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Eagle Point Credit Company Inc. (NYSE:ECC)
Q3 2020 Earnings Call
Nov 17, 2020, 10:00 a.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Operator

Greetings, and welcome to Eagle Point Credit Company's Third Quarter 2020 Financial Results Conference Call. [Operator Instructions] A question-and-answer session will follow the formal presentation. [Operator Instructions] I would now like to turn the conference over to your host, Garrett Edson of ICR. Thank you. You may begin.

Garrett Edson -- Managing Director of ICR Inc.

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

Before we begin our formal remarks, we need to remind everyone that the matters discussed in this call include forward-looking statements or projected financial information that involve risks and uncertainties that may cause the company's actual results to differ materially from those projected in such forward-looking statements and projected financial information. For further information on factors that could impact the company and the statements and projections contained herein, please refer to the company's filings with Securities and Exchange Commission. Each forward-looking statement and projection of financial information made during this call is based on information available to us as of the date of this call. We disclaim any obligation to update our forward-looking statements unless required by law.

A replay of this call can be accessed for 30 days via the company's website eaglepointcreditcompany.com. Earlier today, we filed our third quarter 2020 financial statements and our third quarter investor presentation with the Securities and Exchange Commission. The financial statements and our third quarter investor presentation are also available within the Investor Relations section of the company's website. The financial statements can be found by following the Financial Statements and Reports link, and the investor presentation can be found by following the Presentations and Events link.

I would now like to introduce Tom Majewski, Chief Executive Officer of Eagle Point Credit Company.

Thomas P. Majewski -- Chief Executive Officer

Thank you, Garrett. And welcome everyone to Eagle Point Credit Company's third quarter earnings call. If you haven't done so already, we invite you to download our investor presentation from our website, which provides additional information about the company, including information about our portfolio and the underlying corporate loan obligors. For today's call, I'll provide some high level commentary on the third quarter and more recent events, then I'll turn the call over to Ken who will walk us through the third quarter financials. I'll then return to talk about the macro environment, our strategy and provide updates on some recent activity. We will also open the call to your questions.

During the third quarter, the US economy continued its gradual recovery as many shutdown orders were relaxed and governments globally provided liquidity to the market. Worst-case scenarios for corporate credit that some predicted back in March have not materialized. Today, many research desks are actually reducing their near-term default projections. With that said, we were very mindful that we're not out of the woods just yet with respect to COVID as cases have been rising.

Given our strong balance sheet and ample liquidity, we've been able to find attractive CLO opportunities both in the secondary and primary markets. During the third quarter, we deployed a little over $27 million of net capital into new investments. We also converted three of our existing loan accumulation facilities into new CLOs. During the third quarter, the company received recurring cash flows from our portfolio of $16.7 million or about $0.53 per weighted average common share. Our net investment income was $0.29 per common share in the third quarter, well above our common distribution level. We did realize some losses selling a few investments and that brought our NII, net of realized losses to $0.23 per common share.

Net of distributions paid to common stockholders, our NAV increased by 13% during the quarter. While we're certainly pleased with the upward NAV movement, we're mindful that it still has lagged other risk assets as CLO equity often does. Our NAV remains below where it started the year and we believe there may be potential for continued upside in our NAV.

Looking to October, we see some even better news. We received recurring cash flows from our portfolio of $25.5 million during the month of October. This is an increase of 50% over the prior quarter. Cash flows were pressured in the third quarter due to an adverse LIBOR mismatch when many CLO rates were set back in April of this year. That has corrected itself and now CLOs are benefiting from a positive LIBOR basis driven by 1% floors, which are becoming increasingly common on many loans today. We expect this positive basis to continue as long as LIBOR remains low, and that will benefit CLO equity.

In addition, several investments in our portfolio that deferred payments in July resume making distributions in October as they came on size with their OC tests. Beyond the positive trends in our cash flows and earnings, we remain -- we continue to maintain a very solid balance sheet, we have no financing maturities due before October of 2026, we have no secured financing whatsoever, no repo style financing and no unfunded revolver commitments. So while we are optimistic that the economy will continue to rebound, we remain very well positioned we believe to weather setbacks should they occur. We have ample dry powder, a little over $12 million as of October 31, allowing us to continue to be on the offense when we see opportunities. We also declared common distributions of $0.08 per share per month for the first third months of 2021 keeping with the rate that we've been paying over the past few quarters.

Earlier, I talked about positioning the company's balance sheet. I also want to highlight the value of the right side of our CLO equity portfolio's balance sheet. We continue to believe our portfolio could withstand a prolonged recession, should it occur and we believe it could thrive in it. This is not because we're blind to defaults, but because of the value that can be created by reinvesting within our CLO structures. A key metric to evaluate our reinvestment optionality is how much reinvestment period we have left in our portfolio. At quarter-end, our CLO equities portfolio's weighted average remaining reinvestment period stood at 2.6 years. This allows our CLOs to continue to be on the offense in volatile markets. This measure was 2.7 years at the end of June and 2.9 years at the beginning of 2020. So despite the passage of nine months through our proactive management of our portfolio, our portfolio's remaining reinvestment period decayed by less than half.

After Ken's remarks, I'll take you through the current state of the corporate loan and CLO markets and share our outlook for the remainder of 2020. I'll now turn the call over to Ken.

Kenneth Onorio -- Chief Financial Officer and Chief Operating Officer

Thanks, Tom. Let's discuss the third quarter in a bit more detail. For the third quarter of 2020, the company recorded net investment income, net of realized losses, of approximately $7.2 million or $0.23 per common share. This compares to net investment income, net of realized losses, of $0.28 per common share in the second quarter of 2020 and net investment income plus realized gains of $0.37 per common share in the third quarter of 2019. When unrealized portfolio appreciation is included for the third quarter, the company recorded GAAP net income of approximately $44.5 million or $1.40 per common share. This compares to GAAP net income of $1.71 per common share in the second quarter of 2020 and a GAAP net loss of $1.59 per common share in the third quarter of 2019.

Just a reminder, our short-term cash flow generation is largely unaffected by the unrealized appreciation or depreciation we recorded at the end of each quarter. The company's third quarter GAAP net income was comprised of total investment income of $16 million and net unrealized mark-to-market gains of $37.3 million, partially offset by expenses of $7 million and realized losses of $1.8 million. As of October 31, the company had $12.9 million of cash on hand, net of pending settlements. As of September 30, the company's net asset value was approximately $268 million or $8.45 per common share. Management's unaudited estimate of the range of the company's NAV as of October 31 was between $8.53 and $8.63 per share.

The company's asset coverage ratios at September 30 for preferred stock and debt calculated pursuant to Investment Company Act requirements were 288% and 433% respectively. The current measures are comfortably above their statutory requirements of 200% and 300%. As of September 30, the company had debt and preferred securities outstanding totaling approximately 34.7% of the company's total assets less current liabilities, which is within, but at the upper end of our range of generally operating the company with leverage between 25% to 35% of total assets under normal market conditions.

Moving onto our portfolio activity in the fourth quarter. Through October 31, the company received current cash flows on its investment portfolio of $25.5 million or $0.80 per common share. To highlight Tom's earlier point, this is a 50% increase compared to the $16.7 million or $0.53 per common share received during the full third quarter. Consistent with prior periods, please note some of our investments are expected to make payments later in the quarter. During the third quarter, we paid three monthly distributions of $0.08 per share of common stock on our paying the same amount for each month in the fourth quarter. Additionally, this past Friday, we declared common distributions for the first three months of 2021 in the same amount.

In terms of our at-the-market offering program in the third quarter, the company issued approximately 82,000 shares of its common stock at a premium to NAV for total net proceeds to the company of approximately $0.6 million.

I will now hand the call back over to Tom.

Thomas P. Majewski -- Chief Executive Officer

Great. Thanks, Ken. Let me take you through where the macro loan and CLO markets currently stands, then I'll touch on our recent portfolio activity as well. The Credit Suisse Leveraged Loan Index continued to see a nice recovery generating a total return of nearly 4% for the third quarter of 2020. As of September 30, the CS Leveraged Loan Index was down less than 1% and as of November 13, the Index had actually reached positive territory for the year. This is remarkable in our opinion when one considers how dire the outlook was for credit back in March. According to S&P, 13% of the loan market was trading below 90% [Phonetic] at the end of September, and that compares to 22% at the end of June. This is a very big improvement, and we're happy to see it.

Despite the improvement in the loan market, we believe opportunities continue to exist for our CLOs to reinvest and build par through buying loans at discounted prices. Our CLO equity investments should be well positioned to continue to reinvesting given the benefit of the long-term locked in place non-mark-to-market financing inherent in our CLO structures. Retail fund -- loan fund outflows lightened a bit, but still persisted in the third quarter, and we saw outflows of a little over $4 billion. On a look through basis, the weighted average spread in our portfolio increased slightly from 3.55% in June to 3.59% at the end of September. An increasing number of loans in the market now include LIBOR floors, which further increased our interest collection when short-term rates are as low as they are at present. Simply, we're earning floored LIBOR and we're typically paying LIBOR that is not floored or subject to a floor of zero. That's very, very powerful.

The trailing 12-month default rate at the end of September stood at 4.17% according to S&P. While we still expect additional defaults in the coming months, the rapid recovery in the market is causing many research desks to reduce their projections of default rates, and this is a very hopeful sign compared to where things stood six to eight months ago. While defaults will likely to continue -- will likely continue at elevated levels in the short term, we believe the corporate default rate will remain lower than it otherwise would have been had more loans featured financial maintenance covenants.

The company's default exposure as of September 30 stood at 2.03%, well below the trailing 12-month default rate. Further only 5.4% of loans in our portfolio mature prior to 2023 providing a significant majority of our corporate borrowers with years and years of runway before their deaths are actually due. Our portfolio's weighted average junior OC cushion was 1.12% as of September 30, and that's up from 0.83% or 83 basis points at the end of June. That's a big improvement, but is still where -- it was still below where it stood prior to the COVID onset. This principally reflects the impact of 40% of all corporate loans being downgraded by the rating agencies. However, as previously mentioned, the pace of downgrades has slowed. And we've actually started to see some upgrades of stronger issuers. In addition, many of our largest holdings have significantly greater OC cushion than the average.

By market value, 95% of our CLO equity positions that were scheduled to make payments in October did so. Think about that for a minute, eight months after one of the largest crisis we've seen in several years, 95% of CLO equity in our portfolio is paying current distributions. It's the primary reason why CLOs are such an attractive and resilient asset class and what attracts us to invest the company's capital and our own personal capital in the stock of the company.

To sum up, cash flows on our portfolio increased by 50% in October versus the third quarter. Our balance sheet remains strong, and we have no debt maturities for nearly six years. We have $12.9 million of dry powder ready to invest. The long-term locked in place non-mark-to-market financing in our CLOs is significant and we consider to be generally under-appreciated advantage of CLO equity. And we believe our advisor's deep expertise and strong track record are keys to our success, particularly during uncertain times. We continue to closely manage our investment portfolio and remain opportunistic with respect to deploying capital. As a reminder, we know how CLOs have performed historically. Many consider 2006 and '07 CLOs to be some of the best vintages of the 1.0 era. If today's CLOs perform half as well as the 1.0 set did, we believe that this will be a very attractive ultimate outcome for investors.

With that, we thank you for your time and interest in Eagle Point. Ken and I will now open the call to your questions.

Questions and Answers:

Operator

Thank you. At this time, we'll be conducting a question-and-answer session. [Operator Instructions] Our first question comes from Randy Binner with B.Riley. Please proceed with your question.

Randy Binner -- B.Riley FBR -- Analyst

Good morning. Thank you. Yeah, I have a few. Just on the commentary on the OC test, you mentioned it's trending better. And I think from Page 30 of your deck, it's up to 112 basis points. Yeah, just as a reminder, is that the right figure to be looking at and where could that trend back to do you think? Can it get back to historic levels?

Thomas P. Majewski -- Chief Executive Officer

Sure. A very good question. Yes, on Page 30, the 112 basis points. That's the number and you can see that's up from 83 basis points at the prior quarter-end. Some of the drivers of that are going to be a factor of how much CCC we have in any given portfolio. And if you look back on Pages 25 and 26, you can see the CCC percentages or CCC+ Caa1 or lower over on the right hand side. I mean, you can see quite a few of the CLOs are over 7.5%. And there is a haircut taken -- in typical CLO, there's a haircut taken in the OC tests for excess CCCs.

So as we -- the way to think of that broadly is to the extent we had more CCCs or the price of CCC loans fell, that would hurt the OC cushion. At the same time, if we have fewer and fewer CCCs or the price of CCCs rally because the OC test looks at a market value of those of the CCCs that we could actually get more cushion in the test.

In addition, the other factors in there sort of loan default would be a detriment. To the extent, there are trading gains or losses in the portfolio that can help or hurt the OC cushion. As to where it can get to, there is no functional limit on the upside and to the extent, you look at our average is about 13.5%. If you think of the average CCC as being around $0.70 on the dollar, just pick that as a number, you're taking a haircut over 7.5%, so 13.5 minus 7.5 is 6 points. If times 30%, you could be -- we could be taking off 180 basis points, 200 basis points of the OC test on average as a result of the high CCCs. So to your question, if the CCC buckets continue to come down, which is certainly the trend we've been seeing across many CLOs, you could see a path to get back to the 3s.

Randy Binner -- B.Riley FBR -- Analyst

Thank you for that. And then, I guess the follow-up question is I understand the markets have been better and -- but we have the -- some of your credits -- this is my perception and then if I'm mistaken, please correct me, but I feel like some of your credits would be more exposed to kind of worsening COVID trends in the economy maybe versus corporate credit more broadly. And so, is -- do you have a concern that it's kind of the incidence of COVID continues to increase. There is more lockdowns that you could see a reversal or do you feel like kind of the current credit trend is still catching up and moving in a positive direction? And if it's helpful to talk about certain sub-sectors to describe that, please do.

Thomas P. Majewski -- Chief Executive Officer

Sure. So to the first part of the question, I don't think we have a particularly adverse selection of above average COVID exposure versus broader below investment-grade credit at a high level. And if anything, I think the trend in the portfolios have been for collateral managers to reduce exposure in COVID-related industries. So I struggle to see us being in an adverse selection. And perhaps, we've been fortunate enough to get to a better situation. So when we look at these shutdowns and you look at changes in unemployment and changes in GDP, a year ago, people would be fussing over 50 basis point shift in GDP quarter-over-quarter. Then we have this gigantic drop in the second quarter and then the slow recovery now.

And all of sudden a double-digit default rate from what was functionally near full employment at the turn of the year. Yet, we're sitting here with 95% of our investment still paying current. So at a high level, that's -- that inputs a good result. To the extent, we see more shutdowns and/or more restrictions, which is unambiguously a trend throughout the country right now. That's a bad fact, but I don't see it as dire fact and that things that are helping us. Certainly, the fed is providing a lot of capital into the investment-grade market, which then by sort of definition brings along the high-yield market, which brings along the loan market as well. And frankly, the high-yield market has been a source of funding for many loan borrowers who might have needed additional liquidity. And whereas when we started this COVID period back in March, you would think broadly of the average leverage borrowers having three to nine months of liquidity as a broad generalization.

It's hard to see companies not having doubled or tripled their liquidity runway through different measures of cutting expenses and putting additional debt on their balance sheets. While that debt does eventually need to be repaid, it's typically many, many years out in the future before that's due. So if we were to see another turndown and slowdown in economic activity, I think companies have a much stronger balance sheets today, even the cruise lines and airlines and hotels, Hilton just did a bond deal yesterday at 4%, so even guys who would be squarely in the crosshairs have raised a ton of liquidity, which is great, which would give them more runway.

And then assuming we get some degree of political resolution in Washington, obviously no guarantees there, it's hard not to see some degree of additional stimulus coming out helping those who are unemployed. And when you think about how we made it through such a high unemployment rate with a relatively low default rate, that's largely because the government masked it in my opinion by sending checks to lots and lots of people every single week. Those checks have stopped, but to the extent, something resumes in the New Year. I think that would also be an offsetting fact. Long answer, but hopefully kind of get the flavor of how we're thinking about it.

Randy Binner -- B.Riley FBR -- Analyst

No -- yeah, that's exactly what I was looking for. I'll jump back in the queue. Thank you.

Thomas P. Majewski -- Chief Executive Officer

Thank you.

Operator

Our next question comes from Chris Kotowski with Oppenheimer. Please proceed with your question.

Chris Kotowski -- Oppenheimer -- Analyst

Yeah, good morning. Thanks for having me. I guess, my first question was, I mean in terms of the distributions, you highlighted the fact that third quarter distributions are in up 50% from the second quarter. And I'm wondering is that a function of the improvement in the OC cushion or is it kind of the natural lumpiness from quarter-to-quarter. And is there a way to kind of triangulate between say, what moving back to a 3%-ish OC average, OC cushion? What kind of impact that would have on your distributions from CLOs?

Thomas P. Majewski -- Chief Executive Officer

Sure. A good question. A little bit of none of the above on the first part. And then, we'll talk about how the OC test could impact the second -- how impact future distributions. The principal thing and if you look at the chart on -- deck on, when we find the page, on Page 23, this is a chart we don't like. We started at $1.08, $0.90, $0.68, $0.53, that's a CAGR no one is a fan of. The Q4 cash flows in October, as we shared, up over 50% from the October -- from the Q3 levels. So what caused the degradation? Broadly, the drop in the cash flows from Q1 to Q2 were new OC failures and CLOs that we're making payments all of a sudden diverting cash flows to either buy new collateral or pay down the AAAs. The drop from Q2 to Q3 probably was due to a pretty grievous LIBOR mismatch back at the -- back in the second quarter and that CLOs, each -- given CLOs set its LIBOR rate four different times a year. Loans set their LIBOR rates at -- probably one loan sets their rate every single day in a given CLO portfolio or pretty darn close to it.

As LIBOR fell precipitously during the second quarter, many CLOs were burdened with paying roughly 1% LIBOR during the second quarter, but loans kept resetting lower and lower and lower and in many cases, we actually had a negative LIBOR basis, which is what manifested itself in the reduction in cash flows from Q2 to Q3. So just due to a timing of the rapid movement in LIBOR rates, we were borrowing at 1% LIBOR proverbially and investing at a much lower LIBOR rate, which is bad. Roll the clock to October 2, two good things happened. Principally LIBOR stayed low, which then -- and as more and more loans have -- now have LIBOR floors, we were borrowing from the CLO debt investors at about 25 basis point LIBOR, but investing about half of the portfolio -- a little less than half in loans with 1% LIBOR floors. So all of the sudden whereas in the second quarter, we had a negative basis in LIBOR. Here, we had a positive basis.

To the extent LIBOR stays low, which is certainly the broad expectation in the market even the -- it could be the current five-year swap rate, it is -- 45 basis points current three-month LIBOR is 22 basis points. So the market is saying short-- the short-term rates are going to stay low for quite a period of time. Many, many loans have 1% LIBOR floor. So we're actually now on a positive basis, which we expect will continue and certainly as long as rates stay low, that will keep going. So we don't think it's a one-hit wonder with the October payments being so far up.

Then to the second part of your question, OC cushion, the OC test is a binary test. You either pass it or you fail it. So there is not a reduction, or if the OC goes a little down, you trim a little. It's kind of an all or none test, and you could partially pass it and cure, but that -- usually when these things go, they go by enough of a margin. I guess, it's possible you could have a tweener, but nearly all of the CLOs you can see are either comfortably passing or failing by a non-trivial amount.

So that OC cushion, the real thing to look at is deal specific. And so, the question to ask yourself is, do I think these deals can come back on sides. Some of our highest payers are the ones that are off size. Those are the ones often with the most aggressive and most spreading portfolios. As we construct our portfolio of CLO equity, we seek to have both conservative portfolios and more aggressive portfolios, and it's a continuum and as you'd expect in choppier times than more aggressive deals frankly are the ones that are more likely to be off size. Principally concentrated in Marathon and Zais if you had to kind of put it into two shelves. That said, each of the teams at their shops are working keenly. They have in many cases meaningful personal co-investment and even part of their fees are deferred. So there is significant incentive to get those transactions on side. I think some have the potential too, while others might have a more challenged period ahead of them, but -- so when you're looking at our future cash flows, the question is deal-by-deal and probably we are seeing a trend of OC cushions improving on the failing deals, but it takes a while for some of the most severe portfolios.

Chris Kotowski -- Oppenheimer -- Analyst

Okay. And then, you mentioned -- you talked about the LIBOR floors. And I have been kind of under the impression that most leveraged loans had LIBOR floors for years. I'm just kind of thinking, is it the percentage different now than it was, say, in 2015 and '16 when we were also here at zero LIBOR?

Thomas P. Majewski -- Chief Executive Officer

Yeah. So mindful that loans typically prepay -- so yes is the short answer. Mindful that loans typically prepay at a pretty rapid rate, kind of 30% per annum in normal market conditions. It's slowed somewhat during the COVID period. If you see on Page 19, we show the annual prepayment rate for loans, which I guess averages just less than 33%. So the universe of loans keeps changing. From 2015 indeed, the vast majority of loans had LIBOR floors as LIBOR crept up to 2%, 3%, it seems like so long ago. When you know those loan borrowers as they were issuing new loans or refinancing, they said, hey, maybe let's not put a floor and the market kind of said were at 3%, 2%. It doesn't really matter. That's fine. So now, we're in a situation where probably between 40% and 50% of the market broadly has LIBOR floors. That said, the vast majority of new loans getting issued today do a significant majority, do have LIBOR floors of new loans getting created. So the market kind of let those slip away in a high LIBOR day, but the trend is certainly coming back our way.

Chris Kotowski -- Oppenheimer -- Analyst

Okay. Got it. All right. That's it from me. Thank you.

Thomas P. Majewski -- Chief Executive Officer

Great. Thank you, Chris.

Operator

Our next question is from Mickey Schleien with Ladenburg Thalmann. Please proceed with your question.

Mickey Schleien -- Ladenburg Thalmann -- Analyst

Yes. Good morning, Tom and Ken. Hope you're well. Tom, could -- how would you describe trading in CLO equity currently in terms -- in the secondary markets in terms of volume and bid-ask spreads. I'm asking because sort of in the middle of the year, it was very choppy with wide spreads and that causes difficulty both in terms of making investments in terms of valuation. So curious where we stand now.

Thomas P. Majewski -- Chief Executive Officer

Certainly, volume has continued to pick up broadly. One of the things, so it's the I mean -- we've been active on a number of investments, we both bought and sold in the secondary market for CLO equity and debt. So the market is open and active. You see a typical pickup in activity right about now kind of right after payment date. So if the CLOs typically pay in October 15 and October 30, now is the time. We just got the payment. People will look to refresh or buy or sell things in their portfolio. So we're probably at a period of time with some meaningfully increased activity. There is a number of [Indecipherable] today that actually have CLO equity on them, including maybe even one or two matters within the Eagle Point complex.

The bid-ask spread is an interesting dynamic in the CLO market and that the -- while some dealers maintain inventory and a significant block of inventory, the vast majority of CLO equity trades on a customer-to-customer basis with a dealer intermediating for a small fee, I mean, in the case of CLO equity, typically at quarter point. So there might be Bank A in between of customers one and two. In theory, you don't know who the other person is and the dealer just takes us a small markup. So it's not as if you're kind of working off an offer sheet, which you might be in the loan or high-yield market where the dealers are going to have between 0.5 points and 2 point market. Here, you're able to get to a much tighter. The difference between the buyers and sellers pay as much lower, because you don't have a dealer taking risk in between against that buyer and seller expectations may vary. And that does give rise to a non-trivial spread whereas you put a bond up for auction, the highest bid might be 60, you get a couple of bids in the high 50s. Seller didn't want to sell below 65. So there is nothing to do and the auction fails or it's DNT. That's what it's called, does not trade.

There is probably I think buyers have gotten a little more realistic and sellers have gotten a little more realistic. Just probably in April, that was close to no secondary activity. And I'll say the volume has picked up slowly, gradually not every month has been up month-over-month, but in general, the volume has picked up. While there's still a few unrealistic sellers out there, when you put step out for bid, definitely get five to 15 bids depending on the security and it's really just your choice as the seller if you want to take them.

Mickey Schleien -- Ladenburg Thalmann -- Analyst

Thank you for that. That's helpful, Tom. And how would you characterize the investment opportunity in the primary markets within CLO equity?

Thomas P. Majewski -- Chief Executive Officer

I'd say it's recently gotten better and that probably the best piece of news is many CLOs are able to get done now with five-year reinvestment periods again. To kind of roll the clock back if we are talking in February, we would have said, oh, CLOs have a five-year reinvestment period and that's standard to your non-call. Then all the bad things happened in March. And by April, we were seeing CLOs get done on a static pool basis or with a one-year reinvestment period, we didn't participate in any of those. We did begin to participate in CLOs that had three-year reinvestment periods, which was kind of commonplace say between March and September. That's actually going to -- those had one-year non-calls and that's actually going to help us because we did two -- maybe two CLOs. Back in late Q2 or early Q3, we did an Octagon deal and a CIFC deal, both of which had AAAs like 150s, 160s, 170s context, which couldn't easily be refinanced tighter and thankfully those only have one year non-calls. So, while we had to suffer only getting a three-year reinvestment period, you can be assured. If markets stay the way they are today, we keenly try and refinance those deals as soon as next Q2 next year whenever they roll off of lock.

Seeing deals go out to five years now was even better, but at the price of a two-year non-call, but we are seeing AAAs broadly in the 130 context, which is generally in line with probably the long-term average or the average over the last seven-plus years in the CLO market. So that we're...

Mickey Schleien -- Ladenburg Thalmann -- Analyst

Pretty amazingly when you about it, right?

Thomas P. Majewski -- Chief Executive Officer

Yeah, well, I mean again [Indecipherable] 95% of our portfolio by market value still making current payments. We were at double-digit unemployment rate, radical double-digit GDP contraction, no CLO forcibly liquidated, some turned off payments for a while and now they're gradually coming back on sides. We have a stable hand and ECC itself has a stable hand that obviously we would like everything to pay all the time. Something bad is going to happen at some point in the future as well that we've got the steady hand both within the CLOs and within the company to be able to weather those storms.

Now that we're back to five-year issuance, we will probably turn up the gas a little bit. The one drawback when I talked about the price of loans that so many -- what was the stat, only pretty small -- only 13% of the loan market was below 90 that both is -- both the good and bad news. It's improved from 22% below 90 at the end of June. When you're creating new CLO, you want to buy loans cheap. When you've already got a CLO, you like loans to go up, I guess. So the price of loans certainly has continued to rally. The loan index is positive for the year. So loans are not being given away by any stretch, making it a little more difficult to make new CLOs work. That said, deals are getting done. We have a number of information phase. Whether we do anything more this year kind of still to be determined, but we're actively evaluating.

Mickey Schleien -- Ladenburg Thalmann -- Analyst

Okay. I understand. Tom, if we look at your portfolio, broadly speaking, could you give us a sense perhaps what percentage of your portfolio is in vintages you believe may not survive the impact of the pandemic and will have to eventually be unwound? This may be -- I'm thinking maybe the '14, '15, '16 vintages with a lot of oil and gas and maybe more retail in them, things like that.

Thomas P. Majewski -- Chief Executive Officer

Yeah, that's a very astute question. The -- that '14 vintage certainly was for all participants. The '14 vintage, particularly the middle of '14 had particularly high oil and gas exposure in those portfolios. The beginning of '14 didn't and the end of '14 didn't generally. But the second and third quarter really were -- was pretty darn high. So that's a bad fact in many. If you have started with high energy already kind of use some of your cushion dealing with that when not all went pear-shaped in '15 and '16. When you look at our portfolio, probably the biggest thing I would look at is those that could be the most problematic are those with low or negative OC cushion and those that have nothing left in the reinvestment period. That's where you could see things be kind of the least good.

I'll even compare two CLOs here, just make sure I get the right row. If you look at Zeiss 3 versus Zeiss 5, so these are both CLOs that are failing their OC test right now. Zeiss 3, we were able to get a reset off in Q2 of '16. We did that via Goldman I remember. That deal has got 2.8 years left to go, and so lots and lots of runway. Zeiss 5, we worked on doing a reset of that. We struggled to get the AAAs placed and unfortunately on that one, the reinvestment period is over. So despite the reverse order because 3 was reset, if I had a bet on one of those horses, I bet on 3 versus 5 just by virtue of -- it's got a lot more runway to go. So it's a combination of OC cushion and remaining reinvestment period that should kind of form the collage of how you think about which deals might be tougher.

Mickey Schleien -- Ladenburg Thalmann -- Analyst

I appreciate that. If I could switch gears maybe to yields, there was about a 60 basis point, 70 basis point decline in the average effective yield, excluding non-call deal. So, I was curious. We don't have a lot of time to look at your presentation materials before the call. So I was curious if there was something, specifically driving that. And if we think about the future, you've talked about very -- relatively speaking very strong cash flows in October, which implies cash yields meaningfully higher than they've been in the last couple of quarters. And I'm wondering with that trend, can we expect you to book more of that into income as through the effective yield just to reflect the dynamics in the market.

Thomas P. Majewski -- Chief Executive Officer

Let me add one or two points and maybe Ken will comment a little further around it. So one thing that moved against us when everyone we model CLOs, the short-term basis risk of LIBOR high versus LIBOR -- the high LIBOR that we set the CLO debt versus the low LIBOR. We are earning it in Q2. It's not something that they have -- the average industry model really factors in. People kind of assume LIBOR, canceled each other out with the exception of LIBOR floors. So broadly, if you were to look at where our yields were and what our cash flow projections were, back at the beginning of the year, we wouldn't have projected the significant drop on a deal -- forgetting that deals that went off size, deals that continued paying, we didn't model the drop in cash flows simply because we didn't model that LIBOR, we would be paying 1% and investing at lower than 1%.

So when you have less cash coming in versus your accrual, then kind of your amortized cost stays higher than it otherwise would have. So when you're going into recasting, we recast these every quarter now. Now we're starting in a situation where we have a higher-than-expected amortized cost. So whatever future cash flows you have are going to be -- it's just going to be a lower yield because you've got more basis that you're lending those cash flows over. And then Ken, do you want to comment any further around that?

Kenneth Onorio -- Chief Financial Officer and Chief Operating Officer

That's exactly right. Tom, it's a functioning of cash, relieving your amortized cost as well as any accretive cost, which would include previous interest receivable, which was not fully relieved when cash flows came in lower than expected. So I think if you follow the cash, Mickey, they will be decreasing the basis where as long as protective cash flows in the future are continued to sustain and in some cases, go up. The yield should follow. There may be a little bit of a lag because when those cash flows a little bit even a quarter lag. When those cash flows are coming in, they are amortizing the current cost, which is in the US as a basis for the protection in the next quarter.

Mickey Schleien -- Ladenburg Thalmann -- Analyst

I understand. Thank you for that, Ken. And my last question, Tom, triangulating your GAAP cash and taxable income is obviously very difficult for analysts, for investors, but...

Thomas P. Majewski -- Chief Executive Officer

And for company management.

Mickey Schleien -- Ladenburg Thalmann -- Analyst

Yeah. I know Ken and I have talked about that. So this year, I guess, year-to-date, there has been some return of capital reported. I think some of that is obviously because in the first quarter, you -- at least on a GAAP basis, you overdistributed, but now you're under distributing and then we've seen this dynamic where those CLO managers are reducing their CCC buckets. I suspect some of that is active selling and harvesting the consequence of that is maybe perhaps generating tax losses, which will depress taxable income. So looking ahead, I'm trying to understand where the distribution may end up when we're -- past COVID given that NII is now running comfortably ahead of the dividend and things look like they're moving in the right direction.

Thomas P. Majewski -- Chief Executive Officer

Yes. The -- I think you hit the nail on the head. There's definitely some losses getting realized in the CLOs. Even though they might not impact our current cash collections can have the impact of sheltering taxable income for some of the largest positions in our complex, which may include positions in ECC. We've hired an accountant to do a couple of preliminary estimates. And I think the answer is -- unfortunately, answer is varied. Some CLOs to the extent, we own them in PFIC form, are typically floored at flashing zero income. They can't flash up a negative taxable income to us, but it wouldn't surprise me to see some CLOs in the portfolio that are still generating full cash flows without interruption. We will be flashing zero taxable income to us this year. So all else equal, we like cash without the burden of tax. That's a good fact in general.

Against that, others will be failing OC test, but my general -- not paying cash and actually still flash us taxable income because they didn't take the losses. So it will be a little more scattered overall. I think it's safe to say the taxable income will be down year-over-year against that as you point out where the GAAP earnings are comfortably in excess of the NII, it's comfortably in excess of the distribution. The cash is up 50% was -- in excess of the distribution last quarter, it's up 50% quarter-over-quarter and expenses don't really go up that much when cash goes up that much. So those are some good facts. Hopefully, a path to both build back now over time both appreciation and getting extra cash off the investments.

Well, I'll say we -- when we set the new distribution rate back in the spring, we tried to be prudent and conservative with it. So we weren't trying to squeeze every last cents out. So perhaps there is more good things to come as well. But we'll continue to continue to watch the portfolio behave. These are long-term decisions we make, not short-term decisions. And with the number one objective, let's just keep the cash flow coming, keep hopefully getting more and more of the investments back on size and that can kind of help the boards at the distribution policy into next year.

Mickey Schleien -- Ladenburg Thalmann -- Analyst

I understand. Those are all my questions. I appreciate your time. Thank you very much.

Thomas P. Majewski -- Chief Executive Officer

Thanks, Mickey.

Operator

[Operator Instructions] Our next question comes from Ryan Lynch with KBW. Please proceed with your question.

Kenneth Onorio -- Chief Financial Officer and Chief Operating Officer

Hi, Ryan.

Ryan Lynch -- KBW -- Analyst

Good morning, Ken. It's been a really good discussion you guys had so far this morning. I just have two questions. First one is probably for you Ken. If I look at you net income this quarter of $1.40 per share and then, I look at your $0.24 dividend, that's about $1.16 net income after distributions this quarter. Your NAV was only up about $1.00 this quarter. So I was just curious, could you bridge that $0.16 gap?

Kenneth Onorio -- Chief Financial Officer and Chief Operating Officer

Sure. That would -- $0.16 would be the change in other comprehensive income during the quarter, which we report separately from the income statement.

Ryan Lynch -- KBW -- Analyst

And what was driving that?

Kenneth Onorio -- Chief Financial Officer and Chief Operating Officer

That's the change in the -- so we have -- one of our unsecured notes is using the fair value option of accounting. As a result, when there is a change in the fair value, we need to bifurcate that fair value through what is market related versus what might be individual company risk or individual credit risk. As you probably could recall from the beginning of the year, there was a significant decrease in the fair value of that liability, which would increase NAV and increase income. So we bifurcated that out at the time. And what you're seeing is a reversion of that effect coming back. So if you just look at the change between the two quarters of that other comprehensive income, that will get you to the $0.16 per share.

Thomas P. Majewski -- Chief Executive Officer

Yeah. So it's just the mark-to-market on the exes [Phonetic] basically.

Kenneth Onorio -- Chief Financial Officer and Chief Operating Officer

A portion of it.

Thomas P. Majewski -- Chief Executive Officer

A portion of it.

Ryan Lynch -- KBW -- Analyst

Okay. Got it. And then maybe just a rough math about the $27 million of net capital deployed in the quarter, roughly how much of that was deployed into new primary issuance CLO equity versus secondary CLO purchases and/or loan accumulation facilities or CLO debt? And just going forward, given the broader loan market has started to recover pretty nicely, CLO equity markets are starting to recover nicely as well, where are you seeing the best opportunities to deploy capitals? Are more going to be in primary issuance opportunities or are you still going to be pretty active in the secondary markets?

Thomas P. Majewski -- Chief Executive Officer

Sure. So let me give you a couple of stats here. During the third quarter, on a gross basis, ECC deployed $35.1 million into CLO equity. And of that, $8.4 million was in the secondary market and everything else was in the primary market. We also sold $4.8 million of securities obviously on the secondary market. During the quarter, we bought -- we put new money in to loan accumulation facilities of $30.1 million. And we took cash out of loan accumulation facilities of $26.4 million. We -- actually, net sold CLO debt looks like we bought $19.8 million and sold $27.1 million. So very active in the portfolio across all the different categories of investments.

In terms of the rationale on primary versus secondary, some of the primaries looking through -- all the primaries in Q3 were actually all post-COVID de novo primaries. We did one in Q4 that was a part of one of the predecessor, pre-COVID accumulation facilities. But maybe even just one post Q3. So the four primary deals were all entirely post-COVID portfolios that were built. Kind of where we're seeing the best value, and maybe just also highlight here, we're actively trading within CLO debt as well to the extent the company had extra cash. Debt opportunities in general are more plentiful than equity opportunities, buying things, selling at a couple of points higher. We're happy to do that as well to the -- while we're also looking for CLO equity opportunities. So that explains some of the debt portfolio turnover. Where we see the best opportunities today, really clean, long, secondary CLO equity, long as to a lot of reinvestment period remaining and lots of OC cushion. Like if you have more than three years reinvestment period and more than 3 points of OC cushion, that's kind of the Holy Grail right now. And that bid very, very keenly. Someone showed us a piece of paper yesterday. We didn't buy it. It would have been a sub-15% yield if we hit the level the seller was looking for.

Where we have been putting new money into the ground broadly and across the CLO is kind of $15.7 million to $18.6 million it looks like for the CLO purchases during the quarter in terms of the expected yield measured at time of purchase. The thing we liked the best is tough to find, as always the case, but I'm looking for CLOs with lower OC cushions, if you look at a CLO that only has 1 point of OC cushion versus 3 points, the market is going to value that very differently and say, well, this is thinner. It's got a higher risk of interruption, not very true. But then you have to overlay the collateral manager. And this is kind of where our deep inside knowledge in the market and personal connections and just knowing how people act really comes to be helpful and that some CLO managers have never missed a payment to the equity. There's usually a reason for that, because they focus very hard in the days leading up to the payment dates to keep their deals on size, even if it's close.

So these are tough to come by, but we have from time-to-time been able to source these buying things that are -- be hopefully longer, but with lower OC cushion. Very good CLO managers in some cases got unlucky with COVID. You could had a couple of really good names that -- we had a couple of Jims [Phonetic] or whatever it may be that in January were considered very good credits changed radically. So you could have something that's lower cushion, but with the CLO collateral manager of the D&A to keep it on size and focused, that's something that we really gravitate toward. I wish we had 20 of those opportunities. They're pretty scarce, however.

So we look at a collage of all of these. I expect we will continue to keep deploying in both the primary and secondary markets, certainly to the extent we can get up to five-year reinvestment periods on new CLOs. I guess even a three-year new deal will help lengthen our weighted average, a five-year will help lengthen it even more. So that's something we're going to focus toward. That said, we will continue to look for cheap secondary opportunities when they exist.

Ryan Lynch -- KBW -- Analyst

Okay. That's really helpful commentary and really good color on the market opportunities. Those are my questions. I appreciate the time today.

Kenneth Onorio -- Chief Financial Officer and Chief Operating Officer

Thanks so much, Ryan.

Operator

Our next question comes from Chris Kotowski with Oppenheimer. Please proceed with your question.

Chris Kotowski -- Oppenheimer -- Analyst

Hey. Yes. Thanks for taking the follow-up. I have a question, which I think is kind of basically like Mickey's, but I'm not sure I totally understood it. So let me ask it my way. I'm looking at Page 24 of the supplement and kind of if you think about the relationship between the distributions received from CLO equity and the investment income, you recognize as investment income and the current quarter was like 76%, last quarter it was 70%.

If you go back, for most of the year, it was probably closer to 50%. So, it seems like more of the distributions are slowing down to the income line, less of it is being treated as a return of capital and as we can see from that other line on Page 24. And so, what is driving that and what should we expect for the next couple of quarters? Roughly, this is what we see in the second and third quarters dropping down from distributions to investment income, is that what we should expect or should we expect it to revert back to where it was a year or two ago?

Kenneth Onorio -- Chief Financial Officer and Chief Operating Officer

Sure. So it's Ken here. And just one aspect before I get into the detail of the answer is this is a Q3 2020 view, the cash flows are the ones that are received in the current quarter and the income is also recorded for the current quarter. In large part, the cash flows that are coming in, in the current quarter reflect income that was accrued or recorded in the previous quarter.

That said, to your point, if there's less expected cash coming in, there would be more of a shift toward recognizing that as income versus return of capital. So if we fast forward this to Q4 where we're recording the cash flows coming in or ones that are received in the fourth quarter versus previous income, you will start to see a reversion of that effect where you'll see more of a balance between income and return of capital. So it may not be all the way that we were in the first quarter, but you'll start to see steps toward it.

Chris Kotowski -- Oppenheimer -- Analyst

Okay.

Thomas P. Majewski -- Chief Executive Officer

So, broadly if you think of our yield staying flat even if it we went down modestly. But if cash flow is up 50% and yield is flat, all that excess in theory should flow down as return of capital, if that makes sense?

Chris Kotowski -- Oppenheimer -- Analyst

Okay. I guess the more that number increases, the more of it is going to be a return of capital.

Kenneth Onorio -- Chief Financial Officer and Chief Operating Officer

Correct.

Chris Kotowski -- Oppenheimer -- Analyst

Okay. And is there anyway if we were clever enough, would there be a good way for us to model that and figure out what percentage we should plug into our models for fourth quarter and first quarter?

Thomas P. Majewski -- Chief Executive Officer

The income is going to be largely driven by the effective yield. There could be gains and losses. There's obviously CLO debt and loan accumulation facilities. But on the CLO equity, the effective yield, which we put at the end of the quarter, was 11% and change times the beginning, times the amortized cost of the CLO equity, not the market value, take that 11% and change divided by four times amortized cost, that's going to give you a rough cut at the CLO equity income. The cash, we've kind of -- we've told you what the cash is. So prior to Q4, you could figure that out. And then for Q1 and onward, to the extent you think LIBOR is going to remain low, that cash projections and OC tests aren't going to -- deals aren't going to come back or go off size. That's a pretty good base case for keeping that cash flow consistent.

Chris Kotowski -- Oppenheimer -- Analyst

Okay. All right. I think I got it. Thank you.

Thomas P. Majewski -- Chief Executive Officer

Okay. Great. Thanks, Chris.

Operator

Our next question comes from Steven Bavaria [Phonetic], a private investor. Please proceed with your question.

Thomas P. Majewski -- Chief Executive Officer

Hi, Steve. Steve, I'm having a hard time hearing you. Are you on the line?

Operator

Are you muted, Steven? Steven, you're live with our speaker.

Thomas P. Majewski -- Chief Executive Officer

I think he's actually dropped off. Maybe we'll just move on to Mickey again. And if Steve comes back, we'll pick him up.

Operator

Our next question is from Mickey Schleien with Ladenburg Thalmann. Please proceed with your question.

Mickey Schleien -- Ladenburg Thalmann -- Analyst

Tom, just a quick follow-up. I'm looking at the right-hand side of the balance sheet. We look at hopefully what will be a much better economic situation a year from now. It's conceivable that the fair value to cost of the portfolio will be a lot better than it is today. And your leverage measured on fair value could decline to levels that would be less than optimal. So my question is, if that were to occur, do you have more appetite to issue unsecured notes or would you prefer to issue preferred shares in that scenario?

Thomas P. Majewski -- Chief Executive Officer

Got it. So broadly, we seek to run the company at 25% to 35% leverage. Ideally, we're right at the midpoint of that. If you set a range, you kind of want to be at the middle. We are at the upper end of the band, but in the band as of September 30. Broadly, the way we've thought about the use of debt and preferred is we've kind of gone roughly halfsies between the two, never perfectly so. Each of them have different pros and cons. That is the cheapest source of financing for the company in that there's no management fees in kind of our shareholder-friendly fee structure. So there's -- I think we have about $100 million of debt outstanding give or take. That's all money that we manage on behalf of the company without any sort of base management fee. So that's accretive.

The flipside, the preferred stock, which we did repay the As last year and the beginning of this year, we still have I think $45 million of the Bs outstanding, give or take. Those aren't even callable until October of next year I think. There's a lot of ways to go before the Bs are even callable. Those do attract a management fee. Those have the advantage of also being deferrable. We could defer a payment on those for up to two years, not that we have any intent to, but that's always a nice option. And B, it attracts the lower asset coverage ratio of 200% versus 300%. So as we kind of look at the collage, we've generally run the company kind of 50/50 between the two. Repaying the As has kind of moved us a little more debt than preferred. But to the extent you saw the company at the low end or below the range, we consistently try to get back to the range. So in that case, it's possible we look to do something.

Mickey Schleien -- Ladenburg Thalmann -- Analyst

I understand. That's helpful. That was it for me. Thank you.

Thomas P. Majewski -- Chief Executive Officer

We've got Steve back on, it looks like.

Operator

Yes. Our next question is from Steven Bavaria, a private investor. Please proceed with your question.

Steven Bavaria -- Private Investor -- Analyst

Hello, Tom. I hope I'm coming through now. A technical glitch here.

Thomas P. Majewski -- Chief Executive Officer

We can hear you perfectly.

Steven Bavaria -- Private Investor -- Analyst

Great. Hey, just a question. You paint a wonderfully positive picture that I've heard elsewhere about the speculative grade universe, the companies that are the underlying borrowers being in a much better position now than they were probably at the beginning of the year to deal with whatever comes next with COVID and its economic consequences. I'm trying to square that with the projections from our friends at Standard & Poor's who throughout the summer and as most recently as October are still projecting a speculative grade future default rate up in the 12% area, which would be right about where it was back in 2008, 2009 at the height. Do you have any thoughts on whether they're just wrong or how -- whether we're talking about different parts -- different subsets of the universe to try to square the two views?

Thomas P. Majewski -- Chief Executive Officer

A very good question. So there's a little bit of a different universe set and there's probably a different view between rating agencies and banks right now. And rating agencies publish lots and lots of different default outlooks and maybe they even have competing departments sometimes. In one report from S&P, this is on a report from November 2nd, they predicted the S&P/LSTA Leveraged Loan Index 12 months trailing default rate by number of issuers would increase to 8% by June of 2021 was their forecast. So the other thing is, are you looking at notional, outstanding or by count? And all else equal...

Steven Bavaria -- Private Investor -- Analyst

That's down from their October. Okay. Well, that means they're bringing it down a bit. I haven't seen yet.

Thomas P. Majewski -- Chief Executive Officer

Now this is by count. It could be different by dollars. So there's a little bit there. Moody's, on the other hand, their global default rate will rise to 7.2% by the end of 2020 and peak in March at 8.1%, before dropping back to 6.3% in October of 2021 is the Moody's outlook. Now compare that to Bank of America and JPMorgan offering loan default rates, JPM saying this year is 3.5%, next year is 3.5% and I think BofA has guided down to 3.5% next year as well. So the bankers are a little more -- even both, the bankers are a little more optimistic than the rating agencies. Maybe the right answer is somewhere in between.

And just to frame it as well, CLOs typically have lower defaults than the broad market, while there's a few outliers the other way, if their current market rate is somewhere in the very low 4s. At present, ECC has about 2% default exposure. So in general, the CLO universe I'd say broadly has lower default exposure than the overall market. And then when you look at our portfolio, one of the metrics -- let me draw your attention to a particular page. Let me give you the exact page. I was looking for a number we actually don't publish, the below 80 numbers in our portfolio. In general, the percent of what -- we talked about the below 90 in the market and then the below 80, this is when you look at loans, what percentage are trading below 90, are trading below 80 and so on and so forth? Broadly, the percentage below 90 has come down a bunch and the percent below 80 marketwide has also come down a bunch.

And in my opinion, stuff that's trading below 80 today, really at a minimum have to scratch your head at. But marketwide, that's probably in the 7% to 9% -- 7% to 8% range broadly. I might be off a little bit on that. Those are the names in the market that kind of knowing what we know today, the market price is a reasonable indicator of default probability. Those are the ones that are really the watch list names in my opinion. Obviously, higher price ones can fall, but even that's indicating mid to upper single-digits. And that typically looks at the likelihood of default over the next one to three years. Even a company like Belk, which is a retailer in the Southeast, that one's trading in the 30s. I think the market still thinks they have a moderate liquidity runway, but maybe not a lot of ultimate recovery value.

Steven Bavaria -- Private Investor -- Analyst

Great. Thank you. It sounds like the assumptions that you've got in your own yield model probably reflect closer to what the banks are projecting, I'm assuming.

Thomas P. Majewski -- Chief Executive Officer

Yeah, broadly and the variables, kind of the big variables to think about the default rate, the recovery rate and the reinvestment price. And that's predicated on being in the reinvestment period and being able to reinvest, but it's the collage of those three that really drive how these things will perform. To the extent -- that goes to my comment earlier on two deals with the same collateral manager, I take the one with two plus years of reinvestment period versus zero, just because I know they've got a -- they can -- they have a much easier time trying to fight their way out of it in the one deal versus the other.

Steven Bavaria -- Private Investor -- Analyst

Thank you very much.

Thomas P. Majewski -- Chief Executive Officer

Great. Thanks, Steve.

Operator

We have reached the end of the question-and-answer session. At this time, I'd like to turn the call back over to management for closing comments.

Thomas P. Majewski -- Chief Executive Officer

Great. Thank you very much. We appreciate everyone's interest in Eagle Point Credit Company and certainly appreciate the thoughtful and insightful questions. We look forward to speaking with folks in the first quarter as well and also invite people to join Eagle Point Income Company's call, which will begin promptly in 18 minutes. Thank you very much.

Operator

[Operator Closing Remarks]

Duration: 70 minutes

Call participants:

Garrett Edson -- Managing Director of ICR Inc.

Thomas P. Majewski -- Chief Executive Officer

Kenneth Onorio -- Chief Financial Officer and Chief Operating Officer

Randy Binner -- B.Riley FBR -- Analyst

Chris Kotowski -- Oppenheimer -- Analyst

Mickey Schleien -- Ladenburg Thalmann -- Analyst

Ryan Lynch -- KBW -- Analyst

Steven Bavaria -- Private Investor -- Analyst

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