First Trust Senior Floating Rate Income Fund II Announces November Common Share Distribution

10/20/2025 – 09:03 PM

WHEATON, Ill. – First Trust Senior Floating Rate Income Fund II (FCT), a closed-end fund focusing on senior secured floating-rate corporate loans, has announced its monthly distribution for common shareholders. The fund will distribute $0.097 per share, payable on November 17, 2025, to shareholders of record as of November 3, 2025. The ex-dividend date is also slated for November 3, 2025.

The distribution will be derived from net investment income, return of capital, and potentially net short-term realized capital gains. A comprehensive breakdown of the distribution’s source and tax status for the entire year 2025 will be provided on Form 1099-DIV after the year’s end.

First Trust Advisors L.P. (FTA), the fund’s investment advisor, aims to maintain a consistent monthly distribution, believing it can positively influence the fund’s market price and premium/discount relative to its Net Asset Value (NAV). While this practice doesn’t alter the fund’s investment strategy, it may lead to a reduction in the fund’s NAV over time. This highlights a key consideration for investors: the distribution yield should be evaluated in conjunction with the fund’s long-term NAV performance.

FCT operates as a diversified, closed-end management investment company with the primary goal of generating a high level of current income, coupled with a secondary objective of capital preservation. These objectives are pursued through investments primarily in senior secured floating-rate corporate loans, with at least 80% of its managed assets typically allocated to lower-grade debt instruments. This allocation strategy, while potentially offering higher yields, inherently carries higher credit risk. These “junk” or “high-yield” securities are more susceptible to default, particularly during economic downturns. Investors should carefully consider their risk tolerance before investing in FCT, understanding that the higher yield comes with the potential for greater volatility and the risk of capital loss.

The fund’s investment in senior loans also presents specific risks, including the potential for weakened lender protections in newer loans. The absence of financial maintenance covenants can limit the lender’s ability to declare a default, even if a borrower’s financial performance deteriorates. This can hinder the fund’s ability to manage credit risk and restructure problematic loans, potentially increasing the fund’s exposure to losses. Moreover, the fund invests in second-lien loans that are subordinate to first-lien loans, exposing the fund to greater price volatility and liquidity risk. The value of the collateral securing the loan may also decline or become illiquid, which would adversely affect the value of the senior loan.

FTA manages or supervises approximately $299 billion in assets as of September 30, 2025, across various investment vehicles, including unit investment trusts, ETFs, closed-end funds, mutual funds, and separate managed accounts. The firm and its affiliate, First Trust Portfolios L.P. (FTP), are based in Wheaton, Illinois.

Investors should review the fund’s annual shareholder reports for a complete discussion of the risks associated with investing in FCT. It’s crucial to remember that past performance is not indicative of future results, and investment returns and market value will fluctuate. Shares, when sold, may be worth more or less than their original cost. The fund may not be suitable for all investors.