CION Cuts Leverage to 1.30x and Lowers Its Quarterly Distribution to $0.25 Per Share

Net asset value fell 2.7% to $13.20 per share in the third quarter, and non-accrual investments rose to 4.85% of the portfolio at amortized cost.

November 5, 2026

CION Investment Corporation (NYSE: CION) reduced its total debt to $897 million at September 30 from $1.17 billion at June 30, bringing its net debt-to-equity ratio down to 1.30x from 1.52x. The BDC's co-chief executive officers also declared base distributions totaling $0.25 per share for the first quarter of 2027, below the $0.30 per share declared for each of the second and third quarters of 2026.

The new distributions will be paid monthly, at $0.08 in January and February and $0.09 in March. Third-quarter net investment income was $0.25 per share, compared with $0.29 in the second quarter and $0.74 in the third quarter of 2025. CION paid $14.8 million, or $0.30 per share, in base distributions during the quarter.

Debt Reduction

On August 31, CION repaid the full $114.8 million principal of its Tel Aviv-listed Series A senior unsecured notes, which were then delisted. During the quarter it also repaid the $200 million outstanding under its senior secured JPM Credit Facility and terminated the facility.

In July and August, CION sold $35 million of 8.00% unsecured notes due 2031 and $2 million of 7.50% unsecured notes due 2029 to institutional investors, drawing on a private placement of up to $60 million of senior unsecured notes it agreed to in July. Another $8 million of the 2029 notes and $15 million of the 2031 notes may be issued before July 15, 2027, subject to the purchasers' acceptance.

At quarter end, the debt consisted of $100 million of borrowings under a senior secured credit facility and $797 million of unsecured notes and term loans. CION held $51 million in cash and short-term investments and had $25 million available under its financing arrangements.

Co-Chief Executive Officer Michael Reisner said the company had told shareholders in the second quarter that it planned to strengthen its balance sheet, and that leverage ended the third quarter below the target it had set. He attributed the quarter's lower earnings mainly to the deleveraging and to the sale of assets to a new joint venture, and said they did not reflect a fundamental decline in the portfolio's overall credit quality.

Senior Loan Fund Partners

On September 17, CION and a group of institutional investors launched Senior Loan Fund Partners, LLC (SLFP), a joint venture that invests primarily in senior secured first lien loans to U.S. middle-market companies. SLFP was capitalized with $125.0 million of senior secured notes due 2033 and $59.7 million of LLC interests. CION holds 80% of those interests as common interests, and the investors hold the other 20% as preferred interests.

The same day, CION and its wholly owned financing subsidiaries sold 20 first lien loans with an aggregate par value of $180.3 million to SLFP for $180.0 million.

Earnings and Portfolio

Total investment income was $48.3 million, compared with $49.8 million in the second quarter and $78.7 million a year earlier. The company cited lower interest income from a smaller portfolio, lower transaction fees and the reduction of a legacy transaction fee whose collection is not reasonably assured, partly offset by higher dividends from one equity investment and higher prepayment fees. Dividend income from non-controlled affiliated investments was $14.3 million, up from $370,000 a year earlier.

The portfolio stood at $1.47 billion at fair value across 79 companies in 23 industries, down from $1.65 billion and 82 companies at June 30. Senior secured first lien debt made up 71.6% of the portfolio, equity 27.9% and unsecured debt 0.5%. Of $77.4 million in new commitments during the quarter, all to existing portfolio companies, $49.2 million was equity. Sales and repayments totaled $256 million, and the funded portfolio fell by a net $173 million.

Investments on non-accrual status rose to 1.63% of the portfolio at fair value and 4.85% at amortized cost, from 1.44% and 4.41% at June 30. The yield on performing loans at amortized cost rose to 11.35% from 11.23%, while the yield on total investments at amortized cost fell to 8.27% from 8.90%. Weighted average net debt to EBITDA across portfolio companies rose to 5.17x from 5.07x, and weighted average interest coverage slipped to 1.82x from 1.87x.

Net asset value per share fell $0.37 to $13.20, which the company attributed to realized losses on the restructuring of certain investments, mark-to-market price declines and distributions in excess of net investment income. Net realized losses were $9.2 million and net unrealized losses $6.7 million, producing a loss of $0.07 per share for the quarter.