BNY Mellon High Yield Strategies Fund Permitted to Invest Up to 20% of Total Assets in Floating Rate Loans

On Thursday, August 8, 2024, the Board of Trustees of BNY Mellon High Yield Strategies Fund (NYSE: DHF) approved a proposal, effective August 15, 2024, to permit BNY Mellon High Yield Strategies Fund (the “Fund”) to invest up to 20% of the Fund’s total assets in floating rate loans.

The Fund's investments in floating rate loans will be generally focused on senior secured loans but also may include second lien loans, senior unsecured loans, subordinated loans, and fixed rate loans with respect to which the Fund has entered into derivative instruments (principally swap agreements and options on swap agreements) to effectively convert the fixed rate interest payments into floating rate interest payments. The Fund also may purchase participations and assignments in, and commitments to purchase, floating rate loans. Investments in floating rate loans and other floating rate securities generally will focus on U.S. issuers, but the Fund may invest in foreign issuers, typically those located in foreign countries that are members of the Organisation for Economic Co-operation and Development.

Unlike publicly traded common stocks which trade on national exchanges, there is no central market or exchange for loans to trade. Loans trade in an over-the-counter market, and confirmation and settlement, which are effected through standardized procedures and documentation, may take significantly longer than seven days to complete. The secondary market for floating rate loans also may be subject to irregular trading activity and wide bid/ask spreads. The lack of an active trading market for certain floating rate loans may impair the ability of the Fund to realize full value in the event of the need to sell a floating rate loan and may make it difficult to value such loans. There may be less readily available, reliable information about certain floating rate loans than is the case for many other types of securities, and the Fund's portfolio managers may be required to rely primarily on their own evaluation of a borrower's credit quality rather than on any available independent sources. The value of collateral, if any, securing a floating rate loan can decline, and may be insufficient to meet the issuer's obligations in the event of non-payment of scheduled interest or principal or may be difficult to readily liquidate. In the event of the bankruptcy of a borrower, the Fund could experience delays or limitations imposed by bankruptcy or other insolvency laws with respect to its ability to realize the benefits of the collateral securing a loan. The floating rate loans in which the Fund may invest typically will be below investment grade quality and, like other below investment grade securities, are inherently speculative. As a result, the risks associated with such floating rate loans are similar to the risks of below investment grade securities, although senior loans are typically senior and secured in contrast to other below investment grade securities, which are often subordinated and unsecured. Floating rate loans may not be considered to be "securities" for purposes of the anti-fraud protections of the federal securities laws, including those with respect to the use of material non-public information, so that purchasers, such as the Fund, may not have the benefit of these protections.

Holders of securities that are subordinated or "junior" to more senior securities of an issuer are entitled to payment after holders of more senior securities of the issuer. Subordinated securities are more likely to suffer a credit loss than non-subordinated securities of the same issuer, any loss incurred by the subordinated securities is likely to be proportionately greater, and any recovery of interest or principal may take more time. As a result, even a perceived decline in creditworthiness of the issuer is likely to have a greater impact on the market value of these securities. Subordinated loans generally are subject to similar risks as those associated with investments in senior loans, except that such loans are subordinated in payment and/or lower in lien priority to first lien holders. Consequently, subordinated loans generally have greater price volatility than senior loans and may be less liquid. The risks associated with subordinated unsecured loans, which are not backed by a security interest in any specific collateral, are higher than those for comparable loans that are secured by specific collateral.

A participation interest gives the Fund an undivided interest in a loan in the proportion that the Fund's participation interest bears to the total principal amount of the loan, but does not establish any direct relationship between the Fund and the borrower. If a floating rate loan is acquired through a participation, the Fund generally will have no right to enforce compliance by the borrower with the terms of the loan agreement against the borrower, and the Fund may not directly benefit from the collateral supporting the debt obligation in which it has purchased the participation. As a result, the Fund will be exposed to the credit risk of both the borrower and the institution selling the participation. The Fund also may invest in a loan through an assignment of all or a portion of such loan from a third party. If a floating rate loan is acquired through an assignment, the Fund may not be able to unilaterally enforce all rights and remedies under the loan and with regard to any associated collateral.

Because there may be a lack of centralized information and trading for certain loans in which the Fund may invest, reliable market value quotations may not be readily available for such loans and their valuation may require more research than for securities with a more developed secondary market. Moreover, the valuation of such loans may be affected by uncertainties in the conditions of the financial market, unreliable reference data, lack of transparency and inconsistency of valuation models and processes.

This press release is published solely for informational purposes and is not to be construed as specific tax, legal or investment advice. Nor is this document intended as a solicitation or an offer to buy or sell securities or related financial instruments. The release should not be regarded by recipients as a substitute for exercise of their own judgment. Statements made in this release are based on current market conditions. Different market conditions and assumptions could have materially different results. Neither BNY Investment Adviser, Inc. “BNY Investment Adviser”), the Fund nor any of their affiliates, directors, employees or agents accept any liability for any loss or damage arising out of the use of all or any part of this release.

Certain statements contained in this release may be forward-looking in nature. Such statements represent current beliefs, based on information available at the time the statements are made, with regard to matters addressed. Actual future occurrences may differ significantly from those anticipated in any forward-looking statements due to numerous factors. These include, but are not limited to, those noted above, and other additional risks and uncertainties. The Fund, BNY Investment Adviser and any of their affiliates, directors, employees or agents undertake no responsibility to update publicly or revise any forward- looking statements.

Important Information

BNY Mellon Investment Adviser, Inc., the investment adviser for the Fund, is part of BNY Investments. BNY Investments is one of the world’s largest asset managers, with $2.0 trillion in assets under management as of June 30, 2024. Through a client-first approach, BNY Investments brings investors specialist expertise through its seven investment firms offering solutions across every major asset class and backed by the breadth and scale of BNY. Additional information on BNY Investments is available on www.bnymellonim.com. Follow us on LinkedIn for the latest company news and activity.

BNY Investments is a division of BNY, which has $49.5 trillion in assets under custody and/or administration as of June 30, 2024. Established in 1784, BNY is America's oldest bank. Today, BNY powers capital markets around the world through comprehensive solutions that help clients manage and service their financial assets throughout the investment life cycle. BNY is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). Additional information is available on www.bnymellon.com. Follow us on LinkedIn or visit our newsroom for the latest company news.

Closed-end funds are traded on the secondary market through one of the stock exchanges. The Fund's investment returns and principal values will fluctuate so that an investor’s shares may be worth more or less than the original cost. Shares of closed-end funds may trade above (a premium) or below (a discount) the net asset value of the fund’s portfolio. There is no assurance that the Fund will achieve its investment objective.

This release is for informational purposes only and should not be considered as investment advice or a recommendation of any particular security.

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