ECC Stock: $0.06 Distribution, NAV $4.51, 55% Return of Capital

What ECC is, and which filings this page reads

Eagle Point Credit Company is a closed-end management investment company registered under the Investment Company Act of 1940, advised by Eagle Point Credit Management LLC in Greenwich, Connecticut. The N-CSRS says it invests “primarily in the equity and junior debt tranches of collateralized loan obligations”, and it has been adding other credit assets (infrastructure credit, portfolio debt securities, bank capital-relief trades and asset-backed securities), which were 38% of the portfolio at June 30, 2026. Its fiscal year is the calendar year. Because it is a registered fund and not a business development company (BDC), it files no Form 10-Q. The documents that carry the numbers are the annual report on Form N-CSR (filed February 26, 2026, accession 0001104659-26-019989), the semiannual report on Form N-CSRS (filed August 13, 2026, accession 0001104659-26-095330), the quarterly financial statements it files on Form N-30B-2 for March and September, the monthly 8-Ks with NAV estimates, its press releases and the Section 19(a) distribution notices on its website.

Two things to keep apart. Eagle Point Income Company (EIC) is a different fund with its own filings and is not covered here. And on May 22, 2026 ECC converted from a Delaware corporation to a Delaware statutory trust: the shares became common shares of beneficial interest, the name lost “Inc.”, and the symbols ECC, ECCC, ECC PRD, ECCU and ECCV stayed (Form 8-K, May 12, 2026). Its SEC file number and CIK did not change. For the other CLO-equity funds we cover, see Oxford Square Capital (OXSQ), a BDC, and Oxford Lane Capital (OXLC), which like ECC is a closed-end fund. For BDC dividends in general see our list of BDC stocks.

The cut: $0.14 to $0.06

On February 17, 2026, with its fourth-quarter results, the company declared $0.06 a share for each month of the second quarter. The chief executive said: “This revised distribution rate is in line with the Company’s near-term earnings potential.” The same release authorized a $100 million common share buyback. Before that the rate had been $0.14 a month since at least January 2025 (the Section 19(a) notices for every month of 2025 show $0.14), so the annual rate went from $1.68 to $0.72.

At $0.72 a year, the distribution is 19.4% of the June 30, 2026 price of $3.72 and 20.8% of the September 30 price of $3.46, and 16.0% of the June NAV of $4.51 (our arithmetic). Those ratios are only as current as the prices: later prices are not in any filing or company document we read, and a live quote can differ materially. Nothing in the filings is a forecast of the next declaration, which normally comes with the next quarterly results.

Seven quarters: NAV, NII and the payout

Each row combines the filed NAV, the NII from the statements of operations (quarterly figures are our subtraction of the cumulative statements), the per-share NII from the company's quarterly press releases, and the distributions.

Four readings. First, coverage was between 47.6% and 66.7% in the five quarters from March 2025 to March 2026 at $0.42, and the cut to $0.18 a quarter is what moved it to 94.4% in June 2026, not a rise in earnings: NII fell from $32.3 million in the March 2025 quarter to $21.9 million in June 2026, down 32.2% (our arithmetic), as total investment income fell from $52.3 million to $37.9 million (down 27.6%) and the investment portfolio at fair value shrank 28.3% from December 2024 to June 2026 (our arithmetic). Second, NII is struck before the perpetual preferred distributions. The press releases put them at $0.04 a share in the December 2025 quarter and $0.05 in the June 2026 quarter, so what is left for common in June is about $0.12 against $0.18, 66.7% (our arithmetic). Third, the September estimate is a different measure, NII less net realized losses, and the company says the $0.27 to $0.31 is “exceeding the Company’s common stock distributions and total expenses for the quarter”; it adds that the excess is “principally attributable to the broader Eagle Point platform”, meaning investments outside CLO equity. It is an unaudited range until the quarter is reported. Fourth, the company's own cash measure is larger: “recurring cash distributions” from investments were $62.4 million in the June 2026 quarter and $124 million in the half, $0.94 a share. That figure includes principal returned by CLO equity positions, and the filings do not split it into income and principal, so the accounting view (NII) and the cash view bracket the payout.

The same comparison in dollars, from the statements of changes in net assets, shows how long this has run:

Common distributions exceeded NII after preferred distributions by $268.3 million over the 3.5 years (our arithmetic). Over the same period the fund raised $652.9 million net by selling common shares and $66.0 million through its dividend reinvestment plan, and recorded $238.9 million of realized losses on investments.

Return of capital: what the notices said and what the 1099 said

Section 19(a) of the Investment Company Act requires a fund to tell holders the source of each distribution, and ECC posts a notice for each payment on its website. Each one carries a warning: “The amounts and sources of distributions reported in this notice are only estimates and are not being provided for U.S. tax reporting purposes.” The 2025 notices bear that out. They showed 100% net investment income through the July payment, then a growing return of capital, and the annual report, which quotes the final Form 1099-DIV, put the year at 54.99%.

The gap is $0.66 a share (our arithmetic: $0.92 less $0.26). The full-year 2025 statement of changes in net assets shows $115.3 million of common distributions classified as return of capital out of $209.7 million; the half-year report for June 30, 2025 showed none of the $100.4 million as return of capital. The same is true now: the June 30, 2026 report shows $79.3 million, all “earnings”, and no return of capital, which in the 2025 pattern says little about the final figure. The notices explain the mechanism: a portion is estimated to be a return of capital when the fund “has distributed an amount in excess of income and capital gains”, which is a tax measurement made at year end, and the company adds that a return of capital “does not necessarily reflect the Company’s investment performance”. The final character of the 2026 distributions will be on the Form 1099-DIV sent after the end of 2026.

Eleven years of final characterization, from the company's tax page (the 2024 figure differs by source; see below the table):

For 2024 the company's own documents disagree: the tax page shows 5.90% return of capital, and the N-CSR says “5.33% (or $0.10 per share of common stock)”. We use the N-CSR figure when we cite 2024 in the text. For the cost-basis effect, the company publishes a Form 8937 for 2025 with the split by payment date; our guide to return of capital on REIT and fund distributions and the 1099-DIV timeline explain how it flows to a tax return.

NAV from $8.38 to $4.51, and the price behind it

The financial highlights carry the per-share history. The price-to-NAV column is our arithmetic.

Two things stand out. From 2017 to 2022 NII per share never fell below $1.15 and the stock was at or above NAV at five of six year-ends; from 2022 to 2025 NII per share fell from $1.53 to $0.98 while the share count went from 55.0 million to 131.8 million. And the NAV fell from $17.48 at the start of 2017 to $4.51, down 74.2% (our arithmetic). Here is where the 2024 to June 2026 NAV went, per share, from the same highlights (sums are our arithmetic):

In 2024, issuing shares above NAV added $0.30 to NAV per share. In 2025 it added $0.04, and in the first half of 2026 nothing, because there were no sales. In the first quarter of 2026 NAV fell from $5.70 to $4.17, which the company attributes to the “potential impact of artificial intelligence on software borrowers, together with geopolitical developments”; in the second quarter it rose to $4.51 as “loan prices and CLO equity valuations recovered meaningfully”. Technology: Software and Services is the largest industry in the look-through portfolio, 10.4% of underlying loans at June 30, 2026. The monthly estimates since then are $4.33 to $4.43 for July, $4.29 to $4.39 for August and $4.12 to $4.22 for September (8-Ks), a drop of 7.5% from June at the midpoint (our arithmetic). The company's September monthly update gives the price at $3.46, the discount at 17.03% and the year-to-date total return at -27.45%, against -6.41% for the S&P BDC Index and +3.42% for the S&P UBS Leveraged Loan Index.

CLO equity: 167 lines, marks at 67% of cost, 28 at a zero yield

The schedule of investments lists every CLO equity position with its cost, fair value and effective yield. Adding the lines up gives totals that tie to the filings (191 lines at December 31, 2025 and 167 at June 30, 2026). The marks have moved like this:

Fair value is down 47.3% since December 2024 and cost 31.0% (our arithmetic): the fund has both written the positions down and sold or lost some of them, with $111.9 million of net realized losses on investments in the first half of 2026. The shareholder letter says it rotated away from “underperforming CLO collateral managers” and that those realized losses “had largely been reflected in the unrealized losses from prior periods, resulting in a minimal impact on the Company’s NAV during the current period”. What the lines show, grouped by the status the schedule gives them (our counts):

The schedule footnote for the 28 lines reads: “Future recurring distributions, once received, will be recognized solely as return of capital until the aggregate projected amount of future recurring distributions and terminal principal payment exceeds the amortized investment cost.” In other words, cash from those lines is not income. The lines with a positive yield are carried at 71.3% of cost, the zero-yield group at 32.2% (our arithmetic). The company reports a weighted average effective yield on CLO equity at amortized cost, excluding called CLOs, of 14.6% at December 31, 2024, 11.7% at December 31, 2025 and 9.0% at June 30, 2026, and a weighted average expected yield on fair value of 24.2%. The two are different yardsticks: the first is what the cost earns, the second is what the current mark is expected to earn. Concentration is moderate: the ten largest lines are 22.7% of CLO equity fair value (our arithmetic) and the largest, Clonkeen Park CLO DAC, is $17.7 million, 3.0%. Look-through, the fund has indirect exposure to 1,838 corporate obligors, the largest 0.62% and the top ten 4.69%, with a junior overcollateralization cushion of 4.43% and a weighted average remaining reinvestment period of 3.4 years.

Two more points on what the fund holds. First, $856.7 million of the $1,005.4 million of investments at fair value, 85.2% (our arithmetic), are Level III, valued with the adviser's own inputs. Second, the mix is changing: of $211 million deployed in the first half of 2026, $149 million went into credit assets other than CLOs (our arithmetic: 70.6%), with a stated weighted average effective yield of 23.4% at purchase, and $35 million into CLO equity at 22.2%. The non-CLO share of the portfolio was 38% at June 30, 2026 (infrastructure credit 11%, bank capital-relief trades 10%, portfolio debt securities 9%, asset-backed securities 6%, strategic credit 2%). The chief executive said on February 17 that “we expect the portion of our portfolio invested in other credit asset classes to increase”, which means NAV will depend more on private-credit marks and less on CLO equity prices. For another view of the same holdings, our page on private credit ETF holdings lists ECC among the positions of the VPC fund.

Leverage: $512 million of notes and preferred ahead of the common

The N-CSRS puts it in one sentence: “Our leverage was 47.3% of total assets (less current liabilities), which was above management’s long-term target leverage range of 27.5% to 37.5%”. At December 31, 2025 it was 47.6%. The company says it “intends to return leverage to within its target range over time”. The financing at June 30, 2026:

At the stated rates that is about $34.7 million a year before any fee (our arithmetic), which matches the company's 6.8%. All of it is fixed rate, and there is no financing maturing before January 2029. The asset coverage figures in the financial highlights are 212% for the preferred shares and 520% for the debt securities. Net assets applicable to common shares were $599.5 million, so the layers ahead of them equal 85.4% of that figure (our arithmetic). Two points matter to a common holder. The Series AA and AB shares can be converted by their holders into common shares at any time (a conversion fee of 0% to 8% applies to Series AA), and after two years the company can convert them to common at a five-day average price or redeem them in cash: 470,603 common shares were issued from conversions in the first half of 2026. And the company has been reducing debt: it redeemed the 8.00% Series F Term Preferred ($62.2 million) on January 30, 2026 and, on May 8, 2026, the 6.75% notes due 2031 ($37.7 million) and the 6.6875% notes due 2028 ($31.7 million). The principal of unsecured notes went from $279.9 million at the end of 2025 to $208.3 million at June 30, 2026. It also bought back $5.0 million of Series C at about 2.1% under par in the half, and $0.4 million more in July.

Selling shares above NAV, and a buyback that has not been used

ECC funds growth through an at-the-market (ATM) program on its common shares. All figures below are from the statements of changes in net assets; the per-share price is our arithmetic.

Shares outstanding went from 55.0 million at the end of 2022 to 133.0 million at June 30, 2026, up 141.6% (our arithmetic), including 1.75 million, 2.30 million, 3.39 million and 0.73 million shares issued through the dividend reinvestment plan in 2023, 2024, 2025 and the first half of 2026. The sales stopped as the stock fell toward NAV. On February 17, 2026 the board authorized the repurchase of up to $100 million of common shares over one year; the N-CSRS says “No repurchases have been made for the six months ended June 30, 2026”, and the program “does not require” any purchase. The company spent its cash on preferred shares and notes instead. The conversion to a statutory trust on May 22, 2026 also brought the Delaware control share statute, which limits voting rights on shares acquired above set thresholds unless two-thirds of disinterested shares approve (prospectus supplement, May 22, 2026).

What the adviser is paid

The management fee is 1.75% a year of the “total equity base”, which includes the paid-in capital of the preferred shares, so it is charged on assets bought with the preferred. The incentive fee is paid quarterly on pre-incentive fee net investment income (PNII) above a hurdle of 2.00% of net assets a quarter (8.00% annualized), with a catch-up to 2.50% and 20% above that; the filing states that “PNII excludes any realized or unrealized capital gains or losses”. In dollars:

In the first half of 2026 NAV per share fell 20.9% (our arithmetic: $5.70 to $4.51) while $8.9 million of incentive fee was incurred. That is how the formula is written: the incentive fee looks at income and not at capital losses. An incentive fee of $9.2 million was payable at June 30, 2026.

What happened recently, in dates

• January 12, 2026: 8-K with the December 31, 2025 NAV estimate of $5.65 to $5.75 and fourth-quarter NII of $0.22 to $0.26 a share.
• January 30, 2026: Series F preferred redeemed ($62.2 million); the January distribution paid at $0.14.
• February 17, 2026: fourth-quarter results, $0.06 declared for April to June and $100 million buyback authorized.
• March 12, 2026: stockholders approved the conversion to a statutory trust at a special meeting.
• April 14, 2026: 8-K estimates a March 31 NAV of $4.12 to $4.22 and NII of $0.18 to $0.22; the May 19 results put them at $4.17 and $0.20, with a GAAP net loss of $148.4 million.
• May 8, 2026: 2028 and 2031 notes redeemed ($69.4 million).
• May 22, 2026: conversion to a Delaware statutory trust effective.
• August 13, 2026: second-quarter results and Form N-CSRS: NAV $4.51, GAAP net income of $70.0 million, $0.06 declared for October to December.
• October 14, 2026: 8-K with the September 30 estimates: NAV $4.12 to $4.22.
• Next: payment of the $0.06 on October 30 (record date October 13), then the October NAV estimate (the monthly 8-Ks have come within about two weeks of month end) and the September quarter statements.

When the next report arrives

As of October 19, 2026 the report for the quarter ended September 30, 2026 is not filed; the latest filed period is June 30, 2026 (Form N-CSRS, August 13, 2026). The quarterly financial statements for September went on file on November 13, 2025, November 14, 2024 and November 14, 2023 (Form N-30B-2), so mid-November 2026 is the pattern; the company has not announced a date in any filing we read. That report will give the final NAV for September 30, 2026, NII and realized results per share, the CLO equity schedule, the share count and the leverage ratio.

What a holder or reader can do with this

This is a checklist built from the filings, not a recommendation.

• Read three numbers together each quarter. NII per share after the perpetual preferred distributions, the distribution ($0.18 a quarter now), and the change in NAV. The June 2026 quarter was $0.12 against $0.18 on the first measure; the September estimate is not yet on the same basis.
• Treat the Section 19(a) notice as an estimate. In 2025 it said 15.48% return of capital in December and the 1099-DIV said 54.99%. The final split affects your cost basis; the company's Form 8937 gives it by payment date.
• Watch the marks. The CLO equity fair value to cost ratio (67.4% in June), the count of lines with a zero yield (28), and the weighted average effective yield (9.0%).
• Watch leverage against the 27.5% to 37.5% target. The next call date on the preferred is November 29, 2026 for Series D.
• Check whether the buyback is used, and whether the ATM resumes if the stock trades above NAV again.
• Taxes. The tax character of 2026 distributions is set after year end; see our 1099-DIV timeline and the guide to reporting sales on Form 8949.

FAQ

All figures are from Eagle Point Credit Company's SEC filings (CIK 1604174) and company documents read on October 19, 2026: the Forms N-CSR for 2025 and 2024 (accessions 0001104659-26-019989 and 0001104659-25-015404); the Forms N-CSRS for June 30, 2026 and June 30, 2025 (0001104659-26-095330 and 0001104659-25-076373); the Forms N-30B-2 for March 31, 2026, September 30, 2025 and March 31, 2025 (0001104659-26-063409, -25-110818 and -25-053244); the Forms 8-K of January 10, 2025 to October 14, 2026 with the NAV estimates (including 0001104659-26-115755, -26-059400, -26-043312 and -26-002934); the Form N-23C-2 of April 6, 2026 (0001104659-26-039942); the prospectus supplement of May 22, 2026 (0001104659-26-065768); the press releases of May 28, August 12 and November 13, 2025 and February 17, May 12, May 19, August 13 and October 14, 2026; the September 2026 monthly portfolio update; the Section 19(a) notices for December 2024 to December 2025; Form 8937; and the company's tax characteristics page, all on eaglepointcreditcompany.com. Ratios, coverage percentages, sums across periods and the grouping of the 167 and 191 CLO equity lines are our arithmetic; the company's own measures are labeled as such. The quarterly NII for 2024 and 2025 is our subtraction of cumulative statements. This is analysis of public documents, not investment, legal or tax advice.