Company: ECC-PD
Filing Date: 2025-08-12
Form Type: N-CSRS
Source: 0001104659-25-076373
Chunk: 8

Company: Eagle Point Credit Co Inc.
Filing Date: 2025-08-12
Form: N-CSRS
Chunk 8
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 30, 2025, down from 27.9% at the end of 2024. With 1.7% of the loan market set to mature prior to 2027, the “maturity wall” continues 7 to be pushed out, and we do not view loan maturities as a meaningful risk. Only 1.6% of the loan portfolios underlying our CLO equity positions mature prior to 2027, pushing out the maturity wall and mitigating near-term loan maturity risk. CLO Market The CLO market saw $100 billion of new gross CLO issuance in the first half of 2025, but due to repayments at par of many CLO securities, net issuance remained much more measured at $48 billion. CLO reset and refinancing activity remained robust, driven by strong CLO debt investor demand and attractive economics, further enhancing the value of existing CLO equity investments. The first half of 2025 saw $108 billion of resets and $49 billion of refinancings. In the first half of 2025, there were $34 billion of CLO AAA paydowns, and research reports estimated another $17 billion of CLO AAA paydowns in July. We believe that, absent unexpected volatility, tightening pressure on CLO AAA spreads will likely remain and encourage more CLO reset and refinancing activity. Our CLO equity portfolio’s weighted average CLO AAA financing cost is currently 136 bps over the Secured Overnight Financing Rate (“SOFR”). The underlying fundamentals of CLO portfolios remain strong. The median market-wide CCC-rated loan exposure for US CLOs was 6.5%, with average overcollateralization cushions of 3.5% on June 30, 2025. Our Company’s portfolio compares favorably, with CCC-rated loan exposure at 4.9% and average overcollateralization cushions of 4.6%. This conservative exposure underscores our strong portfolio quality relative to market averages. We believe the CLO equity market is poised for strong returns as we move through the back half of the year. Historically, CLO equity performance trails leveraged loans which in turn trails stock performance. As previously referenced, leveraged loan prices have now mostly recovered since peak volatility earlier this year; however, CLO equity has yet to fully benefit. This suggests potential upside to CLO equity investors assuming overall market stability. Additionally, AAA CLO spreads have not fully retraced despite the recovery in underlying loans. Prior to early