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Eagle Point Credit Management has announced financial results for its Eagle Point Institutional Income Fund for the initial operational period from June 1, 2022, to December 31, 2022. The Fund's net asset value per share decreased slightly to $9.97 as of December 31, 2022, from $10.00 on June 1, 2022, but it paid total distributions of $0.455 per share for 2022. In 2023, the Fund has already paid an additional $0.152 per share, equating to an 8.5% annualized distribution rate. The Fund primarily invests in senior secured loans, aiming for stable income for investors despite a volatile macroeconomic environment.
Positive
8.5% annualized distribution rate in 2023.
Net investment income coverage of distributions was 111% in 2022.
Net asset value increased to $10.22 as of January 31, 2023.
Negative
Net asset value per share decreased from $10.00 to $9.97 during the initial operational period.
GREENWICH, Conn.--(BUSINESS WIRE)--
Eagle Point Credit Management LLC (“Eagle Point”), a specialist credit asset manager with approximately $7.5 billion of assets under management,1 announced that Eagle Point Institutional Income Fund (the “Fund”), a non-traded closed-end fund registered under the Investment Company Act of 1940, reported financial results for its initial period of operations, from June 1, 2022 to December 31, 2022. The Fund’s net asset value per share as of December 31, 2022 was $9.97, compared to $10.00 per share on June 1, 2022. The Fund also paid $0.455 per share of total distributions to shareholders in 2022.
The Fund subsequently paid $0.152 per share of additional distributions to shareholders in 2023 (January and February 2023 distribution payments), representing an 8.5% annualized distribution rate.2 The February distribution represents the Fund’s eighth consecutive monthly distribution since commencing operations. The Fund’s net asset value per share as of January 31, 2023 was $10.22.
Eagle Point Institutional Income Fund seeks to provide investors with an attractive income stream by investing primarily in diversified pools of senior secured loans called collateralized loan obligations (“CLOs”). Senior secured loans held by CLOs are typically floating rate loans to U.S. companies with a first lien position in the capital structure. Through its investments in equity and junior debt securities of CLOs, the Fund seeks to provide diversified exposure to U.S. companies across various industries.
Thomas Majewski, the Fund’s Chief Executive Officer, said, “We are pleased with the results of Eagle Point Institutional Income Fund in 2022. During a particularly volatile and challenging macroeconomic environment, we have been able to preserve capital and pay an attractive distribution to investors. Notably, our net investment income coverage of distributions declared and paid in 2022 was 111%. We believe the Fund is well positioned to continue achieving our investment objectives.”
The Fund seeks to leverage Eagle Point’s established institutional investment management business to deliver attractive risk-adjusted returns for the Fund’s investors over the long-term. The Fund’s investments in CLO securities, which typically pay a floating rate of interest, are expected to be more resilient than fixed rate credit investments in a rising interest rate and inflationary environment. The Fund currently offers its shares on a continuous basis in monthly closings.
Please refer to the Fund’s annual report available at www.EPIIF.com for additional information on the Fund’s financial results for the period ended December 31, 2022.
About Eagle Point Credit Management LLC
Eagle Point is a specialist asset manager focused on income-oriented credit investments including CLO securities, senior secured loans and Portfolio Debt Securities. Eagle Point and its affiliates manages approximately $7.5 billion of assets under management.1 The senior investment team is comprised of CLO industry specialists who have been in the market for the majority of their careers and who have established relationships with key market participants. Eagle Point was formed in 2012 by Thomas Majewski and Stone Point Capital.
Forward-Looking Statements
This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described in the Fund’s filings with the U.S. Securities and Exchange Commission (“SEC”). The Fund undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.
Securities Disclosure
This press release is provided for informational purposes only, does not constitute an offer to sell securities of the Fund and is not a prospectus. Such offering is only made by the Fund’s prospectus, which includes details as to the Fund’s offering and other material information. Securities offered through WealthForge Securities, LLC, member FINRA and SIPC. WealthForge Securities, LLC and Eagle Point are not affiliated. Investing in the Fund involves risk of loss of some or all principal invested. Speak to your tax professional prior to investing. This is neither an offer to sell nor a solicitation to purchase any security. Please refer to the prospectus available at www.EPIIF.com for additional information about the Fund. The prospectus should be read carefully before investing.
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1 As of December 31, 2022. Calculated in the aggregate with its affiliate Eagle Point Income Management LLC and includes capital commitments that were undrawn.
2 “Annualized Distribution Rate” reflects the February 2023 declared distribution of $0.077 per share multiplied by twelve and divided by the January 31, 2023 public offering price (assuming maximum sales load of 6%) of $10.87. The timing and frequency of distribution payments is not guaranteed. Distributions may be comprised of any combination of 1) net investment income and/or 2) net capital gain. If the Fund distributes an amount in excess of net investment income and net capital gains, a portion of such distribution will constitute a return of capital. A distribution comprised in whole or in part by a return of capital does not necessarily reflect the Fund’s investment performance and should not be confused with “yield” or “income.” A return of capital distribution may reduce the amount of investable funds. The actual components of the Fund’s distributions for U.S. tax reporting purposes can only be finally determined as of the end of each fiscal year of the Fund and are thereafter reported to shareholders on Form 1099-DIV. In considering returns, investors should bear in mind that historical performance is not a guarantee, projection or prediction and is not indicative of future results. Investment return and principal value of any investment will fluctuate and may be worth more or less than the amount initially invested.
