First Trust Senior Floating Rate Income Fund II Declares Monthly Common Stock Distribution of $0.0976 per Share for May


WHEATON, Illinois–(BUSINESS WIRE)–First Trust Senior Floating Rate Income Fund II (the “Fund”) (NYSE: FCT) has declared the regular monthly distribution of common shares of the Fund in the amount of $0.0976 per share payable May 17, 2021 to shareholders of record as of May 4, 2021. The ex-dividend date is expected to be May 3, 2021. Information on the Fund’s monthly distribution is set out below.

First Trust II Senior Floating Rate Income Fund (FCT):

Breakdown per share:


Distribution rate based on the April 19, 2021 NAV of $12.71:


Distribution rate based on April 19, 2021 closing price of $12.24:


This distribution will consist of net investment income earned by the Fund and a return of capital and may also consist of net short-term realized capital gains. The final determination of the source and tax status of all 2021 distributions will be made after the end of 2021 and will be provided on Form 1099-DIV.

The Fund is a diversified closed-end investment company. The primary investment objective of the Fund is to seek a high level of current income. As a secondary objective, the Fund attempts to preserve capital. The Fund pursues these investment objectives by investing primarily in floating rate senior secured corporate loans. Under normal market conditions, the Fund will invest at least 80% of its assets under management in lower quality debt securities.

First Trust Advisors LP (“FTA”) is a federally registered investment adviser and acts as the investment adviser to the Fund. FTA and its affiliate First Trust Portfolios LP (“FTP”), a FINRA-registered broker, are private companies that provide a variety of investment services. FTA has collective assets under management or supervision of approximately $186 billion as of March 31, 2021 through unit investment trusts, exchange-traded funds, closed-end funds, mutual funds and accounts managed separately. FTA is the supervisor of the First Trust Unitary Investment Trusts, while FTP is the sponsor. FTP is also a distributor of UCITS units and UCITS creation units. FTA and FTP are based in Wheaton, Illinois.

Past performance is not indicative of future results. Investment returns and the market value of an investment in the Fund will fluctuate. Stocks, when sold, may be worth more or less than their original cost. There can be no assurance that the Fund’s investment objectives will be achieved. The Fund may not be suitable for all investors.

Main risk factors: the securities held by a fund, as well as the shares of a fund itself, are subject to market fluctuations caused by factors such as general economic conditions, political events, regulatory or market, changes in interest rates and perceived security trends. prices. A fund’s shares could lose value or underperform other investments because of the risk of loss associated with these market movements. In addition, local, regional or global events such as war, acts of terrorism, the spread of infectious diseases or other public health issues, recessions or other events could have a material adverse impact on a funds and their investments. Such events may affect certain geographic regions, countries, sectors and industries more significantly than others. The outbreak of the respiratory disease referred to as COVID-19 in December 2019 caused significant volatility and decline in global financial markets, resulting in losses for investors. The COVID-19 pandemic may last for an extended period and will continue to impact the economy for the foreseeable future.

The Fund will generally invest in senior loans rated below investment grade, commonly referred to as ‘junk’ or ‘high yield’ securities and considered speculative due to the credit risk of their issuers. These issuers are more likely than investment grade issuers to default on their interest and principal payments owed to the Fund, and such failures could reduce the net asset value and income distributions of the Fund. An economic downturn would typically result in a higher default rate, and a senior loan can lose significant market value before a default occurs. In addition, any particular collateral used to secure a Senior Loan may decline in value or become illiquid, which would adversely affect the value of the Senior Loan.

The Senior Loan market has seen an increase in loans with weaker lender protections, which could impact recovery values ​​and/or trading levels in the future. The absence of financial maintenance covenants in a loan agreement generally means that the lender may not be able to declare default if financial performance deteriorates. This may impede the Fund’s ability to reassess the credit risk associated with a particular borrower and reduce the Fund’s ability to restructure a problem loan and mitigate potential losses. Accordingly, the Fund’s exposure to losses on investments in Senior Loans may be increased, particularly during a downturn in the credit cycle or changes in market or economic conditions.

If a borrower fails to pay the scheduled interest or principal payments on a Senior Loan held by the Fund, the Fund will suffer a reduction in its income and a decline in the value of the Senior Loan, which will likely reduce dividends and result in a a decline in the net asset value of the common shares of the Fund. If the Fund acquires a senior loan from another lender, for example by acquiring an equity interest, the Fund may also be subject to credit risks with respect to that lender. Although Senior Loans may be secured by specific collateral, the value of the collateral may not be equal to the Fund’s investment when the principal loan is acquired or may fall below the principal amount of the principal loan after the acquisition. investment of the Fund. In addition, to the extent that the collateral consists of shares of the borrower or its subsidiaries or affiliates, the Fund bears the risk that the share may decline in value, be relatively illiquid and/or lose all or substantially all of its value, causing the senior loan to be under-collateralized. Accordingly, liquidation of the collateral underlying a senior loan may not satisfy the issuer’s obligation to the Fund for non-payment of expected interest or principal, and the collateral may not be readily liquidated.

To the extent that a fund invests in floating or variable rate bonds which use the London Interbank Offered Rate (“LIBOR”) as its benchmark interest rate, it is subject to LIBOR risk. The UK Financial Conduct Authority, which regulates LIBOR, will cease offering LIBOR as a benchmark rate during a phase-out period beginning immediately after December 31, 2021. The unavailability or replacement of LIBOR may affect the value, liquidity or yield on certain fund investments and may result in costs incurred in closing positions and entering into new transactions. The full potential effects of the transition from LIBOR on the fund or on certain instruments in which the fund invests may be difficult to determine, and may vary depending on various factors, and could result in losses for the fund.

The Fund’s portfolio is also subject to credit risk, interest rate risk, liquidity risk, prepayment risk and reinvestment risk. Interest rate risk is the risk that the value of fixed income securities will decline due to changes in market interest rates. Credit risk is the risk that an issuer of a security will be unable or unwilling to make payments of dividends, interest and/or principal when due and that the value of a security may therefore decrease. Credit risk may be increased for the Fund as it invests in below investment grade securities. Liquidity risk is the risk that the fund will find it difficult to dispose of senior loans if it seeks to repay debt, pay dividends or expenses, or take advantage of a new investment opportunity. Early redemption risk is the risk that, upon early redemption, the actual outstanding debt on which the Fund derives interest income will be reduced. The Fund may not be able to reinvest the proceeds received on terms as favorable as the prepaid loan. Reinvestment risk is the risk that the Fund’s portfolio income will decline if the Fund invests the proceeds of instruments that mature, trade or are redeemed at market interest rates that are lower than the current rate of return of the Fund’s portfolio.

A second lien loan may have a claim on the same collateral pool as the first lien or it may be secured by a separate set of assets. Second lien loans are usually secured by a second lien or lien on a specified collateral securing the borrower’s obligation under the interest. Since second lien loans are second lien to first lien loans, they carry a higher degree of investment risk. Specifically, these loans are subject to the additional risk that the borrower’s cash flow and collateral securing the loan will be insufficient to meet scheduled payments after giving effect to higher priority loans. In addition, loans that have a lower priority than the first ranking priority on the borrower’s collateral generally have greater price volatility than loans with a higher priority and may be less liquid.

Distressed securities often produce no income while outstanding. The Fund may incur certain extraordinary expenses in order to protect and recover its investment. The Fund will also be subject to substantial uncertainty as to when, how and at what value the obligations embodied by the Distressed Securities will eventually be satisfied.

The use of leverage may involve additional risks and costs and may magnify the effect of any loss.

The risks linked to an investment in the Fund are specified in the reports to shareholders and other regulatory documents.

The information presented is not intended to constitute an investment recommendation or advice to any particular person. By providing this information, First Trust is not undertaking to provide advice in a fiduciary capacity within the meaning of ERISA, the Internal Revenue Code or any other regulatory framework. Finance professionals are responsible for independently assessing investment risks and exercising independent judgment in determining whether investments are appropriate for their clients.

The Fund’s daily closing price on the New York Stock Exchange and net asset value per share and other information can be viewed at or by calling 1-800-988-5891.


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