Barings Corporate Investors : Quarter Ended March 2021 – Barings Corporate Investors

Barings Corporate Investors

Report for the Three Months Ended March 31, 2021

Adviser	Transfer Agent & Registrar
Barings LLC	DST Systems, Inc.
300 S Tryon St., Suite 2500	P.O. Box 219086
Charlotte, NC 28202	Kansas City, Missouri 64121-9086
	1-800-647-7374
Independent Registered Public Accounting Firm
KPMG LLP	Internet Website
Boston, Massachusetts 02110	www.barings.com/mci
Counsel to the Trust	Barings Corporate Investors
c/o Barings LLC
Ropes & Gray LLP
300 S Tryon St., Suite 2500
Boston, Massachusetts 02111
Charlotte, NC 28202
Custodian	1-866-399-1516
State Street Bank and Trust Company
Boston, Massachusetts 02110

Investment Objective and Policy

Barings Corporate Investors (the "Trust") is a closed-end management investment company, first offered to the public in 1971, whose shares are traded on the New York Stock Exchange under the trading symbol "MCI". The Trust's share price can be found in the financial section of most newspapers under either the New York Stock Exchange listings or Closed-End Fund Listings.

The Trust's investment objective is to maintain a portfolio of securities providing a current yield and, when available, an opportunity for capital gains. The Trust's principal investments are privately placed, below-investment grade, long-term debt obligations including bank loans and mezzanine debt instruments. Such private placement securities may, in some cases, be accompanied by equity features such as common stock, preferred stock, warrants, conversion rights, or other equity features. The Trust typically purchases these investments, which are not publicly tradable, directly from their issuers in private placement transactions. These investments are typically made to small or middle market companies. In addition, the Trust may invest, subject to certain limitations, in marketable debt securities (including high yield and/or investment grade securities) and marketable common stocks. Below-investment grade or high yield securities have predominantly speculative characteristics with respect to the capacity of the issuer to pay interest and repay principal.

The Trust distributes substantially all of its net income to shareholders each year. Accordingly, the Trust pays dividends to shareholders in January, May, August, and November. The Trust pays dividends to its shareholders in cash, unless the shareholder elects to participate in the Dividend Reinvestment and Share Purchase Plan.

Form N-PORT

The Trust files its complete schedule of portfolio holdings with the U.S. Securities and Exchange Commission ("SEC") for the first and third quarters of each fiscal year on part F of Form N-PORT. This information is available (i) on the SEC's website at http://www.sec.gov; and (ii) at the SEC's Public Reference Room in Washington, DC (which information on their operation may be obtained by calling 1-800-SEC-0330).

A complete schedule of portfolio holdings as of each quarter-end is available upon request by calling, toll-free,866-399-1516.

Proxy Voting Policies & Procedures; Proxy Voting Record

The Trustees of the Trust have delegated proxy voting responsibilities relating to the voting of securities held by the Trust to Barings LLC ("Barings"). A description of Barings' proxy voting policies and procedures is available (1) without charge, upon request, by calling, toll-free866-399-1516; (2) on the Trust's website at www.barings.com/mci; and (3) on the SEC's website at http://www.sec.gov. Information regarding how the Trust voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available

1. on the Trust's website at www.barings.com/mci; and (2) on the SEC's website at http://www.sec.gov.

Legal Matters

The Trust has entered into contractual arrangements with an investment adviser, transfer agent and custodian (collectively "service providers") who each provide services to the Trust. Shareholders are not parties to, or intended beneficiaries of, these contractual arrangements, and these contractual arrangements are not intended to create any shareholder right to enforce them against the service providers or to seek any remedy under them against the service providers, either directly or on behalf of the Trust.

Under the Trust's Bylaws, any claims asserted against or on behalf of the Trust, including claims against Trustees and officers must be brought in courts located within the Commonwealth of Massachusetts.

The Trust's registration statement and this shareholder report are not contracts between the Trust and its shareholders and do not give rise to any contractual rights or obligations or any shareholder rights other than any rights conferred explicitly by federal or state securities laws that may not be waived.

Barings Corporate Investors

TO OUR SHAREHOLDERS

April 30, 2021

We are pleased to present the March 31, 2021 Quarterly Report of Barings Corporate Investors (the "Trust").

PORTFOLIO PERFORMANCE

The Board of Trustees declared a quarterly dividend of $0.24 per share, payable on May 14, 2021 to shareholders of record on May 3, 2021. The Trust paid a $0.24 per share dividend for the preceding quarter. The Trust earned $0.21 per share of net investment income for the first quarter of 2021, compared to $0.47 per share in the previous quarter.

During the first quarter, the net assets of the Trust increased to $317,805,145 or $15.69 per share compared to $304,684,324 or $15.04 per share on December 31, 2020. This translates to a 4.3% total return for the quarter, based on the change in the Trust's net assets assuming the reinvestment of all dividends. Longer term, the Trust returned 16.4%, 8.8%, 10.0%, 11.0%, and 12.2% for the 1, 3, 5, 10, and 25-year periods, respectively, based on the change in the Trust's net assets assuming the reinvestment of all dividends.

The Trust's market price increased 5.7% during the quarter, from $13.18 per share as of December 31, 2020 to $13.93 per share as of March 31, 2021. The Trust's market price of $13.93 per share equates to an 11.2% discount to the March 31, 2021 net asset value per share of $15.69. The Trust's average quarter-end discount/premium for the 3, 5 and 10-year periods was -3.0%, 0.8% and 8.2%, respectively. U.S. fixed income markets, as approximated by the Bloomberg Barclays U.S. Corporate High Yield Index and the Credit Suisse Leverage Loan Index, increased 0.9% and 2.0% for the quarter, respectively.

PORTFOLIO ACTIVITY

The Trust closed seven new private placement investments and 10 add-on investments to existing portfolio companies during the first quarter. The total amount invested by the Trust in these transactions was $20,316,612. Of note, the new platform investments were floating rate term loans, two of which included equity co-investments, and the add-on investments were eight floating rate term loans and two small equity co-investments.

Improving market conditions and robust investment activity during the fourth quarter of 2020 continued into the first quarter of 2021. As the investment landscape has improved, some key trends have emerged. First, investment activity is now back to (and even beyond) pre-pandemic levels. Momentum continues to build in the private mid-market and appears unaffected by the seasonality we sometimes see this time of year. Secondly, in the current market, financial sponsors and other ownership groups are motivated to divest portfolio companies due to the high valuations for strong businesses. With the significant dry powder they have available, financial sponsors are also motivated to acquire high- quality businesses which have outperformed through both good times and the more recent uncertainty. Lastly, private equity clients continue to work with a smaller group of trusted lenders with whom they have long-standing relationships and who can offer certainty of execution and creative solutions. These trends assisted Barings in being the second most active institutional lender across the U.S. private middle-market in 2020.

We continue to be selective in our investment choices and maintain our underwriting discipline throughout multiple cycles. First, the Trust continues to invest in first lien senior secured loans in high-quality companies in defensive sectors and is well diversified by industry. This was a strategy put in place about four years ago and has provided strong risk adjusted returns for the Trust given their senior position in the capital stack. As of March 31, 2021, 54.0% of the Trust's investment portfolio is in first lien senior secured loans compared to 2.6% as of December 31, 2017. These investments have proven resilient to date and their management teams now have the benefit of having a wealth of knowledge to draw upon from working in such unique and challenging circumstances. Second, we hold meaningful investment liquidity based on the Trust's combined available cash balance and short-term investments of $26,311,078 or 7.6%, and low leverage profile at 0.09x as of March 31, 2021. Strong liquidity also provides ample support to our current portfolio companies to the extent the duration of COVID-19 related stress extends. Third, we continue to be selective in pruning our equity investments and reinvesting the proceeds into first lien senior secured investments further driving investment income. As always, the Trust continues to benefit from strong relationships with our financial sponsor partners which provides clear benefits including potential access to additional capital if needed, strategic thinking alongside their management teams and high-quality and timely information which is only available in a private market setting. This allows us to work constructively together and maximize the portfolio companies' long-term health and value.

(Continued)

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In closing, we believe it is always appropriate to provide views on the Trust's long-term dividend policy which is to say, 'we believe that long-term dividends should be a reflection of long-term core earnings power, even when core earnings power is lower as a result of a higher quality asset mix'. The Trust's recently announced dividend of $0.24 per share sits slightly above our most recently reported net investment income of $0.21 per share. That said, as we continue to both

1. deploy the Trust's excess liquidity and (2) seek opportunities to shift the Trust's non-yielding equity investments to senior secured loans, we expect long-term earnings power to meet the dividend distribution.

Thank you for your continued interest in and support of Barings Corporate Investors.

Sincerely,

Christina Emery

President

		Portfolio Composition as of 03/31/21*
Public Debt	Public Equity
1.4%		0.5%
Public Bank Loans		Cash & Short-Term
2.9%
Cash & Short-Term		Investments
7.6%
Investments
7.6%
			Equity
Private / Restricted	10.6%
Equity
10.1%
			Fixed Rate
Private Debt	20.0%
16.8%
		Private Bank Loans	Floating Rate
		60.7%
					61.9%

* Based on market value of total investments (including cash)

Cautionary Notice: Certain statements contained in this report may be "forward looking" statements. Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they are made and which reflect management's current estimates, projections, expectations or beliefs, and which are subject to risks and uncertainties that may cause actual results to differ materially. These statements are subject to change at any time based upon economic, market or other conditions and may not be relied upon as investment advice or an indication of the Trust's trading intent. References to specific securities are not recommendations of such securities, and may not be representative of the Trust's current or future investments. We undertake no obligation to publicly update forward looking statements, whether as a result of new information, future events, or otherwise.

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Barings Corporate Investors

CONSOLIDATED STATEMENT OF ASSETS AND LIABILITIES

March 31, 2021 (Unaudited)

Assets:

Investments

(See Consolidated Schedule of Investments)
Corporate restricted securities - private placement investments at fair value
(Cost - $ 278,416,786)	$	277,232,222
Corporate restricted securities - rule 144A securities at fair value
(Cost - $ 24,022,852)		25,440,308
Corporate public securities at fair value
(Cost - $ 15,989,790)		16,357,558
Short-term securities at fair value
(Cost - $ 5,997,382)		5,997,382
Total investments (Cost - $ 324,426,810)		325,027,470
Cash		20,313,696
Interest receivable		2,545,755
Receivable for investments sold		186,851
Other assets		1,665,122
Total assets		349,738,894
Liabilities:
Note payable		30,000,000
Payable for investments purchased		712,000
Investment advisory fee payable		993,141
Interest payable		135,317
Accrued expenses		93,291
Total liabilities		31,933,749
Commitments and Contingencies (See Note 7)
Total net assets	$	317,805,145
Net Assets:
Common shares, par value $1.00 per share	$	20,261,719
Additional paid-in capital		272,501,030
Total distributable earnings		25,042,396
Total net assets	$	317,805,145
Common shares issued and outstanding (28,054,782 authorized)		20,261,719
Net asset value per share	$	15.69

See Notes to Consolidated Financial Statements

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