SEC Comment Letter 0000000000-25-005432 to American Funds Core Plus Bond Fund (CIK 0002064871)
American Funds Core Plus Bond Fund (CIK 0002064871)
Date: May 21, 2025 · CIK: 0002064871 · Accession: 0000000000-25-005432
AI Filing Summary & Sentiment
File numbers found in text: 333-286599, 811-24077
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VIA E-MAIL May 1 2025 Charlene H. Kim, Esq. Senior Counsel, Legal and Compliance Group Capital Research and Management Company333 South Hope Street Los Angeles, CA 90071-1406 Re: American Funds Core Plus Bond Fund File Nos. 333-286599; 811-24077 Dear Ms. Kim; On April 17, 2025, you filed the above -referenced registration stat ement on Form N-1A with respect to American Funds Core Plus Bond Fund (the “Fund”). We have reviewed the registration statement and our comments are set forth below. Where a comment is made with respect to disclosure in one location of the filing, it applie s to all similar disclo sures found elsewhere. Capitalized terms not otherwise defined have the same mean ing as in the registration statement. GENERAL 1. We note that portions of the re gistration statement are incomplete. A full financial review ( e.g., seed financial statements, auditor's report, consent) must be performed prior to declaring the registration statement effective. We may have additional comm ents on such portions when you complete them in a pre-effective amendment, on disclosures made in response to this letter, on information supplied supplementally, or on exhibits added in any amendment. 2. Please confirm the Fund will file a fidelity bond under Form 40-17G. 3. Please provide the name of the Fund’s inde pendent registered pub lic accounting firm in correspondence. 4. Please update the Fund’s series and class identifi ers to reflect the ticker symbols for each class. Ms. Charlene H. Kim May , 2025 Page 2 PROSPECTUS Fees and Expenses, page 1 5. The fee table provides a line ite m for Other Expenses. Since the Fund is a new fund, please add a footnote to the Other Expenses line item stating that the figures ar e based on estimated amounts for the current year. See Item 3, Instruction (“In str.”) 6 of Form N-1A. Principal Investment Strategies, page 3 6. The first sentence of the first paragraph states th at, “the fund will normally i nvest at least 80% of its assets in bonds and other de bt securities, which may be represented by derivatives.” Please revise to clarify that the F und will invest 80% of its net assets , plus the amount of any borrowings for investment purposes ... 7. The disclosure states that, “The fund may invest in a broad range of debt securities, including … debt and mortgage- and other asse t-backed securities issued by U.S. government-sponsored entities … and instrumentalities that are not backed by th e full faith and credit of the U.S. government.” Please clarify in the disclosure if the Fund’s investments in mortga ge-backed securities include sub- prime mortgages, please disclose the principa l risks associated with sub-prime mortgages. 8. The first sentence of the second paragraph states that, the “fund may inve st in forward currency contracts. . .” Please revise disclosure to clarif y if the forward currency contracts are directional and/or intended for purposes of hedging curr ency risk for non-U.S. dollar denominated debt securities. 9. The fourth paragraph in this section discloses th at the Fund may invest “up to 25% of its assets in securities of emerging market issuers.” Please: (a ) define “emerging market ” in the disclosure, and (b) disclose how the Fund determines that an issuer is an “emerging markets issuer.” Principal Risks, pages 4-8 10. Please consider adding a risk fact or discussing the principal risks as sociated with investing in a new fund ( e.g., the fund may have higher expe nses, may not grow to an economically viable size, and may cease operations and investors may be required to liquidate or transfer their investments at a loss). Tax Information, page 9 11. Under this heading, the di sclosure states, “Divide nds and capital gain dist ributions you receive from the fund are subject to federal inco me taxes and may also be subject to state and local taxes, unless you are tax-exempt or your account is tax-favored.” At the end of this sentence, please add, “in which case you may be subject to taxes upon withdr awal from such account” or similar language. Ms. Charlene H. Kim May 1 , 2025 Page 3 Investment Objective, Strategies and Risks, pages 10-18 12. The second paragraph in this sect ion discloses that, “The fund may i nvest in debt securities of any maturity or duration.” Please also in clude this disclosure in Item 4. 13. The last sentence of the second paragraph stat es, “The longer a secur ity’s duration, the more sensitive it will be to changes in interest rates.” Please provide an example of duration here ( e.g., the price of a security with a durati on of five years would be expect ed to fall approximately 5% if interest rates rose by one percentage point). 14. The Fund includes a risk factor titled, “Exposure to country, region, industry or sector.” If the Fund may have significant exposure to a particular country, region, i ndustry or sector, please include related disclosure in the principa l investment strategies section. 15. The Fund includes a risk factor titled, “Large shareholder con centration,” with references to “Authorized Participant” in the paragraph. Please delete refere nces to “Authorized Participant,” or explain to staff how this the te rm is applicable to the Fund. STATEMENT OF ADDITIONAL INFORMATION (“SAI”) Certain Investment Limitati ons and Guidelines, page 2 16. Under the heading, “Debt instruments,” the SAI stat es that, “The fund will invest at least 80% of its assets in bonds and other debt instruments, including Eurodo llar and Yankee bonds, debentures, notes, securities with equity and fixed income charact eristics (such as bonds with warrants attached, convertible bonds, certain hybrids and certain pref erred securities), cash and cash equivalents, securities backed by mortgages and other assets, lo ans, and other fixed income obligations of banks, corporations and governmental auth orities.” Please reconcile the disclosure with the language in both Items 4 and 9. 17. Under the same heading, the sec ond bullet point discusses the Fund’s investments in securities rated Ba1 or below and BB+ or below by NRSROs. Please add that such securities are sometimes referred to as “junk bonds.” 18. Under the heading, “Equity securiti es,” the SAI states th e fund may invest up to 10% of its assets in equity securities (including comm on stocks, preferred stocks, warrant s or rights). Please include this disclosure in the prospectus as well as corresponding risks. Fund Policies, pages 33-34 19. Regarding the Fund’s concentration policies, plea se note that a fund and it s adviser may not ignore the investments of affiliated and unaffiliated underlying investme nt companies when determining whether the fund is in co mpliance with its concentration polici es. Please confirm that the Fund will Ms. Charlene H. Kim May 1 , 2025 Page 4 consider the investments of its underlying investment companie s when determining the Fund’s compliance with its concentration policies. 20. The last paragraph on page 34 states, “This policy does not apply to investme nts in securities of the U.S. government, its agencies or government sponsored enterprises or repurchase agreements with respect thereto.” For clarity, please add “U .S.” in front of “government sponsored.” Management of the Fund, pages 35-53 21. It appears that disclo sures in certain sections use the word “trustees” interchangeably with “directors,” without making it clea r that they have the same mean ing. To avoid confusion, please consider clarifying that they have the sa me meaning, or use one consistent term. 22. On page 40, under the heading, “Fund organization a nd the board of trustees,” please disclose that the registrant has no prior history since th e registrant is a newly organized company. See Item 15 of Form N-1A. Financial Statements, Exhibi ts, and Other Information 23. Any financial statements, exhibits, and other requir ed disclosure not included in these registration statements must be filed in a pre-effective amendment to the registration statement. 24. Please include all exhibits that are marked “to be provided by amendment.” Signatures 25. Pursuant to Section 6(a) of th e Securities Act of 1933, the registration statement must be signed by the issuer, the principal executive officer(s), the principal financial officer, the comptroller or principal accounting officer, as well as a majority of the director s or persons performing similar functions. Please ensure that, in addition to the trus tees’ signatures, all futu re amendments are signed by the Fund’s principal executive of ficer, the comptroller or princi pal accounting officer, or the principal financial officer, as required by Section 6(a). ***** Responses to this letter should be made in a letter to me filed on EDGAR and in the form of pre- effective amendments filed pursuant to rule 472 under the Securities Act. Where no change will be made in a filing in response to a comment, please indicate this fact in the letter to us and briefly state the basis for your position. Please advise us if you have submitted or expect to submit any exemptive applications or no-action requests in connection with your registration stat ement. The staff may have additional comments. We remind you that the Fund is respons ible for the accuracy and adequa cy of its disclosure in the registration statements, notwithstan ding any review, comments, action, or absence of acti on by the staff. Ms. Charlene H. Kim May 1 , 2025 Page 5 Should you have any questions, plea se contact me at (202) 880-1783, imtangso@sec.gov , or Mindy Rotter, Staff Accountant, at (212) 336-1096, RotterM@sec.gov. Sincerely, /s/ Soo Im-Tang Soo Im-Tang Attorney-Adviser cc: Mindy Rotter, Staff Accountant John Lee, Senior Special Counsel Michael J. Spratt, Assistant Director