20 April 2017
New York
Reporter: Drew Nicol

BlackRock’s sec lending falls short in Q1

BlackRock’s Q1 securities lending revenue failed to match last year’s figures, with the world’s largest asset manager recording $141 million last quarter, just shy of the $148 million achieved in 2016.

As part of its tangible assets sub-section of its Q1 report, BlackRock noted that the number of separate account assets and separate account collateral held under securities lending agreements increased from 177 as of 31 December 2016 to 187 by 31 March.

The value of these assets went from $220 billion last year to $231 billion at the end of March.

As a business group, investment advisory, administration fees and securities lending revenue increased to $171 million from Q1 2016.

BlackRock said this reflected “the impact of higher markets and organic growth on average assets under management (AUM), and the effect of the roughly $370 billion in AUM acquired in the BofA Global Capital Management acquisition in April 2016”.

The overall revenue boost was partially offset by the impact of foreign exchange movements and the effect of one less day in the current quarter.

Equity net inflows of $1.8 billion reflected inflows into index mutual funds. Multi-asset net outflows of $1.7 billion were largely due to outflows from world allocation strategies.

Long-term net inflows into iShares exchange-traded funds (ETFs) reached $64.5 billion thanks to equity net inflows of $44.6 billion, with strength in iShares Core, precision exposure and financial instrument ETFs.

Fixed income net inflows of $20.3 billion reflected inflows into investment grade corporate, emerging markets debt and treasury bond funds.

Laurence Fink, chairman and CEO of BlackRock, commented: “Both retail and institutional investors continued to utilise BlackRock’s iShares ETFs as the building blocks for their portfolios and in combinations to drive active returns.”

“iShares saw record quarterly inflows of $64 billion, again capturing the number one share of industry flows globally, in the US and in Europe, and in equity and fixed income.”

Fink continued: “Building on record total net inflows of $202 billion in 2016, we began 2017 by repositioning our active equity platform and investing in our business for future growth. Going forward, we will continue to transform change into opportunity, using our advantaged market position to create better financial futures for clients and drive long-term growth for shareholders.”

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