Oxford Square Capital Corp Reports Q2 2026 Earnings
Oxford Square Capital Corp (NYSE: OXSQ) reported net investment income of $5.1 million for the second quarter of 2026, driven by an increase in total investment income to $9.4 million from $8.9 million in Q1. The company attributed this improvement to a rebound after significant unrealized losses recorded earlier in the year and deployed $19.9 million into secondary market CLO equity tranches with expected cash-on-cash returns of around 20%. Portfolio performance was supported by an improved U.S. loan market, where the trailing default rate dropped from 1.44% to 0.97%. The company raised $17.8 million through an at-the-market offering and resolved a non-accrual debt position via restructuring into a first lien term loan now on accrual status. Management remains optimistic about the earnings potential of recent capital deployments but did not provide a timeline for achieving full dividend coverage from net investment income (NII). The Board has declared monthly distributions of $0.035 per share through December 2026, while monitoring an elevated default rate including liability management exercises at 2.77% and a distress ratio of 6.87%. Net asset value per share declined slightly to $1.29 from $1.32 due to the impact of new shares issued and ongoing distributions exceeding NII.
Tickers: $OXSQ
Topics: capital_deployment investment_income loan_market_trends