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BLK Blackrock

Filed: 14 Jul 21, 7:43am

Exhibit 99.1

 

 

 

 

 

INVESTOR RELATIONS:

Caroline Rodda      212.810.3442

MEDIA RELATIONS:

Brian Beades      212.810.5596

 

 

 

 

BlackRock Reports Second Quarter 2021 Diluted EPS of $8.92, or $10.03 as adjusted

New York, July 14, 2021  –  BlackRock, Inc. (NYSE: BLK) today reported financial results for the three and six months ended June 30, 2021.

 

$81 billion of quarterly total net inflows, driven by continued momentum across the platform, reflect a previously announced $58 billion low-fee institutional index outflow related to a single client

 

$63 billion of active net inflows, once again positive across all product types, including equity, fixed income, multi-asset and alternatives

 

32% increase in revenue year-over-year reflects significant market gains as well as strong organic growth, higher performance fees and 14% growth in technology services revenue

 

37% increase in operating income year-over-year

 

14% increase in diluted EPS (28% as adjusted) year-over-year also reflects lower nonoperating income and a higher effective tax rate in the current quarter

 

Consistent capital management with $300 million of quarterly share repurchases

 

 

Laurence D. Fink, Chairman and CEO:

“BlackRock’s comprehensive investment and technology platform continues to evolve ahead of our clients’ needs. Strong annualized organic base fee growth of 10% in the second quarter was driven by our top-performing active platform and industry-leading iShares ETF franchise. We also delivered 14% year-over-year growth in technology services revenue.

“Our longstanding approach to invest for the future positions our platform to better serve clients and generate more consistent organic growth. In sustainability, we are investing in products, data and analytics and technology to help investors capture the opportunity and manage the risks presented by sustainable factors. This is resonating with our clients and we generated $35 billion of sustainable net inflows in the quarter. Through our wealth and ETF businesses, we are driving the democratization of personalized portfolios at scale. And we are bringing together the breadth of our investment platform, portfolio construction expertise and Aladdin technology to serve clients’ whole portfolios in a way that no other asset manager can.

“Our commitment to helping more and more people experience financial well-being guides our long-term strategy and how we use our voice on behalf of our stakeholders. We will continue to invest and evolve so we can deliver value for our clients, employees, shareholders and the communities where we operate.”

 

 

 

FINANCIAL RESULTS

 

Q2

 

 

Q2

 

(in millions, except per share data)

2021

 

 

2020

 

AUM

$

9,495,993

 

 

$

7,317,949

 

% change

 

30

%

 

 

 

 

Average AUM

$

9,317,092

 

 

$

6,975,779

 

% change

 

34

%

 

 

 

 

Total net flows

$

80,960

 

 

$

100,217

 

 

 

 

 

 

 

 

 

GAAP basis:

 

 

 

 

 

 

 

Revenue

$

4,820

 

 

$

3,648

 

% change

 

32

%

 

 

 

 

Operating income

$

1,931

 

 

$

1,406

 

% change

 

37

%

 

 

 

 

Operating margin

 

40.1

%

 

 

38.5

%

Net income(1)

$

1,378

 

 

$

1,214

 

% change

 

14

%

 

 

 

 

Diluted EPS

$

8.92

 

 

$

7.85

 

% change

 

14

%

 

 

 

 

Weighted-average diluted shares

 

154.4

 

 

 

154.7

 

% change

 

0

%

 

 

 

 

 

 

 

 

 

 

 

 

As Adjusted:

 

 

 

 

 

 

 

Operating income(2)

$

1,931

 

 

$

1,406

 

% change

 

37

%

 

 

 

 

Operating margin(2)

 

44.9

%

 

 

43.7

%

Net income(1) (2)

$

1,549

 

 

$

1,214

 

% change

 

28

%

 

 

 

 

Diluted EPS(2)

$

10.03

 

 

$

7.85

 

% change

 

28

%

 

 

 

 

(1)

Net income represents net income attributable to BlackRock, Inc.

(2)

See notes (1) through (3) to the condensed consolidated statements of income and supplemental information on pages 11 and 12 for more information on as adjusted items and the reconciliation to GAAP.

NET FLOW HIGHLIGHTS

 

 

 

Q2

YTD

(in billions)

2021

2021

Long-term net flows:

$

60

 

 

$

192

 

 

 

 

 

 

 

 

 

 

 

 

 

By region:

 

 

 

 

 

 

 

 

 

 

 

 

Americas

$

2

 

 

$

74

 

 

 

EMEA

 

61

 

 

 

100

 

 

 

APAC

 

(3

)

 

 

18

 

 

 

 

 

 

 

 

 

 

 

 

 

By client type:

 

 

 

 

 

 

 

 

 

 

 

 

Retail:

$

21

 

 

$

58

 

 

 

 

US

 

10

 

 

 

33

 

 

 

 

International

 

11

 

 

 

25

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ETFs:

$

75

 

 

$

144

 

 

 

 

Core equity

 

23

 

 

 

51

 

 

 

 

Strategic

 

39

 

 

 

57

 

 

 

 

Precision

 

13

 

 

 

36

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Institutional:

$

(37

)

 

$

(9

)

 

 

 

Active

 

43

 

 

 

60

 

 

 

 

Index

 

(80

)

 

 

(69

)

 

 

 

 

 

 

 

 

 

 

 

 

Cash management net flows

$

23

 

 

$

63

 

 

 

 

 

 

 

 

 

 

 

 

 

Advisory net flows

$

(2

)

 

$

(2

)

 

 

 

 

 

 

 

 

 

 

 

 

Total net flows

$

81

 

 

$

253

 

 

 

 

 

 

 

 

1

 


 

 

BUSINESS RESULTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q2 2021

 

 

 

 

 

 

 

 

 

Q2 2021

 

 

 

 

Base fees(1)

 

 

 

 

 

 

 

 

 

Base fees(1)

 

June 30, 2021

 

and securities

 

 

 

Q2 2021

 

June 30, 2021

 

and securities

 

AUM

 

lending revenue

 

 

(in millions), (unaudited)

Net flows

 

AUM

 

lending revenue

 

% of Total

 

% of Total

 

 

RESULTS BY CLIENT TYPE

Retail

$

21,386

 

$

995,483

 

$

1,231

 

 

10

%

 

34

%

 

ETFs

 

75,147

 

 

3,031,505

 

 

1,505

 

 

32

%

 

40

%

 

Institutional:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Active

 

43,469

 

 

1,624,049

 

 

657

 

 

17

%

 

17

%

 

Index

 

(80,298

)

 

3,097,073

 

 

273

 

 

33

%

 

7

%

 

Total institutional

 

(36,829

)

 

4,721,122

 

 

930

 

 

50

%

 

24

%

 

Long-term

 

59,704

 

 

8,748,110

 

 

3,666

 

 

92

%

 

98

%

 

Cash management

 

23,339

 

 

727,603

 

 

91

 

 

8

%

 

2

%

 

Advisory(2)

 

(2,083

)

 

20,280

 

 

-

 

 

-

 

 

-

 

 

Total

$

80,960

 

$

9,495,993

 

$

3,757

 

 

100

%

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

RESULTS BY INVESTMENT STYLE

Active

$

62,750

 

$

2,446,632

 

$

1,842

 

 

26

%

 

49

%

 

Index and ETFs

 

(3,046

)

 

6,301,478

 

 

1,824

 

 

66

%

 

49

%

 

Long-term

 

59,704

 

 

8,748,110

 

 

3,666

 

 

92

%

 

98

%

 

Cash management

 

23,339

 

 

727,603

 

 

91

 

 

8

%

 

2

%

 

Advisory(2)

 

(2,083

)

 

20,280

 

 

-

 

 

-

 

 

-

 

 

Total

$

80,960

 

$

9,495,993

 

$

3,757

 

 

100

%

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

RESULTS BY PRODUCT TYPE

Equity

$

(26,453

)

$

5,034,391

 

$

1,995

 

 

52

%

 

54

%

 

Fixed income

 

41,290

 

 

2,712,165

 

 

955

 

 

29

%

 

25

%

 

Multi-asset

 

36,137

 

 

748,770

 

 

344

 

 

8

%

 

9

%

 

Alternatives

 

8,730

 

 

252,784

 

 

372

 

 

3

%

 

10

%

 

Long-term

 

59,704

 

 

8,748,110

 

 

3,666

 

 

92

%

 

98

%

 

Cash management

 

23,339

 

 

727,603

 

 

91

 

 

8

%

 

2

%

 

Advisory(2)

 

(2,083

)

 

20,280

 

 

-

 

 

-

 

 

-

 

 

Total

$

80,960

 

$

9,495,993

 

$

3,757

 

 

100

%

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Base fees include investment advisory and administration fees.

(2)

Approximately $2.2 billion of ETFs AUM held in advisory accounts associated with the Federal Reserve Bank of New York (“FRBNY”) assignment as of June 30, 2021 (disclosed via FRBNY reporting as of July 13, 2021) are included within ETF AUM or Fixed Income AUM above. These holdings are excluded from Advisory AUM.

INVESTMENT PERFORMANCE AT June 30, 2021(1)

 

 

One-year period

 

Three-year period

 

Five-year period

 

Fixed income:

 

 

 

 

 

 

 

 

 

Actively managed AUM above benchmark or peer median

 

 

 

 

 

 

 

 

 

Taxable

81%

 

84%

 

93%

 

Tax-exempt

77%

 

65%

 

79%

 

Index AUM within or above applicable tolerance

83%

 

93%

 

94%

 

Equity:

 

 

 

 

 

 

 

 

 

Actively managed AUM above benchmark or peer median

 

 

 

 

 

 

 

 

 

Fundamental

50%

 

84%

 

87%

 

Systematic

69%

 

60%

 

97%

 

Index AUM within or above applicable tolerance

94%

 

97%

 

98%

 

 

(1)

Past performance is not indicative of future results. The performance information shown is based on preliminary available data. Please refer to page 13 for performance disclosure detail.

TELECONFERENCE, WEBCAST AND PRESENTATION INFORMATION

Chairman and Chief Executive Officer, Laurence D. Fink, President, Robert S. Kapito, and Chief Financial Officer, Gary S. Shedlin, will host a teleconference call for investors and analysts on Wednesday, July 14, 2021 at 8:30 a.m. (Eastern Time). Members of the public who are interested in participating in the teleconference should dial, from the United States, (800) 374-0176, or from outside the United States, (706) 679-8281, shortly before 8:30 a.m. and reference the BlackRock Conference Call (ID Number 6479566). A live, listen-only webcast will also be available via the investor relations section of www.blackrock.com.

Both the teleconference and webcast will be available for replay by 11:30 a.m. (Eastern Time) on Wednesday, July 14, 2021 and ending at midnight on Wednesday, July 28, 2021. To access the replay of the teleconference, callers from the United States should dial (855) 859-2056 and callers from outside the United States should dial (404) 537-3406 and enter the Conference ID Number 6479566. To access the webcast, please visit the investor relations section of www.blackrock.com.

ABOUT BLACKROCK

BlackRock’s purpose is to help more and more people experience financial well-being. As a fiduciary to investors and a leading provider of financial technology, we help millions of people build savings that serve them throughout their lives by making investing easier and more affordable. For additional information on BlackRock, please visit www.blackrock.com/corporate | Twitter: @blackrock | LinkedIn: www.linkedin.com/company/blackrock.

2

 


 

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND SUPPLEMENTAL INFORMATION

(in millions, except shares and per share data), (unaudited)

 

 

 

 

 

 

 

 

 

Three Months

 

 

 

 

 

 

Three Months Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

March 31,

 

 

 

 

 

 

2021

 

 

2020

 

 

Change

 

 

2021

 

 

Change

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment advisory, administration fees and

  securities lending revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment advisory and administration fees

$

3,617

 

 

$

2,756

 

 

$

861

 

 

$

3,465

 

 

$

152

 

Securities lending revenue

 

140

 

 

 

210

 

 

 

(70

)

 

 

127

 

 

 

13

 

Total Investment advisory, administration fees and

  securities lending revenue

 

3,757

 

 

 

2,966

 

 

 

791

 

 

 

3,592

 

 

 

165

 

Investment advisory performance fees

 

340

 

 

 

112

 

 

 

228

 

 

 

129

 

 

 

211

 

Technology services revenue

 

316

 

 

 

278

 

 

 

38

 

 

 

306

 

 

 

10

 

Distribution fees

 

369

 

 

 

253

 

 

 

116

 

 

 

340

 

 

 

29

 

Advisory and other revenue

 

38

 

 

 

39

 

 

 

(1

)

 

 

31

 

 

 

7

 

Total revenue

 

4,820

 

 

 

3,648

 

 

 

1,172

 

 

 

4,398

 

 

 

422

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

1,548

 

 

 

1,152

 

 

 

396

 

 

 

1,409

 

 

 

139

 

Distribution and servicing costs

 

523

 

 

 

429

 

 

 

94

 

 

 

505

 

 

 

18

 

Direct fund expense

 

320

 

 

 

246

 

 

 

74

 

 

 

320

 

 

 

-

 

General and administration expense

 

461

 

 

 

388

 

 

 

73

 

 

 

585

 

 

 

(124

)

Amortization of intangible assets

 

37

 

 

 

27

 

 

 

10

 

 

 

34

 

 

 

3

 

Total expense

 

2,889

 

 

 

2,242

 

 

 

647

 

 

 

2,853

 

 

 

36

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

1,931

 

 

 

1,406

 

 

 

525

 

 

 

1,545

 

 

 

386

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonoperating income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net gain (loss) on investments

 

314

 

 

 

398

 

 

 

(84

)

 

 

82

 

 

 

232

 

Interest and dividend income

 

8

 

 

 

10

 

 

 

(2

)

 

 

19

 

 

 

(11

)

Interest expense

 

(52

)

 

 

(51

)

 

 

(1

)

 

 

(55

)

 

 

3

 

Total nonoperating income (expense)

 

270

 

 

 

357

 

 

 

(87

)

 

 

46

 

 

 

224

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

2,201

 

 

 

1,763

 

 

 

438

 

 

 

1,591

 

 

 

610

 

Income tax expense

 

654

 

 

 

361

 

 

 

293

 

 

 

318

 

 

 

336

 

Net income

 

1,547

 

 

 

1,402

 

 

 

145

 

 

 

1,273

 

 

 

274

 

Less:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to noncontrolling

  interests

 

169

 

 

 

188

 

 

 

(19

)

 

 

74

 

 

 

95

 

Net income attributable to BlackRock, Inc.

$

1,378

 

 

$

1,214

 

 

$

164

 

 

$

1,199

 

 

$

179

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

152,443,039

 

 

 

153,732,878

 

 

 

(1,289,839

)

 

 

152,567,453

 

 

 

(124,414

)

Diluted

 

154,417,581

 

 

 

154,712,032

 

 

 

(294,451

)

 

 

154,301,812

 

 

 

115,769

 

Earnings per share attributable to BlackRock, Inc.

   common stockholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

9.04

 

 

$

7.90

 

 

$

1.14

 

 

$

7.86

 

 

$

1.18

 

Diluted

$

8.92

 

 

$

7.85

 

 

$

1.07

 

 

$

7.77

 

 

$

1.15

 

Cash dividends declared and paid per share

$

4.13

 

 

$

3.63

 

 

$

0.50

 

 

$

4.13

 

 

$

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AUM (end of period)

$

9,495,993

 

 

$

7,317,949

 

 

$

2,178,044

 

 

$

9,007,411

 

 

$

488,582

 

Shares outstanding (end of period)

 

152,298,784

 

 

 

152,460,239

 

 

 

(161,455

)

 

 

152,635,930

 

 

 

(337,146

)

GAAP:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating margin

 

40.1

%

 

 

38.5

%

 

 

160

bps

 

 

35.1

%

 

 

500

bps

Effective tax rate

 

32.2

%

 

 

22.9

%

 

 

930

bps

 

 

20.9

%

 

 

1,130

bps

As adjusted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (1)

$

1,931

 

 

$

1,406

 

 

$

525

 

 

$

1,545

 

 

$

386

 

Operating margin (1)

 

44.9

%

 

 

43.7

%

 

 

120

bps

 

 

44.4

%

 

 

50

bps

Nonoperating income (expense), less net income

     (loss) attributable to noncontrolling interests (2)

$

101

 

 

$

169

 

 

$

(68

)

 

$

(28

)

 

$

129

 

Net income attributable to BlackRock, Inc. (3)

$

1,549

 

 

$

1,214

 

 

$

335

 

 

$

1,199

 

 

$

350

 

Diluted earnings attributable to BlackRock, Inc.

     common stockholders per share (3)

$

10.03

 

 

$

7.85

 

 

$

2.18

 

 

$

7.77

 

 

$

2.26

 

Effective tax rate

 

23.8

%

 

 

22.9

%

 

 

90

bps

 

 

20.9

%

 

 

290

bps

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See pages 11-12 for the reconciliation to GAAP and notes (1) through (3) for more information on as adjusted items.

 

 

 

 

 

 

 

 

3

 


 

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND SUPPLEMENTAL INFORMATION

(in millions, except shares and per share data), (unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

2021

 

 

2020

 

 

Change

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

Investment advisory, administration fees and

  securities lending revenue:

 

 

 

 

 

 

 

 

 

 

 

Investment advisory and administration fees

$

7,082

 

 

$

5,653

 

 

$

1,429

 

Securities lending revenue

 

267

 

 

 

368

 

 

 

(101

)

Total Investment advisory, administration fees and

  securities lending revenue

 

7,349

 

 

 

6,021

 

 

 

1,328

 

Investment advisory performance fees

 

469

 

 

 

153

 

 

 

316

 

Technology services revenue

 

622

 

 

 

552

 

 

 

70

 

Distribution fees

 

709

 

 

 

529

 

 

 

180

 

Advisory and other revenue

 

69

 

 

 

103

 

 

 

(34

)

Total revenue

 

9,218

 

 

 

7,358

 

 

 

1,860

 

 

 

 

 

 

 

 

 

 

 

 

 

Expense

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

2,957

 

 

 

2,289

 

 

 

668

 

Distribution and servicing costs

 

1,028

 

 

 

874

 

 

 

154

 

Direct fund expense

 

640

 

 

 

523

 

 

 

117

 

General and administration expense

 

1,046

 

 

 

1,530

 

 

 

(484

)

Amortization of intangible assets

 

71

 

 

 

52

 

 

 

19

 

Total expense

 

5,742

 

 

 

5,268

 

 

 

474

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

3,476

 

 

 

2,090

 

 

 

1,386

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonoperating income (expense)

 

 

 

 

 

 

 

 

 

 

 

Net gain (loss) on investments

 

396

 

 

 

358

 

 

 

38

 

Interest and dividend income

 

27

 

 

 

25

 

 

 

2

 

Interest expense

 

(107

)

 

 

(97

)

 

 

(10

)

Total nonoperating income (expense)

 

316

 

 

 

286

 

 

 

30

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

3,792

 

 

 

2,376

 

 

 

1,416

 

Income tax expense

 

972

 

 

 

347

 

 

 

625

 

Net income

 

2,820

 

 

 

2,029

 

 

 

791

 

Less:

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to noncontrolling

  interests

 

243

 

 

 

9

 

 

 

234

 

Net income attributable to BlackRock, Inc.

$

2,577

 

 

$

2,020

 

 

$

557

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding

 

 

 

 

 

 

 

 

 

 

 

Basic

 

152,504,902

 

 

 

154,488,079

 

 

 

(1,983,177

)

Diluted

 

154,359,353

 

 

 

155,556,187

 

 

 

(1,196,834

)

Earnings per share attributable to BlackRock, Inc.

   common stockholders

 

 

 

 

 

 

 

 

 

 

 

Basic

$

16.90

 

 

$

13.08

 

 

$

3.82

 

Diluted

$

16.69

 

 

$

12.99

 

 

$

3.70

 

Cash dividends declared and paid per share

$

8.26

 

 

$

7.26

 

 

$

1.00

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AUM (end of period)

$

9,495,993

 

 

$

7,317,949

 

 

$

2,178,044

 

Shares outstanding (end of period)

 

152,298,784

 

 

 

152,460,239

 

 

 

(161,455

)

GAAP:

 

 

 

 

 

 

 

 

 

 

 

Operating margin

 

37.7

%

 

 

28.4

%

 

 

930

bps

Effective tax rate

 

27.4

%

 

 

14.7

%

 

 

1,270

bps

As adjusted:

 

 

 

 

 

 

 

 

 

 

 

Operating income (1)

$

3,476

 

 

$

2,679

 

 

$

797

 

Operating margin (1)

 

44.7

%

 

 

42.7

%

 

 

200

bps

Nonoperating income (expense), less net income

     (loss) attributable to noncontrolling interests (2)

$

73

 

 

$

155

 

 

$

(82

)

Net income attributable to BlackRock, Inc. (3)

$

2,748

 

 

$

2,246

 

 

$

502

 

Diluted earnings attributable to BlackRock, Inc.

     common stockholders per share (3)

$

17.80

 

 

$

14.44

 

 

$

3.36

 

Effective tax rate

 

22.6

%

 

 

20.7

%

 

 

190

bps

 

 

 

 

 

 

 

 

 

 

 

 

See pages 11-12 for the reconciliation to GAAP and notes (1) through (3) for more information on as adjusted items.

 

4

 


 

 

ASSETS UNDER MANAGEMENT

(in millions), (unaudited)

 

Current Quarter Component Changes by Client Type and Product Type

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31,

 

 

inflows

 

 

Market

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

2021

 

 

(outflows)

 

 

change

 

 

FX impact (1)

 

 

2021

 

 

Average AUM(2)

 

Retail:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

$

407,715

 

 

$

9,866

 

 

$

28,643

 

 

$

103

 

 

$

446,327

 

 

$

431,075

 

Fixed income

 

349,640

 

 

 

6,689

 

 

 

2,480

 

 

 

671

 

 

 

359,480

 

 

 

355,500

 

Multi-asset

 

139,115

 

 

 

879

 

 

 

7,161

 

 

 

73

 

 

 

147,228

 

 

 

144,138

 

Alternatives

 

37,707

 

 

 

3,952

 

 

 

748

 

 

 

41

 

 

 

42,448

 

 

 

40,310

 

Retail subtotal

 

934,177

 

 

 

21,386

 

 

 

39,032

 

 

 

888

 

 

 

995,483

 

 

 

971,023

 

ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

2,077,818

 

 

 

51,376

 

 

 

126,762

 

 

 

1,872

 

 

 

2,257,828

 

 

 

2,186,497

 

Fixed income

 

667,829

 

 

 

21,710

 

 

 

9,639

 

 

 

831

 

 

 

700,009

 

 

 

686,205

 

Multi-asset

 

6,958

 

 

 

379

 

 

 

310

 

 

 

16

 

 

 

7,663

 

 

 

7,359

 

Alternatives

 

60,919

 

 

 

1,682

 

 

 

3,380

 

 

 

24

 

 

 

66,005

 

 

 

65,379

 

ETFs subtotal

 

2,813,524

 

 

 

75,147

 

 

 

140,091

 

 

 

2,743

 

 

 

3,031,505

 

 

 

2,945,440

 

Institutional:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Active:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

176,081

 

 

 

(3,958

)

 

 

11,876

 

 

 

175

 

 

 

184,174

 

 

 

181,046

 

Fixed income

 

692,474

 

 

 

9,058

 

 

 

14,558

 

 

 

581

 

 

 

716,671

 

 

 

706,642

 

Multi-asset

 

522,220

 

 

 

35,148

 

 

 

26,086

 

 

 

1,128

 

 

 

584,582

 

 

 

549,152

 

Alternatives

 

133,655

 

 

 

3,221

 

 

 

1,708

 

 

 

38

 

 

 

138,622

 

 

 

136,351

 

Active subtotal

 

1,524,430

 

 

 

43,469

 

 

 

54,228

 

 

 

1,922

 

 

 

1,624,049

 

 

 

1,573,191

 

Index:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

2,084,167

 

 

 

(83,737

)

 

 

143,764

 

 

 

1,868

 

 

 

2,146,062

 

 

 

2,127,456

 

Fixed income

 

910,517

 

 

 

3,833

 

 

 

21,230

 

 

 

425

 

 

 

936,005

 

 

 

931,252

 

Multi-asset

 

9,079

 

 

 

(269

)

 

 

500

 

 

 

(13

)

 

 

9,297

 

 

 

9,193

 

Alternatives

 

5,387

 

 

 

(125

)

 

 

451

 

 

 

(4

)

 

 

5,709

 

 

 

5,671

 

Index subtotal

 

3,009,150

 

 

 

(80,298

)

 

 

165,945

 

 

 

2,276

 

 

 

3,097,073

 

 

 

3,073,572

 

Institutional subtotal

 

4,533,580

 

 

 

(36,829

)

 

 

220,173

 

 

 

4,198

 

 

 

4,721,122

 

 

 

4,646,763

 

Long-term

 

8,281,281

 

 

 

59,704

 

 

 

399,296

 

 

 

7,829

 

 

 

8,748,110

 

 

 

8,563,226

 

Cash management

 

703,916

 

 

 

23,339

 

 

 

(84

)

 

 

432

 

 

 

727,603

 

 

 

732,270

 

Advisory(3)

 

22,214

 

 

 

(2,083

)

 

 

141

 

 

 

8

 

 

 

20,280

 

 

 

21,596

 

Total

$

9,007,411

 

 

$

80,960

 

 

$

399,353

 

 

$

8,269

 

 

$

9,495,993

 

 

$

9,317,092

 

Current Quarter Component Changes by Investment Style and Product Type (Long-Term)

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31,

 

 

inflows

 

 

Market

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

2021

 

 

(outflows)

 

 

change

 

 

FX impact (1)

 

 

2021

 

 

Average AUM(2)

 

Active:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

$

443,780

 

 

$

4,182

 

 

$

31,012

 

 

$

266

 

 

$

479,240

 

 

$

465,115

 

Fixed income

 

1,021,168

 

 

 

15,370

 

 

 

16,743

 

 

 

1,236

 

 

 

1,054,517

 

 

 

1,040,682

 

Multi-asset

 

661,333

 

 

 

36,026

 

 

 

33,246

 

 

 

1,201

 

 

 

731,806

 

 

 

693,285

 

Alternatives

 

171,361

 

 

 

7,172

 

 

 

2,457

 

 

 

79

 

 

 

181,069

 

 

 

176,660

 

Active subtotal

 

2,297,642

 

 

 

62,750

 

 

 

83,458

 

 

 

2,782

 

 

 

2,446,632

 

 

 

2,375,742

 

Index and ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

2,077,818

 

 

 

51,376

 

 

 

126,762

 

 

 

1,872

 

 

 

2,257,828

 

 

 

2,186,497

 

Fixed income

 

667,829

 

 

 

21,710

 

 

 

9,639

 

 

 

831

 

 

 

700,009

 

 

 

686,205

 

Multi-asset

 

6,958

 

 

 

379

 

 

 

310

 

 

 

16

 

 

 

7,663

 

 

 

7,359

 

Alternatives

 

60,919

 

 

 

1,682

 

 

 

3,380

 

 

 

24

 

 

 

66,005

 

 

 

65,379

 

ETFs subtotal

 

2,813,524

 

 

 

75,147

 

 

 

140,091

 

 

 

2,743

 

 

 

3,031,505

 

 

 

2,945,440

 

Non-ETF Index:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

2,224,183

 

 

 

(82,011

)

 

 

153,271

 

 

 

1,880

 

 

 

2,297,323

 

 

 

2,274,462

 

Fixed income

 

931,463

 

 

 

4,210

 

 

 

21,525

 

 

 

441

 

 

 

957,639

 

 

 

952,712

 

Multi-asset

 

9,081

 

 

 

(268

)

 

 

501

 

 

 

(13

)

 

 

9,301

 

 

 

9,198

 

Alternatives

 

5,388

 

 

 

(124

)

 

 

450

 

 

 

(4

)

 

 

5,710

 

 

 

5,672

 

Non-ETF Index subtotal

 

3,170,115

 

 

 

(78,193

)

 

 

175,747

 

 

 

2,304

 

 

 

3,269,973

 

 

 

3,242,044

 

Index and ETFs subtotal

 

5,983,639

 

 

 

(3,046

)

 

 

315,838

 

 

 

5,047

 

 

 

6,301,478

 

 

 

6,187,484

 

Long-term

$

8,281,281

 

 

$

59,704

 

 

$

399,296

 

 

$

7,829

 

 

$

8,748,110

 

 

$

8,563,226

 

Current Quarter Component Changes by Product Type (Long-Term)

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31,

 

 

inflows

 

 

Market

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

2021

 

 

(outflows)

 

 

change

 

 

FX impact (1)

 

 

2021

 

 

Average AUM(2)

 

Equity

$

4,745,781

 

 

$

(26,453

)

 

$

311,045

 

 

$

4,018

 

 

$

5,034,391

 

 

$

4,926,074

 

Fixed income

 

2,620,460

 

 

 

41,290

 

 

 

47,907

 

 

 

2,508

 

 

 

2,712,165

 

 

 

2,679,599

 

Multi-asset

 

677,372

 

 

 

36,137

 

 

 

34,057

 

 

 

1,204

 

 

 

748,770

 

 

 

709,842

 

Alternatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Illiquid alternatives

 

92,207

 

 

 

3,347

 

 

 

352

 

 

 

55

 

 

 

95,961

 

 

 

94,238

 

Liquid alternatives

 

76,266

 

 

 

3,319

 

 

 

1,945

 

 

 

30

 

 

 

81,560

 

 

 

79,138

 

Currency and commodities(4)

 

69,195

 

 

 

2,064

 

 

 

3,990

 

 

 

14

 

 

 

75,263

 

 

 

74,335

 

Alternatives subtotal

 

237,668

 

 

 

8,730

 

 

 

6,287

 

 

 

99

 

 

 

252,784

 

 

 

247,711

 

Long-term

$

8,281,281

 

 

$

59,704

 

 

$

399,296

 

 

$

7,829

 

 

$

8,748,110

 

 

$

8,563,226

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

(2)

Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing four months.

(3)

Advisory AUM represents mandates linked to purchases and disposition of assets and portfolios on behalf of official institutions and long-term portfolio liquidation assignments. Approximately $2.2 billion of ETFs AUM held in advisory accounts associated with the FRBNY assignment as of June 30, 2021 (disclosed via FRBNY reporting as of July 13, 2021) are included within Fixed Income ETFs AUM or Fixed Income AUM above. These holdings are excluded from Advisory AUM in the first table above.

(4)

Amounts include commodity ETFs.

 

5

 


 

 

ASSETS UNDER MANAGEMENT

(in millions), (unaudited)

Year-to-Date Component Changes by Client Type and Product Type

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

 

inflows

 

 

 

 

 

 

Market

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

2020

 

 

(outflows)

 

 

Acquisition(1)

 

 

change

 

 

FX impact(2)

 

 

2021

 

 

Average AUM(3)

 

Retail:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

$

338,434

 

 

$

24,199

 

 

$

41,324

 

 

$

43,286

 

 

$

(916

)

 

$

446,327

 

 

$

401,271

 

Fixed income

 

340,468

 

 

 

21,486

 

 

 

-

 

 

 

(1,300

)

 

 

(1,174

)

 

 

359,480

 

 

 

350,847

 

Multi-asset

 

132,624

 

 

 

4,874

 

 

 

-

 

 

 

9,837

 

 

 

(107

)

 

 

147,228

 

 

 

139,864

 

Alternatives

 

34,391

 

 

 

7,337

 

 

 

-

 

 

 

787

 

 

 

(67

)

 

 

42,448

 

 

 

38,207

 

Retail subtotal

 

845,917

 

 

 

57,896

 

 

 

41,324

 

 

 

52,610

 

 

 

(2,264

)

 

 

995,483

 

 

 

930,189

 

ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

1,905,101

 

 

 

117,798

 

 

 

-

 

 

 

238,644

 

 

 

(3,715

)

 

 

2,257,828

 

 

 

2,080,914

 

Fixed income

 

690,033

 

 

 

23,315

 

 

 

-

 

 

 

(11,332

)

 

 

(2,007

)

 

 

700,009

 

 

 

685,500

 

Multi-asset

 

6,268

 

 

 

945

 

 

 

-

 

 

 

420

 

 

 

30

 

 

 

7,663

 

 

 

6,948

 

Alternatives

 

67,605

 

 

 

1,578

 

 

 

-

 

 

 

(3,151

)

 

 

(27

)

 

 

66,005

 

 

 

66,467

 

ETFs subtotal

 

2,669,007

 

 

 

143,636

 

 

 

-

 

 

 

224,581

 

 

 

(5,719

)

 

 

3,031,505

 

 

 

2,839,829

 

Institutional:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Active:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

169,522

 

 

 

(3,491

)

 

 

-

 

 

 

18,964

 

 

 

(821

)

 

 

184,174

 

 

 

176,544

 

Fixed income

 

716,269

 

 

 

11,322

 

 

 

-

 

 

 

(7,836

)

 

 

(3,084

)

 

 

716,671

 

 

 

707,256

 

Multi-asset

 

511,242

 

 

 

43,631

 

 

 

-

 

 

 

32,733

 

 

 

(3,024

)

 

 

584,582

 

 

 

532,983

 

Alternatives

 

127,429

 

 

 

8,540

 

 

 

-

 

 

 

3,124

 

 

 

(471

)

 

 

138,622

 

 

 

133,087

 

Active subtotal

 

1,524,462

 

 

 

60,002

 

 

 

-

 

 

 

46,985

 

 

 

(7,400

)

 

 

1,624,049

 

 

 

1,549,870

 

Index:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

2,006,749

 

 

 

(115,099

)

 

 

-

 

 

 

264,295

 

 

 

(9,883

)

 

 

2,146,062

 

 

 

2,076,052

 

Fixed income

 

927,718

 

 

 

46,006

 

 

 

-

 

 

 

(25,587

)

 

 

(12,132

)

 

 

936,005

 

 

 

925,527

 

Multi-asset

 

8,599

 

 

 

439

 

 

 

-

 

 

 

499

 

 

 

(240

)

 

 

9,297

 

 

 

8,872

 

Alternatives

 

5,617

 

 

 

(538

)

 

 

-

 

 

 

685

 

 

 

(55

)

 

 

5,709

 

 

 

5,619

 

Index subtotal

 

2,948,683

 

 

 

(69,192

)

 

 

-

 

 

 

239,892

 

 

 

(22,310

)

 

 

3,097,073

 

 

 

3,016,070

 

Institutional subtotal

 

4,473,145

 

 

 

(9,190

)

 

 

-

 

 

 

286,877

 

 

 

(29,710

)

 

 

4,721,122

 

 

 

4,565,940

 

Long-term

 

7,988,069

 

 

 

192,342

 

 

 

41,324

 

 

 

564,068

 

 

 

(37,693

)

 

 

8,748,110

 

 

 

8,335,958

 

Cash management

 

666,252

 

 

 

62,529

 

 

 

-

 

 

 

(211

)

 

 

(967

)

 

 

727,603

 

 

 

697,856

 

Advisory(4)

 

22,359

 

 

 

(2,269

)

 

 

-

 

 

 

176

 

 

 

14

 

 

 

20,280

 

 

 

21,952

 

Total

$

8,676,680

 

 

$

252,602

 

 

$

41,324

 

 

$

564,033

 

 

$

(38,646

)

 

$

9,495,993

 

 

$

9,055,766

 

Year-to-Date Component Changes by Investment Style and Product Type (Long-Term)

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

 

inflows

 

 

 

 

 

 

Market

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

2020

 

 

(outflows)

 

 

Acquisition(1)

 

 

change

 

 

FX impact(2)

 

 

2021

 

 

Average AUM(3)

 

Active:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

$

410,189

 

 

$

25,202

 

 

$

-

 

 

$

45,605

 

 

$

(1,756

)

 

$

479,240

 

 

$

445,721

 

Fixed income

 

1,035,015

 

 

 

32,122

 

 

 

-

 

 

 

(8,317

)

 

 

(4,303

)

 

 

1,054,517

 

 

 

1,036,594

 

Multi-asset

 

643,864

 

 

 

48,504

 

 

 

-

 

 

 

42,569

 

 

 

(3,131

)

 

 

731,806

 

 

 

672,842

 

Alternatives

 

161,819

 

 

 

15,876

 

 

 

-

 

 

 

3,912

 

 

 

(538

)

 

 

181,069

 

 

 

171,293

 

Active subtotal

 

2,250,887

 

 

 

121,704

 

 

 

-

 

 

 

83,769

 

 

 

(9,728

)

 

 

2,446,632

 

 

 

2,326,450

 

Index and ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

1,905,101

 

 

 

117,798

 

 

 

-

 

 

 

238,644

 

 

 

(3,715

)

 

 

2,257,828

 

 

 

2,080,914

 

Fixed income

 

690,033

 

 

 

23,315

 

 

 

-

 

 

 

(11,332

)

 

 

(2,007

)

 

 

700,009

 

 

 

685,500

 

Multi-asset

 

6,268

 

 

 

945

 

 

 

-

 

 

 

420

 

 

 

30

 

 

 

7,663

 

 

 

6,948

 

Alternatives

 

67,605

 

 

 

1,578

 

 

 

-

 

 

 

(3,151

)

 

 

(27

)

 

 

66,005

 

 

 

66,467

 

ETFs subtotal

 

2,669,007

 

 

 

143,636

 

 

 

-

 

 

 

224,581

 

 

 

(5,719

)

 

 

3,031,505

 

 

 

2,839,829

 

Non-ETF Index:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

2,104,516

 

 

 

(119,593

)

 

 

41,324

 

 

 

280,940

 

 

 

(9,864

)

 

 

2,297,323

 

 

 

2,208,146

 

Fixed income

 

949,440

 

 

 

46,692

 

 

 

-

 

 

 

(26,406

)

 

 

(12,087

)

 

 

957,639

 

 

 

947,036

 

Multi-asset

 

8,601

 

 

 

440

 

 

 

-

 

 

 

500

 

 

 

(240

)

 

 

9,301

 

 

 

8,877

 

Alternatives

 

5,618

 

 

 

(537

)

 

 

-

 

 

 

684

 

 

 

(55

)

 

 

5,710

 

 

 

5,620

 

Non-ETF Index subtotal

 

3,068,175

 

 

 

(72,998

)

 

 

41,324

 

 

 

255,718

 

 

 

(22,246

)

 

 

3,269,973

 

 

 

3,169,679

 

Index and ETFs subtotal

 

5,737,182

 

 

 

70,638

 

 

 

41,324

 

 

 

480,299

 

 

 

(27,965

)

 

 

6,301,478

 

 

 

6,009,508

 

Long-term

$

7,988,069

 

 

$

192,342

 

 

$

41,324

 

 

$

564,068

 

 

$

(37,693

)

 

$

8,748,110

 

 

$

8,335,958

 

Year-to-Date Component Changes by Product Type (Long-Term)

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

 

inflows

 

 

 

 

 

 

Market

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

2020

 

 

(outflows)

 

 

Acquisition(1)

 

 

change

 

 

FX impact(2)

 

 

2021

 

 

Average AUM(3)

 

Equity

$

4,419,806

 

 

$

23,407

 

 

$

41,324

 

 

$

565,189

 

 

$

(15,335

)

 

$

5,034,391

 

 

$

4,734,781

 

Fixed income

 

2,674,488

 

 

 

102,129

 

 

 

-

 

 

 

(46,055

)

 

 

(18,397

)

 

 

2,712,165

 

 

 

2,669,130

 

Multi-asset

 

658,733

 

 

 

49,889

 

 

 

-

 

 

 

43,489

 

 

 

(3,341

)

 

 

748,770

 

 

 

688,667

 

Alternatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Illiquid alternatives

 

85,770

 

 

 

9,572

 

 

 

-

 

 

 

952

 

 

 

(333

)

 

 

95,961

 

 

 

90,987

 

Liquid alternatives

 

73,218

 

 

 

5,673

 

 

 

-

 

 

 

2,736

 

 

 

(67

)

 

 

81,560

 

 

 

77,169

 

Currency and commodities(5)

 

76,054

 

 

 

1,672

 

 

 

-

 

 

 

(2,243

)

 

 

(220

)

 

 

75,263

 

 

 

75,224

 

Alternatives subtotal

 

235,042

 

 

 

16,917

 

 

 

-

 

 

 

1,445

 

 

 

(620

)

 

 

252,784

 

 

 

243,380

 

Long-term

$

7,988,069

 

 

$

192,342

 

 

$

41,324

 

 

$

564,068

 

 

$

(37,693

)

 

$

8,748,110

 

 

$

8,335,958

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Amounts include AUM attributable to the acquisition of Aperio Group, LLC on February 1, 2021 (the “Aperio Transaction”).

(2)

Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

(3)

Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing seven months.

(4)

Advisory AUM represents mandates linked to purchases and disposition of assets and portfolios on behalf of official institutions and long-term portfolio liquidation assignments. Approximately $2.2 billion of ETFs AUM held in advisory accounts associated with the FRBNY assignment as of June 30, 2021 (disclosed via FRBNY reporting as of July 13, 2021) are included within Fixed Income ETFs AUM or Fixed Income AUM above. These holdings are excluded from Advisory AUM in the first table above.

(5)

Amounts include commodity ETFs.

 

6

 


 

 

ASSETS UNDER MANAGEMENT

(in millions), (unaudited)

Year-over-Year Component Changes by Client Type and Product Type

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

 

inflows

 

 

 

 

 

 

Market

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

2020

 

 

(outflows)

 

 

Acquisition(1)

 

 

change

 

 

FX impact(2)

 

 

2021

 

 

Average AUM(3)

 

Retail:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

$

254,104

 

 

$

47,302

 

 

$

41,324

 

 

$

97,009

 

 

$

6,588

 

 

$

446,327

 

 

$

345,277

 

Fixed income

 

301,160

 

 

 

44,028

 

 

 

-

 

 

 

9,401

 

 

 

4,891

 

 

 

359,480

 

 

 

334,847

 

Multi-asset

 

111,934

 

 

 

9,296

 

 

 

-

 

 

 

25,148

 

 

 

850

 

 

 

147,228

 

 

 

130,418

 

Alternatives

 

27,956

 

 

 

12,141

 

 

 

-

 

 

 

1,923

 

 

 

428

 

 

 

42,448

 

 

 

34,768

 

Retail subtotal

 

695,154

 

 

 

112,767

 

 

 

41,324

 

 

 

133,481

 

 

 

12,757

 

 

 

995,483

 

 

 

845,310

 

ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

1,470,314

 

 

 

197,907

 

 

 

-

 

 

 

578,981

 

 

 

10,626

 

 

 

2,257,828

 

 

 

1,858,812

 

Fixed income

 

634,098

 

 

 

56,540

 

 

 

-

 

 

 

2,637

 

 

 

6,734

 

 

 

700,009

 

 

 

675,322

 

Multi-asset

 

5,074

 

 

 

1,516

 

 

 

-

 

 

 

997

 

 

 

76

 

 

 

7,663

 

 

 

6,250

 

Alternatives

 

53,111

 

 

 

7,760

 

 

 

-

 

 

 

5,006

 

 

 

128

 

 

 

66,005

 

 

 

65,259

 

ETFs subtotal

 

2,162,597

 

 

 

263,723

 

 

 

-

 

 

 

587,621

 

 

 

17,564

 

 

 

3,031,505

 

 

 

2,605,643

 

Institutional:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Active:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

133,932

 

 

 

(2,308

)

 

 

-

 

 

 

49,350

 

 

 

3,200

 

 

 

184,174

 

 

 

163,639

 

Fixed income

 

666,693

 

 

 

26,849

 

 

 

-

 

 

 

14,142

 

 

 

8,987

 

 

 

716,671

 

 

 

698,882

 

Multi-asset

 

426,553

 

 

 

52,413

 

 

 

-

 

 

 

93,379

 

 

 

12,237

 

 

 

584,582

 

 

 

499,070

 

Alternatives

 

114,432

 

 

 

14,021

 

 

 

-

 

 

 

7,477

 

 

 

2,692

 

 

 

138,622

 

 

 

126,717

 

Active subtotal

 

1,341,610

 

 

 

90,975

 

 

 

-

 

 

 

164,348

 

 

 

27,116

 

 

 

1,624,049

 

 

 

1,488,308

 

Index:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

1,660,875

 

 

 

(169,247

)

 

 

-

 

 

 

623,656

 

 

 

30,778

 

 

 

2,146,062

 

 

 

1,937,458

 

Fixed income

 

809,141

 

 

 

107,780

 

 

 

-

 

 

 

(19,713

)

 

 

38,797

 

 

 

936,005

 

 

 

894,457

 

Multi-asset

 

7,801

 

 

 

242

 

 

 

-

 

 

 

1,296

 

 

 

(42

)

 

 

9,297

 

 

 

8,576

 

Alternatives

 

4,519

 

 

 

(94

)

 

 

-

 

 

 

1,176

 

 

 

108

 

 

 

5,709

 

 

 

5,244

 

Index subtotal

 

2,482,336

 

 

 

(61,319

)

 

 

-

 

 

 

606,415

 

 

 

69,641

 

 

 

3,097,073

 

 

 

2,845,735

 

Institutional subtotal

 

3,823,946

 

 

 

29,656

 

 

 

-

 

 

 

770,763

 

 

 

96,757

 

 

 

4,721,122

 

 

 

4,334,043

 

Long-term

 

6,681,697

 

 

 

406,146

 

 

 

41,324

 

 

 

1,491,865

 

 

 

127,078

 

 

 

8,748,110

 

 

 

7,784,996

 

Cash management

 

619,351

 

 

 

99,239

 

 

 

-

 

 

 

(157

)

 

 

9,170

 

 

 

727,603

 

 

 

673,619

 

Advisory(4)

 

16,901

 

 

 

2,853

 

 

 

-

 

 

 

479

 

 

 

47

 

 

 

20,280

 

 

 

20,975

 

Total

$

7,317,949

 

 

$

508,238

 

 

$

41,324

 

 

$

1,492,187

 

 

$

136,295

 

 

$

9,495,993

 

 

$

8,479,590

 

Year-over-Year Component Changes by Investment Style and Product Type (Long-Term)

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

 

inflows

 

 

 

 

 

 

Market

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

2020

 

 

(outflows)

 

 

Acquisition(1)

 

 

change

 

 

FX impact(2)

 

 

2021

 

 

Average AUM(3)

 

Active:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

$

312,809

 

 

$

43,888

 

 

$

-

 

 

$

116,600

 

 

$

5,943

 

 

$

479,240

 

 

$

400,020

 

Fixed income

 

950,143

 

 

 

68,072

 

 

 

-

 

 

 

23,910

 

 

 

12,392

 

 

 

1,054,517

 

 

 

1,013,129

 

Multi-asset

 

538,489

 

 

 

61,704

 

 

 

-

 

 

 

118,526

 

 

 

13,087

 

 

 

731,806

 

 

 

629,486

 

Alternatives

 

142,387

 

 

 

26,160

 

 

 

-

 

 

 

9,402

 

 

 

3,120

 

 

 

181,069

 

 

 

161,484

 

Active subtotal

 

1,943,828

 

 

 

199,824

 

 

 

-

 

 

 

268,438

 

 

 

34,542

 

 

 

2,446,632

 

 

 

2,204,119

 

Index and ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

1,470,314

 

 

 

197,907

 

 

 

-

 

 

 

578,981

 

 

 

10,626

 

 

 

2,257,828

 

 

 

1,858,812

 

Fixed income

 

634,098

 

 

 

56,540

 

 

 

-

 

 

 

2,637

 

 

 

6,734

 

 

 

700,009

 

 

 

675,322

 

Multi-asset

 

5,074

 

 

 

1,516

 

 

 

-

 

 

 

997

 

 

 

76

 

 

 

7,663

 

 

 

6,250

 

Alternatives

 

53,111

 

 

 

7,760

 

 

 

-

 

 

 

5,006

 

 

 

128

 

 

 

66,005

 

 

 

65,259

 

ETFs subtotal

 

2,162,597

 

 

 

263,723

 

 

 

-

 

 

 

587,621

 

 

 

17,564

 

 

 

3,031,505

 

 

 

2,605,643

 

Non-ETF Index:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

1,736,102

 

 

 

(168,141

)

 

 

41,324

 

 

 

653,415

 

 

 

34,623

 

 

 

2,297,323

 

 

 

2,046,354

 

Fixed income

 

826,851

 

 

 

110,585

 

 

 

-

 

 

 

(20,080

)

 

 

40,283

 

 

 

957,639

 

 

 

915,057

 

Multi-asset

 

7,799

 

 

 

247

 

 

 

-

 

 

 

1,297

 

 

 

(42

)

 

 

9,301

 

 

 

8,578

 

Alternatives

 

4,520

 

 

 

(92

)

 

 

-

 

 

 

1,174

 

 

 

108

 

 

 

5,710

 

 

 

5,245

 

Non-ETF Index subtotal

 

2,575,272

 

 

 

(57,401

)

 

 

41,324

 

 

 

635,806

 

 

 

74,972

 

 

 

3,269,973

 

 

 

2,975,234

 

Index and ETFs subtotal

 

4,737,869

 

 

 

206,322

 

 

 

41,324

 

 

 

1,223,427

 

 

 

92,536

 

 

 

6,301,478

 

 

 

5,580,877

 

Long-term

$

6,681,697

 

 

$

406,146

 

 

$

41,324

 

 

$

1,491,865

 

 

$

127,078

 

 

$

8,748,110

 

 

$

7,784,996

 

Year-over-Year Component Changes by Product Type (Long-Term)

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

June 30,

 

 

inflows

 

 

 

 

 

 

Market

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

2020

 

 

(outflows)

 

 

Acquisition(1)

 

 

change

 

 

FX impact(2)

 

 

2021

 

 

Average AUM(3)

 

Equity

$

3,519,225

 

 

$

73,654

 

 

$

41,324

 

 

$

1,348,996

 

 

$

51,192

 

 

$

5,034,391

 

 

$

4,305,186

 

Fixed income

 

2,411,092

 

 

 

235,197

 

 

 

-

 

 

 

6,467

 

 

 

59,409

 

 

 

2,712,165

 

 

 

2,603,508

 

Multi-asset

 

551,362

 

 

 

63,467

 

 

 

-

 

 

 

120,820

 

 

 

13,121

 

 

 

748,770

 

 

 

644,314

 

Alternatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Illiquid alternatives

 

76,607

 

 

 

16,303

 

 

 

-

 

 

 

1,570

 

 

 

1,481

 

 

 

95,961

 

 

 

85,690

 

Liquid alternatives

 

63,120

 

 

 

9,262

 

 

 

-

 

 

 

7,496

 

 

 

1,682

 

 

 

81,560

 

 

 

72,848

 

Currency and commodities(5)

 

60,291

 

 

 

8,263

 

 

 

-

 

 

 

6,516

 

 

 

193

 

 

 

75,263

 

 

 

73,450

 

Alternatives subtotal

 

200,018

 

 

 

33,828

 

 

 

-

 

 

 

15,582

 

 

 

3,356

 

 

 

252,784

 

 

 

231,988

 

Long-term

$

6,681,697

 

 

$

406,146

 

 

$

41,324

 

 

$

1,491,865

 

 

$

127,078

 

 

$

8,748,110

 

 

$

7,784,996

 

 

(1)

Amounts include AUM attributable to the Aperio Transaction.

(2)

Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

(3)

Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing thirteen months.

(4)

Advisory AUM represents mandates linked to purchases and disposition of assets and portfolios on behalf of official institutions and long-term portfolio liquidation assignments. Approximately $2.2 billion of ETFs AUM held in advisory accounts associated with the FRBNY assignment as of June 30, 2021 (disclosed via FRBNY reporting as of July 13, 2021) are included within Fixed Income ETFs AUM or Fixed Income AUM above. These holdings are excluded from Advisory AUM in the first table above.

(5)

Amounts include commodity ETFs.

 

 

7

 


 

 

SUMMARY OF REVENUE

 

Three Months

 

 

 

 

 

 

Three Months

 

 

 

 

 

 

Six Months

 

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

March 31,

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

(in millions), (unaudited)

2021

 

 

2020

 

 

Change

 

 

2021

 

 

Change

 

 

2021

 

 

2020

 

 

Change

 

 

Investment advisory, administration fees and

   securities lending revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Active

$

641

 

 

$

381

 

 

$

260

 

 

$

576

 

 

$

65

 

 

$

1,217

 

 

$

779

 

 

$

438

 

 

ETFs

 

1,156

 

 

 

792

 

 

 

364

 

 

 

1,068

 

 

 

88

 

 

 

2,224

 

 

 

1,671

 

 

 

553

 

 

Non-ETF Index

 

198

 

 

 

178

 

 

 

20

 

 

 

176

 

 

 

22

 

 

 

374

 

 

 

341

 

 

 

33

 

 

Equity subtotal

 

1,995

 

 

 

1,351

 

 

 

644

 

 

 

1,820

 

 

 

175

 

 

 

3,815

 

 

 

2,791

 

 

 

1,024

 

 

Fixed income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Active

 

545

 

 

 

464

 

 

 

81

 

 

 

525

 

 

 

20

 

 

 

1,070

 

 

 

945

 

 

 

125

 

 

ETFs

 

294

 

 

 

261

 

 

 

33

 

 

 

295

 

 

 

(1

)

 

 

589

 

 

 

520

 

 

 

69

 

 

Non-ETF Index

 

116

 

 

 

129

 

 

 

(13

)

 

 

113

 

 

 

3

 

 

 

229

 

 

 

241

 

 

 

(12

)

 

Fixed income subtotal

 

955

 

 

 

854

 

 

 

101

 

 

 

933

 

 

 

22

 

 

 

1,888

 

 

 

1,706

 

 

 

182

 

 

Multi-asset

 

344

 

 

 

270

 

 

 

74

 

 

 

328

 

 

 

16

 

 

 

672

 

 

 

563

 

 

 

109

 

 

Alternatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Illiquid alternatives

 

167

 

 

 

128

 

 

 

39

 

 

 

168

 

 

 

(1

)

 

 

335

 

 

 

276

 

 

 

59

 

 

Liquid alternatives

 

150

 

 

 

117

 

 

 

33

 

 

 

147

 

 

 

3

 

 

 

297

 

 

 

229

 

 

 

68

 

 

Currency and commodities

 

55

 

 

 

35

 

 

 

20

 

 

 

53

 

 

 

2

 

 

 

108

 

 

 

67

 

 

 

41

 

 

Alternatives subtotal

 

372

 

 

 

280

 

 

 

92

 

 

 

368

 

 

 

4

 

 

 

740

 

 

 

572

 

 

 

168

 

 

Long-term

 

3,666

 

 

 

2,755

 

 

 

911

 

 

 

3,449

 

 

 

217

 

 

 

7,115

 

 

 

5,632

 

 

 

1,483

 

 

Cash management

 

91

 

 

 

211

 

 

 

(120

)

 

 

143

 

 

 

(52

)

 

 

234

 

 

 

389

 

 

 

(155

)

 

Total investment advisory, administration fees

  and securities lending revenue

 

3,757

 

 

 

2,966

 

 

 

791

 

 

 

3,592

 

 

 

165

 

 

 

7,349

 

 

 

6,021

 

 

 

1,328

 

 

Investment advisory performance fees:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

36

 

 

 

23

 

 

 

13

 

 

 

26

 

 

 

10

 

 

 

62

 

 

 

25

 

 

 

37

 

 

Fixed income

 

15

 

 

 

2

 

 

 

13

 

 

 

14

 

 

 

1

 

 

 

29

 

 

 

4

 

 

 

25

 

 

Multi-asset

 

9

 

 

 

2

 

 

 

7

 

 

 

8

 

 

 

1

 

 

 

17

 

 

 

3

 

 

 

14

 

 

Alternatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Illiquid alternatives

 

90

 

 

 

32

 

 

 

58

 

 

 

7

 

 

 

83

 

 

 

97

 

 

 

49

 

 

 

48

 

 

Liquid alternatives

 

190

 

 

 

53

 

 

 

137

 

 

 

74

 

 

 

116

 

 

 

264

 

 

 

72

 

 

 

192

 

 

Alternatives subtotal

 

280

 

 

 

85

 

 

 

195

 

 

 

81

 

 

 

199

 

 

 

361

 

 

 

121

 

 

 

240

 

 

Total performance fees

 

340

 

 

 

112

 

 

 

228

 

 

 

129

 

 

 

211

 

 

 

469

 

 

 

153

 

 

 

316

 

 

Technology services revenue

 

316

 

 

 

278

 

 

 

38

 

 

 

306

 

 

 

10

 

 

 

622

 

 

 

552

 

 

 

70

 

 

Distribution fees:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retrocessions

 

264

 

 

 

162

 

 

 

102

 

 

 

238

 

 

 

26

 

 

 

502

 

 

 

331

 

 

 

171

 

 

12b-1 fees (US mutual fund distribution fees)

 

87

 

 

 

78

 

 

 

9

 

 

 

85

 

 

 

2

 

 

 

172

 

 

 

169

 

 

 

3

 

 

Other

 

18

 

 

 

13

 

 

 

5

 

 

 

17

 

 

 

1

 

 

 

35

 

 

 

29

 

 

 

6

 

 

Total distribution fees

 

369

 

 

 

253

 

 

 

116

 

 

 

340

 

 

 

29

 

 

 

709

 

 

 

529

 

 

 

180

 

 

Advisory and other revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advisory

 

9

 

 

 

17

 

 

 

(8

)

 

 

15

 

 

 

(6

)

 

 

24

 

 

 

34

 

 

 

(10

)

 

Other

 

29

 

 

 

22

 

 

 

7

 

 

 

16

 

 

 

13

 

 

 

45

 

 

 

69

 

 

 

(24

)

 

Total advisory and other revenue

 

38

 

 

 

39

 

 

 

(1

)

 

 

31

 

 

 

7

 

 

 

69

 

 

 

103

 

 

 

(34

)

 

Total revenue

$

4,820

 

 

$

3,648

 

 

$

1,172

 

 

$

4,398

 

 

$

422

 

 

$

9,218

 

 

$

7,358

 

 

$

1,860

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Highlights

Investment advisory, administration fees and securities lending revenue increased $791 million from the second quarter of 2020, primarily driven by the positive impact of market beta and foreign exchange movements on average AUM and strong organic base fee growth, partially offset by the impact of yield-related fee waivers on certain money market funds and strategic pricing changes to certain products, and lower securities lending revenue. Securities lending revenue of $140 million decreased from $210 million in the second quarter of 2020, primarily reflecting lower spreads, partially offset by higher average balances of securities on loan.

Investment advisory, administration fees and securities lending revenue increased $165 million from the first quarter of 2021, primarily driven by organic growth, the positive impact of market beta and foreign exchange movements on average AUM, and the effect of one additional day in the quarter, partially offset by higher yield-related fee waivers on certain money market funds. Securities lending revenue of $140 million increased from $127 million in the first quarter of 2021.

Performance fees increased $228 million from the second quarter of 2020 and $211 million from the first quarter of 2021, primarily reflecting higher revenue from liquid and illiquid alternative products.

Technology services revenue increased $38 million from the second quarter of 2020, primarily reflecting higher revenue from Aladdin®. Technology services annual contract value(1) (“ACV”) increased 16% from the second quarter of 2020.

 

 

(1)

ACV represents forward-looking recurring subscription fees under client contracts for the next twelve months at the end of a respective quarter, assuming all client contracts that come up for renewal are renewed. ACV excludes nonrecurring fees such as implementation and consulting fees. See note (4) in the supplemental information on page 12 for more information on ACV.

8

 


 

 

SUMMARY OF OPERATING EXPENSE

 

 

Three Months

 

 

 

 

 

 

Three Months

 

 

 

 

 

 

Six Months

 

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

March 31,

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

(in millions), (unaudited)

2021

 

 

2020

 

 

Change

 

 

2021

 

 

Change

 

 

2021

 

 

2020

 

 

Change

 

 

Operating expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

$

1,548

 

 

$

1,152

 

 

$

396

 

 

$

1,409

 

 

$

139

 

 

$

2,957

 

 

$

2,289

 

 

$

668

 

 

Distribution and servicing costs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retrocessions

 

264

 

 

 

162

 

 

 

102

 

 

 

238

 

 

 

26

 

 

 

502

 

 

 

331

 

 

 

171

 

 

12b-1 costs

 

85

 

 

 

75

 

 

 

10

 

 

 

83

 

 

 

2

 

 

 

168

 

 

 

164

 

 

 

4

 

 

Other

 

174

 

 

 

192

 

 

 

(18

)

 

 

184

 

 

 

(10

)

 

 

358

 

 

 

379

 

 

 

(21

)

 

Total distribution and servicing costs

 

523

 

 

 

429

 

 

 

94

 

 

 

505

 

 

 

18

 

 

 

1,028

 

 

 

874

 

 

 

154

 

 

Direct fund expense

 

320

 

 

 

246

 

 

 

74

 

 

 

320

 

 

 

-

 

 

 

640

 

 

 

523

 

 

 

117

 

 

General and administration expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Marketing and promotional

 

53

 

 

 

39

 

 

 

14

 

 

 

35

 

 

 

18

 

 

 

88

 

 

 

108

 

 

 

(20

)

 

Occupancy and office related

 

80

 

 

 

80

 

 

 

-

 

 

 

79

 

 

 

1

 

 

 

159

 

 

 

158

 

 

 

1

 

 

Portfolio services

 

87

 

 

 

65

 

 

 

22

 

 

 

87

 

 

 

-

 

 

 

174

 

 

 

130

 

 

 

44

 

 

Technology

 

129

 

 

 

92

 

 

 

37

 

 

 

104

 

 

 

25

 

 

 

233

 

 

 

180

 

 

 

53

 

 

Professional services

 

41

 

 

 

41

 

 

 

-

 

 

 

39

 

 

 

2

 

 

 

80

 

 

 

85

 

 

 

(5

)

 

Communications

 

11

 

 

 

14

 

 

 

(3

)

 

 

11

 

 

 

-

 

 

 

22

 

 

 

26

 

 

 

(4

)

 

Foreign exchange remeasurement

 

(2

)

 

 

1

 

 

 

(3

)

 

 

4

 

 

 

(6

)

 

 

2

 

 

 

6

 

 

 

(4

)

 

Contingent consideration fair value adjustments

 

1

 

 

 

(2

)

 

 

3

 

 

 

3

 

 

 

(2

)

 

 

4

 

 

 

23

 

 

 

(19

)

 

Product launch costs

 

-

 

 

 

-

 

 

 

-

 

 

 

178

 

 

 

(178

)

 

 

178

 

 

 

84

 

 

 

94

 

 

Charitable Contribution

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

589

 

 

 

(589

)

 

Other general and administration

 

61

 

 

 

58

 

 

 

3

 

 

 

45

 

 

 

16

 

 

 

106

 

 

 

141

 

 

 

(35

)

 

Total general and administration expense

 

461

 

 

 

388

 

 

 

73

 

 

 

585

 

 

 

(124

)

 

 

1,046

 

 

 

1,530

 

 

 

(484

)

 

Amortization of intangible assets

 

37

 

 

 

27

 

 

 

10

 

 

 

34

 

 

 

3

 

 

 

71

 

 

 

52

 

 

 

19

 

 

Total operating expense

$

2,889

 

 

$

2,242

 

 

$

647

 

 

$

2,853

 

 

$

36

 

 

$

5,742

 

 

$

5,268

 

 

$

474

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Highlights

Employee compensation and benefits expense increased $396 million from the second quarter of 2020, primarily reflecting higher incentive compensation, driven by higher operating income and performance fees, and higher deferred compensation, reflecting the impact of additional grants associated with prior-year compensation and certain previous acquisition-related compensation arrangements.

Employee compensation and benefits expense increased $139 million from the first quarter of 2021, primarily reflecting higher incentive compensation, driven in part by higher performance fees, partially offset by lower seasonal payroll taxes in the current quarter.

Direct fund expense increased $74 million from the second quarter of 2020, primarily reflecting higher average AUM.

General and administration expense increased $73 million from the second quarter of 2020, largely driven by higher technology, portfolio services, and marketing and promotional expense.

General and administration expense decreased $124 million from the first quarter of 2021, primarily driven by $178 million of product launch costs incurred in the first quarter of 2021, partially offset by higher technology and marketing and promotional expense.

Amortization of intangible assets expense increased $10 million from the second quarter of 2020, primarily reflecting amortization of intangible assets related to the Aperio Transaction.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

9

 


 

 

SUMMARY OF NONOPERATING INCOME (expense), less net income (loss) attributable TO noncontrolling interests

 

 

 

 

Three Months

 

 

 

 

 

 

Three Months

 

 

 

 

 

 

Six Months

 

 

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

March 31,

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

(in millions), (unaudited)

 

2021

 

 

2020

 

 

Change

 

 

2021

 

 

Change

 

 

2021

 

 

2020

 

 

Change

 

 

Nonoperating income (expense), GAAP basis

 

$

270

 

 

$

357

 

 

$

(87

)

 

$

46

 

 

$

224

 

 

$

316

 

 

$

286

 

 

$

30

 

 

Less: Net income (loss) attributable to

     noncontrolling interests ("NCI")

 

 

169

 

 

 

188

 

 

 

(19

)

 

 

74

 

 

 

95

 

 

 

243

 

 

 

9

 

 

 

234

 

 

Nonoperating income (expense)(1)

 

$

101

 

 

$

169

 

 

$

(68

)

 

$

(28

)

 

$

129

 

 

$

73

 

 

$

277

 

 

$

(204

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months

 

 

 

 

 

 

Three Months

 

 

 

 

 

 

Six Months

 

 

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

March 31,

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

(in millions), (unaudited)

 

2021

 

 

2020

 

 

Change

 

 

2021

 

 

Change

 

 

2021

 

 

2020

 

 

Change

 

 

Net gain (loss) on investments(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Private equity

 

$

66

 

 

$

8

 

 

$

58

 

 

$

22

 

 

$

44

 

 

$

88

 

 

$

(10

)

 

$

98

 

 

Real assets

 

 

3

 

 

 

-

 

 

 

3

 

 

 

3

 

 

 

-

 

 

 

6

 

 

 

5

 

 

 

1

 

 

Other alternatives(2)

 

 

17

 

 

 

21

 

 

 

(4

)

 

 

13

 

 

 

4

 

 

 

30

 

 

 

(4

)

 

 

34

 

 

Other investments(3)

 

 

48

 

 

 

130

 

 

 

(82

)

 

 

(3

)

 

 

51

 

 

 

45

 

 

 

(20

)

 

 

65

 

 

Subtotal

 

 

134

 

 

 

159

 

 

 

(25

)

 

 

35

 

 

 

99

 

 

 

169

 

 

 

(29

)

 

 

198

 

 

Gain related to the Charitable Contribution

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

122

 

 

 

(122

)

 

Other gains (losses)(4)

 

 

11

 

 

 

51

 

 

 

(40

)

 

 

(27

)

 

 

38

 

 

 

(16

)

 

 

256

 

 

 

(272

)

 

Total net gain (loss) on investments(1)

 

 

145

 

 

 

210

 

 

 

(65

)

 

 

8

 

 

 

137

 

 

 

153

 

 

 

349

 

 

 

(196

)

 

Interest and dividend income

 

 

8

 

 

 

10

 

 

 

(2

)

 

 

19

 

 

 

(11

)

 

 

27

 

 

 

25

 

 

 

2

 

 

Interest expense

 

 

(52

)

 

 

(51

)

 

 

(1

)

 

 

(55

)

 

 

3

 

 

 

(107

)

 

 

(97

)

 

 

(10

)

 

Net interest expense

 

 

(44

)

 

 

(41

)

 

 

(3

)

 

 

(36

)

 

 

(8

)

 

 

(80

)

 

 

(72

)

 

 

(8

)

 

Nonoperating income (expense)(1)

 

$

101

 

 

$

169

 

 

$

(68

)

 

$

(28

)

 

$

129

 

 

$

73

 

 

$

277

 

 

$

(204

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Net of net income (loss) attributable to NCI. Management believes nonoperating income (expense), as adjusted, is an effective measure for reviewing BlackRock’s nonoperating results, which ultimately impacts BlackRock’s book value. For more information on as adjusted items and the reconciliation to GAAP see note (2) to the condensed consolidated statements of income and supplemental information on pages 11 and 12.

(2)

Amounts primarily include net gains (losses) related to direct hedge fund strategies and hedge fund solutions.

(3)

Amounts primarily include net gains (losses) related to unhedged equity, fixed income and multi-asset investments.

(4)

The amount for the six months ended June 30, 2020 includes a nonoperating pre-tax gain of approximately $240 million in connection with a recapitalization of iCapital Network, Inc. Additional amounts include noncash pre-tax gains (losses) related to the revaluation of certain other corporate minority investments.

 

 

INCOME TAX EXPENSE

 

 

Three Months

 

 

 

 

 

Three Months

 

 

 

 

 

 

Six Months

 

 

 

 

 

 

 

Ended

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

 

June 30,

 

 

 

 

 

March 31,

 

 

 

 

 

 

June 30,

 

 

 

 

 

 

(in millions), (unaudited)

2021

 

 

2020

 

 

Change

 

2021

 

 

Change

 

 

2021

 

 

2020

 

 

Change

 

 

Income tax expense

$

654

 

 

$

361

 

 

$

293

 

 

$

318

 

 

$

336

 

 

$

972

 

 

$

347

 

 

$

625

 

 

Effective tax rate

 

32.2

%

 

 

22.9

%

 

 

930

bps

 

 

20.9

%

 

 

1,130

bps

 

 

27.4

%

 

 

14.7

%

 

 

1,270

bps

 

 

Highlights

Second quarter 2021 tax expense included $171 million of noncash net expense related to the revaluation of certain deferred tax assets and liabilities as a result of legislation enacted in the United Kingdom increasing its corporate tax rate.

First quarter 2021 income tax expense included $39 million of discrete tax benefit related to stock-based compensation awards that vested in the first quarter of 2021.

 

 

10

 


 

 

RECONCILIATION OF US GAAP OPERATING INCOME AND OPERATING MARGIN TO OPERATING INCOME AND OPERATING MARGIN, AS ADJUSTED

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

 

June 30,

 

 

March 31,

 

 

June 30,

 

 

(in millions), (unaudited)

 

2021

 

 

2020

 

 

2021

 

 

2021

 

 

2020

 

 

Operating income, GAAP basis

 

$

1,931

 

 

$

1,406

 

 

$

1,545

 

 

$

3,476

 

 

$

2,090

 

 

Non-GAAP expense adjustment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Charitable Contribution

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

589

 

 

Operating income, as adjusted (1)

 

 

1,931

 

 

 

1,406

 

 

 

1,545

 

 

 

3,476

 

 

 

2,679

 

 

Product launch costs and commissions

 

 

-

 

 

 

-

 

 

 

185

 

 

 

185

 

 

 

87

 

 

Operating income used for operating margin measurement

 

$

1,931

 

 

$

1,406

 

 

$

1,730

 

 

$

3,661

 

 

$

2,766

 

 

Revenue, GAAP basis

 

$

4,820

 

 

$

3,648

 

 

$

4,398

 

 

$

9,218

 

 

$

7,358

 

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Distribution fees

 

 

(369

)

 

 

(253

)

 

 

(340

)

 

 

(709

)

 

 

(529

)

 

Investment advisory fees

 

 

(154

)

 

 

(176

)

 

 

(165

)

 

 

(319

)

 

 

(345

)

 

Revenue used for operating margin measurement

 

$

4,297

 

 

$

3,219

 

 

$

3,893

 

 

$

8,190

 

 

$

6,484

 

 

Operating margin, GAAP basis

 

 

40.1

%

 

 

38.5

%

 

 

35.1

%

 

 

37.7

%

 

 

28.4

%

 

Operating margin, as adjusted (1)

 

 

44.9

%

 

 

43.7

%

 

 

44.4

%

 

 

44.7

%

 

 

42.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See note (1) to the condensed consolidated statements of income and supplemental information on page 12 for more information on as adjusted items and the reconciliation to GAAP.

 

RECONCILIATION OF US GAAP NONOPERATING INCOME (EXPENSE) TO NONOPERATING INCOME (EXPENSE), LESS NET INCOME (LOSS) ATTRIBUTABLE TO NCI, AS ADJUSTED

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

 

June 30,

 

 

March 31,

 

 

June 30,

 

 

(in millions), (unaudited)

 

2021

 

 

2020

 

 

2021

 

 

2021

 

 

2020

 

 

Nonoperating income (expense), GAAP basis

 

$

270

 

 

$

357

 

 

$

46

 

 

$

316

 

 

$

286

 

 

Less: Net income (loss) attributable to NCI

 

 

169

 

 

 

188

 

 

 

74

 

 

 

243

 

 

 

9

 

 

Nonoperating income (expense), net of NCI

 

 

101

 

 

 

169

 

 

 

(28

)

 

 

73

 

 

 

277

 

 

Less: Gain related to the Charitable Contribution

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

122

 

 

Nonoperating income (expense), less net income (loss)

   attributable to NCI, as adjusted (2)

 

$

101

 

 

$

169

 

 

$

(28

)

 

$

73

 

 

$

155

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See note (2) to the condensed consolidated statements of income and supplemental information on page 12 for more information on as adjusted items and the reconciliation to GAAP.

 

RECONCILIATION OF US GAAP NET INCOME ATTRIBUTABLE TO BLACKROCK TO NET INCOME ATTRIBUTABLE TO BLACKROCK, AS ADJUSTED

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

 

June 30,

 

 

March 31,

 

 

June 30,

 

 

(in millions, except per share data), (unaudited)

 

2021

 

 

2020

 

 

2021

 

 

2021

 

 

2020

 

 

Net income attributable to BlackRock, Inc., GAAP basis

 

$

1,378

 

 

$

1,214

 

 

$

1,199

 

 

$

2,577

 

 

$

2,020

 

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Charitable Contribution, net of tax

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

226

 

 

Income tax matters

 

 

171

 

 

 

-

 

 

 

-

 

 

 

171

 

 

 

-

 

 

Net income attributable to BlackRock, Inc., as adjusted (3)

 

$

1,549

 

 

$

1,214

 

 

$

1,199

 

 

$

2,748

 

 

$

2,246

 

 

Diluted weighted-average common shares outstanding

 

 

154.4

 

 

 

154.7

 

 

 

154.3

 

 

 

154.4

 

 

 

155.6

 

 

Diluted earnings per common share, GAAP basis

 

$

8.92

 

 

$

7.85

 

 

$

7.77

 

 

$

16.69

 

 

$

12.99

 

 

Diluted earnings per common share, as adjusted (3)

 

$

10.03

 

 

$

7.85

 

 

$

7.77

 

 

$

17.80

 

 

$

14.44

 

 

 

See note (3) to the condensed consolidated statements of income and supplemental information on page 12 for more information on as adjusted items and the reconciliation to GAAP.

NOTES TO CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND SUPPLEMENTAL INFORMATION (unaudited)

 

BlackRock reports its financial results in accordance with accounting principles generally accepted in the United States (“GAAP”); however, management believes evaluating the Company’s ongoing operating results may be enhanced if investors have additional non-GAAP financial measures. Management reviews non-GAAP financial measures to assess ongoing operations and considers them to be helpful, for both management and investors, in evaluating BlackRock’s financial performance over time. Management also uses non-GAAP financial measures as a benchmark to compare its performance with other companies and to enhance the comparability of this information for the reporting periods presented. Non-GAAP measures may pose limitations because they do not include all of BlackRock’s revenue and expense. BlackRock’s management does not advocate that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Non-GAAP measures may not be comparable to other similarly titled measures of other companies.

11

 


 

Management uses both GAAP and non-GAAP financial measures in evaluating BlackRock’s financial performance.  Adjustments to GAAP financial measures (“non-GAAP adjustments”) include certain items management deems nonrecurring or that occur infrequently, transactions that ultimately will not impact BlackRock’s book value or certain tax items that do not impact cash flow.

Computations for all periods are derived from the condensed consolidated statements of income as follows:

(1) Operating income, as adjusted, and operating margin, as adjusted: Management believes operating income, as adjusted, and operating margin, as adjusted, are effective indicators of BlackRock’s financial performance over time, and, therefore, provide useful disclosure to investors. Management believes that operating margin, as adjusted, reflects the Company’s long-term ability to manage ongoing costs in relation to its revenues. The Company uses operating margin, as adjusted, to assess the Company’s financial performance and to determine the long-term and annual compensation of the Company’s senior-level employees. Furthermore, this metric is used to evaluate the Company’s relative performance against industry peers, as it eliminates margin variability arising from the accounting of revenues and expenses related to distributing different product structures in multiple distribution channels utilized by asset managers.

Operating income, as adjusted, includes a non-GAAP expense adjustment. During the six months ended June 30, 2020, the Company contributed its remaining 20% stake in PennyMac Financial Services, Inc. (the “Charitable Contribution”). The Charitable Contribution expense of $589 million has been excluded from operating income, as adjusted, due to its nonrecurring nature.

Operating income used for measuring operating margin, as adjusted, is equal to operating income, as adjusted, excluding the impact of product launch costs (e.g. closed-end fund launch costs) and related commissions. Management believes the exclusion of such costs and related commissions is useful because these costs can fluctuate considerably and revenue associated with the expenditure of these costs will not fully impact BlackRock’s results until future periods.

Revenue used for calculating operating margin, as adjusted, is reduced to exclude all of the Company’s distribution fees, which are recorded as a separate line item on the condensed consolidated statements of income, as well as a portion of investment advisory fees received that is used to pay distribution and servicing costs. For certain products, based on distinct arrangements, distribution fees are collected by the Company and then passed-through to third-party client intermediaries. For other products, investment advisory fees are collected by the Company and a portion is passed-through to third-party client intermediaries. However, in both structures, the third-party client intermediary similarly owns the relationship with the retail client and is responsible for distributing the product and servicing the client. The amount of distribution and investment advisory fees fluctuates each period primarily based on a predetermined percentage of the value of AUM during the period. These fees also vary based on the type of investment product sold and the geographic location where it is sold. In addition, the Company may waive fees on certain products that could result in the reduction of payments to the third-party intermediaries.

(2) Nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted: Management believes nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, is an effective measure for reviewing BlackRock’s nonoperating contribution to its results and provides comparability of this information among reporting periods.  Management believes nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, provides a useful measure, for both management and investors, of BlackRock’s nonoperating results, which ultimately impact BlackRock’s book value. During the six months ended June 30, 2020, the noncash, nonoperating pre-tax gain of $122 million related to the Charitable Contribution has been excluded from nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, due to its nonrecurring nature.

(3) Net income attributable to BlackRock, Inc., as adjusted: Management believes net income attributable to BlackRock, Inc., as adjusted, and diluted earnings per common share, as adjusted, are useful measures of BlackRock’s profitability and financial performance. Net income attributable to BlackRock, Inc., as adjusted, equals net income attributable to BlackRock, Inc., GAAP basis, adjusted for significant nonrecurring items, charges that ultimately will not impact BlackRock’s book value or certain tax items that do not impact cash flow.

See aforementioned discussion regarding operating income, as adjusted, operating margin, as adjusted, and nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, for information on the Charitable Contribution.

The six months ended June 30, 2020 included a discrete tax benefit of $241 million that was recognized in connection with the Charitable Contribution. The discrete tax benefit has been excluded from as adjusted results due to the nonrecurring nature of the Charitable Contribution. Amounts for income tax matters represent net noncash (benefits) expense primarily associated with the revaluation of certain deferred tax liabilities related to intangible assets and goodwill as a result of tax rate changes. These amounts have been excluded from the as adjusted results as these items will not have a cash flow impact and to ensure comparability among periods presented.

Per share amounts reflect net income attributable to BlackRock, Inc., as adjusted divided by diluted weighted-average common shares outstanding.

(4) ACV: Management believes ACV is an effective metric for reviewing BlackRock’s technology services’ ongoing contribution to its operating results and provides comparability of this information among reporting periods while also providing a useful supplemental metric for both management and investors of BlackRock’s growth in technology services revenue over time, as it is linked to the net new business in technology services.


12

 


 

FORWARD-LOOKING STATEMENTS

 

This earnings release, and other statements that BlackRock may make, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act, with respect to BlackRock’s future financial or business performance, strategies or expectations. Forward-looking statements are typically identified by words or phrases such as “trend,” “potential,” “opportunity,” “pipeline,” “believe,” “comfortable,” “expect,” “anticipate,” “current,” “intention,” “estimate,” “position,” “assume,” “outlook,” “continue,” “remain,” “maintain,” “sustain,” “seek,” “achieve,” and similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could,” “may” and similar expressions.

BlackRock cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made, and BlackRock assumes no duty to and does not undertake to update forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance.

BlackRock has previously disclosed risk factors in its Securities and Exchange Commission (“SEC”) reports. These risk factors and those identified elsewhere in this earnings release, among others, could cause actual results to differ materially from forward-looking statements or historical performance and include: (1) a pandemic or health crisis, including the COVID-19 pandemic, and its continued impact on financial institutions, the global economy or capital markets, as well as BlackRock’s products, clients, vendors and employees, and BlackRock’s results of operations, the full extent of which may be unknown; (2) the introduction, withdrawal, success and timing of business initiatives and strategies; (3) changes and volatility in political, economic or industry conditions, the interest rate environment, foreign exchange rates or financial and capital markets, which could result in changes in demand for products or services or in the value of assets under management (“AUM”); (4) the relative and absolute investment performance of BlackRock’s investment products; (5) BlackRock’s ability to develop new products and services that address client preferences; (6) the impact of increased competition; (7) the impact of future acquisitions or divestitures; (8) BlackRock’s ability to integrate acquired businesses successfully; (9) the unfavorable resolution of legal proceedings; (10) the extent and timing of any share repurchases; (11) the impact, extent and timing of technological changes and the adequacy of intellectual property, information and cyber security protection; (12) attempts to circumvent BlackRock’s operational control environment or the potential for human error in connection with BlackRock’s operational systems; (13) the impact of legislative and regulatory actions and reforms and regulatory, supervisory or enforcement actions of government agencies relating to BlackRock; (14) changes in law and policy and uncertainty pending any such changes; (15) any failure to effectively manage conflicts of interest; (16) damage to BlackRock’s reputation; (17) terrorist activities, civil unrest, international hostilities and natural disasters, which may adversely affect the general economy, domestic and local financial and capital markets, specific industries or BlackRock; (18) the ability to attract and retain highly talented professionals; (19) fluctuations in the carrying value of BlackRock’s economic investments; (20) the impact of changes to tax legislation, including income, payroll and transaction taxes, and taxation on products or transactions, which could affect the value proposition to clients and, generally, the tax position of the Company; (21) BlackRock’s success in negotiating distribution arrangements and maintaining distribution channels for its products; (22) the failure by a key vendor of BlackRock to fulfill its obligations to the Company; (23) operational, technological and regulatory risks associated with BlackRock’s major technology partnerships; (24) any disruption to the operations of third parties whose functions are integral to BlackRock’s exchange-traded funds platform; (25) the impact of BlackRock electing to provide support to its products from time to time and any potential liabilities related to securities lending or other indemnification obligations; and (26) the impact of problems at other financial institutions or the failure or negative performance of products at other financial institutions.

BlackRock’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and BlackRock’s subsequent filings with the SEC, accessible on the SEC’s website at www.sec.gov and on BlackRock’s website at www.blackrock.com, discuss these factors in more detail and identify additional factors that can affect forward-looking statements. The information contained on the Company’s website is not a part of this earnings release.

PERFORMANCE NOTES

 

Past performance is not indicative of future results. Except as specified, the performance information shown is as of June 30, 2021 and is based on preliminary data available at that time. The performance data shown reflects information for all actively and passively managed equity and fixed income accounts, including US registered investment companies, European-domiciled retail funds and separate accounts for which performance data is available, including performance data for high net worth accounts available as of May 31, 2021. The performance data does not include accounts terminated prior to June 30, 2021 and accounts for which data has not yet been verified. If such accounts had been included, the performance data provided may have substantially differed from that shown.

Performance comparisons shown are gross-of-fees for institutional and high net worth separate accounts, and net-of-fees for retail funds. The performance tracking shown for index accounts is based on gross-of-fees performance and includes all institutional accounts and all iShares® funds globally using an index strategy. AUM information is based on AUM available as of June 30, 2021 for each account or fund in the asset class shown without adjustment for overlapping management of the same account or fund. Fund performance reflects the reinvestment of dividends and distributions.

Performance shown is derived from applicable benchmarks or peer median information, as selected by BlackRock, Inc. Peer medians are based in part on data either from Lipper, Inc. or Morningstar, Inc. for each included product.

13