UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934.

For the quarterly period ended September 30, ~~2017~~2021

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934.

For the transition period from to .

Commission file number 001-33099

BlackRock, Inc.

(Exact name of registrant as specified in its charter)

Delaware

32-0174431

(State or Other Jurisdiction of

Incorporation or Organization)

~~(I.R.S.~~(I.R.S. Employer Identification No.)

55 East 52nd Street, New York, NY 10055

(Address of Principal Executive Offices)

(Zip Code)

(212) 810-5300

(Registrant’s Telephone Number, Including Area Code)

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.01 par value	BLK	New York Stock Exchange
1.250% Notes due 2025	BLK25	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes

Indicate by check mark whether the registrant has submitted electronically, ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files).

Yes

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer☒ ~~Accelerated filer~~ ☐

~~Non-accelerated filer (Do not check if a smaller reporting company)~~☐

~~Smaller reporting company~~☐

~~Emerging growth company~~ ☐

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes

As of October 31, ~~2017,~~2021, there were ~~160,332,161~~151,917,177 shares of the registrant’s common stock outstanding.

BlackRock, Inc.

Index to Form 10-Q

PART I

FINANCIAL INFORMATION

		Page

Item 1.	Financial Statements (unaudited)

	Condensed Consolidated Statements of Financial Condition	1

	Condensed Consolidated Statements of Income	2

	Condensed Consolidated Statements of Comprehensive Income	3

	Condensed Consolidated Statements of Changes in Equity	4

	Condensed Consolidated Statements of Cash Flows	6

	Notes to Condensed Consolidated Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3439

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	6575

Item 4.	Controls and Procedures	6676

PART II

OTHER INFORMATION

Item 1.	Legal Proceedings	6777

Item 1A.	Risk Factors	78

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	6979

Item 6.	Exhibits	7080

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

BlackRock, Inc.

Condensed Consolidated Statements of Financial Condition

(unaudited)

	September 30,			December 31,			September 30,			December 31,
(in millions, except shares and per share data)	2017			2016			2021			2020
Assets
Cash and cash equivalents(1)	$	6,165		$	6,091		$	7,361		$	8,664
Accounts receivable		3,183			2,350			4,015			3,535
Investments(1)		1,928			1,595			7,101			6,919
Assets of consolidated variable interest entities:
Cash and cash equivalents		82			84
Investments		1,286			1,008
Other assets		46			63
Separate account assets		147,938			149,089			96,755			104,663
Separate account collateral held under securities lending agreements		27,431			27,792			14,106			16,507
Property and equipment (net of accumulated depreciation of $708 and $601 at September 30, 2017 and December 31, 2016, respectively)		571			559
Intangible assets (net of accumulated amortization of $909 and $832 at September 30, 2017 and December 31, 2016, respectively)		17,400			17,363
Property and equipment (net of accumulated depreciation and amortization of $1,257 and $1,098 at September 30, 2021 and December 31, 2020, respectively)								703			681
Intangible assets (net of accumulated amortization of $389 and $291 at September 30, 2021 and December 31, 2020, respectively)								18,476			18,263
Goodwill		13,226			13,118			15,360			14,551
Other assets		1,311			1,065
Operating lease right-of-use assets								1,798			649
Other assets⁽¹⁾								3,961			2,550
Total assets	$	220,567		$	220,177		$	169,636		$	176,982
Liabilities
Accrued compensation and benefits	$	1,614		$	1,880		$	2,343		$	2,499
Accounts payable and accrued liabilities		1,652			1,094			1,402			1,028
Liabilities of consolidated variable interest entities		319			216
Borrowings		5,000			4,915			6,474			7,264
Separate account liabilities		147,938			149,089			96,755			104,663
Separate account collateral liabilities under securities lending agreements		27,431			27,792			14,106			16,507
Deferred income tax liabilities		4,966			4,840			3,659			3,673
Other liabilities		1,230			1,007
Operating lease liabilities								1,946			755
Other liabilities⁽¹⁾								4,585			2,937
Total liabilities		190,150			190,833			131,270			139,326
Commitments and contingencies (Note 11)
Commitments and contingencies (Note 15)
Temporary equity
Redeemable noncontrolling interests		320			194			1,437			2,322
Permanent Equity
BlackRock, Inc. stockholders’ equity
Common stock, $0.01 par value;		2			2			2			2
Shares authorized: 500,000,000 at September 30, 2017 and December 31, 2016; Shares issued: 171,252,185 at September 30, 2017 and December 31, 2016; Shares outstanding: 160,528,060 and 161,534,443 at September 30, 2017 and December 31, 2016, respectively
Preferred stock (Note 15)		—			—
Shares authorized: 500,000,000 at September 30, 2021 and December 31, 2020; Shares issued: 172,075,373 at both September 30, 2021 and December 31, 2020; Shares outstanding: 151,988,234 and 152,532,885 at September 30, 2021 and December 31, 2020, respectively
Additional paid-in capital		19,145			19,337			19,462			19,293
Retained earnings		15,065			13,660			26,672			24,334
Accumulated other comprehensive loss		(473	)		(716	)		(526	)		(337	)
Treasury stock, common, at cost (10,724,125 and 9,717,742 shares held at September 30, 2017 and December 31, 2016, respectively)		(3,697	)		(3,185	)
Treasury stock, common, at cost (20,087,139 and 19,542,488 shares held at September 30, 2021 and December 31, 2020, respectively)								(8,793	)		(8,009	)
Total BlackRock, Inc. stockholders’ equity		30,042			29,098			36,817			35,283
Nonredeemable noncontrolling interests		55			52			112			51
Total permanent equity		30,097			29,150			36,929			35,334
Total liabilities, temporary equity and permanent equity	$	220,567		$	220,177		$	169,636		$	176,982

⁽¹⁾

At September 30, 2021, cash and cash equivalents, investments, other assets and other liabilities include $204 million, $4,099 million, $83 million, and $1,799 million, respectively, related to consolidated variable interest entities (“VIEs”). At December 31, 2020, cash and cash equivalents, investments, other assets and other liabilities include $155 million, $4,253 million, $90 million, and $952 million, respectively, related to consolidated VIEs.

See accompanying notes to condensed consolidated financial statements.

~~BlackRock,~~BlackRock, Inc.

Condensed Consolidated Statements of Income

(unaudited)

													Three Months Ended						Nine Months Ended
	Three Months Ended						Nine Months Ended						September 30,						September 30,
(in millions, except shares and per share data)	September 30,						September 30,						2021			2020			2021			2020
	2017			2016			2017			2016
Revenue
Investment advisory, administration fees and securities lending revenue
Investment advisory, administration fees and securities lending revenue:
Related parties	$	1,995		$	1,768		$	5,662		$	5,098		$	2,964		$	2,329		$	8,478		$	6,556
Other third parties		797			778			2,335			2,296			979			896			2,814			2,690
Total investment advisory, administration fees and securities lending revenue		2,792			2,546			7,997			7,394			3,943			3,225			11,292			9,246
Investment advisory performance fees		191			58			309			166			345			532			814			685
Technology and risk management revenue		175			152			497			439
Technology services revenue														320			282			942			834
Distribution fees		5			10			17			32			401			288			1,110			817
Advisory and other revenue		70			71			202			234			41			42			110			145
Total revenue		3,233			2,837			9,022			8,265			5,050			4,369			14,268			11,727
Expense
Employee compensation and benefits		1,088			969			3,108			2,893			1,527			1,411			4,484			3,700
Distribution and servicing costs		123			114			361			320			585			456			1,613			1,330
Amortization of deferred sales commissions		4			8			13			27
Direct fund expense		234			200			666			583			354			257			994			780
General and administration		363			312			1,014			946
Restructuring charge		—			—			—			76
General and administration expense														611			461			1,657			1,991
Amortization of intangible assets		27			25			77			75			38			27			109			79
Total expense		1,839			1,628			5,239			4,920			3,115			2,612			8,857			7,880
Operating income		1,394			1,209			3,783			3,345			1,935			1,757			5,411			3,847
Nonoperating income (expense)
Net gain (loss) on investments		41			31			128			49			370			269			766			627
Interest and dividend income		15			22			35			33			14			9			41			34
Interest expense		(46	)		(52	)		(159	)		(154	)		(48	)		(54	)		(155	)		(151	)
Total nonoperating income (expense)		10			1			4			(72	)		336			224			652			510
Income before income taxes		1,404			1,210			3,787			3,273			2,271			1,981			6,063			4,357
Income tax expense		445			333			1,090			954			518			464			1,490			811
Net income		959			877			2,697			2,319			1,753			1,517			4,573			3,546
Less:
Net income (loss) attributable to noncontrolling interests		12			2			31			(2	)		72			153			315			162
Net income attributable to BlackRock, Inc.	$	947		$	875		$	2,666		$	2,321		$	1,681		$	1,364		$	4,258		$	3,384
Earnings per share attributable to BlackRock, Inc. common stockholders:
Basic	$	5.85		$	5.33		$	16.41		$	14.09		$	11.05		$	8.94		$	27.94		$	22.00
Diluted	$	5.78		$	5.26		$	16.23		$	13.92		$	10.89		$	8.87		$	27.59		$	21.84
Cash dividends declared and paid per share	$	2.50		$	2.29		$	7.50		$	6.87
Weighted-average common shares outstanding:
Basic		161,872,716			164,129,214			162,459,737			164,756,355			152,120,927			152,488,073			152,375,504			153,816,544
Diluted		163,773,546			166,256,598			164,289,042			166,760,912			154,343,277			153,742,264			154,352,590			154,959,812

See accompanying notes to condensed consolidated financial statements.

~~BlackRock,~~BlackRock, Inc.

Condensed Consolidated Statements of Comprehensive Income

(unaudited)

												Three Months Ended					Nine Months Ended
	Three Months Ended					Nine Months Ended						September 30,					September 30,
(in millions)	September 30,					September 30,						2021			2020		2021			2020
	2017		2016			2017			2016
Net income	$	959	$	877		$	2,697		$	2,319		$	1,753		$	1,517	$	4,573		$	3,546
Other comprehensive income:
Other comprehensive income (loss):
Foreign currency translation adjustments⁽¹⁾		102		(38	)		244			(151	)		(138	)		180		(189	)		(30	)
Other		—		—			(1	)		1
Other comprehensive income (loss)		102		(38	)		243			(150	)
Comprehensive income		1,061		839			2,940			2,169
Comprehensive income (loss)													1,615			1,697		4,384			3,516
Less: Comprehensive income (loss) attributable to noncontrolling interests		12		2			31			(2	)		72			153		315			162
Comprehensive income attributable to BlackRock, Inc.	$	1,049	$	837		$	2,909		$	2,171		$	1,543		$	1,544	$	4,069		$	3,354

⁽¹⁾

Amounts for the three months ended September 30, ~~2017~~2021 and ~~2016~~2020 include a ~~loss~~gain from a net investment hedge of ~~$18~~$14 million (net of tax expense of $5 million) and a loss of $26 million (net of tax benefit of ~~$11 million) and $5 million (net of a tax benefit of $4~~$8 million), respectively. Amounts for the nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 include a ~~loss~~gain from a net investment hedge of ~~$56~~$34 million (net of tax expense of $11 million) and a loss of $27 million (net of tax benefit of ~~$33 million) and $16 million (net of a tax benefit of $10~~$8 million), ~~respectively.~~ respectively.

See accompanying notes to condensed consolidated financial statements.

~~BlackRock,~~BlackRock, Inc.

Condensed Consolidated Statements of Changes in Equity

(unaudited)

For the Nine Months Ended September 30, 2021

(in millions)

Additional
Paid-in
Capital⁽¹⁾

Retained
Earnings

Accumulated
Other
Comprehensive
Income (Loss)

Treasury
Stock
Common

Total
BlackRock
Stockholders’
Equity

Nonredeemable
Noncontrolling
Interests

Total
Permanent
Equity

Redeemable
Noncontrolling
Interests /
Temporary
Equity

December 31, 2016

$
19,339

$
13,660

$
(716
)

$
(3,185
)

$
29,098

$
52

$
29,150

$
194

Net income

—

2,666

—

—

2,666

3

2,669

28

Dividends paid

—

(1,259
)

—

—

(1,259
)

—

(1,259
)

—

Stock-based compensation

417

—

—

—

417

—

417

—

PNC preferred stock capital
    contribution

193

—

—

—

193

—

193

—

Retirement of preferred stock

(193
)

—

—

—

(193
)

—

(193
)

—

Issuance of common shares
   related to employee stock
   transactions

(612
)

—

—

621

9

—

9

—

Employee tax withholdings
   related to employee stock
   transactions

—

—

—

(308
)

(308
)

—

(308
)

—

Shares repurchased

—

—

—

(825
)

(825
)

—

(825
)

—

Subscriptions (redemptions/
   distributions) —
   noncontrolling interest
   holders

—

—

—

—

—

(14
)

(14
)

338

Net consolidations
  (deconsolidations) of
   sponsored
   investment funds

—

—

—

—

—

14

14

(240
)
Other comprehensive
   income (loss)

—

—

243

—

243

—

243

—

Adoption of new accounting
   pronouncement

3

(2
)

—

—

1

—

1

—

September 30, 2017

$
19,147

$
15,065

$
(473
)

$
(3,697
)

$
30,042

$
55

$
30,097

$
320

(in millions)	Additional Paid-in Capital⁽¹⁾			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock Common			Total BlackRock Stockholders’ Equity			Nonredeemable Noncontrolling Interests⁽²⁾			Total Permanent Equity			Redeemable Noncontrolling Interests / Temporary Equity⁽²⁾
December 31, 2020	$	19,295		$	24,334		$	(337	)	$	(8,009	)	$	35,283		$	51		$	35,334		$	2,322
Net income		—			4,258			—			—			4,258			(4	)		4,254			319
Dividends declared ($12.39 per share)		—			(1,920	)		—			—			(1,920	)		—			(1,920	)		—
Stock-based compensation		551			—			—			—			551			—			551			—
Issuance of common shares related to employee stock transactions		(382	)		—			—			398			16			—			16			—
Employee tax withholdings related to employee stock transactions		—			—			—			(282	)		(282	)		—			(282	)		—
Shares repurchased		—			—			—			(900	)		(900	)		—			(900	)		—
Contributions (redemptions/distributions) — noncontrolling interest holders		—			—			—			—			—			68			68			1,058
Net consolidations (deconsolidations) of sponsored investment funds		—			—			—			—			—			(3	)		(3	)		(2,262	)
Other comprehensive income (loss)		—			—			(189	)		—			(189	)		—			(189	)		—
September 30, 2021	$	19,464		$	26,672		$	(526	)	$	(8,793	)	$	36,817		$	112		$	36,929		$	1,437

⁽¹⁾(1)

Amounts include $2 million of common stock at both September 30, ~~2017~~2021 and December 31, ~~2016.~~2020.

(2)	At September 30, 2021, amounts include noncontrolling interests related to consolidated sponsored investment products (“CIPs”) and a consolidated affiliate.

For the Three Months Ended September 30, 2021

(in millions)	Additional Paid-in Capital⁽¹⁾			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock Common			Total BlackRock Stockholders’ Equity			Nonredeemable Noncontrolling Interests⁽²⁾			Total Permanent Equity			Redeemable Noncontrolling Interests / Temporary Equity⁽²⁾
June 30, 2021	$	19,299		$	25,620		$	(388	)	$	(8,498	)	$	36,033		$	115		$	36,148		$	2,242
Net income		—			1,681			—			—			1,681			(6	)		1,675			78
Dividends declared ($4.13 per share)		—			(629	)		—			—			(629	)		—			(629	)		—
Stock-based compensation		173			—			—			—			173			—			173			—
Issuance of common shares related to employee stock transactions		(8	)		—			—			14			6			—			6			—
Employee tax withholdings related to employee stock transactions		—			—			—			(9	)		(9	)		—			(9	)		—
Shares repurchased		—			—			—			(300	)		(300	)		—			(300	)		—
Contributions (redemptions/distributions) — noncontrolling interest holders		—			—			—			—			—			7			7			282
Net consolidations (deconsolidations) of sponsored investment funds		—			—			—			—			—			(4	)		(4	)		(1,165	)
Other comprehensive income (loss)		—			—			(138	)		—			(138	)		—			(138	)		—
September 30, 2021	$	19,464		$	26,672		$	(526	)	$	(8,793	)	$	36,817		$	112		$	36,929		$	1,437

(1)	Amounts include $2 million of common stock at both September 30, 2021 and June 30, 2021.

(2)	At September 30, 2021, amounts include noncontrolling interests related to CIPs and a consolidated affiliate.

See accompanying notes to condensed consolidated financial statements.

BlackRock, Inc.

Condensed Consolidated Statements of Changes in Equity

(unaudited)

For the Nine Months Ended September 30, 2020

(in millions)

Additional
Paid-in
Capital⁽¹⁾

Retained
Earnings

Accumulated
Other
Comprehensive
Income (Loss)

Treasury
Stock
Common

Total
BlackRock
Stockholders’
Equity

Nonredeemable
Noncontrolling
Interests

Total
Permanent
Equity

Redeemable
Noncontrolling
Interests /
Temporary
Equity

December 31, 2015

$
19,407

$
12,033

$
(448
)

$
(2,489
)

$
28,503

$
77

$
28,580

$
464

Net income

—

2,321

—

—

2,321

(2
)

2,319

—

Dividends paid

—

(1,171
)

—

—

(1,171
)

—

(1,171
)

—

Stock-based compensation

408

—

—

—

408

—

408

—

PNC preferred stock capital
    contribution

172

—

—

—

172

—

172

—

Retirement of preferred stock

(172
)

—

—

—

(172
)

—

(172
)

—

Issuance of common shares
    related to employee stock
    transactions

(654
)

—

—

688

34

—

34

—

Employee tax withholdings
    related to employee stock
    transactions

—

—

—

(268
)

(268
)

—

(268
)

—

Shares repurchased

—

—

—

(850
)

(850
)

—

(850
)

—

Net tax benefit (shortfall) from
   stock-based compensation

77

—

—

—

77

—

77

—

Subscriptions (redemptions/
    distributions) —
    noncontrolling interest
    holders

—

—

—

—

—

(18
)

(18
)

1,017

Net consolidations
    (deconsolidations) of
     sponsored
     investment funds

—

—

—

—

—

—

—

(881
)
Other comprehensive
    income (loss)

—

—

(150
)

—

(150
)

—

(150
)

—

September 30, 2016

$
19,238

$
13,183

$
(598
)

$
(2,919
)

$
28,904

$
57

$
28,961

$
600

(in millions)	Additional Paid-in Capital⁽¹⁾			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock Common			Total BlackRock Stockholders’ Equity			Nonredeemable Noncontrolling Interests			Total Permanent Equity			Redeemable Noncontrolling Interests / Temporary Equity
December 31, 2019	$	19,188		$	21,662		$	(571	)	$	(6,732	)	$	33,547		$	66		$	33,613		$	1,316
Net income		—			3,384			—			—			3,384			(2	)		3,382			164
Dividends declared ($10.89 per share)		—			(1,706	)		—			—			(1,706	)		—			(1,706	)		—
Stock-based compensation		458			—			—			—			458			—			458			—
Issuance of common shares related to employee stock transactions		(494	)		—			—			506			12			—			12			—
Employee tax withholdings related to employee stock transactions		—			—			—			(280	)		(280	)		—			(280	)		—
Shares repurchased		—			—			—			(1,512	)		(1,512	)		—			(1,512	)		—
Contributions (redemptions/distributions) — noncontrolling interest holders		—			—			—			—			—			(5	)		(5	)		1,363
Net consolidations (deconsolidations) of sponsored investment funds		—			—			—			—			—			—			—			(759	)
Other comprehensive income (loss)		—			—			(30	)		—			(30	)		—			(30	)		—
September 30, 2020	$	19,152		$	23,340		$	(601	)	$	(8,018	)	$	33,873		$	59		$	33,932		$	2,084

⁽¹⁾	Amounts include $2 million of common stock at both September 30, ~~2016~~2020 and December 31, ~~2015.~~2019.

For the Three Months Ended September 30, 2020

(in millions)	Additional Paid-in Capital⁽¹⁾			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock Common			Total BlackRock Stockholders’ Equity			Nonredeemable Noncontrolling Interests			Total Permanent Equity			Redeemable Noncontrolling Interests / Temporary Equity
June 30, 2020	$	19,009		$	22,532		$	(781	)	$	(8,030	)	$	32,730		$	56		$	32,786		$	1,248
Net income		—			1,364			—			—			1,364			(2	)		1,362			155
Dividends declared ($3.63 per share)		—			(556	)		—			—			(556	)		—			(556	)		—
Stock-based compensation		160			—			—			—			160			—			160			—
Issuance of common shares related to employee stock transactions		(17	)		—			—			22			5			—			5			—
Employee tax withholdings related to employee stock transactions		—			—			—			(10	)		(10	)		—			(10	)		—
Shares repurchased		—			—			—			—			—			—			—			—
Contributions (redemptions/distributions) — noncontrolling interest holders		—			—			—			—			—			5			5			548
Net consolidations (deconsolidations) of sponsored investment funds		—			—			—			—			—			—			—			133
Other comprehensive income (loss)		—			—			180			—			180			—			180			—
September 30, 2020	$	19,152		$	23,340		$	(601	)	$	(8,018	)	$	33,873		$	59		$	33,932		$	2,084

(1)	Amounts include $2 million of common stock at both September 30, 2020 and June 31, 2020.

See accompanying notes to condensed consolidated financial statements.

~~BlackRock,~~

BlackRock, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

	Nine Months Ended						Nine Months Ended
(in millions)	September 30,						September 30,
	2017			2016			2021			2020
Cash flows from operating activities
Operating activities
Net income	$	2,697		$	2,319		$	4,573		$	3,546
Adjustments to reconcile net income to cash flows from operating activities:
Adjustments to reconcile net income to net cash provided by/(used in) operating activities:
Depreciation and amortization		190			198			305			255
Noncash lease expense								101			87
Stock-based compensation		417			408			551			458
Deferred income tax expense (benefit)		175			(6	)		(5	)		20
Assets and liabilities of consolidated VIEs:
Change in cash and cash equivalents		(19	)		(127	)
Net (gains) losses within consolidated VIEs		(95	)		(34	)
Net (purchases) proceeds within consolidated VIEs		(148	)		(855	)
Charitable Contribution								—			589
Gain related to the Charitable Contribution								—			(122	)
Other investment gains								(153	)		(244	)
Net (gains) losses within CIPs								(350	)		(161	)
Net (purchases) proceeds within CIPs								(1,047	)		(1,603	)
(Earnings) losses from equity method investees		(92	)		(71	)		(226	)		(75	)
Distributions of earnings from equity method investees		24			16			54			25
Changes in operating assets and liabilities:
Accounts receivable		(776	)		(336	)		(527	)		(544	)
Investments, trading		(145	)		(278	)		113			153
Other assets		(190	)		(114	)		(1,289	)		(864	)
Accrued compensation and benefits		(267	)		(484	)		(180	)		(206	)
Accounts payable and accrued liabilities		595			309			354			(183	)
Other liabilities		120			17			753			633
Cash flows from operating activities		2,486			962
Cash flows from investing activities
Net cash provided by/(used in) operating activities								3,027			1,764
Investing activities
Purchases of investments		(400	)		(292	)		(579	)		(252	)
Proceeds from sales and maturities of investments		121			215			294			133
Distributions of capital from equity method investees		26			26			77			124
Net consolidations (deconsolidations) of sponsored investment funds		(35	)		(74	)		(59	)		(42	)
Acquisitions		(102	)		(30	)
Acquisitions, net of cash acquired								(1,097	)		—
Purchases of property and equipment		(100	)		(88	)		(215	)		(140	)
Cash flows from investing activities		(490	)		(243	)
Cash flows from financing activities
Net cash provided by/(used in) investing activities								(1,579	)		(177	)
Financing activities
Proceeds from long-term borrowings		697			—			—			2,245
Repayments of long-term borrowings		(700	)		—			(750	)		—
Cash dividends paid		(1,259	)		(1,171	)		(1,920	)		(1,706	)
Proceeds from stock options exercised		—			26
Repurchases of common stock		(1,133	)		(1,118	)		(1,182	)		(1,792	)
Net (redemptions/distributions paid)/subscriptions received from noncontrolling interest holders		324			999
Excess tax benefit from stock-based compensation		—			81
Net proceeds from (repayments of) borrowings by CIPs								32			38
Net contributions (redemptions/distributions) - noncontrolling interest holders								1,126			1,358
Other financing activities		(12	)		3			(1	)		(37	)
Cash flows from financing activities		(2,083	)		(1,180	)
Effect of exchange rate changes on cash and cash equivalents		161			(168	)
Net increase (decrease) in cash and cash equivalents		74			(629	)
Cash and cash equivalents, beginning of period		6,091			6,083
Cash and cash equivalents, end of period	$	6,165		$	5,454
Supplemental disclosure of cash flow information:
Cash paid for:
Interest	$	150		$	144
Income taxes (net of refunds)	$	916		$	910
Net cash provided by/(used in) financing activities								(2,695	)		106
Effect of exchange rate changes on cash, cash equivalents and restricted cash								(56	)		(15	)
Net increase/(decrease) in cash, cash equivalents and restricted cash								(1,303	)		1,678
Cash, cash equivalents and restricted cash, beginning of period								8,681			4,846
Cash, cash equivalents and restricted cash, end of period							$	7,378		$	6,524
Supplemental schedule of noncash investing and financing transactions:
Issuance of common stock	$	612		$	654		$	382		$	494
PNC preferred stock capital contribution	$	193		$	172
Charitable Contribution of an investment							$	—		$	(589	)
Increase (decrease) in noncontrolling interests due to net consolidation (deconsolidation) of sponsored investment funds	$	(226	)	$	(881	)	$	(2,265	)	$	(759	)

See accompanying notes to condensed consolidated financial statements.

~~BlackRock,~~BlackRock, Inc.

Notes to the Condensed Consolidated Financial Statements

(unaudited)

1. Business Overview

BlackRock, Inc. (together, with its subsidiaries, unless the context otherwise indicates, “BlackRock” or the “Company”) is a leading publicly traded investment management firm providing a broad range of investment management and ~~risk management~~technology services to institutional and retail clients worldwide.

BlackRock’s diverse platform of alpha-seeking active, ~~(alpha)~~index and ~~index (beta)~~cash management investment strategies across asset classes enables the Company to tailor investment outcomes and asset allocation solutions for clients. Product offerings include single- and multi-asset portfolios investing in equities, fixed income, alternatives and money market instruments. Products are offered directly and through intermediaries in a variety of vehicles, including open-end and closed-end mutual funds, ~~iShares~~^®exchange-traded funds (“ETFs”), separate accounts, collective ~~investment~~trust funds (“CTFs”) and other pooled investment vehicles. BlackRock also offers antechnology services, including the investment and risk management technology platform, Aladdin^®, ~~risk analytics,~~Aladdin Wealth, eFront, Cachematrix and FutureAdvisor, as well as advisory ~~and technology~~ services and solutions to a broad base of institutional and wealth management ~~investors.~~

At September 30, 2017, The PNC Financial Services Group, Inc. (“PNC”) held 21.4% of the Company’s voting common stock and 21.9% of the Company’s capital stock, which includes outstanding common and nonvoting preferred stock.

clients.

2. Significant Accounting Policies

Basis of Presentation.

These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and include the accounts of the Company and its controlled subsidiaries. Noncontrolling interests (“NCI”) on the condensed consolidated statements of financial condition ~~represents~~represent the portion of CIPs and a consolidated ~~sponsored investment funds~~affiliate (collectively, “consolidated entities”) in which the Company does not have direct equity ownership. ~~Accounts~~Intercompany balances and transactions ~~between consolidated entities~~ have been ~~eliminated.~~eliminated upon consolidation.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting periods. Actual results could differ from those estimates.

Certain financial information that normally is included in annual financial statements, including certain financial statement footnotes, is not required for interim reporting purposes and has been condensed or omitted herein. These condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements and notes related thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2020, which was filed with the Securities and Exchange Commission ~~(“SEC”)~~ on February ~~28, 2017~~25, 2021 (“~~2016~~2020 Form 10-K”).

The interim financial information at September 30, ~~2017~~2021 and for the three and nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 is unaudited. However, in the opinion of management, the interim information includes all normal recurring adjustments necessary for the fair presentation of the Company’s results for the periods presented. The results of operations for interim periods are not necessarily indicative of results to be expected for the full year.

Certain ~~items previously reported have been~~prior period presentations and disclosures, while not required to be recast, were reclassified to ~~conform to~~ensure comparability with current period classifications.

Consolidated Affiliate. During the ~~current year presentation. Beginning with the first~~second quarter of ~~2017,~~ ~~Aladdin~~ ~~revenue previously reported within “~~2021, the Company formed a majority-controlled asset management company in China - BlackRock ~~Solutions~~^®CCB Wealth Management Company Ltd. (“WMC”). WMC is 50.1% owned by the Company. The Company consolidates WMC, which it deems to be a voting rights entity (“VRE”), because it can exert control over the financial and ~~advisory” has been presented within “Technology~~operating policies of the entity, based on the Company’s 50.1% ownership and ~~risk management revenue”~~voting rights.

Noncontrolling Interests. NCI consist of third-party investments in the Company’s sponsored investment products and minority interests in WMC. The Company reports NCI as equity, separate from the parent’s equity, on the condensed consolidated statements of ~~income. The remaining previously reported “BlackRock Solutions~~financial condition. NCI that are redeemable at the option of the holders are classified as temporary equity and ~~advisory” revenue is currently reported~~nonredeemable NCI are classified as ~~part~~a component of ~~“Advisory and other revenue.” The prior period amounts reported for~~ ~~BlackRock Solutions~~ ~~and advisory for the three and nine months ended September 30, 2016 have been reclassified to conform to the current presentation.~~

~~Accounting Pronouncements Adopted~~permanent equity in ~~the Nine Months Ended September 30, 2017.~~

~~Accounting for Share-Based Payments.~~ ~~In March 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-09,~~ ~~Improvements to Employee Share-Based Payment Accounting~~ (“ASU 2016-09”). ASU 2016-09 simplifies accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the condensed consolidated

~~statements of cash flows. The Company adopted ASU 2016-09 as of January 1, 2017. ASU 2016-09 requires all excess tax benefits and deficiencies to be recognized in income tax expense on~~ the condensed consolidated statements of income. Accordingly, the Company recorded a discrete income tax benefit of $81 million during the three months ended March 31, 2017 for vested restricted stock units where the grant date stock price was lower than the vesting date stock price. The new guidance will increase the volatility of income tax expense as a result of fluctuations in the Company’s stock price. Upon adoption, the Company elected to account for forfeitures as they occur, which did not have a material impact on the condensed consolidated financial ~~statements.~~condition. In addition, the Company ~~elected~~reports net income (loss) attributable to ~~present excess tax benefits~~redeemable and ~~deficiencies prospectively~~nonredeemable NCI holders in ~~operating activities on~~net income (loss) attributable to NCI in the condensed consolidated statements of ~~cash flows.~~income.

Noncontrolling Interests – CIPs. NCI of CIPs represent third-party investments in the Company’s sponsored investment products.

Noncontrolling Interests – Consolidated Affiliate. NCI of consolidated affiliate represent minority interests held in WMC, a consolidated affiliate. NCI of a consolidated affiliate that are classified as nonredeemable are included as a component of permanent equity in the condensed consolidated statements of financial condition. NCI of a consolidated affiliate that are classified as redeemable are included in temporary equity at estimated redemption value in the condensed consolidated statements of financial condition.

Fair Value ~~Measurements.~~Measurements

Hierarchy of Fair Value ~~Inputs~~. Inputs. The Company uses a fair value hierarchy that prioritizes inputs to valuation approaches used to measure fair value. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. Assets and liabilities measured and reported at fair value are classified and disclosed in one of the following categories:

Level 1 Inputs:

Quoted prices (unadjusted) in active markets for identical assets or liabilities at the reporting date.

~~Level 1 assets may include listed mutual funds, ETFs, listed equities and certain exchange-traded derivatives.~~

•

Level 1 assets may include listed mutual funds, ETFs, listed equities and certain exchange-traded derivatives.

Level 2 Inputs:

Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities that are not active; quotes from pricing services or brokers for which the Company can determine that orderly transactions took place at the quoted price or that the inputs used to arrive at the price are observable; and inputs other than quoted prices that are observable, such as models or other valuation methodologies.

Level 2 assets may include debt securities, investments in CLOs, short-term floating-rate notes, asset-backed securities, securities held within consolidated hedge funds, restricted public securities valued at a discount, as well as over-the-counter derivatives, including interest and inflation rate swaps and foreign currency exchange contracts that have inputs to the valuations that generally can be corroborated by observable market data.

•

Level 2 assets may include debt securities, investments in collateralized loan obligations (“CLOs”), bank loans, short-term floating-rate notes, asset-backed securities, securities held within consolidated hedge funds, restricted public securities valued at a discount, as well as over-the-counter derivatives, including interest and inflation rate swaps and foreign currency exchange contracts that have inputs to the valuations that generally can be corroborated by observable market data.

Level 3 Inputs:

Unobservable inputs for the valuation of the asset or liability, which may include nonbinding broker quotes. Level 3 assets include investments for which there is little, if any, market activity. These inputs require significant management judgment or estimation.

~~Level 3 assets may include direct private equity investments held within consolidated funds and investments in CLOs.~~

•

Level 3 assets may include direct private equity investments held within consolidated funds, investments in CLOs and bank loans held within consolidated CLOs.

~~Level 3 liabilities include contingent liabilities related to acquisitions valued based upon discounted cash flow analyses using unobservable market data.~~

•

Level 3 liabilities may include borrowings of consolidated CLOs and contingent liabilities related to acquisitions valued based upon discounted cash flow analyses using unobservable market data.

Significance of Inputs.The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument.

Valuation Approaches.The fair values of certain Level 3 assets and liabilities were determined using various valuation approaches as appropriate, including third-party pricing vendors, broker quotes and market and income approaches. Such quotes and modeled prices are evaluated for reasonableness through various procedures, including due diligence reviews of third-party pricing vendors, variance analyses, consideration of the current market environment and other analytical procedures.

A significant number of inputs used to value equity, debt securities, ~~and~~ investments in CLOs and bank loans is sourced from third-party pricing vendors. Generally, prices obtained from pricing vendors are categorized as Level 1 inputs for identical securities traded in active markets and as Level 2 for other similar securities if the vendor uses observable inputs in determining the price. Annually, BlackRock’s internal valuation committee or other designated groups review both the valuation approaches, including the general assumptions and methods used to value various asset classes, and

~~operational processes with these vendors. On a quarterly basis, meetings are held with key vendors to identify any significant changes to the vendors’ processes.~~

In addition, quotes obtained from brokers generally are nonbinding and categorized as Level 3 inputs. However, if the Company is able to determine that market participants have transacted for the asset in an orderly manner near the quoted price or if the Company can determine that the inputs used by the broker are observable, the quote is classified as a Level 2 input.

Investments Measured at Net Asset Values. As a practical expedient, the Company uses net asset value (“NAV”) as the fair value for certain investments. The inputs to value these investments may include ~~BlackRock~~the Company’s capital accounts for its partnership interests in various alternative investments, including hedge funds, real assets and private equity funds, which may be adjusted by using the returns of certain market indices. The various partnerships generally are investment companies, which record their underlying investments at fair value based on fair value policies established by management of the underlying fund. Fair value policies at the underlying fund generally require the fund to utilize pricing/valuation information from third-party sources, including independent appraisals. However, in some instances, current valuation information for illiquid securities or securities in markets that are not active may not be available from any third-party source or fund management may conclude that the valuations that are available from third-party sources are not reliable. In these instances, fund management may perform model-based analytical valuations that could be used as an input to value these investments.

~~Derivative Instruments~~Fair Value Assets and Liabilities of Consolidated CLO. The Company applies the fair value option provisions for eligible assets, including bank loans, held by a consolidated CLO. As the fair value of the financial assets of the consolidated CLO is more observable than the fair value of the borrowings of the consolidated CLO, the Company measures the fair value of the borrowings of the consolidated CLO equal to the fair value of the assets of the consolidated CLO less the fair value of the Company’s economic interest in the CLO.

Derivatives and Hedging Activities. The Company does not use derivative financial instruments for trading or speculative purposes. The Company uses derivative financial instruments primarily for purposes of hedging exposures to fluctuations in foreign currency exchange rates of certain assets and liabilities, and market exposures for certain seed investments. However, certain consolidated sponsored investment funds may also utilize derivatives as a part of their investment strategy.

The Company records all derivative financial instruments as either assets or liabilities at fair value on a gross basis in the condensed consolidated statements of financial condition. Credit risks are managed through master netting and collateral support agreements. The amounts related to the right to reclaim or the obligation to return cash collateral may not be used to offset amounts due under the derivative instruments in the normal course of settlement. Therefore, such amounts are not offset against fair value amounts recognized for derivative instruments with the same counterparty and are included in other assets and other liabilities. Changes in the fair value of the Company’s derivative financial instruments are recognized in earnings and, where applicable, are offset by the corresponding gain or loss on the related foreign-denominated assets or liabilities or hedged investments, on the condensed consolidated statements of income.

The Company may also use financial instruments designated as net investment hedges for accounting purposes to hedge net investments in international subsidiaries whose functional currency is not ~~U.S.~~US dollars. The gain or loss from revaluing ~~accounting~~net investment hedges ~~of net investments in foreign operations~~ at the spot rate is deferred and reported within accumulated other comprehensive income (loss) (“AOCI”) on the condensed consolidated statements of financial condition. Amounts excluded from the effectiveness assessment are reported in the condensed consolidated statements of income using a systematic and rational method. The Company reassesses the effectiveness of its net investment hedge ~~on a quarterly basis.~~

~~Money Market Fee Waivers~~. The Company is currently voluntarily waiving a portion of its management fees on certain money market funds to ensure that they maintain a targeted level of daily net investment income (the “Yield Support waivers”). During the three and nine months ended September 30, 2017, these waivers resulted in a reduction of management fees of approximately $0~~million and $6 million, respectively. During the three and nine months ended September 30, 2016, these waivers resulted in a reduction of management fees of approximately $17~~million and $42 million, respectively. Approximately 0% and 45% of Yield Support waivers for the nine months ended September 30, 2017 and 2016, respectively, were offset by a reduction of BlackRock’s distribution and servicing costs paid to a financial intermediary. BlackRock may increase or decrease the level of Yield Support waivers in future periods.at least quarterly.

Separate Account Assets and Liabilities. Separate account assets are maintained by BlackRock Life Limited, a wholly owned subsidiary of the Company, which is a registered life insurance company in the United Kingdom (“UK”), and represent segregated assets held for purposes of funding individual and group pension contracts. The life insurance company does not underwrite any insurance contracts that involve any insurance risk transfer from the insured to the life insurance company. The separate account assets primarily include equity securities, debt securities, money market funds and derivatives. The separate account assets are not subject to general claims of the creditors of BlackRock. These separate account assets and the related equal and offsetting liabilities are recorded as separate account assets and separate account liabilities on the condensed consolidated statements of financial condition.

The net investment income attributable to separate account assets supporting individual and group pension contracts accrues directly to the contract owner and is not reported on the condensed consolidated statements of income. While BlackRock has no economic interest in these separate account assets and liabilities, BlackRock earns policy administration and management fees associated with these products, which are included in investment advisory, administration fees and securities lending revenue on the condensed consolidated statements of income.

Separate Account Collateral Assets Held and Liabilities Under Securities Lending Agreements. The Company facilitates securities lending arrangements whereby securities held by separate accounts maintained by BlackRock Life Limited are lent to third parties under global master securities lending agreements. In exchange, the Company receives legal title to the collateral with minimum values generally ranging from approximately 102% to 112% of the value of the securities lent in order to reduce counterparty risk. The required collateral value is calculated on a daily basis. The global master securities lending agreements provide the Company the right to request additional collateral or, in the event of borrower default, the right to liquidate collateral. The securities lending transactions entered into by the Company are accompanied by an agreement that entitles the Company to request the borrower to return the securities at any time; therefore, these transactions are not reported as sales.

The Company records on the condensed consolidated statements of financial condition the cash and noncash collateral received under these BlackRock Life Limited securities lending arrangements as its own asset in addition to an equal and offsetting collateral liability for the obligation to return the collateral. The securities lending revenue earned from lending securities held by the separate accounts is included in investment advisory, administration fees and securities lending revenue on the condensed consolidated statements of income. During the nine months ended September 30, ~~2017~~2021 and ~~2016,~~2020, the Company had ~~not~~0t resold or repledged any of the collateral received under these arrangements. At September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, the fair value of loaned securities held by separate accounts was approximately ~~$24.7~~$13 billion and ~~$25.7~~$15.2 billion, respectively, and the fair value of the collateral held under these securities lending agreements was approximately ~~$27.4~~$14.1 billion and ~~$27.8~~$16.5 billion, respectively.

~~Recent Accounting Pronouncements Not Yet Adopted.~~

~~Revenue from Contracts with Customers.~~ ~~In May 2014, the FASB issued ASU 2014-09,~~ ~~Revenue from Contracts with Customers~~ (“ASU 2014-09”). ASU 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The guidance also changes the accounting for certain contract costs and revises the criteria for determining if an entity is acting as a principal or agent in certain arrangements.Money Market Fee Waivers. The Company ~~continues to evaluate the impact of ASU 2014-09 on the presentation and recognition~~may voluntarily waive a portion of its ~~revenue contracts~~management fees on certain money market funds to ensure that they maintain a targeted level of daily net investment income (the “Yield Support waivers”). During the three and ~~certain contract costs.~~nine months ended September 30, 2021, these waivers resulted in a reduction of management fees of approximately $130 million and $360 million, respectively, which was partially offset by a reduction of BlackRock’s distribution and servicing costs paid to financial intermediaries. There were no Yield Support waivers for the three and nine months ended September 30, 2020. The ~~most significant change identified to date relates~~Company may increase or decrease the level of Yield Support waivers in future periods.

3. Acquisitions

Aperio Group, LLC

On February 1, 2021, the Company acquired 100% of the equity interests of Aperio Group, LLC (the “Aperio Transaction” or “Aperio”), a pioneer in customizing tax-optimized index equity separately managed accounts (“SMAs”) for approximately $1.1 billion in cash, using existing cash resources. The acquisition of Aperio increased BlackRock’s SMA assets under management and expanded the breadth of the Company’s capabilities via tax-managed strategies across factors, broad market indexing, and investor Environmental, Social, and Governance preferences across all asset classes.

The purchase price for the Aperio Transaction was allocated to the ~~presentation~~assets acquired and liabilities assumed based upon their estimated fair values at the date of ~~certain distribution costs, which are currently presented net against revenues (contra-revenue) and will likely be presented as an expense on a gross basis.~~ the transaction. The ~~Company currently expects such net gross up~~goodwill recognized in connection with the acquisition is primarily attributable to ~~annual revenue~~anticipated synergies from the transaction. The amount of goodwill expected to be deductible for tax purposes is approximately ~~$1 billion with a corresponding gross up~~$0.6 billion. A summary of the fair values of the assets acquired and liabilities assumed in this acquisition is as follows⁽¹⁾:


	Estimate of
(in millions)	Fair Value
Accounts receivable	$	16
Finite-lived intangible assets:
Customer relationships⁽²⁾		270
Other		17
Goodwill		787
Deferred income tax liabilities		(16	)
Other liabilities assumed		(12	)
Total consideration, net of cash acquired	$	1,062

Summary of consideration, net of cash acquired:
Cash paid	$	1,066
Cash acquired		(4	)
Total consideration, net of cash acquired	$	1,062

⁽¹⁾	At this time, the Company does not expect material changes to the value of the assets acquired or liabilities assumed in conjunction with the transaction.

⁽²⁾	The fair value was determined based on the excess earnings method (a Level 3 input), has a weighted-average estimated useful life of approximately 10 years and is amortized using the accelerated amortization method.

Finite-lived intangible assets are amortized over their estimated useful lives, which range from three to ~~annual expense. The Company is currently evaluating which transition method it will apply when it adopts the new revenue recognition guidance in the first quarter of 2018.~~

~~Recognition and Measurement of Financial Instruments~~.~~In January 2016, the FASB issued ASU 2016-01,~~ ~~Recognition and Measurement of Financial Assets and Financial Liabilities~~ ~~(“ASU 2016-01”). ASU 2016-01 amends guidance on the classification and measurement of financial instruments, including significant revisions in accounting~~10 years. Amortization expense related to the ~~classification~~finite-lived intangible assets was $10 million and ~~measurement~~$27 million, respectively, for the three and nine months ended September 30, 2021. The finite-lived intangible assets had a weighted-average remaining useful life of ~~investments~~approximately nine years with remaining amortization expense as follows:

(in millions)
Year	Amount
2021 (excluding the nine months ended September 30, 2021)	$	10
2022		40
2023		38
2024		32
2025		29
Thereafter		111
Total	$	260

The financial results of Aperio have been included in ~~equity securities~~BlackRock’s condensed consolidated financial statements from the closing of the Aperio Transaction. For the three and ~~presentation~~nine months ended September 30, 2021, Aperio contributed $22 million and $56 million, respectively, of ~~certain fair value changes~~revenue and did 0t have a material impact to net income attributable to BlackRock, Inc. Consequently, the Company has not presented pro forma combined results of operations for this acquisition.

Baringa’s Climate Change Scenario Model

In June 2021, the Company completed the acquisition of Baringa Partners’ Climate Change Scenario Model, which will be integrated into BlackRock’s Aladdin Climate technology, and will enhance Aladdin Climate’s capabilities and analytics.Total consideration, including contingent consideration, is not material to the Company’s condensed consolidated financial ~~liabilities when the fair value option is elected. ASU 2016-01 also amends certain disclosure requirements associated with the fair value~~statements.

4. Cash, Cash Equivalents and Restricted Cash

The following table provides a reconciliation of ~~financial instruments. The Company does not currently expect the reclassification of unrealized gains(losses) on equity securities~~cash and cash equivalents reported within ~~accumulated other comprehensive income to retained earnings to be material upon adoption effective January 1, 2018.~~

~~Leases.~~ ~~In February 2016, the FASB issued ASU 2016-02,~~ ~~Leases~~ ~~(“ASU 2016-02”), which requires lessees to recognize assets and liabilities arising from most operating leases on~~ the condensed consolidated statements of financial ~~condition. The Company expects~~condition to ~~record assets~~the cash, cash equivalents, and ~~liabilities for its current operating leases upon adoption of ASU 2016-02 and does not expect the adoption to have a material impact on its results of operations or~~restricted cash flows. ASU 2016-02 is effective for the Company on January 1, 2019, and the Company intends to apply the practical expedients allowed by the standard upon transition. See Note 13 of the 2016 Form 10-K for information on the Company’s operating lease commitments.

~~Cash Flow Classification.~~ ~~In August 2016, the FASB issued ASU 2016-15,~~ ~~Classification of Certain Cash Receipts and Cash Payments~~ ~~(“ASU 2016-15”), which amends and clarifies the current guidance to reduce diversity in practice of the classification of certain cash receipts and payments in~~reported within the condensed consolidated statements of cash flows. The Company is currently evaluating the impact of adopting ASU 2016-15, which is effective for the Company on January 1, 2018 with early adoption permitted. The Company must apply the guidance retrospectively to all periods presented.

	September 30,		December 31,
	2021		2020
(in millions)
Cash and cash equivalents	$	7,361	$	8,664
Restricted cash included in other assets		17		17
Total cash, cash equivalents and restricted cash	$	7,378	$	8,681

5. Investments

A summary of the carrying value of total investments is as follows:

September 30,

December 31,

(in millions)

2017

2016

Available-for-sale investments

$
104

$
80

Held-to-maturity investments

76

51

Trading investments:

Consolidated sponsored investment funds

507

465

Other equity and debt securities

131

101

Deferred compensation plan mutual funds

54

59

Total trading investments

692

625

Other investments:

Equity method investments⁽¹⁾

944

730

Cost method investments⁽²⁾

92

91

Carried interest⁽³⁾

20

18

Total other investments

1,056

839

Total investments

$
1,928

$
1,595

	September 30,		December 31,
(in millions)	2021		2020
Debt securities:
Held-to-maturity investments	$	386	$	310
Trading securities		1,480		1,964
Total debt securities		1,866		2,274
Equity securities at FVTNI⁽¹⁾		1,591		2,317
Equity method investments⁽²⁾		1,544		1,081
Bank loans		282		248
Federal Reserve Bank stock⁽³⁾		95		94
Carried interest⁽⁴⁾		1,446		627
Other investments⁽⁵⁾		277		278
Total investments	$	7,101	$	6,919

⁽¹⁾⁽¹⁾

Fair value recorded through net income (“FVTNI”).

⁽²⁾	Equity method investments primarily include BlackRock’s direct investments in certain BlackRock sponsored investment funds.

⁽²⁾⁽³⁾

~~Amounts include nonmarketable securities, primarily~~At both September 30, 2021 and December 31, 2020, there were no indicators of impairment of Federal Reserve Bank stock, which is held for regulatory purposes and is restricted from sale. ~~At September 30, 2017 and December 31, 2016, there were no indicators of impairment on these investments.~~

⁽³⁾⁽⁴⁾

Carried interest ~~of consolidated sponsor investment funds accounted for as voting rights entities (“VREs”)~~ represents allocations to BlackRock’s general partner capital accounts from certain sponsored investment funds. These balances are subject to change upon cash distributions, additional allocations or reallocations back to limited partners within the respective funds.

⁽⁵⁾	Other investments include BlackRock’s investments in nonmarketable equity securities, which are measured at cost, adjusted for observable price changes and private equity and real asset investments of CIPs measured at fair value.

~~Available-for-Sale Investments~~

At both September 30, 2017 and December 31, 2016, available-for-sale investments primarily included certain investments in CLOs and seed investments in BlackRock sponsored mutual funds. The cost of these investments approximated carrying value.

Held-to-Maturity Investments

The carrying value of held-to-maturity investments was ~~$76~~$386 million and ~~$51~~$310 million at September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively. Held-to-maturity investments included certain investments in CLOs and foreign government debt held primarily for regulatory ~~purposes and certain investments in CLOs.~~purposes. The amortized cost (carrying value) of these investments approximated fair ~~value.~~value (primarily a Level 2 input). At September 30, ~~2017, $11~~2021, $36 million of these investments mature between one to five years, $96 million of these investments mature between five to ~~ten~~10 years and ~~$65~~$254 million of these investments mature after ~~ten~~10 years.

Trading ~~Investments~~Debt Securities and Equity Securities at FVTNI

A summary of the cost and carrying value of trading ~~investments~~debt securities and equity securities at FVTNI is as follows:


	September 30, 2021				December 31, 2020
(in millions)	Cost		Carrying Value		Cost		Carrying Value
Trading debt securities:
Corporate debt	$	961	$	970	$	1,591	$	1,641
Government debt		403		403		203		210
Asset/mortgage-backed debt		120		107		132		113
Total trading debt securities	$	1,484	$	1,480	$	1,926	$	1,964
Equity securities at FVTNI:
Equity securities/mutual funds	$	1,311	$	1,591	$	2,055	$	2,317
Total equity securities at FVTNI	$	1,311	$	1,591	$	2,055	$	2,317

September 30,

December 31,

(in millions)

2017

2016

Cost

Carrying
Value

Cost

Carrying
Value

Trading investments:

Deferred compensation plan mutual funds

$
34

$
54

$
41

$
59

Equity securities/multi-asset mutual funds

323

353

290

308

Debt securities/fixed income mutual funds:

Corporate debt

160

162

128

128

Government debt

59

60

60

60

Asset/mortgage backed debt

62

63

70

70

Total trading investments

$
638

$
692

$
589

$
625

At September 30, 2017, trading investments included $268 million of debt securities and $239 million of equity securities held by consolidated sponsored investment funds accounted for as VREs, $54 million of certain deferred compensation plan mutual fund investments and $131 million of other equity and debt securities.

At December 31, 2016, trading investments included $246 million of debt securities and $219 million of equity securities held by consolidated sponsored investment funds accounted for as VREs, $59 million of certain deferred compensation plan mutual fund investments and $101 million of other equity and debt securities.

~~Other~~

In addition, the Company accounts for its interest in PennyMac Financial Services, Inc. (“PennyMac”) as an equity method investment. At September 30, 2017 and December 31, 2016 the Company’s investment in PennyMac was excluded from investments in the table above and included in other assets on the condensed consolidated statements of financial condition. The carrying value and fair value of the Company’s interest (approximately 20% or 16 million shares and units) was approximately $333 million and $277 million, respectively, at September 30, 2017 and approximately $301 million and $259 million, respectively, at December 31, 2016. The fair value of the Company’s interest reflected the PennyMac stock price at September 30, 2017 and December 31, 2016, respectively (a Level 1 input). The Company performed an other-than-temporary impairment analysis as of September 30, 2017 and determined the difference in fair value below the carrying value to be temporary.

4.6. Consolidated ~~Voting Rights Entities~~Sponsored Investment Products

The Company consolidates certain sponsored investment funds accounted for as VREs because it is deemed to control such funds. The investments owned by these consolidated VREs are classified as trading investments. The following table presents the balances related to these consolidated VREs that were recorded on the condensed consolidated statements of financial condition, including BlackRock’s net interest in these funds:

September 30,

December 31,

(in millions)

2017

2016

Cash and cash equivalents

$
73

$
53

Trading investments

507

465

Other assets

28

15

Other liabilities

(61
)

(50
)
Noncontrolling interests ("NCI")

(68
)

(39
)
BlackRock’s net interests in consolidated VREs

$
479

$
444

BlackRock’s total exposure to consolidated VREs represents the value of its economic ownership interest in these sponsored investment funds. Valuation changes associated with investments held at fair value by these consolidated VREs are reflected in nonoperating income (expense) and partially offset in net income (loss) attributable to noncontrolling interests for the portion not attributable to BlackRock.

~~The Company cannot readily access cash and cash equivalents held by consolidated VREs to use in its operating activities.~~

~~5. Variable Interest Entities~~

In the normal course of business, the Company is the manager of various types of sponsored investment vehicles, which may be considered ~~variable interest entities (“VIEs”).~~VIEs. The Company may from time to time own equity or debt securities or enter into derivatives with the vehicles, each of which are considered variable interests. The Company’s involvement in financing the operations of the VIEs is generally limited to its investments in the entity. The ~~Company consolidates entities when it is determined to be the primary beneficiary (“PB”).~~

~~Consolidated VIEs.~~ ~~The~~ Company’s consolidated VIEs include certain sponsored investment ~~funds~~products in which BlackRock has an investment and as the investment manager, is deemed to have both the power to direct the most significant activities of the ~~funds~~products and the right to receive benefits (or the obligation to absorb losses) that could potentially be significant to these sponsored investment ~~funds.~~products. The assets of these VIEs are not available to creditors of the Company. In addition, the investors in these VIEs have no recourse to the credit of the Company.

~~Consolidated VIE assets~~The following table presents the balances related to these CIPs accounted for as VIEs and ~~liabilities are presented after intercompany eliminations~~VREs that were recorded on the condensed consolidated statements of financial condition, including BlackRock’s net interest in ~~the following table:~~these products:

	September 30, 2021									December 31, 2020
(in millions)	VIEs			VREs			Total			VIEs			VREs			Total
Cash and cash equivalents	$	204		$	61		$	265		$	155		$	51		$	206
Investments:
Trading debt securities		1,258			167			1,425			1,618			310			1,928
Equity securities at FVTNI		946			308			1,254			1,592			413			2,005
Bank loans		282			—			282			248			—			248
Other investments		207			—			207			191			—			191
Carried interest		1,406			—			1,406			604			—			604
Total investments		4,099			475			4,574			4,253			723			4,976
Other assets		83			10			93			90			9			99
Other liabilities⁽¹⁾		(1,799	)		(39	)		(1,838	)		(952	)		(70	)		(1,022	)
Noncontrolling interests - CIPs		(1,416	)		(59	)		(1,475	)		(2,193	)		(180	)		(2,373	)
BlackRock's net interests in CIPs	$	1,171		$	448		$	1,619		$	1,353		$	533		$	1,886

September 30,

December 31,

(in millions)

2017

2016

Assets of consolidated VIEs:

Cash and cash equivalents

$
82

$
84

Investments

1,286

1,008

Other assets

46

63

Total investments and other assets

1,332

1,071

Liabilities of consolidated VIEs

(319
)

(216
)
Noncontrolling interests

(307
)

(207
)
BlackRock's net interests in consolidated VIEs

$
788

$
732

⁽¹⁾	At both September 30, 2021 and December 31, 2020, other liabilities of VIEs primarily include deferred carried interest liabilities and borrowings of a consolidated CLO.

BlackRock’s total exposure to CIPs represents the value of its economic ownership interest in these CIPs. Valuation changes associated with investments held at fair value by these CIPS are reflected in nonoperating income (expense) and partially offset in net income (loss) attributable to NCI for the portion not attributable to BlackRock.

The Company cannot readily access cash and cash equivalents held by CIPs to use in its operating activities.

Net gain (loss) related to consolidated VIEs is presented in the following table:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in millions)	2021		2020		2021		2020

Nonoperating net gain (loss) on consolidated VIEs	$	50	$	213	$	323	$	186

Net income (loss) attributable to NCI on consolidated VIEs	$	73	$	149	$	296	$	169

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in millions)

2017

2016

2017

2016

Nonoperating net gain (loss) on consolidated VIEs

$
29

$
19

$
95

$
34

Net gain (loss) attributable to NCI on consolidated VIEs

$
10

$
1

$
28

$
(2
)

~~Non-Consolidated~~

7. Variable Interest Entities

Nonconsolidated VIEs. At September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, the Company’s carrying value of assets and liabilities included on the condensed consolidated statements of financial condition pertaining to nonconsolidated VIEs and its maximum risk of loss related to VIEs for which it held a variable interest, but for which it was not the ~~PB,~~primary beneficiary, was as follows:

(in millions)												Advisory Fee		Other Net Assets			Maximum
At September 30, 2017	Investments		Advisory Fee Receivables		Other Net Assets (Liabilities)			Maximum Risk of Loss⁽¹⁾
At September 30, 2021										Investments		Receivables		(Liabilities)			Risk of Loss⁽¹⁾
Sponsored investment products	$	227	$	15	$	(7	)	$	259	$	865	$	71	$	(12	)	$	953
At December 31, 2016
At December 31, 2020
Sponsored investment products	$	171	$	9	$	(8	)	$	197	$	662	$	71	$	(13	)	$	750

⁽¹⁾	At both September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, BlackRock’s maximum risk of loss associated with these VIEs primarily related to BlackRock’s investments and the collection of advisory fee receivables.

The net assets of sponsored investment products that are nonconsolidated VIEs approximated $5$23 billion and $4$16 billion at September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively.

6.8. Fair Value Disclosures

Fair Value Hierarchy

Assets and liabilities measured at fair value on a recurring basis ~~and other assets not held at fair value~~

September 30, 2017

Quoted
Prices in
Active
Markets for
Identical
Assets

Significant
Other
Observable
Inputs

Significant
Unobservable
Inputs

Investments
Measured at

Other Assets
Not Held at

September 30,

(in millions)

(Level 1)

(Level 2)

(Level 3)

NAV⁽¹⁾

Fair Value⁽²⁾

2017

Assets:

Investments

Available-for-sale

$
8

$
73

$
23

$
—

$
—

$
104

Held-to-maturity securities

—

—

—

—

76

76

Trading:

—

Deferred compensation plan mutual funds

54

—

—

—

—

54

Equity securities/Multi-asset mutual funds

353

—

—

—

—

353

Debt securities / fixed income mutual funds

1

282

2

—

—

285

Total trading

408

282

2

—

—

692

Other investments:

Equity method:

Equity and fixed income mutual funds

314

—

—

10

—

324

Other

—

—

—

608

12

620

Total equity method

314

—

—

618

12

944

Cost method investments

—

—

—

—

92

92

Carried interest

—

—

—

—

20

20

Total investments

730

355

25

618

200

1,928

Separate account assets

112,957

34,268

—

—

713

147,938

Separate account collateral held under securities lending
   agreements:

Equity securities

19,093

—

—

—

—

19,093

Debt securities

—

8,338

—

—

—

8,338

Total separate account collateral held under securities
   lending agreements

19,093

8,338

—

—

—

27,431

Investments of consolidated VIEs:

Private / public equity⁽³⁾

5

3

114

69

83

274

Equity securities

338

—

—

—

—

338

Debt securities

—

350

—

—

—

350

Other

—

—

—

64

—

64

Carried interest

—

—

—

—

260

260

Total investments of consolidated VIEs

343

353

114

133

343

1,286

Total

$
133,123

$
43,314

$
139

$
751

$
1,256

$
178,583

Liabilities:

Separate account collateral liabilities under securities
   lending agreements

$
19,093

$
8,338

$
—

$
—

$
—

$
27,431

Other liabilities⁽⁴⁾

—

7

228

—

—

235

Total

$
19,093

$
8,345

$
228

$
—

$
—

$
27,666

September 30, 2021 (in millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Investments Measured at NAV⁽¹⁾		Other⁽²⁾		September 30, 2021
Assets:
Investments
Debt securities:
Held-to-maturity investments	$	—	$	—	$	—	$	—	$	386	$	386
Trading securities		—		1,450		30		—		—		1,480
Total debt securities		—		1,450		30		—		386		1,866
Equity securities at FVTNI:
Equity securities/mutual funds		1,591		—		—		—		—		1,591
Equity method:
Equity and fixed income mutual funds		339		—		—		—		—		339
Hedge funds/funds of hedge funds		—		—		—		359		—		359
Private equity funds		—		—		—		633		—		633
Real assets funds		—		—		—		213		—		213
Total equity method		339		—		—		1,205		—		1,544
Bank loans		—		9		273		—		—		282
Federal Reserve Bank Stock		—		—		—		—		95		95
Carried interest		—		—		—		—		1,446		1,446
Other investments⁽³⁾		—		4		5		94		174		277
Total investments		1,930		1,463		308		1,299		2,101		7,101
Other assets⁽⁴⁾		197		23		—		—		—		220
Separate account assets		65,704		30,146		—		—		905		96,755
Separate account collateral held under securities lending agreements:
Equity securities		10,551		—		—		—		—		10,551
Debt securities		—		3,555		—		—		—		3,555
Total separate account collateral held under securities lending agreements		10,551		3,555		—		—		—		14,106
Total	$	78,382	$	35,187	$	308	$	1,299	$	3,006	$	118,182
Liabilities:
Separate account collateral liabilities under securities lending agreements	$	10,551	$	3,555	$	—	$	—	$	—	$	14,106
Other liabilities⁽⁵⁾		—		41		340		—		—		381
Total	$	10,551	$	3,596	$	340	$	—	$	—	$	14,487

⁽¹⁾	Amounts are comprised of certain investments measured at fair value using NAV (or its equivalent), as a practical expedient.

⁽²⁾

Amounts are comprised of investments held at ~~cost or~~ amortized cost and cost, adjusted for observable price changes, carried interest and certain equity method investments, which include sponsored investment funds and other assets, which are not accounted for under a fair value measure. In accordance with GAAP, certain equity method investees do not account for both their financial assets and liabilities under fair value measures; therefore, the Company’s investment in such equity method investees may not represent fair value.

⁽³⁾	Level 3 ~~amounts~~amount primarily ~~include~~includes direct investments in private equity companies held by consolidated private equity funds.

⁽⁴⁾	~~Amounts~~Level 1 amount includes a minority investment in a publicly traded company. Level 2 amount primarily includes derivatives (See Note 9, Derivatives and Hedging, for more information).

⁽⁵⁾

Level 2 amount primarily includes derivatives (See Note 9, Derivatives and Hedging, for more information). Level 3 amounts primarily include borrowings of a consolidated CLO classified based on the significance of unobservable inputs used for calculating the fair value of consolidated CLO assets, and contingent liabilities related to certain acquisitions (see Note ~~11,~~ 15, Commitments and Contingencies, for more information).

Assets and liabilities measured at fair value on a recurring basis ~~and other assets not held at fair value~~

December 31, 2016
(in millions)

Quoted Prices in
Active
Markets for
Identical Assets
(Level 1)

Significant Other
Observable Inputs
(Level 2)

Significant
Unobservable
Inputs
(Level 3)

Investments Measured at NAV⁽¹⁾

Other Assets
Not Held at Fair
Value⁽²⁾

December 31,
2016

Assets:

Investments

Available-for-sale

$
7

$
49

$
24

$
—

$
—

$
80

Held-to-maturity securities

—

—

—

—

51

51

Trading:

Deferred compensation plan mutual funds

59

—

—

—

—

59

Equity/Multi-asset mutual funds

308

—

—

—

—

308

Debt securities / fixed income mutual funds

1

250

7

—

—

258

Total trading

368

250

7

—

—

625

Other investments:

Equity method:

Equity and fixed income mutual funds

323

—

—

5

—

328

Other

—

—

—

394

8

402

Total equity method

323

—

—

399

8

730

Cost method investments

—

—

—

—

91

91

Carried interest

—

—

—

—

18

18

Total investments

698

299

31

399

168

1,595

Separate account assets

109,663

38,542

—

—

884

149,089

Separate account collateral held under securities lending agreements:

Equity securities

22,173

—

—

—

—

22,173

Debt securities

—

5,619

—

—

—

5,619

Total separate account collateral held under securities lending agreements

22,173

5,619

—

—

—

27,792

Investments of consolidated VIEs:

Private / public equity⁽³⁾

3

2

112

89

79

285

Equity securities

278

—

—

—

—

278

Debt securities

—

274

—

—

—

274

Other

—

—

—

63

—

63

Carried interest

—

—

—

—

108

108

Total investments of consolidated VIEs

281

276

112

152

187

1,008

Total

$
132,815

$
44,736

$
143

$
551

$
1,239

$
179,484

Liabilities:

Separate account collateral liabilities under securities lending agreements

$
22,173

$
5,619

$
—

$
—

$
—

$
27,792

Other liabilities⁽⁴⁾

—

7

115

—

—

122

Total

$
22,173

$
5,626

$
115

$
—

$
—

$
27,914

December 31, 2020 (in millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Investments Measured at NAV⁽¹⁾		Other⁽²⁾		December 31, 2020
Assets:
Investments
Debt securities:
Held-to-maturity investments	$	—	$	—	$	—	$	—	$	310	$	310
Trading securities		—		1,953		11		—		—		1,964
Total debt securities		—		1,953		11		—		310		2,274
Equity securities at FVTNI:
Equity securities/mutual funds		2,317		—		—		—		—		2,317
Equity method:
Equity and fixed income mutual funds		235		—		—		—		—		235
Hedge funds/funds of hedge funds		—		—		—		313		—		313
Private equity funds		—		—		—		315		—		315
Real assets funds		—		—		—		218		—		218
Total equity method		235		—		—		846		—		1,081
Bank loans		—		16		232		—		—		248
Federal Reserve Bank Stock		—		—		—		—		94		94
Carried interest		—		—		—		—		627		627
Other investments⁽³⁾		—		—		9		94		175		278
Total investments		2,552		1,969		252		940		1,206		6,919
Other assets⁽⁴⁾		205		13		—		—		—		218
Separate account assets		71,392		32,404		—		—		867		104,663
Separate account collateral held under securities lending agreements:
Equity securities		13,126		—		—		—		—		13,126
Debt securities		—		3,381		—		—		—		3,381
Total separate account collateral held under securities lending agreements		13,126		3,381		—		—		—		16,507
Total	$	87,275	$	37,767	$	252	$	940	$	2,073	$	128,307
Liabilities:
Separate account collateral liabilities under securities lending agreements	$	13,126	$	3,381	$	—	$	—	$	—	$	16,507
Other liabilities⁽⁵⁾		—		68		272		—		—		340
Total	$	13,126	$	3,449	$	272	$	—	$	—	$	16,847

⁽¹⁾	Amounts are comprised of certain investments measured at fair value using NAV (or its equivalent) as a practical expedient.

⁽²⁾

⁽³⁾	Level 3 ~~amounts include~~amount primarily includes direct investments in private equity companies held by consolidated private equity funds.

⁽⁴⁾	~~Amounts~~Level 1 amount includes a minority investment in a publicly traded company.

⁽⁵⁾

Level 3 Assets. Level 3 investments of consolidated VIEs of $114 million and $112 million at September 30, 2017 and December 31, 2016, respectively, related to direct investments in private equity companies held by consolidated private equity funds.

Direct investments in private equity companies may be valued using the market approach or the income approach, or a combination thereof, and were valued based on an assessment of each underlying investment, incorporating evaluation of additional significant third-party financing, changes in valuations of comparable peer companies, the business environment of the companies, market indices, assumptions relating to appropriate risk adjustments for nonperformance and legal restrictions on disposition, among other factors. The fair value derived from the methods used is evaluated and weighted, as appropriate, considering the reasonableness of the range of values indicated. Under the market approach, fair value may be determined by reference to multiples of market-comparable companies or transactions, including earnings before interest, taxes, depreciation and amortization (“EBITDA”) multiples. Under the income approach, fair value may be determined by discounting the expected cash flows to a single present value amount using current expectations about those future amounts. Unobservable inputs used in a discounted cash flow model may include projections of operating performance generally covering a five-year period and a terminal value of the private equity direct investment. For investments utilizing the discounted cash flow valuation technique, a significant increase (decrease) in the discount rate, risk premium or discount for lack of marketability in isolation could result in a significantly lower (higher) fair value measurement. For investments utilizing the market-comparable valuation technique, a significant increase (decrease) in the EBITDA multiple in isolation could result in a significantly higher (lower) fair value measurement.

Level 3 assets may include investments in CLOs and bank loans of consolidated CLOs, which were valued based on single-broker nonbinding quotes, and direct private equity investments, which were valued using the market ~~approach~~ or ~~the~~ income ~~approach as described above.~~approach.

Level 3 investments of $308 million and $252 million at September 30, 2021 and December 31, 2020, respectively, primarily included bank loans of a consolidated CLO.

Level 3 Liabilities.Level 3 ~~other~~ liabilities primarily include ~~recorded~~borrowings of a consolidated CLO, which were valued based on the fair value of the assets of the consolidated CLO less the fair value of the Company’s economic interest in the CLO, and contingent liabilities related to certain acquisitions, which were valued based upon discounted cash flow analyses using unobservable market data inputs.

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the Three Months Ended September 30, ~~2017~~2021

(in millions)	June 30, 2017		Realized and Unrealized Gains (Losses) in Earnings and OCI			Purchases		Sales and Maturities		Issuances and other Settlements⁽¹⁾		Transfers into Level 3		Transfers out of Level 3			September 30, 2017		Total Net Unrealized Gains (Losses) Included in Earnings⁽²⁾			June 30, 2021		Realized and Unrealized Gains (Losses)			Purchases		Sales and Maturities			Issuances and other Settlements⁽¹⁾		Transfers into Level 3		Transfers out of Level 3			September 30, 2021		Total Net Unrealized Gains (Losses) Included in Earnings⁽²⁾
Assets:
Investments:
Available-for-sale securities⁽³⁾	$	23	$	—		$	—	$	—	$	—	$	—	$	—		$	23
Debt securities:
Trading		4		—			—		—		—		—		(2	)		2				$	21	$	2		$	12	$	(5	)	$	—	$	—	$	—		$	30	$	2
Total debt securities																							21		2			12		(5	)		—		—		—			30		2
Private equity																							5		1			—		—			—		—		(1	)		5		1
Bank loans																							261		—			16		—			—		1		(5	)		273		—
Total investments		27		—			—		—		—		—		(2	)		25				$	287	$	3		$	28	$	(5	)	$	—	$	1	$	(6	)	$	308	$	3
Assets of consolidated VIEs - Private equity		113		1			—		—		—		—		—			114	$	1
Total Level 3 assets	$	140	$	1		$	—	$	—	$	—	$	—	$	(2	)	$	139
Liabilities:
Other liabilities⁽⁴⁾	$	218	$	(7	)	$	—	$	—	$	3	$	—	$	—		$	228	$	(7	)
Other liabilities																						$	298	$	(28	)	$	—	$	—		$	14	$	—	$	—		$	340	$	(28	)
Total Level 3 liabilities																						$	298	$	(28	)	$	—	$	—		$	14	$	—	$	—		$	340	$	(28	)

⁽¹⁾ Issuance and other settlements amount includes a contingent liability of $9 million in connection with the acquisition of Cachematrix in July 2017 (“Cachematrix Transaction”) and a contingent liability payment in connection with a prior acquisition.

⁽¹⁾	Amounts include proceeds from borrowings of a consolidated CLO and a contingent liability, partially offset by contingent liability payment related to a prior acquisition.

⁽²⁾

Earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities still held at the reporting date.

⁽³⁾	~~Amounts include investments in CLOs.~~

⁽⁴⁾	~~Other liabilities amount includes contingent liabilities in connection with certain acquisitions.~~

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the Nine Months Ended September 30, ~~2017~~

2021

(in millions)	December 31, 2016		Realized and Unrealized Gains (Losses) in Earnings and OCI			Purchases		Sales and Maturities		Issuances and other Settlements⁽¹⁾		Transfers into Level 3		Transfers out of Level 3⁽²⁾			September 30, 2017		Total Net Unrealized Gains (Losses) Included in Earnings⁽³⁾			December 31, 2020		Realized and Unrealized Gains (Losses)			Purchases		Sales and Maturities			Issuances and other Settlements⁽¹⁾		Transfers into Level 3		Transfers out of Level 3			September 30, 2021		Total Net Unrealized Gains (Losses) Included in Earnings⁽²⁾
Assets:
Investments:
Available-for-sale securities⁽⁴⁾	$	24	$	—		$	23	$	—	$	—	$	—	$	(24	)	$	23
Debt securities:
Trading		7		—			4		—		—		—		(9	)		2				$	11	$	2		$	24	$	(5	)	$	—	$	—	$	(2	)	$	30	$	2
Total debt securities																							11		2			24		(5	)		—		—		(2	)		30		2
Private equity																							9		1			—		—			—		—		(5	)		5		1
Bank loans																							232		—			45		—			—		11		(15	)		273		—
Total investments		31		—			27		—		—		—		(33	)		25				$	252	$	3		$	69	$	(5	)	$	—	$	11	$	(22	)	$	308	$	3
Assets of consolidated VIEs - Private equity		112		2			—				—		—		—			114	$	2
Total Level 3 assets	$	143	$	2		$	27	$	—	$	—	$	—	$	(33	)	$	139
Liabilities:
Other liabilities⁽⁵⁾	$	115	$	(2	)	$	—	$	—	$	111	$	—	$	—		$	228	$	(2	)
Other liabilities																						$	272	$	(32	)	$	—	$	—		$	36	$	—	$	—		$	340	$	(32	)
Total Level 3 liabilities																						$	272	$	(32	)	$	—	$	—		$	36	$	—	$	—		$	340	$	(32	)

⁽¹⁾ Issuance and other settlements amount includes $120 million and $9 million of contingent liabilities in connection with the acquisition of the equity infrastructure franchise of First Reserve in June 2017 (“First Reserve Transaction”) and the Cachematrix Transaction, respectively, and contingent liability payments in connection with certain prior acquisitions.

⁽²⁾ ~~Amounts include transfers out of Level 3 due to availability of observable market inputs from pricing vendors.~~

⁽³⁾ ~~Earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities still held at the reporting date.~~

⁽⁴⁾⁽¹⁾

Amounts include ~~investments in CLOs.~~proceeds from borrowings of a consolidated CLO and a contingent liability, partially offset by contingent liability payments related to prior acquisitions.

^(5) (2)

~~Other~~Earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities ~~amount includes contingent liabilities in connection with certain acquisitions.~~still held at the reporting date.

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the Three Months Ended September 30, ~~2016~~2020

(in millions)	June 30, 2016		Realized and Unrealized Gains (Losses) in Earnings and OCI			Purchases		Sales and Maturities			Issuances and other Settlements			Transfers into Level 3		Transfers out of Level 3		September 30, 2016		Total Net Unrealized Gains (Losses) Included in Earnings⁽¹⁾			June 30, 2020		Realized and Unrealized Gains (Losses)		Purchases		Sales and Maturities			Issuances and other Settlements⁽¹⁾			Transfers into Level 3		Transfers out of Level 3			September 30, 2020		Total Net Unrealized Gains (Losses) Included in Earnings⁽²⁾
Assets:
Investments:
Available-for-sale securities⁽²⁾	$	—	$	—		$	24	$	—		$	—		$	—	$	—	$	24
Debt securities:
Trading		3		—			2		—			—			—		—		5				$	10	$	—	$	1	$	—		$	—		$	—	$	—		$	11	$	—
Total debt securities																								10		—		1		—			—			—		—			11		—
Private equity																								16		—		—		(6	)		—			—		—			10		—
Bank loans																								229		—		—		(9	)		—			—		(3	)		217		—
Total investments		3		—			26		—			—			—		—		29				$	255	$	—	$	1	$	(15	)	$	—		$	—	$	(3	)	$	238	$	—
Assets of consolidated VIEs - Private equity		189		11			—		(6	)		—			—		—		194	$	11
Total Level 3 assets	$	192	$	11		$	26	$	(6	)	$	—		$	—	$	—	$	223
Liabilities:
Other liabilities⁽³⁾	$	121	$	(2	)	$	—	$	—		$	(5	)	$	—	$	—	$	118	$	(2	)
Other liabilities																							$	262	$	—	$	—	$	—		$	(1	)	$	—	$	—		$	261	$	—
Total Level 3 liabilities																							$	262	$	—	$	—	$	—		$	(1	)	$	—	$	—		$	261	$	—

⁽¹⁾	Amount includes proceeds from borrowings of a consolidated CLO and contingent payments related to certain acquisitions.

⁽²⁾	Earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities still held at the reporting date.

⁽²⁾	~~Amounts include investments in CLOs.~~

⁽³⁾	~~Other liabilities amount includes contingent liabilities in connection with certain acquisitions.~~

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the Nine Months Ended September 30, ~~2016~~

December 31,

Realized
and
Unrealized
Gains
(Losses) in
Earnings

Sales and

Issuances and
other

Transfers
into

Transfers
out of

September 30,

Total Net
Unrealized
Gains (Losses)
Included in

(in millions)

2015

and OCI

Purchases

Maturities

Settlements⁽¹⁾

Level 3

Level 3

2016

Earnings⁽²⁾

Assets:

Investments

Available-for-sale securities⁽³⁾

$
23

$
—

$
47

$
—

$
—

$
—

$
(46
)

$
24

Trading

2

—

6

—

—

—

(3
)

5

Total investments

25

—

53

—

—

—

(49
)

29

Assets of consolidated VIEs - Private equity

196

13

—

(15
)

—

—

—

194

$
13

Total Level 3 assets

$
221

$
13

$
53

$
(15
)

$
—

$
—

$
(49
)

$
223

Liabilities:

Other liabilities⁽⁴⁾

$
48

$
—

$
—

$
—

$
70

$
—

$
—

$
118

$
—

2020

⁽¹⁾ ~~Issuances and other settlements amount includes a contingent liability related to the BofA~~^® ~~Global Capital Management transaction in April 2016.~~

(in millions)	December 31, 2019		Realized and Unrealized Gains (Losses)			Purchases		Sales and Maturities			Issuances and other Settlements⁽¹⁾			Transfers into Level 3		Transfers out of Level 3			September 30, 2020		Total Net Unrealized Gains (Losses) Included in Earnings⁽³⁾
Assets:
Investments:
Debt securities:
Trading	$	8	$	—		$	3	$	—		$	—		$	—	$	—		$	11	$	—
Total debt securities		8		—			3		—			—			—		—			11		—
Private equity		9		—			8		(7	)		—			—		—			10		—
Bank loans		177		—			36		(9	)		—			16		(3	)		217		—
Total investments	$	194	$	—		$	47	$	(16	)	$	—		$	16	$	(3	)	$	238	$	—
Liabilities:
Other liabilities	$	388	$	(23	)	$	—	$	—		$	(150	)	$	—	$	—		$	261	$	(5	)
Total Level 3 liabilities	$	388	$	(23	)	$	—	$	—		$	(150	)	$	—	$	—		$	261	$	(5	)

^(2) (1)

Amount includes proceeds from borrowings of a consolidated CLO and contingent payments related to certain acquisitions.

⁽²⁾	Earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities still held at the reporting date.

⁽³⁾	~~Amounts include investments in CLOs.~~

⁽⁴⁾	~~Other liabilities amount includes contingent liabilities in connection with certain acquisitions.~~

Realized and Unrealized Gains (Losses) for Level 3 Assets and Liabilities. Realized and unrealized gains (losses) recorded for Level 3 assets and liabilities are reported in nonoperating income (expense) on the condensed consolidated statements of income. A portion of net income (loss) for consolidated sponsored investment funds ~~are~~is allocated to ~~noncontrolling interests~~NCI to reflect net income (loss) not attributable to the Company.

Transfers in and/or out of Levels. Transfers in and/or out of levels are reflected when significant inputs, including market inputs or performance attributes, used for the fair value measurement become observable/unobservable, or when the carrying value of certain equity method investments no longer represents fair value as determined under valuation methodologies.

Disclosures of Fair Value for Financial Instruments Not Held at Fair Value. At September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, the fair value of the Company’s financial instruments not held at fair value are categorized in the table below:

	September 30, 2017				December 31, 2016						September 30, 2021				December 31, 2020
(in millions)	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value		Fair Value Hierarchy		Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value		Fair Value Hierarchy
Financial Assets:
Financial Assets⁽¹⁾:
Cash and cash equivalents	$	6,165	$	6,165	$	6,091	$	6,091	Level 1	^{(1) (2)}	$	7,361	$	7,361	$	8,664	$	8,664	Level 1	^{(2) (3)}
Accounts receivable		3,183		3,183		2,350		2,350	Level 1	⁽³⁾
Cash and cash equivalents of consolidated VIEs		82		82		84		84	Level 1	^{(1) (2)}
Other assets		62		62		25		25	Level 1	^{(1) (4)}	$	48	$	48	$	69	$	69	Level 1	⁽⁴⁾

Financial Liabilities:
Accounts payable and accrued liabilities		1,652		1,652		1,094		1,094	Level 1	⁽³⁾
Long-term borrowings		5,000		5,248		4,915		5,165	Level 2	⁽⁵⁾	$	6,474	$	6,836	$	7,264	$	7,883	Level 2	⁽⁵⁾

⁽¹⁾	See Note 5, Investments, for further information on investments not held at fair value.

⁽²⁾	Cash and cash equivalents are carried at either cost or amortized cost, which approximates fair value due to their short-term maturities.

⁽²⁾⁽³⁾

At September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, approximately ~~$137~~$677 million and ~~$132~~$1,249 million, respectively, of money market funds were recorded within cash and cash equivalents on the condensed consolidated statements of financial condition. In addition, at September 30, 2017 and December 31, 2016, approximately $14 million and $13 million, respectively, of money market funds were recorded within cash and cash equivalents of consolidated VIEs. Money market funds are valued based on quoted market prices, or $1.00 per share, which generally is the NAV of the fund.

⁽³⁾⁽⁴⁾

Other assets include restricted cash and cash collateral deposited with certain derivative counterparties. The carrying ~~amounts~~values of ~~accounts receivable, accounts payable and accrued liabilities~~these assets approximate fair value due to their short-term ~~nature.~~maturities.

⁽⁴⁾	~~Other assets primarily include restricted cash.~~

⁽⁵⁾

Long-term borrowings are recorded at amortized cost, net of debt issuance costs. The fair value of the long-term borrowings, including the current portion of long-term borrowings, is ~~estimated~~determined using market prices at the end of September ~~2017~~2021 and December ~~2016,~~2020, respectively. See Note ~~10,~~ 14, Borrowings, for the fair value of each of the Company’s long-term borrowings.

Investments in Certain Entities that Calculate Net Asset Value Per ~~Share.~~Share

As a practical expedient to value certain investments that do not have a readily determinable fair value and have attributes of an investment company, the Company uses NAV as the fair value. The following tables list information regarding all investments in entities that use a fair value measurement to account for both their financial assets and financial liabilities in their calculation of a NAV per share (or equivalent).

September 30, 2017

September 30, 2021

(in millions)

Ref

Fair Value

Total

Unfunded

Commitments

Redemption

Frequency

Redemption

Notice Period

Ref

Fair Value

Total

Unfunded

Commitments

Redemption

Frequency

Redemption

Notice Period

Equity method:⁽¹⁾

Hedge funds/funds of hedge funds

(a)

249

Daily/Monthly (19%)

Quarterly (55%)

N/R (26%)

1 – 90 days

(a)

359

123

Daily/Monthly (21%)

Quarterly (21%)

N/R (58%)

1 – 90 days

Private equity funds

(b)

N/R

(b)

633

302

N/R

Real assets funds

(c)

265

111

Quarterly (85%)

N/R (15%)

60 days

(c)

213

229

Quarterly (21%)

N/R (79%)

60 days

Other

Daily/Monthly (66%)

N/R (34%)

3 – 5 days

Consolidated VIEs:

Consolidated sponsored investment

products:

Private equity funds of funds

(d)

N/R

(d)

N/R

Hedge fund

(a)

—

Quarterly

90 days

Real assets funds

(c)

N/R

(c)

106

N/R

Funds of hedge funds

N/R

Total

751

332

1,299

786

December 31, 2016

December 31, 2020

(in millions)

Ref

Fair Value

Total

Unfunded

Commitments

Redemption

Frequency

Redemption

Notice Period

Ref

Fair Value

Total

Unfunded

Commitments

Redemption

Frequency

Redemption

Notice Period

Equity method:⁽¹⁾

Hedge funds/funds of hedge funds

(a)

237

Daily/Monthly (21%)

Quarterly (51%)

N/R (28%)

1 – 90 days

(a)

313

101

Daily/Monthly (21%)

Quarterly (21%)

N/R (58%)

1 – 90 days

Private equity funds

(b)

N/R

(b)

315

372

N/R

Real assets funds

(c)

Quarterly (41%)

N/R (59%)

60 days

(c)

218

205

Quarterly (31%)

N/R (69%)

60 days

Other

Daily/Monthly (42%)

N/R (58%)

3 – 5 days

Consolidated VIEs:

Consolidated sponsored investment

products:

Private equity funds of funds

(d)

N/R

(d)

N/R

Hedge fund

(a)

—

Quarterly

90 days

Real assets funds

(c)

N/R

(c)

N/R

Total

551

157

940

779

N/R – not redeemable

⁽¹⁾	Comprised of equity method investments, which include ~~investments in~~ investment companies, which account for their financial assets and most financial liabilities under fair value measures; therefore, the Company’s investment in such equity method investees approximates fair value.

^(a)

This category includes hedge funds and funds of hedge funds that invest primarily in equities, fixed income securities, distressed credit, opportunistic and mortgage instruments, and other third-party hedge funds. The fair values of the investments have been estimated using the NAV of the Company’s ownership interest in partners’ capital. ~~It was estimated that~~The liquidation period for the investments in the funds that are not subject to redemption ~~will be liquidated over a weighted-average period of seven years~~is unknown at both September 30, ~~2017~~2021 and ~~approximately one year at~~ December 31, ~~2016.~~2020.

^(b)

This category includes ~~several~~ private equity funds that initially invest in nonmarketable securities of private companies, which ultimately may become public in the future. The fair values of these investments have been estimated using capital accounts representing the Company’s ownership interest in the funds as well as other performance inputs. The Company’s investment in each fund is not subject to redemption and is normally returned through distributions as a result of the liquidation of the underlying assets of the private equity ~~funds. It was estimated that~~funds. The liquidation period for the investments in these funds ~~will be liquidated over a weighted-average period of approximately five years~~is unknown at both September 30, ~~2017~~2021 and December 31, ~~2016.~~ 2020.

^(c)

This category includes several real assets funds that invest directly and indirectly in real estate ~~real estate related assets and~~or infrastructure. The fair values of the investments have been estimated using capital accounts representing the Company’s ownership interest in the funds. The Company’s investments that are not subject to redemption or are not currently redeemable are normally returned through distributions ~~as a result of the liquidation~~and realizations of the underlying assets of the ~~funds. It is estimated that~~funds. The liquidation period for the investments in ~~these~~the funds that are not subject to redemptions ~~will be liquidated over a weighted-average period of approximately eight years~~is unknown at both September 30, 2021 and December 31, 2020. The total remaining unfunded commitments to real assets funds were $335 million and $299 million at September 30, ~~2017~~2021 and ~~six years at~~ December 31, ~~2016.~~2020, respectively. The Company’s portion of the total remaining unfunded commitments was $295 million and $267 million at September 30, 2021 and December 31, 2020, respectively.

^(d)

This category includes the underlying third-party private equity funds within consolidated BlackRock sponsored private equity funds of funds. The fair values of the investments in the third-party funds have been estimated using capital accounts representing the Company’s ownership interest in each fund in the portfolio as well as other performance inputs. These investments are not subject to redemption or are not currently redeemable; however, for certain funds, the Company may sell or transfer its interest, which may need approval by the general partner of the underlying funds. Due to the nature of the investments in this category, the Company reduces its investment by distributions that are received through the realization of the underlying assets of the funds. The liquidation period for the underlying assets of these funds is unknown at both September 30, 2021 and December 31, 2020. The total remaining unfunded commitments to other third-party funds were ~~$165~~$3 million and ~~$56~~$7 million at September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively. The Company had contractual obligations to the consolidated funds of ~~$136~~$17 million at both September 30, ~~2017~~2021 and ~~$56 million at~~ December 31, ~~2016.~~2020.

Fair Value Option.

^(d) This category includes the underlying third-party private equity funds within consolidated BlackRock sponsored private equity funds of funds. The fair values of the investments in the third-party funds have been estimated using capital accounts representing the Company’s ownership interest in each fund in the portfolio as well as other performance inputs. These investments are not subject to redemption; however, for certain funds, the Company may sell or transfer its interest, which may need approval by the general partner of the underlying funds. Due to the nature of the investments in this category, the Company reduces its investment by distributions that are received through the realization of the underlying assets of the funds. It is estimated that the underlying assets of these funds will be liquidated over a weighted-average period of approximately five years at both

At September 30, ~~2017~~2021 and December 31, ~~2016. The total remaining unfunded commitments to other third-party funds were $20~~2020, the Company elected the fair value option for certain investments in CLOs of approximately $54 million and ~~$16~~$35 million, respectively, reported within investments.

In addition, the Company elected the fair value option for bank loans and borrowings of a consolidated CLO, recorded within investments and other liabilities, respectively. The following table summarizes the information related to these bank loans and borrowings at September 30, ~~2017~~2021 and December 31, ~~2016, respectively. The Company had contractual obligations to~~2020:

	September 30,			December 31,
(in millions)	2021			2020
CLO Bank loans:
Aggregate principal amounts outstanding	$	280		$	250
Fair value		282			248
Aggregate unpaid principal balance in excess of (less than) fair value	$	(2	)	$	2

CLO Borrowings:
Aggregate principal amounts outstanding	$	275		$	244
Fair value	$	278		$	246

At September 30, 2021, the principal amounts outstanding of the borrowings issued by the CLOs mature in 2030.

During the three and nine months ended September 30, 2021 and 2020, the net gains (losses) from the change in fair value of the bank loans and borrowings held by the consolidated ~~funds~~CLO were not material and were recorded in nonoperating (expense) on the condensed consolidated statements of ~~$24 million at both September 30, 2017~~income. The change in fair value of the assets and ~~December 31, 2016.~~liabilities included interest income and expense, respectively.

7.9. Derivatives and Hedging

The Company maintains a program to enter into swaps to hedge against market price and interest rate exposures with respect to certain seed investments in sponsored investment products. At September 30, ~~2017,~~2021 and December 31, 2020, the Company had outstanding total return swaps with aggregate notional values of approximately ~~$538 million. At December 31, 2016, the Company had outstanding total return swaps and interest rate swaps with aggregate notional values of approximately $572~~$801 million and ~~$42~~$833 million, respectively.

~~Gains (losses) on the total return swaps are recorded in nonoperating income (expense) and were $~~(~~26) million and $~~(~~90) million for the three and nine months ended September 30, 2017, respectively, and $~~(~~25) million and $~~(~~33) million for the three and nine months ended September 30, 2016, respectively.~~

~~Gains (losses) on the interest rate swaps are recorded in nonoperating income (expense) and were not material for the three and nine months ended September 30, 2017 and 2016.~~

The Company has entered into a derivative providing credit protection to a counterparty of approximately $17 million, representing the Company’s maximum risk of loss with respect to the provision of credit protection. The Company carries the derivative at fair value based on the expected discounted future cash outflows under the arrangement.

The Company executes forward foreign currency exchange contracts to mitigate the risk of certain foreign exchange movements. At September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, the Company had outstanding forward foreign currency exchange contracts with aggregate notional values of approximately ~~$1.3~~$2.2 billion and ~~$107~~$2.8 billion, respectively, and with expiration dates in October 2021 and January 2021, respectively.

At both September 30, 2021 and December 31, 2020, the Company had a derivative providing credit protection with a notional amount of approximately $17 million ~~respectively.~~

~~Gains (losses)~~to a counterparty, representing the Company’s maximum risk of loss with respect to the derivative. The Company carries the derivative at fair value based on the ~~forward foreign currency exchange contracts are recorded~~expected discounted future cash outflows under the arrangement.

The following table presents the fair values of derivative instruments recognized in ~~other general and administration expense and were $29 million and $58 million for~~ the ~~three and nine months ended~~condensed consolidated statements of financial condition at September 30, ~~2017, respectively. Gains~~2021 and December 31, 2020:

(in millions)	Assets					Liabilities
	Statement of Financial Condition	September 30,		December 31,		Statement of Financial Condition	September 30,		December 31,
Derivative instruments	Classification	2021		2020		Classification	2021		2020
Total return swaps	Other assets	$	22	$	—	Other liabilities	$	1	$	50
Forward foreign currency exchange contracts	Other assets		1		13	Other liabilities		28		5
Total		$	23	$	13		$	29	$	55

The following table presents realized and unrealized gains (losses) recognized in the condensed consolidated statements of income on ~~the forward foreign currency exchange contracts were not material for the three and nine months ended September 30, 2016.~~derivative instruments:

		Three Months Ended						Nine Months Ended
		September 30,						September 30,
(in millions)	Statement of Income	2021			2020			2021			2020
Derivative Instruments	Classification	Gains (Losses)						Gains (Losses)
Total return swaps	Nonoperating income (expense)	$	14		$	(42	)	$	(70	)	$	9
Forward foreign currency exchange contracts	General and administration expense		(46	)		64			(36	)		(34	)
Total gain (loss) from derivative instruments		$	(32	)	$	22		$	(106	)	$	(25	)

The Company consolidates certain sponsored investment funds, which may utilize derivative instruments as a part of the funds’ investment strategies. The ~~change~~changes in fair value of such derivatives, which isare recorded in nonoperating income (expense), ~~was~~were not material for the three and nine months ended September 30, ~~2017~~2021 and ~~2016.~~

~~The fair value of the outstanding derivatives mentioned above were not material at September 30, 2017 and December 31, 2016.~~2020.

See Note ~~12,~~ 15, Borrowings, in the ~~2016~~2020 Form 10-K for more information on the Company’s net investment hedge.

8.10. Goodwill

Goodwill activity during the nine months ended September 30, ~~2017~~2021 was as follows:

(in millions)

December 31, 2016

$
13,118

Acquisitions⁽¹⁾

123

Goodwill adjustments related to Quellos⁽²⁾

(15
)
September 30, 2017

$
13,226

(in millions)
December 31, 2020	$	14,551
Acquisitions⁽¹⁾		816
Other⁽²⁾		(7	)
September 30, 2021	$	15,360

⁽¹⁾

Amount includes $91 million of goodwill related to the First Reserve Transaction, which expanded the Company’s energy and power infrastructure platform and $32 million of goodwill related to the Cachematrix Transaction, which enhanced the Company’s technology and cash management capabilities. The total consideration paid for these acquisitions was approximately $231 million, including $129 million of contingent consideration at fair value at time of close.

⁽²⁾

The ~~decrease~~increase in goodwill during the nine months ended September 30, ~~2017~~2021 primarily relates to the Aperio Transaction, which closed on February 1, 2021. See Note 3, Acquisitions, for more information.

⁽²⁾

Amount resulted from a decline related to tax benefits realized from tax-deductible goodwill in excess of book goodwill from the acquisition of the fund-of-funds business of Quellos Group, LLC in October 2007 (the “Quellos Transaction” or “Quellos”). Goodwill related to the Quellos Transaction will continue to be reduced in future periods by the amount of tax benefits realized from tax-deductible goodwill in excess of book goodwill from the Quellos Transaction. The balance of the Quellos tax-deductible goodwill in excess of book goodwill was approximately ~~$176~~$51 million and ~~$200~~$74 million at September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively.

11. Intangible Assets

The carrying amounts of identifiable intangible assets are summarized as follows:

(in millions)

Indefinite-lived

Finite-lived

Total

December 31, 2016

$
17,178

$
185

$
17,363

Amortization expense

—

(77
)

(77
)
Acquisitions⁽¹⁾

—

114

114

September 30, 2017

$
17,178

$
222

$
17,400

(in millions)	Indefinite-lived		Finite-lived			Total
December 31, 2020	$	17,578	$	685		$	18,263
Acquisitions⁽¹⁾		—		322			322
Amortization expense		—		(109	)		(109	)
September 30, 2021	$	17,578	$	898		$	18,476

⁽¹⁾

In connection with the Aperio Transaction, which closed on February 1, 2021, the Company acquired $270 million of finite-lived customer relationships, $9 million of a finite-lived trade name and $8 million of finite-lived technology-related intangible assets, with weighted-average estimated lives of approximately 10 years, five years and three years, respectively. See Note 3, Acquisitions, for more information.

⁽¹⁾12. Leases

The ~~amount represents $110~~following table presents components of lease cost included in general and administration expense on the condensed consolidated statement of income:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in millions)	2021		2020		2021		2020
Lease cost:
Operating lease cost⁽¹⁾	$	50	$	37	$	128	$	110
Variable lease cost⁽²⁾		10		10		30		29
Total lease cost	$	60	$	47	$	158	$	139

⁽¹⁾	Amounts include short-term leases, which are immaterial for the three and nine months ended September 30, 2021 and 2020.

⁽²⁾	Amounts include operating lease payments, which may be adjusted based on usage, changes in an index or market rate, as well as common area maintenance charges and other variable costs not included in the measurement of right-of-use (“ROU”) assets and operating lease liabilities.

Supplemental information related to operating leases is summarized below:

	Nine Months Ended
	September 30,
(in millions)	2021		2020
Supplemental cash flow information:
Operating cash flows from operating leases included in the measurement
of operating lease liabilities	$	108	$	114

Supplemental noncash information:
ROU assets in exchange for operating lease liabilities	$	1,297	$	77

	September 30,			December 31,
	2021			2020
Lease term and discount rate:
Weighted-average remaining lease term		16	years		8	years
Weighted-average discount rate		3	%		3	%

13. Other Assets

At September 30, 2021 and December 31, 2020, the Company had $582 million and $399 million of ~~finite-lived~~equity method investments, respectively, recorded within other assets ~~related to~~on the ~~First Reserve Transaction~~condensed consolidated statements of financial condition.In accordance with GAAP, certain equity method investees do not account for both their financial assets and ~~$4 million of finite-lived assets related to~~liabilities under fair value measures; therefore, the ~~Cachematrix Transaction~~Company’s investment in such equity method investees may not represent fair value.

iCapital

On March 10, 2020, in connection with a ~~weighted average estimated life~~recapitalization of iCapital Network, Inc. (“iCapital”), BlackRock received additional stock in exchange for certain securities it held, which resulted in a nonoperating pre-tax gain of approximately $240 million in the condensed consolidated statement of income for the nine months ended September 30, 2020. Following this transaction, the Company accounts for its interest in iCapital as an equity method investment, which is included in other assets on the condensed consolidated statements of financial condition. During the three and ~~10 years,~~nine months ended September 30, 2021, BlackRock recorded a nonoperating, noncash, pre-tax gain of $107 million in the condensed consolidated statements of income in connection with iCapital’s most recent third-party equity financing. At September 30, 2021 and December 31, 2020, the carrying value of the Company’s interest in iCapital was approximately $401 million and $296 million, respectively.

~~10.~~

14. Borrowings

Short-Term Borrowings

~~2017~~

2021 Revolving Credit Facility. ~~The~~ In March 2021, the Company’s credit facility ~~has an~~was amended to increase the aggregate commitment amount ~~of $4.0~~to $4.4 billion and ~~was amended in April 2017~~ to extend the maturity date to ~~April 2022(the “2017~~March 2026 (the “2021 credit facility”). In addition, the amendment incorporated certain sustainability-linked pricing metrics into the agreement. Specifically, the Company’s applicable interest rate and commitment fee are subject to upward or downward adjustments on an annual basis if the Company achieves, or fails to achieve, certain specified targets. Interest on borrowings outstanding accrues at a rate based on the applicable London Interbank Offered Rate, or an applicable replacement benchmark, plus a spread. The ~~2017~~2021 credit facility permits the Company to request up to an additional $1.0 billion of borrowing capacity, subject to lender credit approval, increasing the overall size of the ~~2017~~2021 credit facility to an aggregate principal amount not to exceed ~~$5.0~~$5.4 billion. ~~Interest on borrowings outstanding accrues at a rate based on the applicable London Interbank Offered Rate plus a spread.~~ The ~~2017~~2021 credit facility requires the Company not to exceed a maximum leverage ratio (ratio of net debt to earnings before interest, taxes, depreciation and amortization, where net debt equals total debt less unrestricted cash) of 3 to 1, which was satisfied with a ratio of less than 1 to 1 at September 30, ~~2017.~~2021. The ~~2017~~2021 credit facility provides back-up liquidity to fund ongoing working capital for general corporate purposes and various investment opportunities. At September 30, ~~2017,~~2021, the Company had no0 amount outstanding under the ~~2017~~2021 credit facility.

Commercial Paper Program. The Company can issue unsecured commercial paper notes (the “CP Notes”) on a private-placement basis up to a maximum aggregate amount outstanding at any time of ~~$4.0~~$4 billion. The commercial paper program is currently supported by the ~~2017~~2021 credit facility. At September 30, ~~2017,~~2021, BlackRock had no0 CP Notes outstanding.

Long-Term Borrowings

The carrying value and fair value of long-term borrowings ~~estimated~~determined using market prices and EUR/USD foreign exchange ~~rates~~rate at September 30, ~~2017~~2021 included the following:

(in millions)	Maturity Amount		Unamortized Discount and Debt Issuance Costs			Carrying Value		Fair Value		Maturity Amount		Unamortized Discount and Debt Issuance Costs			Carrying Value		Fair Value
5.00% Notes due 2019	$	1,000	$	(1	)	$	999	$	1,067
4.25% Notes due 2021		750		(4	)		746		802
3.375% Notes due 2022		750		(4	)		746		781	$	750	$	—		$	750	$	766
3.50% Notes due 2024		1,000		(6	)		994		1,044		1,000		(2	)		998		1,071
1.25% Notes due 2025		828		(6	)		822		846		811		(3	)		808		851
3.20% Notes due 2027		700		(7	)		693		708		700		(4	)		696		767
3.25% Notes due 2029											1,000		(11	)		989		1,097
2.40% Notes due 2030											1,000		(6	)		994		1,034
1.90% Notes due 2031											1,250		(11	)		1,239		1,250
Total Long-term Borrowings	$	5,028	$	(28	)	$	5,000	$	5,248	$	6,511	$	(37	)	$	6,474	$	6,836

In May 2021, the Company fully repaid $750 million of 4.25% notes at maturity.

Long-term borrowings at December 31, ~~2016~~2020 had a carrying value of ~~$4.9~~$7.3 billion and a fair value of ~~$5.2~~$7.9 billion, determined using market prices at the end of December ~~2016.~~

~~2027 Notes~~. In March 2017, the Company issued $700 million in aggregate principal amount of 3.20% senior unsecured and unsubordinated notes maturing on March 15, 2027 (the “2027 Notes”). Interest is payable semi-annually on March 15 and September 15 of each year, commencing September 15, 2017, and is approximately $22 million per year. The 2027 Notes may be redeemed prior to maturity at any time in whole or in part at the option of the Company at a “make-whole” redemption price. The unamortized discount and debt issuance costs are being amortized over the remaining term of the 2027 Notes.

~~In April 2017, the net proceeds of the 2027 Notes were used to fully repay $700 million in aggregate principal amount outstanding of 6.25% notes prior to their maturity in September 2017.~~31, 2020.

See Note ~~12,~~ 15, Borrowings, in the ~~2016~~2020 Form 10-K for more information regarding the Company’s borrowings.

~~11.~~15. Commitments and Contingencies

Investment Commitments. At September 30, ~~2017,~~2021, the Company had ~~$328~~$905 million of various capital commitments to fund sponsored investment ~~funds,~~products, including ~~consolidated VIEs.~~CIPs. These ~~funds~~products include private equity funds, real assets funds and opportunistic funds. This amount excludes additional commitments made by consolidated funds of funds to underlying third-party funds as third-party noncontrolling interest holders have the legal obligation to fund the respective commitments of such funds of funds. Generally, the timing of the funding of these commitments is unknown and the commitments are callable on demand at any time prior to the expiration of the commitment. These unfunded commitments are not recorded on the condensed consolidated statements of financial condition. These commitments do not include potential future commitments approved by the Company that are not yet legally binding. The Company intends to make additional capital commitments from time to time to fund additional investment products for, and with, its clients.

~~Lease Commitment.~~In May 2017, the Company entered into an agreement with 50 HYMC Owner LLC, for the lease of approximately 847,000 square feet of office space located at 50 Hudson Yards, New York, New York. The term of the lease is twenty years from the date that rental payments begin, expected to occur in May 2023, with the option to renew for a specified term.

~~Future minimum commitments of annual base rental payments under this operating lease are as follows:~~

(in millions)

Year
Amount

2023
$
34

2024

51

2025

51

2026

51

2027

51

Thereafter

1,007

Total
$
1,245

Contingencies

Contingent Payments Related to Business Acquisitions. In connection with certain acquisitions, BlackRock is required to make contingent payments, subject to achieving specified performance targets, which may include revenue ~~related to~~from acquired ~~contracts or new capital commitments for certain products.~~contracts. The fair value of the remaining aggregate contingent payments at September 30, ~~2017~~2021 totaled ~~$228~~$62 million ~~including $125 million related to the First Reserve Transaction,~~ and is included in other liabilities on the condensed consolidated statements of financial condition.

Other Contingent Payments.The Company acts as the portfolio manager in a series of derivative transactions and has a maximum potential exposure of $17 million between the Company and counterparty. See Note 7, 9, Derivatives and Hedging, for further discussion.

Legal Proceedings.From time to time, BlackRock receives subpoenas or other requests for information from various ~~U.S.~~US federal and state governmental and ~~domestic~~regulatory authorities and international governmental and regulatory authorities in connection with ~~certain~~ industry-wide or other investigations or proceedings. It is BlackRock’s policy to cooperate fully with such ~~inquiries.~~matters. The Company, ~~and~~ certain of its subsidiaries and employees have been named as defendants in various legal actions, including arbitrations and other litigation arising in connection with BlackRock’s activities. Additionally, ~~BlackRock advised~~BlackRock-advised investment portfolios may be subject to lawsuits, any of which potentially could harm the investment returns of the applicable portfolio or result in the Company being liable to the portfolios for any resulting damages.

On May 27, 2014, certain purported investors in the BlackRock Global Allocation Fund, Inc. and the BlackRock Equity Dividend Fund (collectively, the “Funds”) filed a consolidated complaint (the “Consolidated Complaint”) in the U.S. District Court for the District of New Jersey against BlackRock Advisors, LLC, BlackRock Investment Management, LLC and BlackRock International Limited under the caption ~~In re BlackRock Mutual Funds Advisory Fee Litigation~~. The Consolidated Complaint, which purports to be brought derivatively on behalf of the Funds, alleges that the defendants violated Section 36(b) of the Investment Company Act by receiving allegedly excessive investment advisory fees from the Funds. On February 24, 2015, the same plaintiffs filed another complaint in the same court against BlackRock Investment Management, LLC and BlackRock Advisors, LLC. The allegations and legal claims in both complaints are substantially similar, with the new complaint purporting to challenge fees received by defendants after the plaintiffs filed their prior complaint. Both complaints seek, among other things, to recover on behalf of the Funds all allegedly excessive advisory fees received by defendants in the twelve month period preceding the start of each lawsuit, along with purported lost investment returns on those amounts, plus interest. The defendants believe the claims in both lawsuits are without merit and intend to vigorously defend the actions. On September 25, 2017, the defendants filed a motion for summary judgment to dismiss the lawsuit.

16, 2015 collapse of a balcony at the Library Gardens apartment complex in Berkeley, California (the “Property”). The Property is indirectly owned by the Granite Fund, which is managed by BRA. The plaintiffs also named as defendants in the lawsuits Greystar, which manages the Property, and certain other non-BlackRock related entities, including the developer of the Property, building contractors and building materials suppliers. The plaintiffs allege, among other things, that the BlackRock Parties were negligent in their ownership, control and maintenance of the Property’s balcony, and seek monetary, including punitive, damages. Additionally, on March 16, 2016, three former tenants of the Library Gardens apartment unit that experienced the balcony collapse sued the BlackRock Parties. The former tenants, who witnessed (but were not physically injured in) the accident make allegations virtually identical to those in the other previously filed actions and claim that, as a result of the collapse, they suffered unspecified emotional damage. Several defendants also filed cross-complaints alleging a variety of claims, including claims against the BlackRock Parties for contribution, negligence, and declaratory relief. BlackRock, Inc. believes the claims against it are without merit and intends to vigorously defend the actions. A trial on all claims is scheduled to begin on February 5, 2018.

~~On June 16, 2016,~~ ~~iShares~~ ~~Trust, BlackRock, Inc. and certain of its advisory affiliates, and the directors and certain officers of the~~ ~~iShares~~ ~~ETFs were named as defendants in a purported class action lawsuit filed in California state court. The lawsuit was filed by investors in certain~~ ~~iShares~~ ETFs (the "ETFs"), and alleges the defendants violated the federal securities laws, purportedly by failing to adequately disclose in prospectuses issued by the ETFs the risks to the ETFs’ shareholders in the event of a "flash crash." Plaintiffs seek unspecified monetary damages. The Plaintiffs’ complaint was dismissed in December 2016 and on January 6, 2017, plaintiffs filed an amended complaint. The defendants filed a motion for judgment on the pleadings dismissing that complaint. On September 18, 2017, the court dismissed the lawsuit.

On April 5, 2017, BlackRock, Inc., BlackRock Institutional Trust Company, N.A. (“BTC”), the BlackRock, Inc. Retirement Committee and various sub-committees, and a BlackRock employee were named as defendants in a purported class action lawsuit brought in the ~~U.S.~~US District Court for the Northern District of California by a former employee on behalf of all participants and beneficiaries in the BlackRock employee 401(k) Plan (the “Plan”) ~~participants and beneficiaries in the Plan~~ from April 5, 2011 to the present. The lawsuit generally alleges that the defendants breached their duties towards Plan participants in violation of the Employee Retirement Income Security Act of 1974 by, among other things, offering investment options that were overly expensive, underperformed unaffiliated peer funds, focused disproportionately on active versus passive strategies, and were unduly concentrated ~~with~~in investment options managed by BlackRock. ~~While the complaint does not contain any specific amount in alleged damages, it claims that the purported underperformance and hidden fees cost Plan participants more than $60 million.~~ On October ~~10,~~18, 2017, the plaintiffs filed an Amended Complaint, which, among other things, ~~adds~~added as defendants certain current and former members of the BlackRock Retirement and Investment Committees. The Amended Complaint also ~~includes~~included a new purported class claim on behalf of investors in certain ~~Collective Trust Funds (“CTFs”)~~CTFs managed by BTC. Specifically, the plaintiffs allege that BTC, ~~exercised~~as fiduciary ~~authority over its compensation for~~to the CTFs, engaged in self-dealing by, most significantly, selecting itself as the securities lending ~~services~~agent on terms that the plaintiffs claim were excessive. The Amended Complaint also alleged that BlackRock took undue risks in its management of securities lending cash reinvestment vehicles during the financial crisis. On August 23, 2018, the court granted permission to the ~~CTFs. The~~plaintiffs to file a Second Amended Complaint (“SAC”) which added as defendants ~~believe~~ the BlackRock, Inc. Management Development and Compensation Committee, the Plan’s independent investment consultant and the Plan’s Administrative Committee and its members. On October 22, 2018, BlackRock filed a motion to dismiss the SAC, and on June 3, 2019, the plaintiffs filed a motion seeking to certify both the Plan and the CTF classes. On September 3, 2019, the court granted BlackRock’s motion to dismiss part of the plaintiffs’ claim seeking to recover alleged losses in the securities lending vehicles but denied the motion to dismiss in all other respects. On February 11, 2020, the court denied the plaintiffs’ motion to certify the CTF class and granted their motion to certify the Plan class. On April 27, 2020, the Ninth Circuit denied the plaintiffs’ request to immediately appeal the class certification ruling. On September 24, 2020, the parties cross-moved for summary judgment, both of which were denied on January 12, 2021. On February 5, 2021, the parties reached a settlement in principle for $9.65 million to resolve the remaining claims in the lawsuit, and this ~~lawsuit are without merit~~settlement was presented to the court for approval on March 23, 2021. There were no class member objections to the settlement following notice, and ~~intend~~the court granted final approval of the settlement on November 3, 2021. We expect a final judgment to ~~vigorously defend~~be entered in the ~~action.~~

district court, and barring the filing of any appeals within the appeal period, the resolution of the case will be final.

Management, after consultation with legal counsel, currently does not anticipate that the aggregate liability arising out of regulatory matters or lawsuits will have a material effect on BlackRock’s results of operations, financial position, or cash flows. However, there is no assurance as to whether any such pending or threatened matters will have a material effect on BlackRock’s results of operations, financial position or cash flows in any future reporting period. Due to uncertainties surrounding the outcome of these matters, management cannot reasonably estimate the possible loss or range of loss that may arise from these matters.

Indemnifications. In the ordinary course of business or in connection with certain acquisition agreements, BlackRock enters into contracts pursuant to which it may agree to indemnify third parties in certain circumstances. The terms of these indemnities vary from contract to contract and the amount of indemnification liability, if any, cannot be determined or the likelihood of any liability is considered remote. Consequently, no liability has been recorded on the condensed consolidated statements of financial condition.

In connection with securities lending transactions, BlackRock has ~~issued certain indemnifications~~agreed to indemnify certain securities lending clients against potential loss resulting from a borrower’s failure to fulfill its obligations under the securities lending agreement should the value of the collateral pledged by the borrower at the time of default be insufficient to cover the borrower’s obligation under the securities lending agreement. AtThe amount of securities on loan as of September 30, ~~2017,~~2021 and subject to this type of indemnification was $279 billion. In the ~~Company indemnified certain of its clients for their securities~~Company’s capacity as lending ~~loan balances of approximately $197.6 billion. The Company held, as~~ agent, cash and securities totaling ~~$210.6~~$299 billion were held as collateral for indemnified securities on loan at September 30, ~~2017.~~2021. The fair value of these indemnifications was not material at September 30, ~~2017.~~2021.

16. Revenue

The table below presents detail of revenue for the three and nine months ended September 30, 2021 and 2020 and includes the product mix of investment advisory, administration fees and securities lending revenue, and performance fees.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in millions)	2021		2020		2021		2020
Investment advisory, administration fees and securities lending revenue:
Equity:
Active	$	674	$	457	$	1,891	$	1,236
ETFs		1,212		880		3,436		2,551
Non-ETF Index		207		164		581		505
Equity subtotal		2,093		1,501		5,908		4,292
Fixed income:
Active		561		498		1,631		1,443
ETFs		304		297		893		817
Non-ETF Index		121		113		350		354
Fixed income subtotal		986		908		2,874		2,614
Multi-asset		369		289		1,041		852
Alternatives:
Illiquid alternatives		166		140		501		416
Liquid alternatives		163		132		460		361
Currency and commodities⁽¹⁾		55		51		163		118
Alternatives subtotal		384		323		1,124		895
Long-term		3,832		3,021		10,947		8,653
Cash management		111		204		345		593
Total investment advisory, administration fees and securities lending revenue		3,943		3,225		11,292		9,246
Investment advisory performance fees:
Equity		8		4		70		29
Fixed income		2		9		31		13
Multi-asset		—		10		17		13
Alternatives:
Illiquid alternatives		50		6		147		55
Liquid alternatives		285		503		549		575
Alternatives subtotal		335		509		696		630
Total performance fees		345		532		814		685
Technology services revenue		320		282		942		834
Distribution fees:
Retrocessions		294		188		796		519
12b-1 fees (US mutual fund distribution fees)		91		85		263		254
Other		16		15		51		44
Total distribution fees		401		288		1,110		817
Advisory and other revenue:
Advisory		13		14		37		48
Other		28		28		73		97
Total advisory and other revenue		41		42		110		145
Total revenue	$	5,050	$	4,369	$	14,268	$	11,727

⁽¹⁾ Amounts include commodity ETFs.

The tables below present the investment advisory, administration fees and securities lending revenue by client type and investment style:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in millions)	2021		2020		2021		2020
By client type:
Retail	$	1,291	$	938	$	3,647	$	2,635
ETFs		1,571		1,228		4,493		3,487
Institutional:
Active		684		594		1,991		1,714
Index		286		261		816		817
Total institutional		970		855		2,807		2,531
Long-term		3,832		3,021		10,947		8,653
Cash management		111		204		345		593
Total	$	3,943	$	3,225	$	11,292	$	9,246

By investment style:
Active	$	1,928	$	1,511	$	5,509	$	4,292
Index and ETFs		1,904		1,510		5,438		4,361
Long-term		3,832		3,021		10,947		8,653
Cash management		111		204		345		593
Total	$	3,943	$	3,225	$	11,292	$	9,246

Investment advisory and administration fees – remaining performance obligation

The tables below present estimated investment advisory and administration fees expected to be recognized in the future related to the unsatisfied portion of the performance obligations at September 30, 2021 and 2020:

September 30, 2021

	Remainder of
(in millions)	2021			2022		2023		2024	Thereafter		Total
Investment advisory and administration fees:
Alternatives⁽¹⁾⁽²⁾	$	45	$	157	$	143	$	85	$	51	$	481

September 30, 2020

	Remainder of
(in millions)	2020			2021		2022		2023	Thereafter		Total
Investment advisory and administration fees:
Alternatives⁽¹⁾⁽²⁾	$	33	$	125	$	108	$	92	$	61	$	419

⁽¹⁾

Investment advisory and administration fees include management fees related to certain alternative products, which are based on contractual committed capital outstanding at September 30, 2021 and 2020. Actual management fees could be higher to the extent additional committed capital is raised. These fees are generally billed on a quarterly basis in arrears.

⁽²⁾	The Company elected the following practical expedients and therefore does not include amounts related to (1) performance obligations with an original duration of one year or less, and (2) variable consideration related to future service periods.

Change in Deferred Carried Interest Liability

The table below presents changes in the deferred carried interest liability, which is included in other liabilities on the condensed consolidated statements of financial condition, for the three and nine months ended September 30, 2021 and 2020:

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
(in millions)	2021			2020		2021			2020
Beginning balance	$	1,132		$	418	$	584		$	483
Net increase (decrease) in unrealized allocations		277			29		904			4
Performance fee revenue recognized		(43	)		—		(122	)		(40	)
Ending balance	$	1,366		$	447	$	1,366		$	447

Technology services revenue – remaining performance obligation

The tables below present estimated technology services revenue expected to be recognized in the future related to the unsatisfied portion of the performance obligations at September 30, 2021 and 2020:

September 30, 2021

	Remainder of
(in millions)	2021			2022		2023		2024	Thereafter		Total
Technology services revenue⁽¹⁾⁽²⁾	$	38	$	83	$	43	$	22	$	18	$	204

September 30, 2020

	Remainder of
(in millions)	2020			2021		2022		2023	Thereafter		Total
Technology services revenue⁽¹⁾⁽²⁾	$	37	$	95	$	47	$	22	$	18	$	219

⁽¹⁾	Technology services revenue primarily includes upfront payments from customers, which the Company generally recognizes as services are performed.

⁽²⁾	The Company elected the following practical expedients and therefore does not include amounts related to (1) performance obligations with an original duration of one year or less, and (2) variable consideration related to future service periods.

In addition to amounts disclosed in the tables above, certain technology services contracts require fixed minimum fees, which are billed on a monthly or quarterly basis in arrears. The Company recognizes such revenue as services are performed. As of September 30, 2021, the estimated fixed minimum fees for the remainder of the year approximated $193 million. The term for these contracts, which are either in their initial or renewal period, ranges from one to five years.

The table below presents changes in the technology services deferred revenue liability for the three and nine months ended September 30, 2021 and 2020, which is included in other liabilities on the condensed consolidated statements of financial condition:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(in millions)	2021			2020			2021			2020
Beginning balance	$	107		$	108		$	123		$	116
Additions ⁽¹⁾		28			30			72			88
Revenue recognized that was included in the beginning balance		(31	)		(33	)		(91	)		(99	)
Ending balance	$	104		$	105		$	104		$	105

⁽¹⁾	Amounts are net of revenue recognized.

~~12.~~

17. Stock-Based Compensation

Restricted Stock and RSUs.

Restricted stock and restricted stock units (“RSUs”) activity for the nine months ended September 30, ~~2017~~2021 is summarized below.

Outstanding at	Restricted Stock and RSUs			Weighted- Average Grant Date Fair Value		Restricted Stock and RSUs			Weighted- Average Grant Date Fair Value
December 31, 2016		2,987,588		$	318.04
December 31, 2020							2,139,930		$	489.81
Granted		1,061,915		$	377.36		875,480		$	747.49
Converted		(1,363,701	)	$	320.27		(745,474	)	$	506.78
Forfeited		(39,164	)	$	338.57		(54,874	)	$	571.05
September 30, 2017⁽¹⁾		2,646,638		$	340.39
September 30, 2021							2,215,062		$	583.93

⁽¹⁾	~~At September 30, 2017, approximately 2.3 million awards are expected to vest and 0.3 million awards have vested but have not been converted.~~

In January ~~2017,~~2021, the Company granted ~~699,991~~470,253 RSUs or shares of restricted stock to employees as part of ~~2016~~2020 annual incentive compensation that vest ratably over three years from the date of grant and ~~277,313~~247,621 RSUs or shares of restricted stock to employees that cliff vest 100% on January 31, ~~2020.~~2024. The Company values restricted stock and RSUs at their grant-date fair value as measured by BlackRock’s common stock price. The total fair market value of RSUs/restricted stock granted to employees during the nine months ended September 30, ~~2017~~2021 was ~~$401~~$654 million.

At September 30, ~~2017,~~2021, the intrinsic value of outstanding RSUs was ~~$1.2~~$1.9 billion, reflecting a closing stock price of ~~$447.09.~~$838.66.

At September 30, ~~2017,~~2021, total unrecognized stock-based compensation expense related to unvested RSUs was ~~$351~~$607 million. The unrecognized compensation cost is expected to be recognized over the remaining weighted-average period of ~~1.1~~1.2 years.

Performance-Based RSUs.

Performance-based RSU activity for the nine months ended September 30, ~~2017~~2021 is summarized below.

Outstanding at	Performance- Based RSUs			Weighted- Average Grant Date Fair Value		Performance- Based RSUs			Weighted- Average Grant Date Fair Value
December 31, 2016		610,371		$	315.65
December 31, 2020							700,217		$	494.51
Granted		294,584		$	375.27		162,029		$	739.22
Additional shares granted due to attainment of performance measures							4,545		$	566.44
Converted							(193,872	)	$	566.44
Forfeited		(1,430	)	$	296.12		(1,584	)	$	410.32
September 30, 2017		903,525		$	335.12
September 30, 2021							671,335		$	533.48

In January ~~2017,~~2021, the Company granted ~~293,385~~162,029 performance-based RSUs to certain employees that cliff vest 100% on January 31, ~~2020.~~2024. These awards are amortized over a service period of three years. The number of shares distributed at vesting could be higher or lower than the original grant based on the level of attainment of predetermined Company performance measures. In January 2021, the Company granted 4,545 additional RSUs to certain employees based on the attainment of Company performance measures during the performance period.

The Company initially values performance-based RSUs at their grant-date fair value as measured by BlackRock’s common stock price. The total grant-date fair market value of performance-based RSUs granted to employees during the nine months ended September 30, ~~2017~~2021 was ~~$111~~$122 million.

At September 30, ~~2017,~~2021, the intrinsic value of outstanding performance-based RSUs was ~~$404~~$563 million, reflecting a closing stock price of ~~$447.09.~~$838.66.

At September 30, ~~2017,~~2021, total unrecognized stock-based compensation expense related to unvested performance-based awards was ~~$137~~$190 million. The unrecognized compensation cost is expected to be recognized over the remaining weighted-average period of ~~1.4~~1.2 years.

~~Market~~ See Note 18, Stock-Based Compensation, in the 2020 Form 10-K for more information on performance-based RSUs.

Performance-based ~~RSUs.~~ Stock Options.

~~Market performance-based RSUs~~Stock option activity for the nine months ended September 30, ~~2017~~2021 is summarized below.

Outstanding at

Market
Performance-
Based RSUs

Weighted-
Average
Grant Date
Fair Value

December 31, 2016

803,474

$
151.20

Converted

(517,138
)

$
126.76

September 30, 2017⁽¹⁾

286,336

$
195.33

Outstanding at	Shares Under Option			Weighted Average Exercise Price
December 31, 2020		1,915,792		$	513.50
Forfeited		(28,742	)	$	513.50
September 30, 2021		1,887,050		$	513.50

⁽¹⁾ ~~The market~~Vesting of the performance-based ~~RSUs require that separate 15%, 25%~~stock options is contingent upon the achievement of obtaining 125% of BlackRock's grant-date stock price within five years from the grant date and ~~35% share price appreciation targets be achieved~~the attainment of Company performance measures during the ~~six-year term~~four-year performance period. If both hurdles are achieved, the award will vest in 3 equal installments at the end of ~~the awards.~~2022, 2023 and 2024, respectively. The ~~awards are split into three tranches and each tranche may vest if the specified target increase~~stock price hurdle was achieved in ~~share price is met. At September 30, 2017, approximately 0.3 million awards are expected to vest.~~ December of 2020.

~~See Note 14,~~ ~~Stock-Based Compensation,~~ ~~in the 2016 Form 10-K for more information on market performance-based RSUs.~~

At September 30, ~~2017, the intrinsic value of outstanding market performance-based RSUs was $128 million reflecting a closing stock price of $447.09.~~

~~At September 30, 2017,~~2021, total unrecognized stock-based compensation expense related to unvested ~~market~~ performance-based ~~awards~~stock options was $4$55 million. The unrecognized compensation cost is expected to be recognized over the remaining weighted-average period of ~~less than one year.~~

~~Long-Term Incentive Plans Funded by PNC.~~ Under a share surrender agreement, PNC committed to provide up to 4 million shares of BlackRock stock, held by PNC, to fund certain BlackRock long-term incentive plans (“LTIP”), including performance-based and market performance-based RSUs. The current share surrender agreement commits PNC to provide BlackRock Series C nonvoting participating preferred stock to fund the remaining committed shares. As of September 30, 2017, 3.8 million shares had been surrendered by PNC.

~~517,138 shares were surrendered by PNC in the first quarter of 2017.~~

2.2 years. At September 30, ~~2017,~~2021, the weighted-average remaining ~~shares committed by PNC~~life of ~~0.2 million were available to fund certain future long-term incentive awards.~~the awards is approximately 5.2 years.

See Note 18, Stock-Based Compensation, in the 2020 Form 10-K for more information on performance-based stock options.

~~13.~~

18. Net Capital Requirements

The Company is required to maintain net capital in certain regulated subsidiaries within a number of jurisdictions, which is partially maintained by retaining cash and cash equivalent investments in those subsidiaries or jurisdictions. As a result, such subsidiaries of the Company may be restricted in their ability to transfer cash between different jurisdictions and to their parents. Additionally, transfers of cash between international jurisdictions ~~including repatriation to the United States,~~ may have adverse tax consequences that could discourage such transfers.

At September 30, ~~2017,~~2021, the Company was required to maintain approximately ~~$1.7~~$2.4 billion in net capital in certain regulated subsidiaries, including ~~BlackRock Institutional Trust Company, N.A.~~BTC (a wholly owned subsidiary of the Company that is chartered as a national bank whose powers are limited to trust and other fiduciary activities and which is subject to regulatory capital requirements administered by the US Office of the Comptroller of the Currency), entities regulated by the Financial Conduct Authority and Prudential Regulation Authority in the ~~United Kingdom,~~UK, and the Company’s broker-dealers. The Company was in compliance with all applicable regulatory net capital requirements.

~~14.~~19. Accumulated Other Comprehensive Income (Loss)

The following ~~tables present~~table presents changes in ~~accumulated other comprehensive income (loss) by component~~AOCI for the three and nine months ended September 30, ~~2017~~2021 and ~~2016:~~2020:

(in millions)

Foreign
currency
translation
adjustments⁽¹⁾

Other⁽²⁾

Total

For the Three Months Ended September 30, 2017

June 30, 2017

$
(579
)

$
4

$
(575
)
Net other comprehensive income (loss) for
the three months ended September 30, 2017

102

—

102

September 30, 2017

$
(477
)

$
4

$
(473
)
For the Nine Months Ended September 30, 2017

December 31, 2016

$
(721
)

$
5

$
(716
)
Net other comprehensive income (loss) for
the nine months ended September 30, 2017

244

(1
)

243

September 30, 2017

$
(477
)

$
4

$
(473
)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(in millions)	2021			2020			2021			2020
Beginning balance	$	(388	)	$	(781	)	$	(337	)	$	(571	)
Foreign currency translation adjustments⁽¹⁾		(138	)		180			(189	)		(30	)
Ending balance	$	(526	)	$	(601	)	$	(526	)	$	(601	)

⁽¹⁾

~~Amount~~Amounts for the three ~~and nine~~ months ended September 30, ~~2017 includes~~2021 and 2020 include a ~~loss~~gain from a net investment hedge of ~~$18~~$14 million (net of tax expense of $5 million) and a loss of $26 million (net of tax benefit of $8 million), respectively. Amounts for the nine months ended September 30, 2021 and 2020 include a gain from a net investment hedge of $34 million (net of tax expense of $11 million) and ~~$56~~a loss of $27 million (net of a tax benefit of ~~$33~~$8 million), respectively.

⁽²⁾ ~~Other includes amounts~~

20. Capital Stock

Share Repurchases. During the nine months ended September 30, 2021, the Company repurchased 1.1 million common shares under the Company’s existing share repurchase program for approximately $900 million. At September 30, 2021, there were 3.9 million shares still authorized to be repurchased under the program.

21. Income Taxes

Income tax expense for the nine months ended September 30, 2021 included $171 million noncash net expense related to ~~benefit plans~~the revaluation of certain deferred tax assets and ~~available-for-sale investments.~~

(in millions)

Foreign
currency
translation
adjustments⁽¹⁾

Other⁽²⁾

Total

For the Three Months Ended September 30, 2016

June 30, 2016

$
(565
)

$
5

$
(560
)

Net other comprehensive income (loss) for
the three months ended September 30, 2016

(38
)

—

(38
)

September 30, 2016

$
(603
)

$
5

$
(598
)

For the Nine Months Ended September 30, 2016

December 31, 2015

$
(452
)

$
4

$
(448
)

Net other comprehensive income (loss) for
the nine months ended September 30, 2016

(151
)

1

(150
)

September 30, 2016

$
(603
)

$
5

$
(598
)

⁽¹⁾~~Amount~~liabilities as a result of legislation enacted in the UK increasing its corporate tax rate. Income tax expense for the nine months ended September 30, 2021, also reflected $42 million of discrete tax benefits primarily related to stock-based compensation awards that vested in the first quarter of 2021.

Income tax expense for the nine months ended September 30, 2020, included a discrete tax benefit of $241 million recognized in connection with the previously reported charitable contribution of BlackRock’s remaining 20% stake in PennyMac Financial Services, Inc. (the “Charitable Contribution”) and $78 million of discrete tax benefits, including benefits related to stock-based compensation awards that vested in the first quarter of 2020.

The three and nine months ended September 30, ~~2016 includes a loss from a~~2020 income tax expense also included the previously disclosed $54 million noncash net ~~investment hedge of $5 million (net of a tax benefit of $4 million) and $16 million (net of a tax benefit of $10 million), respectively.~~

⁽²⁾ ~~Other includes amounts related to benefit plans and available-for-sale investments.~~

~~15. Capital Stock~~

~~Nonvoting Participating Preferred Stock. The Company’s preferred shares authorized, issued and outstanding consisted of the following:~~

September 30,

December 31,

2017

2016

Series A

Shares authorized, $0.01 par value

20,000,000

20,000,000

Shares issued and outstanding

—

—

Series B

Shares authorized, $0.01 par value

150,000,000

150,000,000

Shares issued and outstanding⁽¹⁾

823,188

823,188

Series C

Shares authorized, $0.01 par value

6,000,000

6,000,000

Shares issued and outstanding⁽¹⁾

246,522

763,660

Series D

Shares authorized, $0.01 par value

20,000,000

20,000,000

Shares issued and outstanding

—

—

⁽¹⁾	~~Shares held by PNC.~~

~~Share Repurchases~~. The Company repurchased 2.1 million common shares in open market transactions under the share repurchase program for approximately $825 million during the nine months ended September 30, 2017. At September 30, 2017, there were 6.9 million shares still authorized to be repurchased.

~~PNC Capital Contribution~~. ~~During the three months ended March 31, 2017, PNC surrendered to BlackRock 517,138 shares of BlackRock Series C Preferred to fund certain LTIP awards.~~

~~16. Restructuring Charge~~

~~A restructuring charge of $76 million ($53 million after-tax), comprised of $44 million of severance and $32 million of~~ expense related to ~~the accelerated amortization of previously granted deferred cash and equity compensation awards, was recorded~~legislation enacted in the ~~first quarter of 2016 in connection with a project to streamline and simplify the organization. There was no restructuring liability outstanding at September 30, 2017.~~United Kingdom.

~~17.~~22. Earnings Per Share

Due to the similarities in terms between BlackRock nonvoting participating preferred stock and the Company’s common stock, the Company considers its participating preferred stock to be a common stock equivalent for purposes of earnings per share (“EPS”) calculations. As such, the Company has included the outstanding nonvoting participating preferred stock in the calculation of average basic and diluted shares outstanding.

The following table sets forth the computation of basic and diluted ~~EPS~~earnings per share (“EPS”) for the three and nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 under the treasury stock method:

	Three Months Ended				Nine Months Ended				Three Months Ended				Nine Months Ended
	September 30,				September 30,				September 30,				September 30,
(in millions, except shares and per share data)	2017		2016		2017		2016		2021		2020		2021		2020
Net income attributable to BlackRock	$	947	$	875	$	2,666	$	2,321
Net income attributable to BlackRock, Inc.									$	1,681	$	1,364	$	4,258	$	3,384
Basic weighted-average shares outstanding		161,872,716		164,129,214		162,459,737		164,756,355		152,120,927		152,488,073		152,375,504		153,816,544
Dilutive effect of nonparticipating RSUs and stock options		1,900,830		2,127,384		1,829,305		2,004,557
Dilutive effect of:
Nonparticipating RSUs										1,474,725		1,254,191		1,354,405		1,143,268
Stock options										747,625		—		622,681		—
Total diluted weighted-average shares outstanding		163,773,546		166,256,598		164,289,042		166,760,912		154,343,277		153,742,264		154,352,590		154,959,812
Basic earnings per share	$	5.85	$	5.33	$	16.41	$	14.09	$	11.05	$	8.94	$	27.94	$	22.00
Diluted earnings per share	$	5.78	$	5.26	$	16.23	$	13.92	$	10.89	$	8.87	$	27.59	$	21.84

The amount of anti-dilutive RSUs was immaterial for the three and nine months ended September 30, 2021 and 2020. Certain performance-based RSUs were excluded from the diluted EPS calculation because the designated contingency was not met for the three and nine months ended September 30, 2021 and 2020, respectively. In addition, performance-based stock options were excluded from the diluted EPS calculation for the three and nine months ended September 30, 2020 because the designated contingency was not met.

~~18.~~

23. Segment Information

The Company’s management directs BlackRock’s operations as ~~one~~1 business, the asset management business. The Company utilizes a consolidated approach to assess performance and allocate resources. As such, the Company operates in one business ~~segment as defined in ASC 280-10.~~segment.

The following table illustrates investment advisory, administration fees, securities lending revenue and performance fees by product type, technology and risk management revenue, distribution fees, and advisory and other revenue for the three and nine months ended September 30, 2017 and 2016.

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in millions)

2017

2016

2017

2016

Equity

$
1,457

$
1,284

$
4,134

$
3,746

Fixed income

749

695

2,153

1,975

Multi-asset

291

286

857

866

Alternatives

342

221

754

633

Cash management

144

118

408

340

Total investment advisory, administration fees,
securities lending revenue and performance fees

2,983

2,604

8,306

7,560

Technology and risk management revenue

175

152

497

439

Distribution fees

5

10

17

32

Advisory and other revenue

70

71

202

234

Total revenue

$
3,233

$
2,837

$
9,022

$
8,265

The following table illustrates total revenue for the three and nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 by geographic region. These amounts are aggregated on a legal entity basis and do not necessarily reflect where the customer resides or affiliated services are provided.

	Three Months Ended				Nine Months Ended				Three Months Ended				Nine Months Ended
(in millions)	September 30,				September 30,				September 30,				September 30,
Revenue	2017		2016		2017		2016		2021		2020		2021		2020
Americas	$	2,126	$	1,934	$	6,077	$	5,580	$	3,127	$	2,631	$	9,095	$	7,581
Europe		946		773		2,496		2,287		1,706		1,574		4,533		3,661
Asia-Pacific		161		130		449		398		217		164		640		485
Total revenue	$	3,233	$	2,837	$	9,022	$	8,265	$	5,050	$	4,369	$	14,268	$	11,727

See Note 16, Revenue, for further information on the Company’s sources of revenue.

The following table illustrates long-lived assets that consist of goodwill and property and equipment at September 30, ~~2017~~2021 and December 31, ~~2016~~2020 by geographic region. These amounts are aggregated on a legal entity basis and do not necessarily reflect where the asset is physically located.

(in millions)	September 30,		December 31,		September 30,		December 31,
Long-lived Assets	2017		2016		2021		2020
Americas	$	13,546	$	13,424	$	14,623	$	13,784
Europe		166		163		1,344		1,360
Asia-Pacific		85		90		96		88
Total long-lived assets	$	13,797	$	13,677	$	16,063	$	15,232

Americas is primarily is comprised of the United States, Latin America and Canada, while Europe is primarily is comprised of the ~~United Kingdom~~UK, the Netherlands, France and Luxembourg. Asia-Pacific is primarily is comprised of Hong Kong, Australia, Japan and Singapore.

~~19.~~24. Subsequent Events

In June 2017, the Company announced that it entered into an agreement for a minority investment in Scalable Capital, a digital investment manager in Europe. The transaction is expected to be completed in the fourth quarter of 2017, subject to customary regulatory approvals and closing conditions. This transaction is not expected to be material to the Company’s condensed consolidated statements of financial condition or results of operations.

The Company conducted a review for ~~additional~~ subsequent events and determined that no subsequent events had occurred that would require accrual or additional disclosures.

~~Ite~~mItem 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

FORWARD-LOOKING STATEMENTS

This report, 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 report, 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; ~~(2)~~(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”); ~~(3)~~(4) the relative and absolute investment performance of BlackRock’s investment products; ~~(4)~~(5) BlackRock’s ability to develop new products and services that address client preferences; (6) the impact of increased competition; ~~(5)~~(7) the impact of future acquisitions or divestitures; ~~(6)~~(8) BlackRock’s ability to integrate acquired businesses successfully; (9) the unfavorable resolution of legal proceedings; ~~(7)~~(10) the extent and timing of any share repurchases; ~~(8)~~(11) the impact, extent and timing of technological changes and the adequacy of intellectual property, information and cyber security protection; ~~(9)~~(12) attempts to circumvent BlackRock’s operational control environment or the potential for human error in connection with BlackRock’s operational systems; ~~(10)~~(13) the impact of legislative and regulatory actions and reforms and regulatory, supervisory or enforcement actions of government agencies relating to ~~BlackRock or The PNC Financial Services Group, Inc. (“PNC”); (11)~~BlackRock; (14) changes in law and policy and uncertainty pending any such changes; ~~(12)~~(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; ~~(13)~~(18) the ability to attract and retain highly talented professionals; ~~(14)~~(19) fluctuations in the carrying value of BlackRock’s economic investments; ~~(15)~~(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; ~~(16)~~(21) BlackRock’s success in negotiating distribution arrangements and maintaining distribution channels for its products; ~~(17)~~(22) the failure by a key vendor of BlackRock to fulfill its obligations to the Company; ~~(18)~~(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 (“ETF”) platform; ~~(19)~~(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 ~~(20)~~(26) the impact of problems at other financial institutions or the failure or negative performance of products at other financial institutions.

OVERVIEW

BlackRock, Inc. (together, with its subsidiaries, unless the context otherwise indicates, “BlackRock” or the “Company”) is a leading publicly traded investment management firm with ~~$5.977~~$9.5 trillion of AUM at September 30, ~~2017.~~2021. With approximately ~~13,700~~18,000 employees in more than 30 countries who serve clients in over 100 countries across the globe, BlackRock provides a broad range of investment management and ~~risk management~~technology services to institutional and retail clients worldwide.

BlackRock’s diverse platform of alpha-seeking active, ~~(alpha)~~index and ~~index (beta)~~cash management investment strategies across asset classes enables the Company to tailor investment outcomes and asset allocation solutions for clients. Product offerings include single- and multi-asset ~~class~~ portfolios investing in equities, fixed income, alternatives and money market instruments. Products are offered directly and through intermediaries in a variety of vehicles, including open-end and closed-end mutual funds, ~~iShares~~^®ETFs, separate accounts, collective ~~investment~~trust funds and other pooled investment vehicles. BlackRock also offers technology services, including the investment and risk management technology platform, Aladdin^®, ~~risk analytics,~~Aladdin Wealth, eFront, Cachematrix and FutureAdvisor, as well as advisory ~~and technology~~ services and solutions to a broad base of institutional and wealth management ~~investors.~~clients.

BlackRock serves a diverse mix of institutional and retail clients across the globe. Clients include tax-exempt institutions, such as defined benefit and defined contribution pension plans, charities, foundations and endowments; official institutions, such as central banks, sovereign wealth funds, supranationals and other government entities; taxable institutions, including insurance companies, financial institutions, corporations and third-party fund sponsors, and retail ~~investors.~~intermediaries.

BlackRock maintains a significant global sales and marketing presence that is focused on establishing and maintaining retail and institutional investment management and technology service relationships by marketing its services to investors directly and through third-party distribution relationships, including financial professionals and pension ~~consultants,~~consultants.

Certain prior period presentations and ~~establishing third-party distribution relationships.~~disclosures, while not required to be recast, were reclassified to ensure comparability with current period classifications.

~~At September 30, 2017, PNC held 21.4%~~COVID-19 Impact

BlackRock continues to actively monitor COVID-19 developments and their potential impact on the Company’s employees, business and operations, particularly in jurisdictions where BlackRock has significant employee populations and/or business activity.

The aggregate extent to which COVID-19, and existing and new variants of COVID-19, affect BlackRock’s business, results of operations and financial condition, will depend on future developments that are highly uncertain and cannot be predicted, including the scope and duration of the ~~Company’s voting common stock~~pandemic and ~~21.9%~~any recovery period, the emergence and spread of variants of the ~~Company’s capital stock, which includes outstanding common~~COVID-19 virus, the continuing prevalence of severe, unconstrained and/or escalating rates of infection in certain countries and ~~nonvoting preferred stock.~~

~~Certain items previously reported have been reclassified to conform to~~regions, and the ~~current period presentation. For more~~availability, adoption and efficacy of treatments and vaccines. See Part II, Item 1A - Risk Factors, of this filing for further information on the ~~current period’s reclassification, see “Discussion of Financial Results – Revenue” herein.~~

~~OTHER DEVELOPMENTS~~

~~Acquisitions~~

~~In June 2017, the Company completed the acquisition~~possible future impact of the equity infrastructure franchise of First Reserve (“First Reserve Transaction”), expanding the Company’s energy and power infrastructure platform. Total consideration for the transaction was approximately $193 million, including $120 million of contingent consideration at fair value at time of close.

In July 2017, the Company completed the acquisition of Cachematrix (“Cachematrix Transaction”), a leading provider of financial technology which simplifies the cash management process for banks and their corporate clients in a streamlined, open-architecture platform. Total consideration for the transaction was approximately $38 million.

United Kingdom Exit from European Union

~~Following~~On December 31, 2020, the ~~June 2016 vote to exit~~United Kingdom (“UK”) and the European Union (“EU”)~~, the United Kingdom served notice under Article 50 of the Treaty on European Union on March 29, 2017~~ reverted to ~~initiate the process of exiting from the EU, commonly referred to as "Brexit".~~being distinct regulatory, legal and customs territories. The ~~outcome of the negotiations between the United Kingdom~~UK and the EU concluded a free trade agreement, known as the “EU-UK Trade and Cooperation Agreement.” The agreement does not include any substantive provisions governing cross-border trade in financial services between the UK and the EU. As a result, since January 1, 2021, cross-border financial services trade between the UK and the EU has been governed by their respective financial services regulations and market access regimes. BlackRock implemented a number of steps to prepare for this outcome. These steps, which may add complexity to BlackRock’s future European operations, include effecting organizational, governance and operational changes, applying for and receiving additional licenses and permissions in the EU, and engaging in client communications. In addition, depending on how the future relationship between the UK and the EU develops, BlackRock may experience further organizational and operational challenges and incur additional costs in connection with ~~Brexit is highly uncertain~~its European operations, particularly with regard to delegation and ~~information regarding~~cross-border marketing of funds, which may impede the ~~long-term consequences is expected to become clearer over time as negotiations progress.~~Company’s growth or impact its financial performance.

Acquisition

On February 1, 2021, the Company acquired 100% of the equity interests of Aperio Group, LLC (the “Aperio Transaction” or “Aperio”), a pioneer in customizing tax-optimized index equity separately managed accounts (“SMAs”) for approximately $1.1 billion in cash, using existing cash resources. The ~~Company continues to prepare for a range~~acquisition of ~~potential outcomes in connection with Brexit.~~

~~EXECUTIVE SUMMARY~~Aperio increased BlackRock’s SMA assets under management and expanded the breadth of the Company’s capabilities via tax-managed strategies across factors, broad market indexing, and investor Environmental, Social, and Governance preferences across all asset classes.

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in millions, except shares and per share data)

2017

2016

2017

2016

GAAP basis:

Total revenue

$
3,233

$
2,837

$
9,022

$
8,265

Total expense

1,839

1,628

5,239

4,920

Operating income

1,394

1,209

3,783

3,345

Operating margin

43.1
%

42.6
%

41.9
%

40.5
%
Nonoperating income (expense), less net income (loss)
     attributable to noncontrolling interests

(2
)

(1
)

(27
)

(70
)
Income tax expense

(445
)

(333
)

(1,090
)

(954
)
Net income attributable to BlackRock

$
947

$
875

$
2,666

$
2,321

Diluted earnings per common share

$
5.78

$
5.26

$
16.23

$
13.92

Effective tax rate

32.0
%

27.6
%

29.0
%

29.1
%
As adjusted⁽¹⁾:

Operating income

$
1,398

$
1,216

$
3,795

$
3,442

Operating margin

45.0
%

44.8
%

43.9
%

43.5
%
Nonoperating income (expense), less net income (loss)
     attributable to noncontrolling interests

(2
)

(1
)

(27
)

(70
)
Net income attributable to BlackRock

$
969

$
854

$
2,694

$
2,362

Diluted earnings per common share

$
5.92

$
5.14

$
16.40

$
14.16

Effective tax rate

30.6
%

29.7
%

28.5
%

30.0
%
Other:

Assets under management (end of period)

$
5,976,892

$
5,117,421

$
5,976,892

$
5,117,421

Diluted weighted-average common shares outstanding⁽²⁾

163,773,546

166,256,598

164,289,042

166,760,912

Common and preferred shares outstanding
    (end of period)

161,597,770

163,858,070

161,597,770

163,858,070

Book value per share⁽³⁾

$
185.91

$
176.40

$
185.91

$
176.40

Cash dividends declared and paid per share

$
2.50

$
2.29

$
7.50

$
6.87

EXECUTIVE SUMMARY

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(in millions, except shares and per share data)	2021			2020			2021			2020
GAAP basis:
Total revenue	$	5,050		$	4,369		$	14,268		$	11,727
Total expense		3,115			2,612			8,857			7,880
Operating income	$	1,935		$	1,757		$	5,411		$	3,847
Operating margin		38.3	%		40.2	%		37.9	%		32.8	%
Nonoperating income (expense), less net income (loss) attributable to noncontrolling interests		264			71			337			348
Income tax expense		(518	)		(464	)		(1,490	)		(811	)
Net income attributable to BlackRock	$	1,681		$	1,364		$	4,258		$	3,384
Diluted earnings per common share	$	10.89		$	8.87		$	27.59		$	21.84
Effective tax rate		23.6	%		25.4	%		25.9	%		19.3	%
As adjusted⁽¹⁾:
Operating income	$	1,946		$	1,757		$	5,422		$	4,436
Operating margin		45.8	%		47.0	%		45.1	%		44.3	%
Nonoperating income (expense), less net income (loss) attributable to noncontrolling interests	$	264		$	71		$	337		$	226
Net income attributable to BlackRock	$	1,690		$	1,418		$	4,438		$	3,664
Diluted earnings per common share	$	10.95		$	9.22		$	28.75		$	23.64
Effective tax rate		23.6	%		22.5	%		22.9	%		21.4	%
Other:
AUM (end of period)	$	9,463,662		$	7,808,497		$	9,463,662		$	7,808,497
Diluted weighted-average common shares outstanding		154,343,277			153,742,264			154,352,590			154,959,812
Shares outstanding (end of period)		151,988,234			152,496,403			151,988,234			152,496,403
Book value per share⁽²⁾	$	242.24		$	222.12		$	242.24		$	222.12
Cash dividends declared and paid per share	$	4.13		$	3.63		$	12.39		$	10.89

⁽⁽¹⁾¹⁾

As adjusted items are described in more detail in Non-GAAP Financial Measures.

⁽²⁾	~~Nonvoting participating preferred shares are considered to be common stock equivalents for purposes of determining basic and diluted earnings per share calculations.~~

⁽³⁾	Total BlackRock stockholders’ equity divided by total ~~common and preferred~~ shares outstanding at September 30 of the respective period-end.

THREE MONTHS ENDED SEPTEMBER 30, ~~2017~~2021 COMPARED WITH THREE MONTHS ENDED SEPTEMBER 30, ~~2016~~2020

GAAP.Operating income of ~~$1,394~~$1,935 million increased ~~$185~~$178 million and operating margin of ~~43.1% increased 50~~38.3% decreased 190 bps from the third quarter of ~~2016.~~2020. Operating income and operating margin reflected market gains as well as strong organic growth ~~reflected higher year-over-year base fees,~~and technology services revenue, offset by lower performance fees and ~~technology~~higher expense, driven by higher general and ~~risk management revenue, partially offset by~~administration expense, including higher transaction-related expense and product launch costs in the current quarter, higher employee compensation and benefits expense, and higher direct fund expense. Product launch costs of $99 million in the third quarter of 2021 were primarily associated with the September 2021 close of the BlackRock ESG Capital Allocation Trust. Product launch costs of $83 million in the third quarter of 2020 were primarily associated with the BlackRock Capital Allocation Trust. Operating income and operating margin also reflected $11 million of noncash occupancy expense related to the lease of office space for the Company’s future headquarters located at 50 Hudson Yards in New York (“Lease cost – Hudson Yards”), which it expects to begin to occupy in late 2022 (and begin lease payments in May 2023).

Nonoperating income (expense) less net income (loss) attributable to noncontrolling interests (“NCI”) increased $193 million from the third quarter of 2020, primarily driven by non-cash gains related to our strategic minority investments in iCapital Network, Inc. (“iCapital”) and Scalable Capital Limited (“Scalable”) and higher ~~general~~mark-to-market gains on the Company’s private equity co-investment portfolio.

Earnings per diluted common share increased $2.02, or 23%, from the third quarter of 2020, reflecting higher operating and ~~administration expense.~~ nonoperating income, and a lower effective tax rate in the current quarter.

~~Third~~As Adjusted. Operating income of $1,946 million increased $189 million and operating margin of 45.8% decreased 120 bps from the third quarter ~~2017 income~~of 2020. Earnings perdiluted common share increased $1.73, or 19%, from the third quarter of 2020. The impact of the Lease cost – Hudson Yards described above has been excluded from as adjusted results for the third quarter of 2021. Income tax expense, ~~included~~as adjusted, for the third quarter of 2020 excluded a $54 million noncash net ~~noncash~~ expense ~~of $19 million~~ related to the revaluation of certain deferred ~~income~~ tax ~~liabilities as a result of domestic state~~assets and ~~local changes. Third quarter 2016 income tax expense included a $26 million net noncash tax benefit, primarily related to the revaluation of certain deferred income tax~~ liabilities as a result of legislation enacted in the ~~United Kingdom, and domestic state and local income~~UK increasing its corporate tax ~~changes. Third quarter 2016 income tax expense also included nonrecurring tax benefits of $16 million primarily due to the resolution of certain outstanding tax matters. See~~ ~~Income Tax Expense~~ ~~within~~ ~~Discussion of Financial Results~~ ~~for more information.~~

Earnings per diluted common share increased $0.52, or 10%, from the third quarter of 2016, driven primarily by higher operating income and the benefit of share repurchases, partially offset by higher income tax expense.

~~As Adjusted~~rate. Operating income of $1,398 million increased $182 million from the third quarter of 2016, and operating margin of 45.0% increased 20 bps from the third quarter of 2016. Income tax expense for the third quarter of 2017 and 2016 excluded the $19 million net noncash expense and $26 million net noncash benefit, respectively, described above. Earnings per diluted common share increased $0.78, or 15%, from the third quarter of 2016.

NINE MONTHS ENDED SEPTEMBER 30, ~~2017~~2021 COMPARED WITH NINE MONTHS ENDED SEPTEMBER 30, ~~2016~~2020

GAAP.Operating income of ~~$3,783~~$5,411 million increased ~~$438~~$1,564 million and operating margin of ~~41.9%~~37.9% increased ~~140~~510 bps from the nine months ended September 30, ~~2016. Operating~~2020. Increases in operating income and operating margin ~~growth primarily~~ reflected higher year-over-year base fees, performance fees, and technology and risk management revenue, partially offset by higher compensation and benefits, higher direct fund expense, and higher general and administration expense. The nine months ended September 30, 2017 also included approximately $22the impact of $589 million related to the previously reported charitable contribution of ~~expense associated with the strategic repositioning of the active equity platform. Operating income for~~BlackRock’s remaining 20% stake in PennyMac Financial Services, Inc. (the “Charitable Contribution”) during the nine months ended September 30, ~~2016 included a restructuring charge of $76 million~~2020. Operating income and operating margin also reflected higher investment advisory and administration fees (collectively “base fees”), performance fees and technology services revenue, partially offset by higher employee compensation and benefits expense, higher volume-related expense and higher product launch costs in ~~connection with a project to streamline and simplify the organization.~~ 2021.

Nonoperating income (expense), less net income (loss) attributable to ~~noncontrolling interest (“NCI”), increased $43~~NCI decreased $11 million ~~driven by higher net gains on investments. Nonoperating results for~~from the nine months ended September 30, ~~2017 included~~2020, reflecting the impact of a ~~“make-whole” redemption premium~~pre-tax gain of ~~$14~~approximately $240 million in connection with a recapitalization of iCapital and $122 million pre-tax gain related to the ~~refinancing~~Charitable Contribution during the nine months ended September 30, 2020, partially offset by the impact of ~~$700 million of 6.25% notes, which were paid prior~~non-cash gains related to ~~their~~iCapital and Scalable and higher mark-to-market gains on the Company’s private equity co-investment portfolio during the nine months ended September ~~2017 maturity.~~ 30, 2021.

Income tax expense for the nine months ended September 30, ~~2017~~2021 reflected the $171 million noncash net expense related to the revaluation of certain deferred tax assets and liabilities as a result of legislation enacted in the UK increasing its corporate tax rate. Income tax expense for the nine months ended September 30, 2020 included ~~an $81 million~~a discrete tax benefit ~~reflecting~~of $241 million recognized in connection with the ~~adoption~~Charitable Contribution and a $54 million noncash net expense related to the revaluation of ~~new accounting guidance~~certain deferred tax assets and liabilities described above. Income tax expense for the nine months ended September 30, 2021 and 2020 also reflected $42 million and $78 million, respectively, of discrete tax benefits, including benefits related to stock-based compensation awards that vested in the first quarter of ~~2017~~each year. See Income Tax Expense within Discussion of Financial Results for more information.

Earnings per diluted common share increased $5.75, or 26%, from the nine months ended September 30, 2020, reflecting the impact of the Charitable Contribution incurred in the nine months ended September 30, 2020. The increase in earnings per diluted common share also included higher revenue, partially offset by higher product launch costs, lower nonoperating income, and a higher effective tax rate in the ~~$19~~nine months ended September 30, 2021.

As Adjusted. Operating income of $5,422 million ~~net noncash expense mentioned above.~~ increased $986 million and operating margin of 45.1% increased 80 bps from the nine months ended September 30, 2020. Earnings per diluted common share increased $5.11, or 22%, from the nine months ended September 30, 2020,primarily due to higher operating and nonoperating income, partially offset by a higher effective tax rate in the nine months ended September 30, 2021.Income tax expense for the nine months ended September 30, ~~2016 included~~2021 and 2020 excluded the ~~$26~~$171 million and $54 million, respectively, of noncash net ~~noncash benefit mentioned above and nonrecurring tax benefits of $35 million. See~~ ~~Income Tax Expense~~ ~~within~~ ~~Discussion of Financial Results~~ ~~for more information.~~

~~Earnings per diluted common share increased $2.31, or 17%, from~~expense described above. The financial impact related to the ~~nine months ended September 30, 2016, driven primarily by higher net income,~~Lease cost – Hudson Yards and the ~~benefit of share repurchases.~~

~~As Adjusted~~. Operating income of $3,795 million increased $353 million and operating margin of 43.9% increased 40 bps from the nine months ended September 30, 2016. The pre-tax restructuring charge of $76 million described above wasCharitable Contribution has been excluded from as adjusted results for the nine months ended September 30, ~~2016. Income tax expense for the nine months ended September 30, 2017~~2021 and 2016 excluded the previously described net noncash expense of $19 million and net noncash benefit of $26 million, respectively, and included the nonrecurring tax benefits described above. Earnings per diluted common share increased $2.24, or 16%, from the nine months ended September 30, 2016.2020, respectively.

See Non-GAAP Financial Measures for further information on as adjusted items and the reconciliation to accounting principles generally accepted in the United States (“~~GAAP“~~GAAP”).

For further discussion of BlackRock’s revenue, expense, nonoperating results and income tax expense, see Discussion of Financial Results herein.

NON-GAAP FINANCIAL MEASURES

BlackRock reports its financial results in accordance with 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.

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:~~adjusted:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(in millions)	2021			2020			2021			2020
Operating income, GAAP basis	$	1,935		$	1,757		$	5,411		$	3,847
Non-GAAP expense adjustment:
Lease costs - Hudson Yards		11			—			11			—
Charitable Contribution		—			—			—			589
Operating income, as adjusted		1,946			1,757			5,422			4,436
Product launch costs and commissions		99			83			284			170
Operating income used for operating margin measurement	$	2,045		$	1,840		$	5,706		$	4,606
Revenue, GAAP basis	$	5,050		$	4,369		$	14,268		$	11,727
Non-GAAP adjustments:
Distribution fees		(401	)		(288	)		(1,110	)		(817	)
Investment advisory fees		(184	)		(168	)		(503	)		(513	)
Revenue used for operating margin measurement	$	4,465		$	3,913		$	12,655		$	10,397
Operating margin, GAAP basis		38.3	%		40.2	%		37.9	%		32.8	%
Operating margin, as adjusted		45.8	%		47.0	%		45.1	%		44.3	%

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 non-GAAP expense adjustments. During the three and nine months ended September 30, 2021, the Company recorded expense of $11 million related to the Lease cost – Hudson Yards. While the Company expects to begin to occupy the new office space in late 2022 (and begin cash lease payments in May 2023), the Company is required to record lease expense from August 2021 because it obtained access to the building to begin its tenant improvements. As a result, the Company is recognizing lease expense for both its current and future headquarters until its current headquarters lease expires in April 2023. Management believes removing the Lease cost – Hudson Yards when calculating operating income, as adjusted, is useful to assess its financial performance and enhances comparability among periods presented. During the nine months ended September 30, 2020, 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:

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in millions)

2017

2016

2017

2016

Operating income, GAAP basis

$
1,394

$
1,209

$
3,783

$
3,345

Non-GAAP expense adjustments:

Restructuring charge

—

—

—

76

PNC LTIP funding obligation

4

7

12

21

Operating income, as adjusted

$
1,398

$
1,216

$
3,795

$
3,442

Revenue, GAAP basis

$
3,233

$
2,837

$
9,022

$
8,265

Non-GAAP adjustments:

Distribution and servicing costs

(123
)

(114
)

(361
)

(320
)
Amortization of deferred sales commissions

(4
)

(8
)

(13
)

(27
)
Revenue used for operating margin measurement

$
3,106

$
2,715

$
8,648

$
7,918

Operating margin, GAAP basis

43.1
%

42.6
%

41.9
%

40.5
%
Operating margin, as adjusted

45.0
%

44.8
%

43.9
%

43.5
%

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in millions)	2021		2020		2021		2020
Nonoperating income (expense), GAAP basis	$	336	$	224	$	652	$	510
Less: Net income (loss) attributable to NCI		72		153		315		162
Nonoperating income (expense), net of NCI		264		71		337		348
Less: Gain related to the Charitable Contribution		—		—		—		122
Nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted	$	264	$	71	$	337	$	226

~~Operating~~Management believes nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, ~~includes non-GAAP expense adjustments. The portion~~is an effective measure for reviewing BlackRock’s nonoperating contribution to its results and provides comparability of ~~compensation expense associated with certain long-term incentive plans (“LTIP”) funded, or~~this information among reporting periods. Management believes nonoperating income (expense), less net income (loss) attributable to ~~be funded, through share distributions to participants~~NCI, as adjusted, provides a useful measure, for both management and investors, of ~~BlackRock stock held by PNC has been excluded because it~~BlackRock’s nonoperating results, which ultimately ~~does not~~ impact BlackRock’s book value. ~~For~~During the nine months ended September 30, ~~2016, a restructuring charge comprised~~2020, the noncash, nonoperating pre-tax gain of ~~severance and accelerated amortization expense of previously granted deferred compensation awards~~$122 million related to the Charitable Contribution has been excluded from nonoperating income (expense), less net income (loss) attributable to ~~provide an analysis of BlackRock’s ongoing operations and~~NCI, as adjusted, due to ~~ensure comparability among periods presented.~~its nonrecurring nature.

•

Revenue used for operating margin, as adjusted, excludes distribution and servicing costs paid to related parties and other third parties. Management believes such costs represent a benchmark for the amount of revenue passed through to external parties who distribute the Company’s products. In addition, management believes the exclusion of such costs is useful because it creates consistency in the treatment for certain contracts for similar services, which due to the terms of the contracts, are accounted for under GAAP on a net basis within investment advisory, administration fees and securities lending revenue. Amortization of deferred sales commissions is excluded from revenue used for operating margin measurement, as adjusted, because such costs, over time, substantially offset distribution fee revenue the

~~Company earns. For each of these items, BlackRock excludes from revenue used for operating margin, as adjusted, the costs related to each of these items as a proxy for such offsetting revenue.~~

~~(2)~~(3) Net income attributable to BlackRock, Inc., as ~~adjusted:~~adjusted:

	Three Months Ended					Nine Months Ended					Three Months Ended				Nine Months Ended
	September 30,					September 30,					September 30,				September 30,
(in millions, except per share data)	2017		2016			2017		2016			2021		2020		2021		2020
Net income attributable to BlackRock, Inc., GAAP basis	$	947	$	875		$	2,666	$	2,321		$	1,681	$	1,364	$	4,258	$	3,384
Non-GAAP adjustments:
Restructuring charge (including $23 tax benefit)		—		—			—		53
PNC LTIP funding obligation, net of tax		3		5			9		14
Lease costs - Hudson Yards, net of tax												9		—		9		—
Charitable Contribution, net of tax												—		—		—		226
Income tax matters		19		(26	)		19		(26	)		—		54		171		54
Net income attributable to BlackRock, Inc., as adjusted	$	969	$	854		$	2,694	$	2,362		$	1,690	$	1,418	$	4,438	$	3,664
Diluted weighted-average common shares outstanding⁽³⁾		163.8		166.3			164.3		166.8			154.3		153.7		154.4		155.0
Diluted earnings per common share, GAAP basis⁽³⁾	$	5.78	$	5.26		$	16.23	$	13.92		$	10.89	$	8.87	$	27.59	$	21.84
Diluted earnings per common share, as adjusted⁽³⁾	$	5.92	$	5.14		$	16.40	$	14.16		$	10.95	$	9.22	$	28.75	$	23.64

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, ~~and~~ operating margin, as adjusted, and nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, for information on the ~~PNC LTIP funding obligation~~Lease cost – Hudson Yards and Charitable Contribution.

The nine months ended September 30, 2020 included a discrete tax benefit of $241 million that was recognized in connection with the ~~restructuring charge.~~

~~For each period presented, the non-GAAP adjustment related~~Charitable Contribution. The discrete tax benefit has been excluded from as adjusted results due to the ~~restructuring charge and PNC LTIP funding obligation was tax effected at~~nonrecurring nature of the ~~respective blended rates applicable to the adjustments.~~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. Amounts~~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~~weighted-average common shares outstanding.

~~(3) Nonvoting participating preferred stock is considered to be a common stock equivalent for purposes of determining basic and diluted earnings per share calculations.~~

ASSETS UNDER MANAGEMENT

AUM for reporting purposes generally is based upon how ~~investment advisory and administration~~base fees are calculated for each portfolio. Net asset values, total assets, committed assets or other measures may be used to determine portfolio AUM.

AUM and Net Inflows (Outflows) by Client Type
AUM and Net Inflows (Outflows) by Client Type and Product Type																			AUM and Net Inflows (Outflows) by Client Type and Product Type
																			AUM								Net inflows (outflows)
																											Three Months			Nine Months			Twelve Months
		AUM								Net inflows (outflows)																	Ended			Ended			Ended
		September 30,		June 30,		December 31,		September 30,		Three Months Ended September 30,			Nine Months Ended September 30,			Twelve Months Ended September 30,			September 30,		June 30,		December 31,		September 30,		September 30,			September 30,			September 30,
(in millions)		2017		2017		2016		2016		2017			2017			2017			2021		2021		2020		2020		2021			2021			2021
Retail		$	608,521	$	586,756	$	541,952	$	554,778	$	7,367		$	18,501		$	16,055		$	1,000,627	$	995,483	$	845,917	$	746,264	$	22,672		$	80,572		$	115,889
iShares ETFs			1,640,437		1,528,236		1,287,879		1,246,166		52,306			190,541			239,841
ETFs																				3,038,751		3,031,505		2,669,007		2,321,335		57,954			201,591			280,344
Institutional:
Active			1,105,224		1,075,855		1,009,974		1,039,653		155			3,735			10,043			1,638,545		1,624,049		1,524,462		1,427,122		25,558			85,558			86,913
Index			2,194,701		2,093,193		1,901,681		1,877,501		15,976			36,883			71,486			3,063,692		3,097,073		2,948,683		2,641,408		(8,212	)		(77,405	)		(76,633	)
Total institutional			3,299,925		3,169,048		2,911,655		2,917,154		16,131			40,618			81,529
Institutional subtotal																				4,702,237		4,721,122		4,473,145		4,068,530		17,346			8,153			10,280
Long-term																				8,741,615		8,748,110		7,988,069		7,136,129		97,972			290,316			406,513
Cash management																				712,015		727,603		666,252		652,002		(12,398	)		50,132			59,076
Advisory⁽¹⁾																				10,032		20,280		22,359		20,366		(10,260	)		(12,530	)		(10,738	)
Total																			$	9,463,662	$	9,495,993	$	8,676,680	$	7,808,497	$	75,314		$	327,918		$	454,851

AUM and Net Inflows (Outflows) by Investment Style and Product Type																			AUM and Net Inflows (Outflows) by Investment Style and Product Type
																			AUM								Net inflows (outflows)
																											Three Months			Nine Months			Twelve Months
																											Ended			Ended			Ended
																			September 30,		June 30,		December 31,		September 30,		September 30,			September 30,			September 30,
(in millions)																			2021		2021		2020		2020		2021			2021			2021
Active																			$	2,463,867	$	2,446,632	$	2,250,887	$	2,072,673	$	44,528		$	166,233		$	197,293
Index and ETFs																				6,277,748		6,301,478		5,737,182		5,063,456		53,444			124,083			209,220
Long-term			5,548,883		5,284,040		4,741,486		4,718,098		75,804			249,660			337,425			8,741,615		8,748,110		7,988,069		7,136,129		97,972			290,316			406,513
Cash management			425,423		402,575		403,584		388,982		20,381			14,854			32,526			712,015		727,603		666,252		652,002		(12,398	)		50,132			59,076
Advisory⁽¹⁾			2,586		2,658		2,782		10,341		(73	)		(188	)		(7,573	)		10,032		20,280		22,359		20,366		(10,260	)		(12,530	)		(10,738	)
Total		$	5,976,892	$	5,689,273	$	5,147,852	$	5,117,421	$	96,112		$	264,326		$	362,378		$	9,463,662	$	9,495,993	$	8,676,680	$	7,808,497	$	75,314		$	327,918		$	454,851

AUM and Net Inflows (Outflows) by Product Type	AUM and Net Inflows (Outflows) by Product Type																		AUM and Net Inflows (Outflows) by Product Type
		AUM								Net inflows (outflows)									AUM								Net inflows (outflows)
		September 30,		June 30,		December 31,		September 30,		Three Months Ended September 30,			Nine Months Ended September 30,			Twelve Months Ended September 30,											Three Months			Nine Months			Twelve Months
																											Ended			Ended			Ended
																			September 30,		June 30,		December 31,		September 30,		September 30,			September 30,			September 30,
(in millions)		2017		2017		2016		2016		2017			2017			2017			2021		2021		2020		2020		2021			2021			2021
Equity		$	3,172,465	$	3,014,696	$	2,657,176	$	2,566,039	$	11,935		$	94,362		$	152,328		$	4,998,410	$	5,034,391	$	4,419,806	$	3,784,118	$	33,168		$	56,576		$	104,653
Fixed income			1,788,420		1,704,624		1,572,365		1,628,268		59,549			135,837			161,144			2,713,899		2,712,165		2,674,488		2,531,465		27,315			129,445			192,149
Multi-asset			457,027		436,736		395,007		402,261		4,334			15,406			20,262			773,158		748,770		658,733		598,246		30,935			80,824			80,422
Alternatives:
Core			99,168		97,551		88,630		88,731		(504	)		2,353			3,569
Illiquid alternatives																				98,321		95,961		85,770		79,723		2,743			12,315			16,844
Liquid alternatives																				85,052		81,560		73,218		69,255		3,782			9,455			10,492
Currency and commodities⁽²⁾			31,803		30,433		28,308		32,799		490			1,702			122			72,775		75,263		76,054		73,322		29			1,701			1,953
Subtotal			130,971		127,984		116,938		121,530		(14	)		4,055			3,691
Alternatives subtotal																				256,148		252,784		235,042		222,300		6,554			23,471			29,289
Long-term			5,548,883		5,284,040		4,741,486		4,718,098		75,804			249,660			337,425			8,741,615		8,748,110		7,988,069		7,136,129		97,972			290,316			406,513
Cash management			425,423		402,575		403,584		388,982		20,381			14,854			32,526			712,015		727,603		666,252		652,002		(12,398	)		50,132			59,076
Advisory⁽¹⁾			2,586		2,658		2,782		10,341		(73	)		(188	)		(7,573	)
Advisory																				10,032		20,280		22,359		20,366		(10,260	)		(12,530	)		(10,738	)
Total		$	5,976,892	$	5,689,273	$	5,147,852	$	5,117,421	$	96,112		$	264,326		$	362,378		$	9,463,662	$	9,495,993	$	8,676,680	$	7,808,497	$	75,314		$	327,918		$	454,851

AUM and Net Inflows (Outflows) by Investment Style
		AUM								Net inflows (outflows)
		September 30,		June 30,		December 31,		September 30,		Three Months Ended September 30,			Nine Months Ended September 30,			Twelve Months Ended September 30,
(in millions)		2017		2017		2016		2016		2017			2017			2017
Active		$	1,645,352	$	1,598,591	$	1,501,052	$	1,547,473	$	5,796		$	11,489		$	10,946
Index and iShares ETFs			3,903,531		3,685,449		3,240,434		3,170,625		70,008			238,171			326,479
Long-term			5,548,883		5,284,040		4,741,486		4,718,098		75,804			249,660			337,425
Cash management			425,423		402,575		403,584		388,982		20,381			14,854			32,526
Advisory⁽¹⁾			2,586		2,658		2,782		10,341		(73	)		(188	)		(7,573	)
Total		$	5,976,892	$	5,689,273	$	5,147,852	$	5,117,421	$	96,112		$	264,326		$	362,378

⁽¹⁾	Advisory AUM represents mandates linked to purchases and disposition of assets and portfolios on behalf of official institutions and long-term portfolio liquidation assignments.

⁽²⁾	Amounts include commodity ~~iShares~~ ETFs.

Component Changes in AUM for the Three Months Ended September 30, ~~2017~~2021

The following table presents the component changes in AUM by client type and product type for the three months ended September 30, ~~2017.~~2021.

																	Net
	June 30,		Net inflows			Market			FX		September 30,		Average		June 30,		inflows			Market			FX			September 30,		Average
(in millions)	2017		(outflows)			change			impact⁽¹⁾		2017		AUM⁽²⁾		2021		(outflows)			change			impact⁽¹⁾			2021		AUM⁽²⁾
Retail:
Equity	$	215,808	$	1,734		$	6,110		$	2,016	$	225,668	$	220,944	$	446,327	$	9,952		$	(7,823	)	$	(2,719	)	$	445,737	$	452,433
Fixed income		240,932		4,613			1,569			1,234		248,348		245,193		359,480		4,524			(3,156	)		(1,687	)		359,161		361,730
Multi-asset		113,903		1,046			2,796			317		118,062		116,183		147,228		5,395			(1,332	)		(338	)		150,953		150,409
Alternatives		16,113		(26	)		224			132		16,443		17,198		42,448		2,801			(318	)		(155	)		44,776		43,690
Retail subtotal		586,756		7,367			10,699			3,699		608,521		599,518		995,483		22,672			(12,629	)		(4,899	)		1,000,627		1,008,262
iShares ETFs:
ETFs:
Equity		1,139,850		33,102			50,806			4,637		1,228,395		1,184,488		2,257,828		34,987			(36,247	)		(5,719	)		2,250,849		2,279,480
Fixed income		364,991		17,526			1,055			2,695		386,267		376,880		700,009		22,489			(3,494	)		(2,408	)		716,596		711,729
Multi-asset		3,240		169			77			5		3,491		3,359		7,663		593			(70	)		(36	)		8,150		7,954
Alternatives		20,155		1,509			576			44		22,284		21,283		66,005		(115	)		(2,688	)		(46	)		63,156		65,863
iShares ETFs subtotal		1,528,236		52,306			52,514			7,381		1,640,437		1,586,010
ETFs subtotal																3,031,505		57,954			(42,499	)		(8,209	)		3,038,751		3,065,026
Institutional:
Active:
Equity		126,446		(3,296	)		5,866			1,350		130,366		128,842		184,174		1,930			(2,410	)		(1,462	)		182,232		185,208
Fixed income		553,652		496			4,513			3,366		562,027		559,121		716,671		(5,716	)		806			(3,063	)		708,698		718,139
Multi-asset		311,921		3,477			7,827			4,508		327,733		320,619		584,582		25,477			920			(5,682	)		605,297		604,848
Alternatives		83,836		(522	)		1,161			623		85,098		83,851		138,622		3,867			560			(731	)		142,318		140,894
Active subtotal		1,075,855		155			19,367			9,847		1,105,224		1,092,433		1,624,049		25,558			(124	)		(10,938	)		1,638,545		1,649,089
Index:
Equity		1,532,592		(19,605	)		65,291			9,758		1,588,036		1,562,897		2,146,062		(13,701	)		(114	)		(12,655	)		2,119,592		2,158,274
Fixed income		545,049		36,914			(1,451	)		11,266		591,778		572,049		936,005		6,018			139			(12,718	)		929,444		947,359
Multi-asset		7,672		(358	)		389			38		7,741		7,824		9,297		(530	)		19			(28	)		8,758		9,095
Alternatives		7,880		(975	)		156			85		7,146		7,544		5,709		1			222			(34	)		5,898		5,796
Index subtotal		2,093,193		15,976			64,385			21,147		2,194,701		2,150,314		3,097,073		(8,212	)		266			(25,435	)		3,063,692		3,120,524
Institutional subtotal		3,169,048		16,131			83,752			30,994		3,299,925		3,242,747		4,721,122		17,346			142			(36,373	)		4,702,237		4,769,613
Long-term		5,284,040		75,804			146,965			42,074		5,548,883		5,428,275		8,748,110		97,972			(54,986	)		(49,481	)		8,741,615		8,842,901
Cash management		402,575		20,381			224			2,243		425,423		415,082		727,603		(12,398	)		(784	)		(2,406	)		712,015		722,103
Advisory⁽³⁾		2,658		(73	)		(98	)		99		2,586		2,621		20,280		(10,260	)		23			(11	)		10,032		13,749
Total	$	5,689,273	$	96,112		$	147,091		$	44,416	$	5,976,892	$	5,845,978	$	9,495,993	$	75,314		$	(55,747	)	$	(51,898	)	$	9,463,662	$	9,578,753

⁽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.

⁽¹⁾ ~~Foreign exchange reflects the impact of translating non-U.S. dollar denominated AUM into U.S. 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 long-term portfolio liquidation assignments.~~

The following table presents the component changes in AUM by investment style and product type for the three months ended September 30, ~~2017.~~2021.

																	Net
	June 30,		Net inflows			Market			FX		September 30,		Average		June 30,		inflows			Market			FX			September 30,		Average
(in millions)	2017		(outflows)			change			impact⁽¹⁾		2017		AUM⁽²⁾		2021		(outflows)			change			impact⁽¹⁾			2021		AUM⁽²⁾
Active:
Equity	$	290,196	$	(3,015	)	$	10,433		$	2,562	$	300,176	$	295,895	$	479,240	$	9,651		$	(10,660	)	$	(2,999	)	$	475,232	$	483,441
Fixed income		782,622		4,836			6,079			4,303		797,840		792,042		1,054,517		(2,662	)		(2,217	)		(4,341	)		1,045,297		1,057,426
Multi-asset		425,824		4,523			10,623			4,825		445,795		436,802		731,806		30,870			(411	)		(6,020	)		756,245		755,251
Alternatives		99,949		(548	)		1,385			755		101,541		101,049		181,069		6,669			241			(886	)		187,093		184,583
Active subtotal		1,598,591		5,796			28,520			12,445		1,645,352		1,625,788		2,446,632		44,528			(13,047	)		(14,246	)		2,463,867		2,480,701
Index and iShares ETFs:
iShares ETFs:
Index and ETFs:
ETFs:
Equity		1,139,850		33,102			50,806			4,637		1,228,395		1,184,488		2,257,828		34,987			(36,247	)		(5,719	)		2,250,849		2,279,480
Fixed income		364,991		17,526			1,055			2,695		386,267		376,880		700,009		22,489			(3,494	)		(2,408	)		716,596		711,729
Multi-asset		3,240		169			77			5		3,491		3,359		7,663		593			(70	)		(36	)		8,150		7,954
Alternatives		20,155		1,509			576			44		22,284		21,283		66,005		(115	)		(2,688	)		(46	)		63,156		65,863
iShares ETFs subtotal		1,528,236		52,306			52,514			7,381		1,640,437		1,586,010
ETFs subtotal																3,031,505		57,954			(42,499	)		(8,209	)		3,038,751		3,065,026
Non-ETF Index:
Equity		1,584,650		(18,152	)		66,834			10,562		1,643,894		1,616,788		2,297,323		(11,470	)		313			(13,837	)		2,272,329		2,312,474
Fixed income		557,011		37,187			(1,448	)		11,563		604,313		584,321		957,639		7,488			6			(13,127	)		952,006		969,802
Multi-asset		7,672		(358	)		389			38		7,741		7,824		9,301		(528	)		18			(28	)		8,763		9,101
Alternatives		7,880		(975	)		156			85		7,146		7,544		5,710		-			223			(34	)		5,899		5,797
Non-ETF Index subtotal		2,157,213		17,702			65,931			22,248		2,263,094		2,216,477		3,269,973		(4,510	)		560			(27,026	)		3,238,997		3,297,174
Index & iShares ETFs subtotal		3,685,449		70,008			118,445			29,629		3,903,531		3,802,487
Index & ETFs subtotal																6,301,478		53,444			(41,939	)		(35,235	)		6,277,748		6,362,200
Long-term		5,284,040		75,804			146,965			42,074		5,548,883		5,428,275		8,748,110		97,972			(54,986	)		(49,481	)		8,741,615		8,842,901
Cash management		402,575		20,381			224			2,243		425,423		415,082		727,603		(12,398	)		(784	)		(2,406	)		712,015		722,103
Advisory⁽³⁾		2,658		(73	)		(98	)		99		2,586		2,621		20,280		(10,260	)		23			(11	)		10,032		13,749
Total	$	5,689,273	$	96,112		$	147,091		$	44,416	$	5,976,892	$	5,845,978	$	9,495,993	$	75,314		$	(55,747	)	$	(51,898	)	$	9,463,662	$	9,578,753

The following table presents the component changes in AUM by product type for the three months ended September 30, ~~2017.~~2021.

																	Net
	June 30,		Net inflows			Market			FX		September 30,		Average		June 30,		inflows			Market			FX			September 30,		Average
(in millions)	2017		(outflows)			change			impact⁽¹⁾		2017		AUM⁽²⁾		2021		(outflows)			change			impact⁽¹⁾			2021		AUM⁽²⁾
Equity	$	3,014,696	$	11,935		$	128,073		$	17,761	$	3,172,465	$	3,097,171	$	5,034,391	$	33,168		$	(46,594	)	$	(22,555	)	$	4,998,410	$	5,075,395
Fixed income		1,704,624		59,549			5,686			18,561		1,788,420		1,753,243		2,712,165		27,315			(5,705	)		(19,876	)		2,713,899		2,738,957
Multi-asset		436,736		4,334			11,089			4,868		457,027		447,985		748,770		30,935			(463	)		(6,084	)		773,158		772,306
Alternatives:
Core		97,551		(504	)		1,355			766		99,168		98,746
Illiquid alternatives																95,961		2,743			195			(578	)		98,321		97,516
Liquid alternatives																81,560		3,782			9			(299	)		85,052		83,431
Currency and commodities⁽⁴⁾		30,433		490			762			118		31,803		31,130		75,263		29			(2,428	)		(89	)		72,775		75,296
Alternatives subtotal		127,984		(14	)		2,117			884		130,971		129,876		252,784		6,554			(2,224	)		(966	)		256,148		256,243
Long-term		5,284,040		75,804			146,965			42,074		5,548,883		5,428,275		8,748,110		97,972			(54,986	)		(49,481	)		8,741,615		8,842,901
Cash management		402,575		20,381			224			2,243		425,423		415,082		727,603		(12,398	)		(784	)		(2,406	)		712,015		722,103
Advisory⁽³⁾		2,658		(73	)		(98	)		99		2,586		2,621		20,280		(10,260	)		23			(11	)		10,032		13,749
Total	$	5,689,273	$	96,112		$	147,091		$	44,416	$	5,976,892	$	5,845,978	$	9,495,993	$	75,314		$	(55,747	)	$	(51,898	)	$	9,463,662	$	9,578,753

⁽¹⁾ ~~Foreign exchange reflects the impact of translating non-U.S. dollar denominated AUM into U.S. dollars for reporting purposes.~~

⁽²⁾⁽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.

⁽⁴⁾	Amounts include commodity ~~iShares~~ ETFs.

AUM ~~increased $287.6 billion, or 5%, to $6.0~~remained flat at $9.5 trillion at September 30, ~~2017 from $5.7 trillion at June 30, 2017,~~ ~~driven~~2021, as positive net inflows were more than offset by net market ~~appreciation, positive net inflows~~depreciation and the impact of foreign exchange movements.

~~Net market appreciation of $147.1 billion was driven by higher U.S. and global equity markets.~~

Long-term net inflows of ~~$75.8~~$98 billion ~~included $52.3~~were comprised of net inflows of $58 billion, ~~$16.1~~$23 billion and ~~$7.4~~$17 billion ~~from~~ ~~iShares~~ into ETFs,, ~~institutional clients~~ retail and ~~retail clients,~~institutional, respectively. Net flows in long-term products are described below.

•

~~iShares~~ETFs net inflows of ~~$52.3~~$58 billion reflected ~~strength~~continued growth in ~~iShares~~ ~~Core,~~core equity, fixed income and sustainable ETFs, as well as inflows into precision ~~exposure and financial instrument ETFs.~~ exposures. Equity net inflows of ~~$33.1~~$35 billion were driven by both ~~U.S.~~US and international

equity market exposures. Fixed income net inflows of ~~$17.5~~$22 billion reflected demand for inflation-protection and municipal bond ETFs. By region, ETFs inflows ~~into treasury, investment grade corporate~~were diversified with $34 billion of net inflows in US-listed ETFs and ~~broad~~$19 billion of net inflows in European-listed ETFs.

•

Retail net inflows of $23 billion were positive in both the US and internationally, and across all major asset classes. Equity net inflows of $10 billion reflected strength in global and thematic equity funds, and fixed income net inflows of $5 billion were driven by unconstrained, high yield and municipal fixed income funds. ~~Commodities~~ ~~iShares~~ ~~generated $1.5~~Retail multi-asset net inflows of $5 billion included $2 billion from the successful launch of ~~net inflows.~~our first ESG-oriented closed-end fund in September, the BlackRock ESG Capital Allocation Trust.

Institutional index net inflows of $16 billion included fixed income net inflows of $36.9 billion, driven by demand for liability-driven solutions, partially offset by equity net outflows of $19.6 billion.

•

Institutional active net inflows of $26 billion were led by $26 billion of multi-asset net inflows and included the impact of a significant Outsourced Chief Investment Officer (“OCIO”) mandate from an Asia-Pacific client. Net inflows also reflected continued growth in LifePath^® target-date funds.

Retail net inflows of $7.4 billion reflected net inflows of $3.7 billion in the United States and $3.7 billion internationally. Fixed income net inflows of $4.6 billion were diversified across the Company’s top-performing active platform, led by net inflows into unconstrained, municipal and emerging market debt strategies. Equity net inflows of $1.7 billion reflected inflows into index mutual funds. Multi-asset net inflows of $1 billion were largely due to inflows into the Multi-asset Income fund family, partially offset by outflows from world allocation strategies.

•

Institutional index net outflows of $8 billion reflected equity net outflows, which were partially offset by fixed income net inflows, as clients continued to re-balance portfolios after significant equity market gains or sought to immunize portfolios though LDI strategies.

Cash management AUM ~~increased 6%~~decreased to ~~$425.4~~$712 billion, driven by ~~$20.4~~net outflows of $12 billion.

Net market depreciation of $56 billion ~~of net inflows.~~was primarily driven by global equity market depreciation.

AUM ~~increased $44.4~~decreased $52 billion due to the negative impact of foreign exchange movements, primarily ~~resulting from~~due to the ~~weakening~~strengthening of the ~~U.S.~~US dollar, largely against the British pound and the Euro.

Component Changes in AUM for the Nine Months Ended September 30, ~~2017~~2021

The following table presents the component changes in AUM by client type and product type for the nine months ended September 30, ~~2017.~~2021.

December 31,

Net
inflows

Market

FX

September 30,

Average

(in millions)

2016

(outflows)

Acquisition⁽¹⁾

change

impact⁽²⁾

2017

AUM⁽³⁾

Retail:

Equity

$
196,221

$
3,009

$
-

$
20,892

$
5,546

$
225,668

$
212,224

Fixed income

222,256

16,497

-

6,003

3,592

248,348

236,065

Multi-asset

107,997

(847
)

-

10,005

907

118,062

112,831

Alternatives

15,478

(158
)

-

725

398

16,443

16,522

Retail subtotal

541,952

18,501

-

37,625

10,443

608,521

577,642

iShares ETFs:

Equity

951,252

129,488

-

134,562

13,093

1,228,395

1,095,500

Fixed income

314,707

58,779

-

5,105

7,676

386,267

351,985

Multi-asset

3,149

61

-

272

9

3,491

3,122

Alternatives

18,771

2,213

-

1,138

162

22,284

20,470

iShares ETFs subtotal

1,287,879

190,541

-

141,077

20,940

1,640,437

1,471,077

Institutional:

Active:

Equity

120,699

(12,357
)

-

18,023

4,001

130,366

126,223

Fixed income

536,727

(2,967
)

-

17,705

10,562

562,027

551,117

Multi-asset

276,933

16,692

-

21,531

12,577

327,733

301,793

Alternatives

75,615

2,367

3,264

2,021

1,831

85,098

79,818

Active subtotal

1,009,974

3,735

3,264

59,280

28,971

1,105,224

1,058,951

Index:

Equity

1,389,004

(25,778
)

-

193,874

30,936

1,588,036

1,504,119

Fixed income

498,675

63,528

-

97

29,478

591,778

540,163

Multi-asset

6,928

(500
)

-

1,098

215

7,741

7,518

Alternatives

7,074

(367
)

-

194

245

7,146

7,538

Index subtotal

1,901,681

36,883

-

195,263

60,874

2,194,701

2,059,338

Institutional subtotal

2,911,655

40,618

3,264

254,543

89,845

3,299,925

3,118,289

Long-term

4,741,486

249,660

3,264

433,245

121,228

5,548,883

5,167,008

Cash management

403,584

14,854

-

850

6,135

425,423

406,729

Advisory⁽⁴⁾

2,782

(188
)

-

(189
)

181

2,586

2,691

Total

$
5,147,852

$
264,326

$
3,264

$
433,906

$
127,544

$
5,976,892

$
5,576,428

	December 31,		Net inflows					Market			FX			September 30,		Average
(in millions)	2020		(outflows)			Acquisition⁽¹⁾		change			impact⁽²⁾			2021		AUM⁽³⁾
Retail:
Equity	$	338,434	$	34,153		$	41,324	$	35,459		$	(3,633	)	$	445,737	$	417,230
Fixed income		340,468		26,011			—		(4,457	)		(2,861	)		359,161		354,337
Multi-asset		132,624		10,269			—		8,505			(445	)		150,953		143,345
Alternatives		34,391		10,139			—		468			(222	)		44,776		39,976
Retail subtotal		845,917		80,572			41,324		39,975			(7,161	)		1,000,627		954,888
ETFs:
Equity		1,905,101		152,785			—		202,397			(9,434	)		2,250,849		2,142,649
Fixed income		690,033		45,804			—		(14,826	)		(4,415	)		716,596		694,541
Multi-asset		6,268		1,539			—		349			(6	)		8,150		7,279
Alternatives		67,605		1,463			—		(5,837	)		(75	)		63,156		66,272
ETFs subtotal		2,669,007		201,591			—		182,083			(13,930	)		3,038,751		2,910,741
Institutional:
Active:
Equity		169,522		(1,561	)		—		16,555			(2,284	)		182,232		179,247
Fixed income		716,269		5,606			—		(7,030	)		(6,147	)		708,698		710,668
Multi-asset		511,242		69,106			—		33,655			(8,706	)		605,297		556,569
Alternatives		127,429		12,407			—		3,682			(1,200	)		142,318		135,656
Active subtotal		1,524,462		85,558			—		46,862			(18,337	)		1,638,545		1,582,140
Index:
Equity		2,006,749		(128,801	)		—		264,183			(22,539	)		2,119,592		2,101,940
Fixed income		927,718		52,024			—		(25,447	)		(24,851	)		929,444		933,212
Multi-asset		8,599		(90	)		—		517			(268	)		8,758		8,919
Alternatives		5,617		(538	)		—		908			(89	)		5,898		5,680
Index subtotal		2,948,683		(77,405	)		—		240,161			(47,747	)		3,063,692		3,049,751
Institutional subtotal		4,473,145		8,153			—		287,023			(66,084	)		4,702,237		4,631,891
Long-term		7,988,069		290,316			41,324		509,081			(87,175	)	��	8,741,615		8,497,520
Cash management		666,252		50,132			—		(996	)		(3,373	)		712,015		704,580
Advisory⁽⁴⁾		22,359		(12,530	)		—		200			3			10,032		18,838
Total	$	8,676,680	$	327,918		$	41,324	$	508,285		$	(90,545	)	$	9,463,662	$	9,220,938

⁽¹⁾ ~~Amount represents AUM acquired in the First Reserve Transaction.~~

⁽²⁾⁽¹⁾

Amounts include AUM attributable to the Aperio Transaction.

⁽²⁾	Foreign exchange reflects the impact of translating ~~non-U.S.~~non-US dollar denominated AUM into ~~U.S.~~US dollars for reporting purposes.

⁽³⁾	Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing ten 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.

The following table presents the component changes in AUM by investment style and product type for the nine months ended September 30, ~~2017.~~2021.


	December 31,		Net inflows					Market			FX		September 30,		Average		December 31,		Net inflows					Market			FX			September 30,		Average
(in millions)	2016		(outflows)			Acquisition⁽¹⁾		change			impact⁽²⁾		2017		AUM⁽³⁾		2020		(outflows)			Acquisition⁽¹⁾		change			impact⁽²⁾			2021		AUM⁽³⁾
Active:
Equity	$	275,033	$	(17,475	)	$	-	$	34,966		$	7,652	$	300,176	$	289,036	$	410,189	$	34,854		$	—	$	34,944		$	(4,755	)	$	475,232	$	457,458
Fixed income		749,996		10,910			-		23,502			13,432		797,840		775,996		1,035,015		29,461			—		(10,534	)		(8,645	)		1,045,297		1,043,135
Multi-asset		384,930		15,845			-		31,536			13,484		445,795		414,624		643,864		79,374			—		42,158			(9,151	)		756,245		699,909
Alternatives		91,093		2,209			3,264		2,746			2,229		101,541		96,339		161,819		22,544			—		4,153			(1,423	)		187,093		175,631
Active subtotal		1,501,052		11,489			3,264		92,750			36,797		1,645,352		1,575,995		2,250,887		166,233			—		70,721			(23,974	)		2,463,867		2,376,133
Index and iShares ETFs:
iShares ETFs:
Index and ETFs:
ETFs:
Equity		951,252		129,488			-		134,562			13,093		1,228,395		1,095,500		1,905,101		152,785			—		202,397			(9,434	)		2,250,849		2,142,649
Fixed income		314,707		58,779			-		5,105			7,676		386,267		351,985		690,033		45,804			—		(14,826	)		(4,415	)		716,596		694,541
Multi-asset		3,149		61			-		272			9		3,491		3,122		6,268		1,539			—		349			(6	)		8,150		7,279
Alternatives		18,771		2,213			-		1,138			162		22,284		20,470		67,605		1,463			—		(5,837	)		(75	)		63,156		66,272
iShares ETFs subtotal		1,287,879		190,541			-		141,077			20,940		1,640,437		1,471,077
Non-ETF Index
ETFs subtotal																		2,669,007		201,591			—		182,083			(13,930	)		3,038,751		2,910,741
Non-ETF Index:
Equity		1,430,891		(17,651	)		-		197,823			32,831		1,643,894		1,553,530		2,104,516		(131,063	)		41,324		281,253			(23,701	)		2,272,329		2,240,959
Fixed income		507,662		66,148			-		303			30,200		604,313		551,349		949,440		54,180			—		(26,400	)		(25,214	)		952,006		955,082
Multi-asset		6,928		(500	)		-		1,098			215		7,741		7,518		8,601		(89	)		—		519			(268	)		8,763		8,924
Alternatives		7,074		(367	)		-		194			245		7,146		7,539		5,618		(536	)		—		905			(88	)		5,899		5,681
Non-ETF Index subtotal		1,952,555		47,630			-		199,418			63,491		2,263,094		2,119,936		3,068,175		(77,508	)		41,324		256,277			(49,271	)		3,238,997		3,210,646
Index & iShares ETFs subtotal		3,240,434		238,171			-		340,495			84,431		3,903,531		3,591,013
Index & ETFs subtotal																		5,737,182		124,083			41,324		438,360			(63,201	)		6,277,748		6,121,387
Long-term		4,741,486		249,660			3,264		433,245			121,228		5,548,883		5,167,008		7,988,069		290,316			41,324		509,081			(87,175	)		8,741,615		8,497,520
Cash management		403,584		14,854			-		850			6,135		425,423		406,729		666,252		50,132			—		(996	)		(3,373	)		712,015		704,580
Advisory⁽⁴⁾		2,782		(188	)		-		(189	)		181		2,586		2,691		22,359		(12,530	)		—		200			3			10,032		18,838
Total	$	5,147,852	$	264,326		$	3,264	$	433,906		$	127,544	$	5,976,892	$	5,576,428	$	8,676,680	$	327,918		$	41,324	$	508,285		$	(90,545	)	$	9,463,662	$	9,220,938

The following table presents the component changes in AUM by product type for the nine months ended September 30, ~~2017.~~2021.

	December 31,		Net inflows					Market				FX		September 30,		Average		December 31,		Net inflows					Market			FX			September 30,		Average
(in millions)	2016		(outflows)			Acquisition⁽¹⁾		change				impact⁽²⁾		2017		AUM⁽³⁾		2020		(outflows)			Acquisition⁽¹⁾		change			impact⁽²⁾			2021		AUM⁽³⁾
Equity	$	2,657,176	$	94,362		$	-	$	367,351			$	53,576	$	3,172,465	$	2,938,066	$	4,419,806	$	56,576		$	41,324	$	518,594		$	(37,890	)	$	4,998,410	$	4,841,066
Fixed income		1,572,365		135,837			-		28,910				51,308		1,788,420		1,679,330		2,674,488		129,445			—		(51,760	)		(38,274	)		2,713,899		2,692,758
Multi-asset		395,007		15,406			-		32,906				13,708		457,027		425,264		658,733		80,824			—		43,026			(9,425	)		773,158		716,112
Alternatives:
Core		88,630		2,353			3,264		2,753				2,168		99,168		93,963
Illiquid alternatives																			85,770		12,315			—		1,148			(912	)		98,321		93,102
Liquid alternatives																			73,218		9,455			—		2,745			(366	)		85,052		79,234
Currency and commodities⁽⁵⁾		28,308		1,702			-		1,325				468		31,803		30,385		76,054		1,701			—		(4,672	)		(308	)		72,775		75,248
Alternatives subtotal		116,938		4,055			3,264		4,078				2,636		130,971		124,348		235,042		23,471			—		(779	)		(1,586	)		256,148		247,584
Long-term		4,741,486		249,660			3,264		433,245				121,228		5,548,883		5,167,008		7,988,069		290,316			41,324		509,081			(87,175	)		8,741,615		8,497,520
Cash management		403,584		14,854			-		850				6,135		425,423		406,729		666,252		50,132			—		(996	)		(3,373	)		712,015		704,580
Advisory⁽⁴⁾		2,782		(188	)		-		(189	)			181		2,586		2,691		22,359		(12,530	)		—		200			3			10,032		18,838
Total	$	5,147,852	$	264,326		$	3,264	$	433,906		��	$	127,544	$	5,976,892	$	5,576,428	$	8,676,680	$	327,918		$	41,324	$	508,285		$	(90,545	)	$	9,463,662	$	9,220,938

⁽¹⁾	~~Amount represents~~Amounts include AUM ~~acquired in~~attributable to the ~~First Reserve~~Aperio Transaction.

⁽²⁾ ~~Foreign exchange reflects the impact of translating non-U.S. dollar denominated AUM into U.S. dollars for reporting purposes.~~

⁽³⁾⁽²⁾

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

⁽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.

⁽⁴⁾	Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing ten months.

⁽⁴⁾⁽⁵⁾

~~Advisory AUM represents long-term portfolio liquidation assignments.~~

⁽⁵⁾	Amounts include commodity ~~iShares~~ ETFs.

AUM increased ~~$829.0~~$787 billion ~~or 16%,~~ to ~~$6.0~~$9.5 trillion at September 30, ~~2017 from $5.1 trillion at December 31, 2016,~~ 2021, driven by net market appreciation, positive net inflows, and AUM acquired in the Aperio Transaction, partially offset by the impact of foreign exchange ~~movements and AUM acquired in the First Reserve Transaction.~~movements.

~~Net market appreciation of $433.9 billion was primarily driven by higher U.S. and global equity markets.~~

Long-term net inflows of ~~$249.7~~$290 billion were comprised of net inflows of ~~$190.5~~$202 billion, ~~$40.6~~$81 billion and ~~$18.5~~$8 billion ~~from~~ ~~iShares~~ into ETFs,, ~~institutional clients~~ retail and ~~retail clients,~~institutional, respectively. Net flows in long-term products are described below.

~~iShares~~ ETFs net inflows of $190.5 billion were led by equity net inflows of $129.5 billion, driven by both U.S. and international equity market exposures. Fixed income net inflows of $58.8 billion reflected inflows into corporate investment grade, emerging markets debt and treasury bond funds.

~~Institutional index net inflows of $36.9 billion were driven by fixed income net inflows of $63.5 billion, partially offset by equity net outflows of $25.8 billion.~~

Retail net inflows of $18.5 billion reflected net inflows of $12.2 billion internationally and $6.3 billion in the United States. Retail net inflows were led by fixed income net inflows of $16.5 billion, reflecting inflows into emerging markets, municipal bond funds and unconstrained strategies.

•

ETFs net inflows of $202 billion reflected positive flows across core equity, strategic and precision ETFs, and across asset classes. Equity net inflows of $153 billion were driven by both US and international equity market exposures. Fixed income net inflows of $46 billion were led by flows into inflation-protected, emerging market, municipal and core bond ETFs. By region, ETFs inflows were diversified with $125 billion of net inflows in US-listed ETFs and $64 billion of net inflows in European-listed ETFs.

•

Retail net inflows of $81 billion primarily reflected net inflows of $46 billion and $34 billion in the US and internationally, respectively. Retail net inflows reflected strength in thematic and US growth equity funds, unconstrained, municipal and total return fixed income funds, multi-asset and alternatives funds.

•

Institutional active net inflows of ~~$3.7~~$86 billion ~~primarily~~included the previously disclosed impact of a significant OCIO mandate from a UK pension client in the second quarter of 2021 and a more recent significant OCIO mandate from an Asia-Pacific client, and also reflected continued growth in LifePath target-date funds, active ~~multi-asset net inflows of $16.7 billion, partially offset by active equity~~fixed income strategies and illiquid alternatives.

•

Institutional index net outflows of ~~$12.4 billion. Multi-asset net inflows were driven by ongoing demand for~~$77 billion included the ~~LifePath~~^® ~~target-date series.~~previously disclosed impact of a $58 billion low-fee institutional index redemption in the second quarter of 2021. Equity net outflows of ~~$12.4~~$129 billion were ~~primarily from U.S. equity and global strategies.~~ partially offset by fixed income net inflows of $52 billion.

Cash management AUM increased 5% to ~~$425.4~~$712 billion, driven by ~~$14.9~~net inflows of $50 billion.

Net market appreciation of $508 billion ~~of net inflows.~~was driven primarily by global equity market appreciation.

AUM ~~increased $127.5~~decreased $91 billion due to the negative impact of foreign exchange movements, primarily resulting from the ~~weakening~~strengthening of the ~~U.S.~~US dollar, largely against the ~~British pound~~Euro and the ~~Euro.~~Japanese yen.

Component Changes in AUM for the Twelve Months Ended September 30, ~~2017~~2021

The following table presents the component changes in AUM by client type and product type for the twelve months ended September 30, ~~2017.~~2021.

	September 30,		Net inflows					Market			FX			September 30,		Average		September 30,		Net inflows					Market			FX			September 30,		Average
(in millions)	2016		(outflows)			Acquisition⁽¹⁾		change			impact⁽²⁾			2017		AUM⁽³⁾		2020		(outflows)			Acquisition⁽¹⁾		change			impact⁽²⁾			2021		AUM⁽³⁾
Retail:
Equity	$	196,131	$	4,751		$	-	$	22,417		$	2,369		$	225,668	$	207,806	$	279,427	$	50,248		$	41,324	$	73,968		$	770		$	445,737	$	387,825
Fixed income		230,842		14,666			-		1,204			1,636			248,348		234,080		316,008		40,231			—		2,060			862			359,161		347,052
Multi-asset		111,369		(2,548	)		-		8,891			350			118,062		111,957		119,708		12,914			—		18,198			133			150,953		138,466
Alternatives		16,436		(814	)		-		693			128			16,443		16,435		31,121		12,496			—		1,081			78			44,776		38,183
Retail subtotal		554,778		16,055			-		33,205			4,483			608,521		570,278		746,264		115,889			41,324		95,307			1,843			1,000,627		911,526
iShares ETFs:
ETFs:
Equity		891,010		180,138			-		150,283			6,964			1,228,395		1,049,435		1,586,849		218,042			—		446,634			(676	)		2,250,849		2,028,304
Fixed income		329,462		58,453			-		(5,239	)		3,591			386,267		345,114		662,999		59,339			—		(6,063	)		321			716,596		689,132
Multi-asset		2,506		755			-		223			7			3,491		2,999		5,430		1,955			—		736			29			8,150		6,895
Alternatives		23,188		495			-		(1,448	)		49			22,284		20,724		66,057		1,008			—		(3,935	)		26			63,156		65,933
iShares ETFs subtotal		1,246,166		239,841			-		143,819			10,611			1,640,437		1,418,272
ETFs subtotal																			2,321,335		280,344			—		437,372			(300	)		3,038,751		2,790,264
Institutional:
Active:
Equity		123,770		(15,161	)		-		20,675			1,082			130,366		124,915		149,260		(4,379	)		—		37,231			120			182,232		173,263
Fixed income		560,799		(1,700	)		-		3,168			(240	)		562,027		550,908		693,061		9,122			—		5,825			690			708,698		707,349
Multi-asset		280,406		22,351			-		19,126			5,850			327,733		295,524		464,242		66,535			—		74,282			238			605,297		536,848
Alternatives		74,678		4,553			3,264		2,092			511			85,098		78,678		120,559		15,635			—		5,555			569			142,318		132,368
Active subtotal		1,039,653		10,043			3,264		45,061			7,203			1,105,224		1,050,025		1,427,122		86,913			—		122,893			1,617			1,638,545		1,549,828
Index:
Equity		1,355,128		(17,400	)		-		246,625			3,683			1,588,036		1,468,656		1,768,582		(159,258	)		—		508,028			2,240			2,119,592		2,034,356
Fixed income		507,165		89,725			-		(15,805	)		10,693			591,778		528,790		859,397		83,457			—		(16,605	)		3,195			929,444		919,677
Multi-asset		7,980		(296	)		-		371			(314	)		7,741		7,603		8,866		(982	)		—		1,029			(155	)		8,758		8,804
Alternatives		7,228		(543	)		-		408			53			7,146		7,440		4,563		150			—		1,186			(1	)		5,898		5,512
Index subtotal		1,877,501		71,486			-		231,599			14,115			2,194,701		2,012,489		2,641,408		(76,633	)		—		493,638			5,279			3,063,692		2,968,349
Institutional subtotal		2,917,154		81,529			3,264		276,660			21,318			3,299,925		3,062,514		4,068,530		10,280			—		616,531			6,896			4,702,237		4,518,177
Long-term		4,718,098		337,425			3,264		453,684			36,412			5,548,883		5,051,064		7,136,129		406,513			41,324		1,149,210			8,439			8,741,615		8,219,967
Cash management		388,982		32,526			-		1,074			2,841			425,423		404,180		652,002		59,076			—		(1,215	)		2,152			712,015		695,260
Advisory⁽⁴⁾		10,341		(7,573	)		-		(137	)		(45	)		2,586		4,323		20,366		(10,738	)		—		377			27			10,032		19,358
Total	$	5,117,421	$	362,378		$	3,264	$	454,621		$	39,208		$	5,976,892	$	5,459,567	$	7,808,497	$	454,851		$	41,324	$	1,148,372		$	10,618		$	9,463,662	$	8,934,585

⁽¹⁾ ~~Amount represents AUM acquired in the First Reserve Transaction.~~

⁽²⁾⁽¹⁾

Amounts include AUM attributable to the Aperio Transaction.

⁽²⁾	Foreign exchange reflects the impact of translating ~~non-U.S.~~non-US dollar denominated AUM into ~~U.S.~~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.

The following table presents the component changes in AUM by investment style and product type for the twelve months ended September 30, ~~2017.~~2021.

	September 30,		Net inflows					Market			FX			September 30,		Average		September 30,		Net inflows					Market			FX			September 30,		Average
(in millions)	2016		(outflows)			Acquisition⁽¹⁾		change			impact⁽²⁾			2017		AUM⁽³⁾		2020		(outflows)			Acquisition⁽¹⁾		change			impact⁽²⁾			2021		AUM⁽³⁾
Active:
Equity	$	281,726	$	(22,023	)	$	-	$	38,028		$	2,445		$	300,176	$	285,819	$	347,631	$	43,476		$	—	$	84,336		$	(211	)	$	475,232	$	434,610
Fixed income		782,858		9,427			-		4,516			1,039			797,840		774,433		989,412		46,244			—		8,559			1,082			1,045,297		1,032,919
Multi-asset		391,775		19,803			-		28,017			6,200			445,795		407,481		583,952		79,443			—		92,479			371			756,245		675,310
Alternatives		91,114		3,739			3,264		2,785			639			101,541		95,113		151,678		28,130			—		6,638			647			187,093		170,550
Active subtotal		1,547,473		10,946			3,264		73,346			10,323			1,645,352		1,562,846		2,072,673		197,293			—		192,012			1,889			2,463,867		2,313,389
Index and iShares ETFs:
iShares ETFs:
Index and ETFs:
ETFs:
Equity		891,010		180,138			-		150,283			6,964			1,228,395		1,049,435		1,586,849		218,042			—		446,634			(676	)		2,250,849		2,028,304
Fixed income		329,462		58,453			-		(5,239	)		3,591			386,267		345,114		662,999		59,339			—		(6,063	)		321			716,596		689,132
Multi-asset		2,506		755			-		223			7			3,491		2,999		5,430		1,955			—		736			29			8,150		6,895
Alternatives		23,188		495			-		(1,448	)		49			22,284		20,724		66,057		1,008			—		(3,935	)		26			63,156		65,933
iShares ETFs subtotal		1,246,166		239,841			-		143,819			10,611			1,640,437		1,418,272
ETFs subtotal																			2,321,335		280,344			—		437,372			(300	)		3,038,751		2,790,264
Non-ETF Index:
Equity		1,393,303		(5,787	)		-		251,689			4,689			1,643,894		1,515,558		1,849,638		(156,865	)		41,324		534,891			3,341			2,272,329		2,160,834
Fixed income		515,948		93,264			-		(15,949	)		11,050			604,313		539,345		879,054		86,566			—		(17,279	)		3,665			952,006		941,159
Multi-asset		7,980		(296	)		-		371			(314	)		7,741		7,603		8,864		(976	)		—		1,030			(155	)		8,763		8,808
Alternatives		7,228		(543	)		-		408			53			7,146		7,440		4,565		151			—		1,184			(1	)		5,899		5,513
Non-ETF Index subtotal		1,924,459		86,638			-		236,519			15,478			2,263,094		2,069,946		2,742,121		(71,124	)		41,324		519,826			6,850			3,238,997		3,116,314
Index & iShares ETFs subtotal		3,170,625		326,479			-		380,338			26,089			3,903,531		3,488,218
Index & ETFs subtotal																			5,063,456		209,220			41,324		957,198			6,550			6,277,748		5,906,578
Long-term		4,718,098		337,425			3,264		453,684			36,412			5,548,883		5,051,064		7,136,129		406,513			41,324		1,149,210			8,439			8,741,615		8,219,967
Cash management		388,982		32,526			-		1,074			2,841			425,423		404,180		652,002		59,076			—		(1,215	)		2,152			712,015		695,260
Advisory⁽⁴⁾		10,341		(7,573	)		-		(137	)		(45	)		2,586		4,323		20,366		(10,738	)		—		377			27			10,032		19,358
Total	$	5,117,421	$	362,378		$	3,264	$	454,621		$	39,208		$	5,976,892	$	5,459,567	$	7,808,497	$	454,851		$	41,324	$	1,148,372		$	10,618		$	9,463,662	$	8,934,585

The following table presents the component changes in AUM by product type for the twelve months ended September 30, ~~2017.~~2021.

	September 30,		Net inflows					Market			FX			September 30,		Average		September 30,		Net inflows					Market			FX			September 30,		Average
(in millions)	2016		(outflows)			Acquisition⁽¹⁾		change			impact⁽²⁾			2017		AUM⁽³⁾		2020		(outflows)			Acquisition⁽¹⁾		change			impact⁽²⁾			2021		AUM⁽³⁾
Equity	$	2,566,039	$	152,328		$	-	$	440,000		$	14,098		$	3,172,465	$	2,850,812	$	3,784,118	$	104,653		$	41,324	$	1,065,861		$	2,454		$	4,998,410	$	4,623,748
Fixed income		1,628,268		161,144			-		(16,672	)		15,680			1,788,420		1,658,892		2,531,465		192,149			—		(14,783	)		5,068			2,713,899		2,663,210
Multi-asset		402,261		20,262			-		28,611			5,893			457,027		418,083		598,246		80,422			—		94,245			245			773,158		691,013
Alternatives:
Core		88,731		3,569			3,264		2,773			831			99,168		92,758
Illiquid alternatives																			79,723		16,844			—		1,660			94			98,321		90,319
Liquid alternatives																			69,255		10,492			—		4,653			652			85,052		77,069
Currency and commodities⁽⁵⁾		32,799		122			-		(1,028	)		(90	)		31,803		30,519		73,322		1,953			—		(2,426	)		(74	)		72,775		74,608
Alternatives subtotal		121,530		3,691			3,264		1,745			741			130,971		123,277		222,300		29,289			—		3,887			672			256,148		241,996
Long-term		4,718,098		337,425			3,264		453,684			36,412			5,548,883		5,051,064		7,136,129		406,513			41,324		1,149,210			8,439			8,741,615		8,219,967
Cash management		388,982		32,526			-		1,074			2,841			425,423		404,180		652,002		59,076			—		(1,215	)		2,152			712,015		695,260
Advisory⁽⁴⁾		10,341		(7,573	)		-		(137	)		(45	)		2,586		4,323		20,366		(10,738	)		—		377			27			10,032		19,358
Total	$	5,117,421	$	362,378		$	3,264	$	454,621		$	39,208		$	5,976,892	$	5,459,567	$	7,808,497	$	454,851		$	41,324	$	1,148,372		$	10,618		$	9,463,662	$	8,934,585

⁽¹⁾ ~~Amount represents AUM acquired in the First Reserve Transaction.~~

⁽²⁾ ~~Foreign exchange reflects the impact of translating non-U.S. dollar denominated AUM into U.S. dollars for reporting purposes.~~

⁽³⁾⁽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.

⁽⁵⁾	Amounts include commodity ~~iShares~~ ETFs.

AUM increased ~~$859.5 billion, or 17%,~~$1.7 trillion to ~~$6.0~~$9.5 trillion at September 30, ~~2017 from $5.1 trillion at September 30, 2016,~~ 2021, driven by net market appreciation, positive net inflows, the positive impact of foreign exchange movements and AUM acquired in the ~~First Reserve~~Aperio Transaction.

~~Net market appreciation of $454.6 billion was primarily driven by higher U.S. and global equity markets.~~

Long-term net inflows of ~~$337.4~~$407 billion were comprised of net inflows of ~~$239.8~~$280 billion, ~~$81.5~~$116 billion and ~~$16.1~~$10 billion from ~~iShares~~ ETFs,, ~~institutional clients~~ retail and ~~retail clients,~~institutional, respectively. Net flows in long-term products are described below.

•

~~iShares~~ETFs net inflows of ~~$239.8~~$280 billion ~~were led by~~reflected positive flows across core equity, strategic and precision ETFs, and across asset classes. Equity net inflows of ~~$180.1~~$218 billion ~~reflecting demand for~~ ~~iShares~~ ~~Core~~were driven by both US and ~~broad~~international equity market exposures. Fixed income net inflows of ~~$58.5~~$59 billion ~~reflected~~were led by flows into inflation-protected, emerging market, municipal and core bond ETFs. By region, ETFs net inflows ~~into corporate investment grade, emerging markets debt~~were diversified with $173 billion of net inflows in US-listed ETFs and ~~treasury bond funds.~~$91 billion of net inflows in European-listed ETFs.

~~Institutional index net inflows of $71.5 billion were driven by fixed income net inflows of $89.7 billion, partially offset by equity net outflows of $17.4 billion.~~

•

Retail net inflows of $116 billion included net inflows of $56 billion and $60 billion in the US and internationally, respectively. Retail net inflows reflected strength in thematic and US growth equity funds, unconstrained, municipal and total return fixed income funds, multi-asset and alternatives funds.

Institutional active net inflows of $10.0 billion reflected multi-asset net inflows of $22.4 billion and alternatives net inflows of $4.6 billion, partially offset by equity net outflows of $15.2 billion. Multi-asset net inflows were driven by ongoing demand for the ~~LifePath~~ target-date series. Alternatives net inflows of $4.6 billion were led by inflows into infrastructure offerings. Equity net outflows of $15.2 billion were primarily from U.S. equity and global strategies.

•

Institutional active net inflows of $87 billion included the previously disclosed impact of a significant OCIO mandate from a UK pension client in the second quarter of 2021 and a more recent significant OCIO mandate from an Asia-Pacific client, and also reflected continued growth in LifePath target-date funds, active fixed income strategies and illiquid alternatives.

Retail net inflows of $16.1 billion reflected net inflows of $11.5 billion internationally and $4.6 billion in the United States. Retail net inflows primarily reflected net inflows of $14.7 billion from fixed income products, led by core, unconstrained, emerging market and municipal bond strategies, and $4.8 billion from equity products.

•

Institutional index net outflows of $77 billion included the previously discussed impact of a $58 billion low-fee institutional index redemption in the second quarter of 2021. Equity net outflows of $159 billion were partially offset by fixed income net inflows of $83 billion.

Cash management AUM increased 9% to ~~$425.4~~$712 billion, driven by ~~$32.5 billion~~net inflows of ~~net inflows.~~$59 billion.

Net market appreciation of $1.1 trillion was driven by global equity market appreciation.

AUM increased ~~$39.2~~$11 billion due to the positive impact of foreign exchange movements, primarily ~~due to~~resulting from the weakening of the ~~U.S.~~US dollar, largely against the ~~Euro~~British pound and ~~British pound,~~the Canadian dollar, partially offset by the strengthening of the ~~U.S.~~US dollar against the Japanese ~~yen.~~yen and the Euro.

DISCUSSION OF FINANCIAL RESULTS

The Company’s results of operations for the three and nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 are discussed below. For a further description of the Company’s revenue and expense, see the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016~~2020 (“~~2016~~2020 Form 10-K”).

Revenue

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in millions)

2017

2016

2017

2016

Investment advisory, administration fees and
securities lending revenue:

Equity:

Active

$
421

$
409

$
1,235

$
1,201

iShares ETFs

836

691

2,333

1,970

Non-ETF index

170

170

509

508

Equity subtotal

1,427

1,270

4,077

3,679

Fixed income:

Active

442

427

1,281

1,237

iShares ETFs

210

188

595

512

Non-ETF index

88

78

257

217

Fixed income subtotal

740

693

2,133

1,966

Multi-asset

289

285

843

860

Alternatives:

Core

169

156

469

488

Currency and commodities

23

24

67

61

Alternatives subtotal

192

180

536

549

Long-term

2,648

2,428

7,589

7,054

Cash management

144

118

408

340

Total base fees

2,792

2,546

7,997

7,394

Investment advisory performance fees:

Equity

30

14

57

67

Fixed income

9

2

20

9

Multi-asset

2

1

14

6

Alternatives

150

41

218

84

Total performance fees

191

58

309

166

Technology and risk management revenue⁽¹⁾

175

152

497

439

Distribution fees

5

10

17

32

Advisory and other revenue

Advisory⁽¹⁾

25

22

74

78

Other

45

49

128

156

Advisory and other revenue

70

71

202

234

Total revenue

$
3,233

$
2,837

$
9,022

$
8,265

⁽¹⁾

~~Beginning with the first quarter of 2017,~~ ~~Aladdin~~ ~~revenue previously reported within “BlackRock Solutions~~^® ~~and advisory” has been presented within “Technology and risk management revenue” on the condensed consolidated statement of income. The remaining previously reported “BlackRock Solutions~~ ~~and advisory” revenue is currently reported as part of “Advisory and other revenue.” Under the historical presentation,~~ ~~BlackRock Solutions~~ ~~and advisory revenue would have totaled $200 million and $571 million for the three and nine months ended September 30, 2017, respectively. The prior period amounts reported for~~ ~~BlackRock Solutions~~ ~~and advisory of $174 million and $517 million for the three and nine months ended September 30, 2016, respectively, have been reclassified to conform to the current presentation.~~

The table below ~~lists~~presents detail of revenue for the ~~asset~~three and nine months ended September 30, 2021 and 2020 and includes the product type mix of ~~investment advisory, administration~~base fees and securities lending revenue ~~(collectively “base fees”)~~ and ~~mix~~performance fees.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in millions)	2021		2020		2021		2020
Investment advisory, administration fees and securities lending revenue:
Equity:
Active	$	674	$	457	$	1,891	$	1,236
ETFs		1,212		880		3,436		2,551
Non-ETF Index		207		164		581		505
Equity subtotal		2,093		1,501		5,908		4,292
Fixed income:
Active		561		498		1,631		1,443
ETFs		304		297		893		817
Non-ETF Index		121		113		350		354
Fixed income subtotal		986		908		2,874		2,614
Multi-asset		369		289		1,041		852
Alternatives:
Illiquid alternatives		166		140		501		416
Liquid alternatives		163		132		460		361
Currency and commodities⁽¹⁾		55		51		163		118
Alternatives subtotal		384		323		1,124		895
Long-term		3,832		3,021		10,947		8,653
Cash management		111		204		345		593
Total investment advisory, administration fees and securities lending revenue		3,943		3,225		11,292		9,246
Investment advisory performance fees:
Equity		8		4		70		29
Fixed income		2		9		31		13
Multi-asset		—		10		17		13
Alternatives:
Illiquid alternatives		50		6		147		55
Liquid alternatives		285		503		549		575
Alternatives subtotal		335		509		696		630
Total performance fees		345		532		814		685
Technology services revenue		320		282		942		834
Distribution fees:
Retrocessions		294		188		796		519
12b-1 fees (US mutual fund distribution fees)		91		85		263		254
Other		16		15		51		44
Total distribution fees		401		288		1,110		817
Advisory and other revenue:
Advisory		13		14		37		48
Other		28		28		73		97
Total advisory and other revenue		41		42		110		145
Total revenue	$	5,050	$	4,369	$	14,268	$	11,727

⁽¹⁾	Amounts include commodity ETFs.

The table below lists a percentage breakdown of base fees and securities lending revenue and average AUM by product type:

	Three Months Ended September 30,												Nine Months Ended September 30,												Three Months Ended September 30,												Nine Months Ended September 30,
	Mix of Base Fees						Mix of Average AUM by Asset Class⁽¹⁾						Mix of Base Fees						Mix of Average AUM by Asset Class⁽²⁾						Percentage of Base Fees and Securities Lending Revenue						Percentage of Average AUM by Product Type⁽¹⁾						Percentage of Base Fees and Securities Lending Revenue						Percentage of Average AUM by Product Type⁽²⁾
	2017			2016			2017			2016			2017			2016			2017			2016			2021			2020			2021			2020			2021			2020			2021			2020
Equity:
Active		15	%		16	%		5	%		6	%		15	%		16	%		5	%		6	%		18	%		15	%		5	%		4	%		19	%		14	%		5	%		4	%
iShares ETFs		30	%		27	%		20	%		17	%		29	%		27	%		20	%		17	%
Non-ETF index		6	%		7	%		28	%		27	%		6	%		7	%		28	%		27	%
ETFs																										31	%		27	%		24	%		20	%		30	%		28	%		23	%		21	%
Non-ETF Index																										5	%		5	%		23	%		24	%		5	%		5	%		24	%		23	%
Equity subtotal		51	%		50	%		53	%		50	%		50	%		50	%		53	%		50	%		54	%		47	%		52	%		48	%		54	%		47	%		52	%		48	%
Fixed income:
Active		16	%		17	%		13	%		15	%		17	%		16	%		13	%		16	%		13	%		15	%		12	%		13	%		13	%		15	%		11	%		13	%
iShares ETFs		8	%		7	%		6	%		6	%		7	%		7	%		6	%		6	%
Non-ETF index		3	%		3	%		10	%		10	%		3	%		3	%		10	%		10	%
ETFs																										8	%		9	%		7	%		9	%		8	%		9	%		8	%		8	%
Non-ETF Index																										3	%		4	%		10	%		11	%		3	%		4	%		10	%		12	%
Fixed income subtotal		27	%		27	%		29	%		31	%		27	%		26	%		29	%		32	%		24	%		28	%		29	%		33	%		24	%		28	%		29	%		33	%
Multi-asset		10	%		11	%		8	%		8	%		11	%		12	%		8	%		8	%		9	%		9	%		8	%		8	%		9	%		9	%		8	%		8	%
Alternatives:
Core		6	%		6	%		2	%		2	%		6	%		7	%		2	%		2	%
Currency and commodities		1	%		1	%		1	%		1	%		1	%		1	%		1	%		1	%
Illiquid alternatives																										5	%		4	%		1	%		1	%		5	%		5	%		1	%		1	%
Liquid alternatives																										4	%		4	%		1	%		1	%		4	%		4	%		1	%		1	%
Currency and commodities⁽³⁾																										1	%		2	%		1	%		1	%		1	%		1	%		1	%		1	%
Alternatives subtotal		7	%		7	%		3	%		3	%		7	%		8	%		3	%		3	%		10	%		10	%		3	%		3	%		10	%		10	%		3	%		3	%
Long-term		95	%		95	%		93	%		92	%		95	%		96	%		93	%		93	%		97	%		94	%		92	%		92	%		97	%		94	%		92	%		92	%
Cash management		5	%		5	%		7	%		8	%		5	%		4	%		7	%		7	%		3	%		6	%		8	%		8	%		3	%		6	%		8	%		8	%
Total excluding Advisory AUM		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%

⁽¹⁾	Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing four months.

⁽⁽²⁾²⁾

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

⁽³⁾	Amounts include commodity ETFs.

Three Months Ended September 30, ~~2017~~2021 Compared with Three Months Ended September 30, ~~2016~~2020

Revenue increased ~~$396~~$681 million, or ~~14%~~16%, from the ~~third quarter of 2016, driven by~~three months ended September 30, 2020, reflecting market gains as well as strong organic growth and 13% growth in ~~base fees,~~technology services revenue, partially offset bylower performance ~~fees, and technology and risk management revenue.~~fees.

Investment advisory, administration fees and securities lending revenue of ~~$2,792~~$3,943 million increased ~~$246~~$718 million from ~~$2,546~~$3,225 million for the three months ended September 30, 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. Securities lending revenue of $152 million decreased from $153 million in the third quarter of ~~2016,~~2020, primarily reflecting ~~the impact of higher markets and organic growth on average AUM~~,lower asset spreads, partially offset by ~~previously announced pricing changes to select investment products.~~ ~~Securities lending revenue was $150 million in the~~ ~~current quarter compared with $142 million in the third quarter~~higher average balances of ~~2016.~~securities on loan.

Investment advisory performance fees of ~~$191~~$345 million ~~increased $133~~decreased $187 million from $532 million for the ~~third quarter of 2016,~~three months ended September 30, 2020, primarily reflecting ~~improved performance in a broad range of hedge and long-only funds,~~lower revenue from liquid alternative products, including ~~strong performance~~lower fees from a single hedge fund strategy with an annual performance measurement period that ends in the third ~~quarter.~~quarter, partially offset by higher revenue from illiquid alternative products.

Technology ~~and risk management~~services revenue of ~~$175~~$320 million increased ~~$23~~$38 million from ~~$152~~$282 million infor the ~~third quarter of 2016,~~three months ended September 30, 2020, primarily reflecting ~~ongoing demand for~~ higher revenue from Aladdin ~~and other technology offerings.~~.

Nine Months Ended September 30, ~~2017~~2021 Compared with Nine Months Ended September 30, ~~2016~~2020

Revenue increased ~~$757~~$2,541 million, or 9%22%, from the nine months ended September 30, ~~2016, driven by growth in~~2020, reflecting higher base ~~fees,~~and performance fees and higher technology ~~and risk management~~services revenue, partially offset by lower ~~advisory and other~~securities lending revenue.

Investment advisory, administration fees and securities lending revenue of ~~$7,997~~$11,292 million increased ~~$603~~$2,046 million from ~~$7,394~~$9,246 million for the nine months ended September 30, ~~2016, reflecting~~2020, primarily driven by the positive impact of ~~higher markets~~market beta and ~~organic growth~~foreign exchange movements on average AUM and ~~the effect of AUM acquired in the BofA~~^® ~~Global Capital Management transaction,~~organic growth, partially offset by ~~previously announced~~the impact of yield-related fee waivers on certain money market funds and strategic pricing changes to ~~select investment~~certain products,. and lower securities lending revenue. Securities lending revenue ~~was $447~~of $419 million decreased $102 million from $521 million for the nine months ended September 30, ~~2017 compared with $441~~2020, primarily reflecting lower spreads, partially offset by higher average balances of securities on loan.

Investment advisory performance fees of $814 million increased $129 million from $685 million for the nine months ended September 30, ~~2016.~~ 2020, primarily reflecting higher revenue from illiquid alternative and long-only products.

~~Investment advisory performance fees~~Technology services revenue of ~~$309~~$942 million increased ~~$143~~$108 million from the nine months ended September 30, 2016, primarily reflecting improved performance in a broad range of hedge and long-only funds, including strong performance from a single hedge fund with an annual performance measurement period that ends in the third quarter.

~~Technology and risk management revenue~~ ~~of $497 million increased $58 million from $439~~$834 million for the nine months ended September 30, ~~2016~~2020, primarily reflecting ~~ongoing demand for~~ higher revenue from Aladdin ~~and other technology offerings.~~.

Advisory and other revenue of ~~$202~~$110 million decreased ~~$32~~$35 million from ~~$234~~$145 million for the nine months ended September 30, ~~2016,~~2020, primarily reflecting ~~lower fees for distributing certain exchange-traded products,~~the impact of the Charitable Contribution, lower earnings from a strategic minority investment and lower ~~commissions for sales of certain funds.~~fees from advisory assignments.

Expense

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in millions)

2017

2016

2017

2016

Expense, GAAP:

Employee compensation and benefits

$
1,088

$
969

$
3,108

$
2,893

Distribution and servicing costs

123

114

361

320

Amortization of deferred sales commissions

4

8

13

27

Direct fund expense

234

200

666

583

General and administration:

Marketing and promotional

76

72

231

232

Occupancy and office related

68

65

202

208

Portfolio services

68

57

195

164

Technology

51

41

145

129

Professional services

37

27

92

84

Communications

8

9

24

29

Other general and administration

55

41

125

100

Total general and administration expense

363

312

1,014

946

Restructuring charge

—

—

—

76

Amortization of intangible assets

27

25

77

75

Total expense, GAAP

$
1,839

$
1,628

$
5,239

$
4,920

Less non-GAAP expense adjustments:

Employee compensation and benefits:

PNC LTIP funding obligation

4

7

12

21

Restructuring charge

—

—

—

76

Total non-GAAP expense adjustments

4

7

12

97

Expense, as adjusted:

Employee compensation and benefits

$
1,084

$
962

$
3,096

$
2,872

Distribution and servicing costs

123

114

361

320

Amortization of deferred sales commissions

4

8

13

27

Direct fund expense

234

200

666

583

General and administration

363

312

1,014

946

Amortization of intangible assets

27

25

77

75

Total expense, as adjusted

$
1,835

$
1,621

$
5,227

$
4,823

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in millions)	2021		2020		2021		2020
Expense:
Employee compensation and benefits	$	1,527	$	1,411	$	4,484	$	3,700
Distribution and servicing costs:
Retrocessions		294		188		796		519
12b-1 costs		89		83		257		247
Other		202		185		560		564
Total distribution and servicing costs		585		456		1,613		1,330
Direct fund expense		354		257		994		780
General and administration expense:
Marketing and promotional		54		48		142		156
Occupancy and office related		91		81		250		239
Portfolio services		93		73		267		203
Technology		140		93		373		273
Professional services		42		36		122		121
Communications		11		14		33		40
Foreign exchange remeasurement		1		1		3		7
Contingent consideration fair value adjustments		29		—		33		23
Product launch costs		96		80		274		164
Charitable Contribution		—		—		—		589
Other general and administration		54		35		160		176
Total general and administration expense		611		461		1,657		1,991
Amortization of intangible assets		38		27		109		79
Total expense	$	3,115	$	2,612	$	8,857	$	7,880

Three Months Ended September 30, ~~2017~~2021 Compared with Three Months Ended September 30, ~~2016~~2020

~~GAAP~~. Expense increased ~~$211~~$503 million from the ~~third quarter of 2016,~~three months ended September 30, 2020, largely driven ~~primarily~~ by higher general and administration expense, higher employee compensation and benefits expense ~~higher general and administration expense,~~ and higher direct fund ~~expense.~~

~~Employee compensation and benefits~~ expense increased $119 million, or 12%, from the third quarter of 2016, primarily reflecting higher incentive compensation, driven primarily by higher performance fees and operating income, and higher headcount. Employees at September 30, 2017 totaled approximately 13,700 compared with approximately 13,000 at September 30, 2016.

~~Direct fund expense~~ ~~increased $34 million from the third quarter of 2016, reflecting higher average AUM.~~

~~General and administration expense~~ increased $51 million from the third quarter of 2016, reflecting higher portfolio services, technology, and professional services expense, as well as increased foreign exchange remeasurement expense and contingent consideration fair value adjustments.

~~As Adjusted. Expense, as adjusted, increased $214 million, or 13%, to $1,835 million from $1,621 million~~ in the third quarter of ~~2016. The increase in total expense, as adjusted, is driven primarily by higher employee~~2021.

Employee compensation and benefits expense increased $116 million from the three months ended September 30, 2020, primarily reflecting higher ~~general~~base compensation, driven by previously announced base salary increases and higher headcount, and higher deferred compensation, reflecting the impact of additional grants associated with prior-year compensation.

Direct fund expense increased $97 million from the three months ended September 30, 2020, primarily reflecting higher average AUM.

General and administration expense increased $150 million from the three months ended September 30, 2020, reflecting higher technology and portfolio services expense. The increase also reflected higher ~~direct fund expense.~~product launch costs, primarily associated with the previously discussed BlackRock ESG Capital Allocation Trust, higher contingent consideration fair value adjustments, and $11 million of previously discussed noncash Lease cost – Hudson Yards.

Amortization of intangible assets expense increased $11 million from the three months ended September 30, 2020, primarily reflecting amortization of intangible assets related to the Aperio Transaction.

Nine Months Ended September 30, ~~2017~~2021 Compared with Nine Months Ended September 30, ~~2016~~2020

~~GAAP~~. Expense increased ~~$319~~$977 million from the nine months ended September 30, ~~2016,~~2020, largely driven ~~primarily~~ by higher employee compensation and benefits expense and higher ~~direct fund~~volume-related expense, ~~higher~~partially offset by lower general and administration expense, ~~and approximately $22 million of expense associated with~~reflecting the ~~strategic repositioning~~impact of the ~~active equity platform, partially offset by a restructuring charge~~ Charitable Contribution recorded in ~~the first quarter of 2016.~~

~~Employee compensation and benefits expense~~ ~~increased $215 million, or 7%, from~~ the nine months ended September 30, ~~2016, reflecting~~2020. Expense also reflected higher ~~incentive compensation, higher headcount, and approximately $20 million of severance and accelerated compensation expense associated with the repositioning of the active equity platform.~~

~~Distribution and servicing~~product launch costs ~~increased $41 million, or 13%, from~~ during the nine months ended September 30, ~~2016, reflecting higher average AUM~~2021.

Employee compensation and ~~the effect of AUM acquired in the BofA Global Capital Management transaction.~~

~~Direct fund~~benefits expense increased ~~$83~~$784 million from the nine months ended September 30, ~~2016,~~2020, primarily reflecting higher ~~average AUM.~~base and incentive compensation, driven by higher operating income and higher performance fees, and higher deferred compensation.

~~General and administration~~Direct fund expense increased ~~$68~~$214 million from the nine months ended September 30, ~~2016,~~2020, primarily reflecting higher ~~portfolio services~~average AUM.

General and ~~technology~~administration expense ~~and the impact of foreign exchange remeasurement expense.~~

~~As Adjusted. Expense, as adjusted, increased $404 million, or 8%, to $5,227~~ decreased $334 million from ~~$4,823 million~~the nine months ended September 30, 2020, largely driven by the Charitable Contribution recorded in the nine months ended September 30, ~~2016. The increase in total expense, as adjusted, is driven primarily by higher employee compensation and benefit expense, higher direct fund expense, higher general~~2020. General and administration expense also reflected higher expense during the nine months ended September 30, 2021 related to product launch costs, technology and portfolio services expense, higher contingent consideration fair value adjustments, and Lease cost – Hudson Yards described above, partially offset by lower marketing and promotional expense and the ~~$22~~impact of costs related to certain legal matters incurred during the nine months ended September 30, 2020.

Amortization of intangible assets expense increased $30 million ~~expense associated with the repositioning of the active equity platform. The restructuring charge recorded in the first quarter of 2016 has been excluded~~ from the ~~as adjusted results.~~ nine months ended September 30, 2020, primarily reflecting amortization of intangible assets related to the Aperio Transaction.

Nonoperating Results

The summary ~~and reconciliation~~ of ~~U.S. GAAP nonoperating income (expense) to~~ nonoperating income (expense), ~~as adjusted~~less net income (loss) attributable to NCI for the three and nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 was as follows:

	Three Months Ended						Nine Months Ended						Three Months Ended				Nine Months Ended
	September 30,						September 30,						September 30,				September 30,
(in millions)	2017			2016			2017			2016			2021		2020		2021		2020
Nonoperating income (expense), GAAP basis⁽¹⁾	$	10		$	1		$	4		$	(72	)	$	336	$	224	$	652	$	510
Less: Net income (loss) attributable to NCI		12			2			31			(2	)		72		153		315		162
Nonoperating income (expense), as adjusted, net of NCI⁽²⁾⁽³⁾	$	(2	)	$	(1	)	$	(27	)	$	(70	)
Nonoperating income (expense), net of NCI⁽²⁾													$	264	$	71	$	337	$	348

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(in millions)	2021			2020			2021			2020
Net gain (loss) on investments⁽¹⁾⁽²⁾
Private equity	$	124		$	18		$	212		$	8
Real assets		4			6			10			11
Other alternatives⁽³⁾		13			14			43			10
Other investments⁽⁴⁾		(8	)		55			37			35
Subtotal		133			93			302			64
Gain related to the Charitable Contribution		—			—			—			122
Other gains (losses)⁽⁵⁾		165			23			149			279
Total net gain (loss) on investments⁽¹⁾⁽²⁾		298			116			451			465
Interest and dividend income		14			9			41			34
Interest expense		(48	)		(54	)		(155	)		(151	)
Net interest expense		(34	)		(45	)		(114	)		(117	)
Nonoperating income (expense)⁽¹⁾	$	264		$	71		$	337		$	348

⁽¹⁽¹⁾⁾

~~Amounts include a gain~~Net of ~~$29 million and $19 million for the three months ended September 30, 2017 and 2016, respectively,~~net income (loss) attributable to consolidated variable interest entities (“VIEs”). Amounts include a gain of $95 million and $34 million for the nine months ended September 30, 2017 and 2016, respectively, attributable to consolidated VIEs.NCI.

⁽⁽²⁾²⁾

~~Net of income (loss) attributable to NCI.~~

⁽³⁾

Management believes nonoperating income (expense), ~~as adjusted,~~less net income (loss) attributable to NCI, is an effective measure for reviewing BlackRock’s nonoperating ~~contribution to results.~~results, which ultimately impacts BlackRock’s book value. See Non-GAAP Financial Measures for further information on non-GAAP financial measures for the three and nine months ended September 30, ~~2017~~2021 and ~~2016.~~

~~The components of nonoperating income (expense), as adjusted, for the three and nine months ended September 30, 2017 and 2016 were as follows:~~

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in millions)

2017

2016

2017

2016

Net gain (loss) on investments⁽¹⁾⁽²⁾

Private equity

$
7

$
2

$
21

$
11

Real assets

1

2

2

5

Other alternatives⁽³⁾

11

9

34

13

Other investments⁽⁴⁾

10

16

35

22

Subtotal

29

29

92

51

Other gains

—

—

5

—

Total net gain (loss) on investments⁽¹⁾⁽²⁾

29

29

97

51

Interest and dividend income

15

22

35

33

Interest expense

(46
)

(52
)

(159
)

(154
)
Net interest expense

(31
)

(30
)

(124
)

(121
)
Nonoperating income (expense), as adjusted⁽¹⁾⁽²⁾

$
(2
)

$
(1
)

$
(27
)

$
(70
)

⁽¹⁾	~~Net of net income (loss) attributable to NCI. Amounts also include net gain (loss) on consolidated VIEs.~~2020.

⁽⁽³⁾²⁾

~~Management believes nonoperating~~Amounts primarily include net gains (losses) related to credit funds, direct hedge fund strategies and hedge fund solutions.

⁽⁴⁾

Amounts primarily include net gains (losses) related to unhedged equity, fixed income ~~(expense), as adjusted, is an effective measure for reviewing BlackRock’s nonoperating contribution to results. See~~ ~~Non-GAAP Financial Measures~~ ~~for further information on non-GAAP financial measures~~and multi-asset seed investments.

⁽⁵⁾

Amounts for the three and nine months ended September 30, ~~2017~~2021 include nonoperating noncash pre-tax gains in connection with strategic minority investments in iCapital of approximately $107 million and ~~2016.~~Scalable of approximately $46 million. Amount for the nine months ended September 30, 2020 includes a nonoperating pre-tax gain of approximately $240 million in connection with a recapitalization of iCapital. Additional amounts primarily include noncash pre-tax gains (losses) related to the revaluation of certain other corporate minority investments.

Income Tax Expense

	GAAP												As Adjusted⁽¹⁾
	Three Months Ended						Nine Months Ended						Three Months Ended						Nine Months Ended
	September 30,						September 30,						September 30,						September 30,
(in millions)	2021			2020			2021			2020			2021			2020			2021			2020
Operating income⁽¹⁾	$	1,935		$	1,757		$	5,411		$	3,847		$	1,946		$	1,757		$	5,422		$	4,436
Total nonoperating income (expense)⁽¹⁾⁽²⁾	$	264		$	71		$	337		$	348		$	264		$	71		$	337		$	226
Income before income taxes	$	2,199		$	1,828		$	5,748		$	4,195		$	2,210		$	1,828		$	5,759		$	4,662
Income tax expense	$	518		$	464		$	1,490		$	811		$	520		$	410		$	1,321		$	998
Effective tax rate		23.6	%		25.4	%		25.9	%		19.3	%		23.6	%		22.5	%		22.9	%		21.4	%

⁽¹⁾	As adjusted items are described in more detail in Non-GAAP Financial Measures.

⁽⁽²⁾³⁾

~~Amounts primarily include~~Net of net ~~gains (losses) related~~income (loss) attributable to ~~direct hedge fund strategies and hedge fund solutions.~~

⁽⁴⁾	~~Amounts primarily include net gains (losses) related to equity and fixed income investments.~~NCI.

~~Interest~~2021. Income tax expense for the nine months ended September 30, ~~2017~~2021 included ~~a “make-whole” redemption premium of $14~~$171 million ~~related to refinancing the $700 million 6.25% notes, which were repaid prior to their September 2017 maturity.~~

~~Income Tax Expense~~

GAAP

As Adjusted

Three Months Ended

Nine Months Ended

Three Months Ended

Nine Months Ended

September 30,

September 30,

September 30,

September 30,

(in millions)

2017

2016

2017

2016

2017

2016

2017

2016

Operating income⁽¹⁾

$
1,394

$
1,209

$
3,783

$
3,345

$
1,398

$
1,216

$
3,795

$
3,442

Total nonoperating income (expense)⁽¹⁾⁽²⁾

(2
)

(1
)

(27
)

(70
)

(2
)

(1
)

(27
)

(70
)
Income before income taxes⁽²⁾

$
1,392

$
1,208

$
3,756

$
3,275

$
1,396

$
1,215

$
3,768

$
3,372

Income tax expense

$
445

$
333

$
1,090

$
954

$
427

$
361

$
1,074

$
1,010

Effective tax rate

32.0
%

27.6
%

29.0
%

29.1
%

30.6
%

29.7
%

28.5
%

30.0
%

⁽¹⁾	~~See~~ ~~Non-GAAP Financial Measures~~ ~~for further information on and reconciliation of as adjusted items.~~

⁽²⁾	~~Net of~~noncash net ~~income (loss) attributable to NCI.~~

~~2017.~~ ~~The three and nine months ended September 30, 2017 income tax~~ expense ~~(GAAP) reflected net noncash expense of $19 million~~ related to the revaluation of certain deferred ~~income~~ tax assets and liabilities as a result of ~~domestic state and local~~legislation enacted in the UK increasing its corporate tax ~~changes.~~

~~The~~rate. Income tax expense for the nine months ended September 30, ~~2017 income tax expense (GAAP)~~2021, also ~~included an $81~~reflected $42 million of discrete tax ~~benefit, reflecting the adoption of new accounting guidance~~benefits primarily related to stock-based compensation awards that vested in the first quarter of ~~2017. See Note 2,~~ ~~Significant Accounting Policies, for further information.~~2021.

The as adjusted effective tax rate of ~~30.6% and 28.5%~~22.9% for the ~~three and~~ nine months ended September 30, ~~2017, respectively,~~2021, excluded the ~~net~~impact of $171 million noncash deferred tax revaluation expense ~~of $19 million~~ mentioned above as it will not have a cash flow impact and to ensure comparability among periods presented.

2020. Income tax expense for the nine months ended September 30, 2020, included a discrete tax benefit of $241 million recognized in connection with the Charitable Contribution and $78 million of discrete tax benefits, including benefits related to stock-based compensation awards that vested in the first quarter of 2020.

~~2016.~~The three and nine months ended September 30, ~~2016~~2020 income tax expense ~~(GAAP) reflected:~~

~~a $26~~also included the previously described $54 million noncash net ~~noncash tax benefit, primarily~~expense related to ~~the revaluation of certain deferred income tax liabilities as a result of~~ legislation enacted in the ~~United Kingdom,~~UK.

The as adjusted effective tax rate of 22.5% and ~~domestic state and local tax changes, and~~

~~nonrecurring tax benefits, which totaled $16 million and $35 million~~21.4% for the three and nine months ended September 30, ~~2016, respectively.~~

~~The as adjusted effective tax rate of 29.7% and 30.0% for the three and nine months ended September 30, 2016, respectively,~~2020 excluded the ~~net~~impact of the $54 million noncash ~~benefit of $26 million~~deferred tax revaluation noncash expense mentioned above as it will not have a cash flow impact and to ensure comparability among periods presented.

The as adjusted effective tax rate of 21.4% for the nine months ended September 30, 2020 also excluded the $241 million discrete tax benefit in connection with the Charitable Contribution due to its nonrecurring nature.

~~BALANCE SHEET~~STATEMENT OF FINANCIAL CONDITION OVERVIEW

As Adjusted ~~Balance Sheet~~Statement of Financial Condition

The following table presents a reconciliation of the condensed consolidated statement of financial condition presented on a GAAP basis to the condensed consolidated statement of financial condition, excluding the impact of separate account assets and separate account collateral held under securities lending agreements (directly related to lending separate account securities) and separate account liabilities and separate account collateral liabilities under securities lending agreements and consolidated sponsored investment ~~funds, including consolidated VIEs.~~products (“CIPs”).

The Company presents the as adjusted ~~balance sheet~~statement of financial condition as additional information to enable investors to exclude certain assets that have equal and offsetting liabilities or ~~noncontrolling interests~~NCI that ultimately do not have an impact on stockholders’ equity or cash flows. Management views the as adjusted ~~balance sheet, a~~statement of financial condition, which contains non-GAAP financial ~~measure,~~measures, as an economic presentation of the Company’s total assets and liabilities; however, it 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.

Separate Account Assets and Liabilities and Separate Account Collateral Held under Securities Lending Agreements

Separate account assets are maintained by BlackRock Life Limited, a wholly owned subsidiary of the Company that is a registered life insurance company in the ~~United Kingdom,~~UK, and represent segregated assets held for purposes of funding individual and group pension contracts. The Company records equal and offsetting separate account liabilities. The separate account assets are not available to creditors of the Company and the holders of the pension contracts have no recourse to the Company’s assets. The net investment income attributable to separate account assets accrues directly to the contract owners and is not reported on the condensed consolidated statements of income. While BlackRock has no economic interest in these assets or liabilities, BlackRock earns an investment advisory fee for the service of managing these assets on behalf of its clients.

In addition, the Company records on its condensed consolidated statements of financial condition the separate account collateral received under BlackRock Life Limited securities lending arrangements as its own asset in addition to an equal and offsetting separate account collateral liability for the obligation to return the collateral. The collateral is not available to creditors of the Company, and the borrowers under the securities lending arrangements have no recourse to the Company’s assets.

Consolidated Sponsored Investment ~~Funds~~Products

The Company consolidates certain sponsored investment ~~funds~~products accounted for as variable interest entities (“VIEs”) and voting rights entities (“VREs”) ~~and VIEs,~~, (collectively, ~~“Consolidated Sponsored Investment Funds”~~“consolidated sponsored investment products” or “CIPs”). See Note 2, Significant Accounting Policies, in the notes to the consolidated financial statements contained in the ~~2016~~2020 Form 10-K for more information on the Company’s consolidation policy.

The Company cannot readily access cash and cash equivalents or other assets held by ~~Consolidated Sponsored Investment Funds~~CIPs to use in its operating activities. In addition, the Company cannot readily sell investments held by ~~Consolidated Sponsored Investment Funds~~CIPs in order to obtain cash for use in the Company’s operations.

	September 30, 2017									September 30, 2021
(in millions)	GAAP Basis		Separate Account Assets/ Collateral⁽¹⁾		Consolidated Sponsored Investment Funds⁽²⁾			As Adjusted		GAAP Basis		Separate Account Assets/ Collateral⁽¹⁾		CIPs⁽²⁾		As Adjusted
Assets
Cash and cash equivalents	$	6,165	$	—	$	63		$	6,102	$	7,361	$	—	$	265	$	7,096
Accounts receivable		3,183		—		—			3,183		4,015		—		—		4,015
Investments		1,928		—		28			1,900		7,101		—		1,549		5,552
Assets of consolidated VIEs:
Cash and cash equivalents		82		—		82			—
Investments		1,286		—		238			1,048
Other assets		46		—		46			—
Separate account assets and collateral held under securities lending agreements		175,369		175,369		—			—		110,861		110,861		—		—
Operating lease right-of-use assets											1,798						1,798
Other assets⁽³⁾		1,882		—		8			1,874		4,664		—		96		4,568
Subtotal		189,941		175,369		465			14,107		135,800		110,861		1,910		23,029
Goodwill and intangible assets, net		30,626		—		—			30,626		33,836		—		—		33,836
Total assets	$	220,567	$	175,369	$	465		$	44,733	$	169,636	$	110,861	$	1,910	$	56,865
Liabilities
Accrued compensation and benefits	$	1,614	$	—	$	—		$	1,614	$	2,343	$	—	$	—	$	2,343
Accounts payable and accrued liabilities		1,652		—		—			1,652		1,402		—		—		1,402
Liabilities of consolidated VIEs		319		—		319			—
Borrowings		5,000		—		—			5,000		6,474		—		—		6,474
Separate account liabilities and collateral liabilities under securities lending agreements		175,369		175,369		—			—		110,861		110,861		—		—
Deferred income tax liabilities⁽⁴⁾		4,966		—		—			4,966		3,659		—		—		3,659
Operating lease liabilities											1,946						1,946
Other liabilities		1,230		—		(229	)		1,459		4,585		—		435		4,150
Total liabilities		190,150		175,369		90			14,691		131,270		110,861		435		19,974
Equity
Total stockholders’ equity		30,042		—		—			30,042
Total BlackRock, Inc. stockholders’ equity											36,817		—		—		36,817
Noncontrolling interests		375		—		375			—		1,549		—		1,475		74
Total equity		30,417		—		375			30,042		38,366		—		1,475		36,891
Total liabilities and equity	$	220,567	$	175,369	$	465		$	44,733	$	169,636	$	110,861	$	1,910	$	56,865

⁽¹⁾	Amounts represent segregated client assets ~~generating advisory fees~~and related liabilities, in which BlackRock has no economic ~~interest or liability.~~interest. BlackRock earns an investment advisory fee for the service of managing these assets on behalf of its clients.

⁽²⁾	Amounts represent the portion of assets and liabilities of ~~Consolidated Sponsored Investment Funds~~CIPs attributable to NCI.

⁽³⁾	Amounts include property and equipment and other assets.

⁽⁴⁾	~~Amount includes~~Amounts include approximately ~~$5.6~~$4.4 billion of deferred income tax liabilities related to goodwill and intangibles.

The following discussion summarizes the significant changes in assets and liabilities on a GAAP basis. Please see the condensed consolidated statements of financial condition as of September 30, ~~2017~~2021 and December 31, ~~2016~~2020 contained in Part I, Item 1 of this filing. The discussion does not include changes related to assets and liabilities that are equal and offsetting and have no impact on BlackRock’s stockholders’ equity.

Assets. Cash and cash equivalents at September 30, ~~2017~~2021 and December 31, ~~2016~~2020 included ~~$73~~$265 million and ~~$53~~$206 million, respectively, of cash held by ~~consolidated VREs~~CIPs (see Liquidity and Capital Resources for details on the change in cash and cash equivalents during the nine months ended September 30, ~~2017)~~2021).

Accounts receivable at September 30, ~~2017~~2021 increased ~~$833~~$480 million from December 31, ~~2016~~2020, primarily due to higher base and performance fee receivables. Investments, including the impact of CIPs, increased $182 million from December 31, 2020 (for more information see Investments herein). Goodwill and intangible assets increased $1,022 million from December 31, 2020, primarily due to the Aperio Transaction, partially offset by amortization of intangible assets. Operating lease right-of-use (“ROU”) assets at September 30, 2021 increased $1.1 billion from December 31, 2020 (substantially offset by an increase in operating lease liabilities), primarily related to the previously described lease of office space for the Company’s future headquarters located at 50 Hudson Yards in New York. While the Company expects to begin to occupy the new office space in late 2022 (and begin cash lease payments in May 2023), the Company is required to record an operating ROU asset and related operating lease liability from August 2021 because it obtained access to the building to begin its tenant improvements. Other assets (including property and equipment) increased $1,433 million from December 31, 2020, primarily due to an increase in unit trust receivables (substantially offset by an increase in unit trust payables recorded within ~~accounts payable and accrued~~other liabilities) ~~and higher BlackRock mutual funds,~~ ~~iShares~~ ~~ETFs and performance fee receivables. Investments were $1,928 million at September 30, 2017 (for more information see~~ ~~Investments~~ ~~herein). Goodwill and intangible assets increased $145 million from December 31, 2016, primarily due to the First Reserve Transaction and Cachematrix Transaction, partially offset by~~ ~~$77 million of amortization of intangible assets.~~ ~~Other assets (including property and equipment) increased $258 million from December 31, 2016, primarily related to~~, an increase in current taxes receivable ~~certain~~and an increase in strategic ~~investments and other assets.~~minority investments.

Liabilities. Accrued compensation and benefits at September 30, ~~2017~~2021 decreased ~~$266~~$156 million from December 31, ~~2016,~~2020, primarily due to ~~2016~~2020 incentive compensation cash payments in the first quarter of ~~2017,~~2021, partially offset by ~~2017~~2021 incentive compensation accruals. Accounts payable and accrued liabilities at September 30, ~~2017~~2021 increased ~~$558~~$374 million from December 31, ~~2016~~2020, primarily due to increased accruals. Operating lease liabilities at September 30, 2021 increased $1,191 million from December 31, 2020 (substantially offset by an increase in ROU assets), primarily related to the lease of office space for the Company’s future headquarters described above. Other liabilities increased $1,648 million from December 31, 2020, primarily due to higher unit trust payables (substantially offset by an increase in unit trust receivables recorded within ~~accounts receivable).~~

other assets) and higher other liabilities of CIPs, including deferred carried interest liabilities. Net deferred income tax liabilities at September 30, ~~2017 increased $126~~2021 decreased $14 million ~~partially~~from December 31, 2020, primarily due to the effects of temporary differences associated with ~~stock-based compensation and intangibles. The change also reflects~~capitalized costs, partially offset by the Aperio Transaction, revaluation of certain deferred income tax liabilities ~~as a result of domestic state~~due to tax legislation enacted in the UK and local tax changes. Other liabilities increased $223 million from December 31, 2016, primarily related to an increase in contingent liabilities related to the First Reserve Transaction, uncertain tax positions, and other operating liabilities.investment income.

Investments ~~and Investments of Consolidated VIEs~~

The Company’s investments ~~and investments of consolidated VIEs (collectively, “Total Investments”)~~ were ~~$1,928~~$7,101 million and ~~$1,286~~$6,919 million ~~respectively,~~ at September 30, ~~2017. Total~~2021 and December 31, 2020, respectively. Investments include consolidated investments held by ~~sponsored investment funds~~CIPs accounted for as VREs and VIEs. Management reviews BlackRock’s ~~Total Investments~~investments on an “economic” basis, which eliminates the portion of ~~Total Investments~~investments that does not impact BlackRock’s book value or net income attributable to BlackRock. 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.

The Company presents ~~Total Investments,~~investments, as adjusted, to enable investors to understand the portion of ~~Total Investments~~investments that is owned by the Company, net of NCI, as a gauge to measure the impact of changes in net nonoperating income (expense) on investments to net income (loss) attributable to BlackRock.

The Company further presents net “economic” investment exposure, net of ~~deferred compensation investments and~~ hedged investments, to reflect another helpful measure for investors. ~~The economic impact of Total Investments held pursuant to deferred compensation arrangements is offset by a change in compensation expense.~~ The impact of certain investments is substantially mitigated by swap hedges. Carried interest capital allocations are excluded as there is no impact to BlackRock’s stockholders’ equity until such amounts are realized as performance fees. Finally, the Company’s regulatory investment in Federal Reserve Bank stock, which is not subject to market or interest rate risk, is excluded from the Company’s net economic investment exposure.

September 30,

December 31,

(in millions)

2017

2016

Investments, GAAP

$
1,928

$
1,595

Investments held by consolidated VIEs, GAAP

1,286

1,008

Total Investments

3,214

2,603

Investments held by consolidated VIEs

(1,286
)

(1,008
)
Investments held by consolidated VREs

(507
)

(465
)
Net interest in consolidated VREs

479

444

Net interest in consolidated VIEs⁽¹⁾

1,048

840

Total Investments, as adjusted

2,948

2,414

Federal Reserve Bank stock

(90
)

(89
)
Deferred compensation investments

(58
)

(66
)
Hedged investments

(538
)

(614
)
Carried interest (VIEs/VREs)

(280
)

(126
)
Total “economic” investment exposure

$
1,982

$
1,519

	September 30,			December 31,
(in millions)	2021			2020
Investments, GAAP	$	7,101		$	6,919
Investments held by CIPs		(4,574	)		(4,976	)
Net interest in CIPs⁽¹⁾		3,025			2,490
Investments, as adjusted		5,552			4,433
Federal Reserve Bank stock		(95	)		(94	)
Deferred compensation investments		—			(6	)
Hedged investments		(801	)		(833	)
Carried interest		(1,446	)		(627	)
Total “economic” investment exposure⁽²⁾	$	3,210		$	2,873

⁽¹⁾	~~Amount includes $260 million of~~Amounts include carried interest (VIEs) as of $1.4 billion and $604 million at September 30, ~~2017~~2021 and ~~$108 million as of~~ December 31, ~~2016,~~2020, respectively, which has no impact on the Company’s “economic” investment exposure.

⁽²⁾	Amounts exclude corporate minority investments included in other assets on the condensed consolidated statements of financial condition.

The following table represents the carrying value of the Company’s economic investment exposure, by asset type, at September 30, ~~2017~~2021 and December 31, ~~2016:~~2020:

	September 30,		December 31,		September 30,		December 31,
(in millions)	2017		2016		2021		2020
Equity⁽¹⁾					$	1,051	$	835
Fixed income⁽²⁾						758		958
Multi-asset⁽³⁾						80		127
Alternatives:						—
Private equity	$	333	$	334		746		418
Real assets		304		94		256		251
Other alternatives⁽¹⁾		254		245
Other investments⁽²⁾		1,091		846
Other alternatives⁽⁴⁾						319		284
Alternatives subtotal						1,321		953
Total “economic” investment exposure	$	1,982	$	1,519	$	3,210	$	2,873

⁽¹⁾	~~Other alternatives include distressed credit/mortgage~~Equity includes unhedged seed investments in equity mutual funds/~~opportunistic funds~~strategies and ~~hedge funds/funds of hedge funds.~~equity securities.

⁽²⁾	~~Other investments primarily include~~Fixed income includes unhedged seed investments in fixed income ~~equity and multi-asset~~ mutual funds/strategies, ~~as well as U.K.~~bank loans and UK government securities, primarily held for regulatory purposes.

⁽³⁾	Multi-asset includes unhedged seed investments in multi-asset mutual funds/strategies.

⁽⁴⁾	Other alternatives include direct hedge fund strategies and hedge fund solutions.

As adjusted investment activity for the nine months ended September 30, ~~2017~~2021 was as follows:

(in millions)				Nine Months Ended September 30, 2021
Total Investments, as adjusted, December 31, 2016	$	2,414
Investments, as adjusted, beginning balance				$	4,433
Purchases/capital contributions		830			1,096
Sales/maturities		(603	)		(970	)
Distributions⁽¹⁾		(67	)		(147	)
Market appreciation(depreciation)/earnings from equity method investments		183			376
Carried interest capital allocations/(distributions)/acquired		154
Carried interest capital allocations/(distributions)					819
Other(2)		37			(55	)
Total Investments, as adjusted, September 30, 2017	$	2,948
Investments, as adjusted, ending balance				$	5,552

⁽¹⁾

⁽¹⁾ Amount includes distributions representing return of capital and return on investments.

⁽²⁾ Amount includes the impact of foreign exchange movements.

~~Amount includes distributions representing return of capital and return on investments.~~

LIQUIDITY AND CAPITAL RESOURCES

BlackRock Cash Flows Excluding the Impact of ~~Consolidated Sponsored Investment Funds~~CIPs

The condensed consolidated statements of cash flows include the cash flows of the ~~Consolidated Sponsored Investment Funds.~~CIPs. The Company uses an adjusted cash flow statement, which excludes the impact of ~~Consolidated Sponsored Investment Funds,~~CIPs, as a supplemental non-GAAP measure to assess liquidity and capital requirements. The Company believes that its cash flows, excluding the impact of the ~~Consolidated Sponsored Investment Funds,~~CIPs, provide investors with useful information on the cash flows of BlackRock relating to its ability to fund additional operating, investing and financing activities. BlackRock’s management does not advocate that investors consider such non-GAAP measures in isolation from, or as a substitute for, its cash flows presented in accordance with GAAP.

The following table presents a reconciliation of the condensed consolidated statements of cash flows presented on a GAAP basis to the condensed consolidated statements of cash flows, excluding the impact of the cash flows of ~~Consolidated Sponsored Investment Funds:~~CIPs:

(in millions)

GAAP
Basis

Impact on
Cash Flows
of Consolidated
Sponsored Investment Funds

Cash Flows
Excluding
Impact of
Consolidated
Sponsored Investment Funds

Cash and cash equivalents, December 31, 2016

$
6,091

$
53

$
6,038

Cash flows from operating activities

2,486

(252
)

2,738

Cash flows from investing activities

(490
)

(52
)

(438
)
Cash flows from financing activities

(2,083
)

324

(2,407
)
Effect of exchange rate changes on cash and cash
equivalents

161

—

161

Net change in cash and cash equivalents

74

20

54

Cash and cash equivalents, September 30, 2017

$
6,165

$
73

$
6,092

(in millions)	GAAP Basis			Impact on Cash Flows of CIPs			Cash Flows Excluding Impact of CIPs
Cash, cash equivalents and restricted cash, December 31, 2020	$	8,681		$	206		$	8,475
Net cash provided by/(used in) operating activities		3,027			(963	)		3,990
Net cash provided by/(used in) investing activities		(1,579	)		(59	)		(1,520	)
Net cash provided by/(used in) financing activities		(2,695	)		1,081			(3,776	)
Effect of exchange rate changes on cash, cash equivalents and restricted cash		(56	)		—			(56	)
Net increase/(decrease) in cash, cash equivalents and restricted cash		(1,303	)		59			(1,362	)
Cash, cash equivalents and restricted cash, September 30, 2021	$	7,378		$	265		$	7,113

Sources of BlackRock’s operating cash primarily include ~~investment advisory, administration~~base fees and securities lending revenue, performance fees, ~~revenue from~~ technology ~~and risk management~~ services revenue, advisory and other revenue and distribution fees. BlackRock uses its cash to pay all operating ~~expense,~~expenses, interest and principal on borrowings, income taxes, dividends on BlackRock’s capital stock, repurchases of the Company’s stock, acquisitions, capital expenditures and purchases of co-investments and seed investments.

For details of the Company’s GAAP cash flows from operating, investing and financing activities, see the ~~Condensed Consolidated Statements~~condensed consolidated statements of ~~Cash Flows~~cash flows contained in Part I, Item 1 of this filing.

Cash flows ~~from~~provided by/(used in) operating activities, excluding the impact of ~~Consolidated Sponsored Investment Funds,~~CIPs, primarily include the receipt of ~~investment advisory and administration~~base fees, securities lending revenue and performance fees offset by the payment of operating expenses incurred in the normal course of business, including year-end incentive compensation accrued for in the prior year.

Cash ~~outflows from~~flows used in investing activities, excluding the impact ~~of Consolidated Sponsored Investment Funds,~~CIPs, for the nine months ended September 30, ~~2017~~2021 were ~~$438 million~~$1.5 billion and primarily reflected ~~$404~~$1.1 billion of cash outflows related to the Aperio Transaction, $285 million of net investment purchases ~~$100~~and $215 million of purchases of property and equipment, ~~$73 million related to the First Reserve Transaction and $29 million related to the Cachematrix Transaction,~~ partially offset by ~~$142~~$77 million of ~~net proceeds~~distributions of capital from ~~sales and maturities of certain investments.~~equity method investees.

Cash ~~outflows from~~flows used in financing activities, excluding the impact of ~~Consolidated Sponsored Investment Funds,~~CIPs, for the nine months ended September 30, ~~2017~~2021 were ~~$2,407 million,~~$3.8 billion, primarily resulting from ~~$1,133 million~~$1.9 billion of cash dividend payments and $1.2 billion of share repurchases, including ~~$825~~$900 million in open market transactions and ~~$308~~$282 million of employee tax withholdings related to employee stock transactions, ~~$1,259 million of cash dividend payments~~ and ~~$700~~$750 million of repayments of long-term ~~borrowings, partially offset by $697 million of proceeds from issuance of long-term~~ borrowings.

The Company manages its financial condition and funding to maintain appropriate liquidity for the business. Liquidity resources at September 30, ~~2017~~2021 and December 31, ~~2016~~2020 were as follows:

	September 30,			December 31,			September 30,			December 31,
(in millions)	2017			2016			2021			2020
Cash and cash equivalents⁽¹⁾	$	6,165		$	6,091		$	7,361		$	8,664
Cash and cash equivalents held by consolidated VREs⁽²⁾		(73	)		(53	)
Cash and cash equivalents held by CIPs⁽²⁾								(265	)		(206	)
Subtotal		6,092			6,038			7,096			8,458
Credit facility – undrawn		4,000			4,000			4,400			4,000
Total liquidity resources⁽³⁾	$	10,092		$	10,038		$	11,496		$	12,458

⁽¹⁾

The percentage of cash and cash equivalents held by the Company’s ~~U.S.~~US subsidiaries was approximately ~~40%~~50% and ~~50%~~55% at September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively. See Net Capital Requirements herein for more information on net capital requirements in certain regulated subsidiaries.

⁽²⁾	The Company cannot readily access such cash and cash equivalents to use in its operating activities.

~~(3)~~

~~Amount at December 31, 2016 does not reflect year-end incentive compensation accruals of approximately $1.3 billion, which were paid in the first quarter of 2017.~~

Total liquidity resources ~~increased $54~~decreased $962 million during the nine months ended September 30, ~~2017,~~2021, primarily reflecting cash ~~flows from operating activities,~~payments of 2020 year-end incentive awards, cash dividend payments of $1.9 billion, share repurchases of $1.2 billion, approximately $1.1 billion of cash outflow related to the Aperio Transaction and repayments of borrowings of $750 million, partially offset by cash ~~payments~~flows from other operating activities and a $400 million increase in the aggregate commitment amount of ~~2016 year-end incentive awards, share repurchases of $1,133 million and cash dividend payments of $1,259 million.~~ the credit facility.

A significant portion of the Company’s ~~$2,948~~$5,552 million of ~~Total Investments,~~investments, as adjusted, is illiquid in nature and, as such, cannot be readily convertible to cash.

Share Repurchases. ~~In January 2017,~~ During the ~~Board of Directors approved an increase in~~nine months ended September 30, 2021, the Company repurchased 1.1 million common shares ~~that may be repurchased~~ under the Company’s existing share repurchase program ~~to allow for the repurchase of an additional 6 million shares for a total up to 9 million shares of BlackRock common stock.~~

~~The Company repurchased 2.1 million common shares in open market transactions under the share repurchase program~~ for approximately ~~$825 million during the nine months ended September 30, 2017.~~$900 million. At September 30, ~~2017,~~2021, there were ~~6.9~~3.9 million shares still authorized to be ~~repurchased.~~repurchased under the program.

Net Capital Requirements. The Company is required to maintain net capital in certain regulated subsidiaries within a number of jurisdictions, which is partially maintained by retaining cash and cash equivalent investments in those subsidiaries or jurisdictions. As a result, such subsidiaries of the Company may be restricted in their ability to transfer cash between different jurisdictions and to their parents. Additionally, transfers of cash between international jurisdictions ~~including repatriation to the United States,~~ may have adverse tax consequences that could discourage such transfers.

BlackRock Institutional Trust Company, N.A. (“BTC”) is chartered as a national bank that does not accept ~~client~~ deposits or make commercial loans and whose powers are limited to trust and other fiduciary activities. BTC provides investment management and other fiduciary services, including investment advisory and securities lending agency services, to institutional clients. BTC is subject to regulatory capital and liquid asset requirements administered by the US Office of the Comptroller of the Currency.

At September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, the Company was required to maintain approximately ~~$1.7~~$2.4 billion and ~~$1.4~~$2.2 billion, respectively, in net capital in certain regulated subsidiaries, including BTC, entities regulated by the Financial Conduct Authority and Prudential Regulation Authority in the ~~United Kingdom,~~UK, and the Company’s broker-dealers. The Company was in compliance with all applicable regulatory net capital requirements.

Short-Term Borrowings

~~2017~~2021 Revolving Credit Facility. ~~The~~ In March 2021, the Company’s credit facility ~~has an~~was amended to increase the aggregate commitment amount ~~of $4.0~~to $4.4 billion and ~~was amended in April 2017~~ to extend the maturity date to ~~April 2022~~March 2026 (the ~~“2017~~“2021 credit facility”). In addition, the amendment incorporated certain sustainability-linked pricing metrics into the agreement. Specifically, the Company’s applicable interest rate and commitment fee are subject to upward or downward adjustments on an annual basis if the Company achieves, or fails to achieve, certain specified targets. Interest on borrowings outstanding accrues at a rate based on the applicable London Interbank Offered Rate, or an applicable replacement benchmark, plus a spread. The ~~2017~~2021 credit facility permits the Company to request up to an additional $1.0 billion of borrowing capacity, subject to lender credit approval, increasing the overall size of the ~~2017~~2021 credit facility to an aggregate principal amount not to exceed ~~$5.0~~$5.4 billion. ~~Interest on borrowings outstanding accrues at a rate based on the applicable London Interbank Offered Rate plus a spread.~~ The ~~2017~~2021 credit facility requires the Company not to exceed a maximum leverage ratio (ratio of net debt to earnings before interest, taxes, depreciation and amortization, where net debt equals total debt less unrestricted cash) of 3 to 1, which was satisfied with a ratio of less than 1 to 1 at September 30, ~~2017.~~2021. The ~~2017~~2021 credit facility provides back-up liquidity to fund ongoing working capital for general corporate purposes and various investment opportunities. At September 30, ~~2017,~~2021, the Company had no amount outstanding under the ~~2017~~2021 credit facility.

Long-Term Borrowings

At September 30, ~~2017,~~2021, the principal amount of long-term borrowings outstanding was ~~$5.0~~$6.5 billion. See Note ~~12,~~ 15, Borrowings, in the ~~2016~~2020 Form 10-K for more information on borrowings outstanding as of December 31, ~~2016.~~

In March 2017, the Company issued $700 million in aggregate principal amount of 3.20% senior unsecured and unsubordinated notes maturing on March 15, 2027 (the “2027 Notes”). Interest is payable semi-annually on March 15 and September 15 of each year, commencing September 15, 2017, and is approximately $22 million per year. The 2027 Notes may be redeemed prior to maturity at any time in whole or in part at the option of the Company at a “make-whole” redemption price. The unamortized discount and debt issuance costs are being amortized over the remaining term of the 2027 Notes.

~~In April 2017, the net proceeds of the 2027 Notes were used to fully repay $700 million in aggregate principal amount outstanding of 6.25% notes prior to their maturity in September 2017.~~2020.

During the nine months ended September 30, ~~2017,~~2021, the Company paid approximately ~~$149~~$148 million of interest on long-term borrowings. Future principal repayments and interest requirements at September 30, ~~2017~~2021 were as follows:

(in millions)
Year	Principal		Interest		Total Payments		Principal		Interest		Total Payments
Remainder of 2017	$	—	$	54	$	54
2018		—		175		175
2019		1,000		175		1,175
2020		—		125		125
2021		750		109		859
Remainder of 2021							$	—	$	41	$	41
2022		750		80		830		750		161		911
2023								—		148		148
2024								1,000		131		1,131
2025⁽¹⁾								811		113		924
2026								—		103		103
Thereafter⁽¹⁾		2,528		184		2,712		3,950		283		4,233
Total	$	5,028	$	902	$	5,930	$	6,511	$	980	$	7,491

__________________________

⁽¹⁽¹⁾⁾

The amount of principal and interest payments for the 2025 Notes (issued in Euros) represents the expected payment amounts using the EUR/USD foreign exchange ~~rates~~rate as of September 30, ~~2017.~~2021.

In May 2021, the Company fully repaid $750 million of 4.25% notes at maturity.

Commitments and Contingencies

~~Lease Commitment.~~ ~~In May 2017, the Company entered into an agreement with 50 HYMC Owner LLC, for the lease of approximately 847,000 square feet of office space located at 50 Hudson Yards, New York, New York.~~ ~~The term of the lease is twenty years from the date that rental payments begin, expected to occur in May 2023, with the option to renew for a specified term.~~

~~Future minimum commitments of annual base rental payments under this operating lease are as follows:~~

(in millions)

Year
Amount

2023
$
34

2024

51

2025

51

2026

51

2027

51

Thereafter

1,007

Total
$
1,245

Contingent Payments Related to Business Acquisitions. In connection with certain acquisitions, BlackRock is required to make contingent payments, subject to achieving specified performance targets, which may include revenue ~~related to~~from acquired ~~contracts or new capital commitments for certain products.~~ contracts. The fair value of the remaining aggregate contingent payments at September 30, ~~2017~~2021 totaled ~~$228~~$62 million ~~including $125 million related to the First Reserve Transaction,~~ and is included in other liabilities on the condensed consolidated statements of financial condition.

Carried Interest Clawback. As a general partner in certain investment ~~funds,~~products, including private equity partnerships and certain hedge funds, the Company may receive carried interest cash distributions from the partnerships in accordance with distribution provisions of the partnership agreements. The Company may, from time to time, be required to return all or a portion of such distributions to the limited partners in the event the limited partners do not achieve a return as specified in the various partnership agreements. Therefore, BlackRock records carried interest subject to such clawback provisions in ~~Total Investments,~~investments, or ~~cash/~~cash ~~of consolidated VIEs~~and cash equivalents to the extent that it is distributed, and as a deferred carried interest ~~liability/other liabilities of consolidated VIEs~~liability on its condensed consolidated statements of financial condition. Carried interest is recorded as performance fees on BlackRock’s condensed consolidated statements of income ~~upon the earlier~~when fees are no longer probable of ~~the termination of the investment fund or when the likelihood of clawback is considered mathematically improbable.~~significant reversal.

Indemnifications. On behalf of certain clients, the Company lends securities to highly rated banks and broker-dealers. In these securities lending transactions, the borrower is required to provide and maintain collateral at or above regulatory minimums. Securities on loan are marked to market daily to determine if the borrower is required to pledge additional collateral. BlackRock has ~~issued certain indemnifications~~agreed to indemnify certain securities lending clients against potential loss resulting from a borrower’s failure to fulfill its obligations under the securities lending agreement should the value of the collateral pledged by the borrower at the time of default be insufficient to cover the borrower’s obligation under the securities lending agreement. AtThe amount of securities on loan as of September 30, ~~2017,~~2021 and subject to this type of indemnification was $279 billion. In the ~~Company indemnified certain of its clients for their securities~~Company’s capacity as lending ~~loan balances of approximately $197.6 billion. The Company held, as~~ agent, cash and securities totaling ~~$210.6~~$299 billion were held as collateral for indemnified securities on loan at September 30, ~~2017.~~2021. The fair value of these indemnifications was not material at September 30, ~~2017.~~2021.

While the collateral pledged by a borrower is intended to be sufficient to offset the borrower’s obligations to return securities borrowed and any other amounts owing to the lender under the relevant securities lending agreement, in the event of a borrower default, the Company can give no assurance that the collateral pledged by the borrower will be sufficient to fulfill such obligations. If the amount of such pledged collateral is not sufficient to fulfill such obligations to a client for whom the Company has provided indemnification, BlackRock would be responsible for the amount of the shortfall. These indemnifications cover only the collateral shortfall described above, and do not in any way guarantee, assume or otherwise insure the investment performance or return of any cash collateral vehicle into which securities lending cash collateral is invested.

Critical Accounting Policies

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expense during the reporting periods. Actual results could differ significantly from those estimates. Management considers the following critical accounting policies important to understanding the condensed consolidated financial statements. For a summary of these and additional accounting policies see Note 2, Significant Accounting Policies, in the notes to the condensed consolidated financial ~~statements contained in Part I, Item 1 of this filing and~~ statements. In addition, see Critical Accounting Policies in Management’s Discussion and Analysis of Financial Condition and Results of Operations ~~in the 2016 Form 10-K~~ and Note 2, Significant Accounting Policies, in the ~~2016~~2020 Form 10-K for further information.

Consolidation. In the normal course of business, the Company is the manager of various types of sponsored investment vehicles. The Company performs an analysis for investment products to determine if the product is a VIE or a VRE. Assessing whether an entity is a VIE or a VRE involves judgment and analysis. Factors considered in this assessment include the entity’s legal organization, the entity’s capital structure and equity ownership, and any related party or de facto agent implications of the Company’s involvement with the entity. Investments that are determined to be VREs are consolidated if the Company can exert control over the financial and operating policies of the investee, which generally exists if there is greater than 50% voting interest. ~~See Note 4,~~ ~~Consolidated Voting Rights Entities, in the notes to the condensed consolidated financial statements for more information.~~ Investments that are determined to be VIEs are consolidated if the Company is the primary beneficiary (“PB”) of the entity.

~~At September 30, 2017,~~ BlackRock ~~was determined to be the PB for certain investment funds that were determined to be VIEs, which required BlackRock to consolidate them. BlackRock was~~is deemed to be the PB ~~because~~of a VIE if it has the power to direct the activities that most significantly impact the entities’ economic performance and has the obligation to absorb losses or the right to receive benefits that potentially could be significant to the VIE. The Company generally consolidates VIEs in which it holds an ~~equity ownership~~economic interest of 10% or greater and deconsolidates such VIEs once equity ownership falls below 10%. See Note 5, ~~Variable Interest Entities~~6, Consolidated Sponsored Investment Products, in the notes to the condensed consolidated financial statements for more information.

In addition to sponsored investment products, the Company consolidates an affiliated entity, which it deems to be a VRE, because it can exert control over its financial and operating policies, based on the Company’s 50.1% ownership and voting rights.

Fair Value Measurements. The Company’s assessment of the significance of a particular input to the fair value measurement according to the fair value hierarchy (i.e., Level 1, 2 and 3 inputs, as defined) in its entirety requires judgment and considers factors specific to the financial instrument. See Note 2, Significant Accounting Policies, in the notes to the condensed consolidated financial statements for more information on fair value measurements.

Investment Advisory Performance Fees / Carried Interest. The Company receives investment advisory performance fees, orincluding incentive allocations (carried interest) from certain actively managed investment funds and certain ~~separately managed accounts.~~SMAs. These performance fees are dependent upon exceeding specified relative or absolute investment return ~~thresholds. Such fees are recorded upon completion of the measurement period,~~thresholds, which ~~varies~~may vary by product or account, and ~~could be~~include monthly, quarterly, ~~annually~~annual or ~~longer.~~longer measurement periods.

Performance fees, including carried interest, are recognized when it is determined that they are no longer probable of significant reversal (such as upon the sale of a fund’s investment or when the amount of AUM becomes known as of the end of a specified measurement period). Given the unique nature of each fee arrangement, contracts with customers are evaluated on an individual basis to determine the timing of revenue recognition. Significant judgement is involved in making such determination. Performance fees typically arise from investment management services that began in prior reporting periods. Consequently, a portion of the fees the Company recognizes may be partially related to the services performed in prior periods that meet the recognition criteria in the current period. At each reporting date, the Company considers various factors in estimating performance fees to be recognized, including carried interest. These factors include but are not limited to whether: (1) the fees are dependent on the market and thus are highly susceptible to factors outside the Company’s influence; (2) the fees have a large number and a broad range of possible amounts; and (3) the funds or SMAs have the ability to invest or reinvest their sales proceeds.

~~In addition, the~~The Company is allocated carried interest from certain alternative investment products upon exceeding performance thresholds. ~~BlackRock~~The Company may be required to reverse/return all, or part, of such carried interest ~~allocations~~allocations/distributions depending upon future performance of these ~~funds. Therefore, BlackRock records carried~~products. Carried interest subject to such clawback provisions is recorded in ~~Total Investments,~~investments or ~~cash/~~cash ~~of consolidated VIEs~~and cash equivalents to the extent that it is distributed, on its condensed consolidated statements of financial condition. ~~Carried interest is recorded as performance fee revenue upon the earlier of the termination of the investment fund or when the likelihood of clawback is considered mathematically improbable.~~

The Company records a liability for deferred carried interest ~~liability~~ to the extent it receives cash or capital allocations related to carried interest prior to meeting the revenue recognition criteria. At September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, the Company had ~~$303 million~~$1.3 billion and ~~$152~~$584 million, respectively, of deferred carried interest recorded in other ~~liabilities/other~~ liabilities ~~of consolidated VIEs~~ on the condensed consolidated statements of financial condition. A portion of the deferred carried interest ~~liability will~~may also be paid to certain employees. The ultimate timing of the recognition of performance fee revenue and related compensation expense, if any, for these products is unknown.

~~The following table presents~~ SeeNote 16, Revenue, in the notes to the condensed consolidated financial statements for detailed changes in the deferred carried interest liability ~~(including the portion related to consolidated VIEs)~~balance for the three and nine months ended September 30, ~~2017~~2021 and ~~2016:~~2020.

Three Months Ended

Nine Months Ended

September 30,

September 30,

(in millions)

2017

2016

2017

2016

Beginning balance

$
280

$
131

$
152

$
143

Net increase (decrease) in unrealized allocations

23

8

52

7

Performance fee revenue recognized

—

(11
)

(12
)

(22
)
Acquisition

—

—

111

—

Ending balance

$
303

$
128

$
303

$
128

~~Accounting Developments~~

~~Recent Accounting Pronouncements Not Yet Adopted.~~

~~Revenue from Contracts with Customers.~~ ~~In May 2014, the FASB issued ASU 2014-09,~~ ~~Revenue from Contracts with Customers~~ (“ASU 2014-09”). ASU 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The guidance also changes the accounting for certain contract costs and revises the criteria for determining if an entity is acting as a principal or agent in certain arrangements. The Company continues to evaluate the impact of ASU 2014-09 on the presentation and recognition of its revenue contracts and certain contract costs. The most significant change identified to date relates to the presentation of certain distribution costs, which are currently presented net against revenues (contra-revenue) and will likely be presented as an expense on a gross basis. The Company currently expects such net gross up to annual revenue to be approximately $1 billion with a corresponding gross up to annual expense. Consequently, the Company expects its GAAP operating margin to decline upon adoption of the new guidance due to the gross up of revenue. However, it currently does not expect any material impact to its as adjusted operating margin. The Company is currently evaluating which transition method it will apply when it adopts the new revenue recognition guidance in the first quarter of 2018.

~~For accounting pronouncements that the Company adopted during the nine months ended September 30, 2017 and for additional recent accounting pronouncements not yet adopted, see Note 2,~~ ~~Significant Accounting Policies, in the condensed consolidated financial statements contained in Part I, Items 1 of this filing.~~

Item 3. Quantitative and Qualitative Disclosures About Market Risk

AUM Market Price Risk.BlackRock’s investment advisory and administration fees (collectively “base fees”) are primarily comprised of fees based on a percentage of the value of ~~AUM~~assets under management (“AUM”) and, in some cases, performance fees expressed as a percentage of the returns realized on AUM. At September 30, ~~2017,~~2021, the majority of the Company’s ~~investment advisory and administration~~base fees were based on average or period end AUM of the applicable investment funds or separate accounts. Movements in equity market prices, interest rates/credit spreads, foreign exchange rates or all three could cause the value of AUM to decline, which would result in lower ~~investment advisory and administration~~base fees.

Corporate Investments Portfolio Risks. As a leading investment management firm, BlackRock devotes significant resources across all of its operations to identifying, measuring, monitoring, managing and analyzing market and operating risks, including the management and oversight of its own investment portfolio. The Board of Directors of the Company has adopted guidelines for the review of investments to be made by the Company, requiring, among other things, that investments be reviewed by certain senior officers of the Company, and that certain investments may be referred to the Audit Committee or the Board of Directors, depending on the circumstances, for approval.

In the normal course of its business, BlackRock is exposed to equity market price risk, interest rate/credit spread risk and foreign exchange rate risk associated with its corporate investments.

BlackRock has investments primarily in sponsored investment products that invest in a variety of asset classes, including real assets, private equity and hedge funds. Investments generally are made for co-investment purposes, to establish a performance track record ~~to hedge exposure to certain deferred compensation plans~~ or for regulatory purposes. Currently, the Company has a seed capital hedging program in which it enters into swaps to hedge market and interest rate exposure to certain investments. At September 30, ~~2017,~~2021, the Company had outstanding total return swaps with an aggregate notional value of approximately ~~$538~~$801 million. ~~At September 30, 2017, there were no outstanding interest rate swaps.~~

At September 30, ~~2017,~~2021, approximately ~~$1.8~~$4.6 billion of BlackRock’s ~~Total Investments~~investments were maintained in consolidated sponsored investment ~~funds~~products accounted for as ~~VREs~~variable interest entities and ~~VIEs.~~voting rights entities. Excluding the impact of the Federal Reserve Bank stock, carried interest ~~investments made to hedge exposure to certain deferred compensation plans~~ and certain investments that are hedged via the seed capital hedging program, the Company’s economic exposure to its investment portfolio is ~~$1,982 million.~~$3.2 billion. See ~~Balance Sheet Overview- Investments and Investments~~Statement of ~~Consolidated VIEs~~ Financial Condition Overview-Investments in Management’s Discussion and Analysis of Financial Condition and Results of Operations for further information on the Company’s ~~Total Investments.~~investments.

Equity Market Price Risk.At September 30, ~~2017,~~2021, the Company’s net exposure to equity market price risk in its investment portfolio was approximately ~~$816~~$1,582 million of the Company’s total economic investment exposure. Investments subject to market price risk include private equity and real assets investments, hedge funds and funds of funds as well as mutual funds. The Company estimates that a hypothetical 10% adverse change in market prices would result in a decrease of approximately ~~$81.6~~$158 million in the carrying value of such investments.

Interest Rate/Credit Spread Risk. At September 30, ~~2017,~~2021, the Company was exposed to interest-rate risk and credit spread risk as a result of approximately ~~$1,166~~$1,628 million of ~~Total Investments~~investments in debt securities and sponsored investment products that invest primarily in debt securities. Management considered a hypothetical 100 basis point fluctuation in interest rates or credit spreads and estimates that the impact of such a fluctuation on these investments, in the aggregate, would result in a decrease, or increase, of approximately ~~$20.3~~$29 million in the carrying value of such investments.

Foreign Exchange Rate Risk.As discussed above, the Company invests in sponsored investment products that invest in a variety of asset classes. The carrying value of the total economic investment exposure denominated in foreign currencies, primarily the British pound and Euro, was ~~$404~~$912 million at September 30, ~~2017.~~2021. A 10% adverse change in the applicable foreign exchange rates would result in approximately a ~~$40.4~~$91 million decline in the carrying value of such investments.

Other Market Risks. The Company executes forward foreign currency exchange contracts to mitigate the risk of certain foreign exchange risk movements. At September 30, ~~2017,~~2021, the Company had outstanding forward foreign currency exchange contracts with an aggregate notional value of approximately ~~$1.3~~$2.2 billion.

Item 4. Controls and Procedures

Disclosure Controls and Procedures. Under the direction of BlackRock’s Chief Executive Officer and Chief Financial Officer, BlackRock evaluated the effectiveness of its disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this quarterly report on Form 10-Q. Based on this evaluation, BlackRock’s Chief Executive Officer and Chief Financial Officer have concluded that BlackRock’s disclosure controls and procedures were effective.

Internal Control over Financial Reporting. There were no changes in our internal control over financial reporting that occurred during the quarter ended September 30, ~~2017~~2021 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting. In addition, there was no material impact to our internal control over financial reporting while a majority of our employees are working remotely due to the COVID-19 pandemic. The Company is continually monitoring and assessing the COVID-19 situation to determine any potential impact on the design and operating effectiveness of our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

For a discussion of the Company’s legal proceedings, see Note 15, Commitments and Contingencies, in the notes to the condensed consolidated financial statements of this Form 10-Q.

Item 1A. Risk Factors

~~From time~~The following discussion supplements the discussion of risk factors previously disclosed in BlackRock’s Annual Report on Form 10-K for the year ended December 31, 2020:

RISKS RELATED TO THE COVID-19 Pandemic

The COVID-19 pandemic may adversely affect BlackRock’s business, operations and financial condition which may cause its AUM, revenue and earnings to time, BlackRock receives subpoenas or other requests for information from various U.S. federal, state governmental and domestic and international regulatory authorities in connection with certain industry-wide or other investigations or proceedings. It is BlackRock’s policy to cooperate fully with such inquiries. The Company and certain of its subsidiaries have been named as defendants in various legal actions, including arbitrations and other litigation arising in connection with BlackRock’s activities. Additionally, BlackRock advised investment portfolios may be subject to lawsuits, any of which potentially could harmdecline.

Towards the ~~investment returns~~end of the ~~applicable portfolio or result in~~first quarter of 2020, the ~~Company being liable~~pandemic began to impact BlackRock’s business. While global markets have significantly recovered since then, the ~~portfolios for any resulting damages.~~

On May 27, 2014, certain purported investors in the BlackRock Global Allocation Fund, Inc. and the BlackRock Equity Dividend Fund (collectively, the “Funds”) filed a consolidated complaint (the “Consolidated Complaint”) in the U.S. District Court for the District of New Jersey against BlackRock Advisors, LLC, BlackRock Investment Management, LLC and BlackRock International Limited under the caption ~~In re BlackRock Mutual Funds Advisory Fee Litigation. The Consolidated Complaint, which purports to be brought derivatively on behalf~~effects of the Funds, alleges that the defendants violated Section 36(b) of the Investment Company Act by receiving allegedly excessive investment advisory fees from the Funds. On February 24, 2015, the same plaintiffs filed another complaint in the same court against BlackRock Investment Management, LLCpandemic are ongoing and ~~BlackRock Advisors, LLC. The allegations~~could be prolonged or worsen and legal claims in both complaints are substantially similar, with the new complaint purporting to challenge fees received by defendants after the plaintiffs filed their prior complaint. Both complaints seek, among other things, to recoverhave an ongoing adverse impact on behalf of the Funds all allegedly excessive advisory fees received by defendants in the twelve month period preceding the start of each lawsuit, along with purported lost investment returns on those amounts, plus interest. The defendants believe the claims in both lawsuits are without meritBlackRock’s business, including its operations and ~~intend to vigorously defend the actions. On September 25, 2017, the defendants filed a motion for summary judgment to dismiss the lawsuit.~~

Between November 12, 2015 and November 16, 2015, BlackRock, Inc., BlackRock Realty Advisors, Inc. (“BRA”), BlackRock US Core Property Fund, Inc. (formerly known as BlackRock Granite Property Fund, Inc.) (“Granite Fund”), and certain other Granite Fund related entities (collectively, the “BlackRock Parties”) were named as defendants in thirteen lawsuits filed in the Superior Court of the State of California for the County of Alameda arising out of the June 16, 2015 collapse of a balcony at the Library Gardens apartment complex in Berkeley, California (the “Property”). The Property is indirectly owned by the Granite Fund, which is managed by BRA. The plaintiffs also named as defendants in the lawsuits Greystar, which manages the Property, and certain other non-BlackRock related entities, including the developer of the Property, building contractors and building materials suppliers. The plaintiffs allege, among other things, that the BlackRock Parties were negligent in their ownership, control and maintenance of the Property’s balcony, and seek monetary, including punitive, damages. Additionally, on March 16, 2016, three former tenants of the Library Gardens apartment unit that experienced the balcony collapse sued the BlackRock Parties. The former tenants, who witnessed (but were not physically injured in) the accident make allegations virtually identical to those in the other previously filed actions and claim that,financial condition, as a result of, the collapse, they suffered unspecified emotional damage. Several defendants also filed cross-complaints alleging a variety of claims, including claims against the BlackRock Parties for contribution, negligence, and declaratory relief. BlackRock, Inc. believes the claims against it are without merit and intendsamong other things:

•	reduced AUM, resulting in lower base fees, as well as a reduction in the value of BlackRock’s investment portfolio, including its coinvestments and seed investments in sponsored investment funds;

•	lower alpha generation which may adversely affect future organic growth and BlackRock’s ability to generate performance fees;

•	reduced client and prospective client demand for BlackRock products and services and/or changing client risk preferences which may adversely affect future organic growth;

•	a decline in technology revenue growth as a result of extended sales cycles and longer implementation periods as some clients continue to work remotely;

•	negative impact of the pandemic on BlackRock’s clients, and key vendors (such as pricing providers), market participants and other third-parties with whom it does business;

•

the negative operational effects of extended remote working environments and the introduction of hybrid working models, including strain on Aladdin and/or BlackRock’s other internal and external technology resources leveraged at the firm, as well as the potential for heightened operational risks, such as cybersecurity and fraud risks;

•

the possibility that continued periods away from physical office locations and daily in-person interactions with colleagues has caused, and may cause, members of BlackRock’s workforce to become disconnected with corporate culture and policies, which may increase operational issues due to distractions, fatigue or a lack of oversight; and

•	the disruption to BlackRock’s workforce due to illness and health concerns, potential limitations of remote and hybrid work environments (including any complications associated with hiring and onboarding new employees remotely), and government-imposed restrictions, laws and regulations.

The aggregate extent to ~~vigorously defend the actions. A trial on all claims is scheduled to begin on February 5, 2018.~~

~~On June 16, 2016,~~ ~~iShares~~ ~~Trust, BlackRock, Inc. and certain of its advisory affiliates,~~which COVID-19, and the ~~directors and certain officers of the~~ ~~iShares~~ ~~ETFs were named as defendants in a purported class action lawsuit filed in California state court. The lawsuit was filed by investors in certain~~ ~~iShares~~ ETFs (the "ETFs"), and alleges the defendants violated the federal securities laws, purportedly by failing to adequately disclose in prospectuses issued by the ETFs the risks to the ETFs’ shareholders in the event of a "flash crash." Plaintiffs seek unspecified monetary damages. The Plaintiffs’ complaint was dismissed in December 2016 and on January 6, 2017, plaintiffs filed an amended complaint. The defendants filed a motion for judgmentrelated impact on the ~~pleadings dismissing that complaint. On September 18, 2017, the court dismissed the lawsuit.~~

April 5, 2011, to the present. The lawsuit generally alleges that the defendants breached their duties towards Plan participants in violation of the Employee Retirement Income Security Act of 1974 by, among other things, offering investment options that were overly expensive, underperformed peer funds, focused disproportionately on active versus passive strategies, and were unduly concentrated with investment options managed by BlackRock. While the complaint does not contain any specific amount in alleged damages, it claims that the purported underperformance and hidden fees cost Plan participants more than $60 million. On October 10, 2017, the plaintiffs filed an Amended Complaint, which, among other things, adds as defendants certain current and former members of the BlackRock Retirement and Investment Committees. The Amended Complaint also includes a new purported class claim on behalf of investors in certain Collective Trust Funds (“CTFs”) managed by BTC. Specifically, the plaintiffs allege that BTC exercised fiduciary authority over its compensation for securities lending services to the CTFs. The defendants believe the claims in this lawsuit are without merit and intend to vigorously defend the action.

~~Management, after consultation with legal counsel, currently does not anticipate that the aggregate liability arising out of regulatory matters or lawsuits will have a material effect on~~global economy, affect BlackRock’s business, results of operations and financial ~~position,~~ condition, will depend on future developments that are highly uncertain and cannot be predicted, including the scope and duration of the pandemic and any recovery period, the emergence and spread of variants of the COVID-19 virus, the continuing prevalence of severe, unconstrained and/or ~~cash flows. However, there is no assurance as~~escalating rates of infection in certain countries and regions, the availability, adoption and efficacy of treatments and vaccines, future actions taken by governmental authorities, central banks and other third parties (including new financial regulation and other regulatory reform) in response to ~~whether any such pending or threatened matters will have a material effect~~the pandemic, and the effects of the COVID-19 pandemic on BlackRock’s ~~results~~products, clients, vendors and employees. Moreover, the effects of ~~operations, financial position or cash flows~~the COVID-19 pandemic may heighten the other risks described in the section entitled “Risk Factors” in BlackRock’s most recent Annual Report on Form 10-K and any ~~future reporting period. Due to uncertainties surrounding~~subsequent reports filed with the ~~outcome of these matters, management cannot reasonably estimate the possible loss or range of loss that may arise from these matters.~~ Securities and Exchange Commission.

Item 2. Unregistered Sales of Eq~~uity~~Equity Securities and Use of Proceeds

During the three months ended September 30, ~~2017,~~2021, the Company made the following purchases of its common stock, which is registered pursuant to Section 12(b) of the Exchange Act.

Total Number
of Shares
Purchased

Average
Price Paid
per Share

Total Number of
Shares
Purchased as
Part of Publicly
Announced Plans
or Programs

Maximum
Number of
Shares that May
Yet Be
Purchased Under
the Plans or
Programs⁽¹⁾

July 1, 2017 through July 31, 2017

198,234

⁽²⁾

$
427.31

183,716

7,407,531

August 1, 2017 through August 31, 2017

439,530

⁽²⁾

$
422.69

427,122

6,980,409

September 1, 2017 through September 30, 2017

39,343

⁽²⁾

$
419.40

37,753

6,942,656

Total

677,107

$
423.85

648,591

	Total Number of Shares Purchased⁽¹⁾		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
July 1, 2021 through July 31, 2021		118,153	$	869.81		114,975		4,158,936
August 1, 2021 through August 31, 2021		201,718	$	914.12		200,337		3,958,599
September 1, 2021 through September 30, 2021		22,901	$	946.39		17,756		3,940,843
Total		342,772	$	901.00		333,068

_______________________

⁽¹⁾	~~In January 2017, the Board~~Consists of ~~Directors authorized the repurchase of an additional 6 million shares under the Company’s existing share repurchase program for a total of up to 9 million shares of BlackRock common stock.~~

⁽²⁾

~~Includes~~ purchases made by the Company primarily to satisfy income tax withholding obligations of employees and members of the Company’s Board of Directors related to the vesting of certain restricted stock or restricted stock unit awards and purchases made by the Company as part of the publicly announced share repurchase program.

Item 6. Exhibits

Exhibit No.		Description

~~12.1~~3.1(1)		~~Computation~~Amended and Restated Certificate of ~~Ratio~~Incorporation of ~~Earnings to Fixed Charges~~BlackRock

~~31.1~~3.2(2)		~~Section 302 Certification~~Certificate of ~~Chief Executive Officer~~Change of Registered Agent and/or Registered Office

~~31.2~~3.3(2)		~~Section 302 Certification~~Amended and Restated Bylaws of ~~Chief Financial Officer~~BlackRock

31.1		Section 302 Certification of Chief Executive Officer

31.2		Section 302 Certification of Chief Financial Officer

32.1		Section 906 Certification of Chief Executive Officer and Chief Financial Officer

101.INS		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

101.SCH		Inline XBRL Taxonomy Extension Schema Document

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE		Inline XBRL Taxonomy Extension Presentation ~~Linkbase Document~~

~~EXHIBIT INDEX~~

~~Exhibit No.~~		~~Description~~

~~12.1~~		~~Computation of Ratio of Earnings to Fixed Charges~~

~~31.1~~		~~Section 302 Certification of Chief Executive Officer~~

~~31.2~~		~~Section 302 Certification of Chief Financial Officer~~

~~32.1~~		~~Section 906 Certification of Chief Executive Officer and Chief Financial Officer~~

~~101.INS~~		~~XBRL Instance Document~~

~~101.SCH~~		~~XBRL Taxonomy Extension Schema Document~~

~~101.CAL~~		~~XBRL Taxonomy Extension Calculation~~ Linkbase Document

~~101.DEF~~104		Cover Page Interactive Data File (formatted as Inline XBRL ~~Taxonomy Extension Definition Linkbase Document~~and contained in Exhibit 101)

(1)	Incorporated by reference to BlackRock’s Current Report on Form 8-K filed on May 28, 2021.

(2)
~~101.LAB~~		~~XBRL Taxonomy Extension Label Linkbase Document~~

~~101.PRE~~		~~XBRL Taxonomy Extension Presentation Linkbase Document~~Incorporated by reference to BlackRock’s Current Report on Form 8-K filed on July 23, 2021.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	BLACKROCK, INC.
	(Registrant)

	By:	/s/ Gary S. Shedlin
Date: November ~~8, 2017~~5, 2021		Gary S. Shedlin
		Senior Managing Director & Chief Financial Officer (Principal Financial Officer)

7281

September 30, 2017	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs		Investments Measured at		Other Assets Not Held at		September 30,
(in millions)	(Level 1)		(Level 2)		(Level 3)		NAV⁽¹⁾		Fair Value⁽²⁾		2017
Assets:
Investments
Available-for-sale	$	8	$	73	$	23	$	—	$	—	$	104
Held-to-maturity securities		—		—		—		—		76		76
Trading:										—
Deferred compensation plan mutual funds		54		—		—		—		—		54
Equity securities/Multi-asset mutual funds		353		—		—		—		—		353
Debt securities / fixed income mutual funds		1		282		2		—		—		285
Total trading		408		282		2		—		—		692
Other investments:
Equity method:
Equity and fixed income mutual funds		314		—		—		10		—		324
Other		—		—		—		608		12		620
Total equity method		314		—		—		618		12		944
Cost method investments		—		—		—		—		92		92
Carried interest		—		—		—		—		20		20
Total investments		730		355		25		618		200		1,928
Separate account assets		112,957		34,268		—		—		713		147,938
Separate account collateral held under securities lending agreements:
Equity securities		19,093		—		—		—		—		19,093
Debt securities		—		8,338		—		—		—		8,338
Total separate account collateral held under securities lending agreements		19,093		8,338		—		—		—		27,431
Investments of consolidated VIEs:
Private / public equity⁽³⁾		5		3		114		69		83		274
Equity securities		338		—		—		—		—		338
Debt securities		—		350		—		—		—		350
Other		—		—		—		64		—		64
Carried interest		—		—		—		—		260		260
Total investments of consolidated VIEs		343		353		114		133		343		1,286
Total	$	133,123	$	43,314	$	139	$	751	$	1,256	$	178,583
Liabilities:
Separate account collateral liabilities under securities lending agreements	$	19,093	$	8,338	$	—	$	—	$	—	$	27,431
Other liabilities⁽⁴⁾		—		7		228		—		—		235
Total	$	19,093	$	8,345	$	228	$	—	$	—	$	27,666

December 31, 2016 (in millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Investments Measured at NAV⁽¹⁾		Other Assets Not Held at Fair Value⁽²⁾		December 31, 2016
Assets:
Investments
Available-for-sale	$	7	$	49	$	24	$	—	$	—	$	80
Held-to-maturity securities		—		—		—		—		51		51
Trading:
Deferred compensation plan mutual funds		59		—		—		—		—		59
Equity/Multi-asset mutual funds		308		—		—		—		—		308
Debt securities / fixed income mutual funds		1		250		7		—		—		258
Total trading		368		250		7		—		—		625
Other investments:
Equity method:
Equity and fixed income mutual funds		323		—		—		5		—		328
Other		—		—		—		394		8		402
Total equity method		323		—		—		399		8		730
Cost method investments		—		—		—		—		91		91
Carried interest		—		—		—		—		18		18
Total investments		698		299		31		399		168		1,595
Separate account assets		109,663		38,542		—		—		884		149,089
Separate account collateral held under securities lending agreements:
Equity securities		22,173		—		—		—		—		22,173
Debt securities		—		5,619		—		—		—		5,619
Total separate account collateral held under securities lending agreements		22,173		5,619		—		—		—		27,792
Investments of consolidated VIEs:
Private / public equity⁽³⁾		3		2		112		89		79		285
Equity securities		278		—		—		—		—		278
Debt securities		—		274		—		—		—		274
Other		—		—		—		63		—		63
Carried interest		—		—		—		—		108		108
Total investments of consolidated VIEs		281		276		112		152		187		1,008
Total	$	132,815	$	44,736	$	143	$	551	$	1,239	$	179,484
Liabilities:
Separate account collateral liabilities under securities lending agreements	$	22,173	$	5,619	$	—	$	—	$	—	$	27,792
Other liabilities⁽⁴⁾		—		7		115		—		—		122
Total	$	22,173	$	5,626	$	115	$	—	$	—	$	27,914

	December 31,		Realized and Unrealized Gains (Losses) in Earnings				Sales and			Issuances and other		Transfers into		Transfers out of			September 30,		Total Net Unrealized Gains (Losses) Included in
(in millions)	2015		and OCI		Purchases		Maturities			Settlements⁽¹⁾		Level 3		Level 3			2016		Earnings⁽²⁾
Assets:
Investments
Available-for-sale securities⁽³⁾	$	23	$	—	$	47	$	—		$	—	$	—	$	(46	)	$	24
Trading		2		—		6		—			—		—		(3	)		5
Total investments		25		—		53		—			—		—		(49	)		29
Assets of consolidated VIEs - Private equity		196		13		—		(15	)		—		—		—			194	$	13
Total Level 3 assets	$	221	$	13	$	53	$	(15	)	$	—	$	—	$	(49	)	$	223
Liabilities:
Other liabilities⁽⁴⁾	$	48	$	—	$	—	$	—		$	70	$	—	$	—		$	118	$	—

Outstanding at	Market Performance- Based RSUs			Weighted- Average Grant Date Fair Value
December 31, 2016		803,474		$	151.20
Converted		(517,138	)	$	126.76
September 30, 2017⁽¹⁾		286,336		$	195.33

(in millions)	Foreign currency translation adjustments⁽¹⁾			Other⁽²⁾			Total
For the Three Months Ended September 30, 2017
June 30, 2017	$	(579	)	$	4		$	(575	)
Net other comprehensive income (loss) for the three months ended September 30, 2017		102			—			102
September 30, 2017	$	(477	)	$	4		$	(473	)
For the Nine Months Ended September 30, 2017
December 31, 2016	$	(721	)	$	5		$	(716	)
Net other comprehensive income (loss) for the nine months ended September 30, 2017		244			(1	)		243
September 30, 2017	$	(477	)	$	4		$	(473	)

	GAAP												As Adjusted
	Three Months Ended						Nine Months Ended						Three Months Ended						Nine Months Ended
	September 30,						September 30,						September 30,						September 30,
(in millions)	2017			2016			2017			2016			2017			2016			2017			2016
Operating income⁽¹⁾	$	1,394		$	1,209		$	3,783		$	3,345		$	1,398		$	1,216		$	3,795		$	3,442
Total nonoperating income (expense)⁽¹⁾⁽²⁾		(2	)		(1	)		(27	)		(70	)		(2	)		(1	)		(27	)		(70	)
Income before income taxes⁽²⁾	$	1,392		$	1,208		$	3,756		$	3,275		$	1,396		$	1,215		$	3,768		$	3,372
Income tax expense	$	445		$	333		$	1,090		$	954		$	427		$	361		$	1,074		$	1,010
Effective tax rate		32.0	%		27.6	%		29.0	%		29.1	%		30.6	%		29.7	%		28.5	%		30.0	%

(in millions)	GAAP Basis			Impact on Cash Flows of Consolidated Sponsored Investment Funds			Cash Flows Excluding Impact of Consolidated Sponsored Investment Funds
Cash and cash equivalents, December 31, 2016	$	6,091		$	53		$	6,038
Cash flows from operating activities		2,486			(252	)		2,738
Cash flows from investing activities		(490	)		(52	)		(438	)
Cash flows from financing activities		(2,083	)		324			(2,407	)
Effect of exchange rate changes on cash and cash equivalents		161			—			161
Net change in cash and cash equivalents		74			20			54
Cash and cash equivalents, September 30, 2017	$	6,165		$	73		$	6,092

	Total Number of Shares Purchased			Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs⁽¹⁾
July 1, 2017 through July 31, 2017		198,234	⁽²⁾	$	427.31		183,716		7,407,531
August 1, 2017 through August 31, 2017		439,530	⁽²⁾	$	422.69		427,122		6,980,409
September 1, 2017 through September 30, 2017		39,343	⁽²⁾	$	419.40		37,753		6,942,656
Total		677,107		$	423.85		648,591