SEC Company Response from Natixis Funds Trust II (CIK 0000052136) — Aug 20, 2021
Natixis Funds Trust II (CIK 0000052136)
Date: Aug. 20, 2021 · CIK: 0000052136 · Accession: 0001193125-21-252637
AI Filing Summary & Sentiment
File numbers found in text: 811-00242, 811-04323, 811-06241, 811-08282, 811-22099, 811-23146, 811-23500
Letter
Division of Investment Management Attention: Christina Fettig VIA EDGAR Natixis ETF Trust II: 811-23500 Gateway Trust: 811-22099 Loomis Sayles Funds I: 811-08282 Loomis Sayles Funds II: 811-06241
Dear Ms. Fettig,
This letter responds to your comments received by telephone on July 2, 2021 (and corresponding follow-up comments received by telephone on August 2, 2021) regarding certain filings by the above-referenced registrants (each, a “Registrant”) on behalf of certain of their series funds (each, a “Fund”). For your convenience, we have summarized each comment below, followed by the Registrants’ responses. Any term that is used, but not defined, in this letter retains the same meaning as used by the Registrants in their respective filings.
1. Comment: Benchmark Indices – Loomis Sayles Strategic Alpha Fund and AlphaSimplex Global Alternatives Fund. Please explain how the benchmark indices were determined to be broadbased securities indices for the aforementioned funds. Specifically, for Loomis Sayles Strategic Alpha Fund, explain the use of 3-month LIBOR and 3-month LIBOR +300 basis points as broad based indices and, for AlphaSimplex Global Alternatives Fund, explain the use of Barclay Fund of Funds Index when the AlphaSimplex Global Alternatives Fund is not a fund of funds.
Response: The Registrants seek to align each Fund’s investment objective, strategy and underlying asset classes with an appropriate benchmark relative to those factors. For some funds this is a relatively straightforward process, but for others this is more complicated, particularly for funds like the AlphaSimplex Global Alternatives Fund and the Loomis Sayles Strategic Alpha Fund which have more differentiated investment strategies, as described more fully below.
AlphaSimplex Global Alternatives Fund – as disclosed in the Fund’s prospectus, “the Fund pursues an absolute return strategy that seeks to provide capital appreciation consistent with the risk-return characteristics of a diversified portfolio of hedge funds. The secondary goal of the Fund is
to achieve these returns with less volatility than major equity indices.” The Barclay Fund of Funds Index is a measure of the average net return of all hedge fund of funds in the Barclay database. The Registrant believes this benchmark is an appropriate comparison for the Fund because hedge fund of funds are intended to be diversified portfolios of hedge funds. This is consistent with the Fund’s investment goals of providing capital appreciation “consistent with the risk-return characteristics of a diversified portfolio of hedge funds.”
Loomis Sayles Strategic Alpha Fund – as disclosed in the Fund’s prospectus, “the Fund seeks to provide an attractive absolute total return, complemented by prudent investment management designed to manage risk and protect investor capital. The secondary goal of the Fund is to achieve these returns with relatively low volatility.” The Fund has two comparative benchmarks, 3-Month LIBOR and 3-Month LIBOR +300 basis points. (As you may know, LIBOR is generally representative of short-term interest rates.) The Registrant believes that both comparative benchmarks are appropriate.
The selection of 3-Month LIBOR is consistent with the Fund’s absolute total return investment objective. The Fund’s prospectus describes this objective as follows: “The Fund has an absolute total return investment objective, which means that it is not managed relative to an index and that it attempts to achieve positive total returns over a full market cycle.” Many products with an absolute total return investment objective have LIBOR as a comparative index because they are not being managed relative to an index and because LIBOR, as a measure of short-term rates, is expected to be positive over time, consistent with the Fund’s investment objective.
The Fund also shows performance relative to 3-Month LIBOR +300 basis points. The Registrant believes this benchmark is appropriate because it is consistent with the Fund’s investment objective and with the anticipated risk and return targets of the Fund as specified by its portfolio managers.
Follow-up Comment: In reference to the above response, the Staff notes that the 3-month LIBOR and the 3-month LIBOR +300 basis points benchmarks are not securities market indices and reiterate its comment to include a broad based index for the Loomis Sayles Strategic Alpha Fund.
Follow-up Response: The Registrant respectfully submits that the 3-month LIBOR and the 3-month LIBOR +300 basis points are appropriate measures against which to compare the Fund’s performance. LIBOR is a benchmark interest rate index, which represents the average rate a leading bank, for a given currency, can obtain unsecured funding, and is representative of short-term interest rates. Item 27(b)(7), Instruction 5 of Form N-1A defines an appropriate index as “one that is administered by an organization that is not an affiliated person of the Fund, its investment adviser, or principal underwriter, unless the index is widely recognized and used.” The Registrant believes that the 3-month LIBOR and the 3-month LIBOR +300 basis points appropriately meet this definition and notes that several other funds use similar LIBOR benchmarks as the broad-based indexes against which they measure their performance.
However, although the Registrant believes that its current indices are appropriate, it recognizes that the pending discontinuation of LIBOR will require a change to its benchmark indices, and it will incorporate the Staff’s comments in selecting a new index when a reliable LIBOR benchmark is no longer available.
2. Comment: Top Ten Holdings – Loomis Sayles Global Allocation Fund (and any other fund that discloses a Top Ten Holdings table). Consider adding clarifying disclosure to the Top Ten Holdings table to specify that the securities listed are presented on an individual security basis and do not represent holdings of the issuer.
Response: In future filings, the Registrants will include clarifying disclosure to the Top Ten Holdings table to specify that the securities listed are presented on an individual security basis and do not represent holdings of the issuer.
3. Comment: Top Ten Holdings – Vaughan Nelson Mid Cap Fund and Vaughan Nelson Small Cap Value Fund. Verify the accuracy of the Funds’ Top Ten Holdings tables as compared to each applicable Portfolio of Investments.
Response: Due to human error, the wrong Top Ten Holdings tables were included in the December 31, 2020 annual report for Vaughan Nelson Mid Cap Fund and Vaughan Nelson Small Cap Value Fund. As this error indicates a potential deficiency in the Funds’ internal controls over financial reporting, the Registrants have assessed such control deficiency to determine if it constitutes a significant deficiency or material weakness and whether restatement of the Funds’ financial statements is required. The Registrants have concluded that this control deficiency is not a significant deficiency or material weakness as defined by Securities and Exchange Commission (“SEC”) rules and does not require a restatement of the Funds’ financial statements. The Registrants’ conclusion is based on the fact that the Funds have procedures to review and verify Top Ten Holdings tables and it was a failure to follow such procedures that resulted in the wrong Top Ten Holdings tables being included in the Funds’ financial statements. Additionally, the Registrants confirm that, at the time of the mailing of the applicable financial statements, the correct Top Ten Holdings tables had been available to shareholders on the Funds’ website, Fact Sheets and other marketing materials. The Registrants believe this error to be an isolated incident and have added clarification to existing written procedures regarding the reconciliation of Top Ten Holdings tables to Portfolios of Investments. Additionally, the Registrants have reinforced with the appropriate personnel the proper procedure to review and verify Top Ten Holdings information included in the Registrants’ annual reports.
Follow-up Comment: In reference to the above response, have the Registrants considered amending the Form N-CSR filings to correct the Top Ten Holdings disclosures for Vaughan Nelson Mid Cap Fund and Vaughan Nelson Small Cap Value Fund as of the year ended December 31, 2020?
Follow-up Response: Based on an evaluation by the Funds’ investment adviser, Natixis Advisors, LLC, of the impact of inclusion of the wrong Top Ten Holdings tables in the December 31, 2020 annual report for Vaughan Nelson Mid Cap Fund and Vaughan Nelson Small Cap Value Fund, the Registrants determined that the errors were not material to the Funds’ December 31, 2020 financial statements, taken as a whole, for the reasons stated above. Accordingly, the Registrants have concluded that the errors did not require the filing of an amended Form N-CSR.
4. Comment: Diversification – Loomis Sayles Growth Fund. Confirm that Loomis Sayles Growth Fund meets the diversification requirements as set forth in Section 5(b)(1) of the Investment Company Act of 1940, as amended (the “1940 Act”).
Response: The Registrant, on behalf of the Fund, confirms that the Fund was in compliance with the requirements set forth in Section 5(b)(1) of the 1940 Act as of September 30, 2020 and all prior fiscal quarter ends and continues to remain in compliance with those requirements. The Registrant notes that Section 5(c) of the 1940 Act states that “a registered diversified company which at the time of its qualification as such meets the requirements of paragraph (1) of subsection (b) shall not lose its status as a diversified company because of any subsequent discrepancy between the value of its various investments and the requirements of said paragraph, so long as any such discrepancy existing immediately after its acquisition of any security or other property is neither wholly nor partly the result of such acquisition.”
5. Comment: Non-Diversified Investment Company Status – Loomis Sayles Senior Floating Rate and Fixed Income Fund, Loomis Sayles Strategic Alpha Fund, and Mirova Global Green Bond Fund. Each of the above-referenced Funds are disclosed as being non-diversified investment companies in their respective prospectuses and financial statements. Based on our review of each Fund’s Portfolio of Investments, the aforementioned Funds appear to be diversified investment companies. Confirm that if a non-diversified registered fund continues to operate as diversified investment company for more than 3 years, then the Fund will obtain shareholder approval before being reclassified as a non-diversified investment company. Verify the non-diversified investment company status of each of the above-referenced Funds.
Response: The Registrants acknowledge that the above-referenced Funds have operated as diversified investment companies for more than 3 years, continue to operate as diversified investment companies as of the date of this letter, and expect to operate as diversified investment companies going forward. The Registrants will amend each Fund’s prospectus disclosure regarding diversification status during the next annual registration statement update on April 1, 2022 for the Loomis Sayles Senior Floating Rate and Fixed Income Fund and on May 1, 2022 for the Loomis Sayles Strategic Alpha Fund and Mirova Global Green Bond Fund. Until such time as the Funds’ registration statements are amended, the Registrants confirm that each Fund will reflect in its financial statements and other filings the Fund’s status as a diversified investment company.
6. Comment: Concentration of Risk – AlphaSimplex Global Alternatives Fund. Going forward, AlphaSimplex Global Alternatives Fund should evaluate including any additional tabular representations of fund holdings representing other significant types of concentrations of risk in its Portfolio of Investments. If so, include associated additional risk disclosure in the Notes to Financial Statements. Please refer to ASC 825-10-50 for relevant disclosure requirements.
Response: In future filings, the Registrant will evaluate the appropriateness of including additional tabular representations of fund holdings representing other significant concentrations of risk in its Portfolio of Investments, along with corresponding risk disclosure in the Notes to Financial Statements.
7. Comment: Significant Other Expenses – Natixis Loomis Sayles Short Duration Income ETF, Natixis U.S. Equity Opportunities ETF, Natixis Vaughan Nelson Mid Cap ETF, and Natixis Vaughan Nelson Select ETF. For the above-referenced Funds, verify whether all significant other expenses (any expense item which exceeds five percent of the total expenses) have been appropriately disclosed as separate line items on the Statements of Operations as required per Rule 6-07 (2)(b) of Regulation S-X.
Response: Due to human error, fees associated with Form N-PORT preparation, which exceeded five percent of total expenses for Natixis Vaughan Nelson Mid Cap ETF and Natixis Vaughan Nelson Select ETF, were not disclosed as a separate line item on the Statements of Operations. As this error indicates a potential deficiency in the Funds’ internal controls over financial reporting, the Registrants have assessed such control deficiency to determine if it constitutes a significant deficiency or material weakness and whether restatement of the Funds’ financial statements is required. The Registrants have concluded that this control deficiency is not a significant deficiency or material weakness as defined by SEC rules and does not require a restatement of the Funds’ financial statements. The Registrants’ conclusion is based on the fact that the Funds have procedures to check for expenses exceeding five percent of total expenses. These procedures were executed on an early draft of the financial statements and a failure to repeat such procedures after adjustments were made to the draft financial statements led to the incorrect disclosures. The Registrants confirm that overall expenses were appropriately disclosed for each Fund, as well as Fund expense ratios presented in the financial highlights. The Registrants also confirm that net assets, net asset values per share and total returns for each fund were appropriately disclosed. The Registrants believe this error to be an isolated incident and have updated their written procedures to include performing additional tolerance tests if any financial statement adjustments are made that affect the Miscellaneous Expense line item.
8. Comment: Loan Fees Received – Loomis Sayles Senior Floating Rate and Fixed Income Fund. Confirm whether the Loomis Sayles Senior Floating Rate and Fixed Income Fund received any consent fees, amendment fees and/or upfront origination fees. If significant, disclose such amounts as a separate line item in the Statement of Operations and include a corresponding note in the Notes to Financial Statements regarding the accounting policy for recognizing such income.
Response: The Registrant confirms that any consent fees, amendment fees and/or upfront origination fees received by the Loomis Sayles Senior Floating Rate and Fixed Income Fund during the fiscal year ended November 30, 2020 were immaterial and would not require disclosure as a separate line item i
Show Raw Text
CORRESP 1 filename1.htm Natixis Funds Trust II August 20, 2021 U.S. Securities and Exchange Commission Division of Investment Management 100 F Street, NE Washington, DC 20549-0504 Attention: Christina Fettig VIA EDGAR Re: Registrants: Natixis Funds Trust I (9/30/20 and 12/31/20), Natixis Funds Trust II (11/30/20 and 12/31/20), Natixis ETF Trust (12/31/20), Natixis ETF Trust II (12/31/20), Gateway Trust (12/31/20), Loomis Sayles Funds I (09/30/20 and 12/31/20) and Loomis Sayles Funds II (09/30/20 and 12/31/20) File Nos.: Natixis Funds Trust I: 811-04323 Natixis Funds Trust II: 811-00242 Natixis ETF Trust: 811-23146 Natixis ETF Trust II: 811-23500 Gateway Trust: 811-22099 Loomis Sayles Funds I: 811-08282 Loomis Sayles Funds II: 811-06241 Dear Ms. Fettig, This letter responds to your comments received by telephone on July 2, 2021 (and corresponding follow-up comments received by telephone on August 2, 2021) regarding certain filings by the above-referenced registrants (each, a “Registrant”) on behalf of certain of their series funds (each, a “Fund”). For your convenience, we have summarized each comment below, followed by the Registrants’ responses. Any term that is used, but not defined, in this letter retains the same meaning as used by the Registrants in their respective filings. 1. Comment: Benchmark Indices – Loomis Sayles Strategic Alpha Fund and AlphaSimplex Global Alternatives Fund. Please explain how the benchmark indices were determined to be broadbased securities indices for the aforementioned funds. Specifically, for Loomis Sayles Strategic Alpha Fund, explain the use of 3-month LIBOR and 3-month LIBOR +300 basis points as broad based indices and, for AlphaSimplex Global Alternatives Fund, explain the use of Barclay Fund of Funds Index when the AlphaSimplex Global Alternatives Fund is not a fund of funds. Response: The Registrants seek to align each Fund’s investment objective, strategy and underlying asset classes with an appropriate benchmark relative to those factors. For some funds this is a relatively straightforward process, but for others this is more complicated, particularly for funds like the AlphaSimplex Global Alternatives Fund and the Loomis Sayles Strategic Alpha Fund which have more differentiated investment strategies, as described more fully below. AlphaSimplex Global Alternatives Fund – as disclosed in the Fund’s prospectus, “the Fund pursues an absolute return strategy that seeks to provide capital appreciation consistent with the risk-return characteristics of a diversified portfolio of hedge funds. The secondary goal of the Fund is 1 to achieve these returns with less volatility than major equity indices.” The Barclay Fund of Funds Index is a measure of the average net return of all hedge fund of funds in the Barclay database. The Registrant believes this benchmark is an appropriate comparison for the Fund because hedge fund of funds are intended to be diversified portfolios of hedge funds. This is consistent with the Fund’s investment goals of providing capital appreciation “consistent with the risk-return characteristics of a diversified portfolio of hedge funds.” Loomis Sayles Strategic Alpha Fund – as disclosed in the Fund’s prospectus, “the Fund seeks to provide an attractive absolute total return, complemented by prudent investment management designed to manage risk and protect investor capital. The secondary goal of the Fund is to achieve these returns with relatively low volatility.” The Fund has two comparative benchmarks, 3-Month LIBOR and 3-Month LIBOR +300 basis points. (As you may know, LIBOR is generally representative of short-term interest rates.) The Registrant believes that both comparative benchmarks are appropriate. The selection of 3-Month LIBOR is consistent with the Fund’s absolute total return investment objective. The Fund’s prospectus describes this objective as follows: “The Fund has an absolute total return investment objective, which means that it is not managed relative to an index and that it attempts to achieve positive total returns over a full market cycle.” Many products with an absolute total return investment objective have LIBOR as a comparative index because they are not being managed relative to an index and because LIBOR, as a measure of short-term rates, is expected to be positive over time, consistent with the Fund’s investment objective. The Fund also shows performance relative to 3-Month LIBOR +300 basis points. The Registrant believes this benchmark is appropriate because it is consistent with the Fund’s investment objective and with the anticipated risk and return targets of the Fund as specified by its portfolio managers. Follow-up Comment: In reference to the above response, the Staff notes that the 3-month LIBOR and the 3-month LIBOR +300 basis points benchmarks are not securities market indices and reiterate its comment to include a broad based index for the Loomis Sayles Strategic Alpha Fund. Follow-up Response: The Registrant respectfully submits that the 3-month LIBOR and the 3-month LIBOR +300 basis points are appropriate measures against which to compare the Fund’s performance. LIBOR is a benchmark interest rate index, which represents the average rate a leading bank, for a given currency, can obtain unsecured funding, and is representative of short-term interest rates. Item 27(b)(7), Instruction 5 of Form N-1A defines an appropriate index as “one that is administered by an organization that is not an affiliated person of the Fund, its investment adviser, or principal underwriter, unless the index is widely recognized and used.” The Registrant believes that the 3-month LIBOR and the 3-month LIBOR +300 basis points appropriately meet this definition and notes that several other funds use similar LIBOR benchmarks as the broad-based indexes against which they measure their performance. However, although the Registrant believes that its current indices are appropriate, it recognizes that the pending discontinuation of LIBOR will require a change to its benchmark indices, and it will incorporate the Staff’s comments in selecting a new index when a reliable LIBOR benchmark is no longer available. 2 2. Comment: Top Ten Holdings – Loomis Sayles Global Allocation Fund (and any other fund that discloses a Top Ten Holdings table). Consider adding clarifying disclosure to the Top Ten Holdings table to specify that the securities listed are presented on an individual security basis and do not represent holdings of the issuer. Response: In future filings, the Registrants will include clarifying disclosure to the Top Ten Holdings table to specify that the securities listed are presented on an individual security basis and do not represent holdings of the issuer. 3. Comment: Top Ten Holdings – Vaughan Nelson Mid Cap Fund and Vaughan Nelson Small Cap Value Fund. Verify the accuracy of the Funds’ Top Ten Holdings tables as compared to each applicable Portfolio of Investments. Response: Due to human error, the wrong Top Ten Holdings tables were included in the December 31, 2020 annual report for Vaughan Nelson Mid Cap Fund and Vaughan Nelson Small Cap Value Fund. As this error indicates a potential deficiency in the Funds’ internal controls over financial reporting, the Registrants have assessed such control deficiency to determine if it constitutes a significant deficiency or material weakness and whether restatement of the Funds’ financial statements is required. The Registrants have concluded that this control deficiency is not a significant deficiency or material weakness as defined by Securities and Exchange Commission (“SEC”) rules and does not require a restatement of the Funds’ financial statements. The Registrants’ conclusion is based on the fact that the Funds have procedures to review and verify Top Ten Holdings tables and it was a failure to follow such procedures that resulted in the wrong Top Ten Holdings tables being included in the Funds’ financial statements. Additionally, the Registrants confirm that, at the time of the mailing of the applicable financial statements, the correct Top Ten Holdings tables had been available to shareholders on the Funds’ website, Fact Sheets and other marketing materials. The Registrants believe this error to be an isolated incident and have added clarification to existing written procedures regarding the reconciliation of Top Ten Holdings tables to Portfolios of Investments. Additionally, the Registrants have reinforced with the appropriate personnel the proper procedure to review and verify Top Ten Holdings information included in the Registrants’ annual reports. Follow-up Comment: In reference to the above response, have the Registrants considered amending the Form N-CSR filings to correct the Top Ten Holdings disclosures for Vaughan Nelson Mid Cap Fund and Vaughan Nelson Small Cap Value Fund as of the year ended December 31, 2020? Follow-up Response: Based on an evaluation by the Funds’ investment adviser, Natixis Advisors, LLC, of the impact of inclusion of the wrong Top Ten Holdings tables in the December 31, 2020 annual report for Vaughan Nelson Mid Cap Fund and Vaughan Nelson Small Cap Value Fund, the Registrants determined that the errors were not material to the Funds’ December 31, 2020 financial statements, taken as a whole, for the reasons stated above. Accordingly, the Registrants have concluded that the errors did not require the filing of an amended Form N-CSR. 3 4. Comment: Diversification – Loomis Sayles Growth Fund. Confirm that Loomis Sayles Growth Fund meets the diversification requirements as set forth in Section 5(b)(1) of the Investment Company Act of 1940, as amended (the “1940 Act”). Response: The Registrant, on behalf of the Fund, confirms that the Fund was in compliance with the requirements set forth in Section 5(b)(1) of the 1940 Act as of September 30, 2020 and all prior fiscal quarter ends and continues to remain in compliance with those requirements. The Registrant notes that Section 5(c) of the 1940 Act states that “a registered diversified company which at the time of its qualification as such meets the requirements of paragraph (1) of subsection (b) shall not lose its status as a diversified company because of any subsequent discrepancy between the value of its various investments and the requirements of said paragraph, so long as any such discrepancy existing immediately after its acquisition of any security or other property is neither wholly nor partly the result of such acquisition.” 5. Comment: Non-Diversified Investment Company Status – Loomis Sayles Senior Floating Rate and Fixed Income Fund, Loomis Sayles Strategic Alpha Fund, and Mirova Global Green Bond Fund. Each of the above-referenced Funds are disclosed as being non-diversified investment companies in their respective prospectuses and financial statements. Based on our review of each Fund’s Portfolio of Investments, the aforementioned Funds appear to be diversified investment companies. Confirm that if a non-diversified registered fund continues to operate as diversified investment company for more than 3 years, then the Fund will obtain shareholder approval before being reclassified as a non-diversified investment company. Verify the non-diversified investment company status of each of the above-referenced Funds. Response: The Registrants acknowledge that the above-referenced Funds have operated as diversified investment companies for more than 3 years, continue to operate as diversified investment companies as of the date of this letter, and expect to operate as diversified investment companies going forward. The Registrants will amend each Fund’s prospectus disclosure regarding diversification status during the next annual registration statement update on April 1, 2022 for the Loomis Sayles Senior Floating Rate and Fixed Income Fund and on May 1, 2022 for the Loomis Sayles Strategic Alpha Fund and Mirova Global Green Bond Fund. Until such time as the Funds’ registration statements are amended, the Registrants confirm that each Fund will reflect in its financial statements and other filings the Fund’s status as a diversified investment company. 6. Comment: Concentration of Risk – AlphaSimplex Global Alternatives Fund. Going forward, AlphaSimplex Global Alternatives Fund should evaluate including any additional tabular representations of fund holdings representing other significant types of concentrations of risk in its Portfolio of Investments. If so, include associated additional risk disclosure in the Notes to Financial Statements. Please refer to ASC 825-10-50 for relevant disclosure requirements. 4 Response: In future filings, the Registrant will evaluate the appropriateness of including additional tabular representations of fund holdings representing other significant concentrations of risk in its Portfolio of Investments, along with corresponding risk disclosure in the Notes to Financial Statements. 7. Comment: Significant Other Expenses – Natixis Loomis Sayles Short Duration Income ETF, Natixis U.S. Equity Opportunities ETF, Natixis Vaughan Nelson Mid Cap ETF, and Natixis Vaughan Nelson Select ETF. For the above-referenced Funds, verify whether all significant other expenses (any expense item which exceeds five percent of the total expenses) have been appropriately disclosed as separate line items on the Statements of Operations as required per Rule 6-07 (2)(b) of Regulation S-X. Response: Due to human error, fees associated with Form N-PORT preparation, which exceeded five percent of total expenses for Natixis Vaughan Nelson Mid Cap ETF and Natixis Vaughan Nelson Select ETF, were not disclosed as a separate line item on the Statements of Operations. As this error indicates a potential deficiency in the Funds’ internal controls over financial reporting, the Registrants have assessed such control deficiency to determine if it constitutes a significant deficiency or material weakness and whether restatement of the Funds’ financial statements is required. The Registrants have concluded that this control deficiency is not a significant deficiency or material weakness as defined by SEC rules and does not require a restatement of the Funds’ financial statements. The Registrants’ conclusion is based on the fact that the Funds have procedures to check for expenses exceeding five percent of total expenses. These procedures were executed on an early draft of the financial statements and a failure to repeat such procedures after adjustments were made to the draft financial statements led to the incorrect disclosures. The Registrants confirm that overall expenses were appropriately disclosed for each Fund, as well as Fund expense ratios presented in the financial highlights. The Registrants also confirm that net assets, net asset values per share and total returns for each fund were appropriately disclosed. The Registrants believe this error to be an isolated incident and have updated their written procedures to include performing additional tolerance tests if any financial statement adjustments are made that affect the Miscellaneous Expense line item. 8. Comment: Loan Fees Received – Loomis Sayles Senior Floating Rate and Fixed Income Fund. Confirm whether the Loomis Sayles Senior Floating Rate and Fixed Income Fund received any consent fees, amendment fees and/or upfront origination fees. If significant, disclose such amounts as a separate line item in the Statement of Operations and include a corresponding note in the Notes to Financial Statements regarding the accounting policy for recognizing such income. Response: The Registrant confirms that any consent fees, amendment fees and/or upfront origination fees received by the Loomis Sayles Senior Floating Rate and Fixed Income Fund during the fiscal year ended November 30, 2020 were immaterial and would not require disclosure as a separate line item i