OREANDA-NEWS. September 15, 2015.  Fitch Ratings has affirmed the ratings for the following notes and preferred stock issued by Neuberger Berman High Yield Strategies Fund Inc. (NYSE: NHS), a non-diversified, closed-end fund advised by Neuberger Berman Management LLC (Advisor):

--\\$90,000,000 floating rate senior notes, series A, due September 2023 at 'AAA';
--\\$35,000,000 mandatory redeemable preferred shares (MRPS) - series B, due September 2023 at 'AA'.

KEY RATING DRIVERS

The rating affirmations reflect:

--Sufficient asset coverage provided to the notes and MRPS as calculated per Fitch's asset coverage tests and published rating criteria;
--The structural protections afforded by mandatory asset coverage and de-leveraging provisions in the event of asset coverage declines;
--The legal and regulatory parameters that govern the fund's operations;
--The capabilities of the fund's adviser.

FUND PROFILE
NHS, through its predecessor fund, commenced operations on July 28, 2003. The fund's primary investment objective is to seek high total return and invests primarily in high yield debt securities to pursue that objective. NHS is a non-diversified closed-end fund, and has a policy where at least 80% of the fund must be invested in below investment-grade (high yield) debt securities (including corporate loans) of U.S. and foreign issuers. As of July 31, 2015, the fund managed \\$403 million in assets, consisting of 88% in corporate high yield bonds, 8% in bank loans and 4% in cash and cash equivalents.

NHS has the ability to enter into interest rate swap contracts for the purposes of hedging. As of July 31, 2015, NHS had four swaps outstanding, with various maturity dates, representing \\$120 million in notional amount. The interest rate swaps are used to hedge the fund's floating-rate cost of funding.

FUND LEVERAGE
The floating-rate notes and MRPS represented 22% and 9%, respectively, of the fund's total 31% leverage as of the same date. The notes and MRPS are the sole form of structural leverage of the fund following the Sept. 18, 2013 issuance.

ASSET COVERAGE
At the time of the affirmation, the fund's asset coverage ratio for the notes, as calculated in accordance with the Investment Company Act of 1940 (1940 Act), exceeded 300%, and the fund's asset coverage ratio for the MRPS, also as calculated in accordance with the 1940 Act, exceeded 200%, which are the minimum asset coverage ratios required by the 1940 Act and the transactional documents. The fund's asset coverage ratios as calculated in accordance with Fitch's overcollateralization (OC) tests described in Fitch's published criteria exceeded 100%, which is also the minimum asset coverage required by transactional documents.

The test calculates standardized asset coverage by applying haircuts to portfolio holdings based on perceived riskiness and diversification of the assets and measuring its ability to cover both on- and off-balance sheet liabilities, if any, at the assigned rating stress level.

STRUCTURAL PROTECTIONS
Should the asset coverage tests decline below their minimum threshold amounts, under the terms of both the notes and MRPS, the fund is required to cure any breaches by altering the composition of the portfolio toward assets with lower discount factors (for Fitch OC Tests breaches), or by reducing leverage in a sufficient amount (for all test breaches) within a pre-specified time period.

Failure to cure an asset coverage breach, as described above, is an event of default under the terms of the notes. The fund must then deliver a notice within five business days to the note purchasers and a majority vote of note purchasers may then declare all the notes then outstanding to be immediately due and payable.

THE FUND'S ADVISER
Neuberger Berman Management LLC is an indirect subsidiary of Neuberger Berman Group LLC, which is a private, independent, employee-controlled investment manager founded in 1939. The firm employed more than 2,100 employees and managed \\$251 billion in assets across equities, fixed income, hedge funds and private equity as of June 30, 2015.

RATING SENSITIVITIES
The ratings assigned to the notes and preferred shares may be sensitive to material changes in the leverage composition, portfolio credit quality, or market risk of the fund, as described above. A material adverse deviation from Fitch guidelines for any key rating driver could cause the ratings to be lowered by Fitch.