Virtus Convertible & Income Fund II Postpones Monthly Distribution on Common Shares

Rhea-AI Summary

Virtus Convertible & Income Fund II (NCZ) has postponed its monthly distribution of $0.0375 per share originally set for July 1, 2022, due to a decline in the values of its portfolio securities. The Fund's asset coverage ratio fell below the 200% minimum required for declaring or paying monthly dividends, as of June 30, 2022. Distributions will resume once compliance with this ratio is achieved. The Fund aims to provide total return through capital appreciation and high current income.

Positive

• Intends to resume monthly distributions once asset coverage ratio is compliant.

Negative

• Postponement of distribution raises concerns about the Fund's financial stability.
• Asset coverage ratio fell below the 200% minimum guideline, affecting distribution capability.

HARTFORD, Conn., July 1, 2022 /PRNewswire/ -- Virtus Convertible & Income Fund II (NYSE: NCZ), a closed-end fund, today announced that it has postponed payment of its monthly distribution of $0.0375 per share that was scheduled to be paid on July 1 and has postponed declaration of its monthly distribution of $0.0375 per share that was scheduled to be declared on July 1 for payment on August 1.

Recent market dislocations have caused the values of the Fund's portfolio securities to decline and, as a result, the Fund's asset coverage ratio for total leverage as of June 30, as calculated in accordance with the Investment Company Act of 1940, was below the 200% minimum asset coverage guideline. Compliance with the asset coverage ratio is required by the Fund's governing documents for declaration or payment of the monthly dividends. As a result, the Fund is not authorized to declare or pay its monthly distributions until the coverage ratio is in compliance. The Fund intends to resume declaration and payment of its monthly distributions once its coverage ratio is in compliance.

About the Fund
Virtus Convertible & Income Fund II has an investment objective to provide total return through a combination of capital appreciation and high current income. Virtus Investment Advisers, Inc. is the investment adviser of the fund and Allianz Global Investors manages the fund in a subadvisory capacity. For more information, contact shareholder services at 866-270-7788, by email at closedendfunds@virtus.com, or through the closed-end fund section of www.virtus.com.

Fund Risks
An investment in a fund is subject to risk, including the risk of possible loss of principal. A fund's shares may be worth less upon their sale than what an investor paid for them. Shares of closed-end funds may trade at a premium or discount to their net asset value. For more information about each fund's investment objective and risks, please see the fund's annual report. A copy of the fund's most recent annual report may be obtained free of charge by contacting "Shareholder Services" as set forth at the end of this press release.

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SOURCE Virtus Convertible & Income Fund II

FAQ

Why did Virtus Convertible & Income Fund II postpone its monthly distribution on July 1, 2022?

The Fund postponed its distribution due to a decline in portfolio values, causing its asset coverage ratio to fall below the required 200% minimum.

When is Virtus Convertible & Income Fund II expected to resume its monthly distributions?

The Fund plans to resume distributions once its asset coverage ratio is back in compliance.

What is the distribution amount for Virtus Convertible & Income Fund II?

The monthly distribution amount for Virtus Convertible & Income Fund II is $0.0375 per share.

What does the asset coverage ratio mean for Virtus Convertible & Income Fund II?

The asset coverage ratio measures the Fund's ability to cover its leverage; it must meet a minimum of 200% to declare or pay distributions.