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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM N-CSR
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CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-08727
SunAmerica Senior Floating Rate Fund, Inc.
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(Exact name of registrant as specified in charter)
Harborside 5, 185 Hudson Street, Suite 3300, Jersey City, NJ 07311
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(Address of principal executive offices) (Zip code)
John T. Genoy
Senior Vice President
SunAmerica Asset Management, LLC
Harborside 5, 185 Hudson Street, Suite 3300
Jersey City, NJ 07311
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(Name and address of agent for service)
Registrant's telephone number, including area code: (201) 324-6414
Date of fiscal year end: December 31
Date of reporting period: December 31, 2016
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Item 1. Reports to Stockholders
[GRAPHIC]
ANNUAL REPORT 2016
SUNAMERICA
Senior Floating Rate Fund
[LOGO]
TABLE OF CONTENTS
SHAREHOLDERS' LETTER.................................... 2
EXPENSE EXAMPLE......................................... 4
STATEMENT OF ASSETS AND LIABILITIES..................... 6
STATEMENT OF OPERATIONS................................. 7
STATEMENT OF CHANGES IN NET ASSETS...................... 8
FINANCIAL HIGHLIGHTS.................................... 9
PORTFOLIO OF INVESTMENTS................................ 10
NOTES TO FINANCIAL STATEMENTS........................... 21
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM. 33
DIRECTORS AND OFFICERS INFORMATION...................... 34
SHAREHOLDER TAX INFORMATION............................. 36
COMPARISON: FUND VS. INDEX.............................. 37
DECEMBER 31, 2016 ANNUAL REPORT
SHAREHOLDERS' LETTER -- (unaudited)
Dear Shareholders:
We are pleased to present this annual report for the SunAmerica Senior Floating
Rate Fund, Inc. (the "Fund") for the 12 months ended December 31, 2016.
Overall, 2016 could be described as a year of two halves. The first half
represented a market still very much dominated by risk aversion, while the
second half saw investors shift toward a more reflationary outlook. The S&P 500
Index,/1/ a measure of the broad U.S. equity market, ended the year with an
11.96% return, while the Bloomberg Barclays U.S. Aggregate Bond Index,/ 2/ a
measure of the broad U.S. fixed income market, returned 2.65% for the same
period.
It was a rough start to the calendar year for global financial markets, with
most asset classes experiencing steep price declines before staging impressive
retracements starting in mid-February 2016. In early January 2016, Chinese
stocks plunged, sparking a global risk-off trade. However, extended
accommodative monetary policy by major central banks helped support a rebound
in risk assets. The Bank of Japan (the "BoJ") followed the lead of central
banks in Europe by cutting its benchmark lending rate into negative territory
in January. The People's Bank of China lowered its reserve-requirement ratio,
the amount of cash banks must keep on reserve, in February in an effort to
boost economic growth. While European Central Bank (ECB) president Mario Draghi
had previously hinted that more stimulus was coming, he delivered at the ECB's
March meeting.
Risk assets remained resilient during the second calendar quarter, despite the
uncertainty about global economic growth prospects and the unexpected result of
the U.K. referendum, popularly known as Brexit, where following several decades
of close economic and social integration, the British electorate voted to leave
the European Union. The Brexit vote overshadowed a promising European economic
backdrop and the ECB's reaffirmation of its dovish policy stance, leading to a
steep, albeit short-lived, sell-off of risk assets globally. (Dovish policy
tends to suggest lower interest rates; opposite of hawkish.) In the U.S., solid
economic data helped investors shrug off not only the ripple effect of the
Brexit vote but also the U.S. Federal Reserve's (the "Fed") hawkish rhetoric
during May 2016. Market participants were also encouraged by improving signs
from China's economic data releases and its increased emphasis on currency
stability.
During the third quarter of 2016, expectations for continued accommodative
monetary policy from central banks around the globe helped stoke investors'
risk appetites. The Bank of England delivered a hefty stimulus package, which
helped counteract the Brexit shock and quell volatility across the major fixed
income asset classes. Its package included interest rate cuts, expanded
quantitative easing, and bank funding measures designed to promote domestic
lending. The BoJ announced a policy shift centered around yield curve control
and a commitment to overshoot inflation. More specifically, the BoJ would
target a 0% yield on the 10-year Japanese government bond. The Fed signaled a
higher probability of an interest rate hike before year end 2016. In turn,
credit spreads, or yield differentials of non-U.S. Treasury fixed income
sectors to U.S. Treasuries, tightened, and the U.S. dollar ended the third
calendar quarter mixed versus its major counterparts.
During the fourth quarter of 2016, stocks rallied following Donald Trump's
victory in the U.S. presidential election. Fixed income markets experienced
large losses in the final three months of 2016. Global sovereign yields
climbed, led by U.S. Treasuries, on expectations that Mr. Trump's fiscal
policies would prove expansionary, lifting inflation expectations. Optimism
that the policies of the incoming U.S. presidential administration and Congress
would emphasize tax reform and deregulation boosted credit markets, and spreads
tightened. On the monetary policy front, the Fed raised the targeted federal
funds rate by 25 basis points, a well-telegraphed move and only its second hike
in the last decade. (A basis point is 1/100/th/ of a percentage point.)
Amidst this backdrop, floating rate loans, as represented by the S&P/LSTA
Leveraged Loan Index (the "LLI"),/3/ returned 10.16% during the annual period
ended December 31, 2016, significantly outperforming the broad U.S. fixed
income market. Floating rate loans benefited during the annual period from
positive U.S. economic growth trends and strong demand for yield-producing
assets. Further, the underlying credit fundamentals of bank loan issuers
stabilized during the annual period. Although leverage ticked up slightly, this
was mitigated by historically strong interest coverage, which remained well
above long-term averages. Also, the trailing 12-month default rate for bank
loans, examined by principal amount, declined, ending
2
DECEMBER 31, 2016 ANNUAL REPORT
SHAREHOLDERS' LETTER -- (unaudited) (continued)
2016 at 1.49%, down from 1.69% at the end of 2015 and 3.24% at the end of 2014.
Excluding energy and metals and mining issuers, the trailing 12-month default
rate for bank loans was just 0.51%./4/
The sector's technicals, or supply and demand factors, were generally favorable
during the annual period, attributable primarily to the second half of the
year. Bank loan mutual funds experienced net outflows of $8.1 billion during
the first half of 2016, but then trends reversed, such that inflows more than
offset earlier year withdrawals. Indeed, bank loan mutual funds experienced
inflows of $10.8 billion in the fourth quarter of 2016 alone, following net
inflows for three consecutive months in the prior quarter. Similarly, through
the third quarter of 2016, issuance of collateralized loan obligations
("CLOs"), one of the main sources of demand for bank loans, remained behind
2015's pace, with $46 billion priced year-to-date through September 2016 versus
$79 billion at the same time in 2015. However, during the fourth quarter of
2016, CLO issuance became more active, as approximately $26 billion was issued
in the fourth quarter compared to $20 billion in the prior quarter./5/ In terms
of quality, as measured by the LLI, lower quality loans outperformed their
higher quality counterparts. For the annual period ended December 31, 2016,
loans rated CCC returned 29.05%, while loans rated BB returned 7.33%.
Industry performance within the LLI was generally strong during the annual
period. Virtually all of the industries within the LLI posted positive returns,
with the exception being home construction, which was weakest with a return of
-0.77% for the annual period. Paper (+1.37%), consumer cyclical (+5.43%) and
food and beverage (+5.54%) generated positive returns but were also among the
weakest performing industries during the annual period. The strongest
performing industries were energy (+40.74%), metal/mining (+34.65%) and
wireless (+14.31%).
On the following pages, you will find a brief discussion regarding the Fund's
annual results. You will also find detailed financial statements and portfolio
information for the Fund for the annual period ended December 31, 2016.
As always, we remain diligent in the management of your assets. If you have any
questions, or require additional information on this or other SunAmerica Funds,
we invite you to visit www.safunds.com or call the Shareholder Services
Department at 800-858-8850. We value your ongoing confidence in us and look
forward to serving your investment needs in the future.
Sincerely,
THE SUNAMERICA SENIOR FLOATING RATE FUND PORTFOLIO MANAGER
Jeffrey W. Heuer
Wellington Management Company LLP
--------
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
/1/The S&P 500 Index is Standard & Poor's 500 Composite Stock Price Index, a
widely recognized, unmanaged index of U.S. common stock prices.
/2/The Bloomberg Barclays U.S. Aggregate Bond Index represents securities that
are U.S. domestic, taxable and dollar denominated. The index covers components
for government and corporate securities, mortgage pass-through securities and
asset-backed securities.
/3/The S&P/LSTA Leveraged Loan Index (LLI) reflects the market-weighted
performance of U.S. dollar-denominated institutional leveraged loans. The LLI
is the only domestic leveraged loan index that utilizes real-time market
weightings, spreads and interest payments.
Indices are not managed and an investor cannot invest directly into an index.
/4/Source: JP Morgan.
/5/Source: S&P Leveraged Commentary & Data.
The Fund is not a money market fund and its net asset value may fluctuate.
Investments in loans involve certain risks including nonpayment of principal
and interest; collateral impairment; non-diversification and borrower industry
concentration; and lack of an active trading market, in certain cases, which
may impair the Fund's ability to obtain full value for loans sold. The Fund may
invest all or substantially all of its assets in loans or other securities
(e.g., unsecured loans or high yield securities) that are rated below
investment grade, or in comparable unrated securities. Credit risks include the
possibility of a default on the loan or bankruptcy of the borrower. The value
of these loans is subject to a greater degree of volatility in response to
interest rate fluctuations.
3
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
EXPENSE EXAMPLE -- DECEMBER 31, 2016 -- (UNAUDITED)
DISCLOSURE OF PORTFOLIO EXPENSES IN SHAREHOLDER REPORTS
As a shareholder of the SunAmerica Senior Floating Rate Fund, Inc. (the
"Fund"), you may incur two types of costs: (1) transaction costs, including
sales charges on purchase payments and contingent deferred sales charges and
(2) ongoing costs, including management fees, distribution and account
maintenance fees, and other Fund expenses. The example set forth below 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
July 1, 2016 and held until December 31, 2016.
ACTUAL EXPENSES
The "Actual" section of the table provides information about actual account
values and actual expenses. You may use the information in these columns,
together with the amount you invested, 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 in the column under the heading entitled "Expenses Paid During the Six
Months Ended December 31, 2016" to estimate the expenses you paid on your
account during this period. The "Expenses Paid During the Six Months Ended
December 31, 2016" column and the "Annualized Expense Ratio" column do not
include small account fees that may be charged if your account balance is below
$500 ($250 for retirement plan accounts). In addition, the "Expenses Paid
During the Six Months Ended December 31, 2016" column and the "Annualized
Expense Ratio" column do not include administrative or other fees that may
apply to qualified retirement plan accounts and accounts held through financial
institutions. See the Fund's prospectus, your retirement plan documents and/or
materials from your financial adviser, for a full description of these fees.
Had these fees been included, the "Expenses Paid During the Six Months Ended
December 31, 2016" column would have been higher and the "Ending Account Value"
column would have been lower.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The "Hypothetical" section of the table provides information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio and an annual rate of return of 5% before expenses, which is not the
Fund's actual return. The hypothetical account values and expenses may not be
used to estimate the actual ending account balance or expenses you paid for the
period. You may use this information to compare the ongoing costs of investing
in this Fund and other funds. To do so, compare this 5% hypothetical example
with the 5% hypothetical examples that appear in the shareholder reports of
other funds. The "Expenses Paid During the Six Months Ended December 31, 2016"
column and the "Annualized Expense Ratio" column do not include small account
fees that may be charged if your account balance is below $500 ($250 for
retirement plan accounts). In addition, the "Expenses Paid During the Six
Months Ended December 31, 2016" column and the "Annualized Expense Ratio"
column do not include administrative or other fees that may apply to qualified
retirement plan accounts and accounts held through financial institutions. See
the Fund's prospectus, your retirement plan document and/or materials from your
financial adviser for full description of these fees. Had these fees been
included, the "Expenses Paid During the Six Months Ended December 31, 2016"
column would have been higher and the "Ending Account Value" column would have
been lower.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transaction costs, including sales
charges on purchase payments, contingent deferred sales charges and
administrative fees, if applicable to your account. Please refer to the Fund's
prospectus, qualified retirement plan document and/or materials from your
financial adviser, for more information. Therefore, the "Hypothetical" example
is useful in comparing ongoing costs only and will not help you determine the
relative total costs of owning different funds. In addition, if these
transaction costs and other fees were included, your costs would have been
higher.
4
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
EXPENSE EXAMPLE -- DECEMBER 31, 2016 -- (UNAUDITED) (CONTINUED)
ACTUAL HYPOTHETICAL
---------------------------------------------- --------------------------------------------------
ENDING ENDING ACCOUNT
ACCOUNT VALUE EXPENSES PAID VALUE USING EXPENSES PAID
USING ACTUAL DURING THE A HYPOTHETICAL 5% DURING THE
BEGINNING RETURNS AT SIX MONTHS ENDED BEGINNING ANNUAL RETURN AT SIX MONTHS ENDED ANNUALIZED
ACCOUNT VALUE DECEMBER 31, DECEMBER 31, ACCOUNT VALUE DECEMBER 31, DECEMBER 31, EXPENSE
AT JULY 1, 2016 2016 2016* AT JULY 1, 2016 2016 2016* RATIO*
--------------- ------------- ---------------- --------------- ----------------- ---------------- ----------
Senior Floating
Rate Fund#
Class A.......... $1,000.00 $1,050.59 $7.47 $1,000.00 $1,017.85 $7.35 1.45%
Class C.......... $1,000.00 $1,049.06 $9.01 $1,000.00 $1,016.34 $8.87 1.75%
--------
* Expenses are equal to the Fund's annualized expense ratio multiplied by the
average account value over the period, multiplied by 184 days then divided
by 366 days (to reflect the one-half year period). These ratios do not
reflect transaction costs, including sales charges on purchase payments,
contingent deferred sales charges, small account fees and administrative
fees, if applicable to your account. Please refer to your Prospectus, your
qualified retirement plan document and/or materials from your financial
advisor for more information.
# During the stated period, the investment adviser either waived a portion of
or all of the fees and assumed a portion of or all expenses for the Fund. As
a result, if these fees and expenses had not been waived or assumed, the
"Actual/Hypothetical Ending Account Value" would have been lower and the
"Actual/Hypothetical Expenses Paid During the Six Months Ended December 31,
2016" and the "Annualized Expense Ratio" would have been higher.
5
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES -- DECEMBER 31, 2016
ASSETS:
Investments at value (unaffiliated)*............................................ $286,627,038
Repurchase agreements (cost approximates value)................................. 10,155,000
------------
Total investments.............................................................. 296,782,038
------------
Foreign cash*................................................................... 1,189,398
Receivable for:
Fund shares sold............................................................... 790,192
Dividends and interest......................................................... 1,710,236
Investments sold............................................................... 381,697
Investments sold on an extended settlement basis............................... 6,662,013
Prepaid expenses and other assets............................................... 6,088
Due from investment adviser for expense reimbursements/fee waivers.............. 197,225
------------
Total assets................................................................... 307,718,887
------------
LIABILITIES:
Payable for:
Fund shares redeemed........................................................... 422,242
Investments purchased on an extended settlement basis.......................... 19,134,250
Investment advisory and management fees........................................ 205,232
Distribution and account maintenance fees...................................... 137,279
Administration fees............................................................ 48,290
Transfer agent fees and expenses............................................... 57,940
Directors' fees and expenses................................................... 5,159
Other accrued expenses......................................................... 232,731
Dividends payable............................................................... 90,296
Commitments (Note 10)........................................................... 47,178
Unrealized depreciation on forward foreign currency contracts................... 10,024
------------
Total liabilities.............................................................. 20,390,621
------------
Net Assets................................................................... $287,328,266
============
NET ASSETS REPRESENTED BY:
Common stock, $.01 par value.................................................... $ 356,675
Additional paid-in capital...................................................... 343,857,109
------------
344,213,784
Accumulated undistributed net investment income (loss).......................... (60,351)
Accumulated undistributed net realized gain (loss) on investments and foreign
exchange transactions.......................................................... (47,863,848)
Unrealized appreciation (depreciation) on investments........................... (8,938,752)
Unrealized foreign exchange gain (loss) on other assets and liabilities......... (22,567)
------------
Net Assets................................................................... $287,328,266
============
CLASS A:
Net assets...................................................................... $131,640,404
Shares outstanding.............................................................. 16,335,097
Net asset value and redemption price per share.................................. $ 8.06
Maximum sales charge (3.75% of offering price).................................. 0.31
------------
Maximum offering price to public................................................ $ 8.37
============
CLASS C:
Net assets...................................................................... $155,687,862
Shares outstanding.............................................................. 19,332,368
Net asset value, offering and redemption price per share (excluding any
applicable contingent deferred sales charges).................................. $ 8.05
============
*COST
Investment securities (unaffiliated)........................................... $295,565,790
============
Foreign cash................................................................... $ 1,192,448
============
See Notes to Financial Statements
6
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
STATEMENT OF OPERATIONS -- For the year ended December 31, 2016
INVESTMENT INCOME:
Interest (unaffiliated)........................................................... $13,866,675
Dividends (unaffiliated).......................................................... 163,822
Facility and other fee income (Note 2)............................................ 796,488
-----------
Total investment income........................................................ $14,826,985
-----------
EXPENSES:
Investment advisory and management fees........................................... 2,326,374
Administration fees............................................................... 547,382
Distribution and account maintenance fees:
Class A......................................................................... 397,446
Class C......................................................................... 1,201,012
Transfer agent fees and expenses:
Class A......................................................................... 263,653
Class C......................................................................... 367,740
Registration fees:
Class A......................................................................... 21,164
Class C......................................................................... 15,986
Accounting service fees........................................................... 18,661
Custodian and accounting fees..................................................... 72,588
Reports to shareholders........................................................... 57,080
Audit and tax fees................................................................ 109,716
Legal fees........................................................................ 22,905
Directors' fees and expenses...................................................... 59,023
Other expenses.................................................................... 24,488
-----------
Total expenses before fee waivers and expense reimbursements................... 5,505,218
Fees waived and expenses reimbursed by investment adviser (Note 5)............. (1,056,293)
-----------
Net expenses................................................................... 4,448,925
-----------
Net investment income (loss)...................................................... 10,378,060
-----------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCIES:
Net realized gain (loss) on investments (unaffiliated)............................ (1,671,791)
Net realized foreign exchange gain (loss) on other assets and liabilities......... 4,276
-----------
Net realized gain (loss) on investments and foreign currencies.................... (1,667,515)
-----------
Change in unrealized appreciation (depreciation) on investments (unaffiliated).... 16,934,213
Change in unrealized foreign exchange gain (loss) on other assets and liabilities. (25,995)
-----------
Net unrealized gain (loss) on investments and foreign currencies.................. 16,908,218
-----------
Net realized and unrealized gain (loss) on investments and foreign currencies..... 15,240,703
-----------
INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS....................... $25,618,763
===========
See Notes to Financial Statements
7
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR FOR THE YEAR
ENDED ENDED
DECEMBER 31, DECEMBER 31,
2016 2015
------------ ------------
INCREASE (DECREASE) IN NET ASSETS:
OPERATIONS:
Net investment income (loss)......................................... $ 10,378,060 $ 13,385,770
Net realized gain (loss) on investments and foreign currencies....... (1,667,515) (5,284,060)
Net unrealized gain (loss) on investments and foreign currencies..... 16,908,218 (12,452,606)
------------ ------------
Net Increase (decrease) in net assets resulting from operations....... 25,618,763 (4,350,896)
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (Class A)...................................... (4,365,132) (5,793,773)
Net investment income (Class C)...................................... (5,735,535) (7,725,036)
------------ ------------
Total distributions to shareholders................................... (10,100,667) (13,518,809)
------------ ------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM CAPITAL SHARE
TRANSACTIONS (NOTE 3)................................................ (14,800,758) (63,659,281)
------------ ------------
TOTAL INCREASE (DECREASE) IN NET ASSETS............................... 717,338 (81,528,986)
NET ASSETS:
Beginning of period................................................... 286,610,928 368,139,914
------------ ------------
End of period+........................................................ $287,328,266 $286,610,928
============ ============
+Includes accumulated undistributed net investment income (loss)...... $ (60,351) $ (348,925)
============ ============
See Notes to Financial Statements
8
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
FINANCIAL HIGHLIGHTS
NET GAIN
(LOSS) ON
NET INVESTMENTS DIVIDENDS NET NET RATIO OF
ASSET (BOTH DIVIDENDS FROM NET ASSET ASSETS, EXPENSES
VALUE, NET REALIZED TOTAL FROM FROM NET REALIZED TOTAL VALUE, END OF TO AVERAGE
PERIOD BEGINNING INVESTMENT AND INVESTMENT INVESTMENT GAINS ON DISTRI- END OF TOTAL PERIOD NET
ENDED OF PERIOD INCOME(1) UNREALIZED) OPERATIONS INCOME INVESTMENTS BUTIONS PERIOD RETURN(2) (000'S) ASSETS(3)
---------- --------- ---------- ----------- ---------- ---------- ----------- ------- ------ --------- -------- ----------
CLASS A
-------
12/31/12 $7.96 $0.36 $ 0.31 $ 0.67 $(0.37) $ -- $(0.37) $8.26 8.51% $146,103 1.45%
12/31/13 8.26 0.33 0.08 0.41 (0.33) -- (0.33) 8.34 5.08 195,309 1.45
12/31/14 8.34 0.31 (0.29) 0.02 (0.31) -- (0.31) 8.05 0.20 150,966 1.45
12/31/15 8.05 0.33 (0.44) (0.11) (0.33) -- (0.33) 7.61 (1.42) 114,375 1.45
12/31/16 7.61 0.31 0.44 0.75 (0.30) -- (0.30) 8.06 10.08 131,640 1.45
CLASS C
-------
12/31/12 $7.95 $0.34 $ 0.30 $ 0.64 $(0.34) $ -- $(0.34) $8.25 8.20% $197,480 1.75%
12/31/13 8.25 0.30 0.10 0.40 (0.31) -- (0.31) 8.34 4.89 241,976 1.75
12/31/14 8.34 0.29 (0.30) (0.01) (0.28) -- (0.28) 8.05 (0.10) 217,174 1.75
12/31/15 8.05 0.31 (0.45) (0.14) (0.31) -- (0.31) 7.60 (1.85) 172,236 1.75
12/31/16 7.60 0.29 0.44 0.73 (0.28) -- (0.28) 8.05 9.76 155,688 1.75
RATIO OF
NET
INVESTMENT
INCOME TO
PERIOD AVERAGE PORTFOLIO
ENDED NET ASSETS(3) TURNOVER
---------- ------------- ---------
12/31/12 4.41% 61%
12/31/13 3.98 84
12/31/14 3.73 65
12/31/15 4.14 48
12/31/16 3.95 60
12/31/12 4.12% 61%
12/31/13 3.68 84
12/31/14 3.44 65
12/31/15 3.84 48
12/31/16 3.68 60
--------
(1)Calculated based upon average shares outstanding.
(2)Total return does not reflect sales load but does include expense
reimbursements.
(3)Net of the following expense waivers and/or reimbursements, if applicable
(based on average daily net assets) (see Note 5):
12/31/12 12/31/13 12/31/14 12/31/15 12/31/16
-------- -------- -------- -------- --------
Class A............. 0.35% 0.34% 0.32% 0.34% 0.33%
Class C............. 0.44 0.43 0.41 0.44 0.42
See Notes to Financial Statements
9
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
PORTFOLIO PROFILE -- DECEMBER 31, 2016 -- (UNAUDITED)
INDUSTRY ALLOCATION*
Media....................................................... 8.1%
Commercial Services & Supplies.............................. 8.0
Health Care Providers & Services............................ 6.7
Hotels, Restaurants & Leisure............................... 6.0
IT Services................................................. 5.8
Oil, Gas & Consumable Fuels................................. 5.0
Containers & Packaging...................................... 3.5
Repurchase Agreements....................................... 3.5
Food & Staples Retailing.................................... 3.3
Specialty Retail............................................ 3.3
Software.................................................... 3.0
Machinery................................................... 3.0
Diversified Telecommunication Services...................... 2.8
Food Products............................................... 2.5
Registered Investment Companies............................. 2.4
Chemicals................................................... 2.3
Insurance................................................... 2.2
Pharmaceuticals............................................. 2.0
Energy Equipment & Services................................. 1.8
Building Products........................................... 1.7
Capital Markets............................................. 1.6
Real Estate Management & Development........................ 1.6
Semiconductors & Semiconductor Equipment.................... 1.6
Health Care Equipment & Supplies............................ 1.5
Real Estate Investment Trusts............................... 1.4
Metals & Mining............................................. 1.4
Industrial Conglomerates.................................... 1.2
Construction Materials...................................... 1.0
Road & Rail................................................. 1.0
Life Sciences Tools & Services.............................. 0.9
Household Products.......................................... 0.9
Electric Utilities.......................................... 0.9
Professional Services....................................... 0.9
Aerospace & Defense......................................... 0.9
Household Durables.......................................... 0.8
Distributors................................................ 0.8
Health Care Technology...................................... 0.8
Internet & Direct Marketing Retail.......................... 0.7
Personal Products........................................... 0.6
Diversified Financial Services.............................. 0.6
Internet Software & Services................................ 0.5
Wireless Telecommunication Services......................... 0.5
Leisure Equipment & Products................................ 0.5
Industrial Power Producers & Energy Traders................. 0.5
Paper & Forest Products..................................... 0.5
Construction & Engineering.................................. 0.4
Multi Utilities............................................. 0.4
Banks....................................................... 0.4
Air Freight & Logistics..................................... 0.3
Electronic Equipment, Instruments & Components.............. 0.3
Consumer Finance............................................ 0.2
Electrical Equipment........................................ 0.2
Multiline Retail............................................ 0.2
Tech Hardware, Storage & Peripheral......................... 0.2
Airlines.................................................... 0.2
-----
103.3%
=====
CREDIT QUALITY+#
BBB-........................................................ 4.5%
BB+......................................................... 7.2
BB.......................................................... 13.4
BB-......................................................... 14.7
B+.......................................................... 22.1
B........................................................... 20.3
B-.......................................................... 6.2
CCC+........................................................ 7.8
CCC......................................................... 0.7
CCC-........................................................ 0.4
CC.......................................................... 0.3
C........................................................... 0.3
D........................................................... 0.8
Not Rated@ ................................................. 1.3
-----
100.0%
=====
--------
* Calculated as a percentage of net assets.
@ Represents debt issues that either have no rating, or the rating is
unavailable from the data source.
+ Source: Standard and Poor's
# Calculated as a percentage of total debt issues, excluding short-term
securities.
10
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
PORTFOLIO OF INVESTMENTS -- DECEMBER 31, 2016
RATINGS/(1)/
(UNAUDITED)
------------
INTEREST MATURITY PRINCIPAL VALUE
INDUSTRY DESCRIPTION TYPE MOODY'S S&P RATE DATE/(2)/ AMOUNT** (NOTE 2)
------------------------------------------------------------------------------------------------------------------------
LOANS(3)(4) -- 88.8%
AEROSPACE & DEFENSE -- 0.9%
Digital Globe, Inc.................................. BTL-B Ba3 BB+ 3.51% 12/16/2023 $1,005,000 $ 1,011,280
Transdigm Group, Inc................................ BTL-F Ba2 B 3.77 06/09/2023 1,405,142 1,418,022
-----------
2,429,302
-----------
AIR FREIGHT & LOGISTICS -- 0.3%
Air Medical Group Holdings LLC...................... BTL-B B2 B 4.25 04/06/2022 985,000 980,074
-----------
AIRLINES -- 0.2%
American Airlines, Inc.............................. BTL-B Ba1 BB+ 3.25 12/15/2023 420,000 421,705
-----------
BUILDING PRODUCTS -- 1.4%
84 Lumber Co........................................ BTL-B B1 B+ 6.75 10/04/2023 500,000 500,000
Beacon Roofing Supply, Inc.......................... BTL-B B2 BB+ 3.71-5.50 10/01/2022 1,103,850 1,111,439
HD Supply, Inc...................................... BTL-B B1 BB- 3.75 09/14/2023 1,346,625 1,354,031
Summit Materials LLC................................ BTL Ba3 BB 4.00 06/24/2022 935,750 941,891
-----------
3,907,361
-----------
CAPITAL MARKETS -- 1.6%
AlixPartners LLC.................................... BTL-B B2 B+ 4.00 07/28/2022 3,456,338 3,476,498
Russell Investments U.S. Institutional Holdco, Inc.. BTL Ba2 BB 6.75 06/01/2023 1,238,775 1,248,840
-----------
4,725,338
-----------
CHEMICALS -- 2.3%
Allnex (Lux) & Cy SCA............................... BTL-B2 B1 B+ 5.13 09/13/2023 614,410 618,250
Allnex USA, Inc..................................... BTL-B3 B1 B+ 5.13 09/13/2023 462,890 465,783
Chemours Co......................................... BTL-B Ba1 BB+ 3.77 05/22/2022 535,657 533,648
Gates Global, Inc................................... BTL B2 B+ 4.25 07/03/2021 1,367,141 1,366,927
Ineos U.S. Finance LLC.............................. BTL-B Ba3 BB- 3.75 05/04/2018 700,777 702,091
MacDermid, Inc...................................... BTL-B4 B2 BB- 5.00 10/06/2023 1,389,397 1,404,063
Minerals Technologies, Inc.......................... BTL-B Ba2 BB+ 3.75 05/09/2021 1,038,038 1,049,716
Univar, Inc......................................... BTL B2 BB- 4.25 06/30/2022 533,338 536,480
-----------
6,676,958
-----------
COMMERCIAL SERVICES & SUPPLIES -- 7.1%
ADS Waste Holdings, Inc............................. BTL B1 BB 3.50 10/26/2023 1,044,297 1,052,999
Audio Visual Services Group, Inc.................... BTL-B B1 B+ 4.50 01/24/2021 3,073,912 3,070,070
Berlin Packaging LLC................................ BTL B2 B 4.50 10/01/2021 498,732 502,941
Brand Energy and Infrastructure Services, Inc....... BTL-B B2 B 4.75 11/26/2020 2,351,630 2,328,953
Brickman Group Holdings, Inc........................ 1st Lien B2 B 4.00 12/18/2020 1,422,315 1,423,331
Brickman Group Holdings, Inc........................ 2nd Lien Caa1 CCC+ 7.50 12/18/2021 2,241,000 2,244,922
Camelot UK Holdco, Ltd.............................. BTL-B B2 BB- 4.75 09/07/2023 1,027,425 1,038,727
Casella Waste Systems, Inc.......................... BTL-B B1 B+ 4.00 10/03/2023 1,090,000 1,099,538
Fly Funding II SARL................................. BTL Ba3 BB+ 3.64 08/06/2019 1,260,391 1,268,659
KAR Auction Services, Inc........................... BTL-B3 Ba3 BB- 4.50 03/09/2023 560,763 568,123
Peak 10, Inc........................................ 2nd Lien Caa2 CCC+ 8.25 06/17/2022 845,000 783,738
Sedgwick CMS Holdings, Inc.......................... 2nd Lien Caa2 CCC+ 6.75 02/28/2022 1,465,000 1,459,506
ServiceMaster Co.................................... BTL-B Ba2 BB+ 3.27 11/03/2023 1,725,792 1,726,223
Vizient, Inc........................................ BTL-B2 B1 B+ 5.00 02/13/2023 888,651 900,870
Waste Industries USA, Inc........................... BTL-B B1 BB- 3.52 02/27/2020 1,021,800 1,024,674
-----------
20,493,274
-----------
CONSTRUCTION & ENGINEERING -- 0.3%
Pike Corp........................................... 1st Lien B1 BB 5.50 12/22/2021 962,323 964,728
-----------
11
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
PORTFOLIO OF INVESTMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
RATINGS/(1)/
(UNAUDITED)
------------
INTEREST MATURITY PRINCIPAL VALUE
INDUSTRY DESCRIPTION TYPE MOODY'S S&P RATE DATE/(2)/ AMOUNT** (NOTE 2)
-----------------------------------------------------------------------------------------------------------------------
CONSTRUCTION MATERIALS -- 1.0%
Headwaters, Inc...................................... BTL-B B1 BB- 4.00% 03/24/2022 $1,328,269 $1,333,250
Quikrete Companies, Inc.............................. 1st Lien B1 BB- 4.00 11/02/2023 1,460,000 1,472,471
----------
2,805,721
----------
CONSUMER FINANCE -- 0.2%
Vantiv LLC........................................... BTL-B Ba2 BBB- 3.25 06/13/2021 666,428 670,038
----------
CONTAINERS & PACKAGING -- 2.7%
Anchor Glass Container Corp.......................... 1st Lien B1 B 4.25 12/07/2023 155,000 156,163
Anchor Glass Container Corp.......................... 2nd Lien B3 CCC+ 8.75 12/07/2024 215,000 218,763
Ardagh Packaging Finance PLC......................... BTL Ba3 B+ 4.00 12/17/2019 609,059 615,150
Berry Plastics Holding Corp.......................... BTL-H Ba3 BB 3.75 10/01/2022 2,733,926 2,756,481
Hilex Poly Co. LLC................................... 1st Lien B1 B 4.25 12/13/2023 1,550,000 1,563,563
Mauser Holding GmbH.................................. 2nd Lien Caa2 CCC+ 8.75 07/31/2022 1,605,000 1,594,299
ProAmpac PG Borrower LLC............................. 1st Lien B2 B 5.00 11/18/2023 575,000 580,571
ProAmpac PG Borrower LLC............................. 2nd Lien Caa2 CCC+ 9.50 10/21/2024 385,000 386,283
----------
7,871,273
----------
DISTRIBUTORS -- 0.8%
ABC Supply Co., Inc.................................. BTL-B B1 BB+ 3.52 09/23/2023 2,160,474 2,179,378
----------
DIVERSIFIED FINANCIAL SERVICES -- 0.5%
Media General, Inc................................... BTL-B Ba3 BB+ 4.00 07/31/2020 783,574 783,364
TransUnion LLC....................................... BTL B1 BB- 3.52 04/09/2021 515,780 519,004
----------
1,302,368
----------
DIVERSIFIED TELECOMMUNICATION SERVICES -- 2.4%
Level 3 Financing, Inc............................... BTL-B Ba1 BBB- 3.50 05/04/2022 765,000 771,216
Level 3 Financing, Inc............................... BTL-B2 Ba1 BBB- 4.00 08/01/2019 925,000 934,019
Numericable Finance & Co. SCA........................ BTL-B10 B1 B+ 4.04 01/13/2025 1,185,000 1,194,628
Numericable Finance & Co. SCA........................ BTL-B B1 B+ 5.14 01/15/2024 422,875 426,258
Telenet International Finance SARL................... BTL B1 B+ 3.70 01/31/2025 1,815,000 1,825,587
UPC Financing Partnership............................ BTL Ba3 BB 4.08 08/31/2024 1,000,000 1,009,500
XO Communications, Inc............................... BTL B2 BB- 4.25 03/19/2021 853,779 854,313
----------
7,015,521
----------
ELECTRIC UTILITIES -- 0.5%
Vistra Operations Co. LLC............................ BTL-B2 Ba2 BB+ 4.00 12/06/2023 295,000 298,411
Vistra Operations Co. LLC............................ BTL Ba2 BB+ 5.00 08/04/2023 1,010,000 1,017,575
Vistra Operations Co. LLC............................ BTL-C Ba2 BB+ 5.00 08/04/2023 235,286 237,970
----------
1,553,956
----------
ELECTRICAL EQUIPMENT -- 0.2%
WireCo WorldGroup, Inc............................... 1st Lien B3 B+ 6.50 07/13/2023 623,438 627,074
----------
ELECTRONIC EQUIPMENT, INSTRUMENTS & COMPONENTS -- 0.3%
Dell, Inc............................................ BTL-B Baa3 BBB- 4.02 09/07/2023 500,000 508,125
Ortho Clinical Diagnostics SA........................ BTL B1 B- 4.75 06/30/2021 467,799 463,560
----------
971,685
----------
ENERGY EQUIPMENT & SERVICES -- 1.6%
Drillships Financing Holding, Inc.(5)................ BTL-B Caa2 CCC- 5.50 07/25/2021 981,420 767,961
Pacific Drilling SA.................................. BTL-B Caa3 CCC 4.50 06/04/2018 805,775 286,050
Paragon Offshore, Ltd.(7)............................ BTL-B WR NR 5.50 07/18/2021 987,500 352,209
Pinnacle Holdco SARL................................. BTL B3 B- 4.75 07/30/2019 1,009,571 777,370
Seadrill Partners Finco LLC.......................... BTL-B Caa2 CCC+ 4.00 02/21/2021 2,140,588 1,459,168
Shelf Drilling Midco, Ltd.(5)........................ BTL Caa3 C 10.00 10/08/2018 1,240,000 877,300
----------
4,520,058
----------
12
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
PORTFOLIO OF INVESTMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
RATINGS/(1)/
(UNAUDITED)
------------
INTEREST MATURITY PRINCIPAL VALUE
INDUSTRY DESCRIPTION TYPE MOODY'S S&P RATE DATE/(2)/ AMOUNT** (NOTE 2)
-----------------------------------------------------------------------------------------------------------------
FOOD & STAPLES RETAILING -- 3.3%
Albertson's Holdings LLC..................... BTL-B4 Ba2 BB 3.77% 08/22/2021 $3,218,433 $ 3,251,624
BJ's Wholesale Club, Inc..................... 1st Lien B3 B- 4.50 09/26/2019 1,037,658 1,046,089
Rite Aid Corp................................ BTL B2 BB- 4.88 06/21/2021 2,230,000 2,234,645
Rite Aid Corp................................ 2nd Lien B2 BB- 5.75 08/21/2020 1,055,000 1,058,627
U.S. Foods, Inc.............................. BTL B1 BB- 3.77 06/27/2023 1,905,214 1,922,226
-----------
9,513,211
-----------
FOOD PRODUCTS -- 2.1%
B&G Foods, Inc............................... BTL-B Ba3 BB+ 3.75 10/07/2022 900,421 908,075
Hearthside Food Solutions LLC................ BTL B1 B 4.50 06/02/2021 1,701,375 1,709,882
Hostess Brands, Inc.......................... BTL-B B1 BB- 4.00 08/03/2022 2,095,860 2,118,129
Oak Tea, Inc................................. BTL-B Ba3 BB 3.25 07/23/2021 668,913 670,585
Pinnacle Operating Corp.(5).................. BTL-B2 Ca CCC 4.75 11/15/2018 733,869 609,111
-----------
6,015,782
-----------
HEALTH CARE EQUIPMENT & SUPPLIES -- 1.5%
Alere, Inc................................... BTL-B Ba3 BB- 4.25 06/03/2022 1,298,825 1,294,651
Immucor, Inc................................. BTL-B2 B2 B- 5.00 08/17/2018 1,789,531 1,726,003
Sterigenics-Nordion Holdings LLC............. BTL-B B1 B 4.25 04/27/2022 1,165,250 1,168,891
-----------
4,189,545
-----------
HEALTH CARE PROVIDERS & SERVICES -- 6.3%
American Renal Holdings, Inc................. 1st Lien B2 B+ 4.75 09/22/2019 1,117,716 1,116,319
CHS/Community Health Systems, Inc............ BTL-F Ba3 BB- 3.86-4.19 12/31/2018 1,698,176 1,668,193
CHS/Community Health Systems, Inc............ BTL-H Ba3 BB- 4.00 01/27/2021 1,076,967 1,038,695
Envision Healthcare Corp..................... BTL-B Ba3 BB- 4.00 11/09/2023 2,764,213 2,781,489
Genoa, a QoL Healthcare Co. LLC.............. 1st Lien B1 B 4.75 10/25/2023 937,650 942,338
Genoa, a QoL Healthcare Co. LLC.............. 2nd Lien Caa1 CCC+ 9.00 10/25/2024 500,000 497,500
Healogics, Inc............................... 1st Lien B2 B 5.25 07/01/2021 987,961 908,924
Inventiv Health, Inc......................... BTL-B B2 B 4.75 09/28/2023 2,945,000 2,947,300
MPH Acquisition Holdings LLC................. BTL-B B1 B+ 5.00 06/07/2023 2,751,383 2,797,568
Opal Acquisition, Inc........................ BTL-B B2 B- 5.00 11/27/2020 600,345 563,574
Surgery Center Holdings, Inc................. 1st Lien B2 B 4.75 07/09/2020 1,205,407 1,211,058
U.S. Renal Care, Inc......................... BTL-B B1 B 5.25 11/06/2022 1,769,613 1,648,690
-----------
18,121,648
-----------
HEALTH CARE TECHNOLOGY -- 0.8%
Emdeon, Inc.................................. BTL-2 Ba3 BB- 3.75 11/02/2018 1,190,170 1,191,905
IMS Health, Inc.............................. BTL-B Ba1 BBB- 3.50 03/17/2021 974,221 979,904
-----------
2,171,809
-----------
HOTELS, RESTAURANTS & LEISURE -- 5.5%
Affinity Gaming LLC.......................... BTL B1 B+ 5.00 07/01/2023 636,800 640,780
Aristocrat Technologies, Inc................. BTL-B1 Ba1 BB 3.63 10/20/2021 939,843 948,771
Boyd Gaming Corp............................. BTL-B2 Ba3 BB 3.76 09/15/2023 1,047,375 1,056,322
Caesars Entertainment Operating Co., Inc.(7). BTL-B6 WR D 1.50 03/01/2017 1,910,401 2,106,218
Caesars Growth Properties Holdings LLC....... BTL B3 B+ 6.25 05/08/2021 1,070,423 1,078,117
CityCenter Holdings LLC...................... BTL-B B1 BB 4.25 10/16/2020 913,243 921,615
Eldorado Resorts LLC......................... BTL-B Ba3 BB- 4.25 07/13/2022 965,300 973,746
Four Seasons Holdings, Inc................... 1st Lien WR BB 4.00 06/27/2020 620,000 616,941
Hilton Worldwide Finance LLC................. BTL-B2 Ba1 BBB- 3.26 10/26/2023 1,325,315 1,338,806
La Quinta Intermediate Holdings LLC.......... BTL-B B1 BB 3.75 04/14/2021 885,164 884,887
Lindblad Expeditons, Inc..................... BTL B2 BB 5.82 06/17/2022 225,141 225,703
Lindblad Expeditons, Inc..................... CTL B2 BB 5.82 06/17/2022 1,744,859 1,749,222
Scientific Games International, Inc.......... BTL-B2 Ba3 B+ 6.00 10/01/2021 565,938 572,406
Station Casinos, Inc......................... BTL-B Ba3 BB 3.75 06/08/2023 875,600 885,040
Town Sports International Holdings, Inc...... BTL Caa2 CCC+ 4.50 11/15/2020 2,211,980 1,791,704
-----------
15,790,278
-----------
13
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
PORTFOLIO OF INVESTMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
RATINGS/(1)/
(UNAUDITED)
------------
INTEREST MATURITY PRINCIPAL VALUE
INDUSTRY DESCRIPTION TYPE MOODY'S S&P RATE DATE/(2)/ AMOUNT** (NOTE 2)
----------------------------------------------------------------------------------------------------------------------
HOUSEHOLD DURABLES -- 0.8%
Wilsonart LLC..................................... BTL B2 B+ 4.50% 12/12/2023 $2,300,000 $ 2,320,125
-----------
HOUSEHOLD PRODUCTS -- 0.9%
Reynolds Group Holdings, Inc...................... BTL B2 B+ 4.25 02/05/2023 2,628,413 2,655,293
-----------
INDUSTRIAL CONGLOMERATES -- 1.2%
American Rock Salt Co. LLC........................ BTL-B B2 B 4.75 05/20/2021 1,735,500 1,711,637
American Rock Salt Co. LLC........................ 2nd Lien B2 B 4.75 05/20/2021 979,868 977,418
Utex Industries, Inc.............................. 1st Lien Caa1 CCC+ 5.00 05/22/2021 822,890 757,059
-----------
3,446,114
-----------
INDUSTRIAL POWER PRODUCERS & ENERGY TRADERS -- 0.3%
Calpine Corp...................................... BTL-B7 Ba2 BB 3.75 05/05/2023 864,403 868,365
-----------
INSURANCE -- 2.2%
Asurion Corp...................................... BTL-B B1 B+ 4.02 07/08/2020 366,070 367,443
Asurion Corp...................................... BTL-B5 B1 B+ 4.75 10/27/2023 1,406,475 1,421,595
Asurion Corp...................................... BTL-B4 B1 B+ 5.00 07/22/2022 992,947 1,002,628
Asurion Corp...................................... 2nd Lien Caa1 CCC+ 8.50 03/03/2021 1,905,000 1,927,860
Compass Investments, Inc.......................... BTL B1 B 4.25 12/27/2019 1,185,021 1,188,477
NFP Corp.(18)..................................... BTL-B B1 B+ 4.50 12/09/2023 435,000 438,806
-----------
6,346,809
-----------
INTERNET & DIRECT MARKETING RETAIL -- 0.7%
Acosta, Inc....................................... BTL B1 B 4.25 09/26/2021 1,352,374 1,316,310
Lands' End, Inc................................... BTL-B B2 B- 4.25 04/04/2021 933,633 695,556
-----------
2,011,866
-----------
INTERNET SOFTWARE & SERVICES -- 0.5%
GTT Communications, Inc........................... BTL-B B1 B+ 5.00 09/12/2023 595,000 602,438
Zayo Group LLC.................................... BTL-B Ba2 BB- 3.75 07/02/2019 886,305 893,876
-----------
1,496,314
-----------
IT SERVICES -- 5.2%
Ceridian Corp..................................... BTL-B2 Ba3 B- 4.50 09/15/2020 762,066 752,222
Conduent, Inc..................................... BTL-B Ba2 BB+ 6.25 12/07/2023 1,780,000 1,800,025
Evo Payments International........................ 1st Lien B1 B 6.00 11/15/2023 1,620,000 1,625,399
Evo Payments International........................ 2nd Lien Caa1 B- 10.00 11/15/2024 645,000 641,775
First Data Corp................................... BTL-C Ba3 BB 3.76 03/04/2022 3,404,904 3,436,825
First Data Corp................................... BTL Ba3 BB 3.76 07/10/2022 3,381,956 3,417,467
Global Payments, Inc.............................. BTL-B Ba2 BBB- 3.27 10/19/2022 258,867 260,916
WEX, Inc.......................................... BTL-B Ba3 BB- 4.27 07/01/2023 2,880,525 2,913,447
-----------
14,848,076
-----------
LEISURE EQUIPMENT & PRODUCTS -- 0.5%
SRAM LLC.......................................... BTL-B B2 B 4.00-5.75 04/10/2020 1,480,439 1,469,335
-----------
LIFE SCIENCES TOOLS & SERVICES -- 0.9%
Pharmaceutical Product Development, Inc........... BTL-B B1 B 4.25 07/24/2022 2,685,410 2,709,466
-----------
MACHINERY -- 3.0%
Gardner Denver, Inc............................... BTL B2 B 4.25-4.57 07/30/2020 1,861,181 1,839,079
Harbor Freight Tools USA, Inc..................... BTL-B Ba3 BB- 3.89 08/05/2023 1,717,473 1,737,062
Harsco Corp....................................... BTL-B Ba1 BB 6.00 10/21/2023 1,130,000 1,149,775
Outerwall, Inc.................................... 1st Lien B1 B 5.25-7.00 09/21/2023 1,591,013 1,607,586
Outerwall, Inc.................................... 2nd Lien Caa1 CCC+ 9.75 09/21/2024 685,000 690,138
Paladin Brands Holding, Inc.(5)................... BTL B3 B+ 7.25 08/16/2019 1,647,179 1,509,228
-----------
8,532,868
-----------
14
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
PORTFOLIO OF INVESTMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
RATINGS/(1)/
(UNAUDITED)
------------
INTEREST MATURITY PRINCIPAL VALUE
INDUSTRY DESCRIPTION TYPE MOODY'S S&P RATE DATE/(2)/ AMOUNT** (NOTE 2)
------------------------------------------------------------------------------------------------------------------
MEDIA -- 7.9%
Advantage Sales & Marketing LLC............... 1st Lien B1 B 4.25% 07/25/2021 $1,967,755 $ 1,968,739
Advantage Sales & Marketing LLC............... 2nd Lien Caa1 CCC+ 7.50 07/25/2022 1,000,000 973,333
CBS Radio, Inc................................ BTL-B Ba3 BB- 4.50 10/06/2023 570,566 576,094
Charter Communications Operating LLC.......... BTL NR BBB- 3.25 01/15/2024 1,071,900 1,078,935
CSC Holdings, Inc............................. BTL Ba1 BB- 3.88 10/11/2024 1,013,158 1,023,289
Delta 2 (Lux) SARL............................ BTL-B3 B2 B 5.07 07/31/2021 3,944,124 3,980,043
Delta 2 (Lux) SARL............................ 2nd Lien Caa2 CCC+ 8.07 07/31/2022 1,495,000 1,503,970
Galleria Co................................... BTL-B Ba1 BBB- 3.75 01/26/2023 995,000 997,902
Getty Images, Inc............................. BTL-B B3 CCC+ 4.75 10/18/2019 1,826,125 1,591,011
Hicks Sports Group+(7)(9)..................... BTL-B NR NR 6.75 12/22/2011 964,156 28,925
ION Media Networks, Inc....................... BTL-B2 B1 B+ 4.50 12/18/2020 2,662,221 2,667,766
Mission Broadcasting, Inc.(18)................ BTL-B2 Ba3 BB+ 3.75 09/26/2023 80,000 80,600
Nexstar Broadcasting, Inc.(18)................ BTL-B Ba3 BB+ 3.75 09/21/2023 880,000 886,600
Salem Communications Corp.(5)................. BTL-B B2 B- 4.50 03/16/2020 370,217 360,498
Univision Communications, Inc................. BTL-C4 B2 B+ 4.00 03/01/2020 2,926,824 2,938,614
Virgin Media Investments, Ltd................. BTL-I Ba3 BB- 3.52 01/31/2025 2,080,000 2,087,800
-----------
22,744,119
-----------
METALS & MINING -- 1.1%
Ameriforge Group, Inc......................... BTL Caa2 CCC 5.00 12/19/2019 914,780 476,829
Crosby Worldwide, Ltd......................... 1st Lien Caa1 B- 4.00 11/18/2020 1,024,242 915,843
Fortescue Metals Group, Ltd................... BTL Ba1 BBB- 3.75 06/30/2019 210,277 210,540
Signode Industrial Group U.S., Inc............ BTL-B B1 B 4.00 04/08/2021 1,434,611 1,439,094
-----------
3,042,306
-----------
MULTI UTILITIES -- 0.4%
Energy Future Intermediate Holding Co. LLC(7). DIP NR NR 4.25 06/30/2017 1,215,000 1,221,986
-----------
MULTILINE RETAIL -- 0.2%
Neiman Marcus Group, Inc...................... BTL-B B2 B- 4.25 10/25/2020 677,281 588,619
-----------
OIL, GAS & CONSUMABLE FUELS -- 4.0%
American Energy Marcellus LLC(19)............. 1st Lien Ca CC 5.25 08/04/2020 1,565,000 852,925
Arch Coal, Inc.(7)............................ BTL NR NR 10.00 06/15/2021 296,049 299,997
California Resources Corp..................... 2nd Lien Caa1 B 11.38 08/04/2021 1,315,000 1,458,006
Chesapeake Energy Corp........................ BTL B3 B 8.50 08/23/2021 880,000 956,633
Chief Exploration & Development LLC(5)........ 2nd Lien NR NR 7.75 05/12/2021 1,785,000 1,744,838
Energy Transfer Equity LP..................... BTL Ba2 BB 4.14 12/02/2019 929,412 931,880
MEG Energy Corp............................... BTL B3 BB+ 4.54 03/31/2020 748,032 721,384
Philadelphia Energy Solutions LLC(5).......... BTL-B B3 B+ 6.25 04/04/2018 919,188 758,330
Power Buyer LLC............................... BTL B2 B+ 4.25 05/06/2020 1,031,163 1,028,585
Power Buyer LLC(5)............................ 2nd Lien Caa2 CCC+ 8.25 11/06/2020 670,000 666,650
Western Refining LP........................... BTL-B B1 B+ 5.25 11/12/2020 2,109,726 2,118,956
-----------
11,538,184
-----------
PAPER & FOREST PRODUCTS -- 0.3%
Exopack LLC................................... BTL B2 B 4.50 05/08/2019 763,984 767,327
-----------
PERSONAL PRODUCTS -- 0.4%
Revlon Consumer Products Corp................. BTL-B Ba3 B+ 4.27-4.44 07/22/2023 1,097,250 1,106,577
-----------
PHARMACEUTICALS -- 1.8%
Catalent Pharma Solutions, Inc................ BTL-B2 Ba3 BB 3.75 05/20/2021 1,412,135 1,420,667
Endo Luxembourg Finance Co.................... BTL-B Ba2 BB 3.81 06/11/2022 2,173,050 2,179,163
Valeant Pharmaceuticals International, Inc.... BTL-F1 Ba3 BB- 5.50 03/13/2022 1,684,820 1,685,031
-----------
5,284,861
-----------
15
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
PORTFOLIO OF INVESTMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
RATINGS/(1)/
(UNAUDITED)
------------
INTEREST MATURITY PRINCIPAL VALUE
INDUSTRY DESCRIPTION TYPE MOODY'S S&P RATE DATE/(2)/ AMOUNT** (NOTE 2)
---------------------------------------------------------------------------------------------------------------------------
PROFESSIONAL SERVICES -- 0.9%
Nexeo Solutions LLC............................ BTL-B B3 B 5.25% 06/09/2023 $1,626,825 $ 1,638,348
On Assignment, Inc............................. BTL-B Ba2 BB 3.52 06/03/2022 856,030 864,056
------------
2,502,404
------------
REAL ESTATE INVESTMENT TRUSTS -- 1.4%
Capital Automotive LP.......................... 2nd Lien B1 B- 6.00 04/30/2020 1,405,000 1,412,903
Equinix, Inc................................... BTL-B Ba2 BBB- 3.25 12/09/2023 EUR 1,130,000 1,196,929
MGM Growth Properties LLC...................... BTL B1 BB+ 3.52 04/01/2023 1,493,713 1,504,449
------------
4,114,281
------------
REAL ESTATE MANAGEMENT & DEVELOPMENT -- 1.6%
DTZ US Borrower LLC............................ 1st Lien B1 B+ 4.25 11/04/2021 3,306,608 3,314,186
DTZ US Borrower LLC............................ 2nd Lien B3 B- 9.25 11/05/2022 92,340 92,264
Realogy Corp................................... BTL-B Ba1 BB+ 3.77 07/14/2022 1,113,098 1,131,186
------------
4,537,636
------------
ROAD & RAIL -- 1.0%
Kenan Advantage Group, Inc.(5)(8).............. Delayed Draw B1 B+ 1.50 01/23/2017 47,178 47,134
Kenan Advantage Group, Inc.(17)................ BTL B1 B+ 4.00 07/31/2022 728,333 728,333
Kenan Advantage Group, Inc..................... BTL-B B1 B+ 4.00 07/31/2022 223,517 223,517
Neff Rental LLC(5)............................. 2nd Lien B3 B- 7.54 06/09/2021 1,770,294 1,755,910
------------
2,754,894
------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT -- 1.3%
Avago Technologies, Ltd........................ BTL-B3 Ba1 BBB- 3.70 02/01/2023 1,035,997 1,049,918
Lattice Semiconductor Corp..................... 1st Lien B2 B 5.51 03/04/2021 829,515 827,441
NXP BV......................................... BTL-F Baa2 BBB- 3.27 12/07/2020 797,595 801,209
ON Semiconductor Corp.......................... BTL Ba1 BB 4.02 03/31/2023 997,500 1,008,583
------------
3,687,151
------------
SOFTWARE -- 2.7%
Epicore Software Co............................ 1st Lien B2 B- 4.75 05/08/2022 1,019,330 1,022,133
Lawson Software, Inc........................... BTL-B5 B1 B+ 3.75 06/03/2020 919,755 919,883
Magic Newco LLC................................ BTL B1 B+ 5.00 12/12/2018 2,050,633 2,060,519
Oberthur Technologies SA....................... BTL-B2 B2 B- 1.88 12/14/2023 960,000 967,200
Oberthur Technologies SA....................... BTL B2 B- 4.70 12/14/2023 595,000 599,463
RP Crown Parent LLC............................ BTL-B B1 B 4.50 09/22/2023 890,000 893,709
SS&C Technologies, Inc......................... BTL-B1 Ba3 BB+ 4.00-4.02 06/23/2022 1,277,273 1,292,555
SS&C Technologies, Inc......................... BTL-B2 Ba3 BB+ 4.00-4.02 06/23/2022 130,240 131,798
------------
7,887,260
------------
SPECIALTY RETAIL -- 3.1%
At Home Holding III, Inc....................... BTL B2 B 5.00 05/11/2022 1,424,987 1,424,987
Bass Pro Group LLC............................. BTL-B B1 B+ 5.97 11/14/2023 3,990,000 3,952,239
J Crew Operating Corp.......................... BTL-B1 Caa1 CCC- 4.00 03/05/2021 737,525 410,402
Michaels Stores, Inc........................... BTL-B2 Ba2 BB 3.75 01/27/2023 980,698 989,805
Party City Holdings, Inc....................... BTL B1 B+ 3.82-4.24 08/19/2022 914,189 919,189
PetSmart, Inc.................................. BTL-B2 Ba3 BB- 4.00 03/10/2022 1,076,174 1,079,476
------------
8,776,098
------------
TECH HARDWARE, STORAGE & PERIPHERAL -- 0.2%
CDW Corp....................................... BTL-B Ba1 BBB- 3.00 08/04/2023 461,994 464,376
------------
WIRELESS TELECOMMUNICATION SERVICES -- 0.5%
LTS Buyer LLC.................................. BTL-B B1 B 4.25 04/11/2020 1,482,642 1,492,836
------------
TOTAL LOANS (cost $259,566,541)................ 255,133,631
------------
16
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
PORTFOLIO OF INVESTMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
RATINGS/(1)/
(UNAUDITED)
------------
INTEREST MATURITY PRINCIPAL VALUE
INDUSTRY DESCRIPTION TYPE MOODY'S S&P RATE DATE/(2)/ AMOUNT** (NOTE 2)
---------------------------------------------------------------------------------------------------------------------------------
U.S. CORPORATE BONDS & NOTES -- 5.0%
BUILDING PRODUCTS -- 0.3%
FBM Finance, Inc.*.................................. Sec. Notes Caa1 B+ 8.25% 08/15/2021 $ 516,000 $ 544,380
Standard Industries, Inc.*.......................... Senior Notes Ba2 BBB- 5.13 02/15/2021 420,000 437,850
----------
982,230
----------
COMMERCIAL SERVICES & SUPPLIES -- 0.9%
ACCO Brands Corp.*.................................. Company Guar. Notes B1 BB- 5.25 12/15/2024 500,000 503,439
Reynolds Group Issuer, Inc. FRS*.................... Senior Sec. Notes B2 B+ 4.38 07/15/2021 1,245,000 1,273,012
Reynolds Group Issuer, Inc.*........................ Senior Sec. Notes B2 B+ 5.13 07/15/2023 500,000 510,624
Reynolds Group Issuer, Inc.*........................ Company Guar. Notes Caa2 B- 7.00 07/15/2024 390,000 414,618
----------
2,701,693
----------
CONSTRUCTION & ENGINEERING -- 0.1%
Beazer Homes, Inc.*................................. Company Guar. Notes B3 B- 8.75 03/15/2022 331,000 357,480
----------
FOOD PRODUCTS -- 0.4%
Post Holdings, Inc.*................................ Company Guar. Notes B3 B 5.00 08/15/2026 750,000 718,124
TreeHouse Foods, Inc.*.............................. Senior Notes Ba3 BB 6.00 02/15/2024 500,000 525,000
----------
1,243,124
----------
HEALTH CARE PROVIDERS & SERVICES -- 0.4%
MPH Acquisition Holdings LLC*....................... Senior Notes Caa1 B- 7.13 06/01/2024 265,000 278,939
Tenet Healthcare Corp............................... Senior Notes Caa1 CCC+ 8.13 04/01/2022 1,035,000 976,523
----------
1,255,462
----------
HOTELS, RESTAURANTS & LEISURE -- 0.2%
Boyd Gaming Corp.*.................................. Company Guar. Notes B3 B 6.38 04/01/2026 435,000 468,495
----------
INDUSTRIAL POWER PRODUCERS & ENERGY TRADERS -- 0.2%
Dynegy Finance, Inc................................. Senior Sec. Notes B3 B+ 6.75 11/01/2019 500,000 508,750
----------
IT SERVICES -- 0.6%
First Data Corp.*................................... Company Guar. Notes B3 B 7.00 12/01/2023 1,500,000 1,597,500
----------
MEDIA -- 0.2%
Gray Television, Inc.*.............................. Company Guar. Notes B2 B+ 5.88 07/15/2026 475,000 471,438
----------
METALS & MINING -- 0.1%
Novelis Corp.*...................................... Senior Notes B2 B 6.25 08/15/2024 210,000 222,600
----------
MULTI UTILITIES -- 0.0%
Texas Competitive Electric Holdings Co. LLC*(5)(12). Escrow Notes NR NR 6.25 10/01/2020 4,174,956 41,750
----------
OIL, GAS & CONSUMABLE FUELS -- 0.4%
Diamondback Energy, Inc.*........................... Company Guar. Notes B1 BB- 4.75 11/01/2024 225,000 220,500
SM Energy Co........................................ Senior Notes B3 B+ 6.75 09/15/2026 670,000 690,100
WPX Energy, Inc..................................... Senior Notes B3 B 5.25 09/15/2024 315,000 305,550
----------
1,216,150
----------
PAPER & FOREST PRODUCTS -- 0.2%
Boise Cascade Co.*.................................. Senior Notes B1 BB- 5.63 09/01/2024 500,000 496,250
----------
PERSONAL PRODUCTS -- 0.2%
Revlon Consumer Products Corp....................... Company Guar. Notes B3 B 6.25 08/01/2024 655,000 671,375
----------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT -- 0.3%
Micron Technology, Inc.*............................ Senior Sec. Notes Baa2 BBB- 7.50 09/15/2023 685,000 758,638
----------
SOFTWARE -- 0.3%
Infor Software Parent LLC*(11)...................... Company Guar. Notes Caa2 CCC+ 7.13 05/01/2021 330,000 339,900
JDA Escrow/JDA Bond Finance*........................ Senior Sec. Notes Caa1 CCC+ 7.38 10/15/2024 400,000 415,000
----------
754,900
----------
17
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
PORTFOLIO OF INVESTMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
RATINGS/(1)/
(UNAUDITED) PRINCIPAL
------------ AMOUNT**/
INTEREST MATURITY
INDUSTRY DESCRIPTION TYPE MOODY'S S&P RATE DATE/(2)/
-----------------------------------------------------------------------------------------------------------------
SPECIALTY RETAIL -- 0.2%
Party City Holdings, Inc.*.............................. Company Guar. Notes B3 B- 6.13% 08/15/2023 $ 500,000
TOTAL U.S. CORPORATE BONDS & NOTES (cost $13,879,409)...
FOREIGN CORPORATE BONDS & NOTES -- 2.5%
CONTAINERS & PACKAGING -- 0.8%
ARD Finance SA*(11)..................................... Senior Sec. Notes Caa2 CCC+ 7.13 09/15/2023 575,000
Ardagh Packaging Finance PLC FRS*....................... Senior Sec. Notes Ba3 B+ 4.16 05/15/2021 1,000,000
Ardagh Packaging Finance PLC*........................... Company Guar. Notes B3 CCC+ 7.25 05/15/2024 685,000
DIVERSIFIED FINANCIAL SERVICES -- 0.1%
Tervita Escrow Corp.*................................... Senior Sec. Notes B2 B- 7.63 12/01/2021 305,000
DIVERSIFIED TELECOMMUNICATION SERVICES -- 0.4%
Altice Financing SA*.................................... Senior Sec. Notes B1 BB- 6.50 01/15/2022 500,000
Numericable SFR SA*..................................... Senior Sec. Notes B1 B+ 7.38 05/01/2026 680,000
ENERGY EQUIPMENT & SERVICES -- 0.2%
Shelf Drilling Holdings, Ltd.*(5)....................... Senior Sec. Notes B2 CCC 8.63 11/01/2018 695,000
HOTELS, RESTAURANTS & LEISURE -- 0.3%
Codere Finance 2*....................................... Senior Sec. Notes B2 B 7.63 11/01/2021 1,000,000
METALS & MINING -- 0.2%
Teck Resources, Ltd.*................................... Company Guar. Notes Ba3 BB 8 06/01/2021 420,000
OIL, GAS & CONSUMABLE FUELS -- 0.3%
Tullow Oil PLC*......................................... Company Guar. Notes Caa1 B- 6.00 11/01/2020 1,000,000
PHARMACEUTICALS -- 0.2%
Endo International PLC*................................. Company Guar. Notes B3 B 6.00 07/15/2023 560,000
TOTAL FOREIGN CORPORATE BONDS & NOTES (cost $7,415,635).
COMMON STOCKS -- 0.7%
ELECTRIC UTILITIES -- 0.4%
Vistra Energy Corp...................................... 69,610
Vistra Energy Corp., TRA Rights+........................ 69,610
MEDIA -- 0.0%
Vivial+(5)(6)(12)....................................... 1,136
OIL, GAS & CONSUMABLE FUELS -- 0.3%
Arch Coal, Inc., Class A+............................... 5,382
TE Holdcorp LLC, Class A+(5)(6)(12)..................... 44,278
TOTAL COMMON STOCKS (cost $6,739,972)...................
PREFERRED SECURITIES/CAPITAL SECURITIES -- 0.4%
BANKS -- 0.4%
Banco Bilbao Vizcaya Argentaria SA VRS(13).............. NR NR 9.00 05/09/2018 400,000
Royal Bank of Scotland Group PLC VRS(13)................ B1 B 8.63 08/15/2021 340,000
Societe Generale SA VRS(13)............................. Ba2 BB+ 8.25 11/29/2018 400,000
TOTAL PREFERRED SECURITIES/CAPITAL SECURITIES
(cost $1,196,225)......................................
TOTAL LONG-TERM INVESTMENT SECURITIES
(cost $288,797,782)....................................
VALUE
INDUSTRY DESCRIPTION (NOTE 2)
-----------------------------------------------------------------------
SPECIALTY RETAIL -- 0.2%
Party City Holdings, Inc.*.............................. $ 522,500
------------
TOTAL U.S. CORPORATE BONDS & NOTES (cost $13,879,409)... 14,270,335
------------
FOREIGN CORPORATE BONDS & NOTES -- 2.5%
CONTAINERS & PACKAGING -- 0.8%
ARD Finance SA*(11)..................................... 567,813
Ardagh Packaging Finance PLC FRS*....................... 1,030,000
Ardagh Packaging Finance PLC*........................... 721,819
------------
2,319,632
------------
DIVERSIFIED FINANCIAL SERVICES -- 0.1%
Tervita Escrow Corp.*................................... 311,100
------------
DIVERSIFIED TELECOMMUNICATION SERVICES -- 0.4%
Altice Financing SA*.................................... 521,250
Numericable SFR SA*..................................... 697,000
------------
1,218,250
------------
ENERGY EQUIPMENT & SERVICES -- 0.2%
Shelf Drilling Holdings, Ltd.*(5)....................... 583,800
------------
HOTELS, RESTAURANTS & LEISURE -- 0.3%
Codere Finance 2*....................................... 975,500
------------
METALS & MINING -- 0.2%
Teck Resources, Ltd.*................................... 462,000
------------
OIL, GAS & CONSUMABLE FUELS -- 0.3%
Tullow Oil PLC*......................................... 952,500
------------
PHARMACEUTICALS -- 0.2%
Endo International PLC*................................. 490,700
------------
TOTAL FOREIGN CORPORATE BONDS & NOTES (cost $7,415,635). 7,313,482
------------
COMMON STOCKS -- 0.7%
ELECTRIC UTILITIES -- 0.4%
Vistra Energy Corp...................................... 1,078,955
Vistra Energy Corp., TRA Rights+........................ 940
------------
1,079,895
------------
MEDIA -- 0.0%
Vivial+(5)(6)(12)....................................... 19,857
------------
OIL, GAS & CONSUMABLE FUELS -- 0.3%
Arch Coal, Inc., Class A+............................... 420,065
TE Holdcorp LLC, Class A+(5)(6)(12)..................... 442,783
------------
862,848
------------
TOTAL COMMON STOCKS (cost $6,739,972)................... 1,962,600
------------
PREFERRED SECURITIES/CAPITAL SECURITIES -- 0.4%
BANKS -- 0.4%
Banco Bilbao Vizcaya Argentaria SA VRS(13).............. 416,398
Royal Bank of Scotland Group PLC VRS(13)................ 346,800
Societe Generale SA VRS(13)............................. 416,024
------------
TOTAL PREFERRED SECURITIES/CAPITAL SECURITIES
(cost $1,196,225)...................................... 1,179,222
------------
TOTAL LONG-TERM INVESTMENT SECURITIES
(cost $288,797,782).................................... 279,859,270
------------
18
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
PORTFOLIO OF INVESTMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
RATINGS/(1)/ PRINCIPAL
(UNAUDITED) AMOUNT**/
----------- SHARES
INTEREST MATURITY
INDUSTRY DESCRIPTION TYPE MOODY'S S&P RATE DATE/(2)/
----------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENT SECURITIES -- 2.4%
REGISTERED INVESTMENT COMPANIES -- 2.4%
State Street Institutional Liquid Reserves Fund, Administration Class
0.46%(14)
(cost $6,768,008)...................................................... 6,767,768
REPURCHASE AGREEMENTS -- 3.5%
Bank of America Securities LLC Joint Repurchase Agreement(15).......... $2,295,000
Barclays Capital, Inc. Joint Repurchase Agreement(15).................. 2,505,000
BNP Paribas SA Joint Repurchase Agreement(15).......................... 1,460,000
Deutsche Bank AG Joint Repurchase Agreement(15)........................ 3,480,000
RBS Securities, Inc. Joint Repurchase Agreement(15).................... 415,000
TOTAL REPURCHASE AGREEMENTS (cost $10,155,000).........................
TOTAL INVESTMENTS-
(cost $305,720,790)(16)................................................ 103.3%
LIABILITIES IN EXCESS OF OTHER ASSETS.................................... (3.3)%
----------
NET ASSETS-.............................................................. 100.0%
==========
VALUE
INDUSTRY DESCRIPTION (NOTE 2)
---------------------------------------------------------------------------------------
SHORT-TERM INVESTMENT SECURITIES -- 2.4%
REGISTERED INVESTMENT COMPANIES -- 2.4%
State Street Institutional Liquid Reserves Fund, Administration Class
0.46%(14)
(cost $6,768,008)...................................................... $ 6,767,768
------------
REPURCHASE AGREEMENTS -- 3.5%
Bank of America Securities LLC Joint Repurchase Agreement(15).......... 2,295,000
Barclays Capital, Inc. Joint Repurchase Agreement(15).................. 2,505,000
BNP Paribas SA Joint Repurchase Agreement(15).......................... 1,460,000
Deutsche Bank AG Joint Repurchase Agreement(15)........................ 3,480,000
RBS Securities, Inc. Joint Repurchase Agreement(15).................... 415,000
------------
TOTAL REPURCHASE AGREEMENTS (cost $10,155,000)......................... 10,155,000
------------
TOTAL INVESTMENTS-
(cost $305,720,790)(16)................................................ 296,782,038
LIABILITIES IN EXCESS OF OTHER ASSETS.................................... (9,453,772)
------------
NET ASSETS-.............................................................. $287,328,266
============
--------
BTL Bank Term Loan
CTL Cayman Term Loan
DIP Debtor in Possession
EUR--EuroDollar
NR Security is not rated.
TRA--TaxReceivable Agreement Rights
FRS--FloatingRate Security
VRS--VariableRate Security
The rates shown on FRS and VRS are the current interest rates as of December
31, 2016 and unless noted otherwise, the dates shown are the original maturity
dates.
+ Non-income producing security
* Securities exempt from registration under Rule 144A of the Securities Act
of 1933. These securities may be sold in transactions exempt from
registration, normally to qualified institutional buyers. The Fund has no
rights to demand registration of these securities. At December 31, 2016,
the aggregate value of these securities was $18,341,519, representing 6.4%
of net assets. Unless otherwise indicated, these securities are not
considered to be illiquid.
** Denominated in United States Dollars unless otherwise noted.
(1) Bank loans rated below Baa by Moody's Investor Service, Inc. or BBB by
Standard & Poor's Group are considered below investment grade. Ratings
provided are as of December 31, 2016.
(2) Based on the stated maturity, the weighted average to maturity of the loans
held in the portfolio is approximately 66 months. Loans in the Fund's
portfolio are generally subject to mandatory and/or optional prepayment.
Because of these mandatory prepayment conditions and because there may be
significant economic incentives for a Borrower to prepay, prepayments may
occur. As a result, the actual remaining maturity may be substantially less
than the stated maturities shown.
(3) The Fund invests in senior loans which generally pay interest at rates
which are periodically re-determined by reference to a base lending rate
plus a premium. These base lending rates are generally either the lending
rate offered by one or more major European banks, such as the London
Inter-Bank Offer Rate ("LIBOR") or the prime rate offered by one or more
major United States banks, or the certificate of deposit rate. Senior loans
are generally considered to be restrictive in that the Fund is ordinarily
contractually obligated to receive approval from the Agent Bank and/or
borrower prior to the disposition of a senior loan.
(4) All loans in the portfolio were purchased through assignment agreements
unless otherwise indicated.
(5) Illiquid security. At December 31, 2016, the aggregate value of these
securities was $10,968,888, representing 3.8% of net assets.
(6) Fair valued security. Securities are classified as Level 3 based on the
securities valuation inputs (see Note 2).
(7) Company has filed for bankruptcy protection.
(8) All or a portion of this holding is subject to unfunded loan commitments
(see Note 10).
(9) Loan is in default of interest and did not pay principal at maturity.
(10)Loan is in default of interest.
(11)"Payment-in-Kind" (PIK) security -- Income may be paid in additional
securities or cash at the discretion of the issuer. The security is
currently paying interest in cash at the coupon rate listed.
(12)Denotes a restricted security that: (a) cannot be offered for public sale
without first being registered, or being able to take advantage of an
exemption from registration, under the Securities Act of 1933, as amended
(the "1933 Act"); (b) is subject to a contractual restriction on public
sales; or (c) is otherwise subject to a restriction on sales by operation
of applicable law. Restricted securities are valued pursuant to Note 1.
Certain restricted securities held by the Fund may not be sold except in
exempt transactions or in a public offering registered under the 1933 Act.
The Fund has no right to demand registration of these securities. The risk
of investing in certain restricted securities is greater than the risk of
investing in the securities of widely held, publicly traded companies. To
the extent applicable, lack of a secondary market and resale restrictions
may result in the inability of a Fund to sell a security at a fair price
and may substantially delay the sale of the security.
19
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
PORTFOLIO OF INVESTMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
In addition, certain restricted securities may exhibit greater price
volatility than securities for which secondary markets exist. As of
December 31, 2016, the Fund held the following restricted securities:
SHARES/
ACQUISITION PRINCIPAL ACQUISITION VALUE % OF NET
DESCRIPTION DATE AMOUNT COST VALUE PER SHARE ASSETS
----------- ----------- ---------- ----------- -------- --------- --------
U.S. CORPORATE BONDS & NOTES
Texas Competitive Electric Holdings Co. LLC
6.25% due 10/01/2020...................... 12/31/2016 $4,174,956 $ 0 $ 41,750 $ 1.00 0.00%
COMMON STOCKS
Vivial...................................... 04/24/2008 1,136 668,529 19,857 17.48 0.00
TE Holdcorp LLC, Class A.................... 12/31/2016 44,278 1,638,216 442,783 10.00 0.02
-------- ----
$504,390 0.02%
======== ====
(13)Perpetual maturity -- maturity date reflects the next call date.
(14)The rate shown is the 7-day yield as of December 31, 2016.
(15)See Note 2 for details of the Joint Repurchase Agreement.
(16)See Note 6 for cost of investments on a tax basis.
(17)"Payment-in-Kind" (PIK) security. Income may be paid in additional loans or
cash at the discretion of the issuer. The security is currently paying
interest in the form of additional loans at the coupon rate listed.
(18)As of December 31, 2016, the loan has not settled and as a result, the
interest rate is estimated based on information available.
(19)Subsequent to December 31, 2016, loan is in default of interest.
FORWARD FOREIGN CURRENCY CONTRACTS
--------------------------------------------------------------------------------
CONTRACT TO IN EXCHANGE DELIVERY UNREALIZED UNREALIZED
COUNTERPARTY DELIVER FOR DATE APPRECIATION DEPRECIATION
------------------ ------------- ------------- ---------- ------------ ------------
Barclays Bank PLC. EUR 1,130,000 USD 1,181,127 01/31/2017 $-- $(10,024)
=== ========
The following is a summary of the inputs used to value the Fund's net assets as
of December 31, 2016 (see Note 2):
LEVEL 1 -- UNADJUSTED LEVEL 2 -- OTHER LEVEL 3 -- SIGNIFICANT
QUOTED PRICES OBSERVABLE INPUTS UNOBSERVABLE INPUTS TOTAL
--------------------- ----------------- ---------------------- ------------
ASSETS:
Investments at Value:*
Loans:
Energy Equipment & Services........... $ -- $ 4,167,849 $352,209 $ 4,520,058
Media................................. -- 22,715,194 28,925 22,744,119
Other Industries...................... -- 227,869,454 -- 227,869,454
U.S. Corporate Bonds & Notes............ -- 14,270,335 -- 14,270,335
Foreign Corporate Bonds & Notes......... -- 7,313,482 -- 7,313,482
Common Stocks:
Electric Utilities.................... 1,078,955 940 -- 1,079,895
Media................................. -- -- 19,857 19,857
Oil, Gas & Consumable Fuels........... 420,065 -- 442,783 862,848
Preferred Securities/Capital Securities. -- 1,179,222 -- 1,179,222
Short-Term Investment Securities........ 6,767,768 -- -- 6,767,768
Repurchase Agreements................... -- 10,155,000 -- 10,155,000
---------- ------------ -------- ------------
TOTAL INVESTMENTS AT VALUE.............. $8,266,788 $287,671,476 $843,774 $296,782,038
========== ============ ======== ============
LIABILITIES:
Other Financial Instruments:@
Forward Foreign Currency Contracts...... $ -- $ 10,024 $ -- $ 10,024
========== ============ ======== ============
--------
* For a detailed presentation of investments, please refer to the Portfolio of
Investments.
@ Other financial instruments are derivative instruments not reflected in the
Portfolio of Investments, such as futures, forward, swap and written option
contracts, which are valued at the unrealized appreciation(depreciation) on
the instrument.
The Fund's policy is to recognize transfers between Levels as of the end of the
reporting period. There were no material transfers between Levels during the
reporting period.
At the beginning and end of the reporting period, Level 3 investments in
securities were not considered a material portion of the Fund.
See Notes to Financial Statements
20
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 2016
Note 1. Organization of the Fund
SunAmerica Senior Floating Rate Fund, Inc. (the "Fund") is an open-end,
diversified management investment company. The Fund was organized as a
Maryland corporation in 1998 and is registered under the Investment Company
Act of 1940, as amended (the "1940 Act"). The Fund is managed by SunAmerica
Asset Management, LLC (the "Adviser" or "SunAmerica"), an indirect
wholly-owned subsidiary of American International Group, Inc. ("AIG"). The
Fund's investment goal and principal investment techniques are to provide as
high a level of current income as is consistent with the preservation of
capital by investing, under normal market conditions, at least 80% of its
net assets, plus any borrowings for investment purposes, in senior secured
floating rate loans and other institutionally traded secured floating rate
debt obligations ("Loans"). The Fund may also purchase both investment grade
and high yield fixed income securities and money market instruments,
although the Fund may not invest more than 10% of its total assets in high
yield fixed income securities. The Fund may invest in foreign securities,
including up to 10% of its total assets in non-U.S. dollar denominated Loans
and high yield fixed income securities and up to 25% of its total assets in
U.S. dollar denominated Loans issued by non-U.S. companies.
The Fund offers two classes of shares. Class A shares are offered at net
asset value per share plus an initial sales charge. Additionally, purchases
of Class A shares in excess of $1,000,000 will be purchased at net asset
value but will be subject to a contingent deferred sales charge ("CDSC") on
redemptions made within two years of purchase. Class C shares are offered
for sale at net asset value without a front-end sales charge, although a
CDSC may be imposed on redemptions made within 12 months of purchase. The
share classes differ in their respective distribution and account
maintenance fees. All classes have equal rights to assets and voting
privileges except as may otherwise be provided in the Fund's registration
statement.
INDEMNIFICATIONS: The Fund's organizational documents provide current and
former officers and directors with a limited indemnification against
liabilities arising out of the performance of their duties to the Fund. In
addition, pursuant to Indemnification Agreements between the Fund and each
of the current directors who is not an "interested person," as defined in
Section 2(a)(19) of the 1940 Act, of the Fund (collectively, the
"Disinterested Directors"), the Fund provides the Disinterested Directors
with a limited indemnification against liabilities arising out of the
performance of their duties to the Fund, whether such liabilities are
asserted during or after their service as directors. In addition, in the
normal course of business, the Fund enters into contracts that contain the
obligation to indemnify others. The Fund's maximum exposure under these
arrangements is unknown. Currently, however, the Fund expects the risk of
loss to be remote.
Note 2. Significant Accounting Policies
The preparation of financial statements in accordance with U.S. generally
accepted accounting principles ("GAAP") requires management to make
estimates and assumptions that affect the reported amounts and disclosures
in the financial statements. Actual results could differ from these
estimates and those differences could be significant. The following is a
summary of significant accounting policies consistently followed by the Fund
in the preparation of its financial statements:
SECURITY VALUATION: In accordance with the authoritative guidance on fair
value measurements and disclosures under GAAP, the Fund discloses the fair
value of its investments in a hierarchy that prioritizes the inputs to
valuation techniques used to measure the fair value. In accordance with
GAAP, fair value is defined as the price that the Fund would receive upon
selling an asset or transferring a liability in a timely transaction to an
independent third party in the principal or most advantageous market. GAAP
establishes a three-tier hierarchy to provide more transparency around the
inputs used to measure fair value and to establish classification of fair
value measurements for disclosure purposes. Inputs refer broadly to the
assumptions that market participants would use in pricing the asset or
liability, including assumptions about risk. Inputs may be observable or
unobservable. Observable inputs are inputs that reflect the assumptions
market participants would use in pricing the asset or liability developed
based on market data obtained from sources independent of the reporting
entity. Unobservable inputs are inputs that reflect the reporting
21
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
entity's own assumptions about the assumptions market participants would use
in pricing the asset or liability developed based on the best information
available in the circumstances. The three-tiers are as follows:
Level 1 -- Unadjusted quoted prices in active markets for identical
securities
Level 2 -- Other significant observable inputs (including quoted prices for
similar securities, interest rates, prepayment speeds, credit risk,
referenced indices, quoted prices in inactive markets, adjusted quoted
prices in active markets, adjusted quoted prices on foreign equity
securities that were adjusted in accordance with pricing procedures approved
by the Board of Directors (the "Board"), etc.)
Level 3 -- Significant unobservable inputs (includes inputs that reflect the
Fund's own assumptions about the assumptions market participants would use
in pricing the security, developed based on the best information available
under the circumstances)
Changes in valuation techniques may result in transfers in or out of an
investment's assigned Level within the hierarchy. The methodology used for
valuing investments is not necessarily an indication of the risk associated
with investing in those investments and the determination of the
significance of a particular input to the fair value measurement in its
entirety requires judgment and consideration of factors specific to each
security.
The availability of observable inputs can vary from security to security and
is affected by a wide variety of factors, including, for example, the type
of security, whether the security is recently issued and not yet established
in the marketplace, the liquidity of markets, and other characteristics
particular to the security. To the extent that valuation is based on models
or inputs that are less observable or unobservable in the market, the
determination of fair value requires more judgment. Accordingly, the degree
of judgment exercised in determining fair value is greatest for instruments
categorized in Level 3.
The summary of the Fund's assets and liabilities classified in the fair
value hierarchy as of December 31, 2016, is reported on a schedule following
the Portfolio of Investments.
Stocks are generally valued based upon closing sales prices reported on
recognized securities exchanges on which the securities are principally
traded and are generally categorized as Level 1. Stocks listed on the NASDAQ
are valued using the NASDAQ Official Closing Price ("NOCP"). Generally, the
NOCP will be the last sale price unless the reported trade for the stock is
outside the range of the bid/ask price. In such cases, the NOCP will be
normalized to the nearer of the bid or ask price. For listed securities
having no sales reported and for unlisted securities, such securities will
be valued based upon the last reported bid price.
As of the close of regular trading on the New York Stock Exchange ("NYSE"),
securities traded primarily on security exchanges outside the United States
are valued at the last sale price on such exchanges on the day of valuation,
or if there is no sale on the day of valuation, at the last-reported bid
price. If a security's price is available from more than one exchange, the
Fund uses the exchange that is the primary market for the security. Such
securities are generally categorized as Level 1. However, depending on the
foreign market, closing prices may be up to 15 hours old when they are used
to price a Fund's shares, and the Fund may determine that certain closing
prices do not reflect the fair value of the security. This determination
will be based on the review of a number of factors, including developments
in foreign markets, the performance of U.S. securities markets, and the
performance of instruments trading in U.S. markets that represent foreign
securities and baskets of foreign securities. If the Fund determines that
closing prices do not reflect the fair value of the securities, the Fund
will adjust the previous closing prices in accordance with pricing
procedures approved by the Board to reflect what it believes to be the fair
value of the securities as of the close of regular trading on the NYSE. The
Fund may also fair value securities in other situations, for example, when a
particular foreign market is closed but the Fund is open. For foreign equity
securities and foreign equity futures contracts, the Fund uses an outside
pricing service to provide it with closing market prices and information
used for adjusting those prices, and when so adjusted, such securities and
futures are generally categorized as Level 2.
22
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
Bonds, debentures, and other debt securities are valued at evaluated bid
prices obtained for the day of valuation from a Board-approved pricing
service, and are generally categorized as Level 2. The pricing service may
use valuation models or matrix pricing which considers information with
respect to comparable bond and note transactions, quotations from bond
dealers, or by reference to other securities that are considered comparable
in such characteristics as rating, interest rate, and maturity date, option
adjusted spread models, prepayments projections, interest rate spreads, and
yield curves to determine current value. If a price is unavailable from a
Board-approved pricing service, the securities may be priced at the mean of
two independent quotes obtained from brokers.
Senior secured floating rate loans ("Loans") are valued at the average of
available bids in the market for such Loans, as provided by a Board-approved
loan pricing service, and are generally categorized as Level 2.
Investments in registered investment companies that do not trade on an
exchange are valued at the end of day net asset value per share. Investments
in registered investment companies that trade on an exchange are valued at
the last sales price or official closing price as of the close of the
customary trading session on the exchange where the security is principally
traded. Registered investment companies are generally categorized as Level 1.
Forward foreign currency contracts ("forward contracts") are valued at the
4:00 pm Eastern time forward rate and are generally categorized as Level 2.
The Board is responsible for the share valuation process and has adopted
policies and procedures (the "PRC Procedures") for valuing the securities
and other assets held by the Fund, including procedures for the fair
valuation of securities and other assets for which market quotations are not
readily available or are unreliable. The PRC Procedures provide for the
establishment of a pricing review committee, which is responsible for, among
other things, making certain determinations in connection with the Fund's
fair valuation procedures. Securities for which market quotations are not
readily available or the values of which may be significantly impacted by
the occurrence of developments or significant events are generally
categorized as Level 3. There is no single standard for making fair value
determinations, which may result in prices that vary from those of other
funds.
DERIVATIVE INSTRUMENTS:
FORWARD FOREIGN CURRENCY CONTRACTS: During the period, the Fund used forward
contracts to protect against uncertainty in the level of future exchange
rates.
A forward contract is an agreement between two parties to buy or sell
currency at a set price on a future date. The market value of the contract
will fluctuate with changes in currency exchange rates. The contract is
marked-to-market daily using the forward rate and the cumulative change in
market value is recorded by the Fund as unrealized appreciation or
depreciation. On the settlement date, the Fund records either realized gains
or losses equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed.
Risks to the Fund of entering into forward contracts include counterparty
risk, market risk and illiquidity risk. Counterparty risk arises upon
entering into these contracts from the potential inability of counterparties
to meet the terms of their contracts. If the counterparty defaults, the
Fund's loss will generally consist of the net amount of contractual payments
that the Fund has not yet received though the Fund's maximum exposure due to
counterparty risk could extend to the notional amount of the contract.
Market risk is the risk that the value of the forward contract will
depreciate due to unfavorable changes in the exchange rates. These contracts
may involve market risk in excess of the unrealized appreciation or
depreciation reported on the Statement of Assets and Liabilities.
Illiquidity risk arises because the secondary market for forwards may have
less liquidity relative to markets for other securities. Currency
transactions are also subject to risks different from those of other
portfolio transactions. Because currency control is of great importance to
the issuing governments and influences economic planning and policy,
purchases and sales of currency and related instruments can be adversely
affected by government exchange controls, limitations or restrictions on
repatriation of currency, and manipulations or exchange restrictions imposed
by governments.
23
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
Forward foreign currency contracts outstanding at the end of the period, if
any, are reported on a schedule following the Fund's Portfolio of
Investments.
MASTER AGREEMENTS: The Fund holds derivative instruments and other financial
instruments whereby the Fund may be a party to ISDA (International Swaps and
Derivatives Association, Inc.) Master Agreements or similar agreements
("Master Agreements") with certain counterparties that govern such
instruments. Master Agreements may contain provisions regarding, among other
things, the parties' general obligations, representations, agreements,
collateral requirements, events of default and early termination. Collateral
can be in the form of cash or securities as agreed to by the Fund and
applicable counterparty. Collateral requirements are generally determined
based on the Fund's net position with each counterparty. Master Agreements
may also include certain provisions that require the Fund to post additional
collateral upon the occurrence of certain events, such as when a Fund's net
assets fall below a specified level. In addition, Master Agreements
typically specify certain standard termination events, such as failure of a
party to pay or deliver, credit support defaults and other events of
default. Termination events applicable to the Fund may also occur upon a
decline in the Fund's net assets below a specified level over a certain
period of time. Additional termination events applicable to counterparties
may occur upon a decline in a counterparty's long-term and short-term credit
ratings below a specified level, or upon a decline in the ratings of a
counterparty's credit support provider. Upon the occurrence of a termination
event, the other party may elect to terminate early and cause settlement of
all instruments outstanding pursuant to a particular Master Agreement,
including the payment of any losses and costs resulting from such early
termination, as reasonably determined by the terminating party. Any decision
by one or more of the Fund's counterparties to elect early termination could
cause the Fund to accelerate the payment of liabilities, which settlement
amounts could be in excess of the amount of assets that are already posted
as collateral. Typically, the Master Agreement will permit a single net
payment in the event of default. Note, however, that bankruptcy or
insolvency laws of a particular jurisdiction may impose restrictions on or
prohibitions against the right of offset in bankruptcy, insolvency or other
events. As a result, the early termination with respect to derivative
instruments subject to Master Agreements that are in a net liability
position could be material to the Fund's financial statements. The Fund does
not offset derivative assets and derivative liabilities that are subject to
netting arrangements in the Statement of Assets and Liabilities.
The following tables represent the value of derivatives held as of
December 31, 2016, by their primary underlying risk exposure and respective
location on the Statement of Assets and Liabilities and the effect of
derivatives on the Statement of Operations for the year ended December 31,
2016. The Fund's derivative contracts held during the period are not
accounted for as hedging instruments under GAAP. For a detailed presentation
of derivatives held as of December 31, 2016, please refer to a schedule
following the Fund's Portfolio of Investments.
ASSET DERIVATIVES LIABILITY DERIVATIVES
----------------- --------------------
FOREIGN
FOREIGN EXCHANGE CONTRACTS EXCHANGE CONTRACTS
-------------------------- -----------------
FORWARD FOREIGN
FORWARD FOREIGN CURRENCY CONTRACTS(1) CURRENCY CONTRACTS(2)
------------------------------------- --------------------
$-- $10,024
=== =======
STATEMENT OF ASSETS AND LIABILITIES LOCATION:
(1) Unrealized appreciation on forward foreign currency contracts
(2) Unrealized depreciation on forward foreign currency contracts
24
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
CHANGE IN UNREALIZED
REALIZED GAIN (LOSS) APPRECIATION (DEPRECIATION)
ON DERIVATIVES RECOGNIZED ON DERIVATIVES RECOGNIZED
IN STATEMENT OF OPERATIONS IN STATEMENT OF OPERATIONS
-------------------------- -------------------------
FOREIGN
FOREIGN EXCHANGE CONTRACTS EXCHANGE CONTRACTS
-------------------------- ----------------
FORWARD FOREIGN
FORWARD FOREIGN CURRENCY CONTRACTS(1) CURRENCY CONTRACTS(2)
------------------------------------- -------------------
$(2,904) $(13,452)
======== ========
STATEMENT OF OPERATIONS LOCATION:
(1) Net realized foreign exchange gain (loss) on other assets and
liabilities
(2) Change in unrealized foreign exchange gain (loss) on other
assets and liabilities
The following table represents the average monthly balance of derivatives
held during the year ended December 31, 2016:
AVERAGE AMOUNT
OUTSTANDING
DURING THE PERIOD
---------------------
FOREIGN
FUND EXCHANGE CONTRACTS(1)
---- ---------------------
Senior Floating Rate............... $315,123
========
-
(1) Amounts represent notional amounts in US dollars.
The following table sets forth the Fund's derivative assets and liabilities
by counterparty, net of amounts available for offset under Master Agreements
and net of the related collateral pledged/(received) as of December 31,
2016. The repurchase agreements held by the Fund as of December 31, 2016,
are also subject to Master Agreements but are not included in the following
tables. See the Portfolio of Investments and the Notes to the Financial
Statements for more information about the Fund's holdings in repurchase
agreements.
SENIOR FLOATING RATE FUND
-----------------------------------------------------------------
DERIVATIVE ASSETS(1) DERIVATIVE LIABILITIES(1)
------------------------------- ---------------------------------
FORWARD FORWARD NET
FOREIGN FOREIGN DERIVATIVE COLLATERAL
CURRENCY OTC OPTIONS CURRENCY OTC OPTIONS ASSETS PLEDGED/
COUNTERPARTY CONTRACTS SWAPS PURCHASED TOTAL CONTRACTS SWAPS PURCHASED TOTAL (LIABILITIES) (RECEIVED)(2)
------------ --------- ----- --------- ----- --------- ----- --------- ------- ------------- -------------
Barclays Bank PLC............. $-- $-- $-- $-- $10,024 $-- $-- $10,024 $(10,024) $--
=== === === === ======= === === ======= ======== ===
NET
COUNTERPARTY AMOUNT(3)
------------ ---------
Barclays Bank PLC............. $(10,024)
========
-
(1)Gross amounts of recognized assets and liabilities not offset in the
Statement of Assets and Liabilities.
(2)For each respective counterparty, collateral pledged or (received) is
limited to an amount not to exceed 100% of the net amount of the
derivative asset/liability in the above table.
(3)Net amount represents the net amount due (to)/from counterparty in
the event of a default based on the contractual set-off rights under
the agreement.
REPURCHASE AGREEMENTS: The Fund, along with other affiliated registered
investment companies, pursuant to procedures adopted by the Board and
applicable guidance from the Securities and Exchange Commission ("SEC"), may
transfer uninvested cash balances into a single joint account, the daily
aggregate balance of which is invested in one or more repurchase agreements
collateralized by U.S. Treasury or federal agency obligations. In a
repurchase agreement, the seller of a security agrees to repurchase the
security at a mutually agreed-upon time and price, which reflects the
effective rate of return for the term of the agreement. For repurchase
agreements and joint repurchase agreements, the Fund's custodian takes
possession of the collateral pledged for investments in such repurchase
agreements ("repo" or collectively "repos"). The underlying collateral is
valued daily on a mark to market basis, plus accrued interest, to ensure
that the value, at the time the agreement is entered into, is equal to at
least 102% of the repurchase price, including accrued interest. In the event
of default of the obligation to repurchase, the Fund has the right to
liquidate the collateral and apply the proceeds in satisfaction of the
obligation. If the seller defaults and the
25
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
value of the collateral declines or if bankruptcy proceedings are commenced
with respect to the seller of the security, realization of the collateral by
the Fund may be delayed or limited.
As of December 31, 2016, the Fund held an undivided interest in a joint
repurchase agreement with Bank of America Securities LLC:
PERCENTAGE PRINCIPAL
OWNERSHIP AMOUNT
---------- ----------
Senior Floating Rate Fund.......... 4.17% $2,295,000
As of such date, the repurchase agreement in that joint account and the
collateral thereof were as follows:
Bank of America Securities LLC, dated December 30, 2016, bearing interest at
a rate of 0.46% per annum, with a principal amount of $55,000,000, a
repurchase price of $55,002,811, and a maturity date of January 3, 2017. The
repurchase agreement is collateralized by the following:
INTEREST MATURITY
TYPE OF COLLATERAL RATE DATE PRINCIPAL AMOUNT VALUE
------------------ -------- ---------- ---------------- -----------
U.S. Treasury Notes................ 2.13% 05/15/2025 $15,618,500 $15,300,106
U.S. Treasury Notes................ 2.25 11/15/2025 41,385,400 40,816,645
As of December 31, 2016, the Fund held an undivided interest in a joint
repurchase agreement with Barclays Capital, Inc.:
PERCENTAGE PRINCIPAL
OWNERSHIP AMOUNT
---------- ----------
Senior Floating Rate Fund.......... 4.18% $2,505,000
As of such date, the repurchase agreement in that joint account and the
collateral thereof were as follows:
Barclays Capital, Inc., dated December 30, 2016, bearing interest at a rate
of 0.40% per annum, with a principal amount of $60,000,000, a repurchase
price of $60,002,667, and a maturity date of January 3, 2017. The repurchase
agreement is collateralized by the following:
INTEREST MATURITY
TYPE OF COLLATERAL RATE DATE PRINCIPAL AMOUNT VALUE
------------------ -------- ---------- ---------------- -----------
U.S. Treasury Bonds................ 5.50% 08/15/2028 $46,718,000 $61,200,580
As of December 31, 2016, the Fund held an undivided interest in a joint
repurchase agreement with BNP Paribas SA:
PERCENTAGE PRINCIPAL
OWNERSHIP AMOUNT
---------- ----------
Senior Floating Rate Fund.......... 4.17% $1,460,000
As of such date, the repurchase agreement in that joint account and the
collateral thereof were as follows:
BNP Paribas SA, dated December 30, 2016, bearing interest at a rate of
0.50% per annum, with a principal amount of $35,000,000, a repurchase price
of $35,001,944, and a maturity date of January 3, 2017. The repurchase
agreement is collateralized by the following:
INTEREST MATURITY
TYPE OF COLLATERAL RATE DATE PRINCIPAL AMOUNT VALUE
------------------ -------- ---------- ---------------- -----------
U.S. Treasury Notes................ 1.13% 02/28/2021 $36,615,400 $35,717,277
26
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
As of December 31, 2016, the Fund held an undivided interest in a joint
repurchase agreement with Deutsche Bank AG:
PERCENTAGE PRINCIPAL
OWNERSHIP AMOUNT
---------- ----------
Senior Floating Rate Fund.......... 4.20% $3,480,000
As of such date, the repurchase agreement in that joint account and the
collateral thereof were as follows:
Deutsche Bank AG, dated December 30, 2016, bearing interest at a rate of
0.49% per annum, with a principal amount of $82,870,000, a repurchase price
of $82,874,512, and a maturity date of January 3, 2017. The repurchase
agreement is collateralized by the following:
INTEREST MATURITY
TYPE OF COLLATERAL RATE DATE PRINCIPAL AMOUNT VALUE
------------------ -------- ---------- ---------------- -----------
U.S. Treasury Notes................ 2.00% 08/15/2025 $87,153,000 $84,759,691
As of December 31, 2016, the Fund held an undivided interest in a joint
repurchase agreement with RBS Securities, Inc.:
PERCENTAGE PRINCIPAL
OWNERSHIP AMOUNT
---------- ---------
Senior Floating Rate Fund.......... 4.15% $415,000
As of such date, the repurchase agreement in that joint account and the
collateral thereof were as follows:
RBS Securities, Inc., dated December 30, 2016, bearing interest at a rate of
0.46% per annum, with a principal amount of $10,000,000, a repurchase price
of $10,000,511, and a maturity date of January 3, 2017. The repurchase
agreement is collateralized by the following:
INTEREST MATURITY
TYPE OF COLLATERAL RATE DATE PRINCIPAL AMOUNT VALUE
------------------ -------- ---------- ---------------- -----------
U.S. Treasury Notes................ 2.13% 05/15/2025 $10,413,000 $10,200,724
WHEN-ISSUED SECURITIES AND FORWARD COMMITMENTS: The Fund may purchase or
sell when-issued securities that have been authorized, but not yet issued in
the market. In addition, the Fund may purchase or sell securities on a
forward commitment basis. A forward commitment involves entering into a
contract to purchase or sell securities, typically on an extended settlement
basis, for a fixed price at a future date. The Fund may engage in
when-issued or forward commitment transactions in order to secure what is
considered to be an advantageous price and yield at the time of entering
into the obligation. The purchase of securities on a when-issued or forward
commitment basis involves a risk of loss if the value of the security to be
purchased declines before the settlement date. Conversely, the sale of
securities on a when-issued or forward commitment basis involves the risk
that the value of the securities sold may increase before the settlement
date.
SECURITIES TRANSACTIONS, INVESTMENT INCOME, EXPENSES, DIVIDENDS AND
DISTRIBUTIONS TO SHAREHOLDERS: Security transactions are recorded on a trade
date basis. Realized gains and losses on sales of investments are calculated
on the identified cost basis. Interest income is accrued daily from
settlement date except when collection is not expected. Dividend income is
recorded on the ex-dividend date. For financial statement purposes, the Fund
amortizes all premiums and accretes all discounts. Facility fees received,
which were $510,308 for the year ended December 31, 2016, are accreted to
income over the life of the Loans. Other income, including amendment fees,
commitment fees, letter of credit fees, etc., which were $286,180 for the
year ended December 31, 2016, are recorded as income when received or
contractually due to the Fund.
27
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
Securities purchased or sold on a when-issued or forward commitment basis
are included in receivable for/payable for investments sold/purchased on an
extended settlement basis in the Statement of Assets and Liabilities.
Net investment income, other than class specific expenses, and realized and
unrealized gains and losses are allocated daily to each class of shares
based upon the relative net asset value of outstanding shares (or the value
of dividend-eligible shares, as appropriate) of each class of shares at the
beginning of the day (after adjusting for the current capital share activity
of the respective class).
Dividends from net investment income are normally declared daily and paid
monthly. Capital gain distributions, if any, are paid annually. The Fund
records dividends and distributions to the shareholders on the ex-dividend
date. The amount of dividends and distributions from net investment income
and net realized capital gains are determined in accordance with federal
income tax regulations, which may differ from GAAP. These "book/tax"
differences are either considered temporary or permanent in nature. To the
extent these differences are permanent in nature, such amounts are
reclassified within the capital accounts at fiscal year end based on their
federal tax-basis treatment; temporary differences do not require
reclassification. Net assets are not affected by the reclassifications.
The Fund is considered a separate entity for tax purposes and intends to
comply with the requirements of the Internal Revenue Code, as amended,
applicable to regulated investment companies and distribute all of its
taxable income, including any net capital gains on investments, to its
shareholders. The Fund also intends to distribute sufficient net investment
income and net capital gains, if any, so that the Fund will not be subject
to excise tax on undistributed income and gains. Therefore, no federal
income tax or excise tax provision is required.
The Fund recognizes the tax benefits of uncertain tax positions only when
the position is more likely than not to be sustained, assuming examination
by tax authorities. Management has analyzed the Fund's tax positions and
concluded that no liability for unrecognized tax benefits should be recorded
related to uncertain tax positions taken on returns filed for open tax years
2013-2015 or expected to be taken in the Fund's 2016 tax return. The Fund is
not aware of any tax provisions for which it is reasonably possible that the
total amounts of unrecognized tax benefits will change materially in the
next twelve months. The Fund files U.S. federal and certain state income tax
returns. With few exceptions, the Fund is no longer subject to U.S. federal
and state tax examinations by tax authorities for tax returns ending before
2013.
Note 3. Capital Share Transactions
Transactions in capital shares of each class of the Fund were as follows:
FOR THE FOR THE
YEAR ENDED YEAR ENDED
DECEMBER 31, 2016 DECEMBER 31, 2015
------------------------ ------------------------
SHARES AMOUNT SHARES AMOUNT
CLASS A ---------- ------------ ---------- ------------
Shares sold................. 4,951,013 $ 39,136,197 3,655,429 $ 29,357,944
Reinvested distributions.... 440,371 3,436,435 543,438 4,341,805
Shares redeemed............. (4,091,329) (31,742,954) (7,912,117) (62,830,193)
---------- ------------ ---------- ------------
Net increase (decrease).. 1,300,055 $ 10,829,678 (3,713,250) $(29,130,444)
========== ============ ========== ============
FOR THE FOR THE
YEAR ENDED YEAR ENDED
DECEMBER 31, 2016 DECEMBER 31, 2015
------------------------ ------------------------
SHARES AMOUNT SHARES AMOUNT
CLASS C ---------- ------------ ---------- ------------
Shares sold................. 1,250,845 $ 9,840,545 2,445,047 $ 19,547,765
Reinvested distributions.... 545,310 4,246,724 702,479 5,608,496
Shares redeemed............. (5,119,483) (39,717,705) (7,480,670) (59,685,098)
---------- ------------ ---------- ------------
Net increase (decrease).. (3,323,328) $(25,630,436) (4,333,144) $(34,528,837)
========== ============ ========== ============
28
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
Note 4. Purchases and Sales of Securities
During the year ended December 31, 2016, the Fund's cost of purchases and
proceeds from sale of long-term investments, including loan principal
paydowns, were $162,671,409 and $167,649,220, respectively.
Note 5. Investment Advisory Agreement and Other Transactions with Affiliates
The Fund has entered into an Investment Advisory and Management Agreement
(the "Advisory Agreement") with SunAmerica. Pursuant to the Advisory
Agreement, SunAmerica provides continuous supervision of the Fund and
administers its corporate affairs, subject to the general review and
oversight of the Board. In connection therewith, SunAmerica furnishes the
Fund with office facilities, maintains certain of the Fund's books and
records and pays the salaries and expenses of all personnel, including
officers of the Fund who are employees of SunAmerica and its affiliates.
SunAmerica also selects, contracts with and compensates the subadviser to
manage the Fund's assets. The Fund will pay SunAmerica a monthly management
fee at the following annual rates, based on the average daily net assets of
the Fund: 0.85% on the first $1 billion; 0.80% on the next $1 billion; and
0.75% in excess of $2 billion.
Wellington Management Company LLP ("Wellington") acts as subadviser to the
Fund pursuant to a Subadvisory Agreement with SunAmerica. Under the
Subadvisory Agreement, Wellington manages the investment and reinvestment of
the Fund's assets. For compensation for its services as subadviser,
Wellington is entitled to receive from SunAmerica a monthly fee payable at
the following annual rates: 0.30% of average daily net assets on the first
$500 million and 0.25% thereafter. The fee paid to the subadviser is paid by
SunAmerica and not the Fund.
Pursuant to the Administrative Services Agreement (the "Administrative
Agreement"), SunAmerica acts as the Fund's administrator and is responsible
for providing and supervising the performance by others, of administrative
services in connection with the operations of the Fund, subject to
supervision by the Fund's Board. For its services, SunAmerica receives an
annual fee equal to 0.20% of average daily net assets of the Fund. For the
year ended December 31, 2016, SunAmerica earned fees as reflected in the
Statement of Operations based upon the aforementioned rate.
The Fund has entered into a Distribution Agreement with AIG Capital
Services, Inc. ("ACS" or the "Distributor"), an affiliate of the Adviser.
The Fund has adopted a Distribution Plan on behalf of each class of shares
(each a "Plan" and collectively, the "Plans") in accordance with the
provisions of Rule 12b-1 under the 1940 Act, hereinafter referred to as the
"Class A Plan" and "Class C Plan". In adopting the Plans, the Board
determined that there was a reasonable likelihood that each such Plan would
benefit the Fund and the shareholders of the respective class. The sales
charge and distribution fees of a particular class will not be used to
subsidize the sale of shares of any other class.
Under the Class A Plan and Class C Plan, the Distributor receives payments
from the Fund at an annual rate of 0.10% and 0.50%, respectively, of the
average daily net assets of the Fund's Class A and Class C shares to
compensate the Distributor and certain securities firms for providing sales
and promotional activities for distributing that class of shares. The
distribution costs for which the Distributor may be compensated include fees
paid to broker-dealers that have sold Fund shares, commissions and other
expenses such as those incurred for sales literature, prospectus printing
and distribution and compensation to wholesalers. It is possible that in any
given year, the amount paid to the Distributor under each Class' Plan may
exceed the Distributor's distribution costs as described above. The Plans
provide that the Class A and Class C shares of the Fund will pay the
Distributor an account maintenance fee up to an annual rate of 0.25% of the
aggregate average daily net assets of such class of shares for payments to
compensate the Distributor and certain securities firms for account
maintenance activities. For the year ended December 31, 2016, ACS received
fees (see Statement of Operations) based upon the aforementioned rates. For
the year ended December 31, 2016, ACS received sales charges on Class A
shares of $106,874, of which $37,881 was reallowed to affiliated
broker-dealers and $47,707 to non-affiliated broker-dealers. In addition,
ACS receives the proceeds of contingent deferred sales charges paid by
investors in connection with certain redemptions of Class A and Class C
shares. For the year ended December 31, 2016, ACS received contingent
deferred sales charges of $2,987.
29
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
The Fund has entered into a Service Agreement with SunAmerica Fund Services,
Inc. ("SAFS") an affiliate of the Adviser. Under the Service Agreement, SAFS
performs certain shareholder account functions by assisting the Fund's
transfer agent in connection with the services that it offers to the
shareholders of the Fund. The Service Agreement, which permits the Fund to
compensate SAFS for services rendered based upon an annual rate of 0.22% of
average daily net assets, is approved annually by the Board. For the year
ended December 31, 2016, the Fund incurred the following expenses, which are
included in the transfer agent fees and expenses payable in the Statement of
Assets and Liabilities and in transfer agent fees and expenses in the
Statement of Operations to compensate SAFS pursuant to the terms of the
Service Agreement.
PAYABLE AT
EXPENSE DECEMBER 31, 2016
-------- -----------------
Class A............................ $249,094 $24,095
Class C............................ 352,102 29,024
SunAmerica has contractually agreed to waive fees and/or reimburse expenses
to the extent necessary to cap the Fund's annual operating expenses at 1.45%
for Class A and 1.75% for Class C, of average daily net assets. For purposes
of waived fees and/or reimbursed expense calculations, annual Fund operating
expenses shall not include extraordinary expenses, (i.e., expenses that are
unusual in nature and/or infrequent in occurrence, such as litigation), or
acquired fund fees and expenses, brokerage commissions and other
transactional expenses relating to the purchase and sale of portfolio
securities, interest, taxes and governmental fees and other expenses not
incurred in the ordinary course of the Fund's business. The expense
reimbursements and fee waivers will continue indefinitely, unless terminated
by the Board, including a majority of the Disinterested Directors. For the
year ended December 31, 2016, SunAmerica waived fees and/or reimbursed
expenses as follows: Class A $379,271 and Class C $677,022.
Note 6. Federal Income Taxes
The following details the tax basis distributions as well as the components
of distributable earnings. The tax basis components of distributable
earnings differ from the amounts reflected in the Statement of Assets and
Liabilities by temporary book/tax differences primarily arising from
dividends payable and wash sales.
DISTRIBUTABLE EARNINGS TAX DISTRIBUTIONS TAX DISTRIBUTIONS
---------------------------------------- ------------------------------------- -------------------------------------
FOR THE YEAR ENDED DECEMBER 31, 2016 FOR THE YEAR ENDED DECEMBER 31, 2016 FOR THE YEAR ENDED DECEMBER 31, 2015
---------------------------------------- ------------------------------------- -------------------------------------
LONG-TERM GAINS/ UNREALIZED LONG-TERM LONG-TERM
ORDINARY CAPITAL AND APPRECIATION/ ORDINARY CAPITAL ORDINARY CAPITAL
INCOME OTHER LOSSES (DEPRECIATION) INCOME GAINS INCOME GAINS
-------- ---------------- -------------- ------------ --------- ------------ ---------
$-- $(47,861,156) $(8,953,986) $10,100,667 $-- $13,518,809 $--
CAPITAL LOSS CARRYFORWARDS: At December 31, 2016 for Federal income tax
purposes, the Fund has capital loss carryforwards available to offset future
capital gains of $27,303,177 expiring in 2017. Additionally, the Fund has
$307,778 and $20,250,201 of unlimited short-term and long-term capital
losses respectively. For the year ended December 31, 2016, the fund utilized
short-term capital losses of $145,785 and expired capital loss carryforwards
of $16,003,027.+
-----
+ On December 22, 2010, the Regulated Investment Company Modernization Act of
2010 (the "Act") was enacted which changed various technical rules
governing the tax treatment of regulated investment companies. The changes
are generally effective for taxable years beginning after the date of
enactment. Under the Act, the fund will be permitted to carry forward
capital losses incurred in taxable years beginning after the date of
enactment for an unlimited period. However, any losses incurred during
those future taxable years will be required to be utilized prior to the
losses incurred in pre-enactment taxable years, which carry an expiration
date. As a result of this ordering rule, pre-enactment capital loss
carryforwards may be more likely to expire unused. Additionally,
post-enactment capital losses that are carried forward will retain their
character as either short-term or long-term losses rather than being
considered all short-term as under previous law.
Under the current law, capital losses realized after October 31 and
specified ordinary losses may be deferred and treated as occurring on the
first day of the following year. For the year ended December 31, 2016, the
fund did not defer any Post-October capital losses.
30
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
For the year ended December 31, 2016, reclassifications were made to
decrease accumulated net realized gain (loss) by $15,991,846 with an
offsetting adjustment to undistributed net investment income of $11,181 and
a reduction to paid in capital of $16,003,027. The reclassifications arising
from book/tax differences were due primarily to the reclassification of
foreign currency gains and losses and expiration of capital loss
carryforwards.
Unrealized appreciation and depreciation in the value of investments at
December 31, 2016 for federal income tax purposes were as follows:
Cost (tax basis)................... $305,723,481
============
Gross unrealized appreciation...... 3,342,080
Gross unrealized depreciation...... (12,283,523)
------------
Net unrealized depreciation........ $ (8,941,443)
============
Note 7. Line of Credit
The Fund, along with certain other funds managed by the Adviser has access
to a $75 million committed unsecured line of credit and a $50 million
uncommitted unsecured line of credit. The committed and uncommitted lines of
credit are renewable on an annual basis with State Street Bank and Trust
Company ("State Street"), the Fund's custodian. Interest is currently
payable on the committed line of credit at the higher of the Federal Funds
Rate (but not less than zero) plus 125 basis points or the One-Month London
Interbank Offered Rate (but not less than zero) plus 125 basis points and
State Street's discretionary bid rate on the uncommitted line of credit. The
Fund has paid State Street for its own account, such Fund's ratable portion
of an upfront fee in an amount equal to $100,000 in the aggregate for the
committed and uncommitted lines of credit and the committed line of credit
made available by State Street to certain other funds managed by the
Adviser, which are also party to the uncommitted line of credit. The
$100,000 upfront fee is inclusive of a closing fee of 5 basis points on the
uncommitted line of credit. There is also a commitment fee of 25 basis
points per annum on the daily unused portion of the committed line of
credit. Borrowings under the line of credit will commence when the
respective Fund's cash shortfall exceeds $100,000.
For the year ended December 31, 2016, the Fund did not utilize the line of
credit.
Note 8. Interfund Lending
Pursuant to the exemptive relief granted by the SEC, the Fund is permitted
to participate in an interfund lending program among investment companies
advised by SunAmerica or an affiliate. The interfund lending program allows
the participating funds to borrow money from and lend money to each other
for temporary or emergency purposes. An interfund loan will be made under
this facility only if the participating funds receive a more favorable
interest rate than would otherwise be available from a typical bank for a
comparable transaction. For the year ended December 31, 2016, the Fund did
not participate in this program.
Note 9. Investment Concentration
The Fund invests primarily in participations and assignments, or acts as a
party to the primary lending syndicate of a variable rate senior loan
interest to United States corporations, partnerships, and other entities. If
the lead lender in a typical lending syndicate becomes insolvent, enters
receivership or, if not FDIC insured, enters into bankruptcy, the Fund may
incur certain costs and delays in receiving payment, or may suffer a loss of
principal and/or interest. When the Fund purchases a participation of a
senior loan interest, the Fund typically enters into a contractual agreement
with the lender or other third party selling the participation but not with
the borrower directly. As such, the Fund is subject to the credit risk of
the borrower, selling participant, lender or other persons positioned
between the Fund and the borrower.
31
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
NOTES TO FINANCIAL STATEMENTS -- DECEMBER 31, 2016 -- (CONTINUED)
Note 10. Unfunded Loan Commitments
At December 31, 2016, the Fund had the following unfunded loan commitments
which could be extended at the option of the Borrower:
BORROWER TYPE MATURITY DATE PRINCIPAL AMOUNT VALUE
-------- ------------ ------------- ---------------- -------
Kenan Advantage Group, Inc......... Delayed Draw 01/23/2017 $47,178 $47,134
Note 11. Subsequent Event
On November 18, 2016, the Board authorized the Fund's single series to be
named the "AIG Senior Floating Rate Fund," effective February 28, 2017.
32
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders of SunAmerica Senior Floating Rate
Fund, Inc.
In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of SunAmerica Senior Floating Rate
Fund, Inc. (the "Fund") as of December 31, 2016, the results of its operations
for the year then ended, the changes in its net assets for each of the two
years in the period then ended and the financial highlights for each of the
five years in the period then ended, in conformity with accounting principles
generally accepted in the United States of America. These financial statements
and financial highlights (hereafter referred to as "financial statements") are
the responsibility of the Fund's management. Our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, and evaluating the overall
financial statement presentation. We believe that our audits, which included
confirmation of securities as of December 31, 2016 by correspondence with the
custodian, brokers and selling or agent banks, and the application of
alternative auditing procedures where securities purchased had not been
received, provide a reasonable basis for our opinion expressed above.
PricewaterhouseCoopers LLP
Houston, Texas
February 27, 2017
33
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
DIRECTORS AND OFFICERS INFORMATION -- DECEMBER 31, 2016 -- (UNAUDITED)
The following table contains basic information regarding the Trustees and
Officers that oversee operations of the Funds and other investment companies
within the Fund complex.
NUMBER OF
POSITION TERM OF PORTFOLIOS IN
NAME, HELD WITH OFFICE AND FUND COMPLEX
ADDRESS AND SUNAMERICA LENGTH OF PRINCIPAL OCCUPATIONS OVERSEEN BY
AGE* COMPLEX TIME SERVED(4) DURING PAST 5 YEARS TRUSTEE(1)
----------------------- ------------ -------------- --------------------------------- -------------
DISINTERESTED TRUSTEES
Dr. Judith L. Craven Trustee 2000- Retired. 78
Age: 71 present
William F. Devin Trustee 1998- Retired. 78
Age: 78 present
Richard W. Grant Trustee 2011- Retired. Prior to that, attorney 29
Age: 71 Chairman present and partner at Morgan Lewis
of the & Bockius LLP (1989 to
Board 2011).
Stephen J. Gutman Trustee 2001- Senior Vice President and 29
Age: 73 present Associate Broker, Corcoran
Group (real estate) (2002 to
present); President, SJG
Marketing, Inc. (2009 to
present).
INTERESTED TRUSTEE
Peter A. Harbeck(3) Trustee 2001- President, CEO and Director, 141
Age: 63 present SunAmerica. (1995 to
present); Director, AIG
Capital Services, Inc. ("ACS")
(1993 to present).
OFFICERS
John T. Genoy President 2007- Chief Financial Officer, N/A
Age: 48 present SunAmerica (2002 to
present); Senior Vice
President, SunAmerica (2003
to present); Chief Operating
Officer, SunAmerica (2006
to present).
Gregory N. Bressler Secretary 2005- Senior Vice President and N/A
Age: 50 present General Counsel,
SunAmerica (2005 to
present).
Kathleen D. Fuentes Chief Legal 2013- Vice President and Deputy N/A
Age: 47 Officer and present General Counsel,
Assistant SunAmerica (2006 to
Secretary present).
James Nichols Vice 2006- Director, President and CEO, N/A
Age: 50 President present ACS (2006 to present);
Senior Vice President,
SunAmerica (2002 to
present).
Kara Murphy Vice 2014- Chief Investment Officer, N/A
Age: 44 President present SunAmerica (2013 to
present).
NAME,
ADDRESS AND OTHER DIRECTORSHIPS
AGE* HELD BY TRUSTEE(2)
----------------------- -------------------------------
DISINTERESTED TRUSTEES
Dr. Judith L. Craven Director, Sysco Corp. (1996
Age: 71 to present); Director, Luby's,
Inc. (1998 to present).
William F. Devin None
Age: 78
Richard W. Grant None
Age: 71
Stephen J. Gutman None
Age: 73
INTERESTED TRUSTEE
Peter A. Harbeck(3) None
Age: 63
OFFICERS
John T. Genoy N/A
Age: 48
Gregory N. Bressler N/A
Age: 50
Kathleen D. Fuentes N/A
Age: 47
James Nichols N/A
Age: 50
Kara Murphy N/A
Age: 44
34
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
DIRECTORS AND OFFICERS INFORMATION -- DECEMBER 31, 2016 -- (UNAUDITED)
(CONTINUED)
NUMBER OF
POSITION TERM OF PORTFOLIOS IN
NAME, HELD WITH OFFICE AND FUND COMPLEX
ADDRESS AND SUNAMERICA LENGTH OF PRINCIPAL OCCUPATIONS OVERSEEN BY OTHER DIRECTORSHIPS
AGE* COMPLEX TIME SERVED(4) DURING PAST 5 YEARS TRUSTEE(1) HELD BY TRUSTEE(2)
--------------------- ----------- -------------- ---------------------------- ------------- -------------------
OFFICERS
Gregory R. Kingston Treasurer 2014- Vice President, SunAmerica N/A N/A
Age: 51 present (2001 to present); Head of
Mutual Fund Administration,
SunAmerica (2014 to
present).
Shawn Parry Vice 2014- Vice President (2014 to N/A N/A
Age: 44 President present present) and Assistant Vice
and President, SunAmerica
Assistant (2005 to 2014).
Treasurer
Donna McManus Vice 2014- Vice President, SunAmerica, N/A N/A
Age: 56 President present (2014 to present); Managing
and Director, BNY Mellon (2009-
Assistant 2014).
Treasurer
Matthew J. Hackethal Acting 2006- Acting Chief Compliance N/A N/A
Age: 45 Chief present Officer (2016 to present);
Compliance Chief Compliance Officer
Officer; (2006 to present) and Vice
Anti-Money President, SunAmerica (2011
Laundering to present).
Compliance
Officer
--------
* The business address for each Trustee is the Harborside 5, 185 Hudson
Street, Suite 3300, Jersey City, NJ 07311.
(1) The "Fund Complex" means two or more registered investment companies that
hold themselves out to investors as related companies for purposes of
investment services or have a common investment adviser or an investment
adviser that is an affiliated person of the Adviser. The "Fund Complex"
includes the Fund (1 fund), SunAmerica Money Market Funds Inc. (1 fund),
SunAmerica Equity Funds (2 funds), SunAmerica Income Funds (3 funds),
SunAmerica Series, Inc. (6 portfolios), Anchor Series Trust (8 portfolios),
SunAmerica Specialty Series (8 funds), SunAmerica Series Trust
(43 portfolios), VALIC Company I (34 portfolios), VALIC Company II (15
funds), Seasons Series Trust (20 portfolios).
(2) Directorships of companies required to report to the SEC under the
Securities Exchange Act of 1934 (i.e., "public companies") or other
investment companies registered under the 1940 Act.
(3) Interested Trustee, as defined within the 1940 Act, because he is an
officer and a director of the Adviser and a director of the principal
underwriter of the Fund.
(4) Trustees serve until their successors are duly elected and qualified. Each
officer will hold office for an indefinite term, until the date he or she
resigns or retires or until his/her successor is duly elected and qualifies.
Additional information concerning the Trustees is contained in the Statement of
Additional Information which is available, without charge, by calling (800)
858-8850.
35
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
SHAREHOLDER TAX INFORMATION -- (UNAUDITED)
Certain tax information regarding the Fund is required to be provided to
shareholders based upon the Fund's income and distributions for the taxable
year ended December 31, 2016. The information necessary to complete your income
tax returns is included with your Form 1099-DIV, which will be mailed to
shareholders in early 2017.
During the year ended December 31, 2016, the Fund paid the following dividends
along with the percentage of ordinary income dividends that qualified for the
70% dividends received deductions for corporations:
NET QUALIFYING % FOR
LONG-TERM THE 70% DIVIDENDS
CAPITAL GAINS RECEIVED DEDUCTION
- ------------- ------------------
Class A............................ $ -- 1.58%
Class C............................ -- 1.58
For the year ended December 31, 2016, certain dividends paid by the Fund may be
subject to a maximum tax rate of 15%, as provided by the Jobs and Growth Tax
Relief Reconciliation Act of 2003. Of the distributions paid during the fiscal
year, $158,669 represents the maximum amount that may be considered qualified
dividend income.
36
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
COMPARISON: FUND VS. INDEX -- (UNAUDITED)
As required by the Securities and Exchange Commission, the graph on the
following pages compares the performance of a $10,000 investment in the Fund to
a similar investment in the index. Please note that the term "inception," as
used herein, reflects the date on which a specific class of shares commenced
operations. It is important to note that the Fund is a professionally managed
mutual fund while the index is not available for investment and is unmanaged.
The comparison is shown for illustrative purposes only. The graph presents the
performance of Class C shares of the Fund. The performance of the other class
will vary based upon the difference in sales charges and fees assessed to
shareholders of that class. Past performance does not predict future results.
37
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
COMPARISON: FUND VS. INDEX -- (UNAUDITED) (CONTINUED)
The Senior Floating Rate Fund (Class C) returned 9.76%, modestly
underperforming its benchmark, the S&P/LSTA Leveraged Loan Index (the "LLI"),*
which returned 10.16% for the annual period ended December 31, 2016.
In aggregate, industry allocation contributed favorably to the Fund's
results, driven primarily by an overweight position in energy, which rallied
along with the rebound in oil prices. An overweight to the wireless industry
also benefited the Fund's relative returns. Detractors from the Fund's relative
performance were its underweight allocation to metals and mining, which was the
second strongest industry in the LLI during the annual period, and its
overweight position in the food and beverage industry, which significantly
lagged the LLI during the annual period. An overweight to health care also
detracted given uncertainty about the future of the Affordable Care Act.
Compared to the LLI, an overweight position in loans rated CCC and lower
contributed positively to the Fund's relative performance, as lower quality
credit outperformed higher quality credit during the period. Security selection
as a whole also benefited the Fund's relative results. We had positioned the
Fund with a moderately pro-cyclical risk posture during the annual period,
which contributed to relative performance. Security selection within the
leisure, metals and mining, transportation and health care industries proved
most beneficial. This was partially offset by selection within the energy,
technology, chemicals and wirelines industries, which detracted.
Among individual loans, we found what we considered to be the best
opportunities among higher credit quality, U.S.-focused issuers. The individual
loans that contributed most positively to the Fund's absolute returns were
those of coal producer Arch Coal, fitness club owner and operator Town Sports
International, wireless handset insurance products and services provider
Asurion, global payment technology solutions company First Data and oil and gas
exploration and production company Chief Exploration & Development. Significant
detractors from the Fund's absolute returns included those of oil and gas
exploration and production company Everest Acquisition, diversified banking
institution Royal Bank of Scotland, clothing retailer Land's End, industrial
machinery and equipment wholesale distributor Philadelphia Energy Solutions and
crop input distributor and agriculture services provider Pinnacle Operating.
--------
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.
*The S&P/LSTA Leveraged Loan Index (LLI) reflects the market-weighted
performance of U.S. dollar-denominated institutional leveraged loans. The LLI
is the only domestic leveraged loan index that utilizes real-time market
weightings, spreads and interest payments. Indices are not managed and an
investor cannot invest directly into an index.
Securities listed may or may not be a part of current portfolio construction.
The Fund is not a money market fund and its net asset value may fluctuate.
Investments in loans involve certain risks including nonpayment of principal
and interest; collateral impairment; non-diversification and borrower industry
concentration; and lack of an active trading market, in certain cases, which
may impair the Fund's ability to obtain full value for loans sold. The Fund may
invest all or substantially all of its assets in loans or other securities
(e.g., unsecured loans or high yield securities) that are rated below
investment grade, or in comparable unrated securities. Credit risks include the
possibility of a default on the loan or bankruptcy of the borrower. The value
of these loans is subject to a greater degree of volatility in response to
interest rate fluctuations.
38
SUNAMERICA SENIOR FLOATING RATE FUND, INC.
COMPARISON: FUND VS. INDEX -- (UNAUDITED) (CONTINUED)
Over the past ten years, $10,000 invested in Senior Floating Rate Fund Class C
shares would have increased to $13,323. The same amount invested in securities
mirroring the performance of the S&P/LSTA Leveraged Loan Index++ would be
valued at $15,735, while the Bloomberg Barclays U.S. Aggregate Bond Index**
would be valued at $15,300.
[CHART]
Senior Floating S&P/LSTA Leveraged Bloomberg Barclays U.S.
Rate Class C Loan Index++ Aggregate Bond Index**
--------------- ------------------- ----------------------
12/31/2006 $10,000.00 $10,000.00 $10,000.00
1/31/2007 10,084.00 10,087.31 9,995.87
2/28/2007 10,153.00 10,156.66 10,150.02
3/31/2007 10,184.00 10,197.25 10,150.35
4/30/2007 10,246.00 10,257.83 10,205.09
5/31/2007 10,297.00 10,320.28 10,127.70
6/30/2007 10,315.00 10,343.28 10,097.76
7/31/2007 9,984.00 9,997.02 10,182.00
8/31/2007 9,995.00 10,020.27 10,306.80
9/30/2007 10,148.00 10,216.06 10,384.97
10/31/2007 10,214.00 10,313.59 10,478.27
11/30/2007 10,043.00 10,170.44 10,666.69
12/31/2007 10,043.00 10,202.22 10,696.66
1/31/2008 9,679.00 9,872.69 10,876.39
2/29/2008 9,424.00 9,625.06 10,891.44
3/31/2008 9,372.00 9,616.40 10,928.59
4/30/2008 9,685.00 9,972.65 10,905.77
5/31/2008 9,807.00 10,066.41 10,825.79
6/30/2008 9,844.00 10,091.56 10,817.11
7/31/2008 9,697.00 10,014.41 10,808.27
8/31/2008 9,676.00 10,001.33 10,910.81
9/30/2008 9,047.00 9,386.24 10,764.27
10/31/2008 7,569.00 8,145.65 10,510.19
11/30/2008 6,684.00 7,452.86 10,852.29
12/31/2008 6,184.00 7,233.34 11,257.21
1/31/2009 6,548.00 7,768.77 11,157.85
2/28/2009 6,495.00 7,829.32 11,115.72
3/31/2009 6,480.00 7,942.25 11,270.25
4/30/2009 7,275.00 8,632.88 11,324.19
5/31/2009 7,872.00 9,159.57 11,406.30
6/30/2009 8,384.00 9,561.09 11,471.14
7/31/2009 8,813.00 10,013.98 11,656.20
8/31/2009 9,070.00 10,240.75 11,776.89
9/30/2009 9,423.00 10,568.28 11,900.63
10/31/2009 9,596.00 10,626.79 11,959.40
11/30/2009 9,646.00 10,654.13 12,114.21
12/31/2009 9,909.00 10,967.33 11,924.81
1/31/2010 10,185.00 11,191.19 12,107.00
2/28/2010 10,191.00 11,223.33 12,152.19
3/31/2010 10,427.00 11,476.05 12,137.29
4/30/2010 10,584.00 11,644.75 12,263.64
5/31/2010 10,359.00 11,382.48 12,366.79
6/30/2010 10,287.00 11,329.32 12,560.73
7/31/2010 10,424.00 11,503.52 12,694.80
8/31/2010 10,472.00 11,542.50 12,858.12
9/30/2010 10,601.00 11,704.61 12,871.84
10/31/2010 10,745.00 11,887.90 12,917.64
11/30/2010 10,783.00 11,929.99 12,843.39
12/31/2010 10,901.00 12,078.11 12,704.90
1/31/2011 11,067.00 12,316.12 12,719.65
2/28/2011 11,151.00 12,373.14 12,751.47
3/31/2011 11,148.00 12,371.41 12,758.52
4/30/2011 11,197.00 12,450.26 12,920.50
5/31/2011 11,194.00 12,439.03 13,089.14
6/30/2011 11,150.00 12,393.01 13,050.80
7/31/2011 11,159.00 12,411.17 13,257.91
8/31/2011 10,615.00 11,864.49 13,451.62
9/30/2011 10,653.00 11,915.33 13,549.44
10/31/2011 10,912.00 12,259.82 13,564.02
11/30/2011 10,867.00 12,199.58 13,552.23
12/31/2011 10,908.00 12,261.77 13,701.18
1/31/2012 11,098.00 12,529.45 13,821.43
2/29/2012 11,174.00 12,626.08 13,818.27
3/31/2012 11,256.00 12,723.05 13,742.56
4/30/2012 11,323.00 12,817.00 13,894.96
5/31/2012 11,254.00 12,730.42 14,020.66
6/30/2012 11,320.00 12,818.31 14,026.16
7/31/2012 11,428.00 12,966.68 14,219.64
8/31/2012 11,540.00 13,112.42 14,228.96
9/30/2012 11,664.00 13,257.78 14,248.48
10/31/2012 11,678.00 13,299.70 14,276.50
11/30/2012 11,717.00 13,341.00 14,299.03
12/31/2012 11,803.00 13,445.90 14,278.67
1/31/2013 11,942.00 13,588.96 14,178.81
2/28/2013 11,950.00 13,617.44 14,249.91
3/31/2013 12,031.00 13,729.67 14,261.28
4/30/2013 12,139.00 13,811.59 14,405.62
5/31/2013 12,134.00 13,837.71 14,148.48
6/30/2013 12,055.00 13,755.98 13,929.66
7/31/2013 12,166.00 13,891.78 13,948.70
8/31/2013 12,160.00 13,886.56 13,877.36
9/30/2013 12,168.00 13,920.45 14,008.74
10/31/2013 12,265.00 14,021.83 14,121.99
11/30/2013 12,316.00 14,091.18 14,069.17
12/31/2013 12,365.00 14,156.94 13,989.67
1/31/2014 12,443.00 14,249.59 14,196.38
2/28/2014 12,461.00 14,274.71 14,271.83
3/31/2014 12,498.00 14,326.22 14,247.53
4/30/2014 12,487.00 14,342.41 14,367.79
5/31/2014 12,522.00 14,441.56 14,531.33
6/30/2014 12,585.00 14,524.60 14,538.84
7/31/2014 12,561.00 14,520.45 14,502.36
8/31/2014 12,583.00 14,542.91 14,662.47
9/30/2014 12,496.00 14,456.13 14,562.95
10/31/2014 12,518.00 14,493.57 14,706.08
11/30/2014 12,557.00 14,565.56 14,810.40
12/31/2014 12,367.00 14,382.78 14,824.25
1/31/2015 12,376.00 14,430.51 15,135.10
2/28/2015 12,568.00 14,634.10 14,992.80
3/31/2015 12,609.00 14,688.46 15,062.43
4/30/2015 12,725.00 14,823.58 15,008.38
5/31/2015 12,753.00 14,851.41 14,972.24
6/30/2015 12,684.00 14,789.29 14,808.98
7/31/2015 12,661.00 14,788.37 14,911.92
8/31/2015 12,546.00 14,684.93 14,890.51
9/30/2015 12,441.00 14,589.56 14,991.23
10/31/2015 12,436.00 14,562.93 14,993.72
11/30/2015 12,285.00 14,435.36 14,954.10
12/31/2015 12,138.00 14,283.79 14,905.77
1/31/2016 12,034.00 14,190.52 15,110.89
2/29/2016 11,977.00 14,115.75 15,218.08
3/31/2016 12,323.00 14,504.75 15,357.71
4/30/2016 12,573.00 14,792.69 15,416.65
5/31/2016 12,694.00 14,924.57 15,420.60
6/30/2016 12,700.00 14,927.72 15,697.68
7/31/2016 12,869.00 15,141.26 15,796.92
8/31/2016 12,957.00 15,254.97 15,778.85
9/30/2016 13,060.00 15,386.75 15,769.61
10/31/2016 13,149.00 15,513.76 15,648.99
11/30/2016 13,168.00 15,554.82 15,278.83
12/31/2016 13,323.00 15,735.68 15,300.37
Class A Class C
Senior -------------------------------------
Floating Average Average
Rate Annual Cumulative Annual Cumulative
Fund# Return Return+ Return Return+
- -------------------------------------
1 Year Return 5.90% 10.08% 8.76% 9.76%
-------------------------------------------------------
5 Year Return 3.60% 23.97% 4.08% 22.13%
-------------------------------------------------------
10 Year Return 2.83% 37.42% 2.91% 33.23%
-------------------------------------------------------
Since Inception* 2.94% 39.82% 3.76% 96.70%
-------------------------------------------------------
# For the purposes of the table, it has been assumed that
the maximum sales charge of 3.75% with respect to Class
A shares was deducted from the initial investment in
the Fund and that the CDSCs with respect to the Class C
shares have been deducted, as applicable.
+ Cumulative returns do not include sales load. If sales
load had been included, the return would have been
lower.
* Inception date: Class A: 10/04/2006; Class C:
08/31/1998.
++ The S&P/LSTA Leveraged Loan Index (LLI) reflects the
market-weighted performance of U.S. dollar-denominated
institutional leveraged loan portfolios. The LLI is the
only domestic leveraged loan index that utilizes
real-time market weightings, spreads and interest
payments.
** The Bloomberg Barclays U.S. Aggregate Bond Index
represents securities that are U.S. domestic, taxable
and dollar denominated. The index covers components for
government and corporate securities, mortgage
pass-through securities and asset-backed securities.
Indices are not managed and an investor cannot invest
directly into an index.
The Fund operated as a closed-end investment company with
monthly repurchase offers until October 4, 2006, whereupon
it converted to an open-end investment company.
Information in the graph and table reflects performance of
the Fund as a closed-end investment company through
October 3, 2006, and the Fund may have performed
differently if it were an open-end investment company
prior to that date.
For the 12 month period ended December 31, 2016, the
SunAmerica Senior Floating Rate Class C returned 8.76%
compared to 10.16% for the S&P/LSTA Leveraged Loan Index
and 2.65% for the Bloomberg Barclays U.S. Aggregate Bond
Index. (The performance data and graph do not reflect the
deduction of taxes that a shareholder would pay on fund
distributions or the redemption of fund shares.)
--------
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE AND IS NO GUARANTEE OF
FUTURE RESULTS. Maximum Sales Charge: Class A: 3.75%; Contingent Deferred Sales
Charge (CDSC): Class C: 1.00% CDSC. The fund's daily net asset values are not
guaranteed and shares are not insured by the FDIC, the Federal Reserve Board or
any other agency. The investment return and principal value of an investment
will fluctuate so that an investor's shares, when redeemed, may be higher or
lower than the original cost. Current performance may be higher or lower than
that shown. Performance as of the most recent month end is available at
www.safunds.com
39
[LOGO] AIG Sun America
Mutual Funds
HARBORSIDE 5
185 HUDSON STREET, SUITE 3300
JERSEY CITY, NJ 07311
DIRECTORS CUSTODIAN DISCLOSURE OF QUARTERLY
Dr. Judith L. Craven State Street Bank and PORTFOLIO HOLDINGS
William F. Devin Trust Company The Fund is required to
Richard W. Grant One Lincoln St. file its com-plete
Stephen J. Gutman Boston, MA 02111 schedule of portfolio
Peter A. Harbeck VOTING PROXIES ON FUND holdings with the U.S.
William J. Shea PORTFOLIO SECURITIES Securities and Exchange
OFFICERS A description of the Commission for its first
John T. Genoy, President policies and proce-dures and third fiscal quarters
and Chief Executive that the Fund uses to on Form N-Q. The Fund's
Officer determine how to vote Forms N-Q are available
James Nichols, Vice proxies related to on the U.S. Securities
President securities held in the and Exchange Commission's
Matthew Hackenthal, Fund's portfolio, which website at
Acting Chief is available in the http://www.sec.gov. You
Compliance Officer Fund's Statement of can also review and
Gregory N. Bressler, Additional Information obtain copies of the
Secretary may be ob-tained without Forms N-Q at the U.S.
Gregory R. Kingston, charge upon request, by Securities and Exchange
Treasurer calling (800) 858-8850. Commission's Public
Kathleen Fuentes, Chief This in-formation is also Refer-ence Room in
Legal Officer and available from the EDGAR Washington, DC
Assistant Secretary database on the U.S. (information on the
Matthew J. Hackethal, Secu-rities and Exchange operation of the Public
Anti-Money Laundering Commission's website at Reference Room may be
Compliance Officer http://www.sec.gov. ob-tained by calling
Donna McManus, Vice DELIVERY OF SHAREHOLDER 1-800-SEC-0330).
President and DOCUMENTS PROXY VOTING RECORD ON
Assistant Treasurer The Fund has adopted a FUND PORTFOLIO SECURITIES
Shawn Parry, Vice policy that allows it to Information regarding how
President and send only one copy of the the Fund voted proxies
Assistant Treasurer Fund's prospectus, proxy relating to securities
INVESTMENT ADVISER material, annual report held in the Fund's
SunAmerica Asset and semi-annual report portfolio during the most
Management, LLC (the "shareholder recent twelve month
Harborside 5 documents") to period ended June 30 is
185 Hudson Street, Suite shareholders with available, once filed
3300 multiple accounts with the U.S. Securities
Jersey City, NJ 07311 residing at the same and Exchange Commis-sion,
DISTRIBUTOR "household." This without charge, upon
AIG Capital Services, practice is called request, by calling
Inc. householding and reduces (800) 858-8850 or on the
Harborside 5 Fund expenses, which U.S. Securities and
185 Hudson Street, Suite benefits you and other Exchange Commission's
3300 shareholders. Unless the website at
Jersey City, NJ 07311 Fund receives http://www.sec.gov.
SHAREHOLDER SERVICING instructions to the This report is submitted
AGENT con-trary, you will only solely for the general
SunAmerica Fund receive one copy of the information of
Services, Inc. shareholder documents. shareholders of the Fund.
Harborside 5 The Fund will continue to Distribution of this
185 Hudson Street, Suite household the report to persons other
3300 share-holder documents than shareholders of the
Jersey City, NJ 07311 indefinitely, until we Fund is authorized only
TRANSFER AGENT are instructed otherwise. in connection with a
State Street Bank and If you do not wish to currently effective
Trust Company participate in prospectus, setting forth
P.O. Box 219373 householding, please details of the Fund,
Kansas City, MO 64141 contact Shareholder which must precede or
Services at (800) accompany this report.
858-8850 ext. 6010 or
send a written request
with your name, the name
of your fund(s) and your
account number(s) to
SunAmerica Mutual Funds
c/o BFDS, P.O. Box
219186, Kansas City MO,
64121-9186. We will
resume individual
mailings for your account
within thirty (30) days
of receipt of your
request.
[GRAPHIC]
GO PAPERLESS!!
DID YOU KNOW THAT YOU HAVE THE OPTION TO
RECEIVE YOUR SHAREHOLDER REPORTS ONLINE?
By choosing this convenient service, you will no longer receive paper copies of
Fund documents such as annual reports, semi-annual reports, prospectuses and
proxy statements in the mail. Instead, you are provided with quick and easy
access to this information via the Internet.
Why Choose Electronic Delivery?
IT'S QUICK -- Fund documents will be received faster than via traditional mail.
IT'S CONVENIENT -- Elimination of bulky documents from personal files.
IT'S COST EFFECTIVE -- Reduction of your Fund's printing and mailing costs.
TO SIGN UP FOR ELECTRONIC DELIVERY, FOLLOW
THESE SIMPLE STEPS:
1 GO TO WWW.SAFUNDS.COM
2 CLICK ON THE LINK TO "GO PAPERLESS!!"
The email address you provide will be kept strictly confidential. Once your
enrollment has been processed, you will begin receiving email notifications
when anything you receive electronically is available online.
You can return to www.safunds.com at any time to change your email
address, edit your preferences or to cancel this service if you choose to
resume physical delivery of your Fund documents.
Please note - this option is only available to accounts opened through the
Funds.
FOR INFORMATION ON RECEIVING THIS REPORT ONLINE, SEE INSIDE BACK COVER.
DISTRIBUTED BY:
AIG CAPITAL SERVICES, INC.
This fund report must be preceded by or accompanied by a prospectus.
Investors should carefully consider a Fund's investment objectives, risks,
charges and expenses before investing. The prospectus, containing this and
other important information, can be obtained from your financial adviser, the
SunAmerica Sales Desk at 800-858-8850, ext. 6003, or at www.safunds.com. Read
the prospectus carefully before investing.
WWW.SAFUNDS.COM
SFANN - 12/16
[LOGO]
Sun America
Mutual Funds
Item 2. Code of Ethics
The SunAmerica Senior Floating Rate Fund, Inc. (the "registrant") has
adopted a Code of Ethics applicable to its Principal Executive and
Principal Accounting Officers pursuant to Section 406 of the Sarbanes-Oxley
Act of 2002. During the fiscal year ended 2016, there were no reportable
amendments, waivers or implicit waivers to a provision of the Code of
Ethics that applies to the registrant's Principal Executive and Principal
Accounting Officers.
Item 3. Audit Committee Financial Expert.
Currently, the registrant does not have an Audit Committee member who
possesses all of the attributes required to be an "audit committee
financial expert," as defined in instruction 2(b) of Item 3 of Form N-CSR.
However, the Board of Directors believes that the members of the Audit
Committee have substantial experience relating to the review of financial
statements and the operations of audit committees. Accordingly, the Board
believes that the members are qualified to evaluate the registrant's
financial statements, supervise the registrant's preparation of its
financial statements, and oversee the work of the registrant's independent
auditors.
Item 4. Principal Accountant Fees and Services.
(a)--(d) Aggregate fees billed to the registrant for the last two fiscal
years for professional services rendered by the registrant's principal
accountant were as follows:
2015 2016
-------- --------
(a) Audit Fees $101,531 $104,777
(b) Audit-Related Fees $ 0 $ 0
(c) Tax Fees $ 15,409 $ 15,872
(d) All Other Fees $ 0 $ 0
Audit Fees include amounts related to the audit of the registrant's annual
financial statements and services normally provided by the principal
accountant in connection with statutory and regulatory filings. Tax Fees
principally include tax compliance, tax advice, tax planning and
preparation of tax returns.
Aggregate fees billed to the investment adviser and Adviser Affiliates (as
defined below in Item 4(e)) that are required to be pre-approved pursuant
to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X for the last two
fiscal years for services rendered by the registrant's principal accountant
were as follows:
2015 2016
------- -------
(b) Audit-Related Fees $ 0 $ 0
(c) Tax Fees $ 0 $ 0
(d) All Other Fees $17,640 $ 0
(e) (1) The registrant's audit committee pre-approves all audit services
provided by the registrant's principal accountant for the registrant
and all non-audit services provided by the registrant's principal
accountant for the registrant, its investment adviser and any entity
controlling, controlled by, or under common control with the
investment adviser ("Adviser Affiliates") that provides ongoing
services to the registrant, if the engagement by the investment
adviser or Adviser Affiliate relates directly to the operations and
financial reporting of the registrant. The audit committee has not
presently established any pre-approval policies and procedures that
permit the pre-approval of the above services other than by the full
audit committee. Certain de minimis exceptions are allowed for non-
audit services in accordance with Rule 2-01(c)(7)(i)(C) of Regulation
S-X as set forth in the registrant's audit committee charter.
(2) No services included in (b)-(d) above in connection with fees
billed to the registrant or the investment adviser or Adviser
Affiliates were approved pursuant to paragraph (c)(7)(i)(C) of Rule
2-01 of Regulation S-X.
(f) Not applicable.
(g) The aggregate fees billed for the most recent fiscal year and the
preceding fiscal year by the registrant's principal accountant for
non-audit services rendered to the registrant, its investment adviser,
and Adviser Affiliates that provides ongoing services to the
registrant for 2015 and 2016 were $52,074 and $15,872, respectively.
(h) Not applicable.
Item 5. Audit Committee of Listed Registrants.
Not applicable.
Item 6. Investments.
Included in Item 1 to the Form.
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 were no material changes to the procedures by which shareholders may
recommend nominees to the registrant's Board of Directors that were
implemented after the registrant last provided disclosure in response to
the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR 229.407)
(as required by 22(b)(15) of Schedule 14A (17 CFR 240.14a-101)), or this
Item 10.
Item 11. Controls and Procedures.
(a) An evaluation was performed within 90 days of the filing of this
report, under the supervision and with the participation of the
registrant's management, including the President and Treasurer, of the
effectiveness of the design and operation of the registrant's
disclosure controls and procedures (as defined under Rule 30a-3(c)
under the Investment Company Act of 1940 (17 CFR 270.30a-3(c))). Based
on that evaluation, the registrant's management, including the
President and Treasurer, concluded that the registrant's disclosure
controls and procedures are effective.
(b) There was no change in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the Investment
Company Act of 1940 (17 CFR 270.30a-3(d))) that occurred during the
registrant's last fiscal quarter of the period covered by this report
that has materially affected, or is reasonably likely to materially
affect, the registrant's internal contro1 over financial reporting.
Item 12. Exhibits.
(a) (1) Code of Ethics applicable to its Principal Executive and Principle
Accounting Officers pursuant to Section 406 of the Sarbanes-Oxley Act
of 2002 attached hereto as Exhibit 99.406. Code of Ethics.
(2) Certifications pursuant to Rule 30a-2(a) under the Investment
Company Act of 1940 (17 CFR 270.30a-2(a)) attached hereto as Exhibit
99.CERT.
(3) Not applicable.
(b) Certification pursuant to Rule 30a-2(b) under the Investment Company
Act of 1940 (17 CFR 270.30a-2(a)) and Section 906 of the Sarbanes-
Oxley Act of 2002 attached hereto as Exhibit 99.906.CERT.
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.
SunAmerica Senior Floating Rate Fund, Inc.
By: /s/ John T. Genoy
------------------------------------
John T. Genoy
President
Date: March 9, 2017
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/ John T. Genoy
------------------------------------
John T. Genoy
President
Date: March 9, 2017
By: /s/ Gregory R. Kingston
------------------------------------
Gregory R. Kingston
Treasurer
Date: March 9, 2017