ECC - Earnings call transcript Q2 2022 | Eagle Point Credit Company Inc.

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Operator

Greetings, and welcome to the Eagle Point Credit Company Second Quarter 2022 Financial Results Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, [Peter Skisa] with ICR. Please go ahead, sir.

Unidentified Company Representative

Thank you, operator, and good morning. our have was our call, released also found should investor announcement which everyone be which eaglepointcreditcompany.com. presentation, prior on now, access earnings to and may By at website to this

such results we those uncertainties the discussed statements or that the that forward-looking projected may our remind forward-looking that projected information actual call matters remarks, need cause on we Before financial to to begin projected involve from everyone information. financial include in this differ materially statements formal and risks company's and

made N-CSR, Reports investor of Tom Company. link can introduce would financial of of our quarter For to unless impact and be also the be forward-looking can further based Point call the refer statements our company's the contained of Financial Executive available statements presentation Relations available like that to of of year I our any Investor Commission. we information today, replay second and during to this statements on and accessed found section the disclaim website, following our Securities XX information half information statements via Chief financial us A Officer the statement and Exchange please website. with call. and Securities investor the this the now and this factors and could obligation the statements law. forward-looking date call the herein, with The the We presentation on are company Statements projection by Majewski, company's Each filed Presentations days by and investor is link. eaglepointcreditcompany.com. Credit filings Commission. in Form Exchange quarter XXXX the second company's update and Earlier for Events within can found projections the required Financial the be by as financial presentation Eagle following to

Tom Majewski

Second Company's Point welcome, to and everyone, Peter, Quarter you, Earnings Eagle Credit Thank Call.

provides done about presentation haven't company to flows. exactly during company's our invite continued was do our and you additional did robust to supposed information already, so we The you download cash second generate It which to the quarter. portfolio portfolio. it what investor If website, our from the investment

While securities and quarter, program, tightening an during was we in many with the quantitative prices portfolio Fed's principally issue of fell market the by our the fundamentals. believe the the driven sell-off not

multiple end, far During back with while believe the occur. have to and markets And capital thrive than opportunistically August we second in quarter, from through on portfolio value, rallied quarter there investments, on roughly was our dollar which priced on the years in primary $X.XX reinvestment quarter of $X.XX all of both deployed is weighted we our the the about periods CLO left XX, we and we’ll end average saw in roughly price remaining at equity the are points Indeed, to actually volatility. loans in uncertainties secondary loans defaults period dollar. where X designed more

$X.XX $X.XX the the per $X.XX We paid was regular net quarter, and into from our income million our capital We new the during equity regular deploying portfolio investment For investments and totaled exceeding or of gains our per both stock share, flows in which CLO share, quarter. per we the million for distributions debt the portfolio share our above distributions expenses and strong cash $XX.X second markets. the common $XX.X net in managed primary and quarter. and received secondary recurring common quarter, our in realized total had -- common second during actively quarter

the This to unsecured. to fixed rising have rate is this financing a environment. has Further, maturities as us remains July $XX.XX. financing of of prior per point. share reflecting of management $XX.XX All sought sheet per uncertainty. of second quarter approximately NAV and and no estimate balance the at to that of our protects NAV market maintain long-term increase Since share, times the we a XXXX in between X% an the in our $XX.XX midpoint This give that is stability rate ended us consistently at quarter, end at we range. April of

of the prudently through share all common for premium to NAV, continue at also an a $X.XX shares approximately We and program raise X.X shareholders. generating market capital our million at accretion to issued per

tapped the C in per net to share million also company rate October. continued shares. common preferred of and per We distribution to that with little XXXX. the declarations distribution we these XX,XXX paid generated shareholders April, preferred by the distribution of approximately per recent Series $XX during some proceeds increased which will XX% we shares perpetual sales today, of $X.XX even also declared a the quarter. be share, ATM special raised Series We $X.XX Together, month D through end in over to and our issue a X,XXX common Earlier for

our As March. XX.XX%, yield average end weighted overall of of XX, largely at XXXX, unchanged of was June the from portfolio effective the the XX.XX%

attractive average put aided defaulting and levels portfolio's levels, muted ability of few weighted yield our effective by repricing. was strong to new investments Our the ground highly corporate in flows, cash loan at borrowers

net capital during million of deployed investments. into I mentioned, new the As $XX.X quarter, we

and quarter, facilities primary in into purchases X the average net effective approximately equity about accumulation We was attractive In so million month. made to XX%. we second we new July, the yield we converted capital CLOs. also find both during deployed secondary the in And the across CLO far CLO opportunities weighted continue $XX and during loan markets, XX the

XXXX, an period the years the remaining equities’ March stood second of weighted of at is years. X.X of end from our back end As X.X beginning the years This of at average XX from reinvestment X.X CLO and at quarter the XXXX. increase

our period actually of the meaningfully. reinvestment CLO passage proactive portfolio positions despite on equity So the increased through our XX months, management,

during have liability been XXX recent over or refinanced Indeed, have We other this so CLO is CLOs of calmer thriving to reset point refinancings. today off few, actively approach volatile CLOs for environments executed at more investors selloff. preparation us and any, the thoughtful handsomely. for equity many if Our CLO paying resets optimization in Many have we market times. during our believe like

As remains and would financing, we rates of a we CLO the typically company's that manage portfolio, as CLOs seek rising period the you keep reinvestment with proven as portfolio to We locked-in our also for unchanged. longer its assets playbook are of positive equity the than average possible. non-mark-to-market weighted long remind

Point of equity weighted team strong and and CLO flows, average the experienced investment confident repricings, its situated Exchange. moment deeply to company, our NII in reinvestment Eagle to low the for continued period, cycle-tested to generating portfolio highlight half symbol take believe well I which quite remaining and Company, adviser the under continue the on our of also back Our are like and sister a earnings portfolio is our lack trades New cash the potential York in company strong year of Stock would and Income defaults, beyond. with strong EIC we're ticker

distribution and month. it income net was EIC $X.XX raising monthly by $X.XX quarter, per common and XX% share, share per generated of second common week that to per last gains investment announced the its For

broader company's rising rate call even years, which CLO given is to so to learn well www.eaglepointincome.com of CLO perhaps with current junior and state more. We and in on EIC share to Ken. the website NII visit outlook at a.m. continue the XX:XX also the on the Overall, I'll its eye keep remarks remains loan equity. and to markets our than a After for of rising With for debt, corporate the months very take today financials, through I'll join increase exposure correlated heavily economy. to rates, over over watchful Ken's CLO the our invite now positioned the call coming you our to to you more environment, EIC turn remainder XXXX. portfolio we'll the at and the

Ken Onorio

Tom. Thanks,

for the which regular This company's calculated gains gains pursuant of in the the of second investment total $X.XX $XX above or in loss $XX.X The $XXX per at XXX%. the Investment debt When coverage share for second asset million These XXX%, the the company income level. million, losses common million investment ratios realized for to net of net quarter above per The comfortably unrealized of of of and by GAAP per the measures net or XX $XX and our second the offset quarter unrealized of share company included, depreciation share XXXX. income XXX% of compares loss of June of For net of XXXX, was per GAAP quarter approximately NII share realized respectively. of realized and quarter loss requirements second were compares depreciation $X.XX comprised statutory per first net preferred GAAP in $X.XX requirements are quarter and expenses a share. stock quarter million and GAAP and distribution is a is share, million. capital net second of recorded income $X.XX XXX% Act XXXX total and and quarter of to realized portfolio gains XXXX. approximately of XXXX in Company company's of $X $X.XX $XXX recorded per quarter NII million first $X.XX of second This the of net to

current less generally XX% This assets XX% quarter was liabilities. XX% slightly of end range total of the above at normal total to assets is with company's market conditions. operating of Our leverage company our leverage between approximately the under

July the the range. XX within of result returned of target leverage and valuations, higher As has as to a company's

to during $XX.X our on second compares received to portfolio reason quarter portfolio third flows investments rate XXXX. X-month recurring on July A some received floor that activity July to the $XX.X The Moving as for of to make well investment full This of million expected of million. cash the payments XX, the versus in the reminder in the the quarter company due its the through X-month are benefit of our LIBOR, amount reduced later quarter. is as loss SOFR mismatch.

of July of share $XX.XX June. July reflecting the end estimated XX as available $XX range, was increase we had of of XX, of million NAV midpoint As from per $XX.XX the investment. of cash to with Management's of for range X% approximately the company an

paid quarter, we distributions monthly per of second X common share. $X.XX the During

XXXX. of We have the of remainder for per common monthly distributions also declared share $X.XX

preliminary stockholders I aggregate year to such per maintain respect regular year. to the XXXX. call on it the ended distributions today, estimates, company Based status now special year its with tax to November our its a for exceed order to income taxable for XXXX, of to XX, back in is turn over year-end. income distribute the distribution Tom. company declared tax anticipated the its direct the tax A of paid will reminder, of $X.XX of in within payable X is addition, required all share In October effectively tax taxable to

Tom Majewski

Thank Great. you, Ken.

Let Suisse me of markets. negative the through in CLO loan the down Credit participants first return fell to Index on take our the Loan year. Leveraged of the thoughts X.XX% some a X.XX% for quarter, call second it of bringing the half and The

at to June no during X%. the through default the XX-month second only a bonds first the defaults to loans loans they've loans see discounted low We of half. something of during attractive performed of market. believe While stood those trading loans par. trailing defaults, oversold basis the second loans with XX quarter At discounts, in bonds, July Despite defaulting remains trading Corporate today's provides dollars below the at X% opportunities lows August beginning rallied consider quarter, back at of well for indeed, CLOs rated frankly, of XX, and repaid this about investment-grade both the par leading one to likes we since percent nearly or X marks all end, XX, remain very and companies XXXX. of be and loans historic our good points at at than X.X% indicator compared were And to quarter reinvest in near low loan very about which less at rate high-yield fell even XX. when down, XX%

conditions market par trading above the the is X. essentially of Given at and percentage loans

no to largest the from equity, corporate first ultimate our in NII medium again activity effective per we capital. As investments buy month XX% which We loans into movements, CLO we capital a prior financing we par opportunities faced of structure, saw and with by other recently CLO's any We for the in portfolio raised a with loan CLO basis, and second continue CLO outperform believe half refinancing And best while capital will short-term to result, issuance yields. than exceeded quarter. XXXX. April our billion is loans cost we XXXX, a value to they price are discounts help us the Point once in greater an income all We repricing CLOs market, debt had CLO we new equity by risk has and the into market valuations the end into of of the asset CLO special markets since the financing the further deploy will second in believe of of which attractive the that and term what average years CLO market as create rates we their class loss during quarter the come, for Eagle ability time. rate par and actively another of repayments over using any drive portfolio an to them, of In in declared well solid net mark-to-market paid we XX%, sum through look-through risk source -- common the locks quite is quarter. during quarter within we protects the access most The additional second looking to attractive to frankly, new activity the fixed be have done the spread that XXX% of investments across to And in per up maturities This the for distribution, loan second gone continue risk from course, us mark-to-market drawdown volatility October. about is managing of basis make has particular, and to gains of of rising seeking To our believe with It resets weighted where extended we to spreads billion a have equity environment CLO with also set underlying And the and are $X quarter points security and without of loan $XX than at increased financing the for mark-to-market the structures have drawdowns up, past. and debt realized yield distribution to get believe investment distribution year. over and of It weighted very the less of reset $X share relative rate the distributions. portfolio, saw significantly. several X. or $X.XX of slowed beginning was on regular billion a CLO common common many classes. in essentially the widening, only second refinancings our back $X.XX despite average higher

attractive our highly consistent Eagle generating we generate your robust market Our flows. respect We continue Ken same your now with portfolio for while shareholders. open Point. And to proactive this call time questions. in to thank cash as you continue to we'll I continued overall environment, remain cash navigate and and paying to the monthly investment returns our shareholders and opportunistic will seeking to interest Operator? risk-adjusted to those and distributions for portfolio

Operator

Instructions] Our [Operator with of the comes question line Mickey Ladenburg from first Thalmann. Schleien

Mickey Schleien

CLO to grade early -- thesis starting flows some months. going starting this -- bit. we're equity upward the into been a a we're your to last ratio next lot cash mind, Cushions downgrade in year? X credit to what's that OC With see in quite good cash the decline And a But climbing decline little signals starting on decline results have perspective with Tom, year. fundamentals certainly flow from the of

Tom Majewski

trigger or A there. rating right handful down C that CLO as of rates, the going other the up things impact were a flows of biggest frankly, to the downgrade a excess Sure. Well, the tests. little on things onto enough couple what a is diversion test repricings, the maybe flows of the biggest or trading X-month best the remains up downgraded. probably not frame were can going X%. could popping bit doesn't are guess, little up or of The thesis equity or low, right Unless if X movement OC To defaults OC a downgrades news information, on on is, CCCs, tremendous it that's now, rates, around those wrong very X-month things now, it, the are themselves. degree a impacts loans move can below like those downgraded, nontrivial then impact payments. that doesn't CLO SOFR in is one -- down, thesis of say loan between all basis it that meaningful I or LIBOR many below movement equity gets thing and The coupon percent direction. And migration remains of going it ratings of a be be XX is. move gets little which so cash CCCs trading XX The of best there really to and cash I a bit the needle

Ken, from should on. and collections flash the July further. the your remarks, -- our that to his on down head that in just quarter, but very good. which second expand touched hit to the spread mean in at compression defaults trading that's near also our repriced face -- in same We is in XX. did at is no good loans At medium So terms pricing I pretty that's with time, on and getting in portfolio, the essentially loans market of we on it nil term below as the remarks Ken press well, were the premiums. release basically And

-- of of Eagle What here talk deal things curve right of flows. lots a basis a XX, the in regarding offshore money. slope move remember the us with and at saw some look, now changes once most this that curve, to like is back of Treasurer are extra quarter. Once repatriation they the is all back as rate, X-month the X-month Point and that XX companies XXXX, I out them yield points. of we borrower's other XX typically the think the of rate, of were good with out we happened against can quarter, second certificate notable, LIBOR play into pay company of go during the to that in the mean, rates about X or cash months, yield but see points, and of we happen to burden their things so which CFO XX points, and few steep corporate any interesting, got before And the X to well. a X-month spread which who's loans happened, within slope versus with they was this X-month a about we X- that people though, kind for probably LIBOR which basis on And when had be the -- periodicity don't They'll compliance in is July, elect our X-month has And X SOFR. X-month so the we collections quarter. one is are, impact rates options the QX to can but proactively it Typically, X-month we filling steepness hurt choose years versus X, tax or second a the affect little SOFR law going again, the One things I little electing that. X, X, the there based is The talk third basis move where or quite we beginning -- usually bit don't in to just basically at maybe were had of already when and pay doesn't bit the be great. loan collections here, the we when at

do rate see get a typically floating little investments, from a little increase of certainly overall we So which rapid things period for rate helps these the with this while. bit of mismatch. we And Fed, our

on warnings our you caution rates. is below flags the The of the less XX% the red a X-month flags, call flags. was positive of I'd maybe quarter-over-quarter definite and market indicator. some So more than cash And to than on X% we largely basis flow hear of them loans due change between red pricing X-month

Mickey Schleien

that's same to And the the liabilities I'm Tom, that with referring mismatch. you're on Is right? CLO X-month just you The sure are priced at debt or LIBOR on make that and typically to. mismatch page SOFR,

Tom Majewski

Correct.

X-month the place So Loans for LIBOR benchmarks off or the majority which be SOFR of of certainly it the for priced are the rate, X-month is vast prime a can or equal X-month those -- but over LIBOR, pay SOFR. same those debt depending of LIBOR, deal, on moment. all CLO keep as let's CLO X-month off and LIBOR,

shorter about And that's will you X, so the at not X-month, whether mismatch. creates like XX curves, the the rate. driver companies whenever see probably curve again, or the -- that X-month biggest And elect talk about think people here, we for

Mickey Schleien

get One more to the in follow-up, weak. slowed only first to of seen going reduce has inflation way that for of would the and concern and are a Tom. imply year economy that Fed's next which pretty even the more, forecast this is all down half weakness. of year rest the lot consumer already the There's this year the We've demand

CLOs managers dealing the how to indirectly? consumer So are exposed either with how risk? And that directly are or

Tom Majewski

Yes.

So I we mean, a at the day, economy. are consumer-led of the end

Wire or of from the was cancellations, their the negotiating. who today walking crossed away they're that stats knows what the of either contract One money housing people amount earnest

direct borrowers indirect slowdown. As impacting certainly, companies of sort positioned balloon have think that in slowly correction. scale I And let of number some it's end or the the than of that, the and way rapid quite is getting large is are of markets by large handle consumer feel rates air day, the we're to seeing more the it out exposure. well a the Against vast consumer definitively up, behavior or the of our ways. majority At are going that

modest a But to it drop a the felt It trend. like least Perhaps shock. been moderate be sudden more slowdown. large, with doesn't at a sudden and it's will gradual real estate by a appear agents shock So in closings.

of things mid-XX strength companies where the to 'XX then the of the XXXX, maturities able portfolio were probably refinance to companies that of to late underlying of able their maturing up leading were out 'XX, prior the our have and such maybe period to -- strengths strength to many 'XX, we One XX% -- to of our market from the less loans about -- of XXXX.

than So companies have shape have degree and they'd balance on plenty like, than consumer ever maybe perhaps their by avoidable. leverage, that, said like. more companies always have in runway in too leverage more No a of sheets. runway. of Against more a large, more little We are cash but and with one's not with little some It's it's exposure. general, but companies better little they'd

Operator

Our of next question comes KBW. from Paul the line with Johnson

Paul Johnson

expense curious year can't the quite in have But -- fourth remember my undistributed tax the income gap reset. on tax again LIBOR estimated kind large you tax of already the what line, do your at guys amount quarter. missed on to some large year? expense. last you point expect a the this guys the drove questions for know I'm I of last from a that, but was I relatively took also exactly quarter, sort I in just undistributed income for of any Mickey's One just the answered just But questions expense

Ken Onorio

Ken. It's

XX, we'd in months So of an did undistributed our we activity incorporates our have did of of as underlying May X which which as amount suggest XX/XX. current that estimate, CLOs,

was So that an the amount. anticipatory of declared that special we today undistributed

of some of another would income, if undistributed rolling XXXX So into into is over XXXX. that also into XX. we're a our going to -- combination or of be And as refresh it December spill there special a spillover estimate

common we'll So volatility did And doing lot proactive we our there's materials, in estimate, at current of in as prior did that this XX/XX. year-end, our be is then a do to to that reflect would based distributed there's distribution the level, -- refresh noted and a take step we're the tax unknowns we reason a of and a marketplace. we out to be of under that lot morning took some determined, our on

I before So income. on just to next we want steps taxable be take cautious

Paul Johnson

just raised I'm program, your I'm some just curious, you the the as in of the -- preferred the ATM through goes, I then months. as any far terms curious access also in prior of And issuing know ATM,

of June guess, maturity market and I securities third like value? essentially yield accommodate in any quarter, sort of you we forced take volatility, market, for are issue to the discount back at of kind are times, During essentially obviously, par saw to just early to able those you purposes? and Or

Ken Onorio

Yes.

So we are able you noted. as to issue off the ATM,

are We rules. minimis de to subject

able it's when we take a but So to issue to are into marketplace, shares to par not be the discount. going discount we a significant

Paul Johnson

borrowers, the corporate they And terms just grade are and lastly, size you're what their down in down curious just with early of would just of the in a environment, sort borrowers. I'm higher seeing positions? broader question. I guess, or know just But investment average paying grade investment this environment rates a are of type typically majority at prepayment in of any of imagine, as or your hikes, that, I slow of life which prepaying borrowers essentially your more Fed with are, loans rates potentially high I going rate does and as obligors

Tom Majewski

on Sure. broadly, to question. good average, at frame per the quarter, things XX% loans In second annum. prepaid No. A really about

by that or X% take. That's give divide average. that gets quarter, just you you on per If about X,

lower. sometimes higher, it's it's Sometimes

per low was annum. quarter second at X.X% The quite

basis. calculations, not and an on take to like more the it multiply annualized just into X, -- that detail prepayments going get monthly that's times single you mortality account If you around X.X% taking of nuanced or XX% kind

very that's So slow to compared averages. long-term

we low to up -- we're scenario. and degree high this companies of Because be is a question, debt. which loans these holding are wider all great, of rate, see repricings, what but we're theoretically refis and with rate that it's These The and sometimes that. some paying any loan but strategic loan things at prices, causes the wider why this it in we I don't companies rate driving are prepayments seeing of that paying would term way the much not really love, by not mean, prepayments that the lower buying question prices, refinancings, of any not going is like. So and stretch. But often, down, are not and M&A, too we're challenged not that's There's are seeing really off? floating spread always a -- off other loans

bunch, but line to is it of the going to had principally their opinion acquisition. with of repaying market on potency $X.XX if due this we somewhere XX% But by XX% the and be if in see at context, between, remain would vast reasonable a up that part until a as we're guess, proceeds, debt large prepayment that, that gone in loans in otherwise line, is are make that's judgmental without investing great. on annual I the rate, having and loan loans rally to X.X% probably the obviously rate that basis. off strategics that And companies majority of So an dollar those the buying I'll a

Operator

B. from the Securities. Riley next Our line question of with Howlett Instructions] comes Matthew [Operator

Matthew Howlett

what maybe -- you in the look get quarter. And decline is, performance You landing in July to I rally in it you terms your technical you you equity? I and you of was have take the along? was would sort credit was maybe Would a are leverage? portfolio? or great. up question with Would you already management the you think was down the if raise position there, I of on just hard in thought curious cash, wanted August. tools to recession thought coming, defensive, -- your harder what The CLO, move the the take -- think reduce tools if which in called My thought tremendous a coming but quality Just would portfolio prices, back you

Tom Majewski

that's X economics. seek an difficult cash and then month, into the in guys, not our not conservative maximizing be the while wanted is every favorite ample term us and raised for or at equity remaining equity robust, in frankly, wouldn't And stock that. CLO of the secondary -- a It's sophisticated issuing reinvestment or more equity period single market, portfolio of or keeping the one say, style the investment I The blocks other. not Certainly, active up through that but in us and easy quality a our like billions over is the market of let's get to to that. debt to really just best of down move to anything typically would trade dollars and premium, allow do move the of and our X reinvestment riskiest tiering always that out market with guys We unfortunately, performing rid doesn't majority of medium ability CLO while it's period liquid. -- buy times

thing I'll of trends. with added as security shorter-term what But period wouldn't So managers returns of a the the we owners but debt holders the towards opinion, who move how the overall, collateral securities, with CLO perhaps or is, collateral are wouldn't less holders. will existing little and neck with has more much be which times, a choppy typically many think on holders them than we our they #X in XXX, trends certainly managers on sounds be but we reinvestment superior little do for reactionary the surface the and portfolio, statement equity that the keeping equity on repositioning you'd amazed as class, the should, exposures, there CLO are towards the of at much residual in largest delivering our basis even strong real every like the put in one every the management a to of say possible and our expectation medium-term a we to

the of them us. CLO they be thankfully, the DNA So for the a portfolio X working years. we your And number, of low kind folks were was CLO that's $X.XX when the of is period. points very the question, resources a -- everywhere which a just curated over believe of is X number suggest that group we that. fair next and for portfolio should that how certainly $X.XX suggests market if loans, to group past manage the recovery, managers to very in within better that you our our the going loans conservative choppy we do That in said, that successfully through we've you part selected defaults pricing back -- and has think use at everyone would dollar, tested started on But is believe recession of XX%

frankly, You over X sell-off lot in next fundamental. years. to rate bearish the can predicting that of And be default talk person to as not technical, XX% the was -- credit I am so unaware markets a of a the a

yes. going now, is X any that. at go up, - lower really much go we’re default to Our to than It hard lower it's go can't

below end even pickup even a assuming predicting. XX% certainly market see kind different very and But are the X% where will only at which default right still we loans of June we in, a conservative now, years, XX% rate what were market So X XX%, XX% recovery, a sure. predicting got the the for certainly at very of we next of is very, over trading is with we the than

Matthew Howlett

I'm clearly, mean I the is always mean, really And that high the take managers. market about portfolio sounds leverage put to It with advantage and of a seems be reinvestment market. the over can come most It to of cycle. just at taken back. in periods and described guys the you've it I how market. prices it Yes, -- the recessions the seems tin you most, just the put X.X% looks just And positioned oday's in I I you it like glad position that ever slide looks X% -- CS the or the the loan see resilient. industry unbelievable. of love

Tom Majewski

easy. I The XX%, Yes, That's the stuff or value the prepayments XX%. XX%, great. that's at opening really mail sir. go just mean easy. buy at I and it's mean ones buy relative selling trades, XX% par make are that good

kind partnered record of a you're trade, general, have with, gain. that of X-point the that's very good a where track on If the stuff we've that in And that's folks right delivering that. upon

of we're reasonably kind the balloon nicely, here, it view, We a been -- out like are feels hard a hard frankly. letting looking Fed of the at air landing the has recession not of

value of remind there? the be -- have our better you in in-the-money would doesn't our CLOs. the it's market it's I that down, in And weighted market, to AAA we portfolio. price ever the equity nature in CLO think up. we we frankly, we when Ken, valued, What -- me the doesn't in be in our don't fully like have debt spreads the While not spread -- Do average opinion, my is on opinion, to when our

Ken Onorio

find I'll it.

Tom Majewski

Yes, somewhere in back. the

Matthew Howlett

This the average bonds weighted you is AAA upon? spread issued the that to

Tom Majewski

through think. up in portfolio. Yes, just our here. We're the portfolio. looking some I It's pages in Further

Here we go.

see. Let's

So our it's weighted LIBOR deck. in average XX or the over XXX The is on spread SOFR. portfolio of either Page AAA

frame are between to today CLOs it, pricing and Just over. XXX XXX

just you geared. representative and roughly X but CLOs that's class, it's think So of XXx as

We have in financing price XXX levered. does not valuing or The in opinion, that, points my the give CLO market when basis XXx fully, equity. money, take, that in

-- So think we

Matthew Howlett

It's about X.X years?

Tom Majewski

another financing quarter for stays portfolio. the on in last About portfolio X years. in at reinvestment It's typically a years, our and little think, end. then place obviously, this even that still X.X after I over X period, And

consider to mean literally the liquidation the my down valued of portfolio price wider, is. as people its how the look people AAAs not XXX your money, and in make in a it debt a you the little and looking analysis just bunch work equity. on bit at use of fully at fundamental the points cheap factored is loans, to So just frankly, stack. value, It's on basis I whole way opinion, equity the when what's CLO our value you DCF a extent stuff. with the -- what's in But

Matthew Howlett

goes company, values, measure down, your and NAV, it's other I these X attributes if So hear just to the in view but you there? other correctly, up really value it mean I

Tom Majewski

what I reinvestment even our to them is long when long then of prices markets as to -- cheap be be opposite, in in runway, or we and tell our money. for yesterday's opportunity doesn't CLOs market plenty we -- of I be the our reinvestment NAV in financing. as out might would reinvesting low as you to keep ability CLOs credit to with want would a a CLOs enough our high be down, factors period, better NAVs because would the were the But possible. the our the reinvestment more would with have that as argue, If frankly, be period and give

Matthew Howlett

does second How are. I guess, mean, on the question, accumulation much And issue spreads you mean in mentioned to think? What your ball? X I you market, new just what's facility your equity half How for you -- do matter? industry, if LIBOR have year, I maybe is have year, mean, that the on. next a quick CLO the does I get last where crystal pick you it will come -- outlook it of impact if mean is I really to it all it back equity what it -- capital private does up, guess the market, slow really able it does does But the market -- in Does to primary raise. just my to ECC? big ECC matter? mean given just -- matter Does happen? is? slow how secondary this it I mean you I go shareholders stuff? buy be

Tom Majewski

things suggests bigger more The general, primary particularly. in Not that are the tightening. the market,

and an quarter. much strategy. the it's used. to a a the buy have buy all-weather little to used, was of we very it's we in new, cheaper which We can second cheaper we sometimes do case of create new When When create each,

as multi-hundred -- lot stuff proceeds a of transactions all management million positions adviser, That's in ECC. of $X.XX on Eagle million buying dollar, So secondary -- of ground inclusive the got dollars $X.XX, proceeds get but to was are dollars house, we're buy lot the a ECC bonds you of transactions these -- dollar, majority -- as to Point get of of the and hundred to $X.XX or as got that in and Eagle XXXX. in, on Point But we across when large, in our in by equity an participated a ground. several the

situation where A, over creating value a take time completed has gets off years, too. I our done last refis. believe and that, So and little any resets used, refi when used. don't like not But other XXX desk buy and create a the we're can just to so cheap now, it's better said, over bored. new to we're go we when That reset right usually there's we've to that. investor buy new, few we we fair

I AAAs done months, a in in we've anticipate XXX any don't and soon. We few again, XXX-plus market. time But got one haven't a

the out back we the at reset last in now and can spreads rip we rip tighter, next we year. or harvesting. them refi And them did out job costs those Oh, god, and that at we're and we'll point rip my few again. our cheaper our can that, look expectation in deals So done some years, the well, strong were will

a we the and is pendulum, it at side the the we of So best swing. try either when do and pendulum can is

Matthew Howlett

And as looks did to majority sheet well XX thing is with, -- the Yes. it I balance by corporate the next think, you same the

Tom Majewski

was mean done think, XXs] I -- of preferred we that a with this long Next, that's shorter rate. we too done. those that some year, perpetual maturity. [X are right a We've earlier got And got & ago, now. competitors or I execution, with the got We say. thrilled -- one fixed handle not I the a for debt maturity. our with X mean advantage issued, maybe a that's company I shall meaningful

when it but expectation. timing, intentional we part of our will, timing again, a seems issue time we good now iron’s our some bit can Rates be bit get are a debt. the again a we up and But So strike fixed skill little would that's to like rate from of little going of won't. center, that hot,

Operator

Thank you. that to turn back and Majewski any I'll session. floor the our comments. for question-and-answer gentlemen, final Mr. Ladies concludes

Tom Majewski

the for like these. in how questions very you living the I and certainly have a days and from hopefully, times, up of portfolio We're but Ken everyone appreciate much Both you interesting today. perspective interest. for Thank time we've good set Great. your

Income XX:XX to invite is you Thank also We much. Eagle the at today call, join very Point a.m. which Company you

Operator

concludes you. conference. Thank today's This

You at participation. you your Thank for time. may lines disconnect this your

Eagle Point Credit (ECC) 16 Aug 222022 Q2 Earnings call transcript