SEC Form N-CSR filed by Voya Prime Rate Trust

Voya Investment Management

Annual Report

February 28, 2021

Voya Prime Rate Trust

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INVESTMENT MANAGEMENT

voyainvestments.com

Voya Prime Rate Trust

ANNUAL REPORT

February 28, 2021

Table of Contents

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Voya Prime Rate Trust

PORTFOLIO MANAGERS' REPORT

Dear Shareholders:

Voya Prime Rate Trust* (the "Trust") is a diversified, closed-end management investment company that seeks to provide investors with as high a level of current income as is consistent with the preservation of capital. The Trust seeks to achieve this objective by investing, under normal market conditions, at least 80% of its net assets, plus borrowings for investment purposes, in U.S. dollar-denominated floating rate secured senior loans.

PERFORMANCE SUMMARY

The Trust declared $0.04 of dividends during the fourth fiscal quarter and $0.18 during the year ended February 28, 2021. Based on the average month-end net asset value ("NAV") per share of $4.91 for the fourth fiscal quarter and $4.75 for the year, the annualized distribution rate⁽¹⁾ was 3.26% for the fourth fiscal quarter and 3.89% for the year. The Trust's total return for the fourth fiscal quarter, based on NAV⁽⁴⁾, was 3.17%⁽²⁾ versus a total gross return on the S&P/LSTA Leveraged Loan Index (the "Index")⁽³⁾ of 3.15% for the same quarter. For the year ended February 28, 2021, the Trust's total return, based on NAV⁽⁴⁾, was -2.14%⁽²⁾, versus a total return on the Index of 5.78%. The total market value return⁽⁵⁾ for the Trust's Common Shares during the fourth fiscal quarter was 4.49% and for the year ended February 28, 2021 was -1.59%.

⁽¹⁾  The distribution rate is calculated by annualizing dividends and distributions declared during the period using the 30/360 convention and dividing the resulting annualized dividend by the Trust's average net asset value (in the case of NAV) or the average month-end NYSE Composite closing price (in the case of market). The distribution rate is based solely on the actual dividends and distributions, which are made at the discretion of management. The distribution rate includes distributions from net investment income and return of capital, but does not include capital gains or losses.

⁽²⁾  Total returns shown include, if applicable, the effect of fee waivers and/or expense reimbursements by Voya Investments, LLC. Had all fees and expenses been considered, the total returns would have been lower.

⁽³⁾  The Index is an unmanaged total return index that captures accrued interest, repayments, and market value changes. It represents a broad cross section of leveraged loans syndicated in the United States, including dollar-denominated loans to overseas issuers. Standard & Poor's ("S&P") and the Loan Syndications and Trading Association ("LSTA") conceived the Index to establish a performance benchmark for the syndicated leveraged loan industry. The Index is not subject to any fees or expenses. An investor cannot invest directly in an index.

⁽⁴⁾  Total investment return at NAV has been calculated assuming a purchase at NAV at the beginning of each period and a sale at NAV at the end of each period and assumes reinvestment of dividends, capital gain distributions, and return of capital distributions/allocations, if any, in accordance with the provisions of the Trust's dividend reinvestment plan.

⁽⁵⁾  Total investment return at market value measures the change in the market value of your investment assuming reinvestment of dividends, capital gain distributions, and return of capital distributions/allocations, if any, in accordance with the provisions of the Trust's dividend reinvestment plan.

Voya Prime Rate Trust

PORTFOLIO MANAGERS' REPORT (continued)

Market Review: The Trust's fiscal period started in unprecedented fashion, as the loan market experienced its second worst performing month on record in March 2020 (-12.37%). During this timeframe, the lockdown response to the COVID-19 pandemic, together with a price war in the energy commodity markets, created a rapidly moving contagion across broad markets, leading to outsized losses in virtually all major risk asset classes, loans included. From April onwards, investor sentiment was buoyed initially by robust fiscal and monetary support, and subsequently, by positive news on vaccine development, regional business re-openings and expectations of a broad-based related economic recovery into 2021. Altogether, the Index returned 5.78% during the Trust's fiscal year, which, based on over twenty years of historical market returns, presents an air of normality, in our view. When diving into the details of the performance period journey, it becomes clear that it was anything but. For context, the average bid price of the Index ended the fiscal year at 97.78, 260 basis points (2.60%) higher than the period ended February 29, 2020, but more than 20 points higher from the low-water mark of 76.26 experienced on March 23, 2020 at the apex of the widespread uncertainty.

The loan market's technical equation came under pressure during the market drawdown and early phase of the subsequent recovery but recovered in the back-half of the fiscal year. Starting with supply, new-issue activity ramped up in September and maintained a busy pace through the end of the period, averaging roughly $39 billion of new institutional issuance per month. In total, loan arrangers syndicated $311 billion of new paper for the fiscal period, a respectable amount, in our view, considering that the COVID-19-induced volatility experienced in the early part of the period virtually cratered primary market activity. On the demand side, investor interest in the asset class improved in line with the recovery in both the macro and loan market backdrop. Collateralized loan obligation ("CLO") origination picked up in late summer in tandem with stronger supply volumes, as well as tighter liability spreads that were underpinned by the improvement in secondary prices and diminishing fears over repeated waves of credit ratings downgrades. Total CLO issuance amounted to slightly under $100 billion during the period. Meanwhile, retail fund flow activity spent most of the period in negative territory, as evidenced by a $16.5 billion aggregate in redemptions during the fiscal timeframe; however, it's worth noting the last three months saw meaningful inflow activities within the retail segment of the asset class, largely a function of a rise in long-term rates and changes in inflation expectations.

While all ratings cohorts were in the black for the one-year period, lower-rated loans fared considerably better. CCC-rated loans were the standout performers with an outsized gain of 11.01%, followed by single-B- and BB-rated loans, which returned 6.16% and 2.95%, respectively. The outperformance of

TOP TEN LOAN ISSUERS
AS OF FEBRUARY 28, 2021
AS A PERCENTAGE OF:

TOP TEN INDUSTRIES
AS OF FEBRUARY 28, 2021
AS A PERCENTAGE OF:

Voya Prime Rate Trust

PORTFOLIO MANAGERS' REPORT (continued)

lower-quality, particularly CCC-rated loans, is largely related to the strong technical retracement that began to take root at the onset of the initial recovery in April. However, it's important in our view to highlight that many issuers within this cohort began the year in single-B-rated loans territory and subsequently fell into the CCC-rated loans bucket due to aggressive rating agency downgrades. In fact, a large segment of the COVID-19-related issuers fell into this category. As a result, we believe CCC-rated loans in many ways were positioned to benefit the most from any sort of strong technical tailwind that would emanate from an improving vaccine timeline.

Portfolio Specifics: On a NAV basis, the Trust underperformed the Index during the fiscal period. Underperformance was significantly magnified by leverage employed by the Trust during a period of extreme market volatility and steep price declines in the loan market, most of which occurred in March. While the Trust's use of leverage (a long-standing policy) was largely a benefit during the recovery, it was not enough to offset the losses experienced in the March market nadir. Additionally, during the Trust's third fiscal quarter (as loan prices were recovering), the Board of Trustees authorized a 15% tender offer of the Trust's outstanding common shares at 99% of NAV, and loans were sold and leverage reduced in preparation for the close of the tender offer in the Trust's fourth fiscal quarter. Further, in January, the Trust's Board of Trustees directed Voya Investments, LLC (the "adviser") to take the appropriate actions to repay the Trust's outstanding borrowings under the line of credit (the "LOC"). As of the close of business on January 15, 2021, the adviser completed selling senior loans sufficient to pay the outstanding balance of the LOC. Leverage was brought down over the course of the remaining fiscal period as the loan sales were settled, with the last of the LOC repaid in March.

On a selection basis, the primary detractors from a ratings standpoint were selection among single-B-rated loans and selection and underweight in CCC-rated loans. By industry, top laggards included selection and underweight in leisure goods/activities/movies and selection in business equipment and services and all telecommunication. Notable issuer-level detractors included an underweight in Cineworld, an overweight to Tailored Brands (formerly known as Men's Wearhouse), underweights in Hertz Corporation and Cyxtera Technologies, Inc. and overweight to Diamond Sports Group, LLC. In contrast, relative return was lifted by an underweight in defaulted credits within the Index, as well as an underweight in oil and gas and selection in nonferrous metals and minerals. Top issuer contributions included the avoidance of defaulted loans such as J.C. Penney Company Inc., Neiman Marcus Group Inc., California Resources Corporation and Fieldwood Energy LLC.

Unsurprisingly, the damage brought by the sudden disruption in economic activity had a strong impact on the ability of companies to meet their debt obligations, as default activity picked up within both the Trust and the Index. The Trust experienced eight defaults during the period, roughly 2% by average issuer count, itemized as follows: Speedcast International Limited, Longview Power LLC, SkillSoft Corporation, 24 Hour Fitness Worldwide, Inc., Covia Holdings Corporation, Tailored Brands (formerly known as Men's Wearhouse), iQor U.S. Inc. and Belk, Inc. Meanwhile, the Index had a total of 43 defaults during the period, as the historical rate of 2.9% (by principal amount) was breached for the first time since 2015. Nonetheless, default activity cooled towards the end of 2020, as the Index's trailing-12-month rate by principal amount closed out February 2021 at 3.25%, having come down from its intra-year peak of 4.17% in September.

Current Strategy and Outlook: As we look ahead, we expect investor optimism related to the vaccine rollout and related economic re-openings to buoy risk investing, but we believe valuations across equity and fixed income markets could be called into question to some degree by concerns of growing expectations of near-term inflationary pressure. Nonetheless, in our opinion, loans — which, as a reminder, are a floating rate asset class — have performed steadily amid the volatility, having been boosted by a strong technical backdrop. From a fundamental credit perspective, we believe that the continued recovery in macro conditions to bode well for individual issuers, as default pressures remain relatively muted compared to expectations in place around this time last year.

Voya Prime Rate Trust

PORTFOLIO MANAGERS' REPORT (continued)

Loan ratings apply to the underlying holdings of the Trust and not the Trust itself. Ratings distribution shows the percentage of the Trust's loan commitments (excluding cash and foreign cash) that are rated in each ratings category, based upon the categories provided by Standard & Poor. Ratings distribution is based on Standard & Poor's senior secured facility ratings. The Standard & Poor's rating scale is as follows, from excellent (high grade) to poor (including default): AAA to D, with intermediate ratings offered at each level between AA and CCC. Anything lower than a BBB- rating is considered a non-investment grade or junk bond. Any security that is not rated by Standard & Poor's is placed in the NR (Not Rated) category. Ratings can change from time to time, and current ratings may not fully reflect the actual credit condition or risks posed by a loan.

*  Not rated includes loans to non-U.S. borrowers (which are typically unrated) and loans for which the rating has been withdrawn.

*  Effective on or about June 22, 2021, Voya Investments, LLC will no longer serve as Investment Adviser and Voya Investment Management Co. LLC will no longer serve as Sub-Adviser to the Trust. Please see Note 17 for additional details.

  Charles LeMieux, Portfolio Manager, and Senior Vice President of Voya Investment Management's Senior Loan Group will retire effective on May 31, 2021 and therefore will no longer serve as portfolio manager of the Trust.

Voya Prime Rate Trust

PORTFOLIO MANAGERS' REPORT (continued)

Based on a $10,000 initial investment, the graph and table above illustrate the total return of the Trust against the index indicated. The index is unmanaged and has no cash in its portfolio, imposes no sales charges and incurs no operating expenses. An investor cannot invest directly in an index.

Total returns shown include, if applicable, the effect of fee waivers and/or expense reimbursements by Voya Investments, LLC. Had all fees and expenses been considered, the total returns would have been lower.

Performance data represents past performance and is no guarantee of future results. Investment return and principal value of an investment in the Trust will fluctuate. Shares, when sold, may be worth more or less than their original cost. The Trust's future performance may be lower or higher than the performance data shown. Please log on to www.voyainvestments.com or call (800) 336-3436 to get performance through the most recent month end.

Calculation of total return assumes a hypothetical initial investment at the net asset value (in the case of NAV) or the New York Stock Exchange ("NYSE") Composite closing price (in the case of Market Value) on the last business day before the first day of the stated period, with all dividends and distributions reinvested at the actual reinvestment price.

Senior loans are subject to credit risks and the potential for non-payment of scheduled principal or interest payments, which may result in a reduction of the Trust's NAV.

This report contains statements that may be "forward-looking" statements. Actual results could differ materially from those projected in the "forward-looking" statements.

The commentary provided was based in part upon attribution analysis from FactSet and is for informational purposes only and is not intended as investment advice. The commentary may reference current holdings as well as holdings that may have been sold during the period. Performance figures for individual sectors and individual holdings in FactSet attribution are gross of fees. Results are on a gross of fees basis.

The attribution analysis from FactSet compares loan level performance of the portfolio to the index. FactSet attribution does not include any other fund performance attribution impact (e.g., structural impacts, intraday trade prices, fee income, cash, etc). Further, certain assumptions are made in FactSet's model for the calculation of daily total returns for loans in the portfolio, including how FactSet accrues income and calculates coupon, both of which may have an impact on the derived total return used in the attribution analysis. FactSet obtains daily weights and returns for the index directly from S&P/LCD. The calculated returns used in the attribution analysis are not accounting-based returns. Investment performance presented differs from actual performance and was not constructed according to the input, calculation, presentation, and disclosure requirements of the Global Investment Performance Standards (GIPS). Attribution analysis is intended only to directionally understand drivers of performance and is not intended to convey unintended precision or accuracy. FactSet attribution results can vary, even for historical periods, from previously run attribution reports for those same periods. These variances can be a result of changes to

Voya Prime Rate Trust

PORTFOLIO MANAGERS' REPORT (continued)

FactSet's system, improvements or revisions to calculation methodology, or data reconciliation efforts. Voya IM believes that attribution and statements based on attribution are directionally useful for understanding performance, but Voya IM does not represent that such information is accurate or complete.

The views expressed in this report reflect those of the portfolio managers only through the end of the period of the report as stated on the cover. The portfolio managers' views are subject to change at any time based on market and other conditions.

^(A)  Yield is calculated by dividing the Trust's net investment income per share for the most recent thirty days by the net asset value (in the case of NAV) or the NYSE Composite closing price (in the case of Market) at quarter-end. Yield calculations do not include any commissions or sales charges, and are compounded for six months and annualized for a twelve-month period to derive the Trust's yield consistent with the U.S. Securities and Exchange Commission ("SEC") standardized yield formula.

^(B)  The distribution rate is calculated by annualizing the last regular dividend and distribution declared during the period using the 30/360 convention by the Trust's reporting period-end net asset value (in the case of NAV) or the reporting period-end NYSE Composite closing price (in the case of Market). The distribution rate is based solely on the actual dividends and distributions, which are made at the discretion of management. The distribution rate includes distributions from net investment income, but does not include capital gains or losses.

In pursuit of its investment objectives, the Trust may seek to increase or decrease its exposure to the following market or credit risk factors:

Derivative Risk: Derivative instruments are subject to a number of risks, including the risk of changes in the market price of the underlying securities, credit risk with respect to the counterparty, risk of loss due to changes in market interest rates and liquidity and volatility risk. The amounts required to purchase certain derivatives may be small relative to the magnitude of exposure assumed by the Trust. Therefore, the purchase of certain derivatives may have an economic leveraging effect on the Trust and exaggerate any increase or decrease in the net asset value. Derivatives may not perform as expected, so the Trust may not realize the intended benefits. When used for hedging purposes, the change in value of a derivative may not correlate as expected with the currency, security or other risk being hedged. When used as an alternative or substitute for direct cash investments, the return provided by the derivative may not provide the same return as direct cash investment. In addition, given their complexity, derivatives expose the Trust to the risk of improper valuation.

Credit Risk: Prices of the Trust's investments are likely to fall if the actual or perceived financial health of the borrowers on, or issuers of, such investments deteriorates, whether because of broad economic or issuer-specific reasons, or if the borrower or issuer is late (or defaults) in paying interest or principal. The Trust invests a substantial portion of its assets in below investment-grade senior loans and other below investment-grade assets. Below investment-grade loans commonly known as high-yielding, high risk investments or as "junk" investments involve a greater risk that borrowers may not make timely payment of the interest and principal due on their loans and are subject to greater levels of credit and liquidity risks. They also involve a greater risk that the value of such loans could decline significantly. If borrowers do not make timely payments of the interest due on their loans, the yield on the Common Shares will decrease. If borrowers do not make timely payment of the principal due on their loans, or if the value of such loans decreases, the NAV will decrease.

Voya Prime Rate Trust

PORTFOLIO MANAGERS' REPORT (continued)

Interest Rate Risk: Changes in short-term market interest rates will directly affect the yield on Common Shares. If short-term market interest rates fall, the yield on Common Shares will also fall. To the extent that the interest rate spreads on loans in the Trust's portfolio experience a general decline, the yield on the Common Shares will fall and the value of the Trust's assets may decrease, which will cause the Trust's NAV to decrease. Conversely, when short-term market interest rates rise, because of the lag between changes in such short-term rates and the resetting of the floating rates on assets in the Trust's portfolio, the impact of rising rates will be delayed to the extent of such lag. In the case of inverse securities, the interest rate paid by such securities generally will decrease when the market rate of interest to which the inverse security is indexed increases. With respect to investments in fixed rate instruments, a rise in market interest rates generally causes values of such instruments to fall. The values of fixed rate instruments with longer maturities or duration are more sensitive to changes in market interest rates.

As of the date of this report, the United States experiences a low interest rate environment, which may increase the Trust's exposure to risks associated with rising market interest rates. Rising market interest rates could have unpredictable effects on the markets and may expose fixed-income and related markets to heightened volatility which could reduce liquidity for certain investments, adversely affect values, and increase costs. If dealer capacity in fixed-income and related markets is insufficient for market conditions, it may further inhibit liquidity and increase volatility in the fixed-income and related markets. Further, recent and potential changes in government policy may affect interest rates.

Leverage Risk: The use of leverage through borrowings or the issuance of Preferred Shares can adversely affect the yield on the Common Shares. To the extent that the Trust is unable to invest the proceeds from the use of leverage in assets which pay interest at a rate which exceeds the rate paid on the leverage, the yield on the Common Shares will decrease. In addition, in the event of a general market decline in the value of assets such as those in which the Trust invests, the effect of that decline will be magnified in the Trust because of the additional assets purchased with the proceeds of the leverage. Further, because the fee paid to the Adviser will be calculated on the basis of Managed Assets, the fee will be higher when leverage is utilized, giving the Adviser an incentive to utilize leverage. The Trust is subject to certain restrictions imposed by lenders to the Trust and may be subject to certain restrictions imposed by guidelines of one or more rating agencies which may issue ratings for debt or the Preferred Shares issued by the Trust. These restrictions are expected to impose asset coverage, fund composition requirements and limits on investment techniques, such as the use of financial derivative products that are more stringent than those imposed on the Trust by the Investment Company Act of 1940, as amended (the "1940 Act"). These restrictions could impede the manager from fully managing the Trust's portfolio in accordance with the Trust's investment objective and policies.

Voya Prime Rate Trust

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and Board of Trustees of
Voya Prime Rate Trust

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities of Voya Prime Rate Trust (the "Trust"), including the portfolio of investments, as of February 28, 2021, and the related statements of operations and cash flows for the year then ended, the statements of changes in net assets and the financial highlights for each of the two years in the period then ended and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Trust at February 28, 2021, the results of its operations and its cash flows for the year then ended, the changes in its net assets and its financial highlights for each of the two years in the period then ended, in conformity with U.S. generally accepted accounting principles.

The financial highlights for each of the years in the eight-year period ended February 28, 2019, were audited by another independent registered public accounting firm whose report, dated April 26, 2019, expressed an unqualified opinion on those financial highlights.

Basis for Opinion

These financial statements are the responsibility of the Trust's management. Our responsibility is to express an opinion on the Trust's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Trust in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Trust is not required to have, nor were we engaged to perform, an audit of the Trust's internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Trust's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of February 28, 2021, by correspondence with the custodian and others or by other appropriate auditing procedures where replies from others were not received. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

We have served as the auditor of one or more Voya investment companies since 2019.

Boston, Massachusetts
April 29, 2021

Voya Prime Rate Trust

STATEMENT OF ASSETS AND LIABILITIES as of February 28, 2021

Voya Prime Rate Trust

STATEMENT OF OPERATIONS for the Year Ended February 28, 2021

Voya Prime Rate Trust

STATEMENTS OF CHANGES IN NET ASSETS

Voya Prime Rate Trust

STATEMENT OF CASH FLOWS for the Year Ended February 28, 2021

FINANCIAL HIGHLIGHTS

Selected data for a share of beneficial interest outstanding throughout each year or period.

⁽¹⁾  Total investment return calculations are attributable to Common Shares.

⁽²⁾  Total investment return at net asset value has been calculated assuming a purchase at net asset value at the beginning of each period and a sale at net asset value at the end of each period and assumes reinvestment of dividends, capital gain distributions and return of capital distributions/allocations, if any, in accordance with the provisions of the dividend reinvestment plan. Total investment return at net asset value is not annualized for periods less than one year.

⁽³⁾  Total investment return at market value measures the change in the market value of your investment assuming reinvestment of dividends, capital gain distributions, and return of capital/allocations, if any, in accordance with the provisions of the dividend reinvestment plan.

⁽⁴⁾  The Investment Adviser has entered into a written expense limitation agreement with the Trust under which it will limit the expenses of the Trust (excluding interest, taxes, investment-related costs, leverage expenses, extraordinary expenses and acquired fund fees and expenses) subject to possible recoupment by the Investment Adviser within three years of being incurred.

⁽⁵⁾  Annualized for periods less than one year.

⁽⁶⁾  Please see Note 7 in the accompanying Notes to Financial Statements for additional information.

*  Amount is less than $0.005 or more than $(0.005).

•  Calculated using average number of shares outstanding throughout the year or period.

FINANCIAL HIGHLIGHTS (continued)

Selected data for a share of beneficial interest outstanding throughout each year or period.

(a)  Asset coverage ratios, for fiscal periods beginning after 2011, is presented to represent the coverage available to each $1,000 of borrowings. The Asset coverage ratio per $1,000 of debt is presented to represent the coverage available to each $1,000 of borrowings before consideration of any Preferred Shares liquidation price, while the Asset coverage inclusive of

Preferred Shares, presents the coverage available to both borrowings and Preferred Shares, expressed in relation to the per share liquidation price of the Preferred Shares.

⁽¹⁾  Annualized for periods less than one year.

Voya Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of February 28, 2021

NOTE 1 — ORGANIZATION

Voya Prime Rate Trust (the "Trust"), a Massachusetts business trust, is registered under the 1940 Act, as a diversified, closed-end, management investment company. The Trust invests at least 80% of its assets (plus borrowings for investment purposes) in senior loans, which generally are not registered under the Securities Act of 1933, as amended (the "1933 Act"), and which contain certain restrictions on resale and cannot be sold publicly. These loans bear interest (unless otherwise noted) at rates that float periodically at a margin above the London Inter-Bank Offered Rate ("LIBOR") and other short-term rates. The investment objective of the Trust is described in the Trust's prospectus.

Voya Investments, LLC ("Voya Investments" or the "Investment Adviser"), an Arizona limited liability company, serves as the Investment Adviser to the Trust. The Investment Adviser has engaged Voya Investment Management Co. LLC ("Voya IM" or the "Sub-Adviser"), a Delaware limited liability company, to serve as the Sub-Adviser to the Trust. On February 24, 2021, it was announced that Voya Investments will resign as the Investment Adviser and Voya IM will no longer serve as the Sub-Adviser to the Trust. Please see Note 17 for additional details.

NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES

The following significant accounting policies are consistently followed by the Trust in the preparation of its financial statements. The Trust is considered an investment company under U.S. generally accepted accounting principles ("GAAP") and follows the accounting and reporting guidance applicable to investment companies.

A.  Senior Loan and Other Security Valuation. The Trust is open for business every day the New York Stock Exchange ("NYSE") opens for regular trading (each such day, a "Business Day"). The net asset value ("NAV") per Common Share of the Trust is determined each Business Day as of the close of the regular trading session ("Market Close"), as determined by the Consolidated Tape Association ("CTA"), the central distributor of transaction prices for exchange-traded securities (normally 4:00 p.m. Eastern time unless otherwise designated by the CTA). The data reflected on the consolidated tape provided by the CTA is generated by various market centers, including all securities exchanges, electronic communications networks, and third-market broker-dealers. The NAV per Common Share of the Trust is calculated by dividing the value of the Trust's loan assets plus all cash and other assets (including accrued expenses but excluding capital and surplus) attributable to the Common Shares by the number of Common Shares outstanding. The NAV per Common Share is made available for publication. On days when the Trust is closed for business, Trust shares will not be priced and the Trust does not transact purchase and redemption orders. To the extent the Trust's assets are traded in other markets on days when the Trust does not price its shares, the value of the Trust's assets will likely change and you will not be able to purchase or redeem shares of the Trust.

Assets for which market quotations are readily available are valued at market value. A security listed or traded on an exchange is valued at its last sales price or official closing price as of the close of the regular trading session on the exchange where the security is principally traded or, if such price is not available, at the last sale price as of the Market Close for such security provided by the CTA. Bank loans are valued at the average of the averages of the bid and ask prices provided to an independent loan pricing service by brokers. Futures contracts are valued at the final settlement price set by an exchange on which they are principally traded. Listed options are valued at the mean between the last bid and ask prices from the exchange on which they are principally traded. Investments in open-end registered investment companies that do not trade on an exchange are valued at the end of day NAV per share. Investments in registered investment companies that trade on an exchange are valued at the last sales price or official closing price as of the close of the regular trading session on the exchange where the security is principally traded.

When a market quotation is not readily available or is deemed unreliable, the Trust will determine a fair value for the relevant asset in accordance with the Trust's valuation procedures. Such procedures

Voya Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of February 28, 2021 (continued)

NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (continued)

provide, for example, that: (a) Exchange-traded securities are valued at the mean of the closing bid and ask; (b) Debt obligations are valued using an evaluated price provided by an independent pricing service. Evaluated prices provided by the pricing service may be determined without exclusive reliance on quoted prices, and may reflect factors such as institution-size trading in similar groups of securities, developments related to specific securities, benchmark yield, quality, type of issue, coupon rate, maturity, individual trading characteristics and other market data; (c) Securities traded in the over-the-counter ("OTC") market are valued based on prices provided by independent pricing services or market makers; (d) Options not listed on an exchange are valued by an independent source using an industry accepted model, such as Black-Scholes; (e) Centrally cleared swap agreements are valued using a price provided by the central counterparty clearinghouse; (f) OTC swap agreements are valued using a price provided by an independent pricing service; (g) Forward foreign currency exchange contracts are valued utilizing current and forward rates obtained from an independent pricing service. Such prices from the third party pricing service are for specific settlement periods and the Trust's forward foreign currency exchange contracts are valued at an interpolated rate between the closest preceding and subsequent period reported by the independent pricing service; and (h) Securities for which market prices are not provided by any of the above methods may be valued based upon quotes furnished by brokers.

The prospectuses of the open-end registered investment companies in which the Trust may invest explain the circumstances under which they will use fair value pricing and the effects of using fair value pricing.

Foreign securities' (including forward foreign currency exchange contracts) prices are converted into U.S. dollar amounts using the applicable exchange rates as of Market Close. If market quotations are available and believed to be reliable for foreign exchange-traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end before Market Close, closing market quotations may become unreliable. An independent pricing service determines the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current value as of Market Close. Foreign securities' prices meeting the approved degree of certainty that the price is not reflective of current value will be valued by the independent pricing service using pricing models designed to estimate likely changes in the values of those securities between the times in which the trading in those securities is substantially completed and Market Close. Multiple factors may be considered by the independent pricing service in determining the value of such securities and may include information relating to sector indices, American Depositary Receipts and domestic and foreign index futures.

All other assets for which market quotations are not readily available or became unreliable (or if the above fair valuation methods are unavailable or determined to be unreliable) are valued at fair value. The Investment Adviser is responsible for overseeing the implementation of the Trust's valuation procedures; a "Pricing Committee" comprised of employees of the Investment Adviser or its affiliates has responsibility for applying the fair valuation methods set forth in the procedures and, if a fair valuation cannot be determined pursuant to the fair valuation methods, determining the fair value of assets held by the Trust. Issuer specific events, transaction price, position size, nature and duration of restrictions on disposition of the security, market trends, bid/ask quotes of brokers and other market data may be reviewed in the course of making a good faith determination of a security's fair value. Valuations change in response to many factors including the historical and prospective earnings of the issuer, the value of the issuer's assets, general economic conditions, interest rates, investor perceptions and market liquidity. Because of the inherent uncertainties of fair valuation, the values used to determine the Trust's NAV may materially differ from the value received upon actual sale of those investments. Thus, fair valuation may have an unintended dilutive or accretive effect on the value of shareholders' investments in the Trust.

Each investment asset or liability of the Trust is assigned a level at measurement date based on the significance and source of the inputs to its valuation. Quoted prices in active markets for identical securities are classified as "Level 1," inputs other than quoted prices for an asset or liability that are observable are classified as "Level 2" and significant unobservable inputs, including the Sub-Adviser's or

Voya Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of February 28, 2021 (continued)

NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (continued)

Pricing Committee's judgment about the assumptions that a market participant would use in pricing an asset or liability are classified as "Level 3." The inputs used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. Short-term securities of sufficient credit quality are generally considered to be Level 2 securities under applicable accounting rules. A table summarizing the Trust's investments under these levels of classification is included within the Portfolio of Investments.

GAAP requires a reconciliation of the beginning to ending balances for reported fair values that presents changes attributable to total realized and unrealized gains or losses, purchases and sales, and transfers in or out of the Level 3 category during the period. A reconciliation of Level 3 investments within the Portfolio of Investments is presented only when the Trust has a significant amount of Level 3 investments.

B.  Security Transactions and Revenue Recognition. Security transactions and senior loans are accounted for on the trade date (date the order to buy or sell is executed). The unfunded portion of revolver and delayed draw loans are booked once that portion becomes funded. Realized gains or losses are reported on the basis of identified cost of securities sold. Interest income is recorded on an accrual basis at the then-current loan rate. The accrual of interest on loans is partially or fully discontinued when, in the opinion of management, there is an indication that the borrower may be unable to meet payments as they become due. If determined to be uncollectible, unpaid accrued interest is also written off. Cash collections on non-accrual senior loans are generally applied as a reduction to the recorded investment of the loan. Senior loans are generally returned to accrual status only after all past due amounts have been received and the borrower has demonstrated sustained performance. Premium amortization and discount accretion are deferred and recognized over the lives of the respective loans. Arrangement fees received on revolving credit facilities, which represent non-refundable fees or purchase discounts associated with the acquisition of loans, are deferred and recognized using the effective yield method over the shorter of four years or the actual term of the loan. No such fees are recognized on loans which have been placed on non-accrual status. Arrangement fees associated with all other loans, except revolving credit facilities, are treated as discounts and are accreted as described above. Dividend income is recorded on the ex-dividend date. Amendment fees are earned as compensation for evaluating and accepting changes to an original senior loan agreement and are recognized when received. Amendment fees and other fees earned are reported as other income on the Statement of Operations.

C.  Foreign Currency Translation. The books and records of the Trust are maintained in U.S. dollars. Any foreign currency amounts are translated into U.S. dollars on the following basis:

(1)  Market value of investment securities, other assets and liabilities — at the exchange rates prevailing at Market Close.

(2)  Purchases and sales of investment securities, income and expenses — at the rates of exchange prevailing on the respective dates of such transactions.

Although the net assets and the market values are presented at the foreign exchange rates at Market Close, the Trust does not isolate the portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gains or losses from investments. For securities, which are subject to foreign withholding tax upon disposition, liabilities are recorded on the Statement of Assets and Liabilities for the estimated tax withholding based on the securities current market value. Upon disposition, realized gains or losses on such securities are recorded net of foreign withholding tax.

Reported net realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Trust's books,

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NOTES TO FINANCIAL STATEMENTS as of February 28, 2021 (continued)

NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (continued)

and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign exchange gains and losses arise from changes in the value of assets and liabilities other than investments in securities, resulting from changes in the exchange rate. Foreign security and currency transactions may involve certain considerations and risks not typically associated with investing in U.S. companies and the U.S. government. These risks include, but are not limited to, revaluation of currencies and future adverse political and economic developments which could cause securities and their markets to be less liquid and prices more volatile than those of comparable U.S. companies and U.S. government securities.

D.  Forward Foreign Currency Contracts. The Trust has entered into forward foreign currency contracts primarily to hedge against foreign currency exchange rate risks on its non-U.S. dollar denominated investment securities. When entering into a currency forward foreign contract, the Trust agrees to receive or deliver a fixed quantity of foreign currency for an agreed-upon price on an agreed future date. These contracts are valued daily and the Trust's net equity therein, representing unrealized gain or loss on the contracts as measured by the difference between the forward foreign exchange rates at the dates of entry into the contracts and the forward rates at the reporting date, is included in the Statement of Assets and Liabilities. Realized and unrealized gains and losses are included in the Statement of Operations. These instruments involve market and/or credit risk in excess of the amount recognized in the Statement of Assets and Liabilities. Risks arise from the possible inability of counterparties to meet the terms of their contracts and from movement in currency and securities values and interest rates. Open forward foreign currency contracts are presented within the respective Portfolio of Investments.

For the year ended February 28, 2021, the Trust had an average quarterly contract amount on forward foreign currency contracts to buy and sell of $2,271,241 and $37,230,160, respectively. Please refer to the table within the Portfolio of Investments for open forward foreign currency contracts to buy and sell at February 28, 2021.

E.  When-Issued Delayed-Delivery. Securities purchased or sold on a when-issued, delayed-delivery or forward purchase commitment basis may have extended settlement periods. The value of the security so purchased is subject to market fluctuations during this period. Due to the nature of the Senior Loan market, the actual settlement date may not be certain at the time of the purchase or sale for some of the Senior Loans. Interest income on such Senior Loans is not accrued until settlement date.

F.  Federal Income Taxes. It is the policy of the Trust to comply with the requirements of subchapter M of the Internal Revenue Code that are applicable to regulated investment companies and to distribute substantially all of its net investment income and any net realized capital gains to its shareholders. Therefore, a federal income tax or excise tax provision is not required. Management has considered the sustainability of the Trust's tax positions taken on federal income tax returns for all open tax years in making this determination. No capital gain distributions shall be made until the capital loss carryforwards have been fully utilized.

The Trust may utilize equalization accounting for tax purposes, whereby a portion of redemption payments are treated as distributions of income or gain.

G.  Distributions to Common Shareholders. The Trust declares and pays dividends monthly from net investment income. Distributions from capital gains, if any, are declared and paid annually. The Trust may make additional distributions to comply with the distribution requirements of the Internal Revenue Code. The character and amounts of income and gains to be distributed are determined in accordance with federal income tax regulations, which may differ from GAAP for investment companies. Distributions in excess of net investment income and/or net realized capital gains for tax purposes are reported as return of capital. The Trust records distributions to its shareholders on the ex-dividend date.

H.  Use of Estimates. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and

Voya Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of February 28, 2021 (continued)

NOTE 2 — SIGNIFICANT ACCOUNTING POLICIES (continued)

liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

I.  Dividend Reinvestments. Pursuant to the Trust's Shareholder Reinvestment Program (the "Program"), BNY Mellon Investment Servicing (U.S.) Inc. ("BNY"), the Program administrator, purchases, from time to time, shares of beneficial interest of the Trust on the open market to satisfy dividend reinvestments. Such shares are purchased on the open market only when the closing sale or bid price plus commission is less than the NAV per share of the Trust's Common Shares on the valuation date. If the market price plus commissions is equal to or exceeds NAV, new shares are issued by the Trust at the greater of (i) NAV or (ii) the market price of the shares during the pricing period, minus a discount of 5%.

J.  Share Offerings. The Trust issues shares under various shelf registration statements, whereby the net proceeds received by the Trust from share sales may not be less than the greater of (i) the NAV per share or (ii) 94% of the average daily market price over the relevant pricing period.

K.  Indemnifications. In the normal course of business, the Trust may enter into contracts that provide certain indemnifications. The Trust's maximum exposure under these arrangements is dependent on future claims that may be made against the Trust and, therefore, cannot be estimated; however, based on experience, management considers the risk of loss from such claims remote.

NOTE 3 — INVESTMENTS

For the year ended February 28, 2021, the cost of purchases and the proceeds from principal repayment and sales of investments, excluding short-term notes, totaled $482,264,868 and $979,224,232, respectively. At February 28, 2021, the Trust held senior loans valued at $582,435,678 representing 99.4% of its total investments. The fair value of these assets is established as set forth in Note 2.

The senior loans acquired by the Trust typically take the form of a direct lending relationship with the borrower, and are typically acquired through an assignment of another lender's interest in a loan. The lead lender in a typical corporate loan syndicate administers the loan and monitors the collateral securing the loan. In the event that the lead lender becomes insolvent, enters Federal Deposit Insurance Corporation ("FDIC") receivership or, if not FDIC insured, enters into bankruptcy, the Trust may incur certain costs and delays in realizing payment, or may suffer a loss of principal and/or interest.

Common and Preferred Shares, and stock purchase warrants held in the portfolio were acquired in conjunction with loans held by the Trust. Certain stocks and warrants are restricted and may not be publicly sold without registration under the 1933 Act, or without an exemption under the 1933 Act. In some cases, these restrictions expire after a designated period of time after issuance of the shares or warrants.

NOTE 4 — INVESTMENT MANAGEMENT FEES

The Trust has entered into an investment management agreement ("Management Agreement") with the Investment Adviser. The Investment Adviser has overall responsibility for the management of the Trust. The Investment Adviser oversees all investment advisory and portfolio management services for the Trust and assists in managing and supervising all aspects of the general day-to-day business activities and operations of the Trust, including custodial, transfer agency, dividend disbursing, accounting, auditing, compliance and related services. This Management Agreement compensates the Investment Adviser with a fee, computed daily and payable monthly, at an annual rate of 1.05% of the Trust's managed assets. For purposes of the Management Agreement, managed assets ("Managed Assets") are defined as the Trust's average daily gross asset value, minus the sum of the Trust's accrued and unpaid dividends on any outstanding Preferred Shares and accrued liabilities (other than liabilities for the principal amount of any

Voya Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of February 28, 2021 (continued)

NOTE 4 — INVESTMENT MANAGEMENT FEES (continued)

borrowings incurred, commercial paper or notes issued by the Trust and the liquidation preference of any outstanding Preferred Shares).

The Investment Adviser has entered into a sub-advisory agreement with Voya IM. Voya IM provides investment advice for the Trust and is paid by the Investment Adviser based on the average daily Managed Assets of the Trust. Subject to such policies as the Trust's Board of Trustees ("Board") or the Investment Adviser may determine, Voya IM manages the Trust's assets in accordance with the Trust's investment objectives, policies, and limitations.

NOTE 5 — EXPENSE LIMITATION AGREEMENT

The Investment Adviser has agreed to limit expenses, excluding interest, taxes, investment-related costs, leverage expenses, extraordinary expenses, and acquired fund fees and expenses, to 1.05% of Managed Assets plus 0.15% of average daily net assets.

The Investment Adviser may at a later date recoup from the Trust for fees waived and/or other expenses reimbursed by the Investment Adviser during the previous 36 months, but only if, after such recoupment, the Trust's expense ratio does not exceed the percentage described above. Waived and reimbursed fees net of any recoupment by the Investment Adviser of such waived and reimbursed fees are reflected on the accompanying Statement of Operations. Amounts payable by the Investment Adviser are reflected on the accompanying Statement of Assets and Liabilities.

As of February 28, 2021, the amount of waived and/or reimbursed fees that are subject to recoupment by the Investment Adviser and the related expiration dates are as follows:

The expense limitation agreement is contractual through July 1, 2021 and shall renew automatically for one-year terms. Termination or modification of this obligation requires approval by the Board.

NOTE 6 — TRANSACTIONS WITH AFFILIATES AND OTHER PARTIES

During the year ended February 28, 2021, the Trust incurred $3,015,982 of costs related to the annual shareholder meeting, including the cost of services provided by legal counsel to the Trust and to the independent trustees. The Investment Adviser reimbursed the Trust $2,074,311 of these costs.

At February 28, 2021, Saba Capital Management GP, LLC owned approximately 22.46% of the Trust.

Prior to July 14, 2021, the Trust has adopted a deferred compensation plan (the "DC Plan"), which allowed previous eligible independent trustees, as described in the DC Plan, to defer the receipt of all or a portion of the previous trustees' fees that they are entitled to receive from the Trust. For purposes of determining the amount owed to the previous trustee under the DC Plan, the amounts deferred are invested in shares of the funds selected by the previous trustee (the "Notional Funds"). When the Trust purchases shares of the Notional Funds, which are all advised by Voya Investments, in amounts equal to the previous trustees' deferred fees, this results in a Trust asset equal to the deferred compensation liability. Such assets, if applicable, are included as a component of "Other assets" on the accompanying Statement of Assets and Liabilities. Deferral of previous trustees' fees under the DC Plan will not affect net assets of the Trust, and will not materially affect the Trust's assets, liabilities or net investment income per share. Amounts will be deferred until distributed in accordance with the DC Plan.

The Trust may engage in purchase and sale transactions with funds that have a common investment adviser (or affiliated investment adviser) and/or have a common sub-adviser. These interfund transactions are made pursuant to Rule 17a-7 under the 1940 Act. For the year ended February 28, 2021, the Trust engaged in such purchase and sale transactions totaling $43,817,885 and $119,998,484, respectively.

Voya Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of February 28, 2021 (continued)

NOTE 7 — TENDER OFFER

On December 3, 2020, the Trust announced that it would purchase for cash up to 15% of the Trust's shares, at a price equal to 99% of the Trust's NAV per share as determined as of the close of the regular trading session of the NYSE on January 4, 2021 (the "Tender Offer"). On January 4, 2021, 21,576,552 shares were accepted for repurchase by the Trust in accordance with the terms of the Tender Offer. The shares were repurchased at a price of $4.86, 99% of the Trust's NAV. The Tender Offer was oversubscribed and all tenders of shares were subject to pro ration (at a ratio of approximately 0.2440) in accordance with the terms of the Tender Offer. During the year ended February 28, 2021, the Trust incurred $230,190 of costs related to the Tender Offer.

NOTE 8 — COMMITMENTS

Effective July 8, 2020, the Trust entered into an extension of an existing revolving credit agreement, collateralized by assets of the Trust, to borrow up to $300 million maturing August 21, 2020. Effective August 21, 2020, the Board approved an extension with a maturity date of September 21, 2020. Effective September 21, 2020, the Board approved an additional extension with a maturity date of October 21, 2020. Effective October 21, 2020, the borrowing amount under the revolving credit agreement was reduced to $240 million. The Board approved this additional extension with a maturity date of April 21, 2021 and the borrowing rates under this agreement are based on a fixed spread over LIBOR, and a commitment fee is charged on the unused portion. Effective January 11, 2021, following the Tender Offer closing, the aggregate commitment amount under the revolving credit agreement was automatically reduced to $200 million. Prior to July 8, 2020, the predecessor credit agreement was for $390 million, which matured on July 8, 2020. The amount of borrowings outstanding at February 28, 2021 was $22.6 million. The weighted average interest rate on outstanding borrowings at February 28, 2021 was 1.22%, excluding fees related to the unused portion of the facilities, and other fees. The amount of borrowings represented 3.47% of total assets at February 28, 2021. Prepaid arrangement fees are amortized over the term of the agreement. Average borrowings for the year ended February 28, 2021 were $211,065,753 and the average annualized interest rate was 1.76% excluding other fees related to the unused portion of the facility, and other fees.

The Board has determined that it is in the best interest of the Trust and its shareholders to repay the Trust's outstanding borrowings under the Trust's credit agreement to address concerns about terms related to the credit agreement and the Trust's ability to obtain a long-term extension of the credit agreement. As of February 28, 2021, the Sub-Adviser has completed selling senior loans sufficient to pay the outstanding balance of the credit agreement and, pending settlement of those loans, will temporarily manage the Trust without the use of leverage. The Trust may use leverage in the future.

As of February 28, 2021, the Trust had unfunded loan commitments pursuant to the terms of the following loan agreements:

NOTE 9 — RIGHTS AND OTHER OFFERINGS

As of February 28, 2021, outstanding share offerings pursuant to shelf registrations were as follows:

As of February 28, 2021, the Trust had no Preferred Shares outstanding. The Trust may consider issuing Preferred Shares during the current fiscal year or in the future.

Voya Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of February 28, 2021 (continued)

NOTE 10 — SUBORDINATED LOANS AND UNSECURED LOANS

The Trust may invest in subordinated loans and in unsecured loans. The primary risk arising from investing in subordinated loans or in unsecured loans is the potential loss in the event of default by the issuer of the loans. The Trust may acquire a subordinated loan only if, at the time of acquisition, it acquires or holds a senior loan from the same borrower. The Trust will acquire unsecured loans only where the Investment Adviser believes, at the time of acquisition, that the Trust would have the right to payment upon default that is not subordinate to any other creditor. Subject to the aggregate 20% limit on other investments, the Trust may invest up to 20% of its total assets in unsecured floating rate loans, notes and other debt instruments and 5% of its total assets in floating rate subordinated loans. As of February 28, 2021, the Trust held no subordinated loans or unsecured loans.

NOTE 11 — CAPITAL SHARES

Transactions in capital shares and dollars were as follows:

Share Repurchase Program

Effective April 1, 2020, pursuant to an open-market share repurchase program, the Trust may purchase, over the period ending March 31, 2021, up to 10% of its stock in open-market transactions. Previously, pursuant to an open-market share repurchase program effective November 21, 2019, the Trust could have purchased, over the period ended March 31, 2020, up to 10% of its stock in open-market transactions. The amount and timing of the repurchases will be at the discretion of the Trust's management, subject to market conditions and investment considerations. There is no assurance that the Trust will purchase shares at any particular discount level or in any particular amounts. Any repurchases made under this program would be made on a national securities exchange at the prevailing market price, subject to exchange requirements and volume, timing and other limitations under federal securities laws. The share repurchase program seeks to enhance shareholder value by purchasing shares trading at a discount from their NAV per share. The open-market share repurchase program does not obligate the Trust to repurchase any dollar amount or number of shares of its stock.

For the year ended February 28, 2021, the Trust repurchased 4,369,649 shares, representing approximately 3.6% of the Trust's outstanding shares for a net purchase price of $18,727,020 (including commissions of $109,241). Shares were repurchased at a weighted-average discount from NAV per share of 9.98% and a weighted-average price per share of $4.29.

For the year ended February 29, 2020, the Trust had no repurchases.

NOTE 12 — FEDERAL INCOME TAXES

The amount of distributions from net investment income and net realized capital gains are determined in accordance with federal income tax regulations, which may differ from GAAP for investment companies. These book/tax differences may be either temporary or permanent. Permanent differences are reclassified within the capital accounts based on their federal tax-basis treatment; temporary differences are not reclassified. Key differences include the treatment of foreign currency transactions, capital loss carryforwards, and wash sale deferrals. Distributions in excess of net investment income and/or net realized capital gains for tax purposes are reported as return of capital.

Voya Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of February 28, 2021 (continued)

NOTE 12 — FEDERAL INCOME TAXES (continued)

The following permanent tax differences have been reclassified as of February 28, 2021:

Dividends paid by the Trust from net investment income and distributions of net realized short-term capital gains are, for federal income tax purposes, taxable as ordinary income to shareholders.

The tax composition of dividends and distributions to shareholders was as follows:

The tax-basis components of distributable earnings and the capital loss carryforwards which may be used to offset future realized capital gains for federal income tax purposes as of February 28, 2021 were:

The Trust's major tax jurisdictions are U.S. federal and Arizona state.

As of February 28, 2021, no provision for income tax is required in the Trust's financial statements as a result of tax positions taken on federal and state income tax returns for open tax years. The Trust's federal and state income and federal excise tax returns for tax years for which the applicable statutes of limitations have not expired are subject to examination by the Internal Revenue Service and state department of revenue. Generally, the preceding four tax years remain subject to examination by these jurisdictions.

NOTE 13 — LIBOR

The U.K. Financial Conduct Authority has announced that it intends to stop persuading or compelling banks to submit LIBOR rates after 2021, and it remains unclear whether LIBOR will continue to exist after that date and, if so, in what form. Actions by regulators have resulted in the establishment of alternative reference rates to LIBOR in many major currencies. The U.S. Federal Reserve Board, based on the recommendations of the New York Federal Reserve's Alternative Reference Rate Committee (comprised of major derivative market participants and their regulators), has begun publishing a Secured Overnight Funding Rate ("SOFR") that is intended to replace U.S. dollar LIBOR. Proposals for alternative reference rates for other currencies have also been announced or have already begun publication.

Discontinuance of LIBOR and adoption/implementation of alternative rates pose a number of risks, including among others whether any substitute rate will experience the market participation and liquidity necessary to provide a workable substitute for LIBOR; the effect on parties' existing contractual arrangements, hedging transactions, and investment strategies generally from a conversion from LIBOR to alternative rates; the effect on the Trust's existing investments (including, for example, fixed-income investments; senior loans; CLOs and CDOs; and derivatives transactions), including the possibility that some of those investments may terminate or their terms may be adjusted to the disadvantage of the Trust; and the risk of general market disruption during the period of the conversion. It is difficult to predict at this time the likely impact of the transition away from LIBOR on the Trust. On November 30, 2020, the administrator of LIBOR announced a delay in the phase out of a majority of the U.S. dollar LIBOR publications until June 30, 2023, with the remainder of LIBOR publications to still end at the end of 2021.

Voya Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of February 28, 2021 (continued)

NOTE 14 — MARKET DISRUPTION

The Trust is subject to the risk that geopolitical events will disrupt securities markets and adversely affect global economies and markets. Due to the increasing interdependence among global economies and markets, conditions in one country, market, or region might adversely impact markets, issuers and/or foreign exchange rates in other countries, including the United States. War, terrorism, global health crises and pandemics, and other geopolitical events have led, and in the future may lead, to increased market volatility and may have adverse short- or long-term effects on U.S. and world economies and markets generally. For example, the COVID-19 pandemic has resulted, and may continue to result, in significant market volatility, exchange trading suspensions and closures, declines in global financial markets, higher default rates, and a substantial economic downturn in economies throughout the world. Natural and environmental disasters and systemic market dislocations are also highly disruptive to economies and markets. Those events as well as other changes in non-U.S. and domestic economic, social, and political conditions also could adversely affect individual issuers or related groups of issuers, securities markets, interest rates, credit ratings, inflation, investor sentiment, and other factors affecting the value of the investments of the portfolio and of the Trust. Any of these occurrences could disrupt the operations of the Trust and of the Trust's service providers.

NOTE 15 — LEGAL PROCEEDINGS

On May 1, 2020, Saba Capital CEF Opportunities 1 Ltd. ("Saba") filed a Verified Complaint and an Application for Preliminary Injunction in Maricopa County Superior Court, Phoenix, Arizona (the "Superior Court"), naming as defendants the Trust, Voya Investments, and the individuals serving on the Trust's Board. Saba sought a preliminary injunction and permanent equitable relief from the court, primarily in the form of an order striking certain amendments to the Trust's bylaws which related to the voting standard to be employed at Board elections, as adopted by the Board on April 13, 2020, and awarding various other forms of declaratory and unspecified monetary relief. Defendants filed a Motion to Dismiss the Verified Complaint and an Opposition to Saba's Application for Preliminary Injunction on May 20, 2020. On June 26, 2020, after a hearing, the court granted Saba's application for a preliminary injunction, ruling that the named defendants are preliminarily enjoined from applying the voting standard set forth in the April 13, 2020, bylaw amendments, and that the Trust shall conduct the Board election in accordance with the previous voting standard. On July 1, Defendants filed an emergency motion with the Superior Court asking for a stay of the preliminary injunction pending a planned appealed from the superior court's June 24 order, which the superior court denied on July 6. On July 2, Defendants filed an expedited "special action" appeal to the Arizona Court of Appeals, and sought a stay of the superior court's June 24 order in connection with that expedited appeal. On July 7, the Court of Appeals declined jurisdiction over the "special action" and denied the appellate motion to stay the preliminary injunction as moot. On July 7, Defendants filed an amended notice of appeal indicating that they would pursue a non-expedited "direct appeal" to the Arizona Court of Appeals, and sought another emergency stay of the superior court's June 24 order in connection with that ordinary-course appeal. The Court of Appeals again denied the stay request. The annual shareholder meeting proceeded, and the Board election was done in accordance with the previous voting standard. On September 30, 2020 (1) the preliminary injunction order entered on June 26, 2020 was vacated as moot, and (2) the case was dismissed with prejudice.

NOTE 16 — OTHER ACCOUNTING PRONOUNCEMENTS

The Trust has adopted the provisions of Financial Accounting Standards Board Accounting Standards Update 2018-13 ("ASU 2018-13"), Fair Value Measurement (Topic 820): Disclosure Framework — Changes to the Disclosure Requirements for Fair Value Measurement. ASU 2018-13 introduces new fair value disclosure requirements as well as provides guidance that eliminates, adds and modifies certain disclosure requirements for fair value measurements. The impact of the Trust's adoption was limited to changes in the Trust's financial statement disclosures regarding fair value, primarily those disclosures related to transfers between levels of the fair value hierarchy and disclosure of the range and weighted average used to develop significant unobservable inputs for Level 3 fair value measurements, when

Voya Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of February 28, 2021 (continued)

NOTE 16 — OTHER ACCOUNTING PRONOUNCEMENTS (continued)

applicable. Upon evaluation, the Trust has concluded that the adoption of the new accounting standard does not materially impact the financial statement amounts.

In March 2020, the Financial Accounting Standards Board issued Accounting Standards Update No. 2020-04 ("ASU 2020-04"), Reference Rate Reform (Topic 848) — Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in ASU 2020-04 provide optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of LIBOR and other interbank-offered based reference rates as of the end of 2021. ASU 2020-04 is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying ASU 2020-04.

NOTE 17 — SUBSEQUENT EVENTS

Share Repurchase Program: The Board authorized the renewal of an open-market share repurchase program pursuant to which the Trust may purchase, over the period ending March 31, 2022, up to 10% of its stock in open market transactions. The amount and timing of the repurchases will be at the discretion of the Trust's management, subject to market conditions and investment considerations. There is no assurance that the Trust will purchase shares at any particular discount level or in any particular amounts. Any repurchases made under this program would be made on a national securities exchange at the prevailing market price, subject to exchange requirements and volume, timing and other limitations under federal securities laws. The share repurchase program seeks to enhance shareholder value by purchasing shares trading at a discount from their NAV per share.

Investment Adviser and Sub-Adviser changes: Effective on or about June 22, 2021, Voya Investments will resign as the Investment Adviser and Voya IM will no longer serve as Sub-Adviser to the Trust. In making its decision to resign, Voya Investments determined that it is in the best interest of the Trust and its shareholders to provide the Board and the Trust's shareholders the opportunity to select an investment adviser that best aligns with the Board's goals and objectives for the Trust. The Board formed a special planning committee comprised of three independent trustees to conduct a search for a successor investment adviser and, at a special meeting of the Board held on March 22, 2021, the Board, including all of the non-interested Trustees, determined to select Saba Capital Management, L.P. ("Saba") as the new investment adviser to the Trust (the "Adviser Transition"). At a subsequent special meeting of the Board held on April 1, 2021, the Board considered and approved a new investment management agreement between Saba and the Trust. The Trust will seek the approval of shareholders of the new investment management agreement at a special meeting of shareholders. The Board has set a record date of March 8, 2021 for determining shareholders of record for the special shareholder meeting tentatively scheduled to be held on Friday, May 21, 2021. Shareholders will receive a proxy statement in connection with the special meeting of shareholders. In connection with the special shareholder meeting, shareholders will also be asked to approve changes to certain fundamental policies of the Trust, in order to provide the Trust with greater investment flexibility subsequent to the Adviser Transition. In addition, shareholders will also be asked to approve a change of the Trust's investment objective.

In connection with the Adviser Transition, the Board requested that the Trust begin to liquidate a portion of its portfolio to provide additional liquidity and investment flexibility subsequent to completion of the Adviser Transition. Accordingly, as of March 31, 2021, approximately $76.3 million, representing approximately 12.7% of the portfolio, was held in cash or cash equivalents, and up to 30% of the Trust's portfolio may ultimately consist of cash and cash equivalents immediately prior to completion of the Adviser Transition.

Tender Offer: Additionally, following the approval by shareholders of the new investment adviser, and as previously approved by the Trust's shareholders, the Board intends to consider a tender offer for approximately 30% of the Trust's currently outstanding shares.

Voya Prime Rate Trust

NOTES TO FINANCIAL STATEMENTS as of February 28, 2021 (continued)

NOTE 17 — SUBSEQUENT EVENTS (continued)

Subsequent to February 28, 2021, the Trust paid the following dividends from net investment income:

The Trust has evaluated events occurring after the Statement of Assets and Liabilities date through the date that the financial statements were issued ("subsequent events") to determine whether any subsequent events necessitated adjustment to or disclosure in the financial statements. Other than the above, no such subsequent events were identified.

  PORTFOLIO OF INVESTMENTS
VOYA PRIME RATE TRUST  AS OF FEBRUARY 28, 2021

  PORTFOLIO OF INVESTMENTS
VOYA PRIME RATE TRUST  AS OF FEBRUARY 28, 2021 (CONTINUED)