
or,
in
the
case
of
a
sale
commitment,
the
fund
maintains
an
entitlement
to
the
security
to
be
sold.
To
mitigate
counterparty
risk,
the
fund
has
entered
into
Master
Securities
Forward
Transaction
Agreements
(MSFTA)
with
counterparties
that
provide
for
collateral
and
the
right
to
offset
amounts
due
to
or
from
those
counterparties
under
specified
conditions.
Subject
to
minimum
transfer
amounts,
collateral
requirements
are
determined
and
transfers
made
based
on
the
net
aggregate
unrealized
gain
or
loss
on
all
TBA
commitments
and
other
forward
settling
mortgage
obligations
with
a
particular
counterparty
(collectively,
MSFTA
Transactions).
At
any
time,
the
fund’s
risk
of
loss
from
a
particular
counterparty
related
to
its
MSFTA
Transactions
is
the
aggregate
unrealized
gain
on
appreciated
MSFTA
Transactions
in
excess
of
unrealized
loss
on
depreciated
MSFTA
Transactions
and
collateral
received,
if
any,
from
such
counterparty. As
of
November
30,
2022,
no
collateral
was
pledged
by
the
fund
or
counterparties
for
MSFTA
Transactions.
Bank
Loans
The
fund
invests
in
bank
loans,
which
represent
an
interest
in
amounts
owed
by
a
borrower
to
a
syndicate
of
lenders.
Bank
loans
are
generally
noninvestment
grade
and
often
involve
borrowers
whose
financial
condition
is
highly
leveraged.
The
fund
may
invest
in
fixed
and
floating
rate
loans,
which
may
include
senior
floating
rate
loans;
secured
and
unsecured
loans,
second
lien
or
more
junior
loans;
and
bridge
loans
or
bridge
facilities.
Certain
bank
loans
may
be
revolvers
which
are
a
form
of
senior
bank
debt,
where
the
borrower
can
draw
down
the
credit
of
the
revolver
when
it
needs
cash
and
repays
the
credit
when
the
borrower
has
excess
cash.
Certain
loans
may
be
“covenant-lite”
loans,
which
means
the
loans
contain
fewer
maintenance
covenants
than
other
loans
(in
some
cases,
none)
and
do
not
include
terms
which
allow
the
lender
to
monitor
the
performance
of
the
borrower
and
declare
a
default
if
certain
criteria
are
breached.
As
a
result
of
these
risks,
the
fund’s
exposure
to
losses
may
be
increased.
Bank
loans
may
be
in
the
form
of
either
assignments
or
participations.
A
loan
assignment
transfers
all
legal,
beneficial,
and
economic
rights
to
the
buyer,
and
transfer
typically
requires
consent
of
both
the
borrower
and
agent.
In
contrast,
a
loan
participation
generally
entitles
the
buyer
to
receive
the
cash
flows
from
principal,
interest,
and
any
fee
payments
on
a
portion
of
a
loan;
however,
the
seller
continues
to
T.
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PRICE
Short
Duration
Income
Fund
53
hold
legal
title
to
that
portion
of
the
loan.
As
a
result,
the
buyer
of
a
loan
participation
generally
has
no
direct
recourse
against
the
borrower
and
is
exposed
to
credit
risk
of
both
the
borrower
and
seller
of
the
participation.
Bank
loans
often
have
extended
settlement
periods,
generally
may
be
repaid
at
any
time
at
the
option
of
the
borrower,
and
may
require
additional
principal
to
be
funded
at
the
borrowers’
discretion
at
a
later
date
(e.g.
unfunded
commitments
and
revolving
debt
instruments).
Until
settlement,
the
fund
maintains
liquid
assets
sufficient
to
settle
its
unfunded
loan
commitments.
The
fund
reflects
both
the
funded
portion
of
a
bank
loan
as
well
as
its
unfunded
commitment
in
the
Portfolio
of
Investments.
However,
if
a
credit
agreement
provides
no
initial
funding
of
a
tranche,
and
funding
of
the
full
commitment
at
a
future
date(s)
is
at
the
borrower’s
discretion
and
considered
uncertain,
a
loan
is
reflected
in
the
Portfolio
of
Investments
only
if,
and
only
to
the
extent
that,
the
fund
has
actually
settled
a
funding
commitment.
LIBOR
Transition
The fund
may
invest
in
instruments
that
are
tied
to
reference
rates,
including
London
Interbank
Offered
Rate
(LIBOR).
Over
the
course
of
the
last
several
years,
global
regulators
have
indicated
an
intent
to
phase
out
the
use
of
LIBOR
and
similar
interbank
offered
rates
(IBOR).
While
publication
for
most
LIBOR
currencies
and
lesser-used
USD
LIBOR
settings
ceased
immediately
after
December
31,
2021,
remaining
USD
LIBOR
settings
will
continue
to
be
published
until
June
30,
2023.
There
remains
uncertainty
regarding
the
future
utilization
of
LIBOR
and
the
nature
of
any
replacement
rate.
Any
potential
effects
of
the
transition
away
from
LIBOR
on
the fund,
or
on
certain
instruments
in
which
the fund
invests,
cannot
yet
be
determined.
The
transition
process
may
result
in,
among
other
things,
an
increase
in
volatility
or
illiquidity
of
markets
for
instruments
that
currently
rely
on
LIBOR,
a
reduction
in
the
value
of
certain
instruments
held
by
the fund,
or
a
reduction
in
the
effectiveness
of
related
fund
transactions
such
as
hedges.
Any
such
effects
could
have
an
adverse
impact
on
the fund's
performance.
Securities
Lending
The fund
may
lend
its
securities
to
approved
borrowers
to
earn
additional
income.
Its
securities
lending
activities
are
administered
by
a
lending
agent
in
accordance
with
a
securities
lending
agreement.
Security
loans
generally
do
not
have
stated
maturity
dates,
and
the
fund
may
recall
a
security
at
any
time.
The
fund
receives
collateral
in
the
form
of
cash
or
U.S.
government
securities.
Collateral
is
maintained
over
the
life
of
the
loan
in
an
amount
not
less
than
the
value
of
loaned
securities;
any
additional
collateral
required
due
to
changes
in
security
values
is
delivered
to
the
fund
the
next
business
day.
Cash
collateral
is
invested
in
accordance
with
investment
guidelines
approved
by
fund
management.
Additionally,
the
lending
agent
indemnifies
the
fund
against
losses
resulting
from
borrower
default.
Although
risk
is
mitigated
by
the
collateral
and
indemnification,
the
fund
could
experience
a
delay
in
recovering
T.
ROWE
PRICE
Short
Duration
Income
Fund
54
its
securities
and
a
possible
loss
of
income
or
value
if
the
borrower
fails
to
return
the
securities,
collateral
investments
decline
in
value,
and
the
lending
agent
fails
to
perform.
Securities
lending
revenue
consists
of
earnings
on
invested
collateral
and
borrowing
fees,
net
of
any
rebates
to
the
borrower,
compensation
to
the
lending
agent,
and
other
administrative
costs.
In
accordance
with
GAAP,
investments
made
with
cash
collateral
are
reflected
in
the
accompanying
financial
statements,
but
collateral
received
in
the
form
of
securities
is
not.
At
November
30,
2022,
the
value
of
loaned
securities
was
$179,000;
the
value
of
cash
collateral
and
related
investments
was
$185,000.
Other
Purchases
and
sales
of
portfolio
securities
other
than
short-term and
U.S.
government
securities
aggregated $5,060,000 and
$8,454,000,
respectively,
for
the
six
months ended
November
30,
2022.
Purchases
and
sales
of
U.S.
government
securities
aggregated
$17,200,000 and
$15,696,000,
respectively,
for
the
six
months ended
November
30,
2022.
NOTE
5
-
FEDERAL
INCOME
TAXES
No
provision
for
federal
income
taxes
is
required
since
the
fund
intends
to
continue
to
qualify
as
a
regulated
investment
company
under
Subchapter
M
of
the
Internal
Revenue
Code
and
distribute
to
shareholders
all
of
its
taxable
income
and
gains.
Distributions
determined
in
accordance
with
federal
income
tax
regulations
may
differ
in
amount
or
character
from
net
investment
income
and
realized
gains
for
financial
reporting
purposes.
Financial
reporting
records
are
adjusted
for
permanent
book/tax
differences
to
reflect
tax
character
but
are
not
adjusted
for
temporary
differences.
The
amount
and
character
of
tax-basis
distributions
and
composition
of
net
assets
are
finalized
at
fiscal
year-end;
accordingly,
tax-basis
balances
have
not
been
determined
as
of
the
date
of
this
report.
At
November
30,
2022,
the
cost
of
investments
(including
derivatives,
if
any) for
federal
income
tax
purposes
was
$49,450,000.
Net
unrealized
loss
aggregated
$2,252,000
at
period-end,
of
which
$57,000
related
to
appreciated
investments
and
$2,309,000
related
to
depreciated
investments.
NOTE
6
-
RELATED
PARTY
TRANSACTIONS
The
fund
is
managed
by
T.
Rowe
Price
Associates,
Inc.
(Price
Associates),
a
wholly
owned
subsidiary
of
T.
Rowe
Price
Group,
Inc.
(Price
Group).
Price
Associates
has
entered
into
a
sub-advisory
agreement(s)
with
one
or
more
of
its
wholly
owned
subsidiaries,
to
provide
investment
advisory
services
to
the
fund.The
investment
T.
ROWE
PRICE
Short
Duration
Income
Fund
55
management
agreement
between
the
fund
and
Price
Associates
provides
for
an
annual
investment
management
fee,
which
is
computed
daily
and
paid
monthly.
The
fee
is
determined
by
applying
a
group
fee
rate
to
the
fund’s
average
daily
net
assets.
The
group
fee
rate
is
calculated
based
on
the
combined
net
assets
of
certain
mutual
funds
sponsored
by
rates
$845
fee
rate
was
0.29%.
The Investor Class
is
subject
to
a
contractual
expense
limitation
through
the
expense
limitation
date
indicated
in
the
table
below.
During
the
limitation
period,
Price
Associates
is
required
to
waive
its
management
fee
or
pay
any
expenses
(excluding
interest;
expenses
related
to
borrowings,
taxes,
and
brokerage;
non-recurring,
extraordinary expenses;
and
acquired
fund
fees
and
expenses) that
would
otherwise
cause
the
class’s
ratio
of
annualized
total
expenses
to
average
net
assets
(net
expense
ratio)
to
exceed
its
expense
limitation.
The
class
is
required
to
repay
Price
Associates
for
expenses
previously
waived/paid
to
the
extent
the
class’s
net
assets
grow
or
expenses
decline
sufficiently
to
allow
repayment
without
causing
the
class’s
net
expense
ratio
(after
the
repayment
is
taken
into
account)
to
exceed
the
lesser
of:
(1)
the
expense
limitation
in
place
at
the
time
such
amounts
were
waived;
or
(2)
the
class’s
current
expense
limitation.
However,
no
repayment
will
be
made
more
than
three
years
after
the
date
of
a
payment
or
waiver.
The
I
Class
is
also
subject
to
an
operating
expense
limitation
(I
Class
Limit)
pursuant
to
which
Price
Associates
is
contractually
required
to
pay
all
operating
expenses
of
the
I
Class,
excluding
management
fees;
interest;
expenses
related
to
borrowings,
taxes,
and
brokerage; non-recurring,
extraordinary expenses; and
acquired
fund
fees
and
expenses, to
the
extent
such
operating
expenses,
on
an
annualized
basis,
exceed
the
I
Class
Limit. This
agreement
will
continue
through
the
expense
limitation
date
indicated
in
the
table
below,
and
may
be
renewed,
revised,
or
revoked
only
with
approval
of
the
fund’s
Board.
The
I
Class
is
required
to
repay
Price
Associates
for
expenses
previously
paid
to
the
extent
the
class’s
net
assets
grow
or
expenses
decline
sufficiently
to
allow
repayment
without
causing
the
class’s
operating
expenses
(after
the
repayment
is
taken
into
account)
to
exceed
the
lesser
of:
(1)
the
I
Class
Limit
in
place
at
the
time
such
amounts
were
paid;
or
(2)
the
current
I
Class
Limit.
However,
no
repayment
will
be
made
more
than
three
years
after
the
date
of
a
payment
or
waiver.
Pursuant
to
these
agreements,
expenses
were
waived/paid
by
and/or
repaid
to
Price
Associates
during
the
six
months ended November
30,
2022
as
indicated
in
the
table
below
and
remain
subject
to
repayment
by
the
fund.
Including these
amounts,
expenses
previously
waived/paid
by
Price
Associates
in
the
amount
of $586,000 remain
subject
to
repayment
by
the
fund
at
November
30,
2022.
Any
repayment
of
expenses
T.
ROWE
PRICE
Short
Duration
Income
Fund
56
previously
waived/paid
by
Price
Associates
during
the
period
would
be
included
in
the
net
investment
income
and
expense
ratios
presented
on
the
accompanying
Financial
Highlights.
In
addition,
the
fund
has
entered
into
service
agreements
with
Price
Associates
and
a
wholly
owned
subsidiary
of
Price
Associates,
each
an
affiliate
of
the
fund
(collectively,
Price).
Price
Associates
provides
certain
accounting
and
administrative
services
to
the
fund.
T.
Rowe
Price
Services,
Inc.
provides
shareholder
and
administrative
services
in
its
capacity
as
the
fund’s
transfer
and
dividend-disbursing
agent.
For
the
six
months ended
November
30,
2022,
expenses
incurred
pursuant
to
these
service
agreements
were
$50,000 for
Price
Associates
and $13,000
for
T.
Rowe
Price
Services,
Inc.
All
amounts
due
to
and
due
from
Price,
exclusive
of
investment
management
fees
payable,
are
presented
net
on
the
accompanying
Statement
of
Assets
and
Liabilities.
The fund
may
invest
its
cash
reserves
in
certain
open-end
management
investment
companies
managed
by
Price
Associates
and
considered
affiliates
of
the
fund:
the
T.
Rowe
Price
Government
Reserve
Fund
or
the
T.
Rowe
Price
Treasury
Reserve
Fund,
organized
as
money
market
funds (together,
the
Price
Reserve
Funds).
The
Price
Reserve
Funds
are
offered
as
short-term
investment
options
to
mutual
funds,
trusts,
and
other
accounts
managed
by
Price
Associates
or
its
affiliates
and
are
not
available
for
direct
purchase
by
members
of
the
public.
Cash
collateral
from
securities
lending,
if
any,
is
invested
in
the
T.
Rowe
Price
Government
Reserve Fund. The
Price
Reserve
Funds
pay
no
investment
management
fees.
As
of
November
30,
2022,
T.
Rowe
Price
Group,
Inc.,
or
its
wholly
owned
subsidiaries,
owned
1,975,000
shares
of
the
Investor
Class,
representing
62%
of
the
Investor
Class's
net
assets.
The
fund may
participate
in
securities
purchase
and
sale
transactions
with
other
funds
or
accounts
advised
by
Price
Associates
(cross
trades),
in
accordance
with
procedures
adopted
by the
fund’s
Board
and
Securities
and
Exchange
Commission
rules,
which
require,
among
other
things,
that
such
purchase
sale
cross
trades
be
effected
at
the
independent
current
market
price
of
the
security.
During
the
six
months ended
November
30,
2022,
the
fund
had
no
purchases
or
sales
cross
trades
with
other
funds
or
accounts
advised
by
Price
Associates.
Investor
Class
I
Class
Expense
limitation/I
Class
Limit
0.40%
0.01%
Expense
limitation
date
09/30/23
09/30/23
(Waived)/repaid
during
the
period
($000s)
$(101)
$(58)
T.
ROWE
PRICE
Short
Duration
Income
Fund
57
NOTE
7
-
OTHER
MATTERS
Unpredictable
events
such
as
environmental
or
natural
disasters,
war,
terrorism,
pandemics,
outbreaks
of
infectious
diseases,
and
similar
public
health
threats
may
significantly
affect
the
economy
and
the
markets
and
issuers
in
which
a
fund
invests.
Certain
events
may
cause
instability
across
global
markets,
including
reduced
liquidity
and
disruptions
in
trading
markets,
while
some
events
may
affect
certain
geographic
regions,
countries,
sectors,
and
industries
more
significantly
than
others,
and
exacerbate
other
pre-existing
political,
social,
and
economic
risks.
Since
2020,
a
novel
strain
of
coronavirus
(COVID-19)
has
resulted
in
disruptions
to
global
business
activity
and
caused
significant
volatility
and
declines
in
global
financial
markets.
In
February
2022,
Russian
forces
entered
Ukraine
and
commenced
an
armed
conflict
leading
to
economic
sanctions
being
imposed
on
Russia
and
certain
of
its
citizens,
creating
impacts
on
Russian-related
stocks
and
debt
and
greater
volatility
in
global
markets.
These
are
recent
examples
of
global
events
which
may
have
a
negative
impact
on
the
values
of
certain
portfolio
holdings
or
the
fund’s
overall
performance.
Management
is
actively
monitoring
the
risks
and
financial
impacts
arising
from
these
events.
T.
ROWE
PRICE
Short
Duration
Income
Fund
58
INFORMATION
ON
PROXY
VOTING
POLICIES,
PROCEDURES,
AND
RECORDS
A
description
of
the
policies
and
procedures
used
by
T.
Rowe
Price
funds
to
determine
how
to
vote
proxies
relating
to
portfolio
securities
is
available
in
each
fund’s
Statement
of
Additional
Information.
You
may
request
this
document
by
calling
1-800-225-5132
or
by
accessing
the
SEC’s
website,
sec.gov.
The
description
of
our
proxy
voting
policies
and
procedures
is
also
available
on
our
corporate
website.
To
access
it,
please
visit
the
following
Web
page:
https://www.troweprice.com/corporate/us/en/utility/policies.html
Scroll
down
to
the
section
near
the
bottom
of
the
page
that
says,
“Proxy
Voting
Guidelines.”
Click
on
the
links
in
the
shaded
box.
Each
fund’s
most
recent
annual
proxy
voting
record
is
available
on
our
website
and
through
the
SEC’s
website.
To
access
it
through
T.
Rowe
Price,
visit
the
website
location
shown
above,
and
scroll
down
to
the
section
near
the
bottom
of
the
page
that
says,
“Proxy
Voting
Records.”
Click
on
the
Proxy
Voting
Records
link
in
the
shaded
box.
HOW
TO
OBTAIN
QUARTERLY
PORTFOLIO
HOLDINGS
The
fund
files
a
complete
schedule
of
portfolio
holdings
with
the
Securities
and
Exchange
Commission
(SEC)
for
the
first
and
third
quarters
of
each
fiscal
year
as
an
exhibit
to
its
reports
on
Form
N-PORT.
The
fund’s
reports
on
Form
N-PORT
are
available
electronically
on
the
SEC’s
website
(sec.gov).
In
addition,
most
T.
Rowe
Price
funds
disclose
their
first
and
third
fiscal
quarter-end
holdings
on
troweprice.com
.
T.
ROWE
PRICE
Short
Duration
Income
Fund
59
APPROVAL
OF
SUBADVISORY
AGREEMENT
At
a
meeting
held
on
July
25,
2022
(Meeting),
the
fund’s
Board
of
Directors
(Board)
considered
the
initial
approval
of
an
investment
subadvisory
agreement
(Subadvisory
Contract)
that
T.
Rowe
Price
Associates,
Inc.
(Adviser),
entered
into
with
T.
Rowe
Price
International
Ltd
(Subadviser)
on
behalf
of
the
fund.
The
Subadvisory
Contract
authorizes
the
Subadviser
to
have
investment
discretion
with
respect
to
all
or
a
portion
of
the
fund’s
portfolio.
The
Board
noted
that
the
Subadvisory
Contract
will
be
substantially
similar
to
other
subadvisory
agreements
that
are
in
place
for
other
T.
Rowe
Price
funds
that
delegate
investment
management
responsibilities
to
affiliated
investment
advisers
and
that
the
Adviser
will
retain
oversight
responsibilities
with
respect
to
the
fund.
The
Board
also
noted
that
the
new
subadvisory
arrangement
will
not
change
the
total
advisory
fees
paid
by
the
fund.
However,
under
the
Subadvisory
Contract,
the
Adviser
may
pay
the
Subadviser
up
to
60%
of
the
advisory
fees
that
the
Adviser
receives
from
the
fund.
At
the
Meeting,
the
Board
reviewed
materials
relevant
to
its
consideration
of
the
proposed
Subadvisory
Contract.
Each
year,
the
Board
considers
the
continuation
of
the
investment
management
agreement
(Advisory
Contract)
between
the
fund
and
the
Adviser.
The
fund’s
Advisory
Contract
was
most
recently
approved
by
the
Board
at
a
meeting
held
on
March
7–8,
2022
(March
Meeting).
A
discussion
of
the
basis
for
the
Board’s
approval
of
the
Advisory
Contract
is
included
in
the
fund’s
annual
shareholder
report
for
the
period
ended
May
31,
2022.
The
factors
considered
by
the
Board
at
the
Meeting
in
connection
with
approval
of
the
proposed
Subadvisory
Contract
were
substantially
similar
to
the
factors
considered
at
the
March
Meeting
in
connection
with
the
approval
to
continue
the
Advisory
Contract.
The
independent
directors
were
assisted
in
their
evaluation
of
the
Subadvisory
Contract
by
independent
legal
counsel
from
whom
they
received
separate
legal
advice
and
with
whom
they
met
separately.
Following
discussion
at
the
Meeting,
the
Board,
including
all
of
the
fund’s
independent
directors,
approved
the
Subadvisory
Contract
between
the
Adviser
and
Subadviser
on
behalf
of
the
fund.
No
single
factor
was
considered
in
isolation
or
to
be
determinative
to
the
decision.
Rather,
the
Board
concluded,
in
light
of
a
weighting
and
balancing
of
all
factors
considered,
that
it
was
in
the
best
interests
of
the
fund
and
its
shareholders
for
the
Board
to
approve
the
Subadvisory
Contract
effective
September
1,
2022.
T.
ROWE
PRICE
Short
Duration
Income
Fund
60
LIQUIDITY
RISK
MANAGEMENT
PROGRAM
In
accordance
with
Rule
22e-4
(Liquidity
Rule)
under
the
Investment
Company
Act
of
1940,
as
amended,
the
fund
has
established
a
liquidity
risk
management
program
(Liquidity
Program)
reasonably
designed
to
assess
and
manage
the
fund’s
liquidity
risk,
which
generally
represents
the
risk
that
the
fund
would
not
be
able
to
meet
redemption
requests
without
significant
dilution
of
remaining
investors’
interests
in
the
fund.
The
fund’s
Board
of
Directors
(Board)
has
appointed
the
fund’s
investment
adviser,
T.
Rowe
Price
Associates,
Inc.
(Adviser),
as
the
administrator
of
the
Liquidity
Program.
As
administrator,
the
Adviser
is
responsible
for
overseeing
the
day-to-day
operations
of
the
Liquidity
Program
and,
among
other
things,
is
responsible
for
assessing,
managing,
and
reviewing
with
the
Board
at
least
annually
the
liquidity
risk
of
each
T.
Rowe
Price
fund.
The
Adviser
has
delegated
oversight
of
the
Liquidity
Program
to
a
Liquidity
Risk
Committee
(LRC),
which
is
a
cross-functional
committee
composed
of
personnel
from
multiple
departments
within
the
Adviser.
The
Liquidity
Program’s
principal
objectives
include
supporting
the
T.
Rowe
Price
funds’
compliance
with
limits
on
investments
in
illiquid
assets
and
mitigating
the
risk
that
the
fund
will
be
unable
to
timely
meet
its
redemption
obligations.
The
Liquidity
Program
also
includes
a
number
of
elements
that
support
the
management
and
assessment
of
liquidity
risk,
including
an
annual
assessment
of
factors
that
influence
the
fund’s
liquidity
and
the
periodic
classification
and
reclassification
of
a
fund’s
investments
into
categories
that
reflect
the
LRC’s
assessment
of
their
relative
liquidity
under
current
market
conditions.
Under
the
Liquidity
Program,
every
investment
held
by
the
fund
is
classified
at
least
monthly
into
one
of
four
liquidity
categories
based
on
estimations
of
the
investment’s
ability
to
be
sold
during
designated
time
frames
in
current
market
conditions
without
significantly
changing
the
investment’s
market
value.
As
required
by
the
Liquidity
Rule,
at
a
meeting
held
on
July
25,
2022,
the
Board
was
presented
with
an
annual
assessment
prepared
by
the
LRC,
on
behalf
of
the
Adviser,
that
addressed
the
operation
of
the
Liquidity
Program
and
assessed
its
adequacy
and
effectiveness
of
implementation,
including
any
material
changes
to
the
Liquidity
Program
and
the
determination
of
each
fund’s
Highly
Liquid
Investment
Minimum
(HLIM).
The
annual
assessment
included
consideration
of
the
following
factors,
as
applicable:
the
fund’s
investment
strategy
and
liquidity
of
portfolio
investments
during
normal
and
reasonably
foreseeable
stressed
conditions,
including
whether
the
investment
strategy
is
appropriate
for
an
open-end
fund,
the
extent
to
which
the
strategy
involves
a
relatively
concentrated
portfolio
or
large
positions
in
particular
issuers,
and
the
use
of
borrowings
for
investment
purposes
and
derivatives;
short-term
and
long-term
cash
flow
projections
covering
both
normal
and
reasonably
foreseeable
stressed
conditions;
and
holdings
of
cash
and
cash
equivalents,
as
well
as
available
borrowing
arrangements.
T.
ROWE
PRICE
Short
Duration
Income
Fund
61
For
the
fund
and
other
T.
Rowe
Price
funds,
the
annual
assessment
incorporated
a
report
related
to
a
fund’s
holdings,
shareholder
and
portfolio
concentration,
any
borrowings
during
the
period,
cash
flow
projections,
and
other
relevant
data
for
the
period
of
April
1,
2021,
through
March
31,
2022.
The
report
described
the
methodology
for
classifying
a
fund’s
investments
(including
any
derivative
transactions)
into
one
of
four
liquidity
categories,
as
well
as
the
percentage
of
a
fund’s
investments
assigned
to
each
category.
It
also
explained
the
methodology
for
establishing
a
fund’s
HLIM
and
noted
that
the
LRC
reviews
the
HLIM
assigned
to
each
fund
no
less
frequently
than
annually.
During
the
period
covered
by
the
annual
assessment,
the
LRC
has
concluded,
and
reported
to
the
Board,
that
the
Liquidity
Program
continues
to
operate
adequately
and
effectively
and
is
reasonably
designed
to
assess
and
manage
the
fund’s
liquidity
risk.
LIQUIDITY
RISK
MANAGEMENT
PROGRAM
(continued)
T.
Rowe
Price
Investment
Services,
Inc.
|
100
East
Pratt
Street
|
Baltimore,
MD
21202-1009
You
have
many
investment
goals.
Explore
products
and
services
that
can
help
you
achieve
them.
Whether
you
want
to
put
away
more
money
for
retirement,
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a
child’s
education,
or
for
other
priorities,
we
have
solutions
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you.
See
how
we
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you.
RETIREMENT
IRAs:
Traditional,
Roth,
Rollover/Transfer,
or
Brokerage
Small
Business
Plans
help
minimize
taxes,
maximize
savings
T.
Rowe
Price
®
ActivePlus
Portfolios
1
for
online
investing
powered
by
experts
GENERAL
INVESTING
Individual
or
Joint
Tenant
Brokerage
2
offers
access
to
stocks,
ETFs,
bonds,
and
more
Gifts
and
transfers
to
a
child
(UGMA/UTMAs)
Trust
Transfer
on
Death
COLLEGE
SAVINGS
T.
Rowe
Price-managed
529
plans
offer
tax-
advantaged
solutions
for
families
saving
money
for
college
tuition
and
education-
related
expenses
Visit
troweprice.com/broadrange
Call
1-800-225-5132
to
request
a
prospectus
or
summary
prospectus;
each
includes
investment
objectives,
risks,
fees,
expenses,
and
other
information
that
you
should
read
and
consider
carefully
before
investing.
All
mutual
funds
are
subject
to
market
risk,
including
possible
loss
of
principal.
Investing
internationally
involves
special
risks
including
economic
and
political
uncertainty
and
currency
fluctuation.
1
The
T.
Rowe
Price
®
ActivePlus
Portfolios
is
a
discretionary
investment
management
program
provided
by
T.
Rowe
Price
Advisory
Services,
Inc.,
a
registered
investment
adviser
under
the
Investment
Advisers
Act
of
1940.
Brokerage
services
are
provided
by
T.
Rowe
Price
Investment
Services,
Inc.,
member
FINRA/SIPC.
Brokerage
accounts
are
carried
by
Pershing
LLC,
a
BNY
Mellon
Company,
member
NYSE/FINRA/SIPC.
T.
Rowe
Price
Advisory
Services,
Inc.,
and
T.
Rowe
Price
Investment
Services,
Inc.,
are
affiliated
companies.
2
Brokerage
services
are
provided
by
T.
Rowe
Price
Investment
Services,
Inc.,
member
FINRA/SIPC.
Brokerage
accounts
are
carried
by
Pershing
LLC,
a
BNY
Mellon
Company,
member
NYSE/FINRA/SIPC.
202301-2568428
F1305-051
1/23
Item 1. (b) Notice pursuant to Rule 30e-3.
Not applicable.
Item 2. Code of Ethics.
A code of ethics, as defined in Item 2 of Form N-CSR, applicable to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions is filed as an exhibit to the registrant’s annual Form N-CSR. No substantive amendments were approved or waivers were granted to this code of ethics during the registrant’s most recent fiscal half-year.
Item 3. Audit Committee Financial Expert.
Disclosure required in registrant’s annual Form N-CSR.
Item 4. Principal Accountant Fees and Services.
Disclosure required in registrant’s annual Form N-CSR.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Investments.
(a) Not applicable. The complete schedule of investments is included in Item 1 of this Form N-CSR.
(b) Not applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
There has been no change to the procedures by which shareholders may recommend nominees to the registrant’s board of directors.
Item 11. Controls and Procedures.
(a) The registrant’s principal executive officer and principal financial officer have evaluated the registrant’s disclosure controls and procedures within 90 days of this filing and have concluded that the registrant’s disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-CSR was recorded, processed, summarized, and reported timely.
(b) The registrant’s principal executive officer and principal financial officer are aware of no change in the registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
Not applicable.
Item 13. Exhibits.
| (a)(1) | The registrant’s code of ethics pursuant to Item 2 of Form N-CSR is filed with the registrant’s annual Form N-CSR. | |
| (2) | ||
| (3) | Written solicitation to repurchase securities issued by closed-end companies: not applicable. | |
| (b) | ||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
T. Rowe Price Short-Term Bond Fund, Inc.
| By | /s/ David Oestreicher | |
| David Oestreicher | ||
| Principal Executive Officer | ||
| Date | January 19, 2023 | |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
| By | /s/ David Oestreicher | |
| David Oestreicher | ||
| Principal Executive Officer | ||
| Date | January 19, 2023 | |
| By | /s/ Alan S. Dupski | |
| Alan S. Dupski | ||
| Principal Financial Officer | ||
| Date | January 19, 2023 | |